Disciplining and Terminating Employees How to handle problem employees appropriately

by Joan M. Roediger, JD, LLM Obermayer Rebmann Maxwell & Hippel, LLP

In every medical practice, challenges in personnel management require a significant amount of the practice’s administrative time. Practices repeatedly are confronted with problem employees and must address how to appropriately discipline them. By starting with routine evaluations, problem behavior should be able to be identified and corrected early. When necessary, discipline may be implemented, up to and including termination of employment. Implementing uniform practices when managing employees likely will improve the efficiency of your practice, while reducing your legal exposure.

Routine Evaluations
An important part of the discipline process is not discipline at all—it is the routine evaluations you should be performing on your employees. At minimum, you should perform evaluations on all new employees before the end of their probationary period of employment. Additionally, you should have annual evaluations for all employees. The evaluations are the key to promotions, demotions, raises, and firing of employees.

The routine evaluation should assess the employee’s understanding of the requirements of his position, the quality of the employee’s work, and the employee’s interactions with patients and other staff members. The employee’s reliability also should be assessed, including his attendance record, punctuality, and dependability. All employees should be evaluated with a standard evaluation form that is suitable to their position in the practice. One goal of employee evaluations is to identify any problem areas, and communicate to the employee what is expected of him and what corrective actions he should take to improve his performance. Your practice should keep accurate and contemporaneous records of the employee’s evaluations to defend or support the practice’s actions in an employment-related matter.

Disciplining Employees
At times, it may be necessary to discipline your employees. The infringement may be something simple, such as the employee routinely showing up to work late, or it may be a serious infraction. Before you discipline an employee, carefully consider all options.

When discussing an employee’s performance with him (good or bad), it should be done in private. Too often, an employee is disciplined in front of patients and staff. This can embarrass the employee and may increase the likelihood that he will file legal action against you or the practice.

To avoid this, make sure you have conducted an investigation of the allegation of the employee’s performance before you formally discipline him. Verify the facts that have been presented. When conducting the discipline, think about the four W’s: when, where, who, and what. Consider when this discussion should occur, where it should occur, who should be there, and what should be said. Regardless of when the meeting is conducted, it should be conducted in a private room. It is a good idea to have a witness to the discussion, perhaps your practice manager or other high-level employee.

Plan what you will say. Your conversation should be based on your investigation and verified facts. After meeting with the employee, make sure a prompt record of the meeting is created and kept. This should include documentation of what was discussed at the meeting, as well as the employee’s reactions. For instance, if the employee admits to having committed the particular infraction, you want to make sure this is documented. You, as well as the witness to the meeting, should sign this documentation. A copy of this should be placed in the employee’s personnel file.

An important part of any discipline process is specifying what corrective steps are necessary. Of course, in some instances, corrective steps are not possible. For example, if the issue surrounding the discipline is the employee’s bringing a weapon onto practice premises, then immediate termination is warranted and no discipline is appropriate. However, the majority of employee infractions may be appropriate for disciplinary action and a plan of correction.

Before undertaking the disciplinary action, refer to your employee manual. It may contain a provision regarding mandatory progressive discipline. Make sure you consistently apply discipline to all employees. In particular, you do not want to be in a situation where you have disciplined one employee for reporting to work late every day for three weeks in a row, and another employee has been late to work a similar amount of times or greater, but has not received any discipline.

Firing Employees
In cases when discipline is not appropriate or where disciplinary action has failed, your only resort may be to terminate the employee’s employment. Before firing an employee, first ask yourself, “Why is the person being fired?” and conduct a thorough evaluation of your legal risks of the firing. It is a good idea to consult with your practice attorney regarding your practice’s legal exposure. Even though many states (including Texas) are “employment at will” (states that permit employers to fire an employee with or without cause at any time with no notice), claims of discrimination and other employment-related matters may arise.

The question of when to fire always is difficult to answer. If possible, it should be done before or after office hours. You do not want to fire an employee when patients are present in the office because you can’t be sure how the employee will react.

Before you fire an employee, review your practice security. Consider the employee’s access to the practice’s sensitive information. For instance, does this employee have remote computer access or access to the office after hours, either by key or by security code? It is wise to have all the steps in place before terminating the employee. This may include notifying your landlord or the building security person to deactivate the employee’s security code. It also should include deactivating the employee’s computer access. Above all, secure all practice information to protect your practice. Have a checklist that includes all the preventive steps you should take as part of the firing process.

When communicating the decision to the employee, meet with him in private. Again, consider having a witness present. Document your decision to fire the employee and his reaction to the firing. Place a copy of this documentation in the employee’s personnel file. When communicating the decision to your remaining employees, do not disparage the former employee in any way. This will minimize your chance of later being sued for defamation or slander.

Before terminating the employee, determine whether you will offer severance and/or the length of notice you will give the employee regarding the termination. It generally is not a good idea to have employees around the practice after they have been fired. It can affect the morale of your remaining employees. When determining whether to offer severance, if it is not required under your employee manual and is an additional benefit to the employee, you may want to consider whether to have a separation agreement regarding the termination. A separation agreement is beneficial where you think the termination will be contentious or your practice has potential exposure to claims by the former employee.

Your practice attorney, who is experienced in drafting employment termination agreements and releases, must draft the separation agreement. Don’t rely on a preprinted form or template documents. The separation agreement must contain specific legal language regarding the release and waiver of claims. Depending on the employee’s age, additional language is required. No matter the reason for terminating the employee, make sure you follow the law with regard to COBRA notification to the employee of his post-termination benefits. Also, make sure to return all his personal belongings and make sure the employee returns all practice property. Timely remove the employee from all practice health insurance plans, unless the employee has elected continuation of health insurance through COBRA or has negotiated continued health insurance as part of his separation agreement. When necessary, notify individuals outside your practice who had regular dealings with the employee about the change in your staff.

Finally, after the employee has been terminated, you likely will be in the uncomfortable position of being asked to provide a reference on behalf of the employee. Carefully consider what, if anything, you will say regarding the employee’s performance. The most prudent course of action is simply to confirm the dates of employment. It is permissible to state that you wish the employee all the best in his future endeavors. The less said, the better, to protect yourself and your practice from potential claims by a former employee of defamation or slander.

While no strategy is foolproof, implementing good employment practices will minimize your legal exposure within your medical practice. Of great importance in personnel management is planning of employee evaluations, disciplinary actions, and firing employees. The time you spend planning these actions will greatly benefit your practice.

DISCLAIMER: The preceding article was intended to be merely educational and should not be perceived as a substitute for legal advice. Please consult your own attorney regarding your particular circumstances and concerns.

Joan M. Roediger, JD, LLM, is a partner with the law firm Obermayer Rebmann Maxwell & Hippel LLP and is a member of Obermayer’s Health Law Department.

Reprinted with permission from Physician’s News Digest www.physiciansnews.com