Overview: Employee terminations are restricted for certain reasons or without proper procedures. While Title VII of the federal Civil Rights Act prohibits termination which discriminates against protected classes of workers, state law can be more expansive in creating classes of workers who are eligible for such protections, shielding employees who are not covered by federal law. Similarly, some states have broader restrictions against retaliatory terminations for certain types of protected activities, like filing workers' compensation claims and for blowing the whistle on unlawful or wasteful practices in the workplace.
Federal and state law also requires employers to utilize notification procedures when they plan to lay off large numbers of employees or close an entire facility. The federal WARN Act sets the minimum standard for covered employers, but some states impose even stricter requirements on employers based on the number of employees they plan to discharge.
Employees leave a company for other reasons as well, through retirement and resignations, some of which can be viewed as forced resignations or constructive discharges. Exit interviews and managing the exit process should be handled consistently and in compliance with federal and state law.
Trends: Employers are increasingly gravitating toward severance packages for employees terminated involuntarily in exchange for waivers or releases of claims against the employer. With these systems in place, employers can preemptively eliminate post-termination threats by providing outgoing employees with something of value. Employers must be prudent, however, in ensuring that such termination agreements are enforceable by crafting agreements in easily digestible language, providing valuable consideration in exchange for waivers and fully documenting the exchange.
Author: Michael Jacobson, JD, Legal Editor
Updated to reflect NLRB decisions on email.
Numerous legislative changes take effect on or about January 1, affecting minimum wage rates, employee leaves, health care benefits and more. HR should take note of these legal developments and take appropriate steps to comply.
Updated to reflect termination provisions in amendments to law regarding restrictive covenants, effective January 1, 2020.
Updated to reflect the final overtime rule updating and revising the Fair Labor Standards Act (FLSA) overtime exemption requirements, effective January 1, 2020.
Updated to reflect the Farm Laborers Fair Labor Practices Act, effective January 1, 2020.
Updated to reflect layoff provisions in law regarding noncompete requirements, effective January 1, 2020.
Updated to reflect mini-WARN notice requirements for call centers, effective January 1, 2020.
The McDonald's Corporation board of directors fired the company's CEO after concluding that he had violated a company policy prohibiting managers from engaging in relationships with employees.
Guidance for HR on understanding and complying with federal and state law regarding legal and fair employee terminations.