The failure to document performance issues can cause trouble for companies facing wrongful termination lawsuits, according to Timothy McCormack, a partner in Ballard Spahr’s Litigation Department. And negative evaluations just months before an employee is fired can be just as damaging.

“Too often, it looks like the evaluation is a cover-up for a discriminatory motive,” Mr. McCormack said. “The reality is, the supervisors, despite favorable evaluations, will say they were unhappy for a long time, yet did not document it. Get your supervisors to buy into the concept of giving employees an opportunity to correct deficiencies. And, if possible, it’s preferable that the employee sign the plan.”