Like most states, California has adopted the employment at will rule, which permits employers and employees to terminate the employment relationship without notice and without good cause for doing so. However, employers should be aware of the many exceptions to the employment at will doctrine, which do provide grounds for an employee to assert legal action against a company, including:

Prohibited Discrimination: This type of claim asserts that the employer has discriminated against an employee (either intentionally or unintentionally) in violation of state and/or federal laws prohibiting discrimination on the basis of race, age (40 and older), gender, disability, and other protected classifications.

Breach of Contract: Employees may also sue their employer based on an express or implied contract, alleging the employer breached the provisions of a contract. While an express contract is typically between the affected employee and the employer only (unless a collective bargaining agreement is in place), an implied contract can be found by operation of law based on an employer’s policies or practices which have been communicated to employees in writing, verbally or through the company’s past conduct toward other employees.

Retaliation: Claims of unlawful retaliation can take many forms. Some common grounds for asserting such a suit include retaliation for requesting or taking FMLA leave, filing a worker’s compensation claim or injury report, engaging in union activity, reporting illegal activity by an employer or refusing to engage in unlawful conduct.

Good Faith and Fair Dealing: California recognizes the covenant of good faith and fair dealing, which is imposed on the parties to express or implied employment contracts by the courts. This covenant requires that contracting parties act fairly and in good faith with one another in applying contractual terms. See our previous blog “CONTRACT LAW: The Implied Duty of Good Faith and Fair Dealing”. If an employee proves their employer acted in bad faith or unfairly toward them in fulfilling the company’s obligations to the employee, the employee may recover damages from the company.

This list of exceptions to the employment at will doctrine are not all inclusive, but sets out some of the most common exceptions to the default rule of employment at will. It is meant to highlight the need for planning by businesses, as well as performing a thorough assessment of each situation before terminating an employee to avoid legal claims.

For questions or more information about your company’s employment related matters, contact our experienced San Diego business and employment law attorneys at (877) 333-2420 or (858) 964-2314 today.

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