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Employment law

termination of employment

Most states follow the employment-at-will doctrine, and employment for an indefinite term may be terminated at will and without cause. Absent a specific contract term to the contrary, this doctrine allows an employee to quit or be terminated without liability on the part of the employer or the employee, with or without cause.

A discharged employee who asserts that the parties have contractually agreed to limit the employer’s right to terminate the employee at will has the burden of proving an express agreement or written representation to that effect. To rebut the presumption of employment at will, an employment contract must directly limit—in a meaningful and special way—the employer’s right to terminate the employee without cause.

In an employment-at-will situation, an employee policy handbook or manual does not, by itself, constitute a binding contract for the benefits and policies stated unless the manual uses language clearly indicating an intent to do so. In those cases holding that personnel manuals may create contractual rights, there is either language in the manuals expressing contractual intent, or the manuals were complemented by oral agreements making the policy provisions binding.

Thus, to prove a claim for wrongful discharge in breach of an employment agreement, a plaintiff must prove (1) the plaintiff had an enforceable employment agreement that directly limited—in a meaningful and special way—the employer’s right to terminate the employee without cause; (2) the plaintiff performed, tendered performance, or was excused from performing the contractual obligations; (3) the defendant breached the contract by wrongfully discharging the plaintiff from employment; and (4) the defendant’s breach of the employment contract caused the plaintiff damage.

The employment at will doctrine does not permit an employer to discriminate against an employee in violation of state or federal law, including Title VII of the Civil Rights Act of 1964 (42 U.S.C. §2000e); the Age Discrimination in Employment Act of 1967 (ADEA) (29 U.S.C. §621); and the Americans with Disabilities Act of 1990 (ADA) (42 U.S.C. §12101).

In Texas, as in most states, the employment-at-will doctrine is the default rule, meaning that either the employer or the employee can terminate the employment relationship at any time for any reason, or for no reason at all, without facing legal liability. This applies unless there is a specific contract that states otherwise. For an employee to overcome the presumption of at-will employment, they must demonstrate the existence of an express agreement or written representation that meaningfully limits the employer's right to terminate without cause. Employee handbooks or manuals typically do not create a binding contract unless they contain language that clearly shows an intent to offer contractual rights, sometimes supported by oral agreements. To establish a wrongful discharge claim, an employee must prove the existence of an enforceable employment agreement that restricts the employer's termination rights, fulfillment of their own contractual obligations, a breach of contract by the employer through wrongful termination, and damages resulting from the breach. However, the at-will employment doctrine does not allow employers to discriminate unlawfully against employees, and they must comply with federal anti-discrimination laws such as Title VII of the Civil Rights Act, the ADEA, and the ADA.

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