DISCIPLINE &
TERMINATION
Making Sure It Is Handled Properly
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Agenda – Termination
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Montana Wrongful Discharge from Employment Act
Due Process – How to Establish “Good Cause”
Documentation – Creating a Defense
Discipline & Termination Meetings
Practice Termination
Montana WDEA
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Montana is the only state to have a wrongful
termination statute
Balances interests between employer & employee
Good thing
– Limits damages to 4 years lost wages & fringe
benefits
– Employee has duty to mitigate
– Generally no right to damages for pain &
suffering, emotional distress, compensatory
damages, punitive damages, or any other form
of damages
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Montana WDEA
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§ 39-2-903, MCA – Definition of Discharge
– Constructive Discharge
• Employee terminates his employment because of
a situation created by the employer that an
objective, reasonable person would find so
intolerable that voluntary termination is the only
reasonable alternative
– Discharge
• Includes constructive, as well as resignation, job
elimination, layoff
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Protects Against Wrongful Discharge – § 39-2-904, MCA
Discharge is wrongful only if:
1. Done in retaliation for the employee’s refusal to
violate public policy or for reporting a violation of
public policy;
2. The employer did not have “good cause” and the
employee had completed the probationary period; or
3. The employer violated its own written personnel
policy.
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Montana WDEA –
Public Policy
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Employee reports a violation of
or refuses to violate public
policy
Public Policy - § 39-2-903(7),
MCA
– A policy in effect at the time of
the discharge concerning public
health, safety, or welfare as
established by constitutional
provision, statute, or
administrative rule
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Montana WDEA – No
Good Cause
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Employer has no good cause to discharge and the
employee had completed the probationary period
Good Cause -- § 39-2-903(5)
– Reasonable job-related grounds for dismissal
based on a failure to satisfactorily perform job
duties, disruption of the employer’s operation,
or other legitimate business reason.
• Reasonable Job-Related Grounds
– Undefined, but generally encompasses
termination for performance problems
• Disruption of the Employer’s Operation
– Undefined, but probably includes employees
who fail to follow procedures needed for
smooth business operation or employees whose
behavior causes disruption
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Montana WDEA –
Good Cause
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Legitimate Business Reason
• MT Supreme Court has defined as “one that is
neither false, whimsical, arbitrary or capricious, and
[has] some logical relationship to the needs of the
business.” Buck v. Billings Mont. Chevrolet, Inc.
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Arbitrary and Capricious
• Employer fails to apply its policies equally to all
employees
Johnson v. Costco Wholesale, 2007 MT 43 (2006)
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Legitimate Business Reason
• Does not include use of a lawful product (such as
tobacco or alcohol) off the employer’s premises
during nonworking hours. § 39-2-313, MCA
• Cannot terminate because employee is subject to any
number of garnishments. § 39-2-302
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Montana WDEA –
Probationary Period
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During the probationary period of employment, the
employment may be terminated at the will of either the
employee or employer on notice to the other for any
reason or no reason. § 39-2-904 (2), MCA
However, cannot terminate for an illegal reason, e.g.,
employee becomes pregnant and employer does not want
to grant maternity leave
Employer must define at the outset of employment
relationship
• Recommend 6 months to 1 year
If employer does not establish a probationary period or
provide that there is no probationary period, there is a
probationary period of 6 months from the date of hire
Employer may extend the probationary period only if the
employer let employee know at the outset of employment
that the probationary period could be extended
Once probationary period is complete, cannot put an
employee back on probation
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Montana WDEA –
Written Policy
Violation
• Employer violates express
provisions of its own written
personnel policy.
– Includes employee handbooks but also
other written policies such as memos or
preprinted forms – Kearney v. KXLF
Communications, Inc.
• Provisions that speak to “fair
treatment” or “fairness” may be
construed as a “fairness policy,”
which means a jury may be allowed
to consider the fairness of the
employer’s actions
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Montana WDEA –
Limitation of Actions § 39-2-911, MCA
• Action must be filed within 1 year after discharge
date
• Employee must go through employer’s internal
grievance procedure before filing suit
– Employer must have an internal policy that
allows employee to appeal discharge
• Employer’s Duty
– Employer must complete process within 90
days from date employee initiates process
– Employer must provide a copy of policy to the
employee within 7 days of termination,
regardless of whether it can be found in the
employee handbook
• Provide to all employees who terminate – whether
termination is voluntary or involuntary
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Montana WDEA –
Remedies - § 39-2905
• Up to 4 years lost wages, fringe benefits, together
with interest, and expenses incurred in searching
for, obtaining, or relocating to new employment
• Employee must mitigate – damages offset by wages
employee could have earned with reasonable
diligence
• No punitive damages allowed unless employer
engaged in actual fraud or malice in the discharge
in violation of 39-2-904(1)(a) – refusing to report
violation of or to violate public policy
• No other damages allowed
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Montana WDEA –
Exemptions, § 39-2912
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Does not apply to a discharge:
1. That is subject to any other state
or federal statute that provides a
procedure or remedy for
contesting the dispute.
2. Of an employee covered by a
written collective bargaining
agreement or a written contract
of employment for a specific
term.
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Blacklisting & Protection of
Discharged Employees
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Reason for Discharge
– Upon demand by a discharged employee an
employer must provide a written reason for the
discharge.
• If employer refuses, the employer cannot
provide any statement of the reason for the
discharge to any person
– A response to the demand may be modified at any
time and does not limit the employer’s ability to
present a full defense
– Get demand from employee in writing!
Absent a request for a written reason of the
termination, employers should not write an initial
discharge letter as it will be limited to the reasons set
forth in the letter if a claim is brought.
Blacklisting Prohibited
– Preventing or attempting to prevent a discharged
employee from obtaining employment with any other
person
If proven, will result in punitive damages and is also a
misdemeanor.
No person is prohibited from informing by word or
writing any prospective employer a truthful statement of
the reason for the discharge.
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DUE PROCESS
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NOTICE:
Did the company give to the employee forewarning or
foreknowledge of the possible or probable disciplinary
consequence of the employee’s conduct? “Unless your
performance/behavior is improved, it will lead to
disciplinary action, up to and including termination.”
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REASONABLE RULE OR ORDER:
Was the company’s rule or managerial order reasonably
related to (a) that orderly, efficient, and safe operation
of the company’s business and (b) the performance that
the company might properly expect of the employee?
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INVESTIGATION:
Did the company, before administering discipline to an
employee, make an effort to discover whether the
employee did in fact, violate or disobey a rule or order
of management? First-hand knowledge and
observation versus hearsay and third party information.
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DUE PROCESS
 FAIR INVESTIGATION:
Was the company’s investigation conducted fairly and
objectively?
 PROOF:
At the investigation, did the “judge” obtain substantial
evidence or proof that the employee was guilty as charged?
 EQUAL TREATMENT:
Has the company applied its rules, orders, and penalties
evenhandedly and without discrimination to all employees?
Was the bad employee treated the same as the good
employee?
 PENALTY:
Was the degree of discipline administered by the company
in a particular case reasonably related to (a) the seriousness
of the employee’s proven offense and (b) the record of the
employee in his service with the company?
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THE DISCIPLINARY
PROCESS
DISCIPLINE (dis’ e – plin)
Punishment that is intended to
correct or train. Training that
is expected to produce a
specified character or pattern of
behavior
The American Heritage Dictionary of
The English Language 1969
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Good Job
Descriptions Make HR
Work Easy
Legal
Compliance
Recruitment
FLSA
Discrimination
Law
Advertising
Screening
Interviewing
Job
Description
Performance
Management
Orientation
& Training
Coach for
Success
New Employees
Development
OSHA
Counsel for
Termination
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Confronting the
Employee
• Consistency is very important.
• Supervisors are responsible for the ongoing
assessment of employee non-performance and
conduct. Many supervisors neglect this responsibility
until the annual performance review.
• Successful supervisors take immediate action when an
employee begins to exhibit symptoms indicating poor
job performance or inappropriate conduct.
• Successful management will provide their employees
with Expectations on a regular basis, and hold them
Accountable to those Expectations.
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Do These Actions Call for
Immediate Termination?
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Falsifying company records
Deliberate destruction of company property
Gross insubordination
Sleeping during work hours
Failure to report to work
Failure to return from a Leave-of-Absence as scheduled
Sexual harassment
Improper use of information systems to access company
records
Fighting/threats of violence
Attempting to injure others
Theft or attempted theft of company or employee property
at work
Possession of a weapon at work
Reporting to work under the influence of alcohol or illegal
drugs
Possession or use of alcohol or illegal drugs on company
property is a dischargeable offense
Unauthorized disclosure of company or employee
information
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Keys to Effective Corrective
Action for Rule Violations
• If the rule violation is so serious as to
contemplate immediate dismissal, the
employee should be informed that he
or she is suspended from work until
further notice and should be told to
clock out and go home.
• When correcting an employee for a
rule violation or another type of
workplace misconduct, a supervisor
should:
– Ensure that they have all the information
by asking questions
– Follow the rules of Due Process
described earlier
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Corrective Discipline Action for
Unacceptable Behavior
• A disciplinary session to correct specific conduct that is
unacceptable should include the following.
– Informing the employee of the unacceptable
conduct as well as the proper conduct that is
acceptable.
– Explain that the improper conduct must change.
Discuss the negative consequences if it doesn’t
change.
– Exploring possible reasons for the unacceptable
conduct. Allowing the employee the opportunity to
provide some solutions relative to correcting the
problem.
– Developing a mutually agreed upon action plan to
correct the improper conduct.
– Documentation of the corrective action discussion.
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Common Signs of Employee
Performance Problems
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Absenteeism
Accidents and injuries on the job
Lack of interest in the job
Lack of follow through on
assignment
Difficulty in decision-making and
documentation
Erratic work patterns
Lack of cooperation
Decreased time spent with coworkers
Poor quality of work
Missing meetings
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Corrective Discipline to
Improve Poor Performance
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A corrective action to improve poor performance might contain
the following steps:
– Review the performance expectations for the position.
Explain to the employee why it is important to the
company and the department that he/she do well.
– Describe the areas of performance that the employee must
improve.
– Seek the employee’s opinion on why he/she feels that their
performance is not meeting the desired expectations.
– Have the employee suggest possible solutions and develop
a mutually agreed upon action plan containing specific
goals and timetables for meeting those goals.
– Have the employee commit in writing to the action plan
and provide them with a copy of the plan.
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Corrective Discipline to
Improve Poor Performance
– Follow up on a regular basis to determine whether the
performance based goals stated in the action plan are
being met. Provide feedback on how the employee is
doing.
– Catch them doing something right and praise them for it.
– If after the prescribed time frame, the employee’s
performance has improved, document and extend the
time frame to seek continued improvement.
– If after the prescribed time frame, the employee’s
performance has not improved, conduct a second
corrective Discipline, but shorten the time frame.
– Termination is possible after the third corrective
Discipline where the employee’s performance has not
improved.
– Note: (1) make sure all time frames are appropriate to
allow performance improvement, and (2) make sure there
is not another reason for the declining performance.
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Keys to Documenting
Effectively
• Clarify and confirm your facts prior to
sharing documentation with an employee.
• Make effective use of your calendar to
document.
• Emphasize any statements where the
employee admits to failing to meet the stated
expectations.
• Documented information should be
typewritten. It is neater then most
handwriting.
• Forward a copy of the signed documentation
to the Human Resources Department
promptly. Keep a copy for your records.
• Be specific relative to dates, times,
observations, etc.
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Progressive Discipline to Correct
Performance
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39-2-904 in the MWDEA – Written Policy
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Lack of consistency in how progressive discipline policies
are used by managers and supervisors.
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First violation – Oral reprimand
Second Violation – Written reprimand
Third Violation – Suspension
Fourth Violation – Termination
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When conducting progressive discipline, be specific as
possible and document everything. But most of all, make
sure you, and all management, know and understand the
steps and demands of your policy.
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Follow the preceding steps for due process and corrective
discipline, while following the steps of your policy.
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Common Mistakes in
Disciplining
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Overreact, react in anger, react in haste before gathering
facts, react to effects, not to causes, being over emotional.
Name calling, abusive reactions, attacking the individual in
degrading manner, forgetting the other person’s dignity.
(Don’t scratch their self-respect).
Trying to punish or retaliate, as if something personal
against us had been done by the individual.
Make a big show out of the discipline, rather than
disciplining in private.
Inconsistent, overreaction to this incident, but overlooked
similar instances in the past.
Failure to listen, (get the other person’s side of the story).
Lose perspective, fail to see big picture. (Remember
extenuating circumstances).
Over-disciplining differently than others were treated under
nearly identical conditions.
Gathering information to support an accusation or an
assumption rather than gathering facts to make a decision.
Attempting to prove “who’s wrong” rather than attempting
to discover “what’s wrong.”
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Thank You

www.associatedemployers.org
 406.248.6178

The information in this handout is provided for general
information purposes only.

This information is not intended to provide legal advice.

These copyrighted materials may not be reproduced,
copied or used without prior permission from AE and/or
the authors.
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