Firing and Termination: Doing It Right, Legally and Humanely

Nobody Likes Doing This

Firing someone is the hardest thing a business owner has to do. It's uncomfortable, emotional, and carries real legal risk if you handle it poorly. But keeping the wrong person is worse -- it damages your team, your culture, and your business.

The goal isn't to avoid firing people. The goal is to do it right when it's necessary.

Before the Termination

Make Sure You Have Grounds

In an at-will employment state (most states), you can technically fire someone for any reason that isn't illegal. But "can" and "should" are different things. Before you terminate, make sure you have:

• Documented performance issues: Written warnings, PIPs, coaching notes
• Consistent application: Have you treated this employee the same as others in similar situations?
• No discriminatory motive: Are you terminating for a legitimate business reason, not because of a protected characteristic?
• No retaliation: Has this employee recently filed a complaint, requested accommodation, or engaged in protected activity?

If you can't clearly articulate the reason for termination and back it up with documentation, you're not ready to fire this person.

Consult an Attorney

For anything beyond a simple, well-documented performance termination, talk to an employment attorney first. This is especially important if the employee is:

• A member of a protected class
• On leave or returning from leave
• Pregnant or recently pregnant
• Over 40
• Someone who recently filed a complaint or workers' comp claim

A 30-minute call with an attorney can prevent a six-figure lawsuit.

Prepare the Paperwork

Before the termination meeting, have ready:

• Final paycheck (some states require immediate payment on termination)
• COBRA notification information
• Separation agreement (if applicable)
• Return-of-property checklist
• Information about unemployment insurance
• Any severance terms

The Termination Conversation

Logistics

• Schedule it privately. A conference room or office with a closed door
• Have a witness present -- ideally another manager or HR person
• Do it early in the day and early in the week if possible (not Friday afternoon)
• Keep it short: 10-15 minutes maximum

What to Say

Be direct. Don't start with small talk. Don't bury the news in a 20-minute preamble. Open with the decision:

"I've made the decision to end your employment, effective today."

Then briefly state the reason:

"As we've discussed in your written warnings on [dates] and your performance improvement plan, the quality of your work has not met the standards we need for this role."

What Not to Say

• Don't apologize excessively: "I'm sorry" once is human. Repeating it undermines the decision
• Don't argue or debate: The decision is made. This isn't a negotiation
• Don't get personal: Stick to performance and business reasons
• Don't make promises you can't keep: Don't promise references or rehire eligibility unless you mean it
• Don't say "we're letting you go": Be direct. The word is "termination" or "ending your employment"

Handle the Reaction

People react to termination in different ways: anger, tears, silence, disbelief. Be empathetic but firm. If the employee becomes verbally aggressive, calmly end the meeting. If there's any physical threat, call security or law enforcement.

After the Termination

Final Pay

Check your state's law on final pay timing. Some states (like California) require immediate payment upon termination. Others give you until the next regular pay period. Include all earned wages, accrued PTO (if your state or policy requires payout), and any expense reimbursements.

Benefits Continuation

Under COBRA, if your company has 20+ employees and offers group health insurance, the terminated employee has the right to continue coverage at their own expense. You must provide COBRA notification within 14 days of the qualifying event.

Unemployment Insurance

In most cases, terminated employees are eligible for unemployment benefits. Employees fired for documented poor performance generally qualify. Employees fired for gross misconduct (theft, violence, drug use) generally don't. Your state unemployment office will contact you -- respond promptly and honestly.

Recover Company Property

Have a checklist: keys, badges, laptop, phone, credit cards, uniforms, tools, vehicles. Disable electronic access (email, systems, building access) immediately or before the meeting if security is a concern.

Communicate With the Team

Your remaining employees will know someone was fired. They'll also be wondering if they're next. Address it briefly and appropriately:

"[Name] is no longer with the company. I'm not going to discuss the details out of respect for their privacy. Here's how we're going to cover their responsibilities going forward."

Don't badmouth the terminated employee. Don't lie about the reason. Keep it professional.

Avoiding Wrongful Termination Claims

The best protection against wrongful termination claims is consistent, documented, good-faith management:

• Document everything: Performance issues, coaching conversations, warnings, improvement plans
• Be consistent: If you fire one person for excessive absences but give another person a pass, you have a problem
• Follow your own policies: If your handbook says three warnings before termination, give three warnings
• Don't retaliate: Ever. For anything
• Keep the reason honest: If you fire someone for "restructuring" when it was really performance, that lie will come out in a lawsuit

Severance Agreements

You're not required to offer severance (unless contractually obligated), but it can be worth it. In exchange for a severance payment, the employee signs a release waiving their right to sue. For employees over 40, the Older Workers Benefit Protection Act requires a 21-day consideration period and 7-day revocation period.

Severance amounts typically range from one to four weeks of pay per year of service, but there's no legal formula. Have an attorney draft the agreement.

The Humane Part

Losing a job is devastating. Even when the termination is completely justified, the person on the other end of the table is having one of the worst days of their life. Treat them with dignity. Let them collect their things privately. Don't escort them out in front of coworkers if you can avoid it. It's possible to be both firm and kind.