Start Your FREE Membership NOW
 Discover Proven Ways to Be a Better Medical Office Manager
 Get Our Daily eNewsletter, MOMAlert, and MUCH MORE
 Absolutely NO Risk or Obligation on Your Part -- It's FREE!

Upgrade to Premium Membership NOW for Just $90!
Get 3 Months of Full Premium Membership Access
Includes Our Monthly Newsletter, Office Toolbox, Policy Center, and Archives
Plus, You Get FREE Webinars, and MUCH MORE!

Terminating entry-level employees may cost you the most

By Steve M. Cohen  bio

I recently spoke with two different clients who were planning to terminate entry-level, relatively “inexpensive” people. I asked them what they meant, and each client indicated that the employee’s annual salary was around $40,000. When I asked if they wanted my help structuring the exit of these two, they both considered that my services were reserved for executive level personnel.

Both employers felt confident and competent to terminate these individuals on their own. I asked each to explain the situation or circumstances surrounding each of the individuals and to share the basis for the decision to terminate. In both instances, the employees were female, one older than 40 and the other younger than 40. One was African-American, and the other was Caucasian. One had been with her employer for two years and the other for five. Both were mediocre employees who had not done anything egregious; they were just underperformers.

In my opinion, each of these companies was steering into hostile waters. Anytime there is a termination, there is potential for a wrongful termination allegation. Individuals very rarely see their situation quite the same as management. With a bias that often exists in state and federal agencies against employers and for employees, any termination should be handled carefully. If the termination can be avoided, then it should be.

In almost all cases, the better alternative to a termination is a structured exit. This results in a voluntary resignation and a signed hold-harmless waiver that, through use of an incentive, has led to a reasonable severance settlement. In fact, there are plenty of things, both monetary and nonmonetary, that can be negotiated and serve as an incentive to achieve the same end.

Any employee termination can be expensive. I once had a case involving a 45-year-old minority female who was paid $33,000 a year. She was hired and assigned to a Caucasian training/orientation person. After four weeks of orientation, the training/orientation person notified the business owner that the new person was “too stupid to hold this job.” The trainer went on to clarify that the new person was asking the same questions over and over—she just wasn’t “getting it.”

The owner of the business advised the trainer to keep trying because the cost of recruiting another person would be considerable. Another 30 days went by, and then the new person went to the owner and advised him that her trainer wasn’t helping, and most of the other employees weren’t even talking to her, either. She believed they didn’t like her because of her race. Now, the owner had a race-based discrimination case on his hands.

This kind of mess can easily cost the employer from $50,000 to $150,000. Not only is it difficult to determine the reality of the situation, it’s next to impossible to determine what a jury, judge or governmental agency may decide. This employee in training was articulate and confident, and most likely would have been a sympathetic plaintiff to the state human rights commission, the Equal Employment Opportunity Commission or in a civil court. Any termination carries significant risks, so consider your options carefully before making a choice.

Steve M. Cohen, Ed.D., CMC is President/Partner of Labor Management Advisory Group, Inc. and HR Solutions: On-Call, both based in Kansas City, MO. For more information, visit or call (913) 927-0229.

The above information is shared by a guest contributor and does not necessarily reflect the views of Medical Office Manager.









Try Premium Membership