Terminating an Employee in Texas

Terminating an employee from your company is never pleasant or easy and the termination process should not be taken lightly.  Your company should have procedures in place to provide employees ongoing feedback so they know what they are doing well and areas in which they can improve.  Employees that are not performing adequately should be given a chance to improve their performance and there should be a process in place that documents counseling sessions and/or disciplinary notices, steps the employee has taken to improve, the employee’s progress, and any final results. This article does not cover that process but instead deals with procedures that should be followed when an employer has determined that the only remaining course of action with an employee is employment termination.

Terminating an employee always comes with a certain amount of risk, regardless of the termination reason. People get angry when they are fired and there is always a certain amount of unpredictability in such a situation.  An employee, fresh from the indignity of being fired, could undertake an act of revenge or might try to sue the company. Therefore, it is crucial to follow proper procedures when terminating an employee in order to minimize, and sometimes prevent, future headaches.  We should note here that while proper steps may help an employer with respect to success in any employment lawsuit, nothing can prevent them since employees can file a lawsuit, whether or not they ultimately have valid grounds or prevail.

Plan Ahead to Diffuse the Situation and Reduce Risk

Considering these important points before a termination takes place will decrease tensions and reduce your company’s exposure to risk.

  • Plan a time either at the beginning or end of the day to minimize embarrassment to the employee;
  • Meet on neutral grounds, such as in a conference room—not your office or theirs – but ensure that the location is private;
  • Keep the meeting short;
  • Is there a history of complaints by the employee based on any legally protected category (i.e., race, religion, disability, retaliation, harassment, etc.)? If so, consulting an employment attorney is advised;
  • Arrange to restrict the employee’s computer access either during or just before the termination meeting. This is to prevent deletion of files or other damaging actions in the moments after the termination;
  • Arrange to recover company property, such as phones, laptops, uniforms, and other company property. If the employee needs to transfer any personal information from an electronic device, ensure that the employee does it on site and in the presence of a company representative;
  • Be polite and professional. Do not humiliate the individual.

Legal Steps

In addition to the steps above, there are some measures you will need to take to keep yourself covered in case the employee does decide to take legal action. These include the following:

  • Draft a Wage Deduction Authorization agreement for recovering debts, such as for borrowed vacation time or unpaid loans, from the employee’s final check. Ideally this should be drafted and signed far before the termination (i.e., at hiring) since an employer is unable to make most deductions from an employee’s paycheck without a written and signed authorization;
  • Make sure the employee’s documentation is complete with reasons to support termination. Be honest and forthright about the reason for termination but you do not need to provide any detail. If the termination was due to poor performance, say it was due to poor performance.  If it was due to bad behavior, say it was due to bad behavior.  You do not need to provide examples or details, though.  Do not make up a false reason merely to be polite.  Also do not “kitchen sink” the termination.  This means you should not list every bad or improper thing the employee has ever done as a reason for termination.  A “kitchen sink” termination and/or a lack of rationale can often lead to an employment lawsuit or differing reasons for termination down the road (i.e., as when challenging unemployment);
  • Determine whether you need a release from any potential claim. If so, your lawyer can assist with drafting one.  This should not be tied to the employee’s receipt of the final paycheck;
  • Ideally you should have one other person in the room, but ensure that it is a management-level employee or member of Human Resources;
  • Have everyone who participated in the meeting document what took place;
  • Deliver the final paycheck within six days of termination, in accordance with Texas Payday Law.

Taking the proper steps when terminating an employee in Texas will help your company avoid many lawsuits and defeat any litigation that does occur. Employment lawyers, such as those at Simon | Paschal PLLC, can guide you through the employee termination process and help you protect yourself and your business.

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