Layoffs are an unfortunate but sometimes necessary element of offering employment. When companies experience downturns, they may have to reduce their operating budgets. Layoffs are often a part of that process.
Eliminating salaries and benefits packages can profoundly impact company finances. Most employees let go due to restructuring and downsizing move on and find new employment. Some of them, however, may aim to regain their jobs.
Others might demand financial compensation for the impact of sudden job loss. They might claim that layoffs were wrongful because they were discriminatory and file a lawsuit against their former employers.
How can employers respond effectively?
Prevention is the best medicine in a wrongful termination scenario. The steps taken before laying workers off can help counter claims that the process was discriminatory. Documentation of job performance and other factors that influence the decision-making process can help push back against claims that the company considered protected characteristics when deciding which workers should keep their jobs in which ones were included in the layoff.
Ideally, employers review the list of proposed layoffs carefully to look for trends, as that can help prevent claims of discrimination based on layoffs having a disproportionate impact on certain groups. If layoffs have already occurred and terminated workers now assert that they belong to a group disproportionately affected, the company could be at risk of a wrongful termination lawsuit. Employers may need to defend their decision-making process and overall employment practices.
Discussing major staffing moves with an employment and labor law attorney can help organizational leadership minimize the risks of post-layoff wrongful termination litigation. Appropriate preventative measures and assertive responses to pending lawsuits can both limit the negative impact of layoff-related worker litigation.