Unless your employees are all covered by employment contracts or union agreements, your California business employs at-will employees.  Generally, “at will” means employment can be terminated for any reason or no reason, but that’s not exactly true.  There are a few “wrong” reasons in California where terminating an at-will employee can lead to big trouble.

At-will employment really means that an employee is hired for an unspecified time period and without a contractual relationship with the employer.  Either party can terminate employment for (just about) any reason at any time, with or without notice.  The reason doesn’t have to be earth-shattering—employees can be lawfully terminated if their employer doesn’t like their attitude or clothing choices.  So as a business manager, you may be tempted with a trigger finger if your at-will employees can be terminated for any reason, right?  Be careful—here’s where those “wrong” reasons come into play.

Perhaps most obviously, you cannot terminate an at-will employee based on a legally protected status.  Protected statuses in California include race, color, national origin, religion, sex (including pregnancy), age (over 40), disability, and genetic information.   The company must
reasonably accommodate disabilities, religious beliefs, and nursing mothers.  At-will employees may also not be terminated for engaging in legally protected activities, such as filing a workers’ compensation claim, whistleblowing, participating in union activity, or refusing to engage in unlawful behaviors (such as cooking the books).

If an employee alleges discrimination or wrongful termination based on one of these protected categories, you should be prepared with solid documentation to prove otherwise. Keep regular, objective documentation that tracks employee performance, attendance, and conduct, particularly if a known issue develops.  Be sure to give employees copies of all of their performance-related documentation, including any disciplinary actions, and make sure to get a signed acknowledgement of receipt.

You’ll also want to make sure you haven’t created an implied contractual relationship over the course of employment—because remember, employees covered by employment contracts are no longer considered “at will.”  Start by looking over your written employment documentation.  Offer letters should state that employment is at will and can be terminated at any time.  The language in your employee handbook, a common culprit in implied contracts, should be flexible and use terms such as “may” and “at the company’s discretion” to give the company leeway in discipline and termination matters.  Avoid clauses that imply employees will only be disciplined or terminated for specific reasons.  Also be sure to state that the handbook does not create an employment contract.  Then examine your verbal practices.  At no time should supervisors or hiring managers reference job security or imply that employment will continue for a specified period of time, whether indefinitely or as long as the employee’s performance is satisfactory.

Need help keeping up with the ever-changing employment relationship?  Then give the friendly professionals at YES! Your Human Resources Solution a call.  As Orange County’s premier HR consulting firm, we’ll review your Human Resources policies for compliance and help you integrate best practices.  We’ll examine your employee handbook for critical clauses, written in the most clear and effective
language.  We’ll also craft any necessary training to keep your leadership team at the top of their game regarding employee interaction, performance reviews, and documenting potential incidents.  Discover the power of saying YES!  Visit our website or contact us for a free consultation.