Wrongful Termination

Complete Guide for Employers

Wrongful Termination
Learn what constitutes a wrongful termination, the potential consequences, and how to avoid being sued for it.

Last updated November 19th, 2017

A wrongful termination occurs when an employee is fired for illegal reasons. Wrongful termination is also known as unlawful termination, wrongful dismissal, or wrongful discharge. An employee can be reinstated or sue if there is a case of wrongful termination.

A Termination May be Wrongful If:
A Termination May Be Wrongful If
  • It is based on religion.
  • It is based on race or ethnicity.
  • It is based on disability.
  • It is based on gender.
  • It is in retaliation for a legal complaint.
  • It is in retaliation against a whistleblower.
  • It does not follow the employer’s own guideline for termination.
  • It is because an employee refused to commit an illegal act.

At-Will Employment and Wrongful Termination:

Most employees in the U.S. work at-will, which means an employer can fire them at any time, for any legal reason. This can protect employers from wrongful termination. However, there are several common situations when an employee may not be considered at-will.

How to Avoid Being Sued for Wrongful Termination:
How To Avoid Being Sued For Wrongful Termination
  • Document performance issues and behavioral issues.
  • Make employees aware of issues when they happen.
  • If possible, give employees opportunities to correct problems.
  • Do not imply a promise of job security.
  • State in your employee handbook that employment is at-will.
  • Follow established company procedures for termination.

Final Thoughts:

Obviously, you should never fire someone for illegal reasons, such as their race or gender. But to avoid being sued, it’s also important to document your reasons for terminating an employee so that you can prove it was not done for illegal reasons.