Employees who are serving a probationary period before obtaining “regular” status may be released from their probationary period at any time, with or without cause, and have no right to appeal. Similarly, “At-will” employees may be dismissed with or without cause and cannot appeal. However, these employees may not be released for an illegal reason. ERMA members need to understand that even though these employees have no appeal rights, they could still file a lawsuit alleging that the release was discriminatory, retaliatory, or illegal in some other manner. This article discusses the steps that members should take when deciding whether to release Probationary and At-will employees in order to avoid a lawsuit based on the release.
Step 1 – Determine Whether the Employee Truly is At-will or Probationary
Public agencies hire employees through a civil service system, under which an employee is either a “Regular” employee or an “At-will” employee (among other categories). At-will employees do not hold “Regular” status and serve at the pleasure of the City Manager or other appointing authority and can be terminated at any time without cause. “Regular” employees are those who have completed their probationary period successfully and thus acquire a property interest in their position, which means that before they can be disciplined (including termination), the Agency must provide pre-disciplinary due process (a Notice of Intent to Discipline and a Skelly conference) and a post-disciplinary appeal.
Before releasing an At-will employee, the Agency should confirm that the employee’s status is, in fact, At-will. That status should be documented, either in the Personnel Rules or a Resolution designating the position held by the employee as At-will. The At-will status should also be mentioned in any offer letters to the employee and in Personnel Action Forms or other documents in the employee’s personnel file. Finally, At-will employees do not serve a probationary period; they remain At-will for the duration of their employment. Therefore, if an employee’s offer letter or other documents regarding the employee (such as a performance evaluation) state that the employee will serve a probationary period, the employee may not actually be At-will.
Before releasing a Probationary employee, the Agency should ensure that the probationary period has not already expired. Once the probationary period expires, the Probationary employee becomes a Regular employee whose employment cannot be terminated without “just cause” and pre- and post-disciplinary due process. If an Agency’s rules (or an applicable Memorandum of Understanding) allow for a probationary period to be extended, it can be, but that must occur before the original probationary period expires. Any extensions of a probationary period should be in writing, ideally signed by the employee, so that no dispute will arise later about the date that the period was extended (and the new expiration date).
Step 2 – Determine Potential Legal Risks Arising from the Decision to Release
An Agency may release an At-will or Probationary employee for any reason or no reason, but not for an illegal reason. Though the employee has no right to an administrative appeal of the release, he or she can still file a civil lawsuit asserting that the release was made for an illegal reason. Specifically, the employee may claim that the release was based on his or her membership in a protected status, or having engaged in various types of protected activity, such as making a complaint of harassment or discrimination, participating in someone else’s complaint, or filing a claim for workers’ compensation. An employee could also claim that the release was made because they requested reasonable accommodation of a disability or took protected leave under the Family Medical Leave Act or the California Family Rights Act (including pregnancy disability leave and baby bonding leave). Finally, the employee could claim that the release was retaliation for whistleblowing.
The legal defense to all of these potential claims is that the decision to release was based on legitimate business reasons-such as poor performance or employee misconduct–and not on the purported illegal reason. The Agency should determine how it would prove the poor performance/misconduct in the event of a lawsuit asserting that the release was based on an illegal motive. To do that, upper level management, along with Human Resources personnel, should obtain specific and detailed information about the performance, including obtaining all relevant documentation showing the performance. A brief conversation with the first-level supervisor will not suffice. The Agency should ask for all supervisor notes, performance evaluations, records of communication with the employee about the performance, and any other documentation showing that the employee was told about the performance issues and was provided any required resources to improve.
Human Resources and Agency management should evaluate the documentation and determine how effectively it demonstrates the existence of poor performance or misconduct. If little documentation exists regarding the employee’s performance, and the employee files a lawsuit asserting an illegal reason for the release, a lack of detailed, well-written contemporaneous documentation will undermine the Agency’s ability to prove the legitimate reason for the release. This step of the Agency’s analysis could reveal that the supervisor needs to be more attentive and/or more effective at documenting events. Some Agencies take the approach that because the probationary period is the employee’s chance to “sink or swim,” and because the employee has no right to appeal, there is no need to document performance through evaluations or other methods. That approach leads to a diminished ability to defeat a lawsuit that asserts the release was based on an illegal reason. The more committed ERMA members are to managing (and documenting) performance during probationary periods, the more poised the members will be to make defensible decisions about releasing employees.
Next, the Agency should determine whether the employee has engaged in any protected activity, and if so, ensure that such activity is not the motivation for the release. If the employee has engaged in protected activity or taken protected leaves, the Agency should retain legal counsel to analyze the risks of proceeding with the release. For example, the timing of the protected activity in relation to the decision to release the employee could be problematic. Even if the decision to release is based on well-documented performance issues, if it occurs shortly after protected activity, the employee may argue that it was motivated by the protected activity. Consider a hypothetical case in which an employee is half-way through her 12-month probationary period: Her performance has been consistently poor. Shortly after she files a worker’s compensation claim, the supervisor decides to recommend that she be released from probation. Human Resources and the supervisor’s manager(s) should scrutinize why the supervisor believes a release is appropriate at that time (as opposed to earlier), since the performance has been consistently poor and there remains 6 months in the probationary period.
Step 3 – Decide What to Tell the Employee About the Reason for Release
Many Agencies have a policy that Probationary employees will be told only that the reason for their release is that they “failed to meet the standards of probation.” The advantage of such a statement, as opposed to providing an itemized list of performance failures, is that it eliminates the risk of inadvertently omitting some of the performance failures upon which the decision was based. The reality, however, is that refusing to provide a specific reason for ending someone’s employment can create ill will and lead to suspicion that the real reason was an illegal reason.
In most cases, the better approach is to explain to the employee the specific reasons for the release. This has several advantages. It establishes, in a contemporaneous document, the Agency’s reasons for the release. It removes the mystery and mitigates the potential that the employee will speculate that the release was based on illegal motivations. And it can have the salutary effect of ensuring that an Agency actually has a provable, documented legitimate business reason for the release.
Finally, the Agency must determine whether the reasons for the release require that the employee be provided with a “Name-Clearing” or “Liberty Interest” conference (also known as a Lubey conference). If the release is based on charges that stigmatize the employee’s reputation (for example, theft, dishonesty, or immoral conduct), and there is some type of public disclosure of the charge, the constitutional right to liberty may be implicated. In such cases, the employee would be entitled to a conference with the Agency to clear his or her name before the release occurs. The conference is appropriate only if the employee denies engaging in the stigmatizing conduct; if the employee has admitted it, there is no need to “clear” his or her name.
The bottom line is that members should avoid the trap of not documenting the performance or misconduct of Probationary and At-will employees simply because they cannot file an administrative appeal of their release. Decisions to release these two types of employees can still trigger liability, and members should proceed accordingly.
This article was originally published in the Employment Risk Management Authority (ERMA) Important Legal Alert (October 2018).