Employment Law Basics

Employment at Will

Employment at Will:

One of the most important legal concepts for both employers and employees to understand is the doctrine of employment at will.   Most employees in today’s workforce are considered employees at will, which means that either the employee or the employer may end the relationship at any time, with or without notice or cause.  The idea is that employees should be free to move from employer to employer and likewise, employers should be free to terminate employees for any reason or no reason as the employer may deem necessary or appropriate under the circumstances.  The doctrine of employment at will generally applies to most employment relationships, except in the situations noted.  There may also be some state law differences in how the doctrine of employment at will is applied.  However, in general, this is a basic overview of how this concept in the law is applied to most employment relationships.

Exceptions to the General Rule of Employment at Will:

Although the doctrine of employment at will as described above applies in most employment relationships, there are some important exceptions to that general rule. These exceptions are described below and represent situations where an employer is not necessarily free to terminate an employee, if the motivating reason for the employee’s termination is based upon one of the concepts noted below.

  1. Discrimination based on a legally protected status: It is unlawful for an employer to terminate an employee based upon the employee’s status in a protected group, such as the employee’s gender, race, religion, creed, color, disability, national origin or age (if over age 40).  This legal prohibition is based upon state and federal laws which make it illegal to discriminate against employees based upon the employee’s protected status in the categories noted above.  In addition, in some states, it is also unlawful to discriminate against an employee based upon the employee’s gender identity, sexual orientation or transgender status.  It is also impermissible to terminate an employee in retaliation for the employee having raised either an internal or external complaint about discriminatory treatment.  Thus, if an employer’s chief reason for termination or other employment action is based upon the employee’s status in one of the protected categories noted above, that action would constitute an exception to the doctrine of employment at will and a situation where the employer is not free to terminate the employee based upon the employee’s protected status.

Public Policy Exception:

Another exception to the idea that an employer can terminate an employee at any time or for any reason or no reason is what is known in the law as the public policy exception to the doctrine of employment at will.  This applies when a clearly defined and well recognized public policy protects the activity that the employee is engaged in, and the purpose behind the public policy in question would be undermined by the employee’s discharge.  If the employee’s protected activity was the reason that the employee was discharged, and the employer had no overriding business justification for the discharge, then the termination may be unlawful based upon the public policy exception.  Examples of the public policy exception in practice include when an employer terminates an employee for exercising the right to file a workers compensation claim, when an employee refuses to participate in illegal activity, when an employee reports illegal activity and when an employee files a complaint with OSHA concerning workplace safety.  The underlying reason behind this legal protection for employees is that as a policy matter, it is good to encourage employees to exercise their legal rights and/or report legitimate concerns that may come to light to protect the public interest which is served by the policies in question.  Thus, the legal system protects employees engaging in these types of behavior.  There may be some slight state law differences in how this applies because each state has its own defined public policies.  However, the examples given are fairly consistent from state to state in terms of the kinds of things that would qualify for protected activity under the public policy exception.

Contract Employees/Collective Bargaining:

Another important exception to the doctrine of employment at will is in situations where an employee has a written contract of employment in place.  In cases where an employee has an employment contract, the terms and conditions of that contract will govern when an employee can be terminated.  This typically would mean that the contract is for a specific period of time and that termination may only occur under specific circumstances.  Employment contracts also typically require a specific process for termination, and also, a particular amount of notice as well.  Thus, these situations are quite different from the usual employment at will employment relationship. 

An additional exception to the employment at will doctrine is in the case of employees who are subject to a collective bargaining agreement.  This is the situation where there is a union or collective bargaining unit in a particular workplace that has negotiated an employment agreement on behalf of the union members. Most collective bargaining contracts provide that employees can only be terminated for cause.  In addition, such contracts also normally provide that for termination to be initiated, employees must first receive a written warning or what is known as progressive discipline, which follows a series of disciplinary actions before termination can occur.  Thus, in these cases, it is typically not the case that an employer can move directly to termination of employment, except in the most egregious cases of employee misconduct. 

Conclusion

In the world of employment law, it is very important for both employers and employees to understand the basic nature of the employment at will relationship.  As noted above, there are many important exceptions that apply to the basic doctrine of employment at will.  Understanding the nature of these exceptions can assist both employer and employee in successfully navigating employment relationships. 

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