Recognizing When You Have Been Fired Illegally

No type of firing is a good firing; they all burn the same. But in some cases, employers may be acting illegally by firing you. If that’s the case, there are some steps you’ll need to take to know the warning signs and keep yourself protected.

If you believe you were fired illegally, you may have a legal claim. Here’s a section of my book “The Employee Rights Handbook” that deals with just that. Read now and get informed!

Recognize the Warning Signs (#1-5)

Experts suggest that it takes roughly one month for every $10,000 of salary to find a comparable job after a termination. Thus, for example, if you make $50,000 a year, chances are you may not be reemployed within five months after being fired. While unemployment benefits will provide you with several hundred dollars of weekly income up to a maximum of 99 weeks in most states, anticipate that you may have problems paying a mortgage or rent and other regular expenses if you do not have substantial savings

That is why it is essential to heed the warning signs as soon as possible. The time to make the right moves, such as trying to establish a line of credit (which is always easier to get while you are employed) or selling a large house to avoid a potentially devastating cash drain (which takes at least several months after the decision to sell is made), is before a firing whenever possible. It is also easier to get copies of important information and documentation from your files while you are still on the payroll.

Being aware can help you detect early signs of an impending discharge. If you are left out of important meetings, hear whispers when you walk down the hall, your boss doesn’t look you squarely in the eye anymore, you are not promoted, do not receive an expected raise or promotion, are given unfavorable performance reviews or final warnings, or aren’t paid an expected year-end bonus, the employer may be telling you that you are headed for the door. If your senses tell you something negative is going on, it is time to swing into action.

Even if your concerns are unfounded, the following strategies will not harm you in any way but may help prioritize your efforts to protect the current job or enable you to look more effectively for a new one.

1. REVIEW YOUR CONTRACT. As previously mentioned, if you signed a written contract, reread it. Review what it says about termination. For example, can you be fired at any time without cause, or must the employer send you written notice before the effective termination date? Many independent sales agents, brokers, and reps receive written contracts from their principals requiring either party to give 30 to 60 days’ notice before the contract can be effectively terminated. Remember that the failure to give you timely notice, or any notice at all, may place the company in breach of contract if notification is required. To map out an effective action plan, be sure you know exactly what the contract says.

You are increasing your chances of recovering damages in a lawsuit when you are hired for a fixed term of employment. This is because the burden of proof falls on the employer to demonstrate the specific actions constituting a legitimate reason to fire before the expiration of the fixed term. Often it is difficult to do this. Thus, where possible, always try to negotiate for a fixed term of employment before being hired.

Review if the contract prohibits additional benefits on termination. Some agreements specify that employees have no additional claims for damages after discharge. Others place a limit on benefits (e.g., “Upon termination for any reason, the employee will be limited to receiving severance equivalent to two weeks’ pay for each full year of service”). By signing a written contract containing such a clause, you may be minimizing your post-termination negotiating power.

Does the contract restrict you from working for a competitor or establishing a competing business after termination? This is referred to as a restrictive covenant or covenant not to compete, which may or may not be enforceable depending on the particular facts and circumstances. Remember that your rights may be enhanced or diminished depending on the type of contract in existence. That is why it is important always to negotiate a fair agreement before accepting a job.

STRATEGY: If you remember signing a formal employment contract but do not have a copy, discreetly ask the human resources department to make you a copy of the original. If you are asked why, just say that you misplaced or accidentally destroyed your copy recently and need it for your records.

2. ACCUMULATE AND SAVE COPIES OF ALL PERTINENT DOCUMENTS AND RECORDS. Now is the time to collect all correspondence, records, and documents that may confirm your deals, the company’s actions or promises (e.g., you have been told, “You are doing a great job here, so we would never fire you without adequate notice except for cause”), or show that you are doing a great job (e.g., a recent letter from the company president thanking you for a job well done or recommending you for a raise or promotion). Accumulating such evidence can help your case immeasurably in the event you are fired unfairly and decide to take legal action down the road.

Hopefully, you have taken steps right along to indicate your dissatisfaction with unfair company actions so that a court will not conclude that you accepted such actions by your conduct. As an example, many employees refuse to sign unfair and subjective employee evaluations. This is not recommended. Rather, it is better to sign the review with a notation that you are attaching a rebuttal as part of the evaluation. This is the way to properly document your dissatisfaction, and the rebuttal can protect you against subsequent illegal action by the company.

Firing and/or disciplining workers is not as simple as it used to be. Because many terminated individuals are now consulting lawyers, companies are being instructed to “set you up” (i.e., document problems in your personnel file). The reason is that when employers have failed to note performance problems on appraisals and lack sufficient documentation to prove inadequate job performance, they may not have a legal basis for firing an employee (since a poor performance excuse may then be viewed as a pretext) and may be leaving the company open to a ready-made claim of gender, race, or age discrimination if the employee fits into one of these protected categories. Thus, it is a good idea to protest (always in writing preferably) company actions you do not agree with.

If you believe that a future lawsuit with your employer is inevitable, get the edge by planning ahead. It is easier to obtain pertinent documents, including a copy of your employment contract, employee handbook, performance reviews, and favorable recommendations contained in your file from coworkers and management while you are still working at the company.

The author represented a man who worked for a prestigious financial institution. He was part of a four-member team responsible for devising and selling tax shelters on behalf of the employer. The man had worked about nine and a half years for the company and was earning an annual base salary of $125,000. Each year he had consistently received large year-end bonuses (the previous year’s bonus had been $50,000).

The man was suddenly fired in late November. The company claimed that his work performance was not satisfactory and that he did “not fit the image of an investment banker.” The client hired me because he believed his job performance was excellent. He also felt cheated because the company offered no severance benefits, would not allow him to receive a pension that was due to vest within six months, and refused to pay him a bonus for the substantial portion of the current year he had worked.

After thoroughly investigating the matter, I inquired if the client had collected copies of pertinent information from his personnel file. Fortunately, he produced a number of excellent performance reviews. In addition, he was able to locate a memo that had been circulated throughout the company and delivered to the company’s president. The memo congratulated each member of his group by name for placing a large tax shelter that year, and each member (including my client) was cited for outstanding work.

During negotiations, management was informed of the existence of this memo. I argued that in view of the client’s history of receiving large raises and year-end bonuses, excellent performance evaluations, and the favorable memo, his firing was unjustified and was probably done to save the company a large sum of money. The company was advised that a jury would probably take a dim view of what had transpired.

After several meetings with management and opposing counsel, an out-of-court settlement was obtained that included a year-end bonus, severance pay representing one month’s salary for every year of employment, the company’s agreement to qualify my client for a substantial pension, continuation of employer-paid medical insurance for six months, substantial payment for an outplacement employment search (up to $7,500) by a reputable firm, and a favorable recommendation in writing.

It is highly doubtful I would have been able to negotiate such a favorable settlement without a copy of the “kudo” memo collected by the client. Thus, never underestimate the importance of collecting all favorable documents while working for a company.

Even if you did not keep copies of such material, don’t despair entirely. Employees may have access to their personnel files as part of the discovery process during a lawsuit even in those states that do not ordinarily allow access.

Some states have passed laws allowing employees access to their personnel records. If your state permits this, it is a good idea to view information in your file and correct incomplete or inaccurate information before you are terminated. In some of these states, you may not be allowed to copy any of the documents in the file except those you previously signed (e.g., an employment application or a performance review), but you are allowed to make notes. And in other states, you may not even have the right to review your records, so check the law in your state. (The Federal Privacy Act, which deals mainly with access to employee records, forbids federal government employers from disclosing any information contained in employee files without the written consent of the employee in question. Discuss the ramifications of this federal law with your employment attorney.)

Even in states where access to records is not permitted, employers are generally prohibited from distributing confidential information, such as medical records, to nonessential third parties and prospective employers, and you are generally permitted to inspect all your files containing confidential medical and credit information. Some union employees covered under collective bargaining agreements have the right to examine their own records and to be informed of what information is used in making decisions relevant to their employment.

Since it is often difficult to review the contents of your personnel file, make and save copies of all documents the minute you receive them so you don’t have to retrieve them later. In most arbitrations and lawsuits, employers are prohibited from introducing “memos in the file” that were never read or signed by you. This means that the company cannot attempt to prove an issue at a trial, such as your alleged misconduct, by submitting to a judge or jury a warning memo that was never given to you or that you never saw. During litigation, a few employers advise supervisors to prepare harmful documents after the fact, so be aware and advise your lawyer about this.

Some states permit workers to place a rebuttal statement in their personnel file if incorrect information is discovered. Other states allow employees to do this when the employer will not delete such comments. A few states have laws that require employers to send copies of rebuttal statements to prospective employers or other parties when information pertaining to workers or their employment history is conveyed. Since each state treats the subject differently, review your state’s law.

Some states require employers to seek workers’ approval before employee records can be collected, distributed, or destroyed, and it may be illegal to distribute personal information without your consent. With respect to medical records and investigations, the law generally recognizes that a duty of confidentiality can arise to protect this information and avoid dissemination to nonessential third parties. Under emerging state laws and case decisions, employers who request medical information may be liable for the tort of intrusion and for the tort of public disclosure of private data. Several states have recognized a claim for negligent maintenance of personnel files when files containing inaccurate medical information are made available to third parties. For example, Connecticut has enacted a statute requiring employers to maintain medical records separately from personnel files and permitting employees to review all medical and insurance information in their individual files. Thus, know your rights and review your state’s law.

3. MAINTAIN A DIARY. It is easier to remember important incidents while they are happening instead of trying to remember and writing them down later. Your main focus in any diary is to reconstruct harmful events, workplace discrimination, oral promises of job security, or statements to show you are being treated unfairly by a supervisor or manager. Keeping a regular record of promises made and not kept concerning your job can assist you if you decide later to pursue legal action. A diary will also help construct a time frame and chronology of important events and ensure that your memories are accurate. Thus, wherever possible, if you sense your job is in jeopardy, start making daily entries such as the date, time, place, and comments you heard, noting exactly what was said and the names of witnesses who overheard the statements.

Interviewers, recruiters, and officers make oral statements that can be construed as promises of job security. They sometimes use words like “permanent employment” or “job for life,” make broad statements concerning job longevity, and give assurances of continued employment or specific promises about career opportunities. When such statements are sufficient to be characterized as promises of job security, when you can prove the actual words were spoken, and when you can demonstrate that you relied on such statements to your detriment, you may be able to contest a firing. The following true case illustrates this.

An executive who worked for a company for 32 years without a written contract was suddenly fired. The man sued the company and argued that he had done nothing wrong to justify the firing. At the trial, he proved that the company’s president told him several times that he would continue to be employed if he did a good job. He also proved that the company had a policy of not firing executives except for cause and that he was never criticized or warned that his job was in jeopardy. He also proved that he had a commendable track record, his employment history was excellent, and he had received periodic merit bonuses, raises, and promotions. He won the case because the facts created an implied promise that the company could not arbitrarily terminate him.

Try to document what was said, when, where, who said it, and the names of witnesses who were present whenever promises were made. This may help your case at a later date if you are fired in a manner inconsistent with such promises and your state recognizes this exception to the employment at-will rule. Maintaining a contemporaneous diary will help you prove that such statements were actually made because you will be able to remember them in court and your recollection may be viewed as being more reliable because you could refer to a diary.


            Show the lawyer the documentation you have accumulated. If you perceive problems that are valid, your lawyer may be able to recommend additional strategies, such as sending a final letter of protest or requesting a meeting to discuss and attempt to resolve the difficulties. These options may not be available after your firing and can enhance your case if litigation proves necessary.

The lawyer can give you a better evaluation of the possibility of success with your case when he or she has viewed all pertinent records and documents. That is why it is important to collect key evidence for presentation to your lawyer before a case is litigated. Be aware of this and act accordingly.

5. START LOOKING FOR NEW EMPLOYMENT. The best time to seek reemployment is while you are still working. There is less pressure to find a replacement job when a steady paycheck is still coming in. You also have the luxury of not appearing as hungry, since the prospective employer knows you are currently employed. This means you may have more clout and be able to command a higher salary or more benefits during negotiations.

People often ask if it is legal to look for a job while they are still employed. The answer is yes, provided you do so discreetly and not on company time. Thus, schedule your telephone calls and interviews during lunch hours or after work. If you have to prepare for and attend an important interview, take a vacation day.

If you are employed full-time but also work for a competitor or hold another job, that is probably illegal without your employer’s knowledge and consent. For instance, one salesperson was accused of violating his duty of loyalty by distributing a competitor’s catalog to his customers while still working for his company.

In preparation for quitting a job, you are generally allowed to look for another job without advising your employer. You can quietly advise customers and friends of your intention to leave and even take minor steps to compete and organize a new company while still working (e.g.,prepare stationary and business cards or arrange for a new telephone number if you are going into business for yourself).

What you cannot do is take active steps, such as solicit business for the new entity, while on your present employer’s payroll, hurt its reputation by talking poorly about your employer, or lie down on the job by not taking orders or working as diligently as before.

Start calling business contacts for leads. Prepare long and short lists of all the people you would call if you did lose a job and start calling them regularly. It is essential to maintain an active network of business associates, and now is the time to start. You may want to make a personal copy of your Rolodex™ for this purpose.

Update your resume. Schedule an appointment with a career counselor or an employment agency for advice and guidance.

In addition, some employees believe that if they are fired illegally, they can delay going back to work because their former employer will have to pay them damages. This approach is wrong for two reasons. First, a person should never assume that his or her lawsuit will succeed. Second, even if you sue your former employer and win, your damages will be cut back severely if you fail to mitigate your damages—i.e., you fail to take active steps to find comparable employment.

What is comparable employment? The answer may be somewhat subjective, but, for example, a terminated physician cannot be required to accept employment as a gardener to mitigate her damages.

By the same token, a security guard at an office complex would probably not be justified in failing to pursue or accept employment as a security guard at a residential complex. The result here would be different if the security guard position at the residential complex required an additional 15-20 hours per week of work. The bottom line is that the new position should be similar to the former position, but it need not be identical. Therefore, do not pass up a job that is similar to the one from which you were terminated.

Finally, if you think you were fired in violation of your rights, either contractual or statutory, it is essential that you maintain a post-termination diary documenting all of your efforts to find suitable alternative employment. Every letter, phone call, newspaper clipping, review of websites, etc. should be documented. The more detail the better. If you file a lawsuit and have not thoroughly documented your efforts to find suitable alternative employment, the judge or jury will likely conclude that you failed to mitigate your damages, and any award that you might have otherwise received may be substantially reduced as a result. Don’t make this mistake.

For a full depth analysis on this topic and many more, visit to purchase “The Employee Rights Handbook” today!

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