Firing an employee for a valid reason is termed “termination for cause.” This dismissal occurs due to misconduct, fraud, or revealing confidential information. The ’cause’ typically arises from a written agreement, like an employment contract or company rules. Thus, this article guides you through understanding termination and managing it when looking for a new job, including how to file a claim if necessary. 

What Does Termination With Cause Mean?

So, what is termination for cause? It’s one way an employer can end an employee’s tenure. This occurs when an employee’s actions breach policies and could harm the company, clients, or coworkers.

Reasons for this kind of termination might involve breaking company rules or consistently performing poorly. Therefore, it could also involve having problematic relationships with colleagues or mistreating clients.

When an employee is terminated with cause, the specific reason should be clearly stated in their termination letter. If there’s no clear reason provided when an employee is fired, it’s considered termination without cause. Therefore, this distinction matters when dealing with long term disability insurance or other benefits.

What Are The Reasons behind Termination For Cause?

Firing an employee for sufficient reasons like misconduct is termination for cause. While it doesn’t always mean misconduct, in places like Texas, it often does.

Reasons for termination for cause may include:

• Falsifying records
• Sharing confidential info
• Serious misconduct
• Not following orders
• Stealing
• Being convicted of a crime or violating a contract can also lead to termination for cause.
• Embezzlement
• Lying
• Breaking company rules or policies
• Fraud
• Failing a drug or alcohol test

Reasons In Detail

Now, let us look at these reasons, in detail.

Alcohol/drug-related misconduct

Some companies don’t allow drinking or using drugs at work. If an employee breaks these rules, it can lead to getting fired.

Bribery

Taking or giving bribes at work is against the rules and can lead to getting fired.

Incompetence

If an employee doesn’t do their job well or doesn’t try to improve, it can lead to getting fired.

Gross insubordination

This means not following rules at work, like not showing up or being rude to bosses. Therefore, if an employee doesn’t follow the rules or is rude, it can get them in trouble and fired.

Inappropriate relationships

Relationships at work should be professional. If someone gets into a romantic relationship at work, it can cause problems, like treating others unfairly or making the company look bad, and that could lead to getting fired.

Gross misconduct

This means behaving in a way that’s really bad at work, like breaking important rules or damaging the company’s reputation. Therefore, every company has rules about how to behave at work, and breaking these rules can get you fired.

Theft

Taking something that doesn’t belong to you from work, like office supplies or using work stuff for your own benefit, is stealing. Therefore, if you take things that don’t belong to you, it’s considered stealing and can get you fired.

Breach of confidentiality

Companies have secrets or private information, and employees should keep it safe. If an employee shares this secret information, it’s called a breach of confidentiality and can lead to getting fired.

Conviction for an offense

If an employee gets in trouble with the law and the company has rules against that, it might lead to getting fired.

Serious breach of safety rules

If an employee does something that puts others in danger at work, like ignoring safety rules, it can lead to getting fired.

Bankruptcy

Some jobs need employees to be good with money. Therefore, if an employee isn’t good with money and goes bankrupt, they might get fired.

Termination For Cause: How Does It Work?

Employees let go without cause may receive severance pay as per company policy. This affects things like long term disability insurance or other benefits.

1. Termination for cause means ending employment for specific reasons, usually allowed in “at-will” employment, except in Montana, where it’s presumed you can be fired for almost any reason except discrimination.

2. Federal law generally doesn’t require employers to give notice when terminating an employee for cause, except in cases of mass layoffs or plant closures under the WARN Act.

3. Immediate termination for cause can occur if an employee violates company policies, such as being under the influence of drugs at work or breaching a non-disclosure agreement by sharing proprietary information.

What Do Federal Laws Say? Equal Employment Opportunity Commission

Wrongful termination occurs when an employer fires you illegally or breaks the terms of your work agreement.

For instance, if you’re dismissed for being a whistleblower, it’s wrongful termination. Laws protect your right to report unsafe conditions or rule violations at work. Similarly, if you’re fired due to your race, religion, pregnancy, or other legally protected reasons, it could lead to a wrongful termination lawsuit for discrimination.

If you believe your termination was unlawful or violated company rules, seek assistance. The U.S. Department of Labor and the Equal Employment Opportunity Commission (EEOC) offer guidance on filing claims and addressing discrimination issues.

Therefore, you might need to file a discrimination charge with the EEOC if necessary.

Also, you can refer to our article on trust fund for more on the matter.

Unemployment And Termination

Losing a job for cause might impact your eligibility for unemployment benefits, but this varies by state. Contact your state’s unemployment office for specific guidance. Therefore, if denied benefits, you can appeal and clarify why you were terminated.

Being fired for cause doesn’t automatically mean you can’t receive unemployment benefits. It’s important to confirm this through proper channels.

Some employers might offer severance or term the dismissal differently to avoid issues with terminating for cause, which could impact your benefits. 

What Does Termination Without Cause Mean?

Now that we are done talking about termination for cause, let us dive into more. Despite the term, there’s always a reason behind it. It usually happens due to budget issues, company restructuring, or downsizing.

When an employee is terminated with cause, the employer might withhold some benefits and isn’t required to give notice or compensation. But in termination without cause, the employer might provide a notice period or pay an equivalent amount. 

How To Handle Termination For Cause?

Managing termination for cause might be a surprising and confusing experience, even if you sensed it coming. Questions about unemployment benefits, your rights, and the status of benefits like retirement or health plans after termination are common.

Human resources is your initial point of contact for answers to these concerns, despite no longer being your employer. They are responsible for providing former employees with the necessary information to move ahead.

Therefore, reach out to your state’s unemployment office or labor department for details about specific benefits available in your area.

Takeaways

Termination for cause occurs when an employer has a valid reason to end an employee’s role.

Employee misconduct usually leads to termination for cause.

Therefore, consult your former company’s human resources department if you’ve been terminated for cause, especially regarding pay and other issues.

To Conclude

Termination for cause happens when an employee gets fired because of serious reasons. For example, it may be like breaking important rules or doing things that harm the company. Therefore, it’s important to follow the rules at work, be responsible, and treat everyone fairly.

If not, it could lead to losing the job. Being aware of the rules and doing the job well can help everyone avoid getting fired for cause.