Avoiding Wrongful Termination Claims in Texas

Texas courts presume that individuals hired for an indefinite period are “at-will” employees. This means that either party may end the employment relationship at any time and for any reason that is not prohibited by law, including a “good reason, a bad reason, or no reason at all”. However, employers engage in wrongful termination if the termination violates a statute or the employee is let go for refusing to perform an illegal act.

Wrongful termination suits permit employees who believe that they were fired for an unlawful reason to sue their employer and potentially recover civil monetary damages. Employers who fail to consider implementing a business plan geared towards minimizing wrongful termination risk large monetary penalties, as well as costly, litigation.

Common Kinds of Wrongful Termination Claims

Federal anti-discrimination statues make it unlawful to terminate an employee based on their protected characteristics such as race, color, religion, gender, age, national origin, or disability. Employers violate anti-discrimination statutes if they terminate employees simply because of their protected characteristics rather than for deficient performance or another legitimate business purpose.

Additionally, there are over 53 separate Texas laws that prohibit retaliation based on the employee engaging in specific activity. In other words, employers that fire employees because they engage in legally protected conduct can be sued for wrongful termination.

How Can Employers Protect Themselves?

• Implement Clear and Consistent Policies

One of the best ways that employers can avoid wrongful termination lawsuits is to create, implement, and follow clear termination processes. Having these policies give supervisors and managers appropriate directives to look back on in the event they need to terminate an employee.

Furthermore, employers must consistently enforce established policies. For employers, consistency is one of the key factors in avoiding wrongful termination claims. Federal laws and regulations require that all staff are treated equitably. If an individual can prove that their employer exercised unequal treatment regarding their termination, this can support a wrongful termination claim based on discrimination.

• Documentation

Providing proper and appropriate documentation during a wrongful termination suit can help employers reduce the risk of liability. During any employee’s time at a company, employers should document any performance deficiencies, as well as conduct regular performance reviews. This kind of documentation shows exactly why an employee was terminated. When documenting

an employee’s performance, it is important for employers to remember to always use clear language. Plaintiffs can easily weaponize vague language against their employers, such as “bad attitude”. Instead, documents should point to the company policies that were violated, missed assignments, and documented internal or external performance complaints received from third parties.

Performance Improvement Plans (PIPs) are extremely helpful because they allow employees to understand issues in their performance prior to termination and create opportunities for improvement. Also, PIPs create a record of legitimate business reasons for termination that can be used in the event of litigation.

Employers should be sure train supervisors and managers on documentation standards, lawful performance review practices, and appropriate communication.

• The Proper Handling of Termination Itself

Poorly handled terminations can often fuel an employee’s choice to pursue litigation more than the actual underlying termination. It is best to only communicate with necessary parties regarding the reasons why an employee was let go and attempt to end the employment relationship as amicably as possible. Lastly, while employers do not have to give advance termination notice, if they have minimum notice periods required under their own company’s policy or state law provides otherwise, then they must stick to those guidelines.

• Keeping Confidentiality

Employee rights include protection of confidential information and trade secrets. A breach of confidentiality can open an employer up to a powerful wrongful termination suit. All information regarding termination of an employee should be kept confidential by ensuring that documentation is kept in a secure location that is not readily available to everyone.

Bottom Line

Employers should implement best practices in regard to the termination of an employee, including the implementation of clear and consistent policies, the use of proper documentation, the proper handling of termination itself, and keeping confidentiality. Doing this is extremely important for employers to reduce their legal risk against all kinds of wrongful termination claims.