From the Hotline: Terminations During a PIP

Question: Can an employer terminate a manager’s employment during a performance improvement plan period?

Answer: With any termination of employment situation, we recommend that you consult with your legal counsel to review the facts and circumstances of the situation to mitigate any potential risks.  At-will employers generally have the right to terminate the employment relationship at any time; however, if this employee is covered by a collective bargaining agreement, you should review the terms of the contract.  In addition, ensure that you are following your company discipline rules as well.

An employer can make such employment-related decisions based upon business necessity and in accordance with Company policy and based on past precedent for consistency.  If you are considering immediate employment termination, then ensure that this follows your policies.  If the performance improvement plan (PIP) is written in such a way that seems to guarantee employment through the “expiration” date of the PIP that can be problematic. Generally, PIPs should have some sort of caveat that failure to improve, including violation of ANY company policies, can result in immediate employment termination.  In other words, ensure that the “punishment fits the crime.”

Communicate the business reasons for the decision for immediate employment termination rather than progressive discipline to the employee and document all discussions in the event of a claim of wrongful or discriminatory termination.