3 payroll steps to reduce likelihood of employee lawsuits

CPA unveils steps every organization should take when it comes to terminations
|payroll-reporter.com|Last Updated: 05/26/2014

The Canadian Payroll Association (CPA) has unveiled three basic payroll-related steps every organization should take to reduce the likelihood a terminated employee will sue an employer.

1. Have a termination policy: A clear termination policy should be included with all offer of employment letters, the CPA said. Even better, organizations should adopt current best practices and create a termination policy document that is accessible to employees at any time.

A poll conducted during a CPA webinar in 2014 found one-quarter of the 160 participants don’t have a termination policy in place.

“This is a significant gap in safeguarding against termination challenges and one that would be relatively easy for organizations to close,” the CPA said.

2. Develop a terminations checklist: A checklist is one of the simplest tools for helping organizations implement a standard process, it said.

The CPA has a sample checklist, available for free, at http://www.payroll.ca/cpadocs/Resources/Sample_Termination_Checklist_English.pdf.

3. Ensure the Record of Employment (ROE) is accurate: ROEs must be filed accurately and on time, the CPA said.

Paper ROEs must be filed within five calendar days from the interruption of earnings. But employers can also choose to file the ROE electronically within five calendar days after the end of the pay period.

Filing ROEs electronically is a best practice, said the CPA, reducing employer costs, improving the accuracy of the data and speeding up EI claims for recipients.

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