Opinion ID: 2516473
Heading Depth: 3
Heading Rank: 1

Heading: The At Will Employment Doctrine

Text: In the mid-nineteenth century, [e]merging notions of the freedom of contract and of the value of economic growth contributed to the evolution of the at-will doctrine, which recognizes an employer's right to discharge for good cause, for no cause or even for cause morally wrong[.] Parnar v. Americana Hotels, Inc., 65 Haw. 370, 374-75, 652 P.2d 625, 628 (1982). The at-will doctrine became known as the American rule and has long governed terminations of the employer-employee relationship. Id. at 375, 652 P.2d at 628 (citing Greer v. Arlington Mills Mfg. Co., 43 A. 609 (Del.Super.Ct.1899); McCullough Iron Co. v. Carpenter, 67 Md. 554, 11 A. 176 (1887); Martin v. New York Life Ins. Co., 148 N.Y. 117, 42 N.E. 416 (1895)). By the beginning of the twentieth century, the employer's right to discharge for good cause, for no cause or even for cause morally wrong was absolute. In recent years, however, Congress and the legislatures of many states have enacted legislation to protect employees from the whims of employers. Nevertheless, absent a collective bargaining agreement, a contractual provision, or a statutorily-conferred right which reduces the likelihood of abusive or wrongful discharge, the at-will doctrine prevails. Parnar, 65 Haw. at 375, 652 P.2d at 628 (footnote omitted) (emphasis added). The principle that the at-will doctrine prevails absent a collective bargaining agreement, a contractual provision, or a statutorily-conferred right has remained untouched in this jurisdiction since this court's decision in Parnar. See, e.g., Best Place, Inc. v. Penn America Ins. Co., 82 Hawai`i 120, 124 n. 5, 920 P.2d 334, 357 n. 5 (1996); Ross v. Stouffer Hotel Co., 76 Hawai`i 454, 463-64, 879 P.2d 1037, 1046-47 (1994); Kinoshita v. Canadian Pacific Airlines, Ltd., 68 Haw. 594, 600, 724 P.2d 110, 115 (1986); Smith v. New England Mut. Life Ins. Co., 72 Haw. 531, 553, 827 P.2d 635, 645 (1992); Smith v. Chaney Brooks Realty, 10 Haw. App. 250, 257-58, 865 P.2d 170, 173 (1994). We therefore reaffirm the general principle that, in the absence of a written employment agreement, a collective bargaining agreement, or a statutorily-conferred right, employment is at-will. Such at-will employment is, by definition, . . . terminable at the will of either party, for any reason or no reason at all. Best Place, 82 Hawai`i at 124, 920 P.2d at 357 (1996). As such, parties to an at-will employment contract enter into the contract with full knowledge that the employment is for an indefinite duration and can terminate at the will of either party. Id. Correlatively, an employment contract of indefinite duration will generally be construed as giving rise to an at-will employment relationship and as therefore terminable at the will of either party for any reason or no reason. Parnar, 65 Haw. at 374, 652 P.2d at 627 (citing 9 S. Williston, Contracts § 1017 (3d ed.1967); Annot., 51 A.L.R.2d 742 (1957)); see also Vlasaty v. Pacific Club, 4 Haw.App. 556, 564, 670 P.2d 827, 833 (1983).