What Does “At-Will Employment” Mean in California?
California is an “at-will” employment state. This means your employer can fire you for basically any reason, or even no reason at all, as long as they aren’t breaking the law.
This article will help you understand what “at-will” employment means in California, as well as the exceptions and limitations to the rule. It will also highlight your rights as an employee and the protections you have against wrongful termination.
If you think you’ve been wrongfully terminated from your job, it’s important to speak with an employment lawyer as soon as possible. They can help you understand your rights and options.
The Core of At-Will Employment: Rights and Limitations
California is an at-will employment state, but what does that really mean for you as an employer or an employee? Let’s break down the rights and the limitations.
What is At-Will Employment?
At-will employment, as defined in Labor Code Section 2922, means an employer can end the employment relationship for any reason that isn’t illegal or discriminatory. The employer doesn’t have to have a good reason; they don’t have to have any reason.
That’s right: Under at-will employment, your employer isn’t legally required to give you a reason for letting you go.
Employee Rights and Protections
Even though California is an at-will employment state, employees still have rights and protections against wrongful termination and discrimination.
There are some reasons for termination that are illegal, even in an at-will employment situation. For example, employers can’t fire you for discriminatory reasons (based on your race, religion, gender, etc.) or in retaliation for reporting illegal activity. If your employer fires you for one of these reasons, you may have grounds for a wrongful termination lawsuit.
Exceptions to at-will employment: carving out protections
Even though California is an at-will employment state, there are exceptions to the rule. These exceptions, created through case law and legislation, offer some protection to employees in specific situations.
Contractual exceptions
If you have an employment contract that spells out the conditions under which your employment can be terminated, you are generally not considered an at-will employee.
Even without a formal, written contract, an implied contract can be created based on company policies, the length of your employment, assurances of continued employment, and common practices in your industry. For example, a receptionist who’s worked for a company for 10 years and is suddenly fired without warning may have a claim based on an implied contract stemming from company policies or past practices.
Public policy exception
It’s against public policy to fire someone for refusing to violate the law. If your termination violates a fundamental and important public policy, you may have grounds for a wrongful termination claim.
For example, if you were fired for refusing to break antitrust or discrimination laws, or if you were fired for refusing to misrepresent bribery payments, you may have a case.
Implied covenant of good faith and fair dealing
This legal concept protects you from being terminated in a way that violates company policies, denies you earned benefits, or is based on dishonest reasons.
For instance, if you were fired just to avoid paying you earned commissions, or if you were fired for reasons unrelated to poor performance, you may have a claim based on the implied covenant of good faith.
Fraud exception
If an employer makes false statements to get you to accept a job, and you’re damaged as a result, you may have a fraud claim. For example, if you moved across the country for a job based on false promises about the company’s financial stability, you may be able to sue for fraud.
What legal options do I have if I’m wrongfully terminated?
Even in an at-will state like California, you have the right to seek legal remedies if you believe you’ve been wrongfully terminated.
Filing a claim
If you think your firing was illegal, you may be able to file a complaint with a government agency such as the Labor Commissioner, the Civil Rights Department, or the Equal Employment Opportunity Commission (EEOC). Be aware, though, that there are deadlines for filing these types of complaints, so it’s important to act quickly.
Potential remedies
If you win your case, you may be awarded damages to cover lost income and emotional distress. In cases where your employer acted with malice, oppression, or fraud, you may even be awarded punitive damages designed to punish the employer for their behavior.
Recent legal developments
California’s SB 497, also known as the Equal Pay and Anti-Retaliation Protection Act, creates a “rebuttable presumption” of retaliation. If you’re fired within 90 days of engaging in a protected activity (like reporting discrimination), the law presumes your firing was retaliatory. SB 497 also includes a penalty of up to $10,000 per employee for violations.
Frequently Asked Questions
What is the 72-hour rule in California?
The “72-hour rule” in California labor law doesn’t refer to termination, but to when a final paycheck must be provided. Generally, if an employee quits without providing prior notice, the employer has 72 hours to make the final payment available. If the employee provides notice, the final paycheck is due on their last day of employment.
What does an at-will state mean?
Being an “at-will” state means that an employer can terminate an employee for any reason that isn’t discriminatory or illegal, and an employee can quit their job at any time for any reason. There is no requirement for “just cause” for termination, and neither party needs to provide notice.
What is the at-will presumption in California?
California operates under an “at-will presumption.” This means that employment is presumed to be at-will unless there is evidence to the contrary, such as a written contract specifying a term of employment or limitations on termination. This presumption can be challenged, but the burden of proof lies with the employee to demonstrate that their employment was not at-will.
Closing Thoughts
If you work in California, it’s important to understand your rights under the state’s at-will employment laws. While at-will employment gives employers broad latitude, it doesn’t mean they can fire you for any reason, or without a reason.
If you think you’ve been wrongfully terminated, talk to an experienced employment lawyer as soon as possible to protect your rights. It’s also a good idea to keep detailed records of emails, memos, performance reviews, and any other communications related to your job. These records can be crucial if you decide to pursue legal action.