Can my employer fire me despite my success?
Until last week, John was a salesman at a medical-supply firm. His manager fired him saying: “You don’t fit the organization.” He was floored because he was ahead of his sales and profit numbers for the year, and there was more business in the pipeline. He’s confused, hurt and bitter.
He writes: Can they just fire me? In order to get my severance package, I’ve been asked to sign a liability release that says I can’t sue them for any reason, and a non-compete agreement (NCA) that would prevent me from contacting its customers. Should I sign this? Can I sue for wrongful discharge because I exceeded my sales and profit quotas? They didn’t even include
Jim Pawlak a portion of my quarterly bonus in my severance package; aren’t I entitled to it? What can I do?
Let’s take a look at John’s questions. “Can they just fire me?” Yes. Welcome to the world of at-will employment. Most salaried workers are unaware that, unless there is a union or a written employment contract involved, employers are given wide latitude when dismissing salaried employees. Is it fair? No. Is it against the law? No.
Most employers’ HR procedures emphasize that salaried employees are at-will employees. Basic reasons for termination are generally outlined using broad language like: “Employees may be terminated for reasons including, but not limited to … ” Most salaried employees only pay attention to the “not limited to” reasons and forget the “but.”
“In order to get my severance package, I’ve been asked to sign a liability release and an NCA; should I sign these? Can I sue for wrongful discharge because I had exceeded my sales and profit quotas?” You should consult an employment law attorney before signing anything or deciding to pursue a wrongful discharge suit.
Your attorney will ask you to obtain copies of your former employer’s employee handbook (if there is one,) HR procedures related to performance evaluation, termination, bonus/commission payments, your personnel file (Not all states have laws allowing you to obtain a complete copy of your personnel file; your attorney can advise you.) and a copy of the company’s customer list so you know the customers you cannot contact.
Write a letter to the HR department and request copies. Be sure you ask for a timely reply because most companies require that a liability release and NCA be signed within a few weeks of termination.
Obtaining copies of HR procedures, your personnel files or customer list by any other means (i.e. asking a former coworker) may jeopardize your severance package and may open you to a lawsuit.
Relative to the NCA, a company may back off because it doesn’t want to release its customer list. If you do receive a copy, do not to share it with another employer — even one not in the company’s industry.
In at-will situations, the keys to winning a wrongful-discharge suit are proving discrimination based on race, gender, age, disability or religion, etc., or the boss “had it in for you.” The burden of proof is always on the employee; you’ll have to recall and write down all instances where you believe you were unfairly treated and discuss them with your attorney.
“They didn’t even include a portion of my quarterly bonus in my severance package; aren’t I entitled to it?” Generally, bonuses are paid based upon being on the payroll as of a certain date. Bonuses are usually considered fringe benefits that, unlike commissions, aren’t directly tied to individual sales. That said, your state’s law may allow you to receive commissions on orders in the pipeline. Rely on your attorney’s expertise.
“What can I do?” Beyond what your attorney advises, you need to find your next career opportunity. That starts with preparing your résumé/cover letters and, in addition to responding to job postings, network, network, network.
Most salaried workers are unaware that, unless there is a union or a written employment contract involved, employers are given wide latitude when dismissing salaried employees. Is it fair? No. Is it against the law? No.