1. Altagracia Del Valle
HRDV 3305-D01
April 28, 2015
Termination Legalities
Introduction
The topic of staff management of employee that I am going to focus on is termination legalities.
There are many issues in the termination process that could go wrong if not done right. With
termination having such a negative impact on all aspects of the company. It is important that
steps are being followed to try and help the process be less nerve racking for all those involved. I
will go over legal termination and the regulation that applies and various ways that termination
can be done and outcomes from such termination, research of termination process and why it is
beneficial, why termination impacts staffing and HR and how termination impacts the overall
organization.
Legal Termination
Employee termination has a negative impact on many aspects of the company so it should
be used as a last resort. Managers/supervisor need to know the laws and employee rights that
apply when terminating an employee. Manager/supervisors also need consult with HR and they
will guide the managers through the laws of terminating. Legal.com definition of terminations is
“the expiration of a contract when one side failed to act up to the terms of the contract, and the
other side is ending the relationship as a result”. (legal.com n.d) The laws that apply to employee

2. termination are Consolidated Omnibus Budget Reconciliation Act (COBRA), Health Insurance
Portability and Accountability Act (HIPAA), Unemployment Insurance, Equal employment
opportunity (EEO) and the Veteran’s Employment and Training Service (VETS). In order to stay
in accordance with the law regulations need to follow.
Consolidated Omnibus Budget Reconciliation Act (COBRA) ensures that terminated
employees and their families have the right to continue health insurance coverage at the group
rate for a period of 18 months. This law applies to companies with 20 or more employees. Health
Insurance Portability and Accountability Act (HIPAA) ensures that the employee and their
families receive rights and protection for health coverage that limits pre-existing conditions and
prohibits discrimination on health status. Equal employment opportunity (EEO) prohibits
discrimination based on “age, race, color, religion, sex, ethnic/national origin, disability and
veteran status” (dol.gov n.d). Terminating on these bases are clear violations of the law. The
EEO also gives protection for people who report illegal activity known as whistleblowers. They
are protected from retaliation from the company. Veteran’s Employment and Training Service
(VETS) offers re-employment rights to service men/women when they return back from service.
At will employment allows the employer or employee terminate the relationship without any
reason or explanation. At will employment agreement is recognized by all states except
Montana. This agreement is important to understand because promises made can void the at-will
agreement known as the Promissory Estoppel doctrine and many of the courts will apply this
doctrine making the company fulfill those promises. PayDay Law requires “the timing of the
final paycheck is section 61.014. If an employee is laid off, discharged, fired, or otherwise
involuntary separated from employment, the final pay is due within 6 calendar days of
discharge.” (TWC n.d) Other federal protected laws are time off benefits that include family

3. leave, medical leave, military leave, time off to vote and to serve on jury duty. Managers also
need to know about the laws that apply to unemployment insurance. Under the unemployment
insurance law some employees may be eligible to file a claim if they lost their job to no fault of
their own. Under this law managers are required by law to notify employees of this right. They
also need to know about vested retirement plan. Under this law they “remain eligible to receive
vested 401(k), profit sharing and pension benefits.”(Beesley 2012). Managers need to know
these laws so that they do not break any laws during the termination process. By knowing these
laws the manager can help the company from facing possible lawsuits by terminated employees.
There are different types of termination that may impact what benefits employees may
qualify for. To start out with I will cover voluntary termination. Under a voluntary termination
the employee decides to leave the company. They do not need to give any information for the
reason of leaving in at-will states. The law states that a two week notice is needed. According to
Mayhew, the company can benefit from a voluntary termination by gaining insight as to why the
person chose to leave the company and use that insight to avoid future people from leaving.
When a person voluntary terminates the job they lose the benefits that are protected under law
unless they were working in a hostile environment that was created to push that person out of
employment which is known as constructive discharge. In order for the employee to gain any of
the benefits he/she must prove that they were push out using unfair practices. The employee will
also need to show that they allowed the former employer adequate time to fix the problem.
Wrongful termination is unfair employment practices based on discrimination. There are laws in
place to protect employees from discrimination. There is Title VII of the Civil Rights Act of
1964, Age Discrimination in Employment of 1967 and American with Disability Act of 1970.
Wrongfully terminated employees can file a claim with U.S. Equal Employment Opportunity

4. Commission. According to Schnapp, studies have shown that employees have an 86% chance of
winning a wrongful termination case if the case goes to jury. (Schnapp.com n.d). In a wrongful
termination case employee handbooks and written policy are used in the case as evidence to
prove if the company followed their own discipline system policy before the termination was
justified, according to Shnapp. (Shnapp n.d) For example, if the company required two verbal
warning before being written up and the employee record does not show evidence that verbal
warnings were issued this can be grounds for the employee to win the lawsuit. This is why it is
very important for managers to be organized and report all finding immediately and create a
solid proof paper trail. Just cause termination is a fair reason for termination. Usually the
employee has been involved in illegal activities such as, theft or sexual harassment which they
are terminated immediately. For cause termination requires documentation to prove that the
termination was justified. Once the all the documentation is recorded the employer will have a
meeting with the employee the supervisor and the HR representative to terminate the employee.
Research of termination process
Having a termination process can help the company from being sued and helps with the
overall process of the termination. Termination is a negative impact on the company and the staff
so it is important that the company establishes a termination process to make sure that everything
goes as smooth as possible. It will guide the firing manger so that all bases are covered. It will
also serve to keep a professional approach during the whole process. Wood & Karau studies have
shown when terminated employees are treated with respect the outcome is more favorable and
the employee will be less hostile. Nobody enjoys the task of employee termination; the
termination process can help to take out anxiety from having to do the termination. The Texas
Workforce Commission suggests a 10 steps process.

5. 1. “Was there specific incidents close in time to discharge?”;
2. “Can employer show that the employee violated a known policy or law?”;
3. Are there witnesses?;
4. Is there “documentation on file to support the termination?”;
5. Did employee go through the whole “discipline system?”;
6. “Was the employee confronted with the problem and given a chance to explain?”;
7. Refer to the anti-discrimination laws that include the prevention of firing on the bases of
race, age, gender, religion and disability.;
8. Whistleblowers and federal protected time off such as family, medical leave, military
leave, time off for voting and jury duty.;
9. In the “case of a simple layoff is the company using neutral business related criteria, not
related to any minority characteristics, to evaluate the affected department and select
those who will be laid off?”;
10. “Depending on the how the question are answered the company may need to seek legal
advice” prior to the termination (TWC n.d).
Additional procedures that are recommended by hr.com that are not mentioned by the Texas
Workforce Commission include schedule meetings. When terminating an employee is best to
have two people in the room when employee is being let go. Wood & Karau studies also have
found that when a security guard is present that the terminated employee will act more
aggressively. It is important to create a hostile free environment when letting go an employee
and it is best to have another manager, supervisor or HR representative present. The purpose of
this is to have a witness and to save the company assets. When it is just one on one it becomes he
said she said incident and having two people in the meeting will protect the company from

6. possible lawsuits. In the meeting it is best to explain the situation. During the termination it is
important to be clear and concise when explaining. By being clear and concise helps to not
accidently make promises that will eventually hurt the company in the long run. This will allow
the employee some closure and keep the company from being binded to the employee any longer
than needed. Termination is very difficult for all those involved. Another area that needs to be
covered is benefits they will receive after they leave or benefits that will be withheld. This is the
time you would tell them about possible unemployment insurance, health insurance coverage and
vested retirement plan if it applies. Allow the employee to respond even if it does not change the
outcome. Beesley suggest, doing the meeting early in the week and as early as possible and be
prepared to receive company property. The meeting should only be discussed with people that
are affected by the termination. Those usually consist of manager/supervisor, terminated
employee and HR. With termination be a touchy subject it is best to make sure all rules are
procedure are done correctly in order to avoid a possible lawsuit.
Why termination impacts staffing and HR
Termination impacts the staffing and HR because co workers will have to pick up the slack left
by the terminated employee. HR plays a huge role in the termination process. They guide the
manager in process to avoid breaking any laws. HR also should be contacted before you get to
the point where the employee needs to be fired. If the manager goes to HR when they first start
having problems, HR can coach them through the process and help document information so
when the time comes to having to fire an employee all documentation will be in place to help the
process move along quickly. Kursmark, states that the purpose of HR is “to maintain the
employee’s dignity throughout a difficult process”. (Kursmark 2007) HR helps to create clear
communication between all parties involved. They help the manager become aware of any laws

7. that may be breaking. HR will also be the last stop the terminated employee goes to sign any
paperwork.
How termination impacts the overall organization
Termination impacts the overall organization in many ways. It affects the person being fired and
their family. It affects the atmosphere of the workplace by creating resentment from the person
being fired and the employees who are still working because employees may not see the whole
picture and feel that the firing was uncalled for. It also disrupts production because it leaves that
position needing to be filled. It also haves the co-employees needing to step in to cover the
position until it can be filled creating overtime cost. Beesley states, that it can cost an estimate of
“50 to 60% of that person’s annual salary to refill that position” (Beesley 2012). Other cost the
company will face are advertising to look for another person and training cost. Another aspect
that would affect the organization would be if the person fired feels they were let go unjustly
they may try to sue the company and it would result in legal fees. With so many negative affects
the company would face in having to terminate employee it is very crucial to use termination as
“last resort” according to Beesley. She also states when faced with having to terminate the
employee it is important to run through a checklist to make sure the purpose of the termination is
done fairly. The checklist that Beesley suggest is asking yourself “Have your company’s policies
been applied fairly? Are you firing for performance or personality?; Have you tried coaching,
additional training; progressive discipline, a performance improvement plan, and/or
reassignment? Do you have all the facts and have these facts been documented.” (Beesley 2012)
If any of the answers are no you may want to re-evaluate the termination or seek legal advice. If
the termination questions are all yes then it is important to treat the person with respect and have
documentation on file to protect company from any possible legal action.

8. Conclusion
Termination causes a negative impact on the company financially and emotionally. Even though
termination is a negative affect it can be done professionally and with dignity for the employee
and co-workers sake. It is essential that laws are being followed as well as company policy and
establishing communication with HR so that company can avoid future damages. With there
being a high number of wrongful termination cases that are being won by the employee it is
essential that manager are making sure they are doing everything in their power to follow rules
and regulation when it comes to terminating an employee. Hr can guide the manager in the
termination process to create a paper trail. It is also very important to document incidents as they
happen and seeking HR advice from the very start when problems start occurring. Even though
termination is a negative the process it can be done in a professional manner to allow the
terminated party some dignity in the process. During the termination process it is essential that
the manager does not violate any laws or employee rights.

9. References
Beesley, C. (2012, February 2). How to fire an employee and stay within the law. Retrieved
April 23, 2015, from https://www.sba.gov/blogs/how-fire-employee-and-stay-within-law
Crouch, G. (n.d). ROGER H.SCHNAPP : Ending Employment Properly : Lawyer Tells How to
Avoid Wrongful-Termination Suits. Retrieved May 2, 2015, from
http://articles.latimes.com/1989-12-25/business/fi-923_1_wrongful-termination-suit
Final Pay. (n.d.). Retrieved April 23, 2015, from
http://www.twc.state.tx.us/news/efte/final_pay.html
Kursmark, L. (2007, April 7). What is HR's Role in Employee Termination? Retrieved April 25,
2015, from http://hrpeople.monster.com/training/articles/35-what-is-hrs-role-in-
employee-termination
Matthew S. Wood and Steven J. Karau. Preserving Employee Dignity during the Termination
Interview: An Empirical Examination. Journal of Business Ethics. Vol. 86, No. 4. (Jun.,
2009) , pp. 519-534 Published by: Springer Stable URL:
http://www.jstor.org/stable/40295109
Mayhew, R. (n.d.). Voluntary Termination of Employment. Retrieved May 1, 2015, from
http://smallbusiness.chron.com/voluntary-termination-employment-2897.html
Termination Checklist. (n.d.). Retrieved April 23, 2015, from
http://www.twc.state.tx.us/news/efte/termination_checklist.html
Termination. (n.d.). Retrieved April 29, 2015, from http://www.dol.gov/dol/topic/termination/

10. Using the termination process to minimize claims. (2002, August 16). Retrieved April 23, 2015,
from
http://www.hr.com/SITEFORUM?&t=/Default/gateway&i=1116423256281&application
=story&active=no&ParentID=1119278127660&StoryID=1119649981265&xref=https://
www.google.com/
Wicks, D. (n.d.). What Is the Difference Between Cause and Just Cause for Terminating
Employment? Retrieved May 1, 2015, from http://smallbusiness.chron.com/difference-
between-cause-just-cause-terminating-employment-24361.html