Every country has employment laws that are unique. There are some core concepts that will help you put the U.S. laws into context. It is also helpful to provide examples of some related laws in other countries.
Historically in the United States, employees were all "employees at will," which meant they were not entitled to their jobs and could be hired or fired for any reason. They could also quit at any time for any reason. In contrast, in much of the world, employees are entitled to their jobs.
Over time, legal confines began to erode the U.S. concept of employment at will. What came along first in the 1930s to restrict this concept was a law that allowed employees to get together and create unions. Remember back to the Triangle fires in New York City. The employees had tried to meet with their employer to discuss the horrible and unsafe working conditions at their sweatshops. It was not until after the employees died in a fire, that the NLRA, National Labor Relations Act, was passed to protect employees who want to create and join unions in order to negotiate over their terms and conditions of employment. For the first time, before an employer in the U.S. could fire a union worker, the employer had to show "just cause" for the decision. After the NLRA, additional employment laws began to limit employer actions-laws involving safety, pay benefits, and discrimination.
In addition, laws are not the only concerns employers must have. It is important to understand the relationship between laws, court cases, agreements, and policies and practices. Many people do not understand that all unfair practices may not be illegal. For example, under the strict concept of "employment at will," Ellen Employer can legally fire Ed Employee for wearing the color orange. Basically, in the U.S., an employer can be completely capricious, unless there are some laws, court cases, or agreements that protect the employee.
It is important to try to visualize this concept. Let's start with the laws-in the U.S., there are federal, state, and local employment laws. The laws are mostly overseen by government agencies; the agencies usually have two responsibilities: they must make sure there is compliance with the laws, and they help to implement the laws by issuing official regulations or guidelines and opinions. Remember, the laws protect employees against specific employment practices. For example, the discrimination laws create "protected classes"-race, sex, and national origin are examples of protected classes. However, going back to Ellen Employer and Ed Employee, no matter how unfair, there are no laws that protect employees that wear orange. Thus, in the U.S., the employees are free from illegal discrimination based upon a protected class, not because they are entitled to their jobs. This is why employees in the U.S. complain about "discrimination" when they are fired as opposed to "the unfairness of the decision."
Where do court cases fit into this picture? There are two kinds of court cases. Some court decisions interpret the meaning of a law. An example is the federal law against sex discrimination. There is nothing in the language of that law about sexual harassment, but courts have interpreted the law against sex discrimination to include sexual harassment. A company or employee can go to the courts to challenge the interpretation of the wording of a law or agency regulations and determinations.
A second type of court case occurs when the courts create a theory, sometimes called "common laws." This has caused further erosion of the concept of "employees at will." Courts have recognized "common laws" based on someone asserting an implied agreement with their employer or the employer has done some terrible wrong to the employee. The courts will determine if there is a legal theory to support an employee's claim. An example of court theories are terms like, "wrongful discharge," "implied contract," "invasion of privacy," and "defamation." Court theories are created in state and local legal systems. As a result, many states have their own recognized theories and interpretations of what those theories mean. Similarly, some of the courts in Canada have implied that an employee must have reasonable notice prior to termination.
After putting into context the laws and two types of court cases, the next step is to think about how agreements would apply. Obviously an employer must follow any written agreements made with employees. There are collective bargaining agreements negotiated with unions, and there are also some individualized employee agreements-such as executive agreements that cover the terms of a person's employment. If a written agreement with Ed Employee incorporates he cannot be fired unless there is a business reason, then Ellen Employer would be limited by the terms of the agreement. A legal interpreter of the agreement would not determine that wearing the color orange is a business reason for termination. In some countries, continued employment automatically gives employees "contracts" that entitle them to their jobs and certain benefits.
The question still remains, however: if the are no laws, no court cases-either interpreting the laws or creating theories-and there are no agreements, does an employer need to follow any of its policies and practices?
Say, for example, Ellen Employer in our orange-firing situation has a policy that states all employees will be treated fairly and cannot be terminated without a business justification. Does the employer need to follow this policy? In the U.S., if there are no laws, court cases, or agreements to legally limit Ellen Employer, the policy can be ignored, and Ed Employee can be fired for wearing orange. As long as the employer reserves the right to modify, amend, or change policies, there would be no legal recourse for Ed Employee. Returning to where we started this discussion, this means employees remain "employees at will" except for the limitations set by laws, court cases, or agreements. Suppose Ellen Employer changed a vacation policy so that employees could no longer accrue unused vacation beyond the end of the calendar year. Generally, in the U.S., that is a matter of policy, not law. Some state and local laws allow employees who are terminated to receive any accrued vacation time. Based upon Ellen Employer's policy, most states interpret that Ed Employee would only receive accrued vacation in that calendar year.
While learning about employment laws, there may be a tendency to focus on legal boundaries. What will other employees feel about Ellen Employer changing the vacation policy or firing Ed Employee for wearing orange? "Angry," "worried about their jobs," "unhappy"-any of those adjectives would apply. That's why employee morale must be taken into account, and that is where the human resources professional plays a major role. Even when there are no legal limits, a human resources professional must always remind management that the impact of taking certain actions can also cause productivity losses, and that, too, can lead to a loss at the bottom line. While it is necessary to understand the relationship between laws, court cases, agreements, and policies and practices, and to seek legal advice about employee issues even if there are no legal concerns, it is important for human resources professionals to act as the barometer of employee morale. This means considering the impact of any actions involving employees, even if it will not make the employer legally liable.