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When does an at-will employee have an implied contract?

California is an at-will employment state. That means that most employees can quit for any reason at any time and the employer cannot do anything about it. This also means that the employer can fire an employee for almost any reason at any time as well. However, there are some restrictions on employers and they cannot fire employees for discriminatory reasons or as retaliation for reporting illegal activity or participating in investigations.

There is one basic exception to the at-will employee status. This is in situations where the employee has a specific employment contract which states that they are hired for a specific period of time. Usually these contracts also outline the process for firing an employee prior to that time period expiring.

These types of contracts are not common though, but many employees do sign an employee handbook or similar type contract agreeing to abide by certain conditions. In most of these situations though, the contract specifically states that the employee is an at-will employee still.

However, the employee could potentially have entered into an implied contract, which states the specific process for firing an employee. In these situations, the employee may have a wrongful termination claim if they are fired contrary to the terms of the implied contract. An example is if the employee handbook states terms for firing for cause and those have not been met when they were fired, then the employee may have a claim.

Many employees in California have signed employee handbooks or similar contracts as part of their employment. While this by itself does not mean the employee is not an at-will employee, it could create an implied contract depending on the circumstances. These are very fact-specific matters though. Each one must be specifically analyzed to determine if there is an implied contract. Experienced attorneys understand these matters and may be a useful resource.

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