Dismissal due to business reasons in the United States of America

AutorThomas C. Kohler
Páginas95-99

Page 95

Introduction

As an introductory note, one should remember in speaking about U.S. labor and employment law that we do not have a "unitary" system of the type one might find, for example, in Germany. Rather, because of the nature of our federal system, we have a mix of state and federal law that conditions the employment relationship. For an outsider (and yes, at times for us!) this can be confusing.

In a number of instances, for example, in the case of minimum wage law, federal law (by Congressional mandate) does not displace state law. State law can supplement federal law by stating higher minimum wage rates.

In other cases, federal law and state law may both provide prohibitions against, e.g., employment discrimination. The complaining individual may elect which system of protections to invoke. For example, federal law states limits on liabilities for discrimination that state law may not have.

Today, employment is regarded as a matter of contract. Contract law is a matter for the states. In the United States, the default rule is, that unless the parties contract otherwise, employment in the private sector is presumed to be on an at-will basis. Broadly speaking, European systems -and perhaps others- put a premium on employment stability. The U.S. puts a premium on capital mobility. This generalization helps to explain some of the diversion one sees between U.S. employment law and the law of other systems.

As a result of the at-will rule, employers are...

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