An employee gave two weeks notice last week. Now the vice president wants the employee gone as of Friday (1 week into the 2 weeks).
What are our obligations about the other week? Do we have to pay her or does this come under "employment at will"?
I looked into this for my company as well. What I found is that there are only a couple of states that require you to pay if someone gives notice. I can't remember what those states are at the moment, as my state (Maryland) was not one of them.
There are many companies that do pay out the notice as a show of good faith. The person showed good faith by giving you notice, but you choose not to have them on staff for those remaining weeks so you are paying them to get them off your books (so to speak). Remember what you do now is setting the precedence for the future.
You also need to see what your policy say. The other thing you have to consider is what your policy says regarding paying out for unused sick and vacation time.
Keep in mind that whatever you do... other employees are going to hear about it. If you cut someone who gave you two weeks notice loose after only one week, what incentive do other employees have in giving you any notice at all. If I need to keep working in between the transition between jobs and I know you'll let me go if I give you notice, I may just work until my final day with the company and then let you know. You will be left high and dry and haven't even had the opportunity to start a search for a replacement.
I've always been a proponent of just going ahead and paying a person who has let me know they are leaving. It is usually not a big hit on our budget and I may have a critical position I want to keep until the last minute while I look for a replacement. It usually pays for itself.
Why does the VP want the person gone?
Is there a performance or attitude problem brewing with the "short timer"?