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At-will states refer to jurisdictions within the US where employment is presumed to be voluntary and indefinite for both the employer and the employee. This means that either party can terminate the employment relationship at any time, for any reason that is not prohibited by law, without the need to provide advance notice or justification. This arrangement is prevalent in many U.S. states, where no formal contract exists between the employer and employee specifying the duration of employment or the conditions for termination.

Employment Practices in At-will States

In the United States, all states are formally recognized as at-will employment states. However, many states place limitations on at-will employment, which is in addition to the federal laws that apply to all states. The basic exceptions that several states make available concern an exception due to public policy, implied contracts, as well as a covenant of good faith. At-will employment is the default employment model in 49 out of 50 states in the U.S.

Knowledge Tip: Here are the templates for a better understanding of the format of At-will contracts in the USA:

At-will States with Exemptions

Most states (Florida, Georgia, Louisiana, and Rhode Island being the exceptions) have some form of exemption that prevents employers from firing employees who refuse to disobey a law if the employer had otherwise led the employee to believe their job was safe, or if the employer implied that the employee could only be fired for “just cause”.

Public Policy Exemptions

Public policy exemptions prevent employers from firing employees for doing things that are their legal right or obligation to do.

Some examples include:

  • Following a local or state law the company was asking them to break.
  • Performing jury duty.
  • Filing a worker’s compensation claim after being injured at their job.

All but eight states hold this exemption:

  • Florida
  • Alabama
  • Georgia
  • Louisiana
  • Maine
  • Nebraska
  • New York
  • Rhode Island

Covenant of Good Faith (Exemption)

Covenants of good faith require employers to act in good faith toward their employees. For example, they can’t give an employee good performance reviews that lead them to believe their job is secure one day and then fire them the next without a good reason.

Here are a few more examples of things employers can’t do under this exemption without giving just cause:

  • Firing an employee just before they were due to receive a large pay increase or bonus
  • Firing an employee just before they retired to avoid paying their pension
  • Firing an employee just before the company was to pay them a promised tuition reimbursement
  • Lying about why they fired an employee

Only six states don’t follow this exemption:

  • Florida
  • Georgia
  • Louisiana
  • Maine
  • New York
  • Rhode Island

Exceptions to Just Cause

There are some exceptions to the just cause rule in Montana.

These exceptions include:

  • Employees who are still in their probationary period
  • Employees who are employed on a temporary or seasonal basis
  • Employees who are employed on a project basis
  • Employees who are employed on a casual basis

Implied Contract Exception

Under the implied contract exception, employers can’t fire employees without cause when they’ve stated or implied that they wouldn’t be fired without cause. This applies even if the employee signs a contract saying they understand their employment is at will. Implied contracts often come from employee handbooks or verbal assurances to employees. This is the only at-will exemption Maine and New York have. This is the least popular at-will exemption, as thirteen states don’t apply it:

  • Delaware
  • Florida
  • Georgia
  • Indiana
  • Louisiana
  • Massachusetts
  • Missouri
  • Montana
  • North Carolina
  • Pennsylvania
  • Rhode Island
  • Texas
  • Virginia
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States that Follow At-will Employment

California

In California, the relationship between employer and employee is generally “at-will.” This means that, without an employment contract, the employer or the employee can terminate the employment relationship at any time, with or without cause. Over the years, California courts and the Legislature created exceptions to California’s at-will presumption, increasing lawsuits for “wrongful termination.” Therefore, carefully consider each termination decision.

Let’s explore more about California at-will employment through these links:

Florida

Employees in Florida are subject to the state’s at-will Employment laws. This means that an employee can be terminated at any time, for any reason (or no reason), with or without advanced notice. While this may seem like it gives employers a lot of power over their employees, there are still certain protections in place to help protect employee rights and limit when an employee can be terminated.

Let’s explore more about Florida at-will employment through this link :

Texas

Texas is an “employment-at-will” state; an employer can fire an employee at any time for any lawful reason. Any lawful reason for termination may include a bad reason or no reason at all. However, if an employer fires an employee for an unlawful reason, this is referred to as wrongful termination and can lead to a legal claim.

Let’s explore more about Texas at-will employment through these links:

New York

Employees in New York State are considered “at-will” employees, meaning that the employee can be terminated without warning, at any time, and for any reason or no reason at all. While employment may be “at-will,” there is an exception to the doctrine of at-will employment in New York.

However, there are some exceptions to New York At-Will employment.

Let’s explore more about New York at-will employment through these links:

Montana

Montana is the only state that does not follow at-will employment. In Montana, employers must have a valid reason for terminating an employee, and employees can only be fired for just cause. For all other states, employers and employees alike can, in most cases, terminate employment for any reason.

Key Terms for At-will States

  • At-Will Employment: A legal doctrine allowing employers to terminate employees for any reason, without notice, and liability, as long as the reason is not illegal.
  • Termination Without Cause: The ability of employers in at-will states to end an employment relationship without providing a specific reason.
  • Just Cause: Just cause means that an employer has a good reason to fire a worker.
  • Wrongful Termination: Unlawful termination of an employee in an at-will state, typically when it violates anti-discrimination laws or public policy.
  • Employee Rights in At-Will States: Limited protection for employees regarding job security, allowing employers broad discretion in employment decisions.
  • Employment Contracts: In at-will states, contracts specifying employment terms may limit the at-will nature, provide protections, or require just cause for termination.

Final Thoughts on At-will States

The concept of at-will states underscores the flexibility afforded to both employers and employees in the United States. While it grants employers the legal right to terminate employees without cause, it also gives employees the freedom to leave their positions at their discretion. This arrangement is a fundamental aspect of employment law in most states, fostering a dynamic and adaptable labor market.

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ContractsCounsel is not a law firm, and this post should not be considered and does not contain legal advice. To ensure the information and advice in this post are correct, sufficient, and appropriate for your situation, please consult a licensed attorney. Also, using or accessing ContractsCounsel's site does not create an attorney-client relationship between you and ContractsCounsel.


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