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Employee Life Cycle Part 8: Employee Discipline & Termination

Hear from Paychex HR consultant Margie Bassford as she reveals some best practices for effective employee discipline.


Discover more about the employee life cycle:

Part 1: Paying Employees

Part 2: Proper Employee Documentation

Part 3: Human Rights & Discrimination Laws

Part 4: Paid Time Off

Part 5: Employee Behavior & Performance

Part 6: Workplace Safety

Part 7: Employee Handbook Policy

Part 9: Attracting & Retaining Talent

Part 10: Deepening Employee Engagement


When you hire employees, you hope that their tenure at your business is successful and lasting, but there may be times when you need to address certain employee issues. While it can be intimidating, the way you handle employee discipline can impact everything, from profitability and employee morale to turnover and potential litigation.

If you notice an employee exhibiting either a behavioral issue such as chronic lateness or absenteeism, or performance issues such as missed deadlines or the inability to achieve targeted goals, you may want to consider progressive discipline. This generally involves a series of steps – verbal warning, written warning, final warning and/or suspension, and lastly, if necessary, termination. These are designed to alter an employee's behavior or improve performance through specific feedback or additional training. Employers should take action as soon as they become aware of an issue or when company policies have been violated. Your other employees and maybe even your customers may be at stake.

Progressive discipline can also help you create a paper trail of documentation that can be useful should an employee file a wrongful termination or discrimination claim, or if the company wants to defend against a claim for unemployment benefits.

Ideally, progressive discipline leads to improved behavior or performance. And sometimes it really is just awareness that helps employees make the necessary improvements. Unfortunately, there may be times when an employee's behavior or performance issues do not improve or even worsen to the point where termination is necessary. If this is the case, your supervisors and managers should consider how to mitigate the disruption to the company as well as to the employee.

The manner in which you notify an employee of termination could influence whether or not they sue for wrongful termination. This is why it's imperative that you ensure you have detailed and accurate documentation regarding the reasons for termination, minimize the pain to the exiting employee by making the process transparent and professional, and minimize the disturbance to the workplace by communicating what happened in a professional manner.

You will also need to request the return of company property, prepare the employee's final paycheck and separation letter or notice as required by state law, address the termination of benefits, and provide notification of health insurance continuation if applicable.

Whether employees leave voluntarily or lose their jobs through no fault of their own, the separation process can be difficult. Keep in mind this is a normal and manageable part of the employee life cycle.

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* This content is for educational purposes only, is not intended to provide specific legal advice, and should not be used as a substitute for the legal advice of a qualified attorney or other professional. The information may not reflect the most current legal developments, may be changed without notice and is not guaranteed to be complete, correct, or up-to-date.

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