Question of the Week: What is At-Will Employment

Each week, we tackle a real HR question from business owners just like you. This week, we're covering a foundational concept in employment law that every employer should understand.

The Question:

"What is at-will employment?"

The Answer:

At-will employment means that the employer or the employee can end the employment relationship at any time, with or without notice, and with or without cause. It doesn't, however, allow an employer to terminate someone for an illegal reason, like their inclusion in a protected class or their exercise of a legal right.

Every state (except Montana) assumes the employment relationship is at-will unless there is a legal agreement in place that says otherwise. Assuming you want to maintain the at-will relationship with employees, we recommend including clear language about this in your offer letters and employee handbook.

Keep in mind that even with an at-will relationship, terminations carry risk. A terminated employee can always claim that they were terminated for an illegal reason, at which point you'd need to be able to show otherwise. To reduce that risk, you should have and document a lawful, business-related reason for each termination. This reason should also generally be shared with the departing employee, so they understand the legitimate reasons they were let go and are less likely to come up with their own theory, which could include a discriminatory motive.

The Takeaway for Employers:

At-will employment gives businesses flexibility, but it isn't a shield against every termination-related claim. The best protection is preparation: clear handbook language, documented reasons for termination, and open communication with departing employees.