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Caryn Pass authored an article on the missteps that can trigger lawsuits – and strategies to avoid litigation – when a school makes the decision to right size its staff. The article appeared in the Summer 2009 issue of NAIS Independent School Magazine and can be found as a downloadable file in the left column.

The topic is especially timely as independent schools across the nation face funding shortfalls and shrinking enrollment as a consequence of the economic downturn.

Pass recommends that in order to mitigate the chance of a lawsuit or discrimination claim that schools draft employment agreements, employee handbooks and other documents that govern the employer/employee relationship to ensure that the institution has maximum flexibility to make termination decisions.

Once an institution is contemplating downsizing its staff, it is critical, Pass says, that the first action the school takes is a thorough risk assessment. In doing this, the school should weigh the benefits of taking action (i.e. reduced payroll and bringing on more motivated staff members) against the potential for litigation and community backlash.

Two key components of this assessment, according to Pass, are whether the decision disproportionally impacts individuals in a protected class and whether the decision has been made and prosecuted in accordance with the institution’s culture.

One common pitfall Pass calls out in the piece are “employment at will” clauses. Although many employers believe this language gives them the freedom to terminate employees as will and without having to articulate a reason – which it does - Pass points out that the clause is not a safeguard against employment discrimination suits.