At-Will Employment: What Does it Mean for Your Business?

Are you confused about what “at-will employment” means and how it could affect your business? You’re not alone. Many employers wonder whether they can actually fire an employee without cause. On the other hand, employees wonder whether they can be fired at any given time or even quit without providing two weeks’ notice. Let’s take a closer look at what at-will employment means for your business.

What is at-will employment?

Let’s start with the basics. The term, “at-will employment” means the employer/employee relationship can be terminated by either party at any time, with or without notice (as long as that reason is not illegal—as in, because of a protected class). 

The only exception is if there is a contract binding the employer and employee. But these are very rare. In almost every case, in every state, you are dealing with an at-will employment situation.

Does this mean an employee doesn’t really have to give two weeks’ notice? Correct.

Does this mean you can fire an employee at a moment’s notice, as long as it’s not for illegal reasons? Correct.

But, should those two things happen? Nope. 

Let's look at both sides.

How to terminate at-will employees

Can you fire an employee whenever you want, with no warning or notice?

Technically yes (again, as long as it’s not for an illegal reason). But should you? Probably only in rare, egregious circumstances—like theft, or severe misbehavior, etc.

If you want to fire someone, think about the tone it sets in your office and the message you are sending other employees. Think about the culture it creates to fire someone on the spot—it can create a fear of making mistakes, a fear of, “one little thing I get wrong could be the end for me.” It also builds a sense of distrust in leadership and management.

As morale sinks, an employee might start to worry, “If they think so little of me that they could fire me at any moment, I may not want to work here long term anyway, and I certainly won’t give maximum effort.”

What should I do in advance to prepare, then?

First, document clearly any performance warnings, write-ups, or performance discussions. Simply record what was said, and what expectations were shared, in plain, objective language. This can be something as simple as an email to yourself. With that documentation in place, if you decide to terminate someone you can clearly demonstrate it was for performance work-related reasons.

In the rare case that you do terminate someone with no previous warnings, document the objective facts clearly, including the reason for termination. Be careful, but do feel empowered that you are okay to terminate immediately in an extreme circumstance.

How to manage quitting employees

Can the employee just walk away from their job?

Technically, yes, an employee can quit on the spot. (Ouch, right!?) But it’s true, they can just walk out at any time.

What about providing two weeks’ notice? Isn’t this a requirement?

Providing notice is considered good professionalism and etiquette when quitting. Most employers and employees consider it standard. But there is no legal requirement to do so.

How can you prevent an employee from quitting without notice?

The bad news is, you won’t be able to entirely avoid employees who quit without providing notice. Employees are able to choose their own workplace. But if an employee walks out, certainly call or talk to them to see if they are serious or would reconsider. But be warned, there is a high likelihood that they will screen your calls. Don’t take it personally.

Now, you can put some simple expectations in place (like in your employee handbook) that politely state your expectation that two weeks’ notice is given when someone resigns. Something simple like, “If you decide to leave the company for another opportunity, we ask you to give us two weeks’ notice.  This allows us—and you—to effectively plan so it’s a smooth transition for all involved”.  (At times, companies say something like, “Your PTO balance won’t be paid out if you don’t give two weeks’ notice.” I don’t recommend that tone as it starts to feel heavy-handed and punitive.)

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Build the right culture

My single greatest piece of advice?  My pro-tip?  Ask.  Yes, that’s right.  Ask your employees.

Ask them what might cause them to leave. Ask them what might drive them so crazy that they would walk out. Ask them what outside factor would cause them to walk away. You start to learn things about your employees that become an indicator as to what might cause them to up and leave.

My experience has been that in a culture of trust and strong values, a walkout (or even a no-show) is less likely to happen. Maybe even rarely. If you cultivate an atmosphere of respect, trust, and open communication (by not firing people on the spot with no warning, for example), you can minimize the times it happens to you.

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Scott Ence
Written by
Scott Ence
During Scott’s 15 years in HR, he has learned the importance and power of connecting HR practices with business strategy. He has worked in different industries, from 40 employees to 2,000, identifying key elements in areas of HR that help companies succeed. He now shares his experience and knowledge with small businesses, hosting a community called “HR Team of One” for employees in small companies who manage HR tasks. It is a place to share resources, information, and support. Join the HR Team of One free Facebook group or subscribe to premier access. You can also connect with Scott on LinkedIn.
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