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No Reason at All: The At-Will Employment Relationship

Whitney O’Sullivan

No Reason at All: The At-Will Employment Relationship

“Good reason, bad reason, no reason at all.”

That’s the mantra of the at-will employment relationship. If you are an at-will employee, you can be dismissed at any time for any lawful reason, or for no reason at all. You are also free to quit whenever you want.  While most employers don’t fire people on a whim, the at-will relationship gives them broad freedom to fire without repercussions. So it’s important to understand the ins and outs of at-will employment.

Are you an at-will employee?

Think about all of the paperwork you signed when you started your job. There was probably a lot of it. There was likely an employee handbook for you to review, documents related to benefits, and some sort of letter indicating your salary and title. Do you remember what those document said?

Employers usually spell out very clearly if the relationship is at-will.

Employers usually spell out very clearly if the relationship is at-will. This might be in your offer letter, in the company handbook, or in your employment contract. The employer wants to avoid ambiguity and the possibility that a terminated employee will later claim that the relationship was not at-will and that he or she was improperly let go. 

If you’re not at-will, your new hire documents will probably spell this out too. For example, you might have an employment contract that includes a specific end date or contract term, a 30-day opt out (meaning that either party must give 30-days notice to discontinue work), or an enumerated list of limited reasons for termination. Maybe there is even a damages clause that imposes a penalty if you are terminated for a reason other than the ones given.

Sometimes companies — particularly those that don’t hire very often and therefore don’t have standard hiring paperwork — never clearly spell out your type of employment. In that case it’s up to you, the employee, to dig a bit deeper.

Employer statements and representations can help you understand if you are an at-will employee.

Employer statements and representations can help you understand if you are an at-will employee. Has your company ever told you (in writing or orally) that they only terminate employees for very specific reasons? For example, that termination would only occur if you received a negative review three months in a row, or if your failed to meet a designated quota? If so, and if there is no written policy to the contrary, you may not have an at-will relationship and may need to meet certain criteria in order to be properly terminated.

Limits on Termination

As the mantra states, if you are an at-will employee, you can be terminated for absolutely any reason at all, right? Almost. Even at-will relationships have limits on the reasons a person can be let go.

Even at-will relationships have limits on the reasons a person can be let go.

Certain personal characteristics, known as protected classes, are never acceptable reasons for termination. At the federal level, a person’s race, color, religion, sex (including pregnancy), national origin, age (40 or older), disability or genetic information are all protected classes. Some states have expanded upon the federal protected classes and also prohibit employment decisions made on the basis of sexual orientation, medical conditions (including HIV/AIDS), political affiliations, marital status, and more.

This mean, for example, that a person can’t be let go simply because she’s “too old,” follows a certain religion, or is pregnant.  This isn’t to say that an employer can’t let anyone over 40 or who is pregnant go, only that the reason for termination can’t be related to these characteristics. If a terminated employee were to challenge the decision, the employer would need to prove that age or pregnancy was not involved in the decision.

Given how many protected classes exist, it is always in an employer’s best interest to keep detailed records of employee performance and negative reviews. It is equally important that the employee keep his or her own records. If you are let go and think that the termination violates your non at-will employment, or was because you are a member of a protected class, talk to an attorney immediately — there are time limits on filing a claim.