Most common mistakes during the employee termination process and their consequences

Employee termination is one of the most sensitive moments in the employer–employee relationship. Mistakes made at this stage can lead not only to court disputes, but also to serious financial, reputational, and organizational losses. 

From our experience, even employers acting in good faith are often unaware of how costly an improper termination of an employment contract can be. 

Below, we discuss the most common mistakes in employee terminations, indicate their consequences, and show how they can be effectively avoided. 

Incorrect indication of the reason for termination 

One of the most common and at the same time most costly mistakes is providing an overly general, vague, or untrue justification for termination, especially in the case of indefinite-term contracts. It is also a mistake to formulate reasons in a way that is intended to “avoid offending” the employee through overly direct wording. 

The reason for termination should be: 

Possible consequences for the employer: 

• lost court case,  

• reinstatement of the employee or  

• payment of compensation of up to 3 months’ salary,  

• reimbursement of the employee’s litigation costs and legal representation fees,  

• reputational losses resulting from a lost case.  

Violation of employee protection regulations 

Labour law provides special protection for certain groups of employees, including: 

• pregnant employees,  

• employees in pre-retirement age,  

• trade union activists.  

Possible consequences: 

Termination of such an employee without fulfilling statutory requirements almost always results in a dispute. As a result, the employer may be required to: 

• reinstate the employee,  

• pay remuneration for the period of unemployment.  

See also:

Employment flexibility – can an employee be exclusive?

Read full article

Failure to consult trade unions 

If trade unions operate within the employer’s organization, failure to carry out the required consultations before issuing a termination notice is a serious procedural breach. 

Importantly, even a well-justified termination may be considered unlawful if the consultation procedure is violated. 

Possible consequences: 

• declaration that the termination violates regulations,  

• compensation or reinstatement,  

• deterioration of relations with trade unions.  

Formal errors in documentation 

Improperly prepared termination documents (e.g., lack of information about the right to appeal to a labour court, incorrect form, wrong dates) may be grounds for challenging the dismissal. 

Most common irregularities: 

Possible consequences: 

• declaration that the termination violates regulations and is therefore ineffective,  

• need to repeat the procedure,  

• risk of employee claims.  

Poorly prepared disciplinary terminations 

Termination without notice (“disciplinary dismissal”) is an exceptional measure and requires stricter conditions than ordinary termination. A frequent mistake is prematurely classifying employee behaviour as a gross violation of basic duties, when objectively it does not meet such criteria or does not do so with sufficient severity. 

Possible consequences: 

• compensation, or  

• reinstatement,  

• loss of trust within the team and negative PR.  

Ignoring reputational risk 

Even a formally correct termination may harm the employer if it is carried out without considering the social context and without proper communication of the reasons. 

Effects

• lower team morale,  

• negative market reputation of the employer,  

• difficulties in recruiting new employees.  

Summary 

An improper employee termination is not only a matter of violating labour law regulations, but also of real financial, operational, and reputational costs. In many cases, litigation costs significantly exceed the cost of legal consultation, which could have prevented a lawsuit or reduced the risk of losing it. 

A well-planned and properly executed termination process allows you to: 

Author of the article – Piotr Kryczek – adds: 
“Before an employer decides to terminate an employee, they should consider whether other measures could be used that would discipline the employee instead of removing them from the organization. Terminating an employee and hiring a replacement may ultimately be much more costly.” 

How does TGC Corporate Lawyers support employers? 

TGC Corporate Lawyers supports employers at every stage of the employee termination process, both in individual and collective dismissals. 

Our services include: 

• legal risk analysis related to planned termination,  

• preparation and review of documents (termination notices, agreements, regulations),  

• support in collective redundancies and restructuring,  

• advice on the protection of special employee groups,  

• representation in labour law disputes,  

• training for HR and management staff.  

Thanks to our practical approach and business experience, we help carry out complex procedures in a legally compliant and safe manner for the organization. 

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