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What is the best way to fire an employee to avoid a lawsuit?

When firing an employee in Maryland or any other state, it is important to do so in a way that reduces the risk of a wrongful termination lawsuit. Accordingly, it may be worthwhile to document any poor performance reviews or customer complaints the employee received. It may also be advisable to point out any action steps or suggestions that the employee was given to improve his or her performance.

Letting an employee go in a transparent manner will give the employer evidence to point to if taken to court. In addition to documenting all the reasons why an employee is let go, it is important to time the termination properly. While many states have an at-will termination policy, the terms of an employee's employment contract may prevent an employee from being terminated for any reason other than those enumerated in the agreement. Breaching the contract may be an easy way to lose a lawsuit.

Federal and state law set forth certain criteria for which employees cannot be fired. For example, it is illegal to fire an employee based on that person's gender, sexual orientation or religion. It is also illegal to fire an employee due to any actual or perceived whistle-blowing against the company. However, employees can be terminated for lying, stealing or harassing other employees at any time.

Employers may wish to exercise care when terminating an employee as it could bring about a lawsuit. While employers can take steps to avoid lawsuits, they can be costly even if the company wins the case. Talking to an employment law attorney can help create employment documents that may reduce the odds of an employee trying to take an employment dispute to court.

Source: Entrepreneur, "4 Secrets to Firing Your First Employee", Heather R. Huhman, October 14, 2014

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