Here’s how to win termination lawsuits: Back up your decisions with solid business reasons for the discharge—especially if you had to let people go to reduce labor costs or otherwise survive financial hardship.
Courts seldom second-guess employers’ efforts to cut costs, even if the company is profitable at the time. Simply put, if an employer can reasonably argue that it eliminated a position to save money (and presumably have even higher profits), then a judge won’t assume the decision was based on some other nefarious reason.
Recent case: Amy worked for Medco Health Solutions in a senior director position. She clashed with her immediate supervisor and complained to HR about what she perceived as his harsh treatment of her, which she attributed to her gender. However, she got a large bonus the same year, as well as a sizable salary increase.
Shortly after, she was reassigned to another position. The job had fewer responsibilities, but she received the same pay and benefits. Around the same time, she testified for the company in a lawsuit.
Then she was terminated after another senior manager looked at his staffing costs and determined that he could lower the labor burden by eliminating Amy’s position.
She sued, alleging retaliation for complaining about sex discrimination. She argued that she had been kept on just long enough to testify for the company and then, after she was no longer useful, she was fired.
The court dismissed her complaint. It reasoned that even if the division she worked in was profitable, that didn’t mean the company couldn’t cut its labor costs. In fact, the court said such a decision was reasonable. (Meyers v. Medco Health Solutions, No. 09-Civ-09216, SD NY, 2012)