Chapter 9 Terminating Healthcare Employees

The United States is:

a litigious society. In addition to establishing alternative dispute resolution methods, organizations (including healthcare organizations) are purchasing insurance to protect themselves from numerous lawsuits by employees for sexual harassment, wrongful termination, failure to promote the employee, and other employee issues.

due process methods

that enable employees to appeal the organization's decision to terminate the employee. Due process also includes the fairness of the employer process of determining employee actions that result in disciplinary actions. Establishing these types of policies may avoid a legal dispute between the employee and the employer.

Arbitration

uses a third-party system to make a decision regarding the employment dispute. The decision of the arbitrator is a binding decision that both parties must abide by and is enforceable under federal and state laws.

for cause

when they make a serious judgment error. Examples are stealing or threatening another employee. This may be the easiest way to terminate an employee because the action is an open violation of the company code of conduct. Employees can be terminated because of poor work performance. This reason is typically documented, as the employee with poor performance will have received documentation on how to improve. The employee is terminated if the performance does not improve.

positive discipline approach

which assumes that employees can change their behavior if given constructive criticism. The approach consists of problem-solving conferences between the employee and the supervisor.

alternative dispute resolution methods

which consist of open-door policy, peer-review panels, mediation, and arbitration (Types of ADR Techniques, 2018).

Healthcare Payer Provider Arbitration Rules

which focuses on reimbursement disputes between providers and payers in the healthcare industry (AAA Healthcare Payor Provider Arbitration Rules, 2018).

progressive discipline approach

which is a formal discipline process in which repeated negative behavior results in more serious disciplinary measures.

American Arbitration Association (AAA)

which is the largest alternative dispute resolution provider, trains individuals in resolving employment issues through arbitration and mediation. Established in 1926, this nonprofit public organization has been responsible for dispute resolutions in many different industries, including health care. In 2001, AAA launched the Healthcare Payer Provider Arbitration Rules.

wrongful termination

If an employer fires an employee for refusing to violate a public policy, this action would be construed as wrongful termination.

Employee Separation

In a recent survey of healthcare managers, healthcare employee terminations occurred for the following six reasons: (1) poor performance, (2) ethical misconduct, (3) inconsistent attendance, (4) poor attitude, (5) personality conflicts, and (6) substance abuse. The primary reason termination occurred was poor performance by employees. Theoretically, routine feedback and discipline can change employee performance; however, unfortunately, sometimes an employee cannot change his or her performance.

involuntary termination/firing

It is a difficult process to initiate and rarely a happy occasion for either the employer or the employee. It is extremely important that there is a written process in place to document this decision because of potential lawsuits that may be initiated by the unhappy employee.

Establishing a progressive discipline approach depends on the organization's diligence in written policies and procedures for employee performance and expectations. For this approach to be successful, the manager must avoid three mistakes:

(1) Think of the disciplinary process as an education for the employee, not a punishment. If a manager thinks it is a punishment, it can create an adversarial environment that could create problems. (2) Managers take disciplinary action too late, which results in an employee thinking the behavior is acceptable and the ultimate disciplinary action appears to be too harsh for the employee. By waiting on disciplinary action, the manager may also build resentment toward the employees. (3) The manager is so stressed that they just blow up at the employee, telling the employee to "just knock it off." Such a reaction is counterproductive to this progressive type of approach

The 4 steps of the positive discipline approach include:

(1)Counseling: Inform the employee of organizational rules. This is a face-to-face conference between the supervisor and the employee. (2)Written documentation: The employee fails to correct behavior after the initial step, so there is another face-to-face conference to review the issue to ensure that the employee understands. The employee is informed that the conference result is written up and is placed in the employee's personnel file. The employee is asked to sign the summary statement. (3)Decision-making leave: If the employee does not change their behavior, they are asked to remain at home to decide if they can adhere to the organization's policy. The manager meets with the employee the next day. The employee may be asked to develop an action plan to remedy inappropriate behavior. The action plan is placed in the employee's personnel file. (4)Termination: If the action plan is not followed, then the employee will be terminated

A Checklist for Terminating Employees:

(1)Employee education on employment law and company policies: Both supervisors and their employees should receive training regarding their rights in an organization. The training will help both parties understand their obligations to the organization and the organization's legal obligation to them. (2)Communication: Communicate both verbally and in writing the expectations the organization has of the employee's performance. Communication begins during the hiring process with the job description. Routine communication continues throughout the employment, documenting any issues with the employee's performance and communicating these issues to the employee. Be sure to routinely review the employee's performance. The communications must be maintained in the employee's personnel file. When the employee is terminated, a termination letter should be given to the employee detailing the reasons why the employee is terminated. (3)Consistency: Enforcement of labor laws should be equally applied to all employees to ensure there are no issues with discrimination of protected classes. (4)Routine performance appraisals: Establish routine performance appraisals for all employees. These appraisals should be standard and should be applied to all employees. (5)Employee feedback: During any performance appraisal process, allow an opportunity for the employee to review the evaluation, make comments, and initial documentation that they acknowledge and understand the evaluation. (6)Termination deadline: Because employee termination can be a very difficult situation, employers may continue to allow a poor performer to continue in an organization. Establishing a time frame for employee dismissal supports the legal defensibility of the termination process. (7)Exit interview: Managers should have an exit interview with the terminated employee in a comfortable environment. Treat the employee with respect. Do not e-mail the termination letter before the interview. Discuss the specific reasons why the employee is terminated, giving them a termination letter detailing the reasons. If possible, provide some placement counseling for the terminated employee, discussing his or her future elsewhere. Have their final paycheck ready, if possible. If there is a potential for litigation, have another individual present who could be a witness to the interview process. (8)Confidentiality: Do not discuss the termination exit interview with other employees. This will prevent any possibilities of defamation lawsuits by the terminated employee. (9)Notify network administrator: Supply the date and time of the termination date, so the employer's access to the system can be completed. Also, the employee must relinquish their electronic equipment if purchased by the company. The employee must submit their passwords to the company as well. (10)Disable access to the building: Ask the employee to submit their keys or swipe cards on the termination date. (11)Provide benefits letter: Explain to the employee how to maintain health insurance and other benefits and if there is any unpaid vacation or sick leave. Some employees may be eligible for unemployment compensation.

The following are typical steps in a progressive discipline approach:

-Oral warning: often unofficial between supervisor and employee. -Official written warning: goes in the personnel file. -Second written warning: could also include temporary suspension threat. -Temporary suspension plus notice of possible termination. -Termination.

All policies impacting employees should be included in the handbook:

-Vacation policies -How to track employee hours and meal breaks -Social media use policy -Employee grievance procedures -Sick leave and vacation policy -Employee benefits -Important contact information for any employee issue -Code of ethics and/or conduct

CHAPTER VOCABULARY

Administrative termination Alternative dispute resolution methods American Arbitration Association Arbitration Breach of implied covenant of good faith and fair dealing Due process methods Employee discharge Employee dismissal Employee handbook Employee separation Employment-at-will doctrine Employment practices liability insurance Exit interview For cause Healthcare Payer Provider Arbitration Rules Implied contracts Involuntary termination Mediation Open-door policy Peer-review panels Positive discipline approach Progressive discipline approach Public-policy exception Wrongful discharge

Employment at Will

All states, except Montana, recognize the employment-at-will doctrine, which means that in the absence of a legal employment contract, employees and employers can end their relationship for any reason. Employees can also change the terms of employment, such as pay rates or paid time off with no notice. Employment-at-will policies are more prevalent in private organizations than in public organizations. Local and federal laws protect public employees, and depending on the state, a written notice of disciplinary action or a hearing for termination for cause is provided (The At-Will Presumption and Exceptions to the Rule, 2018).

Resignation/Quitting

An involuntary resignation is when the employer directs the employee to resign. The employee may feel they are being pushed out by their employer. An employee may be forced to resign by an employer or be fired. If the employer's actions are determined illegal, the employee may be able to file a grievance for unlawful dismissal.

Dismissal/Termination

Dismissal is termination of an employee because of their poor performance. It must be justified and documented and made clear to the employee why they have been terminated. Before a dismissal occurs, organizations typically implement a program to try to correct the employee's performance (Chand, 2018).

Types of Employee Separations:

Employee separation occurs in four different ways: an employee resigns, retires, is laid off, or is terminated. 1.) Resignation/Quitting 2.) Layoffs/Downsizing 3.) Dismissal/Termination 4.) Documenting Employee's Behavior

Layoffs/Downsizing

Employees have been separated from the employer for reasons beyond the control of the employer, for example, the economy, mergers and acquisitions, or bankruptcy. The layoffs may be temporary; in this type of separation, the employee may be rehired.

Introduction

Employment is a relationship between an employee and an employer with expectations by each that the responsibilities of the other will be fulfilled. Both employers and employees have rights and should treat each other respectfully. Employers must provide a safe working environment for their employees. Employees must perform to the best of their ability in accordance with their job descriptions, which is why they were hired. However, satisfactory employee performance does not always happen, which is why there are rules and regulations in place to ensure that both sides maintain their rights when an employee is terminated. The author decided to focus one chapter of this text solely on employee termination because it is often the most difficult action taken by a manager and the organization. Although this is the shortest chapter in the text, it may be the most important. If an organization has a legally defensible hiring process that provides an opportunity to hire the best employees for the organization, there should be a minimal need to terminate many employees. If an employee is terminated for poor performance, it is possible that the person should not have been hired. The organization must emphasize to their employees that the hiring process must be a quality process that will select the best employees for an organization. This chapter will focus on the different types of employee separation actions, employees' legal and contractual rights in the termination process, the impact of the employment-at-will doctrine on the termination of employees, the employee discipline approaches, and the importance of a systematic termination process.

Exit interview

Managers should have an exit interview with the terminated employee in a comfortable environment. Treat the employee with respect. Do not e-mail the termination letter before the interview. Discuss the specific reasons why the employee is terminated, giving them a termination letter detailing the reasons. If possible, provide some placement counseling for the terminated employee, discussing his or her future elsewhere. Have their final paycheck ready, if possible. If there is a potential for litigation, have another individual present who could be a witness to the interview process.

Did You Know That?

Most states adhere to the employment-at-will doctrine, which means that in the absence of a legal employment contract, employees and employers can end their relationship for any reason. Terminating an employee is one of the most difficult responsibilities of supervisors in an organization. Employee handbooks have been upheld in court as being employment contracts. Employment practices liability insurance (EPLI) covers legal fees and settlement fees for organizations.

Chapter Conclusion

Terminating an employee is one of the most difficult responsibilities for a manager because it affects the individual's livelihood. If you must terminate an employee, it may indicate that the organization's hiring process is not adequate. The employee was hired with the assumption that they will succeed. So, prior to the employee's separation, utilizing the different disciplinary approaches discussed in this chapter may change the employee's behavior. As a manager, you want to provide the opportunity for the employee to succeed. If these approaches are not successful, then the employee's separation process is appropriate. In some organizations, the termination is completed by the human resources (HR) department. In other organizations, this task falls on the manager. Termination policies vary. There are some companies that have a face-to-face conference when terminating the employee. There are other organizations that terminate the employee by telephone or e-mail. Managers need to be trained for this uncomfortable duty. The HR department can be very helpful with providing tips on the most appropriate way to separate the employee from the organization. Many guidelines should be followed to ensure that the termination process is legally defensible while providing interactional justice to the employee who is being terminated.

open-door policy

The "in-house" method of resolving employment issues, is the easiest form of alternative dispute resolution. Supervisors indicate that if there are any employment issues, their door is open to any employee to discuss any potential problems from the employee's perspective. An employer should have a forum for disgruntled employees. An open-door policy is the easiest method of providing an avenue for discussion. The disadvantage of an open-door policy is that there is only one person, a supervisor, who is listening to an employee's issue. The employee's issue may be related to another supervisor who is friendly with the employee's supervisor who is listening to the employee's complaints. However, rather than having no due process in place, an open-door policy can be beneficial to both the employee and the employer. A second in-house method is peer review panels.

employee handbook

This handbook is a guide for the employee with respect to the organization's expectations of the employee's behavior. It also is a guide to the policies and procedures of the organization. During orientation, the employer reviews the handbook with the employee. When a new employee is given a copy of the handbook, the organization should also ask that the employee sign a receipt, indicating that he or she has received the handbook and that the receipt is filed in the employee's personnel folder. All employees should have a copy of the handbook. Supervisors should be very familiar with its content. If there are any changes to the handbook during the tenure of an employee, all updated handbook information must be given to the employee with an additional signed statement by the employee that the updates were provided. This procedure eliminates any claims that an employee was not familiar with the policies and procedures of the handbook. To avoid the impression that a handbook is an employee contract, the handbook is written objectively, providing facts about organizational procedures. There should be no guarantees or promises regarding employment. Even if organizations include a disclaimer that the handbook is not an employment contract, some courts have ruled that a handbook could be construed as an employment contract. There should be a disclaimer in the handbook that it is not an employment contract.

Documenting Employee's Behavior

Whether an employee demonstrates good behavior or poor behavior, there should be documentation in the employee's file regarding their actions. An employee should be rewarded for desired behavior, but also discipline should be imposed if the employee's behavior is undesirable. Recognizing each type of behavior establishes a culture of accountability for the employee. Recognizing quality behavior encourages employees to continue that behavior. The organization must impose discipline; if it does not, the lack of discipline may encourage other employees to exhibit similar negative behavior. If an organization allows negative behavior, it is supporting that behavior. The passage of labor laws and the institution of unions have focused on establishing and enforcing employee rights in all aspects of their employment.

Implied contracts

are recognized in 41 states and are created under different circumstances. For example, when a potential employer makes a verbal promise, such as "if you do an excellent job, you will have a job for life" to an employee, courts typically ignore language that promises a lifelong commitment to an employee. An employee handbook or manual may also suggest a type of contract. If an employee handbook has a list of offenses that constitute termination for just cause, a court may assume that these offenses are the only reason an employee can be terminated, which invalidates employment at will. Therefore, it is important that the employee handbook have a disclaimer indicating that it is not an implied contract for employees (Doyle, 2018b)

Peer review panels

consist of specially trained employees who become involved in evaluating employees' disputes. They are required to sign confidentiality agreements regarding the process. They review the dispute and make recommendations to resolve the dispute, which both sides agree to follow.

Employment practices liability insurance (EPLI)

covers employer's legal fees, settlements, and judgments due to employment matters. These insurance products became popular in the 1990s when the Civil Rights Act of 1991 was passed, which allowed financial damages for discrimination and harassment suits. There are currently 60 carriers for EPLI that cover all industries, including the healthcare industry (What Is EPLI? 2018).

breach of implied covenant of good faith and fair dealing

has been adopted into the Uniform Commercial Code and the American Law Institute's Restatement of Contracts. It is the basic assumption of contractual relations that both parties will act fairly and in good faith. Suppose an employer fires a long-term employee without cause, claiming employment at will. However, the long-term employee worked for the company under the assumption that if he performed to the best of his ability, he would be allowed to work for the company until his retirement. The employer action could be a breach of good faith by the employer: 43 states acknowledge the public-policy exception, 37 states acknowledge implied contract, and only 11 states acknowledge breach of implied covenant of good faith and fair dealing (Employment at will states, 2018).

There are 3 major exceptions to employment-at-will policies:

implied contracts, the public-policy exception, and breach of implied covenant of good faith and fair dealing.

Mediation

is also a third-party system but with less rigidity. The mediator intercedes to resolve a dispute, but the mediator's suggested agreement is not legally binding.

voluntary resignation or quitting

is termination of an employee's service to an employer.

public-policy exception

is the most common exception to an at-will employment. An employer cannot terminate an employee if the employee refuses to comply with an employer's request to perform an illegal action that would violate a public policy, such as refusing to cover up Occupational Safety and Health Administration violations.

involuntary resignation

is when the employer directs the employee to resign.

Two external procedures for resolving employment disputes are:

mediation and arbitration. both mediation and arbitration use an external third party to hear the complaint.

administrative termination

which means it is a termination of employment without cause, such as a layoff of employees. Layoffs occur because there has been a downturn in the performance of the company or in the economy that results in less need for labor or because technology has eliminated positions, also resulting in less need for labor. This type of termination is typically not the fault of the employee; therefore, it is more difficult for the employee to accept. This type of termination does allow the company to rehire the employee, if needed, at a future date. The employee can collect unemployment benefits

employment-at-will doctrine

which means that in the absence of a legal employment contract, employees and employers can end their relationship for any reason