What Does “At-Will Employment” Mean in California?
California is an “at-will” employment state. This means employers can fire employees for any reason, or even no reason at all, with or without warning. The same holds true for employees, who are free to quit their jobs at any time, without notice.
However, that freedom isn’t absolute. There are important exceptions to the at-will employment doctrine. An employer can’t terminate you for an illegal reason, like discrimination.
This article offers a comprehensive overview of what “at-will” really means for California employees. We’ll explain the exceptions to this rule and outline your rights as a worker in the state. California Labor Code Section 2922 codifies the at-will employment principle, but it’s essential to understand the nuances and protections that exist alongside it.
The core of at-will employment: Employer and employee rights
In California, “at-will” employment means that an employer can end your job at any time, and for any reason. Usually, they don’t even have to give you a reason. It could be because of performance, restructuring, or just that the company’s needs have changed.
But it works both ways. You, as the employee, also have the right to quit whenever you want, and for whatever reason (or no reason at all). It’s important to know your rights and protections, especially when it comes to things like wrongful termination or discrimination.
That said, employers don’t have carte blanche to fire people. There are exceptions to the at-will doctrine that protect employees from terminations that break the law.
Exceptions to At-Will Employment: Contractual Agreements
Even in an at-will employment state like California, certain contractual agreements can override the at-will doctrine. These agreements can be either express or implied.
Express Contracts
Express contracts are written or verbal agreements that clearly lay out the terms of employment, including the duration of the job. These contracts supersede at-will employment. Examples include formal employment contracts and collective bargaining agreements.
For an express contract to be valid, it must state clearly that the employment is not at-will. If the contract’s language is vague or unclear, a court may still interpret the employment relationship as at-will.
Implied Contracts
Implied contracts are agreements that aren’t written down but are inferred from an employer’s policies, practices, and assurances. These can be based on factors like length of service, consistently positive performance reviews, and statements made by the employer about job security.
To prove an implied contract exists, an employee must show they had a reasonable expectation of continued employment based on the employer’s behavior. Keeping records of employer policies and practices is essential in these cases.
The Implied Covenant of Good Faith and Fair Dealing
Even in at-will employment, California law recognizes something called the implied covenant of good faith and fair dealing. This means every employment contract, even an unwritten one, assumes both the employer and employee will act honestly and fairly.
This covenant protects employees from being fired in bad faith or for malicious reasons. Some examples include:
- Firing someone right before commissions or benefits are paid out, specifically to avoid paying them.
- Not following established company policies when terminating an employee.
If you believe your termination violated this covenant, documenting company policies and communications can help support your claim.
Public policy exception: Protecting employees who act in the public interest
Even in an at-will employment situation, you can’t be fired for taking actions that serve the public good. This is a major exception to the at-will employment doctrine.
These are some examples of activities that are protected under California law:
- Refusing to break the law. For example, your employer can’t fire you for refusing to take part in fraudulent business practices.
- Performing a legal obligation.
- Exercising a legal right.
- Whistleblowing, or reporting illegal activity. Retaliation for whistleblowing is illegal under California law.
In order to pursue a public policy claim, you must be able to demonstrate that:
- The policy you were supporting is outlined in the state’s constitution or statutes.
- The policy benefits the public.
- The policy is substantial and fundamental.
Fraudulent Misrepresentation as an Exception
California’s “at-will” employment law has some exceptions. One is fraudulent misrepresentation. This comes up when an employer makes promises they know aren’t true to convince someone to take a job. For example, an employer might lie about how stable the company’s finances are.
To make a successful claim of fraudulent misrepresentation, you typically need to show:
- The employer lied.
- The employer knew the statement was false.
- The employer meant for the employee to act based on that false statement.
- The employee reasonably believed the false statement.
- The employee was harmed as a result.
What to do if you think you’ve been wrongfully terminated
If you think your employer fired you illegally, it’s important to take action. Here are a few things you can do:
- Talk to a lawyer. An experienced employment lawyer can help you figure out if you have a case.
- Gather evidence. Save any documents related to your job and your firing.
- File a complaint. Consider filing a complaint with a government agency, such as the Labor Commissioner, the Civil Rights Department (CRD), or the Equal Employment Opportunity Commission (EEOC).
Frequently Asked Questions
What qualifies as a will in California?
In California, a will must be a written document, signed by the person making the will (the testator), and witnessed by two adults who understand they are witnessing the testator’s signature. Holographic wills, written entirely in the testator’s handwriting, are also valid, even without witnesses.
What does at-will mean in California?
In California, “at-will” employment means an employer can terminate an employee for any reason, or no reason at all, as long as it’s not an illegal reason. Similarly, an employee can quit their job at any time, without notice. This is the default employment relationship unless an agreement (like a contract) specifies otherwise.
What are the exceptions to at-will termination in California?
Even in at-will employment, terminations can’t be based on discrimination (e.g., race, religion, gender), retaliation for reporting illegal activities (whistleblowing), or a violation of public policy (e.g., firing someone for refusing to break the law). Implied contracts, where an employer’s actions or statements suggest a promise of continued employment, can also limit at-will termination.
Putting It All Together
California’s employment laws are complex, but here’s what’s important to remember about at-will employment: While it’s the default arrangement, it’s not absolute. Employers can’t fire you for discriminatory reasons or in violation of public policy.
It’s crucial to understand your rights as an employee. If you think you’ve been wrongfully terminated or discriminated against, talk to an employment lawyer as soon as possible. Staying informed and taking proactive steps can help protect your interests in the workplace and ensure you’re treated fairly.