Why is it important for managers to formally document the reasons for

QUESTION

Why is it important for managers to formally document the reasons for terminating an employee?

What will be an ideal response?

ANSWER

Answer: Although most companies operate under the legal precedent of at-will employment, U.S. society has become more litigious and people who lose their jobs may sue for wrongful termination. Keeping detailed documentation that can prove an employee was fired for cause protects the company in the event of such lawsuits.
Explanation: In all states except Montana, employers operate under the legal doctrine of employment at will, which allows companies to terminate an employee for any reason or no reason. The changing legal climate, however, has led to more lawsuits against companies for wrongful termination. Clear documentation that builds the rationale for an employee’s dismissal protects the company in such legal actions.