Wrongful Termination - Public Policy Violation

While an employer has the right to fire an at-will employee for a good reason, for no reason, or even for an arbitrary or irrational reason, the employer may not terminate the employee for an unlawful reason or a purpose that contravenes fundamental public policy. Employees have a wrongful termination cause of action against employers who fire them for performing an act that public policy would encourage, or for refusing to do something that public policy would condemn. When such an employment termination occurs, the nature of the employee’s relationship with the employer, whether at will or contractual, is essentially irrelevant. What is vindicated through the cause of action is not the terms or promises arising out of the particular employment relationship involved, but rather the public interest in not permitting employers to impose as a condition of employment a requirement that an employee act in a manner contrary to fundamental public policy.

In a wrongful termination in violation of public policy action, the public policy must involve a subject which affects the public at large rather than a purely personal or proprietary interest of the employee or company. The policy at issue in the legal battle must also be fundamental, substantial and well established at the time of discharge. Courts in wrongful discharge actions may not declare public policy without a basis in either constitutional or statutory provisions. The public policy exception to the general at-will employment termination rules in California are carefully tethered to fundamental policies which are delineated in constitutional and statutory provisions. Taken together, the public policy exception to wrongful termination of at-will employees strikes a proper balance among the interests of employers, employees, and the public in general. The company is bound, at a minimum, to know the fundamental public policies of the state and nation as expressed in their constitutions and statutes; so limited, the public policy exception presents no impediment to employers that operate within the bounds of law.

Employees are protected against employer actions that contravene fundamental state policy. And society’s interests are served through a more stable job market, in which its most important policies are safeguarded. In addition to statutes and constitutional provisions, valid administrative regulations may also serve as a source of fundamental public policy that impacts on an employer’s right to discharge employees when such regulations implement fundamental public policy found in their enabling statutes. An employment relationship where hiring of the employee is conditioned on acceptance of statutorily proscribed terms is not acceptable to courts in California usually.

Moreover, it has potential for bringing serious mischief to the employment sector. Courts cannot expect workers generally to be cognizant of their employee rights and wrongful termination laws in violation of public policy. Courts tend to reject the concept that a worker, compelled by economic necessity to secure employment, can be thus coerced into signing sweeping agreements to not compete with their employers upon leaving the employment in the uninformed hope the agreement will not be enforced by the courts. Companies that fire employees for refusing to sign such agreements may be liable to the employee for wrongful termination in violation of public policy.