In addition to specific statutes protecting whistleblowers, many state courts have enunciated a public policy exception for whistleblowers to the at-will employment doctrine which allows employees who are not under contract to be dismissed by their employers at any time.

The public policy exception for whistleblowers usually holds that employers should not be able to use their power as employers to subvert public policy as established by the legislatures or the courts. Employees who are fired, demoted, or harassed for refusing to violate a law, rule or regulation, or who report a violation of such, can sue their employer under this theory.

State courts can read this public policy exception either narrowly or broadly, depending on the particular court. More conservative courts may insist on showing the act of the employer caused actual harm to the public interest before allowing a public policy exception. But some state courts will award punitive damages if they find a strong public policy violation.