Many employers mistakenly think if they don’t have a written contract with employees or their employees don’t have a union, then the employees are “at-will.” “At-will” employment may be terminated by an employer or an employee at any time for basically any reason. In Minnesota, employees are presumed to be employed “at-will.”
It is possible for an employer to unintentionally alter an employee’s “at-will” status and create an expectation of job security. Minnesota courts follow two major exceptions to “at-will” employment. One being an employer may not discharge an employee when the termination is against a well-established public policy, for example, firing an employee for filing a workers’ compensation claim after being injured at work. The second is the creation of an implied contract based on either policy statements made in an employee handbook or oral representations made by an employer to an employee.
If your employees are “at-will” employees, do not include the following in your employee handbook:
• Probationary terms – “At-will” employees are “at-will” before, during, and after probationary periods. Having probationary language may be interpreted as providing a guaranteed term of employment.
• Specific discipline procedures - Minnesota courts (pdf) have decided when an employee handbook includes specific disciplinary steps to be taken prior to termination, an employee’s “at-will” status is modified and some job security is presumed.
• “Just cause” for termination – Can create expectations of job security.
• Defining employees as “permanent” – Can create expectations of job security.
If you have “at-will” employees, you should not make specific promises in your employee handbooks which could lead employees to believe they had a guarantee to continued employment, and you should include clear and prominent disclaimers to prevent the creation of unilateral contracts with employees.