By Linda J. Hay, JD
Many dental practitioners who own their business do more than practice dentistry; they also play roles in hiring and firing employees. The discipline and termination of employees may be subject to federal, state, and local laws. Despite some variation in the nature and type of laws that will impact a particular situation, some general principles apply to the employer-employee relationship at any level.
Many states are at-will states, meaning that employers can hire or fire for any reason, but this is limited by the bounds of federal law relating to discrimination in relation to race, age, gender, etc. (protected classes). In these instances, if an employee who is in a protected group or class is terminated, it may be incumbent on the employer to establish that the employee was terminated for a legitimate, nondiscriminatory reason. Timely documentation becomes important evidence in such a case. Most typically, courts that have addressed employment issues favor employers who have kept timely documentation and recognize, investigate, and address discipline and related issues. Courts also like to see that employers are treating all employees similarly.
The following list may provide the dentist-employer some tips on how to alleviate risk in the discipline of employees.
1. Documentation of the personnel file is critical.
Every employee should have his or her own personnel file. In that file, the dentist should keep and maintain not only requisite forms that relate to taxes, benefits, confidentiality, and performance evaluations, but also all internal documentation concerning specific issues, problems, discipline, investigation, and analysis of any employment issues that pertain to the employee. For example, if an employee is reprimanded for taking personal calls while seeing patients, the personnel file is the appropriate place to objectively document the who, what, when, and where of the problem and how it was addressed. Whenever there is a potential for litigation or a claim involving an employee's termination or discipline, the first thing that will be requested by the employee and his or her lawyer is the complete personnel file.
2. Prepare regular, honest, and accurate performance reports.
Regular, written performance reviews are important even if the office is small and the relationship with the employee is a close one. Written reports assure clear communication of positive and negative issues. They should cover the substantive work performance and also attendance, adherence to policies and standards in the office, and other job requirements. In a review setting, problems can be addressed in a nondisciplinary manner. All performance reviews should include an acknowledgement by the employee of receipt of the evaluation. A sugar-coated performance review will never be of use and could have an unfavorable impact on an otherwise defensible employment decision.
3. Avoid creating an employment contract when that is not the intent.
If you practice in an at-will state, be aware that if you contract with an employee, the terms of the contract will typically govern your relationship with that employee. Such a contract may impact your ability to discipline or terminate that employee. The simplest example of an unintentional creation of an employment contract is when an employee handbook is deemed to be the employment contract. It is for this reason that an employer must have some assistance with preparation and acknowledgment of receipt of such a handbook or written policies. Great care must be taken to ensure that policies and terms of the handbook are employee guidelines and not requirements, and the employee acknowledgement must state clearly that the signature does not create a contract.
4. Be consistent in discipline of employees.
Violations of policy or protocol should be applied similarly to all employees. For example, if Employee Sue is always late to work, but all the patients love her and ask for her, and Employee Mary is always late, but the patients do not like her as much, the employer must try to apply the attendance rules similarly to Sue and Mary. Any discipline of Mary should be based upon the personality problem with the patients, not on attendance (and this should be well-documented.)
5. Be clear on the conduct that may result in discipline or termination.
If there are any policies in your office that may result in a termination, be clear on the communication of that issue to your employees, be consistent in how you apply that discipline across the board, and document the actions.
6. Be aware of an employee's protected status under the law.
Many laws prohibit termination of an employee based on race, age, gender, religion, sexual orientation, pregnancy, disability, etc. If the dentist has problems with an employee who is clearly a member of a protected class, the employer should ensure that there are clear, well-documented, legitimate, nondiscriminatory reasons for the termination. If the dentist is unsure of an employee's protected status, it may be better to investigate this issue prior to termination. Consultation with a lawyer or some other educational source can generally provide the guidelines.
7. Establish guidelines for conduct.
This is most often set forth in the nature of an employee handbook. Because the employer does not want an employee handbook to be deemed an employment contract, the employer should refer to the handbook or policies as guidelines. If the policies are stated and referred to as requirements, the employer will have a hard time explaining why he or she did not follow his or her own requirements. Again, however, these guidelines must be applied consistently.
8. Timely recognize problems.
If there is an issue with an employee that requires discipline, that issue should be noted timely in the personnel file and addressed timely with the employee. For example, if an employee is fired for consistent and chronic tardiness, the personnel file should reflect many instances over a lengthy time when tardiness was noted and the employee was told, reprimanded, put on probation, etc. The courts do not favor employers whose reason for termination is chronic and consistent tardiness, and then review a personnel file that documents three instances of tardiness in the week before termination.
9. Obtain employers' liability insurance.
Litigation by disgruntled employees may occur. If it does, the prudent dentist will want to be assured that there is protection from attorneys' fees and costs and potential payout on a claim. A dentist should discuss this type of insurance coverage with her insurance broker or those who help place coverage. Fees and costs in these types of cases are often expensive, and these types of claims may go through an administrative process before they even get into court.
10. Stay updated on employment law issues.
Attendance by the dentist or office manager to yearly seminars about employment issues from a risk-management perspective is critical. The smart practitioner should have a general understanding of red-flag issues and important updates in the law.
Linda J. Hay, JD, is a partner at Alholm Monahan Klauke Hay Oldenburg, LLC in Chicago. She graduated from The John Marshall Law School in 1986 and has defended dental professionals for more than 15 years. She may be reached at [email protected].
