* Do a postmortem. Each time you fire someone, review your firing process. What was unacceptable about the fired person? How could you have predicted it in the hiring process? How could it have been corrected in the managing process? If you don't change anything after firing someone, then you're doomed to repeat the mistake.
Your firing experience could be the best instructor you ever have. Not just because firing is something every business owner has to learn, and not only because you'll learn to hire better. What happens is simple: a thorough analysis of your firing requires you to change your focus from solely your product or your market to managing human beings. What you'll be able to achieve with a high-quality, well-managed work force coupled with that really terrific product or unique marketing approach will lift you a magnitude above what you'll get from products or marketing alone. Getting there is not quick or painless. But it's the right journey to be making.
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Research assistance for this article was provided by Karen E. Carney
THE BARE MINIMUM
The Five Basic Steps of the Firing Process
Wrongful-termination suits filed over the last 20 years have skyrocketed by more than 2,000% (compared with the 125% that overall civil cases have grown by in the same time period). We're not recommending you install a purely defensive firing strategy, designed to prevent lawsuits by disgruntled former employees. But you should know what legal experts advise clients about firing an employee over performance problems. Here are the five steps of a bare-minimum firing process:
1. Act on problems immediately. Employees most likely to sue you are those who feel their firing was unjust, indefensible, or discriminatory. So you must communicate with them about weak performance immediately. A minor problem can be handled in an annual performance review and follow-up meetings. Larger shortcomings should be conveyed right away and tracked through weekly or monthly sessions.
2. Document carefully. Write memos about your talks with employees. Be extremely specific in both talks and memos. Don't simply say that the employee doesn't have the proper attitude, enough initiative, or the ability to get along with people. Substantiate your characterization by describing instances. Give a copy of any memo that goes into an employee's personnel file -- and there should be one for every session with an employee -- to the employee.
3. Include the employee. Have employees evaluate themselves. If the employee acknowledges the problem, then you'll be much closer to solving it. "If the employee denies the problems, the employer has the additional ammunition -- if this ever goes to court -- of being able to show that the employee did not respond to constructive criticism," says Eric Wallach, a partner at Rosenman & Colin, in New York City.
4 . Act quickly. If the employee's performance does not improve, don't sit on the decision. That could look as though your company wasn't seriously affected by the worker's subpar job, weakening your grounds for dismissal. There is no legal requirement that you issue a warning or put a worker on probation. But you must follow your company's policy as laid out in your employee handbook, if you have one. If you're firing your only female or minority worker, that employee could argue the termination was discriminatory. Your comprehensive record (numbers two and three above) should reflect that poor performance is the reason for dismissal.
5. Be candid. Candidly and clearly, tell the employee why he or she is being terminated. Be prepared to make your severance-pay and benefits proposal. Have someone else from the company present to witness and record the termination and the employee's response to it.
RESOURCES
For managers on the firing line
Every year more than 3 million Americans are fired or laid off by employers seemingly ill-equipped to deal with claims of wrongful discharge. To avoid potential courtroom appearances, you should master the art of preventive employee relations. Thinking about firing an employee? You can do it humanely and legally while staying out of court, and guarding precious cash, by taking a few tips from the experts.
E. Kenneth Snyder's Employee Matters: A Legal Guide to Hiring, Firing and Setting Employee Policies (Probus, Chicago, 800-776-2871, 1991, 173 pages, $24.95), written for the legally untrained executive, clearly and thoroughly lays out tried-and-true methods for creating effective personnel policies and resolving employee complaints. When litigation is likely, the guide offers strategies for minimizing damages and maximizing the chances of a favorable ruling.
BNA Plus (800-452-7773, 202-452-4323 in Washington, D.C.), the Bureau of National Affairs' research arm, publishes model procedures for discharging employees and conducting exit interviews and audits and will send them to you for $23 plus $5 shipping and handling.
The Friedman Group, an executive training and consulting firm, produces a no-nonsense video, "How to Legally Fire" (800-351-8040, 40 minutes, $79). The concise program lists the dos and don'ts of firing, shows how to test for "just cause," and demonstrates negotiating skills. It also shows employers how to avoid firing altogether by taking corrective action to enhance employee productivity. The video comes with a helpful workbook chock-full of diagnostic checklists.
If all's lost and you're ready to fire, contact Margaret Bryant (914-328-0404) of Jackson, Lewis, Schnitzler & Krupman, labor-law specialists. She'll fax you the firm's soup-to-nuts "Termination Checklist," a 4-page quiz on discharge basics and firing techniques. It's appropriate for all levels of an organization.
