At-Will Employment and Wrongful Termination

When people get fired, they assume they can sue their employer for wrongful termination. They don't realize that they're an at-will employee. You and your employer can end the employment relationship anytime and for any reason.

Generally, an at-will employment relationship means that either party can end the relationship without prior notice and for any reason (or no reason) at all. All U.S. states are at-will employment states except Montana.

At-will employment gives employers free rein to fire employees. However, the wrongful termination exception to at-will employment gives employees some protection.

This article will discuss what it means to be an at-will employee. It will also explain the various exceptions to the at-will relationship rule. Finally, we will briefly describe your options should your employer fire you in bad faith.

What Does It Mean To Be an At-Will Employee?

Being an at-will employee means you and your employer can terminate the employment relationship. You can quit anytime if you are no longer happy at your current job. Your employer cannot penalize you for doing this unless a contract or collective bargaining agreement exists.

Your employer can fire you at any time. Depending on the laws in your state, they may have to provide a just cause for your termination. For example, if your manager isn't happy with your performance, they can fire you. Sometimes, an employer gives no reason other than that you and the company should part ways.

Knowing that your company can terminate employees willy-nilly can be highly frustrating. However, you do have an equal right to quit whenever you want.

What Rights Does an At-Will Employment Relationship Offer Workers?

While it is true that your employer can fire you for almost any reason, you do have some rights as an at-will employee. Most of these are available to you through federal law.

Some of the rights at-will employees have include:

• Federal law protects you from sexual harassment and discrimination based on sexual orientation.
• Your employer cannot fire you for refusing to break the law (whistleblowing).
• You can't be fired for discriminatory reasons if you're a member of a protected class.
• You can still file for workers' compensation, disability, and unemployment.

If you believe your employer violated these rights, immediately contact an employment lawyer. They can review your claim and tell you if it's worth pursuing.

There Are Exceptions to the At-Will Employment Rule

For the most part, you won't find state statutes prohibiting wrongful termination. However, under the common law, wrongful termination includes firings that violate:

• A state's public policy
• An implied contract for employment
• The implied covenant of good faith and fair dealing

Wrongful discharge also includes terminations that violate federal, state, or local anti-discrimination laws.

Below, we describe the common law wrongful termination exceptions to at-will employment.

Public Policy Exception

The public-policy exception is one of the most robust exceptions to at-will employment terminations. This prohibits an employer from firing someone in violation of public policy. The public policy must be explicit and well-established in the state.

According to the Restatement (Second) of Torts, the public policy exception has four categories. These include:

• Employees Exercising a Statutory Right: Imagine you get hurt at work and file a workers' compensation claim. Your employer cannot fire you out of retaliation since your state's workers' compensation laws provide protection. The same applies if you go out on Family Medical Leave Act (FMLA) after having a baby.
• Engaging in Any Act That Supports the Public Interest: When Hurricane Katrina hit, thousands of Americans volunteered in the cleanup. If you engage in this sort of behavior, your employer cannot punish you for it. The same thing applies to serving jury duty. Your employer cannot legally fire you for honoring your civic duty.
• Refusing To Engage in Illegal, Unethical, or Immoral Acts: Your employer can't fire you under the at-will employment rules because you refused to engage in wrongful acts. For example, an employer can't fire their employee for refusing to commit perjury.
• Reporting a Violation of the Law: This is commonly referred to as being a whistleblower. Employers cannot fire workers who speak out against illegal, unethical, or immoral behavior out of retaliation.

Most states recognize the public-policy exception. You can find tenets of public policy in places such as:

• A state constitution
• A statute
• An administrative rule
• Other state policies

If your employment attorney can prove that you meet the public policy exception, you may prevail in your cause of action. You may even be able to recover punitive damages. It depends on the nature and extent of your employer's behavior.

Implied Contract Exception

The second common law exception to at-will employment is the implied contract exception. An implied contract can exist even though no explicit, written employment contract exists.

An implied contract forms when the employer makes certain oral or written representations to the employee regarding job security or disciplinary procedures. There are other things the court will consider when determining if an implied contract exists.

Some of the facts the court will take into account include:

• Information and language provided to the employee at the time of hire
• Policies and procedures regarding discipline and termination
• Oral and written assurances provided by the employer
• Representations your employer has made to you during your relationship
• Employee handbook

More than half the states recognize the implied contract exception.

Covenant of Good Faith Exception

Only a handful of states recognize the covenant of good faith exception. California is one example.

This exception attaches a covenant of good faith and fair dealing to the employment relationship. The covenant prohibits the employer from firing the employee in bad faith. This helps ensure the employee receives the relationship's agreed-upon benefits.

States disagree about when the exception applies and what it requires. An attorney experienced in wrongful termination law can clarify these issues for you.

Sexual Harassment, Employment Discrimination, and Illegal Activity

Certain things are grounds for wrongful termination regardless of whether you're an at-will employee. For example, if you're the victim of sexual harassment, it doesn't matter what type of employee you are. You may have a claim for damages for the harassment itself.

Some of the other grounds on which you can sue for wrongful discharge include:

• Employment Discrimination: This may involve any type of discrimination, including national origin, race, ethnicity, religion, gender, or sexual orientation.
• Illegal Activity: You can also sue for wrongful termination if your employer forces you (or pressures you) to engage in illegal activity. If they fire you for refusing to take part in this behavior, you may have grounds for legal damages.
• Retaliation: If your employer fires you out of revenge, your attorney can sue for damages. For example, if you are out on workers' compensation for several months, your employer can't fire you for your injuries. This doesn't mean your company can't fire you while you're out on workers' compensation. It just means that filing a claim cannot be the reason for your discharge.

Contact an Employment Lawyer To Help With Your Wrongful Termination Lawsuit

Losing your job can be devastating. Whether you've worked for the company for six months or six years, it is a crushing blow. You must understand the basics of employment law so you can protect yourself.

We've discussed at-will employment in detail here. We've also explained the various exceptions to these rules. An experienced labor law attorney can help determine if you have a potential wrongful termination claim against your employer.

Not all state laws recognize the common law exceptions to at-will employment rules. A wrongful termination attorney can help you understand which exceptions your state recognizes. They can also give you legal advice in filing suit under one of the exceptions.