Tip Sheet: Pink-Slip Protocol

Here's how employers can play fair and protect themselves from legal repercussions at the same time

Companies that terminate employees the way that Donald Trump does on The Apprentice are courting legal disaster. In the real world, employment attorneys recommend a more cautious process. Here are some key steps they suggest you take before you fire someone.

Case in Point

How the threat of litigation is making companies skittish about axing problem workers. Would you have dared fire Hemant K. Mody?


In February, 2003, the longtime engineer had returned to work at a General Electric Co. (GE ) facility in Plainville, Conn., after a two-month medical leave. He was a very unhappy man. For much of the prior year, he and his superiors had been sparring over his performance and promotion prospects. According to court documents, Mody's bosses claimed he spoke disparagingly of his co-workers, refused an assignment as being beneath him, and was abruptly taking days off and coming to work late.

But Mody was also 49, Indian born, and even after returning from leave continued to suffer a major disability: chronic kidney failure that required him to receive daily dialysis. The run-ins resumed with his managers, whom he had accused flat out of discriminating against him because of his race and age. It doesn't take an advanced degree in human resources to recognize that the situation was a ticking time bomb. But Mody's bosses were fed up. They axed him in April, 2003.

The bomb exploded last July. Following a six-day trial, a federal court jury in Bridgeport, Conn., found GE's termination of Mody to be improper and awarded him $11.1 million, including $10 million in punitive damages. Read more.