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The “at-will” nightmare and how to prevent it

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Here’s every Texas HR department’s nightmare: An employer terminated a worker on the grounds that he wasn’t “a good fit,” assuming that since Texas’s status as an “at-will” employer meant “for no particular reason”. The Texas Workforce Commission felt differently, demanding documented evidence of the worker’s inadequacies. The employer had to scramble to create the documentation, spend about $3,000 on attorney fees — and still had pay a severance!

Yes, Texas is an “at-will” state, but just because you can hire and fire at any time doesn’t mean you should throw caution, documentation, and good business sense out the window, unless you’re ready to face a lawsuit or other legal action.

How can you avoid this nightmare? Let us count the ways:

  1. Maintain Accurate Job Descriptions. Spell out the employee’s tasks and responsibilities from the beginning in a detailed job description. The clearer the major job functions, duties, and responsibilities are, the easier it is for you to objectively measure the employee’s job performance.
  2. Measure Performance. Depending on the type of position, develop realistic and attainable performance goals for each employee wherever possible.  Communicate these goals to the employee in order to get their buy-in.  Have the employee track their own performance relative to goal, and provide you with periodic metrics or status reports.  Correct any unintentional biases/embellishments that may show up along the way, as they often do, and keep the employee focused on their job function.
  3. Document Performance. This is one area that most owners and managers fall short.  Many see written documentation as an interruption into the day-to-day business function of the organization, and many will tell you they give verbal feedback to their employees all the time.  Verbal feedback is important, yes, but it’s not documented.  The vast majority of employees, whether they’re willing to admit it or not, appreciate the time, attention, and effort a manager puts in to documenting their performance.  Formal performance reviews should be conducted at least annually, and special performance documentation should happen throughout the year whenever something exceptional occurs – good or bad.  This special documentation doesn’t need to be anything fancy or lengthy, nor does it need to be signed by the employee.  It should include name, dates, time, description and location of the event, any witnesses, and a summary of the action you took.  If you give an employee a verbal warning, then document it as a verbal warning and summarize what you told the employee, including what corrective action he/she should take and reasonable time to fix the problem.
  4. Communicate and Be Consistent. Make it well known in your organization that meeting performance objectives is crucial to the success of the company.  Develop and post a mission statement.  Consider displaying individual and team performance metrics in prominent areas in the workplace.  Use a consistent and fair evaluation processes for all employees at each level (i.e. exempt/non-exempt; sales, administration, management, etc.).
  5. Improve Your Hiring Methods. If you hire the right person in the first place, you can generally avoid all this mess.  Standardize your screening process to include: careful reviewing of resumes, phone interviews, review of detailed employment applications, on-site interviews with appropriate questions directly related to the vocational and dimensional qualifications for the position, reference checks, management discussion of top candidate(s), the offer letter, and background check (if required).  Failure to conduct due diligence on a prospective new hire puts your company and employees at risk!

Don’t fall prey to the false sense of protection the “at-will” doctrine appears to provide.  Just as you wouldn’t hire someone “at-will” solely because you think the candidate is a good fit for your company, neither should you fire an employee “at-will” solely because you think the employee is not a good fit.  Both employment decisions – hiring and firing – should be made after prudent consideration, effort, and documentation.  Thus, you can be confident that your “at-will” decision is justifiable, “for a particular reason,” and in the best interest of the company.

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Written by Dan Hettrich

June 9, 2011 at 6:50 pm

Posted in Uncategorized

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