At-Will Employment Simplified

In the previous post we discussed my struggle with creating an at-will employment disclaimer for the staffing manual. It was mentioned that many applicants may not understand the potential benefits and consequences of at will employment and we will pursue this train of thought in this post.

Before we go any further in this discussion, it is important to understand what at-will employment is. In short, at-will employment means that your employer can fire you or ask you to resign at any time, for any reason or no reason, and with or without notice. Conversely as an employee, you can leave your employer at any time for any reason or no reason and with or without notice. You might be thinking, "There's an exception to every rule." If so, then you are correct. There are a few exceptions to at-will employment.

The first exception is called the "public policy exception" which means that an employer cannot fire you if the reason violates state law, or if you refuse to violate state law.

The second exception, "implied contract," means that any policies and written or oral promises that are made by your employer may constitute an employment contract (some call this a "gentleman's contract" or "handshake agreement"). However, many states support disclaimers that are used to invalidate the policies and promises made that guarantee the terms of employment. Also, some states do not automatically assume that the presence of a disclaimer cancels an implied contract and a few states do not recognize implied contracts (with or without a disclaimer). In short, even if your employer has outlined a disciplinary process in its employee handbook or promised you employment for a specific period of time, your employer may not have to follow that process or wait before firing you.

Finally, the "covenant of good faith exception" states that an employer cannot fire an employee in "bad faith." Simply put, this means that your employer cannot fire you for dishonest reasons such as to avoid paying for retirement or severance benefits. However, most states do not recognize this exception.

Hopefully this has helped to better your understanding of the at-will disclaimers that you see on employment applications or in your employee handbook. The next post will demonstrate the importance of understanding these disclaimers before you sign an application or an employee handbook.

Thank you for reading, and warm regards.