While terminating employees is one of the more unpleasant tasks that owners and managers have to carry out, it is a necessary part of business. Mistakes committed during the firing process can come back to haunt you by way of legal action, if you're not careful. Here are 10 common mistakes made in the termination process:

1. Failing to have a signed employment agreement or offer letter with each employee. It's always to your advantage to have an agreement that essentially states that the employee understands the hiring terms and the "at-will" nature of employment, meaning either the employer or the employee can terminate employment at any time.
2. Not having standard policies in writing. Whether it's in the form of an official handbook or several pages stapled together, you should have clear policies in place so that employees know exactly what is and is not expected of them while employed.
3. Not having proper appraisal documentation. If someone is performing poorly or there is any indication that you may need to terminate an employee, you should keep records of warnings or discussions regarding poor performance or failure to abide by company policies. You will want documentation in the event the employee takes legal action after being terminated.
4. Not having a legitimate job-related reason. In many states you do not have to provide a reason for firing someone. However, whether you tell the employee or not, you should always have a legitimate reason for terminating an employee if you do not want to get hit with a discrimination lawsuit.
5. Failing to prepare for termination. Know what you're going to say, and have all paperwork prepared ahead of time. If there is severance pay or anything else owed to the employee, such as vacation pay, you should have a check cut to give the employee. In addition, you need to be knowledgeable about state and company policies. If you are unsure, read up on them in advance, or even call the state unemployment office for clarification.
6. Taking too long. If you are planning to terminate someone and continue to wait for the right time, you can run into several problems. First, the employee may get wind of the situation and become disruptive, slack off completely, or begin to set up a lawsuit situation. Second, other people in the department may become aware that something is up, and morale will drop quickly. If the decision has been made, act promptly.
7. Not having a follow-up plan. Terminating someone may be the best way to solve a problem, but there remains a need to have the work completed. You should be prepared to address your next course of action, which may be dividing the work among other employees, hiring someone new, or outsourcing the work.
8. Talking too much. Too often employers talk too much and say the wrong thing. Don't make promises you can't keep, such as to help the employee find another job. Don't make excuses or pass the blame. Keep the conversation to a few minutes, and stick to the matter at hand. There's nothing wrong with saying that you are sorry, but be careful regarding anything else you say.
9. Letting the word out. A slip of the tongue can be a big mistake. Nobody else should know about the impending termination except those involved in the decision process. The individual being terminated deserves to be treated with respect and dignity, and not be embarrassed because everyone in the company knows he or she is being terminated.
10. Arguing. A common mistake is getting into an argument with the employee being terminated. You should not let this happen. If he or she is angry, let them vent. You can only lose if you start arguing back.

For more information, check out the Termination section of AllBusiness.com's Human Resources Center.