Firing Employees | Knowing Your Risk of Lawsuit

Why Should You Know Your Risk When Firing Employees?

You must know your risk level when firing employees because it tells you which roadmap to use for each termination. If you don’t know your risk, you'll make mistakes when firing employees that could lead to an expensive lawsuit.

Here’s an example. When you treat a low-risk firing like a high-risk one, you'll award a larger severance package than you need to. So, you must determine your risk before you fire a worker.

Here’s how to determine your risk.

In the past, we often did this on intuition, and you can still employ this method. You can intuitively feel which staff members will file a lawsuit and win unlawful dismissal suits. From these perceptions, you can then categorize the termination as low, medium or high-risk.

I personally hate using gut feeling for such an essential matter. To make this more precise, I created the Termination Risk Estimate & Protection System™. This is the only method which gives you useful methods for estimating termination risk. Chapter Four of the Employee Termination Guidebook demonstrates you how to use this method. You’ll find it very easy to use

Whether you use gut instinct or my Termination Risk Estimate & Protection System™, how you fire workers at each risk level is clear-cut:

With a low-risk termination, you can cleanly fire the worker or lay her off with a handshake. You don't need to give a separation package.

With a medium-risk termination, you fire the employees but are ready for negotiation after the firing. As part of your severance package, you offer the workers extra separation money and benefits in return for agreements not to sue you and your company. Normally, the workers will sign the release and take the extra money. And you don’t have to worry about lawsuits any more.

With a high-risk termination, you don't fire the staff member, but negotiate her resignation. You give her a healthy separation package and she agrees not to sue you.

By following these directions, you're terminating correctly and you can stop worrying about a wrongful termination suit. To find out more details on how you can terminate properly and without risk, click firing employees.

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