Heather Bussing is a California attorney who has represented employers, unions and employees in every aspect of employment and labor law including contract negotiations, discrimination and wage hour issues. While the courtroom is a place she’s very familiar with, her preferred approach to employment law is to prevent problems. Full bio…
Why At-Will Employment Isn’t
by Heather Bussing
An employer gave a year-long maternity leave and guaranteed the job when mom was ready to return– for the first nine kids. But after the tenth, the company figured it didn’t have to hold the position because of its business needs and because the employment was at-will. So it hired someone else and regretfully told the employee she no longer had a job.
Mom sued because the employer had promised she could return to her position and they had let her do it nine times before. The New Jersey court found there was a contract and that the employer’s at-will policy did not apply in this situation. Eric B. Meyer and Nan Sato have a great discussion of the case, Lapidoth v. Telcordia Technologies, Inc., in the Employer Handbook.
The reality is that at-will does not apply to everything about the employment relationship. At-will only applies to how long the employee is employed, and sometimes that the employee can be fired without a specific reason.
Kinds of Employment
There are three basic flavors of employment: statutory, contractual and at-will.
Statutory: Laws, instead of policies, govern people who work for the state and the federal governments. In many states, this includes public school teachers. State and Federal employees usually have probationary periods, for-cause termination and complex schemes of administrative remedies when employment disputes come up.
Contract: On the far end of the contract spectrum are independent contractors who are not employees at all. Then there are union employees where the union and employer negotiate a contract that covers nearly all aspects of the employment relationship.
In non-union companies, employers generally contract with individuals or groups of employees about some parts of the employment like how much they are paid or how much vacation time they get. In addition, employer policies are considered a contract because both the employer and the employee agree to the policies as part of the employment.
At-will: Most states have laws that say unless the employment is for a specified term, it is at-will. At-will employment also means that the employment can be terminated without “good cause”. Lawyers and courts like to say this means, “either party may terminate the relationship at any time for any or no reason.” That’s pretty much bullshit. An employee can quit anytime because they feel like it. But all sorts of things tie the employer’s hands—like discrimination, family leave and military leave laws. And employment policies.
So there really is no such thing as “at-will” employment except for how long the employee decides to stay. From the employer’s perspective, the employment relationship is really a blend of statutory, contract/policy and circumstance.
Policies That Undermine At-Will Employment
When problems arise, the first thing the employer does is point to the employee’s signature acknowledging that her employment is at-will and she has received the policy manual. The manual is full of repeated and varied statements that the employer can fire the employee for anything, at any time.
Except the policy manual usually has at least two policies that are completely contrary to the idea that the employment can be terminated at any time with or without cause.
1. Probationary Periods. If you want to be able to fire employees who don’t work out, why would you give them 90 days to completely screw things up? Have you considered how much damage a bad employee can do in 3 months? So, along with the 90-day probationary period, there is some statement that the employee can be terminated sooner if the employer, in its sole discretion, thinks it’s a good idea. Oh great. Now the employer has to give a reason for terminating the employee sooner than 90 days, which means that paperwork must be generated, files must be kept and decisions must be justified to management and legal. What started out as a bookmark for evaluating the situation after 90 days, just became a legal obligation to keep the employee for 3 months unless there is a good reason not to.
Get rid of probationary periods and just tell the person it’s not working out as soon as you know it’s not working out. Please. It will be better for everyone in the long run.
2. Progressive Discipline. This is where you get a verbal warning, then a written warning, then edicts are issued, then the hall monitor checks your daily pass, then you are referred to the appropriate scary person, then you are suspended, then there is a grievance and appeal process, then you check yourself into rehab to avoid being fired while everyone involved wishes they could go with you. This is not termination at anytime for any reason. This is a contractual procedure that both the employee and the employer have to suffer through. (There are usually the so-bad-its-obvious provisions, but those never turn into lawsuits because they are also the employee’s “F-You” on the way out the door.)
What percentage of employees who are regularly messing up improve and thrive because of a progressive discipline process? Okay, there are always the codependents and the masochists. But the rest either find it demeaning or figure out better ways to hide their mistakes. Give it up.
Get rid of progressive discipline policies. They interfere with managers’ ability to make prompt and effective decisions. And they force everyone through a process that costs time and money and has little or no benefit. Instead, require managers to pay attention, give constructive criticism, encouragement and praise.
If a company wants the benefits of at-will employment—the flexibility to make prompt discipline and termination decisions without a lot of paperwork and procedure—then eliminate policies that interfere with those goals. And don’t make promises, no matter how well intentioned, that obligate the company to provide continued employment.
If you’re freaking out because your policy manual is down to EEO statements, leave & benefits, and how to find the bathroom, here’s a provision you can add. Require all managers to say “thank you” at least 20 times a day.
