If youâve ever been terminated âwithout cause,â you know it stings. Being called into your managerâs office and hearing the words, âWeâre going to have to let you go,â are probably some of the harshest words youâll ever hear.
Once you got your bearings, you may also have felt angry about being fired without an explanation. You may even have had thoughts about suing your former employer.
Well-meaning friends may have even told you to go ahead and sue the company, that you have the âright to work.â They may have even mentioned that you lived in an âat-willâ employment state.
Though they had the best intentions, their understanding of at-will employment and right-to-work was probably inaccurate.
Letâs clarify what both of those employment terms are, how they apply to different types of employment (W-2, 1099), why itâs important that you understand what they mean, and more.
Over the years, I’ve noticed that the terms “right to work” and “at will employment” often get used interchangeably, leading to confusion about what each one actually means. As a human resources professional, it’s important to have a clear understanding of these distinct employment concepts, so I wanted to write an in-depth article exploring the key differences.
At Will Employment Overview
Let’s start with at will employment, as this is the default employment arrangement in 49 out of 50 states.
At will means that an employer can terminate an employee at any time for any reason, except for an illegal reason, with no warning. Likewise, an at-will employee is free to leave a job at any time for any or no reason without consequence.
The at-will doctrine gives both employers and employees maximum flexibility However, there are some exceptions that can override the at-will presumption
- Written or implied employment contracts stating employment is only terminated for cause
- Company policies and handbooks implying an employment contract
- Federal and state anti-discrimination laws
- Whistleblower protection laws
- Implied good faith and fair dealing
So in an at-will state, which again is every state but Montana, employment is at will unless an exception applies.
Right to Work Overview
In contrast, right to work has to do with a person’s right to work without being compelled to join a labor union or pay union dues. The National Labor Relations Act allows employers and unions to agree to “union security agreements” that require all employees to pay union dues, even if they choose not to join the union.
Right to work laws, passed at the state level, prohibit union security agreements, making union membership and dues voluntary even when a workplace is unionized.
Currently, 27 states have right to work laws:
Alabama
Arizona
Arkansas
Florida
Georgia
Idaho
Indiana
Iowa
Kansas
Kentucky
Louisiana
Michigan
Mississippi
Nebraska
Nevada
North Carolina
North Dakota
Oklahoma
South Carolina
South Dakota
Tennessee
Texas
Utah
Virginia
West Virginia
Wisconsin
Wyoming
In these states, employees in unionized workplaces cannot be compelled to pay union dues or join the union. However, the union still has a legal obligation to represent all employees.
Key Differences Between At Will and Right to Work
Now that we’ve covered the basics of at will employment and right to work laws, let’s summarize some key differences:
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At will relates to the employer’s ability to terminate employment or an employee’s ability to resign at any time. Right to work deals with compulsory union membership and dues.
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At will is the default arrangement in 49 states, with right to work the default in 27 states.
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At will gives flexibility to both employers and employees. Right to work gives employees the choice regarding unions.
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There are exceptions like implied contracts that can override at will, while right to work simply prohibits compulsory unionism.
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At will applies to non-union employees, while right to work deals specifically with unionized workplaces.
So in essence, at will employment gives employers firing flexibility while right to work gives employees union flexibility. An employee could be covered by both or neither depending on the state they work in and whether there is a union presence.
Can At Will Employees be Protected?
Many people assume that at-will employees can be fired for completely arbitrary reasons. But there are some limitations. As mentioned earlier, federal and state laws prohibit firing for discriminatory reasons, in retaliation for whistleblowing, etc.
Some additional protections for at-will employees include:
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Implied Contracts – Handbooks or policies with specific procedures for termination may form an implied contract overriding at will.
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Good Faith and Fair Dealing – All employment relationships have an implied covenant of good faith and fair dealing which may protect employees from extremely unfair termination.
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Public Policy – Termination violating public policy, such as firing someone for serving on a jury, may be wrongful discharge.
So at-will employees do have some safeguards against malicious firing, even if employment remains at will.
Tips for Employers
For employers operating in at-will states interested in maintaining maximum workforce flexibility:
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Before hiring, have applicants acknowledge their at-will status in writing.
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Avoid verbal commitments implying guaranteed employment, and don’t outline reasons for termination.
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Issue employee handbooks stating employment is at will.
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Provide equal termination procedures and document performance issues.
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Seek legal counsel regarding any termination questioned as discriminatory or in bad faith.
The Bottom Line
While at will employment and right to work laws both deal with employment arrangements, they address very different issues. At will allows employers to discharge workers without cause, while right to work makes union membership voluntary. It’s important to understand these distinctions to ensure proper compliance and allow each state’s default rules to work in your favor.
What is at-will employment?
The concept of at-will employment is simple: you can be fired for almost any reason, at any time, without any warning. It doesnât sound quite fair, does it?
But you also have the same option. You can also walk out the door at any time without giving your employer notice. Donât count on asking your former employer for a reference, but youâre legally within your rights to quit anytime youâd like.
Did you notice in the explanation of at-will employment that we italicized the word âalmost?â Thatâs because there is one very significant exception to at-will employment termination â discrimination.
Your employer cannot fire you because of your âprotected class,â including your gender, race, religion, nationality, or sexual preference. Federal and state laws list a variety of protected classes.
Employees also cannot be fired for reasons such as being a âwhistleblower,â refusing to break the law, or reporting sexual harassment.
The opposite of at-will employment is when your employer can terminate you for âjust cause.â This would include reasons such as theft or incompetence.
Belonging to a protected class doesnât mean you canât be disciplined or fired. But, most employers are very cautious about firing someone, like a person of color or a disabled employee, without just cause.
Just cause usually protects the employer from a lawsuit. Companies often have regularly scheduled performance reviews or will put an employee on a performance improvement program (PIP) to document why an employee has been disciplined or terminated.
Every state in the U.S. except Montana allows for the at-will termination of an employee. However, this doesnât mean the other 49 states have uniform rules.
For example, some states allow no exceptions to the rules beyond those required by Federal law, while others do.
Local governments can also pass laws concerning at-will employment, like when the City of New York passed an ordinance requiring the fast-food industry to only terminate employees for just cause.
If a dispute over a case of at-will termination lands before a judge, donât be surprised if the judge asks whether the employer had reasonable cause. The courts have been known to side with fired employees without a documented history of problems or proper procedures followed by the employer.
At-will employment for W2s vs. 1099s
Everything detailed above concerning at-will employment pertains to company employees who receive a W-2 every year.
The line gets a bit blurred regarding independent contractors who receive a 1099 from a company. Courts have paid more attention to what was said or implied, not just the absence of a formal contract.
If an employee can prove they were promised employment for a specific term of months or years, such as in an e-mail or text, they might be able to make the case they were not an employee-at-will. Attorneys, judges, and juries often become involved in disputes arising when contractors are ushered off the job without an explanation.
Though right-to-work sounds like the opposite of at-will employment, itâs actually an entirely different matter.
Right-to-work simply means your employer canât require you to join a union. Of course, it might not endear you to your boss and co-workers if you refuse to join the union, but it is your right, and you canât be terminated if thatâs your decision.
Twenty-eight states have right-to-work laws, which apply to state or federal government employees and private businesses.
Right-to-work is a controversial policy. Supporters say itâs unfair for someone to be forced to pay union dues which could then be spent lobbying for positions the individual would oppose. Opponents argue it allows non-union employees to get the same benefits members do without contributing.
Suffice it to say many conflicts have arisen between new employees who refused to join the union and their co-workers who supported the union by being members.
The Difference Between “Right to Work” and “At Will” Employment
How does at-will employment differ from right-to-work?
At-will employment solely focuses on either the termination of an employee or when an employee leaves. Right-to-work statutes make employers offer the choice of joining a union or not, but limit their ability to terminate employees if they choose to represent themselves.
What are at-will employment rights?
In addition to employment contracts, there are both federal and state laws that limit an employer’s at-will employment rights. These laws protect employees from adverse employment actions, including termination, based on many various factors. These factors can vary from state to state.
What is the difference between a right-to-work agreement and an at-will agreement?
The state may legally recognize the company as at-will, however, unions often provide additional protections for employees like wage negotiations and benefits. While at-will agreements operate with or without unions, right-to-work agreements ensure an employee’s choice in joining the union. Related: 7 Types of Unions and How They Work
Are at-will & right-to-work the same thing?
This is particularly true with legal terms associated with employment or labor laws. Two employment-related legal terms people regularly misuse are “ at-will ” and “ right-to-work .” Many use the terms interchangeably or confuse them for one another when, in fact, they each have entirely different meanings.
