Although an unpleasant task, employee dismissal should be planned in advance to avoid costly legal action and negativity amongst co-workers.
Except in cases of gross misconduct, employee dismissal is usually a matter of last resort. It should have been preceded by an ongoing process of warnings on the one hand and counseling, training and other remedial measures on the other. The record of disciplinary proceedings should be used for this purpose. The precise nature of what is meant by gross misconduct should be specified in the personnel manual.
Giving proper reasons for firing an employee can help avoid legal problems later on, and include:
- Misbehaviour or rudeness toward clients or customers
- Drunkenness or substance abuse on-the-job
- Theft of company property
- Frequent and unexplained absences from work
- Entering false information on records
- Gross insubordination
- Incompetence or failure to respond to training
- Fighting or other physical aggression
- Using company property for personal use
The well-informed employer will always have clear evidence that the employee understood company policy. The employer should document evidence of misconduct and keep it on file with a written summary of the termination. Even when firing an employee “at will”, the manager must exercise care in wording the reasons for the termination. For example, the employer should not claim “downsizing” when they plan immediately to hire another employee to perform the same job.
It is not enough merely to suspect that an employee has violated a company policy. The employer should never fire an employee on a whim or out of resentment. Management should remain calm and collected during the entire process. The reasons for firing an employee may be valid, but handling the situation badly can cause legal problems later on.
Electronic records management
Staff may be dismissed either with full benefits or without any benefits. The personnel file should contain a record of any entitlements to pension and other benefits to which dismissed staff are entitled. The record should be maintained until the normal retirement age, when the pension should start to be paid. The dismissed worker should be provided with a copy of the record.
Where the worker is dismissed with loss of all benefits, a record of this fact will be needed to prevent re-employment by the agency (if the organisation’s personnel policy requires this) or the mistaken payment of benefits to which the individual is not entitled. Normally the personal file would be kept for a minimum of five years after dismissal without benefits.
The dismissal should be noted on the personnel file and the file should then be closed. The file then may be held in either the department responsible for pensions or in the last employing department. In either case, the central authority responsible should be informed. The pensions department should maintain a record of the date of retirement.
Even if the individual is not dismissed, the full record of dismissal proceeding should be retained for any statutory period required, which may be 3 to 5 years.