While no one likes to think about it, one of the risks of doing business is the possibility of a lawsuit. This risk can increase when you have employees. No matter how loyal your employees seem to be, there is always a chance that you will do something, someday, that will make one of them decide to take you to court. It’s important for any employer to be familiar with employment laws, to make sure they are being followed, and to protect yourself from litigation.

Washington, an At-Will State

One of the major pieces of employment law in Washington is that it is an “at-will” state when it comes to employment. This means that employers can, with some exceptions, hire and fire employees at will, with or without cause, and that employees can accept jobs and quit them with equal impunity. Employers need to be careful, however, not to violate, or appear to violate, any of the state or federal discrimination statutes, which prohibit businesses from making employment decisions based on race, sex, age, disability, or national origin.

Employment contracts that stipulate fixed terms of employment can also prevent an employer from letting an employee go. Even if your business does not use contracts, it’s a good idea to review documents such as hiring letters and policy manuals to make sure that they don’t include any language that could be construed as a guarantee of employment. Verbal representations by the employer also tread into dangerous territory, so make sure that supervisors, HR personnel, and others are well trained in these matters.

Hiring

When it comes to hiring, “it’s the employer’s duty not to discriminate,” said Ed Wolfe, attorney, of Wolfe Law Offices, PLLC, in Bremerton. State and federal anti-discrimination laws come into play again here.

“You have to make sure that when you’re interviewing, you don’t ask dangerous questions,” said attorney John Kenney, of Lineberry Kenny’s Poulsbo office. This includes inquiring into marital status, religion, race, potential disabilities, age, whether the interviewee has children, and so on.

“You just don’t go there,” said Kenney.

Conduct interviews for a specific position and make sure that you have a written job description of the position that lists required skills available during the interview. This ensures that the interview questions asked are specific to the requirements of that position, and helps you avoid those “hot” questions.

Reference checks, an important part of the hiring process, must also be handled very carefully. Wolfe advises his clients to have prospective employees sign a waiver and hold harmless agreement before checking references. If written correctly, this waiver can offer protection for both the potential employer and any former employers who provide reference information.

Employee Rights

For the most part, the law is on the employer’s side when it comes to rights in the workplace.

“In the workplace the only rights employees really have are things that the employer has committed to in writing in employment policies,” said Kenney.

There are some exceptions to this, however. There is a statute in Washington that gives employees the right to review their personnel files, if those personnel files are part of records that are regularly maintained by the company as part of the company’s business records. Documents that contain sensitive, personal information about employees, such as social security numbers, addresses, home phone numbers, and so on, must be kept in a secure area.

It is legal for businesses to use video monitoring equipment to keep tabs on their employees — except for places where employees have reasonable expectations of privacy, like restrooms and locker rooms. But federal and state laws both prohibit employers from transmitting or recording their employees’ private conversations, unless the employees give explicit permission to do so.

One area where employees can’t expect privacy is on company email systems and computer networks. Technically speaking, any piece of workplace equipment is the property of the employer and employees who use those systems for non-work-related activities cannot expect those emails or Web site visits to remain private. Employers should have good Internet and email policies in place to make sure employees know what is acceptable and to avoid potential conflicts.

Payment of Wages

The federal government, not the state, establishes minimum wage laws and overtime laws. Generally speaking, the standard for payment is that each individual employee working an hourly job with no contract is entitled to be paid for every hour they work.

The state statute does require that employers pay out all wages to an employee being terminated by the end of the normal pay period, unless there is a bona fide wage dispute. If wages are not paid out on time, the employer could be liable for double damages plus attorney’s fees.

Termination

Letting an employee go, whether due to performance issues or because of downsizing or restructuring, is never an easy task. Termination, both attorneys note, is one of the main reasons that employees and employers end up in litigation. And while Washington’s at-will employment law technically allows employer to fire employees whenever they choose, it is not always the best course of action to fire an employee on the spot.

“I always develop a checklist for my clients,” said Wolfe. Wolfe’s pre-termination checklist provides employers with a list of items to review before making the decision to let employees go. This list of considerations include checking for existing employment contracts, reviewing anti-discrimination statutes, and, if firing for cause, looking at what policy or rule the employee violated, reviewing whether the employee was notified of the violation, and determining whether an investigation of the violation was completed.

Kenney recommends that employers conduct regular performance reviews, in writing, for every employee. This record of reviews can be vital if it ever becomes necessary to fire an employee.

“You always have to think in terms of being litigated,” said Kenney. “In an at-will state there’s not a lot you can sue for,” he continued, “so usually a wrongful termination suit will try to fit the employee into one of those protected classes.”

Letting an employee go without having a complete record of performance issues can open yourself up to such wrongful termination claims. For example, if an employee attempts to sue claiming she was fired for her age or gender, a thorough written record of that employee’s regular tardiness and repeated warnings could protect her former employer from damages.

“What’s the best way to fire someone? As non-confrontationally and in as non-inflammatory a manner as possible,” said Wolfe. Wolfe recommends employers always have two people in the room when an employee is let go, such as the employee’s supervisor and a human resources manager, and that written notes be taken during that meeting and saved in the employee’s personnel file. Employers do not have to give a reason as to why an employee is being let go during a termination meeting, but Washington state law does require an employer to provide a reason in writing if the employee demands one.

Make sure that you get all keys, computer codes, and so on from an employee immediately. If your company has a non-disclosure agreement, you should remind the employee of their obligations to it. Most of all, don’t talk to other employees about the firing. Doing so could open your company up to accusations of slander.

(Editor’s Note: This article is designed for informational purposes only and is not intended as legal advice. You should seek the advice of your own attorney or corporate counsel if you have specific questions about the issues addressed here.).