E19: What Does At Will Employment Really Mean?

In this episode, host Thom Jennings and attorney Kathleen Jennings discuss the complex and yet simple legal term “At Will.” Does At Will really mean you can fire someone for wearing red socks? Kathleen will answer that question and many others, including the difference between At Will and Right to Work states.

Podcast Episode Transcript

Narrator (00:04):
You are listening to Cover Your Assets, a podcast that discusses the timely and significant legal issues faced by employers. Kathleen Jennings is an attorney who has over 30 years of experience in advising employers as to their legal responsibilities and has written extensively about employment law. Inner Popular Cover Your Assets blog. If your business has employees you cannot afford not to have your assets covered.

Thom Jennings (00:31):
Hello everyone and welcome to Cover Your Assets, the Labor and Employment Law Podcast. And as always, it seems to be we're repeating this theme over and over again, but we do want to thank you. The numbers are continuing to look good, our listenership is continuing to rise, and we we really appreciate that because if there's no listeners, there's no show. So thank you so much. And by all means, go back in the archives, check out some of the previous shows. We've been getting some listens with those as well. I think as people discover the newer episodes, they go back into the archives and that's one of the nice things about podcasts is that they, they live forever and even as laws change, some things don't. So that is one thing that I would, I think that my sister, aka a resident expert, a k a attorney, Kathleen Jennings, would probably agree with that. In every case, when you're dealing with legal matters, things change. So you need to find more than one source of information, and the best source of information is a reputable attorney. Speaking of reputable attorneys, Kathleen, how are you today?

Kathleen Jennings (01:40):
That was a beautiful introduction, Thom. I appreciate that. I'm doing great. How are you doing today?

Thom Jennings (01:45):
I'm doing good. We're in Western New York at the time of year. In case you're listening at another time of year is July. So we have about three days of sunshine. So we're enjoying all three of them <laugh> and before the snow sets in, in mid-July, and then it's football season. It's all crazy here.

Kathleen Jennings (02:02):
Wow. Well, it, I'm down here in southeast Georgia where it's just hot.

Thom Jennings (02:08):
All

Kathleen Jennings (02:08):
Right. And humid. I'll add humid as well. So hot and humid.

Thom Jennings (02:12):
So today's topic, which has absolutely nothing to do with weather, is one that seems to come up on a regular basis, and we teased it at the end of the last episode. So if you go back into the archives again for the previous episode to this one, it is the concept of at will employment. And I'm sure there's other kinds of tentacles that will kind of branch off of, well, I guess trees, branch tentacles, do tentacles branch.

Kathleen Jennings (02:41):
I think tentacles come off of OC Occupy.

Thom Jennings (02:45):
So we'll say this has all kinds of branches that that go along with this topic. But it it, in as much as it's a topic that may not seem sexy, it's still a topic that's important because there are a lot of misconceptions out there on both ends, both the employer and the employee end. So this will be helpful for everyone listening and again, make sure at, at any time we deal with topics like this. This one in particular really depends on the state, doesn't it?

Kathleen Jennings (03:14):
It does, absolutely. Each state has a different way of quantifying what or who is an at will employee, basically an at will employee. The very basic concept is if you are employed at will, you can be terminated at any time for any reason or no reason at all. And what some states have done is built in some exceptions to the at will employment rule. Some states have no exceptions. I live in Georgia, and there are basically no exceptions to the at will employment rule. If you're at will, you're at will. Other states have either by statute or by case law built in exceptions based on things like public policy which would include perhaps a whistleblower or worker's compensation retaliation. So this is an area where you have to absolutely know your state law and from an employer's standpoint, you have to know what to do and say, in order to let your employees know, communicate to your employees that they are at will or not, because you may not even know that you are creating an employ an implied contract of employment with your handbook if you're not careful.

Thom Jennings (04:41):
Yeah, I'm glad you mentioned that because I think this is the place where really an employer has to be extremely cautious. And we've discussed this in previous episode where, because this is something that pertains to, to state law, if you are an organization that has either expanded or maybe by design, you have employees across the country, you have to make sure that your handbooks and however you're providing that document, I would imagine right now there's probably a lot of employee handbooks that are fully electronic, but either way, there should be something in there that reflects the policy as it relates to the states. Correct?

Kathleen Jennings (05:21):
Correct, correct. There are some states that have very specific requirements for handbooks, and then there are states that don't necessarily have any specific requirements for handbooks. But you have to be careful what you say in a handbook because as I said before, you may create an implied contract of employment with your employees. And the example I would give is something to the effect of if you put a provision, maybe even in your introduction that says, you know, we here at Thom's Company promise you a job for life because we're a family company and we want you to stay with us as long as possible. And maybe that's just you, Thom, with your company telling people that you just appreciate them as employees. But an employee could take that to mean, well, Thom is giving me a contract for a job for life. Fantastic. He can't fire me now.

Thom Jennings (06:30):
So it it, and, and this is, well, it, this almost goes back to the 10 99 contractor situation as well. I mean, it it, the difference between a contract and not having a contract. So a 10 99 employees many people call that a contract employer because it's not an employer, but it's really just an agreement that says, Hey, you'll do this work, and you do it at your own pace. You know, you're in, you're independent in terms of the delivery of whatever that work is. Whereas an Atwell employee is like, Hey, you can work for me. Here's your hours, here's your benefits, here's everything. But if at some point I just decide I don't want workers, then I can just terminate you without, without having to give a reason. Correct.

Kathleen Jennings (07:13):
Correct. Correct. What with the proviso, and will I, I need to throw this in. You have to also be aware of federal anti-discrimination laws. So, or even federal whistleblower laws, such as something like OSHA retaliation. So although someone may be an employee at will under state law, you can't terminate them. Or if your, if your company is covered by Title VII or by osha, most everybody is federal wage and hour laws. You can't violate those laws when you terminate someone. So you can't terminate someone for a discriminatory reason or a retaliatory reason. And if you do, you're going to be subject to either administrative action or a lawsuit.

Thom Jennings (08:07):
And I mean, do you have an example maybe of a case that you've worked on where an employee was in an at will situation? They were terminated clearly just because of, you know, no, nothing that was violating the law, but the employer had done something that may have triggered the employee to file a lawsuit.

Kathleen Jennings (08:30):
I can give you the example as one of the first lawsuits ever handled as a young lawyer, many, not too many years ago, was an employee who filed a lawsuit for wrongful discharge, which is the, the type of action you would file for being discharged wrongfully. It's a tort claim. And this was a Georgia employee who was clearly an employee at Will. And this is sort of the this is, this is the cautionary tale about how home cooking can, can hurt you. But this was a fella who lived down in South Georgia, and the case should have been dismissed on summary judgment, but it just so happened that the judge assigned to the case lived next door to the plaintiff's lawyer in that case. And so the case ended up going to trial, which we won. But even if someone is an at-will employee, that doesn't prevent them from filing a lawsuit. It just means that you're gonna have to spend some money to win it.

Thom Jennings (09:41):
And I, but I mean, this goes back to an episode that we talked about in, in terms of terminating employees with dignity, because it, at some point this employee either didn't see it coming or was offended in some part of the process where they were terminated because

Kathleen Jennings (09:57):
That is correct.

Thom Jennings (09:58):
And, and you know, I mean, this is such a, a gray area because as somebody who's been terminated from jobs for various reasons, and even in some cases it was because of a corporate takeover and you lose your jobs and it, it never, it never feels good. But I will tell you from experience that that one company that was taken over, it was a bank and, and they eliminated our jobs. They provided us with job placement services after our jobs were gone. And to me, if nothing else, that, that seemed like an act of goodwill. So while there's not a requirement for an employer to say, Hey, we're gonna help you find another job, in your opinion, do you think that maybe in these at will states, it would be important for employers to say, Hey, you don't work out, you're not working out for us, but maybe we'll hook you up with an, with a company or somebody or some skills to, to find another position or even give that employee time to find another position so that they at least, that they don't feel as violated in the whole process?

Kathleen Jennings (11:03):
I think, Thom, it would depend on the circumstances of the particular decision. What you said initially is the most important concept, which is terminating people with dignity. If you don't terminate people with dignity, and we talked about this in an earlier podcast people who feel angry or upset about their termination because they didn't see it coming or they don't think it's fair, those are the folks that are most likely to seek out an attorney or even sometimes some of 'em just file the lawsuit on their own. But, but those are the people that are gonna cost you money in the long run.

Thom Jennings (11:50):
Alright. And look, I think you teased this, but we're gonna, we're gonna kind of flesh this one out as well, the public policy exception. What, what does that mean exactly? And in terms of the, the at will states and and laws and how that applies and and what should employers know about that?

Kathleen Jennings (12:10):
These are going to be something that is particular to a state. Different states have different exceptions. And usually through case law, what has happened is that the courts have carved out exceptions to at will employment because they see the reason for termination of an at will employee is something that is in violation of a public policy of the state. For example, a public policy that encourages people to be whistleblowers against government fraud or public policy that encourages people to file and worker's compensation claims when they're entitled to worker's compensation. So some states will find that it's a, a violation of the at will employment doctrine to terminate someone simply because they filed a worker's comp claim.

Thom Jennings (13:12):
And that goes back to retaliation, right? I mean, you, you, you, if somebody does file a complaint and you terminate them quickly afterwards, it's certainly not gonna look good. Do, do you think there's cases where maybe, and I've seen this I mean I myself haven't done it, but I've certainly seen it and, and, and this is kind of going back again to the terminating with Dignity, which was an early episode, but again, very important episode in our podcast. You know, we have an employee who has that fear that they're going to be terminated and they're going to start the process and maybe report the employer for something that maybe they're not even doing. And, and in fact, you know, maybe this leads me to a question that I have not asked before, but if an employee reports the employer for an, an illegal action, but then it turns out that the employer wasn't doing anything illegally, is it still retaliation if you report them for re for or if you, if you try to terminate them for reporting something? Does that make sense?

Kathleen Jennings (14:20):
Yes, it does. And it can be and, and this is one of the things that we emphasize to clients, particularly with something like Title seven retaliation. If for example, somebody reports sexual harassment and you investigate, you, the employer investigate and you find there's no basis to the complaint that person is still protected from retaliation unless they have knowingly made that false complaint. And, and proving somebody knowingly or, or knew the complaint was false when they made it, made it anyway is a very high standard. So usually that person, almost always, that person is protected from retaliation. And it's, it, it's another example of the coverup is worse than the underlying situation because there's no sexual harassment, but you may still be stuck with a retaliation claim and with retaliation claims a lot of times it's simply the timing of the complaint and the decision that's gonna make the difference as to whether the plaintiff is successful in their claim or not.

Thom Jennings (15:38):
Yeah, either way it's gonna cost you some money though. So it

Kathleen Jennings (15:41):
Is

Thom Jennings (15:41):
So awareness of, I mean, has there ever been a situation where maybe an employer in an atwell state or an even a non at will state that they terminate an employee and there has been a complaint but the employer maybe doesn't even know about it?

Kathleen Jennings (15:58):
Well, if the employer doesn't know about the complaint, you can't retaliate on the basis of something you don't know about. So that would be a situation where they, it wouldn't be retaliation because if you don't know about the complaint, you can't retaliate because of it.

Thom Jennings (16:16):
Let me reframe that a little bit. So let's say the complaint is made to either a coworker or somebody in a mid-level management situation, and they don't, they don't report that to either their higher ups or the hr. Now my, I assume this goes back to policy and we've already talked about how it's important in the employee manual to to, to let employees know that they are Atwell employees don't create those implied contracts. So here's the situation in terms of retaliation. I report it to my direct supervisor, my direct supervisor doesn't report it up the chain. Could that still be considered retaliation? And I, I would assume that the best way to mitigate that from happening is really make sure that your mid-level management knows that any complaint that goes to them needs to be immediately pushed to the right person.

Kathleen Jennings (17:07):
Well, there's, there's a couple of different issues there. First you have to look at with regard to the termination decision, who's the decision maker or decision makers? If the decision makers were above that immediate supervisor and were not aware of the complaint, then you can't show that they had any kind of discriminatory intent. However with regard to the substance of the complaint itself, if a complaint, especially sexual harassment, that's, that's where you can get in trouble. A sexual harassment complaint is made to a member of management and they do nothing about it, then you're going to have potential liability for that claim of sexual harassment.

Thom Jennings (17:59):
Hmm. So again, policy, policy policy, consistency. Consistency.

Kathleen Jennings (18:04):
Consistency. Exactly. Consistency. Exactly. So

Thom Jennings (18:07):
Let's circle back to Atwell cuz that is the topic today. And this topic was triggered by that another Reddit post, which Reddit seems to be getting a lot of love on this podcast, rightfully so. The question came back to, so we've kind of talked about the things that you can't do in an atwell state in terms of terminating an employee. So let's shift it to what you can do now. So the original question that was posed was, if I'm working in an at will state and my employer fires me for wearing Red Sox, can they legally do that? And your answer was

Kathleen Jennings (18:43):
Yes.

Thom Jennings (18:45):
So, so in the broader context of what are the things that an employer can terminate an employee for, without getting into the situations that we've discussed in terms of discrimination, retaliation, any of that stuff, federal laws, I mean, in other words, what would be the advantage of being in an atwell state and what are the things the employers in those states don't have to worry about?

Kathleen Jennings (19:10):
The advantage of being in an at will state is the ability to terminate an employee at any time for any reason or no reason at all, as long as that reason does not violate federal law. Otherwise what you're looking at is you would have to have good cause for termination or some kind of reason for termination if the employee is not at will. And this brings us to my biggest pet peeve about at will employment, which is that a lot of non-lawyers, I think probably some lawyers too, but a lot of people confuse the terminology right to work state with at-will employment. And they are two completely separate concepts, although I will tie this together with the potential overlap. A right to work state is a state where a person, an employee, does not have to join a union bargaining unit in order to work at a company.

Kathleen Jennings (20:23):
In other words, if the company is unionized, you don't have to become a member of the union in order to work there. There's some states that are not right to work states where if you are, if you have a bargaining unit in your workplace, you have to be a dues paying member or else you can't work there. And so that's different from at will employment. At will employment like we've talked about, is being the, the ability to terminate an employee anytime for any reason or no reason at all. The difference between the two is that in a unionized environment where there's a collective bargaining agreement, it is almost always the case that employees cannot be terminated at will. That there has to be good cause for termination in a union environment. And if an employee is discharged and it's challenged by the union, then you go through the whole grievance process, the arbitration process. So it is very different from being an at-will employee.

Thom Jennings (21:32):
Why is there confusion over the two terms then?

Kathleen Jennings (21:36):
I don't know if people just hear right to work and that makes them feel like I have a right to work here. I I, I don't know, I can't answer that. Maybe you as the non-lawyer <laugh> could answer that question for us, Thom.

Thom Jennings (21:52):
Well, I I mean, before we, before this topic came up, I mean, I, I would guess my initial impressions, I mean if you look at the terminology like said right to work, I mean, when we hear the term right, it means, hey man, you know, you can't, cuz we think rights, we think of things that are inherent to us in this country and if those are taken away from us, we, we've, those rights have been violated. So that's what I think when I hear right to work. And honestly, I don't even know if in New York state it's a right to work state or not. And I don't know if Georgia is either, but I I'm I'm wondering if maybe if our states either at will states or right to work or are they both? No, so, so that's, so, so maybe that's where the confusion lies is that basically this is the two camps then, right? So you're gonna, and I'm, I'm gonna, I'm gonna go out on a limb here. We've, we've here to forward not gotten real political, but I'm gonna assume that a right to work state would tend to be the bluer states and the at will states tend to be the redder states Or am I, am I oversimplifying?

Kathleen Jennings (22:54):
You got it backwards. Oh, I got the right backwards to the, yeah, the right to work states, those are the states where you don't have to join the union in order to ah,

Thom Jennings (23:03):
Work in it. So right to

Kathleen Jennings (23:04):
Work environment. So that's correct. So those are going to be your Yeah, and most of 'em are down here in the south. Georgia is a right to work state and the non-right to work states are gonna be, you know, something like Michigan, some of the older industrial areas where the unions have had a strong presence.

Thom Jennings (23:26):
Yeah, no, that makes sense cuz you're thinking Michigan cars, that's, I mean that's even really the, the, the beginning of the industrialized United States is gonna be the, the Model T in the assembly line and eventually the union's form out of there. So, but either way, I guess the importance is since this podcast is more or less focused towards the employer side of it, I mean you, you gotta know what state you're doing business in and your employee handbook really has to reflect that and mixing up these two terms could cause you a lot of problems, I'm assuming. But it it, it's and, and again, it's, it's a topic that's not for lack of a better term, it's not a real sexy topic, but it's an important one. And it, in terms of covering your assets, which is the title of the podcast. So my initial takeaway before be, begin your takeaways is make sure you educate your employees. Like make sure your HR person is well aware of this stuff. If you're unsure, consult with an attorney, you know, make sure that you understand how these, these terms can affect you when it comes to handling an employee discharge or just handling your entire workforce in whatever state you're doing business.

Kathleen Jennings (24:46):
I agree. And also particularly well, I I think in any state what we recommend is make sure your employee handbook has some kind of written disclaimer that explicitly states that this handbook does not create a contract of employment between the employer and the employees.

Thom Jennings (25:06):
Yeah. And that, and I, and I, you know, the whole, the, the, the concept of implied contract, I mean, like you said, it, it's, so there's, there's just that thin line where it, it, it's hard to believe, but I guess it makes sense and that's why things like this podcast are important to, in terms of the, the overall education when it comes to hr, that you could say something along the lines of, Hey man, we really care about you a as as your employer and have this benevolent attitude, but that could get you into a little bit of legal trouble because that could create an implied contract for somebody that isn't discharged in a way they feel respected and then they turn around and sue you. And let's, let's be honest, if we haven't said it before, win or lose in a lawsuit, you lose money. So you've, you've gotta, it, it's more important to stop that process at the beginning than cover yourself to win the actual lawsuit because you, nobody really wins in a lawsuit. Although some people say the lawyers do, but even then I think you would rather be working with employers to not get sued than just constantly have to be in court.

Kathleen Jennings (26:14):
You know, I'm not gonna answer that question, Thom, but

Thom Jennings (26:17):
<Laugh>,

Kathleen Jennings (26:19):
I don't mind being in court, but I understand, you know, I want my clients to come back and use me because I have covered their assets. So yeah, depends on the situation.

Thom Jennings (26:33):
Well, wouldn't you say an attorney, especially in employment law, it's kind of like car insurance. I mean, it's good, it's good to have them there when you get into an accident, but the reality is, is you should still be a, a safe driver so that you don't have to put too many claims in.

Kathleen Jennings (26:48):
That's a, that's an interesting analogy, <laugh>. And yeah, I, I could probably sign on to that, you know, but you wanna make sure that your attorney is ready just in case those lawsuits get filed.

Thom Jennings (27:00):
Yeah, I mean, it it, and it is important. I mean, all kidding aside, if you, if you don't have the right attorney who really understands what's going on in your workplace, they're, they're not gonna help you in a lawsuit. Even if it's one where, I mean, you, you, you've gotta put yourself in a position to protect your yourself when it comes to these lawsuits. But, oh, well anyhow great topic today. I, I, I'll be honest with you, when you first proposed it, I was like, boy, this is this is not a, this is not a great one, but it, it turned out

Kathleen Jennings (27:27):
To be no really <laugh>,

Thom Jennings (27:29):
I'm just being honest.

Kathleen Jennings (27:31):
<Laugh>,

Thom Jennings (27:31):
Wow. But there's, okay, but there's definitely a lot of layers to it and I can see why you put this out as far as it something being something that's very important. So with that, I'm going to take the softball and throw it to you because you're giving me the, see we do this tho those listening. We do this via Zoom and we should, we do a quick behind the scenes before we wrap this up because we didn't, we didn't do a lot of banter today and we're, we're still within our typical episode length, so we do these via Zoom and on previous episodes we've done things to distract each other, which mostly get edited out. So someday we've gotta do like a little b-roll blooper thing. I mean, I've got some of these, these tapes, but yes, as I was speaking the last time, if, if I go off on a tangent like I am now, my sister gives me the older sister, younger brother look like, oh my God, really? That's what I'm getting right now. Tilted head.

Kathleen Jennings (28:25):
There you are. Yeah,

Thom Jennings (28:25):
Tilted head and it's, and it's like, hey, I gotta get to lunch. So let's wrap this up. Isn't that that what it's coming down too?

Kathleen Jennings (28:32):
No, it's not coming down to Beth

Thom Jennings (28:33):
<Laugh>. Alright, well, with, with all that,

Kathleen Jennings (28:37):
Just, just trying to keep you on track because you, you do tend to run down the rabbit holes,

Thom Jennings (28:43):
But man, those rabbit holes were good today. A lot of stuff today. Constructive discharge back to 10 99 applied contract. So many terms. So with that being said, after our witty banter, what do we got for takeaway sis?

Kathleen Jennings (28:58):
Take away. Number one, don't drive me crazy by confusing. Right? To work with employment at will, two completely different concepts right to work means that you don't have to join a union in order to work in an environment that is unionized. Employment at will means that you can be terminated at any time for any reason or no reason at all. Subject to some exceptions in the various states that employers need to be aware of. Know your state law, as we've said many, many times before, but this is an area where you really need to know your state law.

Thom Jennings (29:41):
All right, well great stuff as always. I appreciate this. And as always, we appreciate comments, reviews, anything, anything good stuff we had. We've got some suggestions, suggestions, topic suggestions,

Kathleen Jennings (29:52):
Topics.

Thom Jennings (29:53):
Yeah. All right. Hot topics. Hot to, isn't that like a, isn't it like a clothing story? I don't even know if it exists. I used to take the kids there and they get skateboards and all that kind of stuff.

Kathleen Jennings (30:02):
Oh my

Thom Jennings (30:03):
Gosh, New York, New York is a right to skate state. But anyhow, nice. That's that rabbit hole we were just talking about before we wrapped up <laugh>. But anyhow, thanks as I appreciate it again, take a look back in the archives if there's a topic that you find interesting or if something you something you wanna learn more about, please then what's your contact information? Kathleen,

Kathleen Jennings (30:24):
Shoot me an email at kj j wilo w im l a w.com

Thom Jennings (30:30):
And of course, cover your assets. Labor employment is not just a podcast, it's a blog as well, so you make sure you check out it's a blog as well, and that is in the show notes. So with all that being said, we wanna thank you very much for listening for myself from my resident expert slash sister Kathleen Jennings, and from the lovely state of New York, a right to skate state and the lovely state of Georgia, which I don't know if it's a right to skate state or not. This top Jennings saying, see you next time. Cover your assets.

Podcast Disclaimer

The Cover Your Assets-The Labor and Employment Law Podcast is produced by Thom Jennings of the Caronia Media Group. For more details, you can contact him at thom@caroniamediagroup.com.

The information provided in this podcast is for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem. Use of and access to this podcast or any of the e-mail links contained within the site do not create an attorney-client relationship between Kathleen J. Jennings. The opinions expressed at or through this site are the opinions of the individual hosts and guests.