Employees Must Be Given Written Notice of Termination of Employment
Whenever an employer discharges, lays off, or places an employee on leave of absence, the employer must give the employee a written notice regarding the change in status. The notice must contain, at a minimum, the employer’s name, the employee’s name, the employee’s social security number, the date of the action, and whether the action was a discharge, a layoff, a leave of absence, or a change in status from employee to independent contractor. Significantly, the notice need not address the reason for the change in status. Thus, if you are terminating an employee for theft, you are not required to commit that to writing.
Employers should be very careful when providing a reason for a termination decision. It can be tempting to blame the decision on factors outside the employee’s control, such as a slow-down in business, when the real reason is poor performance. If litigation follows, the employer will want to rely on the poor performance as the true reason. However, at that point it will look like the employer either lied in the termination notice, or is now lying regarding the misconduct. Either way, the employer will have lost all credibility and will be at a significant disadvantage in the litigation. Therefore, the employer should either (1) give the true reason at the time of discharge, (2) give no reason at the time of discharge; or (3) give a reason that is sufficiently broad and vague that the employee is satisfied, but that will not preclude a more precise explanation later.