What are the Legal Reasons to Fire an Employee?

Terminations can be tricky. This article outlines what you can legally fire an employee for.

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The top reasons to terminate an employee

Let’s say you have an employee that is no longer conducive to your company goals. Do you have to have a valid reason to let them go? Do you have to tough it out until they give you a reason?

While it varies from state to state, there are actually very few illegal reasons to fire an employee, most of which have to do with discrimination. But if you want to let someone go — and it has nothing to do with demographics, sexual orientation, medical reasons, or other discrimination — then below are some legal reasons you can do so.


Simply put, you hire employees to adhere to certain performance levels. It’s what you pay them for, and it’s what drives a business forward. If you’re upholding your end of the bargain compensation-wise, but an employee is adhering to predetermined benchmarks, you have a legal right to fire them.

A best practice here — and to avoid legal implications — is to clearly communicate performance benchmarks in job descriptions, host periodic performance reviews so they know/have a warning when they’re underperforming, provide ample warnings, and to make the case for firing them by having specific metrics or poor performance indicators in case they want specifics.

Violating company policy

As part of the onboarding process, a company should have a comprehensive company policy that outlines what they will and will not tolerate within the workplace. Typically, company policy will outline technology/equipment policies, sexual harassment policies, drug and alcohol policies, and dress code, among other items.

While a company policy is typically specific to every organization, it’s a way to clearly set consequences and punitive action (including termination) that can be taken should an employee violate a clause of the policy. If an employee signs it (as they usually do) then you have a legal right to fire them.


For the same reason you can legally fire an employee for poor performance, which also includes having a terrible attitude. A bad attitude is a major hindrance to team performance and company objectives.

An employee has a bad attitude when they’re negative at work, are combative and confrontational, are disrespectful toward coworkers and managers, are spreading false information, or exhibit any other sort of behavior that disrupts a successful workplace.

You’ll first and foremost want to notify that employee of the effects of their behavior. To avoid legal trouble, have a meeting with the employee and have HR sit in as you discuss their poor behavior. HR should make a record of the conversation.

If it continues, have another meeting with them, but this time let them know that they are on a 30-day probationary period. In which case, they have 30 days to improve their behavior or they face termination. Have them sign a document stating that they understand. Throughout the next 30 days, it will be your job as the manager to monitor their behavior. Once they exhibit the same behavior (it helps to record it) you have a right to fire them.

No reason

Some states allow “Fire at Will” in which you legally don’t have to give or provide a reason to fire an employee — you can do so at any time without having to tell them why. If they suspect that it has something to do with discrimination, they may take legal actions, in which case you might want to prepare evidence against their allegations.

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