I Have to Fire a Long-Time Employee with a History of Positive Performance

Q: I’m in a confusing situation right now at work. I’m a sales manager for a large furniture store. The sales director who hired me recently retired and a new person took her place. He has gone through all our sales associates’ files and determined 3 individuals he believes need to be fired. Two of them have had less than spectacular performance reviews in the past two years. But the third is a long-time employee of around 25 years who has never had a poor performance review in the entirety of her time here. We’ll call her Marilyn.

When I approached my boss with my concerns, he said that Marilyn is too old for her role. While that seems crass, there is a glimmer of validity in his statements. Marilyn hasn’t been able to understand the new technical systems we put in place, therefore, the rest of our staff must accommodate her process into the greater company process. We’ve tried extensive training to no avail. Despite her inability to work around updated technology, she is still productive and a huge asset to our team because of her experience in the industry and knowledge of the customer base. She is more like family than an employee, and it’s tearing me up to have to do this to her.

Would you move forward with firing Marilyn? Or would you push back on your boss if you were in my shoes? I appreciate any guidance you can provide!

A: I’d definitely recommend pushing back on this one. With 25 years of tenure under her belt, Marilyn shouldn’t necessarily be terminated with the rest of the group simply because a new sales director has entered the scene and determined that her sales numbers haven’t been up to par. The new boss may be right—she’s got to go. But how you handle it and the record you have in place will make a huge difference if Marilyn doesn’t see this coming, is frightened about her prospects of finding a new job, or if she ultimately decides to reach out to a plaintiff’s attorney for representation.

Let’s start with the 800-pound gorilla in the room. It’s not correct for the sales director to assume that Marilyn can be terminated at whim simply because she’s employed “at will.” That’s a tremendous land mine that many executives step on, only to find themselves wrapped up in litigation because they “failed to accord workplace due process” to the employee. In other words, the employee was never given written notice about what the problem was, what the expectations going forward were going to be, and what the consequences would look like if she failed to meet certain sales performance thresholds.

Failure to accord workplace due process is a foundational element that plaintiffs’ attorneys establish in order to justify a wrongful termination claim. From there, however, it gets scary: the damage spectrum then increases from compensatory damages (for wrongful termination) to punitive damages (for age discrimination, retaliation, and harassment claims, which will likely come your way as the employer once an attorney gets involved). In short, there’s far too much at risk to terminate this individual without a clean track record of progressive discipline in place.

There are two options before you: First, you can play it safe and by the book by creating a documented warning confirming that Marilyn’s sales results have not been acceptable, establish the new go-forward sales minimums, and point out that failure to demonstrate immediate and sustained improvement will result in further disciplinary action, up to and including termination.

This first option accords the worker “due process,” meaning she now has a written record that her position may be in jeopardy, that her sales performance is not up to par, and that if she fails to increase and sustain her output, she’ll eventually be terminated. This helps insulate the organization from unwanted legal exposure (or at least mitigate potential damages) because the employer now has a documented track record to rely on. The written warnings create a new record of substandard job performance, which stand in stark contrast to the past 25 years’ stellar performance reviews. In essence, the written warnings “break the chain” of positive performance reviews in the employee’s record, indicating the need to increase output to a minimum level in order to remain employed.  

There is a second option, however, which is a bit riskier but that may be worth pursuing, depending on your relationship with Marilyn. For example, if you know that she’s not the litigious type or if you otherwise sense there is little risk in holding a transparent discussion with her about this, then proceed as follows as the sales director (with her immediate supervisor present as a witness), emphasizing that you will respect whatever decision she makes:

“Marilyn, as the new sales director, I’ve been reviewing everyone’s sales numbers going back two years, and with all due respect, you haven’t been coming close to the monthly quota for quite some time. Are you aware of that? [Yes] I respect the fact that you’ve been with the organization for 25 years, but I’m afraid I’m going to have reestablish monthly sales quotas for everyone, and that may be difficult for you for various reasons.

“In a spirit of full transparency, I’d have to issue you a documented written warning at this point confirming that you haven’t hit your numbers at least for the past two years. I’d include what the go-forward quotas will need to look like in addition to the fact that there will be further disciplinary action, up to and including dismissal, for anyone who’s not meeting those numbers.

“Then again, I wanted to meet with you in advance to discuss this with you in case you’d like to consider other options. First, if you’re totally willing to recommit to your role and the new monthly sales expectations, we’d be happy to support you in any way we can. On the other hand, there may be a larger opportunity here for your consideration: would exploring other opportunities outside the company while you’re still employed make sense for you at this point in your career? Or would leaving now on your own terms allow you an honorable exit strategy?

“I’m asking because I want you to have options, especially if you’re not all that excited about having new monthly sales deliverables. If you’d prefer to step down from your role, Marilyn, I’ll also proffer one more idea for you to think about. We could consider putting together what we’d call a ‘separation package’ for you. We would typically model it on the severance formula, which states that an employee is eligible for one week of severance pay for each year of service. As a 25-year employee, you would be eligible for a 25-week severance package, or roughly six months.

“Further, we wouldn’t contest your unemployment claim. If you choose to go that route, we would ask you to sign a release, which is a hold harmless agreement confirming that you waive your right to sue the company for any disagreements or other issues. Further, you’d have the opportunity to communicate your decision to your teammates however you’d like (without telling them about the separation package, though).  

“What’s important for you to remember, though, is that this is all strictly up to you. We’ll accept whatever decision you make. If you were to tell us that you’d rather remain employed and commit to the existing sales quote structure, we’ll all commit to supporting you. If you decide that you’d rather remain employed and look for another job on company time, so to speak, we’ll be okay with that as well as long as you keep us as your priority and always give us at least 24 hours’ notice so that we could arrange for back-up floor support. And if you decide that you’d rather accept a 25-week separation package in exchange for a release, we’d certainly accept that as well.

“There’s no need to come to a decision now. Feel free to think about this, sleep on it, and let me know how you feel about it. And of course, you could speak with me one-on-one at any time to discuss the matter confidentially. In fact, I’d encourage you to discuss it with an attorney to make sure you understand your rights – Again, we want you to handle this however you feel most comfortable and not feel any pressure to rush to make a decision. Maybe you could let me know by Friday, this way you could discuss it with your family and friends and give it ample consideration, okay? [Yes] Thanks for coming into this meeting and discussing this with us today.”

Mission accomplished: You offered a compelling package for a 25-year employee, and by proffering a release in exchange for this separation package, you’ll have done your company and your employee a great service. More important, you’ll have handled the matter professionally, respectfully, and without drama. No, this isn’t the perfect ending, but you’ll have restored respect and dignity into the employment relationship and potentially insulated your organization from broader liability. Allowing employees to walk out of the company on their own terms with their respect and dignity intact is often the best medicine when new management with heightened expectations comes onto the scene.

P.S. Make sure that nothing gets documented or referenced further about Marilyn being “too old for her role,” a “dinosaur in Techno Land,” or anything similar. Such evidence—especially if identified in an email or other written communication—may provide prima facia evidence of age discrimination and expose the organization to punitive damages.

Send questions for publication to gabrielle.reed@harpercollins.com. (Questions may be edited). Join the live chat Mondays at noon. Submit your questions and comments here before or during the discussion.