California is an at-will employment state. It means your employer can fire you at any time, for almost any reason or no reason. However, the doctrine does not mean that you have no rights. Even in an at-will state, explicit legal protections exist against wrongful termination. An employer cannot fire you for discriminatory reasons or for reporting illegal activity.

Unfortunately, some employers still cross the line, hoping workers will not push back. Wrongful termination can be hard to recognize, especially when disguised as another layoff or business decision. If you believe you were wrongfully terminated, you may have legal options.

You can report your employer to the California Civil Rights Department (CRD) or file a lawsuit against them in court. While battling a lawsuit for wrongful termination, you will need the insight of a reliable attorney. At Empower Sexual Harassment Attorney, we offer top-notch legal guidance for our San Diego, CA, clients.

An Overview of At-Will Employment in California

Under California Labor Code 2922, employment without a fixed term is presumed to be at will. It means the employer or employee may end the employment relationship at any time, with or without cause or notice. The doctrine exists to provide:

  • Hiring flexibility. It simplifies employment decisions and reduces legal constraints.
  • Economic rationale. It eases labor mobility and contributes to vibrant state employment markets.

However, “at-will” is not absolute. California law and judicial decisions have exceptions to prevent misuse of firing power. While employers may fire at will, they cannot do so for reasons that:

  • Breach of an express or implied contract
  • Violate public policy
  • Are fraudulent, discriminatory, or retaliatory

Recognizing these limits prevents exploitation and fosters fairness in the workplace.

Exceptions to At-Will Employment in California

Most assume that at-will employment allows employers to fire anyone at any time. However, several key exceptions protect employees from unfair or deceptive terminations. They include:

Express Employment Contracts

An express contract is an explicit agreement between an employer and an employee about how and when the employment can end. Although you can make an oral contract, written agreements are much stronger in court. In an express contract, the employer may agree to only terminate someone for a reasonable cause. That means the employer must have a valid reason, like poor performance or misconduct. You can sue for wrongful termination if they terminate you without a valid reason.

For example, if your employment agreement says your employer can only fire you after three warnings, a termination that does not meet the requirement is considered wrongful. Executives, managers, and some high-level employees often negotiate these contracts.

To challenge termination under an express contract, you must prove that:

  • There was a valid agreement.
  • The employer violated its terms.
  • The violation led to harm.

Implied Contracts

Even when no written contract exists, an implied contract can still form based on the employer’s behavior and statements. It happens when:

  • You have worked at the company for a long time.
  • The company has promised you job security.
  • The company follows a straightforward process before firing people.
  • Performance reviews are consistently positive.

A famous case, Foley v. Interactive Data Corp., clarified that even long-term, loyal employees could argue that an implied contract existed. In that case, the court sided with the worker, saying implied promises matter as much as written ones. Key facts that help you prove an implied contract include

  • Company Policies
  • Repeated verbal assurances
  • Written policies in handbooks
  • Long employment without any write-ups

Employers often include disclaimers in handbooks saying all employment is at-will. But if those disclaimers are unclear or contradicted by actions, you can still have a case against them.

Implied Covenant of Good Faith and Fair Dealing

Every California contract has an implied covenant of good faith and fair dealing. This means that both sides must treat each other fairly and not do anything to sabotage the agreement. In employment, the rule stops employers from acting in bad faith. That includes things like:

  • Firing someone before they earn a big bonus or pension
  • Creating fake reasons to terminate a worker they do not like
  • Terminating someone to avoid paying commissions they have already earned

California is one of the few states that recognize this type of wrongful termination. Courts prevent employers from using at-will rules as a cover for unfairness. You must prove these facts to win a lawsuit against your employer:

  • You had a contract or an implied contract.
  • The employer acted in a way that defeated the point of the contract.
  • The termination was motivated by greed, bad faith, or spite.

The courts do not allow employers to benefit from unfair conduct. The rule keeps workplace agreements honest. Additionally, it stops companies from taking advantage of employees.

Fraudulent Inducement

If an employer lies to make you accept a job and then fires you soon after, you may have a claim for fraudulent inducement. Such incidents happen when an employer knowingly makes false promises to convince someone to take or keep a job. If you believe and rely on the employer’s promises, they can cause you to make drastic life decisions like moving across the country.

The elements of fraudulent inducement include:

  • The employer made a false statement.
  • They knew it was false or said it recklessly.
  • You relied on the false statements.
  • You suffered harm as a result.

These cases are fact-heavy. You must present strong proof, like emails, offer letters, or witness statements. If successful, you can recover money for lost wages, moving expenses, and emotional distress.

Government Employees

Government employees in California are not at-will employees. These employees receive protection from civil service rules, union contracts, or statutory job protections. Unlike private-sector workers, government employees often have a property interest in their jobs. That means they are entitled to due process before termination.

Due process includes the right to a hearing, notice of the charges, and a chance to respond. For example, public school teachers, state workers, or police officers must usually go through a disciplinary process before termination. A government agency cannot fire you without explaining why or offering a fair review. Often, these protections are outlined in the California Government Code.

Grounds for Wrongful Termination in California

California is an at-will employment state. That means employers can typically fire workers at any time, for any reason. However, there are important exceptions to this rule. If an employer breaks the law when firing someone, it is considered wrongful termination. The following are common legal grounds for wrongful termination:

Discrimination

It is unlawful for an employer to fire someone based on specific personal traits. These traits are protected under both California and federal law. They include:

  • Race or ethnicity
  • Gender or gender identity
  • Religion
  • Age (40 and over)
  • Disability
  • Sexual orientation
  • National origin

An employer cannot fire workers simply because they are part of a protected group. For example, firing someone because they are pregnant or because of their religion is illegal.

You can file a complaint with the relevant departments if you suffer wrongful termination for discriminatory reasons. They include the California Civil Rights Department (CRD) and the Equal Employment Opportunity Commission (EEOC).

Retaliation

Employers cannot fire an employee for exercising their legal rights. This includes reporting unlawful behavior or participating in a workplace investigation. Common examples of protected actions are:

  • Reporting harassment or discrimination
  • Filing a wage complaint
  • Taking family or medical leave
  • Reporting safety violations
  • Participating in a whistleblower action

You can file a lawsuit for retaliation if you are terminated after making a complaint.

Violation of Public Policy

Another common ground for wrongful termination is if the firing goes against public policy. It means the termination violates a legal principle that protects the public good. For example, an employer cannot fire you for:

  • Refusing to break the law
  • Reporting a crime
  • Serving on a jury
  • Taking time off to vote

Employers who punish workers for following the law or protecting the public may face a wrongful termination lawsuit.

Whistleblower Protections

California has strong laws to protect whistleblowers. These laws apply when a worker reports illegal activities by the employer. They include reporting fraud, unsafe working conditions, or other violations.

Even if the report is wrong, the employee still receives protection if they believe it was valid. Employers cannot fire or punish workers who speak up in good faith. You have a valid lawsuit against your employer if they fire you for whistleblowing.

Breach of Contract

Most workers in California are at-will employees. However, some have employment contracts. These contracts may promise job security or require “good cause” for termination. If an employer breaks the terms of the agreement, it may be grounds for a wrongful termination claim.

Constructive Discharge

Sometimes, an employer does fire the worker directly. Instead, they make the work environment so unbearable that the employee cannot quit. Examples of these incidents can include:

  • Ongoing harassment
  • Demotion without reason
  • Sudden pay cuts
  • Dangerous or hostile conditions

If a court finds the employer intentionally created intolerable conditions to force the employee to resign, it may treat the resignation as a wrongful termination.

Filing a Wrongful Termination Lawsuit in California

California operates on the at-will employment system. It means your employer can terminate you for any reason. Losing your job is stressful, especially if you believe you were fired illegally. California law allows you to file a lawsuit against your employer for wrongful termination. The steps you can follow for your claim include:

Understand What Counts as Wrongful Termination

Not all unfair firings are illegal. California is an “at-will” employment state. This means employers can fire employees for almost any reason or no reason at all. However, there are important exceptions. Wrongful termination can occur if you face termination under these circumstances:

  • Because of discrimination against your race, gender, or sex
  • In retaliation for reporting harassment or illegal activities
  • For taking protected leave
  • In violation of a written employment contract
  • After refusing to engage in unlawful conduct

If your situation fits one of these, you may have a valid case against your employer. You can consult with your attorney if unsure whether your termination counts as unlawful.

Gather Evidence

Before taking legal action, you should collect all relevant documents and information for your case. Common pieces of evidence that can strengthen your case include:

  • Your employment contract or offer letter
  • Performance reviews
  • Emails or texts between you and your employer
  • Witness statements
  • Pay stubs or timesheets
  • A written termination notice, if you received one
  • You should write a detailed timeline of events leading to your termination.

File a Complaint With a Government Agency

If you were fired due to discrimination or retaliation, you may need to file a claim with a government agency before going to court. In California, you can file with:

  • The California Civil Rights Department (CRD)
  • The U.S. Equal Employment Opportunity Commission (EEOC)

These agencies handle claims involving discrimination and retaliation under state and federal law. You must file your claim within one year of the termination for CRD or 300 days for EEOC.

Filing a claim involves filling out an intake form online or in person. The agency may investigate or mediate. Mediation consists of discussing and agreeing with your employer to solve the issue and find a remedy out of court. If you fail to reach an agreement, the agency will issue you a right-to-sue letter, which you will need to file a lawsuit in court.

Consult a Lawyer

Wrongful termination cases are complex. Therefore, you should speak to an employment attorney. A lawyer can help you:

  • Determine if your case is strong.
  • Meet all deadlines for the filings.
  • Navigate agency processes
  • Negotiate a settlement
  • Represent you in court

Many employment lawyers work on a contingency fee. It means you can pay them with the proceeds of your lawsuit.

File the Lawsuit

Your lawyer will file a complaint in the California Superior Court to start your lawsuit. The legal document submitted during the filing explains:

  • Who you are
  • Who your employer is
  • Reason for wrongful termination
  • The laws your employer violated
  • What damages do you seek?

After filing, your employer is served with the complaint. They must then respond within a set time, usually 30 days.

Discovery Process

After filing the lawsuit, both sides gather and exchange information through a process known as discovery. It involves:

  • Written questions
  • Requests for documents
  • Depositions, which are formal interviews under oath

The discovery phase can last several months. It helps both parties prepare for trial or settlement.

Settlement Negotiations

Most wrongful termination lawsuits settle before trial. Settling can save time, money, and stress. Negotiations may happen at any time. The employer may agree to pay compensation, reinstate you, or change specific policies. If you reach an agreement, you sign the documents indicating that you accept the settlement.

Go to Trial

If you fail to reach an agreement out of court, your case may go to trial. A judge or jury can preside over the hearing. Your lawyer will present evidence and argue your case. The employer can also dispute the allegations and present evidence that the termination was lawful.

Employers defend themselves in the lawsuit by:

  • Showing legitimate, non-discriminatory reasons. As part of their defense, employers commonly show that the adverse action was taken for objective reasons. The reasons would be performance issues, misconduct, or attendance problems.
  • Arguing that the timing is coincidental. Your employer may claim that any protected activity by the employee occurred independently of the decision.
  • Asserting no implied contract existed. Employers often rely on handbook disclaimers that state employment is at-will. It helps counter any claim of implied contractual obligations.

After reviewing the evidence, the court decides whether the termination was illegal. Additionally, a judge determines the compensation benefits you can recover. Trials can take several days or weeks and are usually the last resort.

Post-Trial Motions and Appeals

You do not have to accept the court’s decision in your lawsuit. You can appeal the decision by filing a petition in the appeals courts. Your attorney can help you take the result or pursue further legal action.

Compensation Benefits in a Successful Wrongful Termination Lawsuit in California

California has strong protections for employees. If you win a wrongful termination lawsuit in California, you are entitled to several types of compensation. These benefits make up for the losses you suffered due to wrongful termination. They include:

Lost Wages

Wrongful termination can cause you to miss weeks or months of work. Lost wages are a common compensation you will recover from wrongful termination. It includes the money you would have earned without being terminated. Courts consider past lost wages from when you were fired until the judgment. Additionally, it can factor in future lost wages, which cover income you would likely have earned going forward.

Lost wages include base pay, commissions, bonuses, overtime, and potential raises. If you had to take a lower-paying job after termination, the court may award you the difference between the two incomes.

Lost Employment Benefits

Being terminated often means losing valuable benefits in addition to your paycheck. If you win your case, the court may also award compensation for those. These benefits might include:

  • Health insurance
  • Dental and vision coverage
  • 401(k) or pension contributions
  • Paid vacation and sick leave
  • Life or disability insurance
  • Stock options or equity

The court gives a dollar value to these benefits and adds it to your total compensation.

Emotional Distress Damages

Wrongful termination can result in intense emotional suffering. If you suffered stress, anxiety, depression, or any other emotional pain as a result of the termination, you are entitled to recover damages. Emotional distress damages do not require a physical injury.

It is essential to show the true, serious nature of the emotional harm. You could provide evidence such as a therapist, a doctor, or testimony. The greater the severity and duration of the distress, the larger the expected award.

Punitive Damages

Sometimes, the court may also award you punitive damages. These are not meant to pay you back for a loss but to punish your employer for unlawful behavior. A judge can only grant you these benefits if your employer acted with malice, oppression, or fraud.

For example, you may qualify for punitive damages if fired for reporting illegal activity or standing up against discrimination. These damages are much larger than your actual losses, and they discourage future misconduct.

Attorney’s Fees and Legal Costs

You will need expert legal insight when pursuing a lawsuit for wrongful termination. Under California law, you may recover attorney’s fees and court costs if you win a wrongful termination case. Legal fees are often high, and this rule makes it easier for everyday employees to take legal action, even if they lack enough money to pay a lawyer upfront.

Reinstatement

The court may order your employer to reinstate you to your former position. It means you would regain your job if wrongful termination had never happened. Reinstatement is more likely in cases involving public employment or strong whistleblower protections.

However, the reinstatement is not always practical. Returning to work is not feasible if the workplace is hostile or the relationship is too damaged. Instead, the court may award financial compensation.

Interest on Damages

You are entitled to interest on the damages you receive in a wrongful termination lawsuit. The money is added to your compensation to account for the time since you filed the claim. It helps ensure you recover maximum compensation for the delay in receiving compensation.

Find a Reliable Sexual Harassment Attorney Near Me

At-will employment allows employers to make hiring and termination decisions. However, it does not give them the right to break the law. You can claim unlawful termination if you were fired for an illegal reason, like discrimination, retaliation, or refusing to do something unethical.

If you are a victim of such actions, you can report to the California Civil Rights Department (CRD) or the U.S. Equal Employment Opportunity Commission (EEOC). After reporting the incident to the CRD or EEOC, they will give you the right to sue, which allows you to file a lawsuit against your employer. In a successful lawsuit, you can recover compensation for lost wages, employment benefits, and emotional distress. Sometimes, the court can order your reinstatement.

Navigating the laws on at-will employment and wrongful termination in California is challenging. You will need our expert legal guidance and representation at Empower Sexual Harassment Attorneys if you are filing a wrongful termination lawsuit. Contact us at 619-604-3027 from San Diego, CA, to discuss your case.