Labor: When Laws and Cultures Collide

Most human resources professionals in the United States are quite familiar with the doctrine of employment at will, which allows employers to discharge most employees for any reason or for no reason-- as long as the termination is not the result of unlawful discrimination. To take advantage of the discretion afforded to management by at-will employment-- which typically is articulated as a policy in the employee handbook and is applicable to all who do not have written employment agreements)-- most U.S. employers do not provide employment contracts to the vast majority of their employees, and thus do not limit their ability to terminate employment without notice and without payment of severance to the employee.

In contrast, the at-will doctrine does not exist in most other countries. Throughout Europe, Asia, South America and North America excluding the U.S., most employees at every level have an employment contract and may also enjoy statutory guarantees that if they lose their jobs, they will receive a variety of termination benefits, including severance. Thus, employees outside the U.S. often expect that their employment will continue until they retire--and employers outside the U.S. are often reluctant to hire new employees for the very reason that they take on a lifelong commitment by doing so.

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Barbara Roth

Barbara Roth is a partner at Hogan Lovells. She represents management exclusively in all types of employment litigation and advises clients on...

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