|February 17, 2014|
Previously published on Winter 2014
The decision has been made, but the ship hasn’t yet sailed. Somebody has to deliver the bad news and as difficult as this might be, there are a couple of things employers will want to know about before going into the meeting. Here are some practical tips to reduce potential risk associated with the termination meeting.
Tip 1 - Decide on Your Approach
Once the decision to terminate is made, an employer still has to decide how it will be carried out. Terminations can be for cause or without cause on reasonable notice. Reasonable notice can be working notice or pay in lieu of working notice. Further, employers may wish to sweeten the offer above strict legal entitlements in order to obtain a release. Such decisions have to be made in consultation with legal advisors and in accordance with any contractual, statutory and common law requirements.
Tip 2 - Prepare the Termination Package
Have a termination package ready to be delivered at the meeting. Ideally, this should include the termination letter, final pay, summary of benefit options (specifically whether group benefit plans can be covered into an individual plan and location of any RRSP’s), and even the Record of Employment (ROE) (or confirmation that the ROE will be filed electronically within five business days). If the termination is without cause, consider offering outplacement counselling through an independent third party.
If an offer is being made and some negotiation is expected (in order to obtain a release) consider providing a fixed sum for the employee to obtain independent legal advice. What goes in a release is discussed in our The Three Written “R”s: References, Reasons and Releases section. Although setting aside a signed release is rare in Canada, in Rubin v. Home Depot Canada Inc., a recent decision from Ontario, the court set aside a release on the basis of “unconscionability” and that decision reminds us to exercise caution when it comes to releases and what happens in the termination meeting. Ensure that the employee is provided a period of time before signing a release and as a general rule, never allow an employee to sign a release at the termination meeting.
Tip 3 - Preserve the Employee’s Dignity
Once the path is chosen, then it’s time to carefully prepare for the termination meeting so as to deliver the message, and termination package, in a firm but respectful manner. Termination meetings are rarely pleasant, but a carefully executed meeting can minimize the extent of frustration and anger of the employee and the stress of management. Shattered egos, perceived insults and hurt feelings lead to litigation. An employee who walks away feeling respected and valued (even in the face of conflict) will be much less likely to engage in litigation and/or make disparaging remarks about the employer.
Termination meetings should always be held face-to-face, not through mail or over the phone. Let the manager who has the most connection with the employee take the lead. Choose a location away from other employees and interruptions. Avoid Fridays and the day before a holiday so that the employee has better access to support (legal, counselling, medical) in the days following the termination. As a general rule avoid birthdays, days immediately before vacations, etc. For unionized employees, ensure that collective agreement requirements for union representation are met.
Tip 4 - Be Ready for a Q&A
Proper preparation means considering the questions an employee is likely to ask and being prepared to answer them. Regardless of whether the termination is with or without cause, employees will always want to know the reason. Ensure the manager conducting the meeting has a brief, one sentence answer. In without cause terminations, avoid relying on “shortage of work” if there is really no shortage and you intend (or already have) hired a replacement. Something as simple as stating the employee is simply not a good fit with the company is perfectly acceptable. Never get drawn into arguments/discussions/ negotiations as to whether or not the employee should or should not be terminated - at this point your decision is final. Be prepared to discuss what level of reference you are prepared to provide the employee. Have two management personnel (but no more so as not to be overwhelming) at the meeting if possible so there is a witness to what was communicated.
Tip 5 - Ensure Property will be Returned
A meeting is also an opportunity to ensure that company property, phones, passwords, keys, credit cards, etc. are obtained before the employee walks out the door. Also, ensure the employee has an opportunity to go to their space and retrieve personal items. Once the meeting is over, change passwords and access codes as soon as possible.
What this means to you
Severing employment relationships is difficult and can be emotionally charged. However, proper preparation and sensitivity will minimize the risk of a claim. Follow the golden rule - treat the employee as you would like to be treated, and when in doubt obtain specific legal advice.