At-will employment: Overview, definition, and example
What is at-will employment?
At-will employment refers to a type of employment relationship where either the employer or the employee can terminate the employment at any time, for any reason, or for no reason at all, with or without notice, and without liability. This arrangement is common in many countries, including the United States, unless a specific contract or collective bargaining agreement states otherwise. While at-will employees can leave their job at any time, the employer also has the same flexibility to terminate the employment.
For example, an employee working under an at-will agreement may decide to resign with no prior notice, or an employer may choose to let the employee go without providing a reason, as long as the termination does not violate any employment laws (e.g., discrimination laws or public policy exceptions).
Why is at-will employment important?
At-will employment is important because it provides flexibility for both employers and employees. For businesses, it allows the freedom to terminate employees without the need for a lengthy process or cause, making it easier to adjust staffing levels based on business needs. For employees, it offers the ability to leave a job without being bound by a contract or specific terms. However, it is also important to note that at-will employment does not mean an employee can be terminated for illegal reasons, such as discrimination or retaliation.
For businesses, clearly establishing at-will employment terms in contracts or employee handbooks ensures that both parties understand the nature of the relationship and the conditions under which termination can occur.
Understanding at-will employment through an example
Imagine a company hires an employee to work as a marketing specialist under an at-will employment agreement. Both the employee and employer understand that either party can end the employment at any time, with or without cause. The employee may decide to leave for another opportunity without giving prior notice, and the employer may terminate the employee’s contract if they believe it is no longer a good fit, without needing to provide a specific reason.
In another example, a retail company may employ seasonal workers under at-will employment contracts. If the business needs to downsize after the peak season, the employer can let go of employees without any obligation to provide severance, as long as the dismissal is not based on illegal grounds.
An example of an at-will employment clause
Here’s how an at-will employment clause might look in a contract:
“The Employee’s employment with the Company is at-will, and either the Employee or the Company may terminate the employment relationship at any time, with or without cause and with or without notice, subject to applicable laws. Nothing in this Agreement shall be construed as a contract of employment for any specific duration.”
Conclusion
At-will employment provides flexibility for both employers and employees by allowing either party to terminate the employment relationship at any time, with or without cause, and without the need for advanced notice. While this arrangement benefits both sides in terms of flexibility, it is essential to ensure that terminations are not made for unlawful reasons, such as discrimination or retaliation.
For businesses, clearly defining at-will employment terms helps set expectations for both employers and employees and ensures compliance with employment laws.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.