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What are my legal obligations as an employer if I want to terminate an employee in California?

Picture of Chris Battis By   ·  1 minute read

As an employer in California, you have legal obligations to follow when terminating an employee. Here are some of the key legal requirements that you should be aware of:

  1. At-Will Employment: In California, most employment is considered “at-will,” which means that you can terminate an employee at any time and for any reason, as long as the reason is not discrimination or retaliation. However, it is always advisable to have a valid reason for termination that is based on poor performance or misconduct documented in writing in case a legal challenge arises.
  2. Equal Employment Opportunity Laws: Under California law, you cannot terminate an employee based on their race, national origin, gender, religion, age, disability, or sexual orientation, among other protected classes. If an employee feels they have been wrongfully terminated based on one of these characteristics, they can file a discrimination lawsuit against the employer. Make sure to have proper documentation of the reason for termination to avoid any claims.
  3. Proper Notification: If an employee is covered under the federal Worker Adjustment and Retraining Notification (WARN) Act, which applies to businesses with at least 100 full-time employees, you must provide them with a 60-day notice before terminating their employment. California also has a mini-WARN act that applies to businesses with at least 75 employees. However, if the termination is due to a sudden business circumstance, such as a natural disaster or unforeseeable economic situation caused by Covid-19, then these requirements may not apply.
  4. Final Wages: When terminating an employee, you must provide them with their final paycheck on the day of termination or within 72 hours of the notice of termination. This includes any unused vacation time, commission, or other payments owed to the employee.

In general, when terminating an employee, it is essential to act professionally and respectfully to avoid potential legal issues. In the event of a legal challenge, seeking the assistance of a licensed attorney is recommended.