Q & A: Employment-At-Will Termination

Q:  Am I required to provide employees with reasons for terminating them? Is it possible for an employee’s “wrongful termination” claim to be valid? I provide “employment-at-will,” and employees do not sign employment contracts.

A: Employers are not always legally required to provide employees with reasons for termination. However, employers should carefully consider adopting a practice of informing employees of the reasons for termination. If done appropriately, providing reasons may reduce the number of lawsuits filed by disgruntled former employees. Before terminating an employee consider:

  • Notifying the employee of why he or she is being terminated
  • Providing the employee with the opportunity to explain or defend his or her actions

You may want to conduct an exit interview to do these things. Exit interviews not only allow you to touch base with terminated employees prior to their departure, but they may also provide you with valuable information on the situation that caused the termination, on whether or not the employee intends to sue you and on what the employee’s future plans for employment are. Remember to always treat employees in a respectful and professional manner. This can make the difference in whether or not a claim is filed.

Moreover, employees can establish valid claims for wrongful termination even when the employment relationship was at-will. This is possible because the employment-at-will relationship is a presumption that can be overcome by governmental regulation or even by implied contracts.

Governmental regulation overcomes the employment-at-will presumption by prohibiting employers from engaging in conduct that would discriminate against protected groups. Also, federal law prohibits an employer from terminating an employee for the purpose of preventing him or her from qualifying for a pension or similar benefit. Employers should take care when terminating employees who are members of protected groups. Documenting permissible reasons for termination that are not discriminatory can help employers that may be subject to employee claims.

In addition, several courts have recognized the existence of an implied employment contract where an employer has created employment expectations with his or her personnel. For example, an employer that has set an expectation of progressive discipline or of terminating employees only for just cause may have waived its right to dismiss an employee under the at-will presumption.

 

DISCLOSURE

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The information provided is for informational purposes only and does not constitute legal advice. The information above contains only a summary of the applicable legal provisions and does not purport to cover every aspect of any particular law, regulation or requirement. Depending on the specific facts of any situation, there may be additional or different requirements. This is to be used only as a guide and not as a definitive description of your compliance obligations.