At-Will Employment Guide: The Benefits and Pitfalls of the At-Will Employment System

In an effort to provide employees greater job protection, legislatures and courts across the country have slowly enacted a number of exceptions and restrictions to the traditional at-will employment system used by most employers.

The traditional conception of at-will employment holds that the employer/employee relationship between two parties can be terminated by either party, at any time, for any reason, with or without prior notification. As a result, at-will employment provides immense flexibility to both parties as the relationship, and any duties or obligations created by the relationship, can be quickly terminated with little to no legal risk.

Although the same flexibility is granted to both parties, the at-will system is generally considered to favor employers over employees, as the cost of losing an employee position is typically more easily borne by the employer than the employee. With the exception of government and unionized employees, most employer/employee relationships fall under the at-will system.

The following are several of the major at-will restrictions:

Implied Contract Doctrine
Not all employment contracts have to be expressed through written agreements. Implied contracts exist when the representations of the employer assure an employee of continued employment. Such representations can be made through employer handbooks, policies, or other types of verbal or written conduct.

Public Policy Doctrine
Under the public policy exception, an employee’s termination can be restricted when it causes harm to a well-established public policy consideration. For example, an employer cannot terminate an employee for filing a worker’s compensation claim after being injured on the job. Similarly, an employee cannot be terminated for refusing to break the law at the request of the employer.

Illegal Discrimination
An employer cannot base employment decisions, including hiring, promoting, or terminating, on an individual’s race, color, national origin, religion, sex, age, disability, or veteran status.

Similar to the public policy exception, federal and state laws prohibit employers from retaliating against an employee for engaging in certain protected activities, including claiming minimum wage or overtime violations, engaging in union activities, opposing unlawful discriminatory practices, filing worker’s compensation, taking leave time allowed under the Family Medical Leave Act, or in some states for “whistleblowing”.

It is crucial for employers to understand these restrictions in order to maintain at-will relationships with its employees and in order to make appropriate termination decisions.

Conversely, it is also crucial that employees understand their rights as an employee so as to protect themselves from illegal or discriminatory workplace actions or terminations.

If you need further assistance in understanding your obligations as an employer, or if you are an employee whose employment rights may have been violated, please contact us.

Scroll to Top