Magic Words: “Employment At Will” and “Termination”

Most employment manuals, offer letters, and policies contain repeated statements that read something like:

“Employment at XYZ Corporation is at will. This means that either party to the employment relationship, both you and XYZ Corporation, may end the relationship at any time, for any reason at all or for no reason at all, with or without notice.”

To paraphrase a line from a classic movie, this claim is “mostly true.”

The law approaches an employment relationship from the basic perspective of a contract. Employer and Employee enter into a contract by which Employee will render services as requested by Employer, in exchange for a given amount of money (and other benefits) paid at a given rate. That might be a wage (as in $25.00 per hour) or a salary (as in $80,000 per year). That’s fine, so far as it goes.

But it turns out things are just a little bit more complicated than that. I spend a lot of time trying to determine what the reason for a termination really was, because the phrase “for any reason” doesn’t really mean “any” reason in the literal sense. To take an obvious example, if XYZ Corporation decides to fire Employee because of the Employee’s race, that’s a bad reason: race discrimination. It turns out, employers who discriminate against employees on the basis of race act contrary to law, and generally in a way that is actionable (meaning “subject to civil suit”).

The most common wrongful reasons for termination are some kind of discrimination or some kind of retaliation for a legally protected activity. While the employer can claim the right to terminate for “any reason at all or for no reason at all,” in truth, the employer lacks the right to terminate for a specific set of prohibited reasons and no amount of attempting to create paperwork or policies or agreements will make that go away.

As for terminations “for no reason at all,” I suppose such a thing might have happened, but I’ve never seen it. The employer generally doesn’t articulate the reason for termination, but there’s always a reason for doing it. Sometimes those reasons are good: the employer has hit hard times and needs to cut payroll to continue surviving; the employee has violated a major policy of the company; the employer is relocating and cannot afford to take the employee with it to the new geographic area; the employee’s job function is no longer needed due to some change in technology or shift in business strategy.

As a general rule, all of these are valid reasons for termination. If they are offered as reasons for the termination but turn out not to be true, however, someone like me is going to want to look a little deeper because if the given reason isn’t true, the employer is probably looking to conceal the true reason.

If the true reason is something that is an error in the employer’s judgment, or a bad business move, or even the outgrowth of office politics based on reasons that aren’t on the “prohibited motives” list, that’s where the “at will” clause is operative. The law generally won’t protect a business from making decisions against its own self-interest, and it generally won’t protect employees of that business from feeling the consequences of those bad decisions, either. So when I hear a recently-fired employee saying “I was a good worker but my supervisor gave me bad performance reviews because she doesn’t like me,” I am interested in why the supervisor doesn’t like the worker to the extent that the supervisor’s reason is or is not on the list of prohibited motives. If not, the way the employee was treated may well have been unfair in a broad sense, but that doesn’t make it legally actionable.

“Law” and “justice” are supposed to be the same thing but, unfortunately, sometimes aren’t.

There’s also the question of notice. A lot of people feel if they want to quit, they have to give the employer two weeks’ notice. It’s often good politics to do that. An employee who leaves without any prior notice affords the employer no chance to re-allocate that employee’s work to keep getting things done, nor any opportunity to go out and hire a replacement. But there’s no legal requirement to give that two weeks’ notice (or more or less time) and if circumstances require a no-notice termination, that’s what happens. I notice that employers rarely tell employees they are terminating “You’ll be out of this job in two weeks.” Indeed, a termination initiated by an employer is usually something that happens all at once.

Again, it might be a good idea to give two weeks’ notice to an employer, but it’s not a legal requirement.

Finally, I occasionally get a phone call from someone who says that they could have handled it if their employer laid them off, but is very upset that they were terminated instead. There are very few cases where the terminology matters to me. The employment relationship has ended. A synonym for “ended” is “terminated.” “Laid off” sometimes is understood to mean “an employer-initiated termination of employment for which the reason is not intended to reflect badly upon the employee.” But it’s still a “termination.” “Quitting” and “resigning” are also “terminations,” just terminations initiated by the employee rather than the employer.

Termination, by itself, isn’t necessarily wrong or actionable, even if it’s a blow to be on the receiving end of one. What makes a termination “wrongful” is a legally prohibited motive. It’s all about “why.”