Reductions in Force -- How to Minimize Liability

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Last month we covered issues relating to furloughs. This month, we focus on reductions in force (RIF), as many companies are either presently undertaking or considering the prospect of conducting layoffs. Unfortunately, many employers are under the erroneous impression that if the reason for the layoff is "economic" or related to the down economy, then the employer is absolved of any liability for claims of discrimination. Such is not the case. In fact, employee terminations as part of a layoff are subject to challenge on the basis of federal, state, and local antidiscrimination laws. Employers must be prepared to set forth legitimate, non-discriminatory reasons for the decisions to select those laid off. Therefore, proper planning is crucial.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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