How to Fire a Board Member
A California board member may be asked to step down for any number of reasons, ranging from conflict of interest to unethical behavior. If you and the rest of the members of your board feel that a member no longer benefits the company or corporation, you must take actions to remove that board member before he or she causes any more damage to the organization. However, doing so is never as easy as it sounds. Removing a board member requires careful consideration and a strategic approach. In removing a board member, you must also make sure that you adhere to corporate bylaws so that the member being removed has no grounds on which to sue the company. At Garcia & Gurney, ALC, our Pleasanton business attorneys can assist you in the removal of a board member and make sure that in doing so, you remain in compliance with company policies and state laws.
Approaches to Removing a Board Member
If you must remove a board member, the best way to do so is to ask that person to leave on his or her own terms. Typically, this saves a lot of time and hassle. However, if that approach does not work, try the following:
Removal by Leave of Absence
Sometimes, a board member’s poor performance, bad attitude, or overall inability to benefit the company stems from a personal issue. If this is the case, you may not need to remove the board member for good; rather, encourage them to take a leave of absence. This leave should be temporary, and allow them to stabilize their circumstances before they return.
To prepare for the leave of absence of one or more board members, review your corporate bylaws and make sure that they include provisions regarding members on leave. These bylaws should clearly outline the powers, abilities, and voting rights of board members on temporary leave.
Removal by Impeachment
Impeachment should be a last resort, and should only be resorted to if the board member in question committed a dire offense. When a board agrees to impeach a member, they essentially vote to dismiss the transgressing member from the board. If you do decide to impeach a member, review the bylaws and ensure that they clearly state the reasons that constitute removal by impeachment, as well as the process by which it should occur. Additionally, it would not be wise to impeach a board member without first recording incidents that happened and steps that were taken to address the situation prior to making the final decision to remove the member.
Consult with a Pleasanton Business Attorney
At Garcia & Gurney, ALC, our Pleasanton business attorneys help California employers strategize the best ways to keep board members from becoming disruptive. We also help employers put in place bylaws and policies that ensure that if a member does become troublesome, the situation can be legally remedied before the member becomes harmful to the organization as a whole. To protect your California corporation from harmful board members, call 925-468-0400, or contact us online.