Sued for Wrongful Termination - What Now?

Under California law, the deck is not as stacked in favor of the employee as many businesses/employers believe. Defense of a wrongful termination lawsuit begins well before a lawsuit is ever even contemplated.

It is presumed in California that the employment relationship is at-will as set forth in the Labor Code. Businesses are well advised to solidify this relationship from the outset. An at-will statement should be included in any employment application and all written performance reviews. If a business utilizes an employee handbook, an at-will statement should be included as a separate policy as well as in the acknowledgment signed by the employee when receiving the handbook. Written contracts, which are recommended, are another document used to establish the at-will employment relationship. It should be clearly stated that the at-will relationship can only be altered in a writing signed by the owner/president/CEO of the company.

Document, document and document some more. It is in the best interest of a business to document an employee's personnel file especially in cases of verbal warnings or discussions about an employee's performance or conduct. It is important that such an approach be applied evenly, and that the same standards apply with all employees. A consistent approach undermines claims of discrimination when everyone is treated the same. Documenting the file will help an employer demonstrate an employee was terminated for performance or conduct reasons, not an improper purpose (race, sex, ethnicity, age, or other protected characteristic).

When conducting an employee's annual performance review ask open ended questions about the employee's work environment, relationship with others (peers and supervisors), and overall feeling about his/her job. This approach can elicit whether harassment or discrimination is occurring in the workplace and allow the employer to remedy the situation. On the other hand, an absence of information that any harassment or discrimination is occurring in the workplace can assist in defending against those types of claims.

In sum, the defense to a wrongful termination claim begins well before the lawsuit is filed. A business is well advised to review its procedures to insure it is not only complying with the laws governing the employer-employee relationship, but that it is operating in a fashion to maximize productivity and protecting itself from meritless lawsuits.

Bob Caietti is a partner in Walters & Caietti, APC, and can be contacted through the firm's Temecula office located at 40140 Winchester Road, Ste. C, 951.693.2024, or