Can an employer fire or layoff employees without giving a reason? Ask HR

Johnny C. Taylor Jr. tackles your human resources questions as part of a series for USA TODAY. Taylor is president and CEO of the Society for Human Resource Management, the world's largest HR professional society and author of "Reset: A Leader’s Guide to Work in an Age of Upheaval.”

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Question: Though I have had positive feedback on my performance since starting my job, I was recently laid off for performance reasons. In fact, this is the first time I've been singled out for substandard work, and they didn't provide any specific detail on the standard or my work. Are employers required to give a reason for a layoff? Do I have any recourse if they provide a false reason? – Maya

Answer: I am genuinely sorry to hear about your recent layoff. It must be incredibly jarring to learn about perceived substandard work for the first time in the midst of being laid off. Unfortunately, I don't have the best news for you. While there are some states where your employer may be required to provide an explanation pursuant to state law, an employment contract, or a collective bargaining agreement, generally speaking, employers can terminate your employment for any nondiscriminatory reason and they don't have to give you the reason.

Layoffs are often driven by broader business pretexts, such as cost-cutting or organizational restructuring, and may not necessarily reflect on the performance of individual employees. Employers should utilize nondiscriminatory criteria when conducting layoffs, considering factors like seniority, job skills, and performance. It is worth noting that employers must also avoid discrimination and ensure fair treatment in the selection process.

You may have legal recourse if you suspect the layoff decision was discriminatory or based on false reasons. Unlawful reasons for layoff can include factors like pregnancy, age discrimination (for those 40 or older), or issues related to religion or disability. You may also have legal options if the layoff occurred because you exercised your rights to certain employment protections, such as workers' compensation or paid sick leave.

Before considering legal action, I recommend contacting your former human resources department to gather more details about the layoff. Understanding the specific reasons behind the decision can provide clarity. Additionally, you may contact the Equal Employment Opportunity Commission, the government agency responsible for enforcing workplace discrimination laws, to discuss your situation.

There is a marked difference between illegal and poor business conduct. While you have recourse when impacted by an unlawful employer action, your options are limited when such employer behavior falls short of being illegal. Though a layoff may hurt in the short term, in the long run, you'll be better off in an employee-employer relationship based on mutual respect.

I sincerely hope you have found new opportunities since your layoff. If you are still in the job market, I wish you the best of luck in your search for stable and meaningful work.

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A graphic design company just offered me a new job, and I'm leaning toward taking it, but they don't offer any health insurance benefits. Is that legal? – Dorian

Congratulations on receiving a job offer. That's fantastic news. Regarding your concern about health insurance benefits, whether it's legal for an employer not to offer them depends on certain factors.

If the company has fewer than 50 full-time employees, they are not subject to the Affordable Care Act, which mandates employers to provide health care benefits or face penalties. For smaller businesses, offering health insurance may be challenging due to budget constraints. In 2023, the average health benefit cost per employee was $13,800, making it a significant expense. Providing such benefits might only be feasible for a smaller employer or startup with limited resources once they grow and become more established.

On the other hand, if the graphic design company has more than 50 full-time equivalent employees, they fall under the ACA regulations and may choose to offer health insurance or pay a penalty to the IRS. The penalty for 2024 is $2,970 per full-time employee (minus the first 30 full-time employees), which is substantially less than the average cost of health care.

If health insurance is a priority for you, there are options available. Many health insurance companies offer standalone plans for individuals and families. Additionally, you can explore purchasing health insurance through HealthCare.gov or your state exchange. I recommend comparing different options to find a plan that fits your budget.

Ultimately, if this job opportunity excites you and aligns with your career goals, don't allow the absence of health insurance benefits to be the sole deterrent. Alternative solutions are available to ensure you have the coverage you need while pursuing this exciting opportunity.

Best of luck in your decision-making process, and I hope this new job brings you fulfillment and success!

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