What Is At-Will Employment (Explained: All You Need To Know)

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What Is At-Will Employment

At-will employment is a term used in the United States to refer to employment contracts that can be terminated “at will”.

In other words, employees that are hired under an at-will employment contract can be terminated or fired by their employer for any reason.

This means that employers can terminate an employment contract for good cause or without having any cause whatsoever.

Most states in the United States are considered at-will employment states where employment contracts are presumed to be “at-will” unless proven otherwise.

Montana is a rare state where employees that have completed their probationary period are protected from being terminated without good cause.

Typically, employers ensure that their employment contract uses clear terms and conditions stating that the employment is “at-will”.

Also, the employee handbooks and company policies will also reiterate the same point to ensure that the presumption that the employment is at-will is not overturned.

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How To Determine At-Will Employment

There are several ways you can tell whether or not your employment contract is at-will or not.

However, it’s important to mention that most states presume that the employment contract is “at-will” but this presumption can be rebutted with evidence.

The first document that you must consult to see if you are an “at-will” employee is your employment contract.

In many cases, the employment contract is drafted in clear terms where the employee is considered to be “at-will”.

The contract does not need to use the actual words “at-will” but can be drafted in such a way as to indicate the employer can terminate the employee for any reason (good or bad).

Another document that can be consulted is the company’s employee handbook and internal policies.

If the employer addresses topics like how employees can be terminated, what grounds can justify termination, or what type of rights the employer may exercise, you can tell if the employer is looking to have an at-will relationship or not.

For instance, if the employee handbook says that employees can only be terminated for theft, criminal conduct, or specific reasons, then the at-will presumption may potentially be set aside by the court.

Another way you can tell what relationship you have is to assess your employer’s communications and statements.

If the employer regularly states that employees will only be terminated if they do not meet their performance objectives, then the presumption may be set aside with such declarations.

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Advantages of At-Will Employment

At-will employment will have pros and cons that you should consider.

The main advantage for employers is that they can terminate at-will employees quickly and in a more expeditious way.

Generally, employers that are looking to terminate an employee may need to spend a lot of time, energy, and resources in carrying out the termination.

This can take time and lots of energy.

On the other hand, at-will employment contracts can be terminated quickly as the employer does not provide the employee with any termination grounds in advance.

Another important advantage of at-will employment is that employers can adjust their headcount and workforce needs quickly as market demands shift.

Companies can therefore eliminate redundant positions or streamline their operations without carrying the burden of having to extensively deal with their human resources.

Another key benefit is that since employees can be terminated at the employer’s discretion, this will inherently promote productivity.

As a result, employees will need to be productive and do their job well to remain onboard.

Even senior employees will need to remain productive and drive value to the business.

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Disadvantages of At-Will Employment

Although there are several advantages to hiring employees at will, there are also certain disadvantages to consider.

When companies adopt an at-will employment strategy, an important challenge they will face is that employees can quit without notice.

Businesses need to ensure that their business operations run smoothly and without interruption.

As a result, if employees suddenly quit, employers will be in a difficult position.

Another important drawback is that talented employees will generally avoid working in companies where they can be terminated at will.

There are many employees that are looking to find a job where they have stability and job security.

As a result, the idea of “at-will” conflicts with what they are looking for.

Another disadvantage of at-will employment relationships is that employees will potentially learn to hide information or conceal negative things that may put their job or that of their colleagues at risk.

In other words, employers will have to implement different measures to ensure they get accurate and reliable information about their workforce.

Otherwise, employers may only hear about things that employees are willing to report.

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At-Will Employment Termination

Fundamentally, at-will employment contracts allow the parties to terminate the agreement at their discretion.

Employers can therefore terminate an employee without necessarily having a good cause.

However, although at-will employment contracts can be terminated with or without cause, employers cannot terminate such contracts for reasons that are prohibited by law.

The federal government and the states may have statutes that prohibit employers from terminating employees for different reasons.

For example, an employee terminated for discriminatory reasons may have recourses against their employer.

Discriminatory reasons can include race, religion, gender, and other reasons.

Also, employees cannot be terminated by their employer if they have complained about the employer’s illegal activity or some workplace violation.

Workplace law violations can include health and safety measures, harassment, discrimination, or other illegal activities.

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Employment At Will FAQ

What does at will employment mean?

At will employment is a type of employment contract where the employer and the employee can terminate it without having a termination ground.

This means that employers can terminate their employees without cause and employees can quit their job without a reason.

What are the exceptions to at will employment?

Most states presume that an employment contract is “at-will” unless it is proven otherwise.

The exceptions are:

• If the employment contract stipulates how the employee can be terminated and on what grounds
• Employees who are under a collective bargaining agreement
• If there’s an implied contract, such as an employee handbook or hiring policy that states employees can only be terminated for just cause or are not at-will
• If the employee is being terminated in violation of public policy
• If the employer breaches the covenant of good faith and fair dealing

Can at-will employees be fired without notice?

Technically, at-will employees can be terminated at any time.

However, most companies that wish to maintain a good reputation in the market will implement policies and practices where employees are notified in advance so they can start looking for another job.

Employers may also place employees on a performance improvement plan as a means of signaling that the employee is not performing well and may be terminated soon.

What are an at will employee’s rights?

Although employees under an at-will employment contract have fewer protections than unionized employees, they still benefit from certain federal or state employee rights.

At-will employees who lose their job can apply for unemployment insurance and get unemployment benefits until they find a new job.

Also, at-will employees cannot be terminated in violation of anti-discrimination laws, in violation of public policy, or when reporting illegal activity or conduct.

Takeaways 

So there you have it folks!

What does at-will employment mean?

In a nutshell, at-will employment is a type of employment agreement where a person is hired for an indefinite period of time but can be terminated by the employee or employer at any time (at will).

The idea of at will employment is that both the employer and employee can terminate their employment contract at their discretion.

This means that employers can terminate employees without having a cause or having to justify the termination grounds.

This type of employment relationship is recognized in all states in the United States, except for Montana.

If you are negotiating an employment contract or have questions, be sure to ask a qualified employment attorney or professional for guidance.

Now that you know what at will employment means and how it works, good luck with your research!

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