Hiring a new employee can create liability for employers well before that worker even receives their first paycheck. When terminating an employment relationship, employers also face serious liability issues if they do not handle the process properly.
From the language used in an employment contract to the terms within a severance agreement, it is critical for employers to protect their interests and ensure they comply with the applicable employment laws. Our Knoxville employment lawyers can help you avoid disputes, reduce unnecessary costs, and set clear expectations from the beginning.
Do Not Make Promises You Cannot Keep
It is important to remain cautious about any promises you make during an interview or employment contract negotiations. Guarantees regarding compensation, job security, bonuses, promotions, or the expected length of employment can become evidence later if there is ever a dispute.
For example, saying that an applicant “will always have a job here” can create issues if you later terminate the worker. Even statements made casually can be taken out of context or misunderstood. You should also train managers and supervisors to avoid making promises they cannot keep. Reviewing offer letters, job descriptions, and employee handbooks can also ensure they do not create contractual obligations you do not intend to fulfill.
Put Important Terms of Employment in Writing
Drafting a clear, written job offer can help you avoid misunderstandings. Depending on the circumstances, an offer can outline compensation, benefits, job duties, start date, and other important employment terms.
It is also important for a job offer to reflect the employment relationship accurately. If you intend for the employment to be at-will, as allowed by Tennessee law, you should state this in an employment agreement or job offer, and any other important company materials.
It is important that you never rely on standard templates of agreements, as the language used may not accurately fit the position or state or federal laws.
Conduct Background Checks Carefully
Conducting background checks can help you make informed hiring decisions, but they can also create legal obligations. For example, if you plan on using credit reports for employment purposes, you may have to disclose this fact and obtain authorization from potential candidates, under the Fair Credit Reporting Act.
It is also critical that you use the same screening policies for all potential employment candidates. If you use different standards for different applicants, it can raise concerns of discrimination, particularly if protected characteristics are involved.
Document Employment Decisions Thoroughly
One of the most important tools when limiting employer liability is thorough documentation of all decisions. If you eventually fire an employee, this documentation can show the reasons were legitimate and nondiscriminatory.
It is important to document all policy violations, attendance issues, disciplinary records, performance evaluations, and other relevant communication. It is just as important to ensure decisions are documented consistently and accurately. Do not use personal opinions or inflammatory language that can later be against you or the business.
Be Consistent with Terminations
Before making any decisions regarding termination of an employee, it is critical to consider whether other employees in similar situations have been treated the same way. Inconsistent disciplinary decisions can raise issues regarding whether retaliation, discrimination, or another illegitimate motive influenced your decision.
If you feel as though you need to terminate an employee, you may want to review the worker’s history, any previous disciplinary actions against them, relevant company policies, and the circumstances surrounding the possible firing. If you feel that the employee will dispute the termination or take other action, it is critical to speak to a Knoxville employment lawyer before taking any disciplinary action.
Know the Full Purpose of Severance
Providing severance pay gives you the opportunity to resolve any potential disputes while offering financial assistance to someone leaving the company. Too many employers make the mistake, though, of treating severance as a lump sum payment in exchange for a signature.
A severance agreement that is properly drafted can include a release of certain legal claims, return-of-property requirements, and other terms designed to protect you and the business. It is critical that you clearly state what the employee is receiving in exchange for the promises they are making.
Pay Particular Attention to the Release of Claims
The release of claims is one of the most important aspects of any severance agreement. A release states that the employee agrees not to take any legal action against the employer. However, using a broad release may not waive all of an employee’s rights or claims. For example, employees are often protected from participating in investigations, filing a claim such as age discrimination within a certain time period, and communicating with government agencies.
Instead of using a boilerplate release, it is critical to draft an agreement with the specific circumstances in mind.
Provide Enough Time for Employees to Properly Review the Agreement
After ensuring you have a properly drafted severance agreement, it is just as important to give employees plenty of time to review the contract. Never pressure any employee into signing these agreements. Even if there are no mandatory review timeframes, providing a reasonable amount of time for workers to review a contract can minimize the chance of future claims stating the agreement was signed through coercion.
Advising any employee to obtain legal advice before signing a severance agreement is also highly recommended. This can strengthen your position if the employee wishes to later challenge the agreement.
Our Employment Lawyers in Knoxville Can Protect You and Your Business
If you are thinking about hiring new employees, terminating a current one, or entering into severance negotiations, it is critical to consult with a Knoxville employment lawyer. At The Ebbert Law Firm, our experienced attorneys can review the facts of your situation, draft the necessary agreements you need, and ensure they are properly executed so you and your business are protected. Call us today at (865) 503-4454 or fill out our online form to schedule a consultation and to get the legal help you need.