In many employment situations, the law generally considers the employment relationship to be terminable at the will of either party. That is, an employer may terminate an employee at the will of an employer, while an employee may quit at any time. When either of these events occur, the party that ends the relationship is not liable to the other, even if this termination causes damage to the other party. This type of relationship is termed employment at-will.

Although rules governing at-will employment remain largely intact today, courts and legislatures have crafted some exceptions to these rules. Some of these exceptions apply when the employer and the employee have entered into a contract. Other exceptions apply when the discharge violates a mandate of public policy or when an employer violates a duty to exercise good faith and fair dealing with the employee. Though these exceptions do not prohibit an employer from terminating an employee, they will allow the employee to recover damages. Individual states vary regarding protections offered to employees in an at-will employment relationship.

The United States remains the only major industrial power that adheres to the at-will employment doctrine. Other nations, including Great Britain, France, Italy, Germany, and Japan, each have statutes that require employers to show good cause before the employers can terminate employees.