HR Blog

At Will Employment

10/01/2017 | Dee Yingst

Can "grounds" for termination be "just because?" Under the doctrine of at-will employment: Yes (well, maybe).

So we're going to talk about the doctrine of at-will employment. First let's be clear that we're only talking about privatesector (non-government) employees who a) do not have an employment agreement or b) whose employment is not subject to the terms of a collective bargaining agreement.

In its simplest form, the at-will doctrine means an employer can terminate an employee for any reason or no reason at all (and employees are free to do the same).  Often you'll see a notice of at-will employment on an employment application or in an employee handbook that will look something like this:

Employment with the Company is at-will, which means that either the Company or you may terminate the employment relationship at any time, with or without notice or cause, so long as there is no violation of applicable federal or state law.  Modification to the at-will nature of the employment relationship can only be made in writing and signed by our company President.

So essentially, either the company or the employee can end the employment relationship "just because." Remember that news story several years ago when an employee in a dentist's office was terminated and the reason given was that she was deemed "too attractive"? Yep, that's legal (it's not very nice but legal nevertheless).

Now before anyone gets too excited, this does not mean that employers can just willy-nilly start firing workers. It doesn't work that way. Remember I told you last year that there's always a "however" when it comes to regulations??? Well, this is another one of those times.

Did you notice the second half the sentence in the at-will statement: "so long as there is no violation of applicable federal or state law"? There's your "except."

So while there's doesn't have to be a particularly good reason to terminate an employee, there cannot be a discriminatory one.

Just as a quick refresher, you'll want to read over Title VII of the Civil Rights Act and check your state's rules (and in some cases rules in your particular municipality) to determine whether there are additional protected classes not included in the federal law. For instance, here in Pennsylvania, it is unlawful discrimination to make an employment decision based on an employee having a GED instead of a high school diploma.  If you're not sure what applies in your area – find out. You'll be glad you did.

There are three other exceptions to the at-will doctrine:

  1. Public policy exception: an employee cannot be lawfully terminated against a well-established policy of the State. For instance, it is not lawful to terminate an employee because he/she filed a Workers' Compensation claim.
  2. Implied contract exception: when an employer makes oral or written representations about job security or procedures that will be followed when adverse employment actions are taken.  This exception is very important when outlining your Code of Conduct in your handbook. If you have a long-drawn out policy of specific actions taken for breaches of conduct, you could be putting yourself at risk.
  3. Covenant of good-faith exception: this one is pretty broad and as such is not as common as the other two (as of this writing, only 20 states recognize this exception).  This exception applies a standard that more-or-less says that terminations made in "bad faith or motivated by malice are prohibited."

Not all states recognize each exception. Fortunately for us, The National Conference of State Legislatures keeps track.

So just make sure if you think it's time to "release an employee to pursue other opportunities" that the decision makes sense. You don't necessarily need a good reason to terminate employment, but you can't have a bad reason that violates the law.