Wrongful Discharge Claims Skyrocket; What Makes a Termination Wrongful? - Free Enterprise
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Wrongful Discharge Claims Skyrocket; What Makes a Termination Wrongful?

With firings up, so are claims of wrongful termination. The Equal Employment Opportunity Commission (EEOC) reports being swamped by claims of workplace discrimination. More than ever, small businesses need to understand what constitutes wrongful termination.

According to Inc.com, the EEOC received a record breaking 95,402 workplace discrimination claims in fiscal year 2008. This is 15% more than 2007, and the highest number since the EEOC began in 1965. With more layoffs so far in 2009 and more predicted to come, now more than ever it is vital that small businesses take care when firing employees.

So, what makes a termination wrongful?

Wrongful termination is any firing for reasons which the law forbids. These can include:

  • firings in violation of federal or state anti-discrimination laws;
  • firings as a form of sexual harassment;
  • firings in violation of employment contracts or collective bargaining agreements;
  • firings in violation of labor laws (including collective bargaining laws); and
  • firings in retaliation for the employee having filed a complaint against the employer.

Of course, it goes without saying that employers should never fire an employee based on one of the above reasons. However, even in situations where the employer foresees no impression that the firing was wrongful, a properly crafted severance agreement can include a release of claims protecting the employer from some claims of wrongful discharge.