One of the most significant aspects of American common law is the concept of "at-will" employment. The term "at-will" denotes the employer's ability to terminate the employment relationship between the company and any employee, without reason or prior notice. It also allows the employee to do the same. This long-standing rule would undergo significant revision in the 1970s. These changes would be codified into the Termination of Employment Act.
- Many aspects of American common law are derived from attempts to prevent grievances that the early colonists had against the British empire. The doctrine of "at-will" employment prevents any employee from being held in service to a private entity unless a formal employment contract is in effect. This rule remained in force in America to the early 1970s. At that time, legal suits against employers for wrongful termination begin to flood the courts in nearly every jurisdiction of the country. In 1991, the Uniform Law Commissioners proposed the Model Employment Termination Act (META).
- META, also known as the termination of employment act, states that any qualified employee may not have his employment terminated without "good cause." A "good cause" is defined as either the employees' inadequate or improper performance of the job or if discharging the employee will promote the economic or institutional goals of the employer.
- For the employer, the relation of employment act offers a clear route to reduce the work force when necessary without facing costly litigation. For the employee, it offers a defense against termination due to discrimination, abuse of power, and as a means of intimidation or retribution. META offers remedies that may include reinstatement of employment, back pay, lost benefits or a lump sum severance. In addition, attorney's fees are recoverable. This allows employees with lower income an ability to afford to bring a legitimate claim against an employer.
- Since the mid-1990s, there has been a gradual reduction in cases of employment discrimination and institutional abuse of power. Many attribute this to the success of the termination of employment act. Most major corporations have developed and implemented programs and workshops to educate management and human resource personnel on recognizing a "good cause" for termination of an employee as well as when META applies and when it may not.
- Although the term "qualified employee," is defined as "any works for higher," not all employees are covered by META. Firms with less than five employees are not covered under META. META does not offer punitive damages or awards for pain and suffering for an act of wrongful termination. However, it does allow for punitive damages against the employer that commits acts of retaliation against any employee that files a wrongful termination claim. Also, many claimants don't realize that all wrongful termination awards are determined by arbitration and not by a jury. A judicial review of the award can be made, however, if the arbitrators are found to have committed certain abuses of power or discretion.
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