Understanding Termination of Employment

What Is Employment Termination?

Ending an employee's employment with a company is referred to as termination. An employee might be fired from their job voluntarily or due to an employer's decision. Employers may terminate employees for various reasons, including laying off workers, poor job performance, and redundancies. An employee who does not actively work due to illness, absence from work or furlough is still considered employed, whereas if the relationship with the employer hasn't been formally terminated with a termination notice.

• Ending an employee's employment with a company is referred to as termination.

• Voluntary termination occurs whenever a worker leaves on their own accord.

• Involuntary termination occurs when an organization decides to reduce, fire or make layoffs.

• Severance packages are optional, meaning employers are not required to provide them to employees once their employer terminates their employment.

• A worker out of work for no fault may be entitled to unemployment benefits.

The Process of Voluntary Termination

• An employee has the right to voluntarily leave a company at any period. Individuals typically resign when they find a better position with some other company, retire from the workforce, resign to open their own business or want to take a break from working. 
• Voluntary termination can also result from wrongful termination, also known as constructive withdrawal or dismissal. This means that the employee had no choice but to leave the company. They may have been working under significant extreme pressure and difficult workplace conditions, which could include, among other things, a small wage, verbal abuse, a new work location that is further than the employee can relatively commute, and increased work hours.
• Constructive dismissal also includes the pressured discharge of an employee, in which they are given an official notice to quit or be fired. Suppose the employee can demonstrate that the employer's actions were illegal during employment. In that case, they may be able to receive compensation or benefits.
• An employee who leaves their job voluntarily may be required to give their withdrawal, which is an advance notice, either in writing or verbally. Most industries require a two-week notice before terminating an employee. Sometimes in cases, the employee gives notice at the time they terminate, or they provide no notice whatsoever, such as when an employee mysteriously vanishes the job or fails to return to work.

The Process of Involuntary Termination

When an employer wants to lay off, dismiss or fire an employee, this is referred to as involuntary termination of employment.

Downsizing and Layoffs

Employees who are laid off are usually let go due to no fault of their own, as opposed to dismissed workers. Companies frequently remove employees or downsize their organisations to reduce operational costs, restructure their organisations, or because an employee's skill set is no longer required. Layoffs may necessitate employers temporarily suspending specific roles, as was the case during the COVID-19 pandemic, or they might be permanent due to recapitalisation decisions.

Getting Fired

Employees are typically fired due to poor work performance, inappropriate behaviour, or a negative attitude that does not align with the corporate culture. They may also be fired for unethical behaviour that violates the company's policies.

According to at-will employment laws recognised in some states, a company may fire an employee without cause if they perform poorly or break one of the company's rules. In fact, the company is not required to provide a reason for the employee's dismissal.

Unlawful Dismissals

Although employment-at-will contracts don't really require an employer to provide notice or a reason for dismissal, an employer cannot fire a worker for the following reasons:

a. Refusing to work longer than the contracted number of hours

b. Taking a day off from work

c. Notifying the Human Resources (HR) department of an incident or a person

d. Complaints to industry regulators

People cannot be fired for some of these reasons. An employer who fires an employee for trying to exercise their legal rights is breaking the law and may face legal action for wrongful termination.

Numerous illegal dismissals occur when an employer fires an employee for discriminatory reasons, such as religion, race, age, gender, disability, sexual preference, or nationality. Suppose an employer is proven guilty of wrongful termination. In that case, they may be forced to compensate the employee and/or reinstate them. 

Termination for Cause

Aside from at-will employment, an employer may fire an employee for a particular reason. A termination-for-cause clause obligates the employer to place the employee on a 60 or 90-day improvement plan during which the employee is expected to develop their work ethic. Suppose the employee needs to improve by the end of their probationary period. In that case, they may be terminated for cause and dismissed with bias.

In some situations, an employer may terminate an employee without cause. This demonstrates that the employee was fired for purposes other than incompetence, disobedience, or workplace misconduct. In such cases, the employee may well be fired and replaced for a similar position in the future.

Compensation for Termination

Other employers may also provide employees with a termination notice and/or termination pay, also known as severance pay. This is common for employees who have been with a company for more than three months and therefore are terminated involuntarily. A company that provides severance does so because of a private agreement with the employee or because severance is clarified in its employee handbook. Remember that severance packages are not required by the Fair Labor Standards Act.

Employers are not obligated by federal law to provide a final paycheck to a terminated employee immediately. However, state laws vary and may require that the employer not only provide the negatively affected employee with a final paycheck as soon as possible but also include accumulated and unused vacation days. 

Anyone out of work for no fault may be entitled to unemployment benefits. Each state administers an unemployment insurance (UI) programme to provide unemployed people looking for a job with temporary financial assistance. The Department of Labour of Malaysia includes comprehensive information on unemployment insurance benefits.

Is Termination the Same as Being Fired?

If you are fired, your employment is terminated. The justification for your termination varies, and your employer should inform you of the reason. You may be fired for improper conduct, poor performance, or because you are not a suitable candidate for the position or company.

What Are the Most Common Reasons for Being Fired?

Employers may fire employees for inappropriate conduct, poor job performance, breaching company policy(s), theft, damage to company property or use of company materials for personal gain, insubordination, taking too many sick days without justification, or being consistently late.

Some employers may include moral clauses in their employment contracts that hold employees accountable in and out of the workplace. As a result, social media activity that violates these standards may be grounds for dismissal.

What Exactly Is Wrongful Termination?

When an employee is fired for reasons strictly forbidden by employment law, such as discriminatory practices, whistleblowing, or retaliation, this is referred to as wrongful termination.

Employers who fire employees for refusing to comply with specific requests, such as performing dangerous or illegal work, are also committing wrongful termination. Companies that adjust working conditions without notice, pressuring an employee to leave or be fired, are also considered to violate employment laws.

Individuals who have been wrongfully terminated may file a lawsuit against their former employers.

How Do You Fight Employment Termination?

Suppose you were fired for a justified reason, such as restructuring or stealing company property. In that case, you may not be able to fight your resignation. However, if you believe you were fired without cause, there are some actions you can take.

Make sure you acknowledge why you are being fired. If possible, file an appeal with your employer or the company's human resources department. Request copies of documents such as your employment contract, performance-related communications between you and your employer, and employment file.

Contact your union representative if you belong to one. If you have a case, you can also seek advice from an employment lawyer about taking it to court.

Important Keynote

There are numerous reasons why employees and employers part ways. Some employees may leave their jobs voluntarily, whereas others may be fired due to misconduct, poor performance, or other factors.

If you were fired, you have certain rights. For example, if you leave voluntarily, you have the right to rescind your resignation. In addition, if you have lost your job due to no fault of your own, you have the option of filing an unemployment benefits claim. You may have legal recourse if you believe your employer fought back against you and fired you illegally, whether because you had taken a leave of absence or even because they discriminated against you. If any of these apply to you, consult with an employment lawyer.

Visit the HR Library to acquire all relevant HR resources.
Contact here for more information on hiring employees.