Legal Updates

4/16/2009

At-Will Employment: A Quick Refresher Course for Employers

Employment at-will “provides that absent express agreement to the contrary, either employer or employee may terminate their relationship at any time, for any reason.” Black's Law Dictionary, at 525 (6th ed. 1990). In an effort to hinder an employer’s ability to discharge an at-will employee, many employees will assert the existence of an agreement – oral or written – changing the terms of their employment. However, there are several ways an employer can protect itself from such a claim. And, implemented effectively, employers can short-circuit an at-will employee’s wrongful discharge claim – just like the employer did in the recent case of Chauvin v. RadioShack Corp., 2009 U.S. Dist. LEXIS 30564 (E.D. La. Apr. 9, 2009).

In Chauvin, the former employee alleged that RadioShack wrongfully terminated her employment following an absence from work for medical issues. More specifically, the plaintiff alleged that RadioShack breached an agreement to provide her with a leave of absence and return to work when that leave ended. In defense, RadioShack submitted three different documents the plaintiff had signed in connection with her employment – all of which detailed and confirmed her at-will status:

• First, the plaintiff expressly agreed with the terms of her “Preliminary Online Application” that, if employed by the Company, she would be employed at-will. The document also provided that if she was hired, her at-will employment could only be modified by a separate written document signed by the employee and an executive officer of the Company.
• Second, in her formal “Application for At-Will Employment,” the plaintiff again agreed to these same terms.
• Third, in acknowledging receipt of her “Team Answer Book,” the plaintiff signed a form confirming her at-will employment status with the Company.
• Moreover, there was also evidence of a personnel record noting the plaintiff had taken a leave of absence, which stated that “The below named person is an AT-WILL employee and no information on this form shall change the employment status.”

In light of these documents, and in the absence of any evidence of a separate, written document signed by an executive officer of the Company changing the plaintiff’s employment status, the Court granted RadioShack’s motion for summary judgment.

Employers seeking to establish and maintain at-will employment status for their employees should make note of the different forms and requirements utilized by RadioShack. Employment applications, offer letters and company handbooks should all contain language establishing an at-will employment relationship. In addition, employers should establish limits on the number and types of company personnel who are authorized to alter the employment status or relationship. And, for those persons who are so authorized, employers should require that the change be documented in writing only.

For assistance in reviewing, revising and/or drafting appropriate at-will language for potential and new employees (including applications, offer letters and/or handbooks), please contact any member of McGuireWoods’ Labor & Employment or Employee Benefits teams.

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