Like any relationship, employment relationships can be challenging, and some simply do not work out. Whether it is poor performance, policy violations, or more serious wrongdoings, separation may be the best course of action for the employer and/or the employee. Employers that find themselves struggling to manage a problem employee, or an employee who is not a “good fit,” sometimes jump to termination without considering potential legal risk associated with the termination. While Oregon is an employment “at-will” state, meaning that an employer or employee may terminate the employment relationship at any time, for any reason, employers can still find themselves in hot water after terminating an employee.
The decision to terminate the employment relationship should be made after careful consideration and thorough documentation of the concern(s) that led to the decision to terminate. Absent any serious policy violation or unsafe behavior, providing the employee with an opportunity to improve or change their behavior is generally recommended over a hasty termination decision. In many instances, the conduct that led to the breakdown in the relationship can be altered via clear communication and resetting expectations with the employee.
Creating interventions, such as a performance improvement plan (PIP), communicates expectations for performance and provides an opportunity to resolve performance gaps within a set time frame. If the employee has not met the goals or benchmarks identified in the PIP within the prescribed timeframe, the employer may choose to extend the PIP or opt to terminate the employment relationship.
Document Performance Concerns
When concerns with an employee’s performance or conduct arise, those concerns should be documented and added to the employee’s personnel file. Additionally, the concerns should be communicated to the employee, with an explanation of what is expected moving forward. This conversation should also be documented. The process of collecting and creating such documentation helps insulate the employer from potential liability.
Documenting concerns can be as simple as the manager emailing themselves a brief summary of the issue and what was communicated to the employee. When documenting a conversation with the employee, the manager may also consider emailing the employee a summary of the conversation, including the issue discussed, the reason for concern, and expectations moving forward. This provides the employee with the opportunity to provide feedback if they disagree with the manager’s recollection of the conversation. It also serves as proof that the employee acknowledged that the conversation occurred and that they were aware of the performance concerns and the employer’s expectations.
Depending on the situation and type of concern the employer has with the employee’s performance or conduct, continued coaching and performance management may be warranted. However, when coaching and performance management are unsuccessful, or if the concern is more egregious such that the employer is unwilling to provide the employee with an opportunity to improve or change their behavior, termination may be the next step.
Termination Considerations
Most terminations come with some level of risk. An employer may have well-documented, legitimate reasons for the termination, but an employee may feel their termination was unlawful and decide to file a complaint with an administrative agency, like the Oregon Bureau of Labor and Industries (BOLI) or the federal Equal Employment Opportunity Commission (EEOC), or file a lawsuit against the employer. If this happens, even a strong case can be expensive to defend.
To mitigate risk, employers contemplating terminating an employee should consider several factors, including the following:
- Is the employee a member of a protected class (e.g., age, sex, religion, disability)?
- Has the employee taken protected leave recently?
- Has the employee engaged in any other protected activity recently (e.g., filing a workers’ compensation claim, putting the employer on notice of their disability, or complaining about harassment, discrimination, retaliation, or other prohibited conduct in the workplace)?
- Were other past employees who had similar performance issues or engaged in similar conduct also terminated?
If the employee is a member of a protected class or otherwise engaged in protected activities, the employer should ensure that the reason for termination is thoroughly and clearly documented, including any communications with the employee regarding the concerns that led to the termination decision. If the employer is unable to show that the employee was terminated for a legitimate, nondiscriminatory reason, the risk of future litigation and potential liability increases. In these circumstances, or in conjunction with any termination, an employer could offer the departing employee severance pay in exchange for a full release of claims to mitigate any risk of litigation.
Conclusion
Many employers rely on Oregon’s employment “at-will” status as permission to terminate employees quickly and without a thorough and thoughtful consideration process. Although Oregon employers can technically terminate employees at any time, for any reason, wrongful termination claims or claims that an employee was terminated for discriminatory or retaliatory reasons are common. To mitigate the risk of such litigation, employers should contemplate the steps and considerations outlined in this article and contact trusted employment counsel for guidance before terminating an employee’s employment.
Becky Zuschlag is an attorney at Barran Liebman LLP, where she represents employers on a wide range of employment issues. Contact her at 503-276-2151 or bzuschlag@barran.com.
Avery Tunstill is a law clerk at Barran Liebman LLP, where she partners with attorneys in client trainings, legal research, and the drafting of employment policies and handbooks.
