What is at-will employment?
Almost everyone will leave a job at some point in their career. Whether the decision is made by the business, or comes from the employee, the employment relationship typically can end at anytime and for any reason. Let’s take a look at what at-will employment is.
What is at-will employment?
Do you think an employee is underperforming in their role? It is within your right to terminate them. Maybe an employee does not feel comfortable in a job they just started at a new company. It is within their right to leave on their own will. The at-will employment agreement allows this. At-will employment means that the employer or employee can end the relationship for almost any reason. This relationship can end with or without cause or reason.
Every state, except Montana, assumes the employment relationship is at-will unless there is a legal agreement in place that says otherwise. It is important to use clear language that establishes your business uses at-will employment in your company handbook.
What should employers know about at-will employment?
Keep in mind that terminations always carry a bit of risk because they can occur for almost any reason. There are illegal reasons, such as being discriminated against, that protect employees from termination. An employer cannot terminate an employee solely on their:
- Age
- Gender
- Being pregnant
- Having a disability
- Other protected classes
Additionally, employers must not terminate on the basis of retaliation or whistleblowing. It is important for business owners and HR managers to know these illegal reasons and not base their decisions solely on them.
How employers can protect themselves
There are a few important factors for employers to protect themselves. First, make sure your company handbook clearly defines that employment within your company is on an at-will basis. Secondly, make sure to have proper documentation when terminating an employee for any reason. Keep proper notes of previous performance reviews and disciplinary actions. If an employee tries to pursue legal action for wrongful termination, this documentation of the business reasons for termination will be key.
Finally, consistency is very important. For example, employee A and B have both received a verbal and written warning. Both employee A and employee B receive another written warning, but only employee A is terminated. In this case, employee A could seek legal action for discrimination against your business. Having a standard procedure for disciplinary action and terminations helps maintain consistency across your organization.