At-Will Employment

Meaning & Definition

The term ‘at-will employment’ describes a situation in which either the employer or employee may terminate an employment relationship at any time and for any lawful reason without prior notice. This is the employment model that is mostly found in the U.S., whereas in India, an at-will model does not exist because contracts, labour law and required notice periods regulate employment contracts.

Important aspect of at-will employment:

• Outlines the distinctions between global employment practices and those in India.
• Assists MNCs in appropriately designing HR policies that are applicable to each region.
• Reduces the misuse of terminology used in an Indian offer or appointment letter.
• Outlines the function of employment contracts.
• Notice periods, and assists in reducing employee relations issues and legal liabilities.

Legal Compliance / Policy / Regulation (India):

In India, at-will employment does not exist under legislation.

The employment law of India is determined by:

• Appointment letter and employment contract.
• Act of Shops and Establishments (specific to each state).
• Industrial Disputes Act 1947 (for workmen).

Termination needs to align with due process, notice period and valid reasons. This means that Indian employers cannot use the at-will employment principle to terminate an employee without following due process.