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Top 3 Legal Issues Businesses Should Be Aware of When Terminating an Employee

Oct 01, 2023

Terminating an Employee? Not So Fast. Top 3 Legal Issues Businesses Should Be Aware of When Terminating an Employee

There are many times an employee is not performing properly, or the relationship is simply not working and the company needs to let the employee go. When a business terminates an employee, its risk of getting sued by that employee increases exponentially. 

Even if the business is in an “at will” state, there are certain things businesses need to be aware of when terminating an employee. 

Is the employee “at will” or is there an Employee Agreement?

Be sure to check the employee file to make sure there is no employment agreement that was signed by the business and employee. If so, there may be certain restrictions as to how and when the employee can be terminated. If a business proceeds with a termination in violation of the terms of an employment agreement, even in an “at will” state, the business could face legal liability.

Wrongful Termination

If the employee is terminated, is there a potential for a discrimination, retaliation or other type of “wrongful termination” type claim. Just because an employee may be “at will” does not necessarily mean the business is insulated from liability or lawsuits.

If the employee has recently (as a general rule of thumb, in the past 4-6 months) done any of these things, there could be a potential retaliation claim:

  •  Disclosed a medical condition or inability to work due to a medical condition
  •  Complained of not being treated fairly
  •  Complained of not being paid properly (wages, overtime, equal to what other employees earn, etc)
  •  Complained about comments relating to his/her: gender, age, religion, disability, place of birth, race, etc.
  •  Requesting a change to company policy because of a medical issue (including anxiety/depression) or religious beliefs.

Note this is not a comprehensive list. Check out the Employer’s Termination Checklist for more information.

Consideration of Severance Agreements

A severance agreement is a useful tool businesses can use to limit liability when terminating an employee. The terms of the agreement typically state that the business will agree to pay the terminated employee money in exchange for releasing the business from liability and waiving the employee’s right to sue the company. This can also serve to help the terminated employee financially, as he/she searches for a new job.

When terminating an employee, should the company offer a severance agreement? If so, how much money should be offered? Each situation should be evaluated on a case-by-case basis, and there is no "one size fits all" for all circumstances. However, here are a few points to keep in mind when determining whether to offer a severance agreement and the amount to offer.

  •  Whether the employee is litigious
  •  Whether there is a concern of a potential lawsuit by the employee
  •  The length of time the employee worked for the company
  •  Confidentiality
  •  The amount it will take for the employee to sign the agreement

An employment attorney can help your business determine the answers to the above points, and help navigate through the termination process.

Visit for more information  and to schedule an introductory call to discuss legal protections for your Florida business. Here is how we can help:

  1. Legal Risk Audit

Schedule a legal audit for a comprehensive review of the  company's employment policies and practices to make sure they are legal and discover best practices to protect the company from risk and liability. Online Scheduling and Quick Availability.

2. Legal Advice & HR Consulting

The Wannos Law Firm, PA provides employment law and HR consulting and legal advice to clients in Florida. We help clients navigate those tricky employee issues to make sure they comply with the law. Schedule a consultation.

3. Workplace Trainings

Are the managers making decisions regarding employees, but don't know the "do's and don'ts" of the law? We train CEO's, HR Departments, Supervisors and Employees on the employment laws affecting the business. More Information Here.

5. Workplace Investigations

The Wannos Law Firm, PA provides prompt, independent and efficient workplace investigations in response to employee complaints of harassment, discrimination, retaliation and serious policy violations. Schedule a call to discuss how we can help.

6. Employment Mediation & Arbitration. Get your employment matter resolved without the expense of litigation. Karly is a Florida Supreme Court Certified Mediator and has participated in 75+ mediations. Reach out for online scheduling and pricing.

This is not legal advice and does not create an attorney client relationship. Karly Wannos is licensed to practice in Florida only. Therefore, the educational materials apply to Federal and Florida law only. Consult with an attorney in your state prior to making any important decisions.


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