You’re a small business owner, and you only have around a dozen employees. Even so, you are always looking for ways to improve. You identify an employee who needs to be replaced and you tell them that you’re terminating their position. You feel bad, but this is your business, and you have to put it above everything else. You assume that’s the end of the matter.
Then your employee disputes it. Maybe they say you needed to give them some sort of warning before firing them. Maybe they demand to know the reason for the firing. What obligations do you have here?
Do they need a warning?
First of all, you do not owe your employee a warning unless they have a contract saying they’ll get one or you have a company policy guaranteeing all employees that same courtesy. In the absence of those two contingencies, you have hired your employee as an at-will worker. This means you can hire or fire them whenever you want, and they can also quit whenever they want. There are no legal obligations to do anything else. They may not be happy to find out so suddenly, but that does not violate state employment laws.
Do they need a reason?
Secondly, at-will employment also means you don’t need a reason and you don’t need to tell them why you’re doing it. You can if you want — maybe they aren’t as productive as your other workers — but you do not have to, even if they ask.
The only issue that can arise here is if you have violated their rights in firing them by doing it for an illegal reason. For instance, racial discrimination is illegal, so you cannot fire someone because of their race. But that doesn’t mean you have to have some other, more valid reason. You could have no reason at all. You just can’t do it for illegal reasons.
Disputes like this put a strain on your company. Be sure you understand your legal options.