In the state of Texas, most employers are able to fire their employees for almost any reason, just as most employees are able to quit at any time, for any reason. This is called the At-Will Employment Doctrine, and it provides a significant level of freedom to both parties in an employment relationship. Just because Texas is a “right-to-work” state, however, doesn’t mean that you can fire an employee without a reason at all—as many people still mistakenly believe. An at-will employee is protected by several types of regulations on both the Federal and State level.
In addition to federal laws that provide some protection from wrongful termination, Texas has a few of its own laws that limit at-will employees’ vulnerability to termination. Federal law states that it is illegal for most employers to fire an employee because of the employee’s race, gender, national origin, disability, religion, age, or because that person is pregnant or has a medical condition related to pregnancy or childbirth. These may seem pretty obvious to most employers, especially if you’ve been doing this for a while. But that’s not all the exceptions that Texas employers should be keeping an eye out for.
Also, just because Texas follows the at-will employment doctrine, whether the employee qualifies for unemployment benefits is a separate issue. While this article will highlight some of the issues to be aware of to avoid claims of wrongful termination, it will not cover how to protect yourself to minimize the risk of your account being charged for unemployment benefits.
Here’s what you need to know about terminating at-will employees in Texas:
Part One: When You Can’t Fire An Employee
There are a surprising amount of exceptions in Texas that are designed to protect at-will employees in a wide variety of scenarios. Some are similar to Federal protections, but others are more specific in nature.
Here are just a few:
- Civic Duty
Employers may not fire at-will employees who have been called for jury duty or end up serving on a jury. Employers also cannot terminate an employee for voting, or for being absent from work in order to vote.
- Union Membership
An employer cannot terminate an employee due to “the individual’s membership or nonmembership in a labor organization.” Whether the employee is in a union or not in a union, that is not a cause for termination under Texas law.
Under the Employee Polygraph Protection Act (EPPA), employers cannot terminate employees for refusing to take a polygraph examination. However, there are a few narrow exceptions for those individuals working in national security related positions.
- Without Required Notice
If the employer is engaging in a mass layoff, they must provide 60 days in advance of termination under the Worker Adjustment and Retraining Notification (WARN) Act.
- Employee Benefits
If you are seeking to terminate the employee for taking advantage of benefits that you, the employer, provide, you will find that it is illegal to do so. Also, you cannot terminate an employee for discussing benefits or salaries with another employee.
- In Retaliation
Whether the employee has filed a workers compensation claim, participated in a whistleblowing action, or filed a complaint relating to workplace safety, you cannot terminate them in retaliation for any of these actions.
These are just a few of the exceptions that Texas employers should be aware of, and certainly not an exhaustive list. For a more complete breakdown, check out my previous blog on the subject, the Texas Workforce Commission, or contact my office for a consultation.
Part Two: How To Legally Protect Yourself When Terminating An Employee
So, you’ve checked and double-checked the exceptions, and you’ve judged that that you can fire that employee. How can you go about doing so without opening yourself to any kind of legal risk?
- Discuss the Issue First
It’s almost always best to discuss performance issues with the employee first, before jumping to termination. While there’s no law that mandates this, this gives the employee a chance to share their side of the story and may nip any accusations of wrongful termination in the bud.
- Keep Records
The most essential part of protecting yourself when you terminate an employee is being able to show documentation that shows the reasons for termination. In an ideal world, you will have several instances of evidence over a period of time to present, should you have to defend your termination in court against a discrimination claim. You will want to ensure that all elements of this documentation are consistent with company policy and with your employee handbook.
- Consider The Employee’s Rights
Before terminating, consider if the employee is a member of any of the previously stated protected classes. While technically, you can fire an employee just for being a nuisance—that’s a great way to get yourself slapped with a discrimination case. Make sure you take into account all protected classes that the employee could be part of and respect their rights accordingly.
- Terminate With Full Wages
When you terminate, the Texas Payday Law requires that you issue the employees final pay within six calendar days. It is illegal to withhold pay after termination in the state of Texas.
As a business owner, it’s important to take steps to protect yourself from any accusations of wrongful termination. Without the right supporting documentation, you could face serious consequences down the line, in the form of a complaint filed with the Texas Commission on Human Rights or the federal Equal Employment Opportunity Commission, or even a lawsuit. By preparing an employee policy beforehand that accounts for as many scenarios as possible, documenting all evidence for termination, and ensuring that you are not in violation of any exceptions to the At-Will Employment Doctrine, you will protect your business from time-consuming and expensive legal action.