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Termination Checklist

Terminating an employee, whether voluntary or involuntary, is never fun, but it’s part of running a business. In the event a termination is necessary it’s helpful to have a checklist. Follow the steps below as a guide through the termination process.

Course Correction

When problems arise, effectively communicate to the employee(s) involved of their misconduct. A well designed discipline program is intended to help employees correct any shortcomings with the goal of becoming a valuable, contributing member of the workforce.

  • Notify the employee of their violation and keep records of these violations
  • Obtain signed acknowledgment from the employee in regards to the violationTermination Checklist Blog Picture
  • Provide employee opportunity to improve
  • Act immediately on allegations of harassment or other serious cases
  • Establish a complaint system and grievance program
  • Investigate if and when appropriate

Carrying Out the Termination

After addressing issues of misconduct and giving opportunities to improve, termination may be required.  This will aid in the creation of the termination report.  A termination report is crucial to the termination process, as it will be used in possible legal matters and will be recorded.

  • Complete the termination report
  • Draft the termination letter
  • Inform human resources and payroll
  • Inform those in charge of medical benefit plans

During the Meeting

Once the previous steps have been completed, a meeting will be held with the employee.  This meeting will be used to discuss various topics, such as retirement, COBRA, health benefits, and more.  Be sure to cover all necessary topics with the employee to avoid future issues.

  • Include the supervisor
  • Inform employee of the Consolidated Omnibus Budget Reconciliation Act (COBRA). This program allows a terminated employee access to their health benefits for a period of time.
  • Review retirement plan options such as a 401k
  • Communicate information regarding outplacement services
  • Establish contact

Post-Termination Actions

  • Contact your insurance broker to cancel employee benefits and issue a COBRA letter
  • Confidential information
  • Collect company information such as client lists and trade secrets
  • Issue final paycheck (complying with state requirements)

What steps do you take when terminating an employee? How do you overcome challenges? Share your comments with us below.

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Healthcare Reform Timeline for 2011

Just as many other U.S. citizens, we’re sure you’re confused as to what happens when with the new healthcare reform in effect. We found a very user friendly tool that gives a great timeline of what will go into effect and what will be changing from 2010 to 2015.

For instance did you know effective January 1, 2011 seniors who reach the coverage gap will receive a 50 percent discount when buying Medicare Part D covered brand-name prescription drugs. Over the next ten years, seniors will receive additional savings on brand-name and generic drugs until the coverage gap is closed in 2020.

Also effective January 1, 2011 to ensure premium dollars are spent primarily on health care, the new law generally requires that at least 85% of all premium dollars collected by insurance companies for large employer plans are spent on health care services and health care quality improvement.  For plans sold to individuals and small employers, at least 80% of the premium must be spent on benefits and quality improvement. If insurance companies do not meet these goals because their administrative costs or profits are too high, they must provide rebates to consumers.

Check this tool Healthcare Reform Timeline made available by

As always, Anderson Thornton is here to assist you anyway we can; we speak fluent Healthcare Reform and are happy to translate!

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Bonuses And Gifts And Workers’ Compensation Remuneration

While payroll is often referred to as the basis for premium, in most states it is actually remuneration and when giving year-end bonuses, it’s important to understand what is included and excluded for Workers’ Comp premiums.While the specific rules for inclusions and exclusions vary among states, in general, year-end bonuses and cash or cash equivalents such as gift cards are included in remuneration for Workers’ Compensation purposes. Some state exceptions are Tennessee that includes bonuses only when paid in lieu of wages and specified as a part of a wage contract and New Mexico that excludes bonuses paid under a state approved safety program.

On the other hand, certain gifts or perks for employees are not included in remuneration. These include employer-provided tickets to entertainment events, an airline flight, employer-provided automobiles, and club memberships. Moreover, if a special award is given for a discovery or invention, the value is generally excluded from remuneration.

This material is provided as general information and is not a substitute for legal or other professional advice.

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