A Short Summary of California At-will Employment

Note: This guide is for information only and is not legal advice. Legal advice must be tailored to specific facts. This guide does not address all possible claims, exceptions or conditions related to the subject matter discussed.

California employment is most often at-will, per Labor Code section 2922. “At-will" employment allows an employer to do almost anything it wants with respect to employment. It can rearrange, modify, change, eliminate, and add jobs, hours, compensation, benefits, schedules, duties, titles. It can hire, fire, transfer, demote, promote, train, and not train employees. These changes must take effect prospectively (in the future). For example, an employer cannot change your pay rate for work you have already done, but can change it for work you have not yet done.

There are a just a few things that might prevent an employer from doing what it wants:

(1) public policy;

(2) Constitutional (civil service) rights;

(3) a collective bargaining agreement (union contract);

(4) an individual contract;

(5) contracts for a specific term; or

(6) employment policies.

(1) Public policy refers only to things that are specifically prohibited by a statute (law) enacted by the legislature, or prohibited by a regulation promulgated (established ) by a government agency. Public policy includes statutes prohibiting discrimination against people in specific protected groups which include sex, race, color, national origin, disability, sexual orientation, age (40 years and older), religion, marital status and pregnancy.

In this context, “discrimination" means "to treat differently from others who are not in the same protected group, but are similarly situated." “Discrimination" does not mean an employer has to be fair, or has to make good decisions.

In California, a person complaining of discrimination must file a claim with an administrative agency before he or she can file a lawsuit. The person can file a claim with either the California Department of Fair Employment and Housing within one year of the discriminatory act, or with the federal Equal Employment Opportunity Commission (EEOC) within 300 days of the discriminatory act.

Public policy also protects people who blow the whistle on a matter of public concern, complain about improper wage and hour practices, or who exercise voting rights, family leave rights, jury duty rights, domestic violence rights, and a few more statutes. There are various ways to enforce these rights.

When people talk about “wrongful termination," they are really talking about wrongful termination in violation of public policy. For a termination to be “wrongful," it must violate a public policy. An employer cannot change terms of employment or fire you if the reason for the change is against the law. For example, an employer cannot increase your workload because of your race, sex, national origin, religion, etc. or because you blew the whistle on safety violations.

(2) Constitutional rights, sometimes called civil service rights, apply to employees of government agencies, who are entitled to due process with respect to employment decisions. Employees of government agencies have a right to advance notice of a final employment decision and an opportunity to explain why the decision should not be made. Usually, there are well-defined job duties for specific job classifications, established pay rates, and policies that apply to the entire workforce. Typically, these rights are enforced through a system the employer agency established, or which another government body established. Many of these claims must be filed within six months of the offending event.

(3) A collective bargaining agreement(CBA) is a contract between an employer and a labor organization (union). The CBA includes all the grievances, arbitrations and memoranda of understanding that interpret or supplement the CBA. A CBA is similar to a small body of law that applies only to the group of job classifications covered by the CBA. The rights and responsibilities of the employer, employees, and union are as stated in the CBA. A CBA is enforced by the union, not by a private attorney. Time limits can be extremely short, sometimes just two or three days.

(4) There are three kinds of contracts that a court may enforce. The first is a written contract which expresses (states) some or all terms of employment. People who work in certain industries are more likely to have this kind of contract: science, the arts, upper management, law, academia, intellectual property, finance, and a few more. The contract will include terms of employment which the employer and the employee have to follow. If a party does not, the other party has a potential claim for breach of contract. These contracts may be enforced in court or by arbitration, depending on the terms of the contract. In California, a person can usually enforce a written contract by filing a lawsuit within four years of the breach.

Some documents look like employment contracts but are not. These documents are an employer’s way of recording that employment is at-will. Terms usually address a lack of rights rather than rights the employee has, and nearly always require the employee to sign a statement agreeing the employment is at-will.

A second type of contract that a court may enforce is an express oral contract. These can be difficult to prove because there is no formal record of the agreement. A person has two years from the date of breach to enforce an oral contract.

Finally, even if there is no express contract, a court may decide there is an implied contract; generally, that this particular employee in this particular situation had a right to be treated differently. Getting a court to recognize an implied contract is an even higher hurdle than getting a court to recognize an oral contract. Courts rarely find implied contracts, and when they do, they are limited to long-term employees with a certain kind of employment history.

(5) Some employees are hired for a specific term(duration). For example, an employee may be hired to work from March 15 through November 24, 2012. In this situation, the employer cannot end the employment during the specified term unless the employee violates significant terms of employment or fails to perform. These contacts are enforced by filing a lawsuit in court.

(6) Some employers have written or unwritten policies or employee handbooks. These are effectively contracts, but instead of applying to one employee, they apply to all or many employees. The policies are written by the employer for the benefit of the employer. Many – perhaps most – employer policies include a statement that employment is at-will, or that the handbook does not create a contract, or that the employer can change the terms at any time. An employer's policies may include an enforcement procedure, such as submitting a complaint to personnel or human resources. If not, the policies may be enforceable in a court of law, but enforcement can be difficult; terms often conflict, in that they are written to appear as if employees have rights, but also include statements that employees do not have any rights and/or are at-will.

California employment law is a complicated, fact-intensive subject. Nearly every plaintiff is better off with an attorney. To find a plaintiffs employment attorney in California, please go to the web site of the California Employment Lawyers Association (CELA). CELA is the largest and most influential bar association in the state for attorneys who represent working people. The web site is www.cela.org, and you can search for attorneys by location and practice area.

Note: This guide is for information only and is not legal advice. Legal advice must be tailored to specific facts. This guide does not address all possible claims, exceptions or conditions related to the subject matter discussed.