1. Presented by: Austin E. Smith Managing Shareholder, Denver Office Termination Documentation Pitfalls Colorado SHRM State Conference – Thursday, October 1, 2015

2. Our Focus for Today We pick up the discussion at the point when the termination decision has been made. We will not discuss disciplinary processes, mass terminations, or actions that may occur after the termination has been implemented. BUT, I’m happy to discuss any of these items after the presentation.....

3. Colorado SHRM State Conference – Thursday, October 1, 2015 At-Will Employment in Colorado

4. Colorado SHRM State Conference – Thursday, October 1, 2015 At-Will Employment in Colorado  In the absence of a contract to the contrary, neither party is required to give advance notice of or a reason for termination or resignation.  At-will has many exceptions, both statutory and common law.

5. Colorado SHRM State Conference – Thursday, October 1, 2015 Right to Work Employment -at- Will Only Relevant if We’re Talking about Unions Refers to Parties’ Right to End Their Relationship

6. Colorado SHRM State Conference – Thursday, October 1, 2015 Review the Documents

7. Colorado SHRM State Conference – Thursday, October 1, 2015 Review the Documents Why? Make sure the reason for termination is legitimate and well supported Make sure you are comfortable with the investigation JURIES EXPECT DOCUMENTS They expect them to be complete, accurate, and consistent Make sure they reflect adequate and objective reasons for termination Was the employee ever provided an opportunity to respond in writing?

8. Colorado SHRM State Conference – Thursday, October 1, 2015 Review the Documents Hot Tip Don’t terminate an employee without an articulated reason. Be able to express your reason in clear, understandable, and objective terms. No laundry lists. There is usually a triggering event that prompted the termination. That is the reason that should be used as the basis for the termination.

9. Colorado SHRM State Conference – Thursday, October 1, 2015 What Are You Looking For?  Stray remarks –“Smoking Guns” –Emails  Consistency –With the way similarly situated employees have been treated in the past –With company policies and past practices  Presentation  Who are the witnesses? –Evaluate their credibility –Evaluate their performance and work history

10. Colorado SHRM State Conference – Thursday, October 1, 2015 Blueprint for Your Defense  Documents are not required by law  Juries understand “at-will” but want to know “why?”  Juries look for fairness  But, documents are exhibits  Contemporaneous documentation: –bolsters credibility, witness confidence, and likeability

11. Colorado SHRM State Conference – Thursday, October 1, 2015 Documentation Bloopers  Documenting opinions/editorializing –“I think” and “I believe”  Documenting Documentation –“Is the documentation good enough to terminate? What are the next steps?” –“Documentation is not good enough at this time. Need more documentation before we can terminate.”  Speculating –Reaching conclusions not based on facts  Exaggerating –Using absolutes, adverbs, and adjectives  Allocating blame  Disclosing advice from counsel or attorneys’ work product

12. Colorado SHRM State Conference – Thursday, October 1, 2015 Severance and Release?

13. Colorado SHRM State Conference – Thursday, October 1, 2015 Is a Release Necessary?  Four Reasons to Consider Paying Severance and Obtaining a Release 1. Mass Firing/Layoff Situations (additional rules apply) 2. Employer Has Exposure to Liability 3. Employee’s Particular Circumstances 4. To Help You Sleep at Night

14. Colorado SHRM State Conference – Thursday, October 1, 2015 The Termination Meeting

15. Colorado SHRM State Conference – Thursday, October 1, 2015 The Termination Meeting

16. Colorado SHRM State Conference – Thursday, October 1, 2015 The Termination Meeting  Gather Documentation  Prepare & Rehearse  Have the Meeting  Preserve Documentation  Follow-Up (if necessary)

17. Colorado SHRM State Conference – Thursday, October 1, 2015 Gather Documentation  Termination documents  Non-compete/confidentiality agreements  Benefits information  Final paycheck  COBRA notices  Employment references  Release Agreement

18. Colorado SHRM State Conference – Thursday, October 1, 2015 Prepare & Rehearse  Consider using a script  Rehearse the meeting with your witness  Have a termination letter ready (if required)  Do you need to notify security?  Do you need to notify IT?  Will you offer the employee an opportunity to resign?  Anticipate problems that may arise  How will personal belongings be gathered?

19. Colorado SHRM State Conference – Thursday, October 1, 2015 The Meeting  In person if possible  Meet at an appropriate time of day  Find a private, quiet location  Have a witness present  Beware of recordings  Do not record the meeting  Avoid emotions  Do not apologize  Be brief and do not debate the decision  Do not overpromise  Recover company property  Avoid “perp” walks

20. Colorado SHRM State Conference – Thursday, October 1, 2015 Preserve Documentation  Keep termination documents in a safe place  Preserve all documents  Keep copies of all non- compete, confidentiality, and non-disclosure documents  Consider drafting a note to the file describing the meeting  Consider taking a snapshot of the employee’s hard drive and email account

21. Colorado SHRM State Conference – Thursday, October 1, 2015 Final Paychecks Timing & Deductions

22. Colorado SHRM State Conference – Thursday, October 1, 2015 Avoid Unnecessary Gossip

23. Colorado SHRM State Conference – Thursday, October 1, 2015 Final Paycheck Letter Hot Tip Consider providing a letter explaining final paycheck. For example: Our records indicate you have 42 hours of accrued and unused vacation. Enclosed please find a check for vacation accrued through the Separation Date, less applicable withholding amounts.

24. Colorado SHRM State Conference – Thursday, October 1, 2015 Protect Your Assets

25. Colorado SHRM State Conference – Thursday, October 1, 2015 Protect Your Assets What are your assets? Your products Your trade secrets Your confidential business information Your customers Your employees

26. Colorado SHRM State Conference – Thursday, October 1, 2015 How Can You Protect Them? Did the employee have access to “trade secrets” or confidential information Relevant handbook provisions Confidentiality agreements Codes of Conduct Non-disclosure obligations Inventions agreements Non-compete Non-solicitation of employees

27. Colorado SHRM State Conference – Thursday, October 1, 2015 Protect Your Employees  Is there a chance the employee will become violent?  Should you put police on notice?  Does the employee carry a weapon?  Increase security?  Preserve surveillance footage?  Colorado’s civil protection order statute

28. Colorado SHRM State Conference – Thursday, October 1, 2015 Presented by: Austin E. Smith Managing Shareholder, Denver Office Termination Documentation Pitfalls Colorado SHRM State Conference – Thursday, October 1, 2015