Texas is an “employment at will” state, and it’s important that employers understand exactly what that means, both for themselves and for their employees.
“At will” employment means that if there is no employment contract, either the employer or the employee may terminate the working relationship for any reason, at any time, with or without advance warning. (If a contract has been signed, both the employer and the employee are bound by its terms regarding termination.)
Employers in an at-will state may terminate employees for a good reason, a bad reason, or no reason — but not for a reason that violates state or federal laws. For example, terminating an employee based on his or her race, color, religion, gender, or national origin violates Title VII of the Civil Rights Act of 1964. Employees also cannot be legally fired for
As you might imagine, the issue of at-will employment can become complicated if an employee who has been terminated for performance reasons files a claim for wrongful termination based on discrimination. This is one reason why employers must keep detailed records on employee performance issues in addition to conducting and documenting regular performance reviews. While the burden is on the employee to prove wrongful termination, this documentation will help the employer to defend a decision to terminate based on legitimate performance concerns.
Employers must also understand that the same rules apply to what is called “constructive discharge.” Sometimes an employer will create a work environment so intolerable that the employee feels compelled to resign. A situation like this may be treated as a “constructive discharge,” which, in the eyes of the law, is equivalent to active termination.
To learn more about at-will employment, visit the following resources: