Arizona Employment Protection Law and the At-Will Employment Relationship

Arizona employers and employees have an “at-will” relationship, which means employers are free to fire employees without notice or reason, and employees are free to resign at any time without notice or reason . Of course, the at-will employment relationship is subject to the obligation of both parties to comply with other legal requirements, including contractual duties and compliance with various federal and state anti-harassment and discrimination laws.

To reduce the amount of wrongful termination and related litigation, the Arizona legislature enacted the Arizona Employment Protection Act in 1996. The Act established certain guidelines designed to clarify what constituted and did not constitute wrongful termination under Arizona law. Prior to the enactment of the Arizona Employment Protection Act, employers faced numerous laws based on alleged oral promises and implied obligations, with mixed results depending on judge or jury. Several of those results served to expand an employee’s right to sue in ways the legislature found unacceptable.

The Arizona Employment Protection Law contains at least four important provisions that all Arizona employers and employees should be aware of:

First, there is a one-year limitation period for claims for breach of an employment contract or unfair dismissal. This means that such claims must be filed within one year of the termination date, significantly shortening the six-year contract limitation period that previously applied to some claims. Significantly, however, this limitation period does not apply to claims under the Arizona Civil Rights Act or under federal law arising out of unlawful discrimination due to, among other things, race, sex, disability or age.

Second, there is an established presumption that employment relationships can be terminated at will, and that presumption will prevail unless there is an express written agreement to the contrary. Typically, this will require a written contract signed by both parties, or an unequivocal guarantee outlined in an employee handbook or handbook.

Third, the Arizona Employee Protection Law limits wrongful termination claims of employees to express claims of breach of contract (described above), claims specifically permitted by Arizona statute, and improper “public policy” claims. It is important to note that even these claims are limited to cases where the law in question does not itself provide for relief. Improper claims involve circumstances in which an employee is fired for refusing to break the law, or sues an employer who believes they are breaking the law.

Finally, the Act expands sexual harassment complaints so that certain sexual harassment complaints may be filed even when federal sexual harassment laws do not apply.

At the end of the day, the Arizona Employment Protection Act creates a legal environment in which it can be very difficult to successfully bring a claim against an Arizona employer. Of course, every situation is different and the law is constantly changing, and if you believe your rights have been violated or you have been accused of misconduct, you should speak with an experienced Arizona employment lawyer to determine what your rights and obligations are.