Understanding At-Will Employment in California
In most states, including California, employment is “at-will.” This means your employer can fire you for almost any reason — or even for no reason at all. Likewise, you’re free to leave your job whenever you want. This might sound unfair, but it’s the law in California.
Because California is an at-will state, it’s important for both employers and employees to understand the rules and, more importantly, the exceptions to this rule. Just because California is an at-will state doesn’t mean employers can fire employees for any reason.
This outline will give you a comprehensive overview of California’s at-will employment law, including the exceptions and your rights as an employee. We’ll cover Labor Code Section 2922, exceptions to at-will employment, and what rights you have.
The foundation: At-will employment defined
California is generally considered an at-will employment state. This means that, unless there’s an agreement to the contrary, your employer can end your employment at any time, without giving you a reason.
In an at-will employment situation, employers aren’t required to show “just cause” or any cause at all when terminating an employee. The principle of at-will employment is written into California Labor Code Section 2922.
Employer and employee rights
Under at-will employment, employers have the right to fire employees without warning or reason, as long as there’s no contract or agreement stating otherwise.
Employees, too, have rights under the at-will doctrine. You can leave your job at any time, for any reason, without giving notice. It’s considered a two-way street.
Exceptions to at-will employment: Contractual agreements
There are a few exceptions to the at-will employment doctrine in California. One is when there’s an employment contract in place.
Express contracts
If you have an express contract with your employer that says you can only be terminated for a specific reason, or after a specific process, then you’re not an at-will employee.
These contracts spell out the terms of employment, including how long the job will last and under what conditions you can be terminated.
Implied contracts
An implied contract is a little different. It’s not written down, but it can be created through things like company policies, how long you’ve worked there, statements from your employer, and even what’s typical in your industry.
For example, if you’ve worked at a company for many years and always gotten great reviews, and the company handbook says employees are only fired for cause, a court might find that there’s an implied contract in place that protects you from being fired without a good reason.
Exceptions to at-will employment: Violations of public policy
Even in an at-will employment state like California, there are exceptions. You can’t be fired for just any reason.
Defining the public policy exception
One exception to the at-will employment rule is known as the “public policy exception.” It means you can’t be fired for refusing to break the law, fulfilling a legal obligation, exercising a legal right, or reporting illegal activity.
In other words, an employer can’t terminate you for reasons that violate fundamental public policy.
Examples of public policy violations include:
- Terminating an employee for refusing to participate in illegal activities
- Terminating an employee for reporting safety violations
- Terminating an employee for filing a worker’s compensation claim
Establishing a public policy violation claim
To win a wrongful termination lawsuit under the public policy exception, you have to show that the public policy is well established and fundamental. Also, the public policy must be clearly defined in a statute or constitutional provision.
Other Exceptions and Protections: Good Faith, Discrimination, and Retaliation
Even though California is an at-will employment state, there are still some protections for workers. You can’t be fired for just any reason.
Implied Covenant of Good Faith and Fair Dealing
California courts recognize something called the “implied covenant of good faith and fair dealing.” This means your employer can’t fire you in bad faith—for example, for violating company personnel policies or to keep you from getting benefits you’ve earned. Employers have to act fairly and reasonably when they terminate someone.
Illegal Discrimination and Retaliation
It’s also illegal to fire someone for discriminatory reasons, like because of their race, religion, gender, age, or disability. And you can’t be fired for retaliatory reasons—for example, because you claimed your rights or reported unsafe or illegal conditions at work.
California’s SB 497, also known as the Equal Pay and Anti-Retaliation Protection Act, says that if you’re fired within 90 days of engaging in a protected activity, there’s a presumption that you were fired in retaliation. The employer would then have to show they had a legitimate, non-retaliatory reason for the firing.
Frequently Asked Questions
What are the exceptions to at-will termination in California?
Even though California is an at-will employment state, there are several exceptions that protect employees from wrongful termination. These exceptions fall into several categories:
- Implied Contract: If an employer makes promises of continued employment (written or verbal), it can create an implied contract that overrides at-will status.
- Public Policy Violations: You can’t be fired for refusing to break the law, reporting illegal activity, or exercising your legal rights (like voting or taking family leave). These are considered violations of public policy.
- Discrimination: California law prohibits termination based on protected characteristics such as race, religion, gender, age, disability, sexual orientation, and other factors.
- Retaliation: It’s illegal to fire someone for reporting harassment, discrimination, or unsafe working conditions. This includes retaliation for filing a worker’s compensation claim.
- Breach of Contract: If you have a written employment contract that specifies the terms of termination, the employer must adhere to those terms.
If you believe your termination falls under one of these exceptions, it’s crucial to consult with an employment law attorney to discuss your rights.
To Conclude
It’s important to understand that even though California is an at-will employment state, there are significant exceptions to the rule. Knowing these exceptions is vital for both employers and employees.
If you believe you’ve been wrongfully terminated or discriminated against at work, it’s best to speak with an employment lawyer right away. Talking to an attorney soon after a termination can help protect your rights and ensure you don’t miss any deadlines for filing a claim.
Employees who believe they’ve been unlawfully terminated may also be able to pursue remedies through the California Department of Industrial Relations. Seeking legal advice is essential to navigating the complexities of California’s employment laws and understanding your options.