Background: At-Will Employment
Forty-nine of the 50 U.S. states operate under the at will employment doctrine. This says that the employee or employer can end the employment relationship at any time for any reason (as long as it is not a discriminatory reason–i.e., based on race, gender, national origin). This is how the vast majority of employees outside of schools work – i.e., most people do not have employment contracts. The primary exception to the rule is in schools (both public and private) where faculty – and sometimes staff and administrators–have traditionally worked under employment agreements (aka “contracts”).
What’s Different about a Contract?
The primary difference between working under a contract and working on an at-will basis is that, under a contract, the employment relationship is governed by the contract, not the at-will doctrine. Therefore, either party can only end the employment relationship in the way specified in the contract (instead of “at any time for any reason”). Said differently, a contract essentially “guarantees” employment for a certain period of time (usually a year) at a certain pay rate and under certain conditions (regarding job responsibilities, benefits, perquisites, and the like).
What’s Better: Employment At-Will or Contracts
It is ISM’s long-held view that two types of employees should have contracts: (1) the School Head (as the sole employee of the Board), and (2) faculty members. The main purpose of faculty contracts is to “guarantee” that the teacher will be in the classroom for the full academic year—i.e., to avoid disrupting the students’ learning, as well as to provide emotional comfort and job-security to the teacher. ISM does not generally recommend contracts for other members of the administration or staff, as the same “continuity of instruction” issue does not exist for non-faculty. As for what’s better, it isn’t a matter of “better.” Rather, it is a matter of understanding the protections that do or do not exist under each form of employment:
- Contracts
The pluses of contracts–for both faculty and the school–are the emotional comforts, job security, and continuity-of-instruction issues noted above. The downside of using contracts (from the school’s perspective) is that, if the contract is not written properly, it makes it more difficult for the school to break the contract if a mid-year replacement is needed due to poor performance–potentially locking the school into paying the teacher for the full length of the contract even if they release the teacher mid-year. Click here for a more detailed discussion of issues surrounding mid-year cancellation of a contract. - Employment At-Will
The advantages and disadvantages of not providing contracts to faculty members are exactly the converse of the advantages and disadvantages of using contracts. That is, on the positive side, employment at-will gives the school maximum flexibility (i.e., it can replace a teacher mid-year without any financial consequence). The downside of this is that lack of a full-year guarantee removes psychological comfort from the employee (which may have a negative impact on faculty culture as well as individual morale).
Splitting the Difference: Employment At-Will Agreements
In recent decades, many schools have modified their contracts into so-called employment at-will agreements. This has been done in an effort to gain the best of both worlds–i.e., something that looks like a contract (and thus provides the emotional comfort of a contract) while actually providing the school with almost as much flexibility for ending the employment relationship as it would have under employment at-will. While this sounds like an ideal solution, ISM’s HR Consultant, Michael Brisciana, advises against such documents.
It is ISM’s view that such documents are highly misleading to employees. In the first place, employment at-will agreement is a contradiction in terms (i.e., something is either a contract or it is not, or said differently, someone works on an at-will basis or not; it cannot be both at the same time). By providing employees with a document that looks like a contract but, in fact, doesn’t protect employees any more than at-will has the effect of misrepresenting the true nature of the employment relationship to faculty–something that is antithetical to the values of most private-school cultures.
Other Considerations
Future articles will explore key provisions that should be in a well-written contract (i.e., a contract that clearly documents the rights and responsibilities of both parties). For now, if a school is considering moving from contracts to at-will (or vice versa), we recommend that they reflect on the legal/financial obligations attendant to each form of employment, as well as the impact such a change may have on your faculty culture.
