When Firing Policies Fail

In early February of 2020, the New York Times published an article by Nicholas Kristof, an Op-Ed columnist, about a U.S. Bank customer service representative fired for helping a stranded customer on Christmas Eve. In the article, Kristof goes on to explain how a U.S. Bank customer was stranded without money or gas waiting for money to clear through his account when he got help from a CSR agent. The CSR physically met him to give him $20, out of her account, to get home to his family on Christmas Eve.

When the bank found out that its employee went way above and beyond its vision statement of “Our employees are empowered to do the right thing”, the CSR was fired. Her manager was fired for letting her go to meet the customer during her break. U.S. Bank backed its decision stating the CSR broke the rules by placing herself and the bank at risk. Kristof, as well as several Oregon newspapers, didn’t see it that way.

Since several newspapers have picked up the story, the CEO of U.S. Bank, Andrew Cecere, has apologized to both the CSR and her supervisor, promising, “I will fix this.”

So, how can organizations make sure their termination policies follow best practices and avoid potentially negative publicity?  

Here we offer a few high-level tips on why your organization needs a termination policy and how to propose one. The finer details depend on local and state laws. Be sure to consult with legal counsel before training employees on your termination policy and implementing the process.

Why Every Company Needs a Termination Policy

A termination policy accomplishes two things: it protects the organization from risk and liability and details how to treat employees during involuntary termination because of layoffs or performances issues.

  1. An effective termination policy helps avoid wrongful termination claims and lawsuits. It also helps maintain compliance with federal, state, and local employment laws. With a policy in place, organizations define critical aspects of their business. For instance, what comprises voluntary and involuntary termination.
  2. By having a termination policy in place, organizations are clear and transparent so that transitions are less traumatic. Termination of an employee certainly affects the terminated employee, but it also affects their colleagues and the projects they leave behind.
  3. Termination policies help organizations manage layoffs or reorganizations. It allows your organization to provide timely notification and communication to those teams, facilities, or units affected both overseas and the U.S. It also helps your organization to plan post-layoff action and to end the appropriate contracts.
  4. With a written termination policy, your company can detail the consequences of negative actions and strengthen the positive performance of their employees. Standard practice begins with an employee receiving a warning. If the poor performance or bad behavior persists, written warnings or notices can be filed, with termination being the last resort.

What’s at the Core of Your Termination Policy?

In your introduction, define the types of termination: voluntary and involuntary and include firings as voluntary since the employee has done something within their capacity to get fired. It’s important to train supervisors and managers on the distinction between the two types of termination. While the introduction is important, the core of your policy is where the details lie. Here’s what to include:

  • Who the policy covers.
  • Determine what constitutes voluntary and involuntary terminations.
  • Discuss the reasons why an involuntary termination can occur.
  • State the number of warnings an employee can receive before being terminated and be sure to include that it does not apply to all situations and events. Express that each incident is evaluated on a case-by-case basis.
  • State that employees can receive counsel in certain situations where involuntary termination is warranted, but there is no guarantee.
  • Document warnings in their personnel file.
  • Include information regarding The Worker Adjustment and Retraining Notification Act (WARN).
  • Be sure to investigate each infraction on an individual basis.
  • Ensure your termination policy syncs with your mission and value statements.

While this is by no means a comprehensive list to creating a termination policy, it should get you started. With buy-in from legal counsel and upper management, you can create a policy that protects your organization against liability and mitigates risk.


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