Types of Termination

There are 5 main categories of termination:

Voluntary Resignation

Resignation refers to a termination decided upon by an employee, who for any reason determines they want to end their employment agreement with a given organization.

End of Temporary Employment

When a fixed term of temporary employment ends, the contracted temp leaves their role unless they are asked to join the organization permanently.

Retirement

Employees retire from employment when they reach an age at which they are ready to elave the workforce permanently.

Job abandonment

Technically considered voluntary resignation, job abandonment occurs when an employee does not show up for scheduled working hours for a number of consecutive days. In most states, 3 consecutive days of unexcused absences is considered job abandonment.

Involuntary termination

Involuntary termination can include layoffs, closure of business, or individual termination as a result of unsatisfactory performance.

Risk Level

Am I at risk of wrongful termination?

Involuntary terminations are an unfortunate aspect of running a business, and can sometimes bring the risk of a wrongful termination claim upon the business owner. You may be at risk if:

  • Your reasons for terminating are prohibited by law, such as a discrimination based termination
  • Your reasons for terminating violated an employee's rights, for example, terminating an employee for reporting a workplace violation
  • You terminated an employee on leave in accordance with the Family and Medical Leave Act.

If you think an employee has made or will make a wrongful termination claim against you or your business, contact us immediately for assistance in avoiding an expensive lawsuit that could result in the loss of your business.

Unemployment Benefits & Continued Coverage

Workers who become unemployed through no personal fault, such as through layoffs or a company decision that does not reflect poor performance, may be eligible for temporary financial assistance in the form of unemployment benefits. Guidelines for eligibility and coverage are determined by state regulations.

Employer responsibility

If a former employee can prove their termination occurred through no fault of their own, they can claim unemployment benefits. These benefits are financed by the federal and state unemployment taxes paid by business owners. Your tax rate is determined by the number of former employees who successfully collect unemployment benefits after termination from your organization, which is why it is in your interest to keep this number as low as possible.

Terminated employees can typically claim unemployment benefits if:

  • They have been laid off
  • A change in the location of your office substantially changes an employee’s commute
  • Workplace safety violations have been noted and not corrected
  • Their duties have changed in a way that interferes with their religious beliefs
  • Their hours or wages have been reduced by 25% or more

Health Care Continuation

In most cases, terminated employees are eligible to opt into continued healthcare coverage after the end of employment for a limited term under the following acts:

The Consolidated Omnibus Budget Reconciliation Act (COBRA) offers employees and their families the option to continue receiving health coverage for a limited time after job loss by paying the full insurance premium up to 102% of the cost to the plan. Upon termination, employee will receive notice from their employer as well as their insurance company with instructions and guidelines around extended coverage.

The Health Insurance Portability and Accountability Act (HIPAA) stipulates protections for coverage of beneficiaries under group health plans. These include limiting exclusions of participants with preexisting conditions and prohibiting health-based discrimination. HIPAA may also grant the right to purchase individual coverage at the termination of a participant’s COBRA coverage.

If you think an employee has made or will make a wrongful unemployment claim after leaving your business, contact us immediately for assistance in avoiding an expensive lawsuit that could result in the loss of your business.

Equal Employment Opportunity (EEO)

Equal employment opportunity laws prohibit workplace discrimination. This includes limited opportunities or other unfair treatment based upon an employee’s:

  • Age
  • Disability
  • Ethnicity, Country of Origin, Color, Race, Religion, Sex
  • Veteran status

Employees who report a violation of EEO may be granted the right to sue the offending organization by the Equal Opportunity Employment Commission.

If you think an employee has made or will make a wrongful discrimination claim after ending employment with your organization, contact us immediately for assistance in avoiding an expensive lawsuit that could result in the loss of your business.

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