December 9, 2013
Ohio is an at-will employment State. This means, employees can be terminated for any reason or no reason at all. There are three caveats to that rule. First, employers can’t take adverse employment actions against their employees for discriminatory reasons (e.g. race, color, religion, national origin, age, gender, military status, etc.). Second, if the employer is in the public sector, adverse employment actions are often restricted by statute. Third, any employer who utilizes employee contracts, this includes union employees, must follow the terms of the agreement in pursuing adverse employment actions.
Typically, for a period of six months to a year, whether or not an employee works in the private or public sector, they will be subject to a probationary period. During an employee’s probationary period they can be let go without “just cause.” A standard probationary removal letter may state as follows:
Dear Probationary Employee,
I am writing to you in regards to your job related performance in the position of Worker. You were hired on X Date by Employer for the position of Worker. This position includes a six month probationary period. Currently you are still within the probationary period. The purpose of this period is to orient the employee to his/her new job and to determine the employee’s suitability for the position.
It has been determined your employment as the Worker is not progressing as expected.
You are hereby ordered to return all employer property and keys immediately. If you are due any wages, such wages shall be payable on the next regular payday in accordance with policy so long as all agency property and keys are returned.
I wish you well in future endeavors.
Sincerely,
Employer
There is nothing wrong with the above the letter. However, if the Probationary Employee above had been employed by the Employer for longer than 20 weeks at the time of the probationary removal, he/she would be likely be granted unemployment benefits if he/she applied.
Many employers do not realize or may believe that since they do not need “just cause” to terminate a probationary employee they will not face any potential financial liability from the removal. This is incorrect. Employers still need to prove that “just cause” existed for the termination of probationary employees if they wish to avoid having to pay unemployment benefits.
The Ninth District Court of Appeals in Dugan v. Ohio Bur. Of Employment Servs., 110 Ohio App. 3d 545, 549-50 explained:
It is important to distinguish between just cause for discharge in the context of unemployment compensation and in other contexts. An employer may justifiably discharge an employee without incurring liability for wrongful discharge, but that same employee may be entitled to unemployment compensation benefits. This is so because just cause, under the Unemployment Compensation Act, is predicated upon employee fault. We are, therefore, unconcerned with the motivation or correctness of the decision to discharge. The Act protects those employees who cannot control the situation that leads to their separation from employment. (Internal citations omitted).
Accordingly, regardless of the reasons an employer gives for discharging a probationary employee, whether a probationary employee has been terminated for “just cause” for purposes of determining unemployment benefits is a separate and distinct question.
What should employers do?
Employers should document unsatisfactory work performance, policy or rule violations, and any counseling sessions in the same manner as they do for employees who have completed their probationary periods. Proper documentation will enable employers and their representatives to successfully challenge applications for unemployment benefits.
For more information on this topic, please feel free to contact Andrew A. Esposito at (614) 923-7700 or via email at aesposito@clemansnelson.com.