In the United States, there are two types of employment terminations, “for cause” and “without cause” termination. This has stemmed from the fact that many U.S. states, including New York, have what’s called at-will employment. This is where employers can fire an employee at any time, for any reason so long as the reason isn’t illegal, such as out of discrimination, retaliation, or to cover up illegal activity.
With less than 15 states not having at-will employment, this has led to job security not being at its strongest. Employees can be fired at any time and employers do not have to give a reason. While they don’t have to have a reason, they can’t have an illegal one. Here’s where at-will employment can be confusing. While at-will employment does empower employers to fire at-will, the fact that they don’t have to give a reason often leads to terminated employees accusing them of firing people for illegal reasons. It’s understandable for many people to assume that an employer isn’t saying the reason because the reason is illegal. This is where it’s important to know the difference between “for cause” and “without cause” termination to avoid confusion.
As an employee, it is essential to understand your rights in such situations and know the legal difference between a “for cause” and “without cause” termination. The employee rights attorneys at Bantle & Levy explain the meaning of these terms, their implications, and how you can protect yourself in case of either type of termination.
What is a “For Cause” Termination?
A “for cause” termination refers to an employment termination that occurs due to specific reasons outlined in an employee’s contract or company policies. These reasons may include gross misconduct, repeated performance issues, and violation of company policies. Since these reasons are explained somewhere in the employer’s documents, “for cause” terminations can avoid a lot of lawsuits. It’s hard to accuse an employer of wrongful termination when they have legal reasons in their contracts to point to. At the same time, it becomes more obvious when they’re lying because you may be able to argue against these reasons.
Thus, to terminate an employee “for cause,” the employer must provide evidence that the employee somehow failed to do or did something that broke their contract. In “for cause” termination, the burden of proof lies with the employer. Once the employee starts questioning their reason, they must be able to justify it.
What is a “Without Cause” Termination?
On the other hand, a “without cause” termination is when an employer decides to terminate an employee without giving a specific reason. In these cases, the employer does not have to provide proof or justification for their decision when the employee challenges it, hence why many employers opt for this type of termination. However, this does leave them vulnerable to an employee’s accusations, and a legal defense will eventually have to give a reason, which begs the question of why they wouldn’t give one in the first place.
One reason why an employer would utilize a “without cause” termination is because of their employment contracts. If an employer doesn’t want to have to abide by the agreed-upon reasons they considered putting in their employment contract, they have to forgo many “for cause” termination options. This gives them the flexibility to make changes in their workforce as they see fit.
However, this does not mean that employers can terminate employees without any consequences.
Implications of a “For Cause” Termination
Being terminated “for cause” can have serious implications on an employee’s future employment prospects. This type of termination is often viewed as a red flag by potential employers and may harm the employee’s professional reputation.
Implications of a “Without Cause” Termination
While a “without cause” termination does not require justification or proof from the employer, it still has implications that employees should be aware of. There’s a far greater likelihood of an illegal reason being behind your termination if they don’t say why, but at the same time, they’re likely to offer you some kind of incentive and not damage your reputation.
In most cases, employers will offer severance pay to employees who are terminated “without cause.” This is a form of compensation for the sudden loss of employment and can help employees during their job search.
Additionally, employees may be entitled to other benefits such as continued healthcare coverage or outplacement services.
Protecting Yourself in Case of Termination
It is essential to protect yourself and your rights as an employee. If you are facing a “for cause” termination, review your contract and company policies carefully. This will help you determine if your termination was just or unjust. If you are unsure, you should seek legal advice from an employee rights attorney at Bantle & Levy.
In case of a “without cause” termination, be sure to understand the terms of your severance package and negotiate if necessary. Our attorneys can help you understand how the terms of your severance package works, and negotiate if necessary. It is also crucial that you sign a written agreement that outlines the terms of your termination and any benefits you are entitled to.
Contact the Employee Rights Attorneys at Bantle & Levy
Understanding the legal difference between a “for cause” and “without cause” termination is crucial. It’s how you can protect your rights and navigate unexpected job terminations. If you believe your termination was unfair or unjustified, do not hesitate to seek legal advice from experienced employee rights attorneys like those at Bantle & Levy. Contact us today.