Documentation of Employee Discipline

Boring but True: Four Rules on the Documentation of Employee Discipline

Few things are less flashy than the process of creating a detailed personnel file including reports on disciplinary action taken against an employee.  This is especially true when the documents and reports sometimes disappear forever into a filing cabinet or drawer, never to be seen or used again.  However, when a dispute with an employee does arise, this humdrum activity becomes critically important for an employer to protect itself from exposure to legal liability.

Is your company actually at risk?  Unfortunately, the answer is likely “yes.”  The reality is that formal legal disputes between an employee and an employer are not all that uncommon in the United States.  According to the U.S. Equal Employment Opportunity Commission, there were just under 90,000 charges of discrimination filed by aggrieved employees in the United States in 2014.  Unfortunately, employment related disputes give rise to one of the most common types of civil lawsuits in America.

The cost of an employee lawsuit to your company can be tremendous.  Some statistics show that an average out-of-court settlement approaches $40,000.  To add insult to injury, these amounts do not include attorney’s fees which are typically incurred in reaching the settlement.  And as you can easily imagine, an employee’s settlement demands as well as the attorney’s fees and costs usually balloon once a formal lawsuit has been filed in state or federal court.

Because the consequences of an employment lawsuit can be so severe, a company is wise to implement practices which will help the company defend itself if an employment dispute does arise.  One of the most important practices relates to the documentation of discipline.  Discipline and documentation go hand in hand.  No employer should discipline an employee without documentation, and no documentation should be created without following a discipline and documentation policy.

Here are four rules that your company should follow.

Rule #1: Review and renew your documentation practices and policies immediately!

The most important rule is that you implement and follow an effective discipline and documentation policy as soon as practicable.  An effective policy on these areas will increase the chances of success if an employment dispute arises.  The simple fact is that judges and juries expect employers to have documentation to support virtually all of the employer’s claims and defenses.  The absence of documentation is viewed with great suspicion.  So, even though documentation may not be strictly required, a lack of documentation can be devastating to your case when a dispute arises.

Effective documentation also reduces the chances that a lawsuit will occur.  This may be because an aggrieved employee will have a diminished view of his or her chance of success in a lawsuit where there is a history of well-documented disciplinary issues.  Similarly, the Equal Employment Opportunity Commission (EEOC) or Colorado Civil Rights Division (CCRD) may be less likely to make a finding of reasonable cause that discrimination occurred, thereby discouraging a current or former employee from filing a lawsuit.

Appropriate documentation also has some non-legal benefits.  For example, employee behavior is likely to improve if an effective discipline policy is followed and employee-expectations are carefully molded.  Improved employee behavior could also mean a boost in morale and improved productivity and efficiency in the workforce.

Rule #2: Tell a clear story. 

Effective documentation will educate your employee and persuade judges and juries.  To accomplish these goals, you must conduct some investigation before you ever put pen to paper.  Get the employee’s side of the story as well as those of your managers and others.  Be fair and objective!  Once you have the facts, do your best to leave out subjective viewpoints, harsh adjectives and labels.  Instead, be honest, objective and factual.  And never leave out the specific instances of conduct that gave rise to the need for discipline.

Also, never forget to include a description of where you have been, where you are, and where you are going.  What discipline has been imposed in the past?  What specific discipline is being imposed now?  What will happen next?  If the employee’s behavior does not change or improve, will he or she be subject to additional discipline?  Inform the employee of the company’s specific objective expectations and that additional violations may result in further discipline up to and including termination.

Rule #3: Speak directly to the investigators, lawyers, judges and juries.

Remember that only part of your documentation practices are aimed at educating your employee and furthering the discipline process.  The other very important part is educating and persuading those in the legal system.  Investigators with governmental agencies, lawyers, judges, juries, mediators and arbitrators: these are the people who will most likely decide the outcome of your case.  And yet most of them know nothing about your particular industry or your specific circumstances!  It is important to craft documentation which will be understandable to those who lack this knowledge.  Avoiding jargon, telling a clear story and explaining how the employee’s behavior is a problem for your particular business will go a long way toward helping them understand why discipline was needed and appropriate.

Perhaps most importantly, you want it to be clear that the employee was given notice of the problem and an opportunity to improve.  Therefore, make sure that a copy of your disciplinary documentation was given or at least shown to the employee.  You may request that the employee acknowledge its receipt by providing his or her signature.  If the employee resists, you may explain in writing that by providing a signature, the employee does not acknowledge guilt or the truth of any of the facts described.  Instead, the employee is only acknowledging his or her receipt of the disciplinary documents.  If the employee ultimately refuses to provide a signature, you may note that fact in the documentation itself.

Rule #4: Avoid the pitfalls!

Just as your company’s documentation can be used to defend against claims by employees and former employees, it can also be used to try to prove claims of unlawful discrimination.  Be sure that your disciplinary actions are not taken for retaliatory or discriminatory reasons.  Make sure that, by taking disciplinary actions, you are following the company’s own published policies as well as any applicable labor or employment agreements.  You should also keep in mind that, when imposing discipline, it is important that similarly situated employees receive similar treatment.  What discipline was imposed for similar incidents in the past?  How were other employees treated in similar previous circumstances?  You should make efforts to assure that employees are treated fairly across the board.   Most importantly, the company should never use an employee’s recent protected activities (whistleblowing, complaints of discrimination, etc.) or their status in a protected class (e.g. race, religion, age, gender, etc.) as a basis for determining whether discipline is appropriate or necessary.

As an employer, your goal should always be to respect your employees’ legal rights under all of the various state and federal laws, while seeking to enforce nondiscriminatory rules and norms within your workplace.  An employer must be careful when considering discipline for an employee who may believe that the disciplinary action is a pretext for unlawful discrimination.  For example, an employer may be faced with a difficult situation when discipline is needed for a worker who previously complained of discrimination or harassment, for an injured or disabled worker, for a worker who recently filed a worker’s compensation claim or one who recently took leave under the Family and Medical Leave Act.  In such circumstances, clear documentation is more important than ever.  To protect the company, you must be very clear that the discipline is being imposed for nondiscriminatory and non-retaliatory reasons.  In such cases, it is often helpful to consult with an attorney before taking disciplinary action.  However, by carefully following the four rules described in this article, an employer can create compelling proof of the true, nondiscriminatory reasons for an employee’s discipline or discharge.

Damien Zumbrennen is an attorney with Frascona, Joiner, Goodman and Greenstein, P.C. His practice areas include Real Estate, Employment Law, Litigation, and Construction Defect. Contact Damien Zumbrennen.

Disclaimer — Content is general information only. Information is not provided as advice for a specific matter, nor does its publication create an attorney-client relationship. Laws vary from one state to another. For legal advice on a specific matter, consult an attorney.

T. DAMIEN ZUMBRENNEN