Legal procedures for layoff and termination of employee’s contacts
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Legal procedures for layoff and termination of employee’s contacts
The Covid-19 pandemic has hit the business sector so hard, and after the crisis, there will be a considerable loss of jobs in the globe. Most businesses will barely have the required capital to run normal activities due to damages arising from the perishing of goods and expiry of the inventory, which was stored in the warehouses before the pandemic. The transport industry is also struck due to the fact that most countries have initiated a total lockdown hence limiting the rate of locomotion. The rate of unemployment is expected to rise drastically globally due to the fact that most companies are expected to initiate different measures to try and remain solvent and continue with business activities this paper will cover comprehensive research on the possible ways that businesses can use to layoff and reduce the employee burden without violating the laws. Due to the crisis, companies will be expected to apply a lot of pressure to their employees to achieve the required targets, and consequently, non-performing employees will be fired. The paper also aims to offer guidance on how to fire non- performing employees in a proper way.
Whether your company must downsize for economic termination of an employee is never received well by the employee; hence the company must follow set procedures to avoid falling in the trap of expensive lawsuits.
Employer’s Rights
An employment contract is a final document that obligates an employer to follow protocol in firing or laying-off an employee or a number of employees. Under the law in most nations if there is no contract that binds the employee with the employer legally, then the employer can fire or layoff an employee at will and will not be apprehended by the law as long as the organization presents the right reasons that initiated their actions (Leveque, 2018). If an employee is an employer is under contract, then the deal has to specify terms of termination, which will be used to stop the employee from continuing to work for the stated employer. A written contract is the most binding contractual agreement since it can be presented on the court of law and the employer can be made to pay damages as stated in the contract; however, an oral contract always faces validity doubts and therefore the employee is fired or retrenched only on causes like poor performance and acts of dishonesty.
The right to fire at will has been limited over the years as courts have recognized and initiated exceptions that protect employees who are not under contractual obligation from being fired legally. An organization which is aiming to fire employees at will after the covid-19 pandemic should know that the following exceptions offer the guidelines to the limits of at-will employee termination;
- Discrimination
Under the federal law, it’s a criminal offense for a business organization to use discriminatory ways while terminating its workers this forms of prejudices include terminating workers using phenomena such as age, race, religious affiliations or nationality for example in many states in the united states you can’t fire employees using a criterion of sexual preferences.
- Public policy
An organization cannot fire or terminate employee contact for reasons that violate public policy. The public policy states how business entities should behave in their activities; a company can’t fire an employee for following the public policy, for example, you can’t fire your employee because he or she reported that the company isn’t paying taxes.
Potential charges that can arise from layoffs, and how an organization can avoid them.
- Charges of discrimination.
After the layoff, most employees are likely to address issues of discrimination and harassment during their termination; hence a business organization has to be very sensitive during issuing layoff statements. When trimming payrolls or laying-off employees, caution has to be taken, especially in the organization and selection of who gets the layoff. Prior to the layoff decisions company should come up with a good criterion and analyze it thoroughly to avoid bringing more problems than good. Using objective criteria like eliminating a type of position that has become irrelevant after the pandemic will be a proper way to go.
- Workers’ adjustment and retraining notification act (WARN).
This act addresses companies with a number of employees surpassing a hundred who work a total of four thousand hours per week. This act aims at protecting workers who are employed by large business entities in the corporate world from mass layoffs without notification. A business organization is obligated to issue a sixty-day notice to affected employees before the actual lay off date. Decision-makers in any business entity fitting the above description need to work closely with this act to make sure that all the legal specifications of this act are followed tote later so as to be on the safe side of the law after the layoff. This act, however, covers enforceable circumstances such as the indefinite closure of businesses due to the covid-19 pandemic. This act was reinstated in the United States in 1988. The early notice is aimed to give employees ample time to prepare for the economic difficulties that can face them after the layoff. Also, the employees are allowed to seek for other employers at this moment and can also ether training programs that can make them competitive in the job market after the layoff (Chunyu,2018).
Employees unprotected by the WARN act include workers who have participated in
strike actions. The nature of the work also can exempt one from protection by this act, which in this case includes workers employed on temporary projects or employees who already understand the temporary nature of their assignment in an organization. employers who cannot be apprehended by this act include;
- Employers who close a temporary facility and the employees working there are temporary employees who were employed with the knowledge that their contact seizes to be in action immediately after the project is over.
- An employer who closes a facility or the whole organization indefinitely due to workers strike, a lockdown or workers go slow exercises will not be brought to law using this act due to the fact that the employer is not intending to evade the sixty-day notice but is protecting the business from destruction from malicious employee activities.
- When the employer lays off employees less than fifty workers in a single operational site, the employer will not face the legal charges through this act.
Exceptions to the WARN act are mostly claimed through claims of bankruptcy, which are handled by bankruptcy courts. When an employer continues to do business activities after the declaration of bankruptcy, then the WARN act will put the stated employer to book since it’sit against the law. Violation of the WARN act attracts penalties to the organization which includes liability to each employee who has been laid off illegally for the stated sixty days; this means that the business organization will pay the salaries and all the benefits that we’re entitled to each employee laid-off in the period of sixty days.
Verbal abuse and words used during firing, retrenching, or laying off employees can form the basis for possible law suits. There are procedures that can guide the management to avoid potential violations of law during speeches and issuance of layoff statements. The administration or the authoritative person who is to participate in issuing statements and speaking on behalf of the organization should be appealing to the employees and have a full understanding of the legal issues that bind him or her during the statements made regarding employees ‘ loss of jobs. It is advisable for the management to have reliable explanations as to why the employees are being laid off or retrenched, and it should be communicated in a way that the employees fully understand and questions that the employees will ask should be addressed with respect and regard to making the layoff process as legal as possible.
When a company fully offers the required information to the employees, then the employees will have a clear understanding of the real situation on the ground like in the case of a covid-19 pandemic the organization can give a clear explanation to the economic impact of the epidemic and the problems that may arise if the employees continue working in the organization. Goodwill from employees and the excellent relationship even when the employees are being terminated from working in the organization reduces the legal risk in an organization and hence giving the organization an ease time after the covid-19 pandemic.
In conclusion, layoffs are the most expected occurrences after the covid-19 epidemic the following steps will offer a guideline to a business entity and leaders in the corporate world with a procedure to follow during layoffs in a bid to avoid legal actions against them by employees affected;
STEP ONE: Selecting employees for layoff
After fully designing the future organization strategies, the organization has to come up with the most suitable system, which will determine who stays and who is laid-off. The developed criteria of layoff should be reflecting company goals and not just a way of getting read of excess employees. This plays a critical part in making the legal system understand the nature and the cause of retrenchment. Some of the subjected basis of reduction or layoff can be skills, seniority, and job performance. The company should avoid as much as possible any acts that can be seen as discriminatory in nature.
STEP TWO: Avoid adverse action/ disparate impact
A thorough revision of the selected group of employees being laid off to determine cases of harmful effect for a section of protected individuals. Some of the typical protected class includes certain race, color, ethnicity, or gender. Other issuers that can lead to adverse action include cases of religious affiliations or sexual preferences un proper revision of the selected employees can land the organization into law issues when the protected class is affected deeply in the layoff.
STEP THREE: Reviewing of the older workers’ Benefits Protection Act.
Age is an important issue which an organization should put into consideration when laying off employees this act protects employees of a certain age bracket depending on specifications from different states. In most cases, there are benefits and protection of employees aged forty years, and above this puts the organization under obligations to address the issues stated in this act to prevent future lawsuits(Lahey 2008).
STEP FOUR: Reviewing the Workers Adjustment and Retraining Notification (WARN)
This act provides employees with the required information on who is protected and who is not, so basically, it serves to give a protocol and to make the layoff as quick and smooth as possible. Through the revision of the WARN act, employers get an advantage to identify individuals who are not protected by the act and hence avoiding breaking the law as much as possible. The act also serves to reduce possible resistance from the employees since it offers the ways and timelines on which information is supposed to be communicated to the employees. Full review of this act also offers the management with options available within the law to conduct the layoff, and through comparisons with different acts, the organization can have the best system designed to conduct the best layoff procedure.
STEP FIVE: Actual layoff
During this period, the organization needs to pay attention to the communicative part of the process in that the employees being laid off should be given all the information that matters to them. Avoiding verbal abuse should be done to protect the organization from possible law violations in that the organization should appoint a recognized team of individuals who will conduct the activity from the start to the end addressing all the required procedures.
References
Chunyu, L., & Tran, A. L. (2018). Labor Restructuring and Acquisitions: Evidence from State Adoption of the Worker Adjustment and Retraining Notification Act. Available at SSRN 3333114.
Lahey, J. (2008). State age protection laws and the Age Discrimination in Employment Act. The Journal of Law and Economics, 51(3), 433-460.
Leveque, K., & Cartwright, A. (2018). Navigate various legal issues surrounding workforce reductions. Campus Legal Advisor, 19(4), 1-5.