What is Wrongful Termination?

Wrongful termination is a very big term that covers a lot of different scenarios and circumstances. In general, though, it refers to the termination of an employee's contract of employment in violation of the contract, a written company policy. Wrongful termination is illegal, and if you fire somebody without cause, you can open yourself up to some unwanted legal trouble. Make sure you are familiar not only with the state law but also your company's policies regarding employment before you make any employment decision, as it could become a costly error if you don't.

As already mentioned, there are several different acts that fall under the greater heading of wrongful termination. The following are the most common examples of such:

• Discrimination. It is illegal to fire an employee based on his or her race, sex, nationality, religion, age, or (in some states) sexual orientation.
• Retaliation. It is illegal to fire an employee because he or she has filed a harassment or discrimination complaint. Such a termination is considered a retaliatory action, and is illegal under civil rights laws.
• Refusal to commit an illegal act. If you have ordered an employee to commit an illegal act - hide funds, say, or shred documents - and he or she refuses, it is illegal to fire that employee.
• Failure to follow termination procedures. Most employers of a certain size have a policy in place that describes the conditions under which an employee can be fired, and what procedures must be undertaken. If these written procedures are not followed to the letter, the fired employee may have the right to sue you for wrongful termination.

It's important to know that, in some states, employment alone is considered an employment contract, and that no physical document has to be signed by either party for there to be a legally binding agreement between the two. The terms of this contract may be influenced by your company's employee handbook. If you are an employer, you may want to consider discussing the legality of any employment issues with a qualified employment attorney beforehand, as it can help you avoid the potentially damaging wrongful termination lawsuit. These court cases can drag on for well over a decade, if they go to the top courts. It is definitely better to be cautious in this situation.