Internal Procedures for Employment Discharge
A potentially important tool to avoid wrongful discharge claims exists under Montana law, but it is often overlooked or neglected by employers. Montana law allows for an employer to adopt written internal procedures which will allow an employee who is terminated to appeal the discharge with his or her employer. Such a procedure can provide two benefits.
First, it can be a valuable human resources tool. Employers should consider whether they should adopt such procedures. A discharge appeal procedure can help ensure that the right employment decisions are made at the right time for the right reasons by the right persons. An appeals process might possibly head off a potentially wrongful discharge before it starts.
Second, the appeals procedure could in many circumstances provide a winning defense if a discharged employee actually brings a wrongful discharge lawsuit. If an employer does adopt a written procedure which allows the appeal of a discharge decision, Montana's Wrongful Discharge Act provides that the discharged employee must first initiate or exhaust the internal procedure before filing a discharge lawsuit. If the employee does not, his or her failure to do so is a specific defense to any wrongful discharge claim. Thus, the employee's failure to initiate or exhaust the process might very well lose his or her case.
However, there is a potential trap for unwary or neglectful employers. In order to assert this defense, the employer is required by law to provide written notice to the discharged employee within seven days of the discharge about the internal appeals process, and provide a copy of it. If the employer fails to do so, the employer cannot assert the defense of failure to initiate or exhaust the internal process. Therefore, it is very important that the employer ensure that the notice is always sent out as part of the standard procedure in any discharge situation.
At the Moulton Law Firm, we have several attorneys who have a significant amount of expertise in all areas of employment law. Please feel free to contact us if you need assistance or have questions on any employment law issue.