Most employees in the United States work "at will." This means that you can fire them at any time, for any reason, unless that reason is illegal. State and federal laws prohibit employers from relying on certain justifications for firing employees, such as discrimination or retaliation. These prohibitions apply whether the employee has an employment contract with you or works at will. (To learn more about additional limitations on firing employees with employment contracts, see Nolo's article Firing Employees With Employment Contracts.)
This article provides an overview of the most common illegal reasons for firing employees. For detailed information on whether and how to fire an employee (including a checklist that will help you make sure you've considered all the legal angles), get a copy of Dealing With Problem Employees, by Amy DelPo and Lisa Guerin (Nolo).
Federal law makes it illegal for most employers to fire an employee because of the employee's race, gender, national origin, disability, religion, genetic information, or age (if the person is at least 40 years old). Federal law also prohibits most employers from firing someone because that person is pregnant or has a medical condition related to pregnancy or childbirth. To find out if your business is covered by these federal laws, see Nolo's article Federal Antidiscrimination Laws.
Most states also have antidiscrimination laws that prohibit firing for all of the reasons listed in the federal law. Many state laws include additional prohibitions (for example, some state laws prohibit discrimination on the basis of sexual orientation or marital status), and they cover a wider range of employers. To learn more about your state's antidiscrimination laws, see Nolo's articles Employment Discrimination in Your State.
It is illegal for employers to fire employees for asserting their rights under the state and federal antidiscrimination laws described above. An employee can bring a retaliation claim even if the underlying discrimination claim doesn't pan out. For example, if you fire an employee for complaining that you denied a promotion because of race, you could lose a retaliation lawsuit even if a judge or jury finds that your promotion decision was not discriminatory. To learn more about retaliation, see Nolo's article Preventing Retaliation Claims by Employees.
The federal Employee Polygraph Protection Act prohibits most employers from firing employees for refusing to take a lie detector test. Many state laws also set out strong prohibitions against using lie detector tests.
The federal Immigration Reform and Control Act (IRCA) prohibits most employers from using an employee's alien status as a reason for terminating employment, as long as that employee is legally eligible to work in the United States. To find out more about the IRCA, see Nolo's article Federal Antidiscrimination Laws.
The federal Occupational Safety and Health Act (OSHA) makes it illegal for employers to fire employees for complaining that work conditions don't meet state or federal health and safety rules.
Most states prohibit employers from firing an employee in violation of public policy -- that is, for reasons that most people would find morally or ethically wrong. Of course, morals and ethics can be relative things, so the law varies from state to state. A termination decision that might be allowed in one state might be prohibited in another.
Despite this relativity, most states agree that the following reasons for termination would violate public policy and would therefore be illegal:
Despite following these guidelines, you might still fear being sued for wrongful termination after you let an employee go. You can protect yourself by asking that employee to sign a "release," or agreement not to sue. For more information, see Nolo's article Using Severance Agreements to Avoid Lawsuits.