Do I Have To Treat My At-Will Employees Fairly? No, but Yes.

May 30, 2019 | By Andrew J. Horowitz

A common misconception by employers is that they have carte blanche to treat their at-will employees however they want as long as their reason for doing so is not illegal. Technically, this is true—an at-will employee can be fired for a good reason, a bad reason, or no reason at all.

But when an employee brings a discrimination claim, all of the employer’s actions and reasons for its actions will be carefully examined in mind-numbing detail. Because employers seldom come out and say that they are discriminating, employees and their lawyers try to draw inferences from subtle details in the fact pattern. For example:

  • The employer did not put me on a warning before firing me, in violation of the progressive discipline policy in its employee handbook;
  • The employer sided with the other employee in a dispute, despite the fact that a corroborating witness supported my version of events;
  • I was fired despite having better numbers than the person who was retained;
  • I was fired for something that was not my fault;
  • The employer rushed to fire me; or
  • The employer’s reason doesn’t make sense because ___________.

While these fact patterns are not dispositive of discrimination, courts have held that they can be evidence that the employer’s stated reason is a pretext (or excuse) for discrimination, especially when combined with other evidence.

Employers are allowed to make irrational or decisions. But when employers make decisions that are poorly-reasoned by comparison to their usual mode of operation, it can create an appearance that some nefarious motive was at play. Of course, you could argue that you always make poorly-reasoned decisions, but this is not a good position to be in.

Similarly, while your employee handbook likely has a preface that says that the handbook does not create a contract and the employer is free to change or deviate from the handbook at any time, the reality is that judges and juries generally expect employers to follow their own policies and practices, and will hold it against you if you don’t.

The takeaway from all of this is that perhaps the best way to minimize risk of discrimination claims when making termination decisions is to make good decisions. A good decision:

  • Is carefully considered based on an objective review of the facts rather than a rush to judgment. If there is a need to remove the employee to mitigate risk, suspend the employee pending the investigation and decision-making process rather than making a rushed termination decision;
  • If based on a pattern of conduct—that pattern is documented in an objective manner that doesn’t make it seem like the decision-maker was out to get the employee;
  • If based on a single occurrence of misconduct—all employees involved (especially the target employee) are interviewed before the decision is made;
  • Is consistent with all established employer policies and practices;
  • Is carried out with a view towards due process and fundamental fairness; and
  • Reasonable alternatives to termination are considered.

If you have questions regarding at-will employment, please contact Andrew Horowitz at andrew.horowitz@obermayer.com.

About the Authors

Andrew Horowitz

Andrew J. Horowitz

Associate

Andrew is a strategic and pragmatic attorney who focuses his practice on complex commercial litigation and employment law matters. Andrew serves as a trusted advisor to his clients. He enjoys taking a...

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