What Is At-Will Employment in California?

At-will employment means an employee and an employer are free to end a working relationship at any time and for almost any reason. Many California employees don’t realize their employment is on an at-will basis—or the rights and obligations that come with this status.

In this blog post, we’ll explain at-will employment and its implications for employees and employers. We’ll also discuss some important exceptions to the law governing at-will employment in California.

Is California an At-Will State?

California is one of many U.S. states that follows an at-will employment standard.

Many California employees assume that their jobs are reasonably secure unless they perform poorly or break company rules. However, this is far from true. In reality, most employees in California are employed at will. Their employer can dismiss them without advance notice and for almost any reason—without facing legal consequences. In practice, it’s generally perfectly legal for an employer to fire you for trivial, petty, inaccurate or even for no reasons.

For example, imagine you’re working a shift at a gas station, and your coworker makes a big calculation error when handling a cash transaction. When your boss learns about the money lost, they blame you since your coworker has left for the day. Even though your boss is mistaken, it’s still within their legal rights to fire you for the error.

Remember, employees also have some benefits under at-will employment. If you’re an at-will employee, you can quit your job for whatever reason and at whatever time you wish, and your employer can’t sue you for it.

California’s at-will employment rules apply to most but not all employees. Some employment contracts or collective bargaining agreements include specific rules governing when and how employers fire workers. However, employees without a contract defining employment terms and conditions are presumed to be at will under California law.

Are There Exceptions to the California At-Will Employment Rule?

The at-will employment rule gives California employers a lot of leeway when it comes to termination. It is important to understand that an employer may terminate your employment for no reason, but not for an illegal reason. Let’s look at some situations when employers can face legal consequences for firing employees, even if they’re at will.

Discrimination

State and federal employment law protects employees from unlawful discrimination at work. In California, it’s illegal for employees to base any employment decision on an employee’s:

Gender,
Race,
Religion,
Sexual orientation,
Age (if over 40),
Pregnancy status,
National origin,
Citizenship status, and
Other protected characteristics.

These anti-discrimination protections still apply to an employer’s motivation for firing an at-will employee. For example, it’s illegal for an employer to consider an employee’s ethnicity when deciding whether to include them in layoffs.

Breach of Contract

The at-will employment rule doesn’t apply when an employer violates the terms of an express or implied contract by firing someone.

An express contract is a written or oral agreement between an employer and an employee. Employers can violate these contracts when they don’t follow the steps the agreement requires when dismissing someone. For example, an employee’s contract might require an employer to have “good cause,” i.e., a fair and business-related reason for firing someone, like poor performance or tardiness. A company that terminates someone without proper cause could face legal penalties if the employee sues.

In some cases, employers can also face legal repercussions for breaching implied employment contracts. This happens when the terms of a working relationship involve an unspoken but assumed agreement between employee and employer about the procedures required for termination. California courts have penalized employers for breaking these implied promises in the past. However, they are much more challenging to identify and prove than express contracts.

Violation of Public Policy

A violation of public policy happens when an employer punishes an employee for exercising their rights under California and federal law. For example, employers violate public policy when they fire employees for:

Complaining about harassment or discrimination at work,
Taking unpaid leave to care for a family member with a serious medical condition,
Holding certain political beliefs or affiliations,
Applying for workers’ compensation,
Filing a wage claim to recover unpaid compensation,
Organizing a union,
Reporting unsafe working conditions,
Blowing the whistle on illegal or unethical business practices, and
Participating in a workplace investigation.

If an employer’s motivation for terminating someone violates public policy, their dismissal is against the law. This is the case whether or not the employee targeted is at will.

What Happens If an Employer Fires an At-Will Employee Illegally?

Employers who dismiss employees for illegal reasons risk charges of wrongful termination. In legal terms, wrongful termination is when an employee’s firing violates a local, state, or federal law. Even at-will employees can bring a lawsuit against an employer who dismisses them for unlawful reasons, such as racial discrimination or whistleblower retaliation. Employees with successful wrongful termination lawsuits can recover lost income, compensation for emotional distress, and even job reinstatement.

Confidential, Compassionate Legal Expertise

Navigating the ins and outs of California’s employment law can be challenging. Failing to understand your rights and responsibilities in the workplace can have costly consequences. If you have questions or legal concerns about at-will employment, California employment attorney John Dalton can help. John has decades of experience helping ensure California’s workplaces are safe and compliant with state and federal law. As a litigator and advocate at The Law Office of John Dalton, he’s known for delivering empathetic, expert legal support for clients across California.