Termination and Employment Law Through the Years

Terminating employees is not always an easy process. Many employers believe they can simply terminate an employee because they are employed at will or that they have total discretion to terminate without cause without repercussions. However, it is not that simple.

Looking back through employment law history, the Unites States employment law borrowed a lot from England. There, termination for just cause was the standard. Then, the 14th amendment guaranteed workplace due process. This was based on the fact that the right to work was so fundamental to U.S. citizens that it should not be taken away without due process of law. This made it so that workers had a property right to their jobs, and employers could not terminate without just cause or good reason.

The next changes to employment termination rights came with the Great Depression. With Capitalism seemingly threatened, Congress felt the need to ensure that companies could stay in business during this time. This is when employment-at-will came to be, which shifted employment property right to the employers, giving them the ability to terminate employees without cause.

Then came the aftermath of World War II, where unions become popularized. The unions promised job security by way of workplace due process, which appealed to a large number of people. By the 1950s 25% of the U.S. workforce was part of some form of collective bargaining agreement. Today, that percentage is down to 12.

Part of the decline in these numbers was arrival of tort law. With it came the public-policy exception, which made it more difficult for companies to terminate using the employment-at-will affirmative defense. There were four major categories of exceptions to employment-at-will:

  • Public-policy exceptions
  • Statutory exceptions
  • Employment contracts
  • Implied contract exceptions/implied covenants of good faith and fair dealing

The development of all of this is why employers have to be diligent with performance reviews and documenting employee issues. If not, and the company terminates an employee who then brings a case against them, this is how it could play out:

At the hearing stage, many employers will use the employment-at-will affirmative defense in hopes of an immediate dismissal. They will rely on the employment-at-will relationship with the former employee, arguing they did nothing wrong and that there aren’t any material facts in dispute between the parties. . If a summary judgement is granted based on this defense, the case has ended before trial.

However, almost 90 percent of claims do not get dismissed at that stage. Litigation is very costly both in terms of money and in management time wasted.

The company improves its chances of avoiding litigation if it takes good care of its employees and keeps good documentation for each employee.

The attorneys at InnovaCounsel are experienced in employee termination, and in managing litigation if it becomes necessary. It is always a good idea to contact an attorney before making a decision that could lead to litigation.


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