With no contract, you can be fired at will

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Dear Joan:
A lawyer once told me that an employer could fire an employee for any reason whatsoever for no particular reason. He said the only exceptions were employees covered under a union contract or some other kind of written contract.

However, I know of companies (where employees are hired without a contract) that have instituted elaborate procedures for disciplining and firing employees. These procedures include meeting with the employee to discuss problems, documentation of the meetings, placing employees on probation, etc. I've heard that the reason for such procedures is the fear that employers have of being sued by employees for wrongful dismissal.

What is the truth about the circumstances under which an employee can be fired?

Answer:
What you heard about employers being able to fire an employee is basically true. It's called "employment-at-will" and means that if you aren't covered by an employment contract, you can't be forced to stay with an employer and, in turn, an employer can't be forced to keep you employed. In other words, you can quit at any time and your employer can let you go at any time. It has been the unwritten employment contract for decades. (It had its origin in English common law and had begun to gain acceptance in the U.S. by 1877.)

However, during the past twenty years, some state courts have made exceptions to the "at-will" doctrine. These exceptions are designed to protect employees from abuse or unequal treatment by their employers. This opened the door for an onslaught of litigation. In many states, discharged employees can now recover economic losses and get their jobs back by proving: (1) that the employer broke an implied contract of continued employment (such as an implied promise of job security); or (2) that the termination was contrary to public policy (such as dismissal for refusing to violate a law). A few states also include (3) that the termination violated an implied covenant of good faith and fair dealing (meaning the company was unfair).

Management attorney Julie Buchanan specializes in the area of personnel law. She says, "The employment-at-will doctrine has been severely restricted by the many state and federal statues prohibiting discrimination. A discharged employee seldom sues an employer solely on grounds of wrongful discharge. A suit usually includes a host of other allegations such as discrimination based on race, sex or age."

Ex-employees often seek a jury trial by linking a wrongful discharge claim to common law claims such as defamation or invasion of privacy. A hostile jury can send punitive damages into the stratosphere. With the stakes so high, companies are becoming adamant about their managers following "progressive disciplinary procedures."

Progressive discipline began with unions, who asked management to follow an agreed upon process so their represented employees could be assured that they were only fired for "just cause" (a reasonable cause). This process includes the steps you described. The intention is to make sure the manager is objective and straightforward with the employee, so he or she knows exactly what is wrong and why it needs to be corrected.

This kind of process makes sense whether an employee is under a contract or not. And for this reason, many companies have instituted a progressive discipline policy for every employee. And with employee lawsuits on the rise for wrongful termination, employers have found that progressive discipline procedures are a good way to protect themselves in court.

Most companies have a written policy that states any employee can be fired for things such as stealing, fighting, and drug use. Terminations can be fairly straightforward for people with obvious problems such as absenteeism or productivity problems. It gets more difficult to document behavior objectively for employees with problems such as negative attitudes and poor culture fit.

When progressive discipline is followed properly, it avoids some of the common mistakes managers make:

·        The manager didn't accumulate enough objective evidence before taking action.

·        The manager sent mixed signals- such as a history of good performance reviews or merit increases before the person was fired.

·        The employee wasn't told what was expected and how they were failing.

Even though employment-at-will is still the accepted doctrine, the court-imposed exceptions, and a litigious society are causing employers to implement more elaborate policies when it comes to firing employees.

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