This article explains Employment At Will and the eroding of Employment At Will resulting from employee lawsuits and the carelessness of employers. It will also give business owners and human resource professionals tips to help maintain Employment At Will in their workplaces.
The definition of Employment At Will is succinct: “the ability to hire and fire employees for any reason or for no reason at all.” No justification is required. Employment can end at any time.
Sounds easy, doesn’t it? Not so fast!
Employers need to be aware of crucial exceptions in the law that curtail management’s ability to hire and fire employees for any reason, or no reason at all. Ignoring these exceptions invites employee lawsuits and government complaints against you and your company.
Exception One: Civil Rights Legislation. You cannot terminate an employee’s employment because of race, age, disability, national origin or any other lawfully protected class based on such characteristics.
Business owners and managers must keep in mind that state law is just as important as Federal law in the curbing of the traditional Employment At Will definition. For example, California prohibits discrimination based on gender identity or sexual orientation. Florida prohibits discrimination based on being a member of the National Guard. Oregon prohibits employment discrimination based on marital status. At least 20 states have prohibitions against employment decisions based on criteria not protected under Federal law.
Exception Two: Implied Contract. This exception comes out of lawsuits filed by employees against their former employers. State courts have originated the “implied contract” theory to specifically water down Employment At Will. The exception is based entirely on the employer’s behavior towards employees. The employer has not protected its right to Employment At Will, or the employer has acted in a way that is contrary to having Employment At Will. As a result, an “implied contract” exists with the employee; employment cannot be terminated except for good cause.
Here’s how it happens.
The Employer receives an Employment Application from a candidate, and interviews the candidate. The hiring process moves along and a “probationary period” of 60-90 days is explained by the employer. The candidate is hired, and given an employee handbook that contains policies on performance evaluation and progressive discipline, and does not mention Employment At Will. Periodically, the employee has his or her performance evaluated and receives glowing evaluations. The employee is complimented on his/her performance, and assured that as long as the employee performs satisfactorily, the employee will remain with the company; sometimes with the admonition that continued good evaluations are the road to advancement in the organization.
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