At-will employment is something most U.S.-based employers are familiar with. But what does this term really mean? Can an employer actually terminate an employee without any reason at all? What are the exceptions?
Defining At-Will Employment
First, let’s start with the definition of “at-will employment.” It does in fact mean that an employer has the right to terminate an employee at any time and for any (or no) reason. It also means that the employee has the right to terminate his or her own employment at any time and for any (or no) reason. There are no predefined legal requirements in terms of notice periods either. This means the termination can be done without any prior notice.
If an employer/employee who is in an at-will employment situation decides to terminate the employment relationship, the other party has no recourse. In the United States, in almost every state (Montana is the exception), an employee is considered to be an at-will employee unless there is proof otherwise, such as an employment contract.
Exceptions to the At-Will Employment Doctrine
Employers need to understand that there are caveats to the above definition. This is because other laws may be broken if a termination is made for an otherwise illegal reason, such as discrimination. Here are some of the exceptions to the at-will employment doctrine:
- An employee cannot be fired for a discriminatory reason. Title VII of the Civil Rights Act, for example, protects employees from discrimination based on race, national origin, religion, color, or sex. For another example, the Americans with Disabilities Act makes it illegal to discriminate against someone because of a disability.
- An employee cannot be fired out of retaliation for performing a legally protected action. For example, an employer cannot fire an employee for filing a workers’ compensation claim. Other retaliation-protected actions include:
- Filing a discrimination or harassment suit
- Being a whistleblower regarding illegal or unsafe practices
- Refusing to perform illegal activities
- Participating in a workplace investigation
- Requesting reasonable accommodation for a disability
- Taking legally protected leave from work, such as FMLA leave
- Discussing (or complaining about) the working environment or wage and overtime practices
- An employee with a contract that outlines the terms of employment cannot be fired outside of those terms. In other words, contracts supersede at-will employment assumptions. Some states also provide protections for implied (unwritten) contracts. Check your local laws.
- An employer who provides some protections in employment policies, such as firing only for just cause, must abide by those protections. In this case, the employer has opted to forgo the at-will option by providing other protections.
As we’ve shown here, terminating an at-will employee is not always as straightforward as it may seem. Employers should also remember that some states have more stringent requirements. Be sure to check state and local laws before making any termination decision.
About Bridget Miller:
Bridget Miller is a business consultant with a specialized MBA in International Economics and Management, which provides a unique perspective on business challenges. She’s been working in the corporate world for over 15 years, with experience across multiple diverse departments including HR, sales, marketing, IT, commercial development, and training.