The American Rule that Swallows the Exceptions

Abstract:     
The "American" rule of employment at-will cripples the effectiveness of the two most important exceptions to that doctrine, the National Labor Relations Act and Title VII. Scholars often cite at-will as an area in which exceptions swallow the rule but ignore the opposite effect the rule has in undermining rights widely viewed as fundamental. This article goes beyond the standard critiques of the NLRA and Title VII and uses two other areas of law to make this case. The impact of at-will on private sector labor rights under the NLRA is shown by comparing public sector employment. Public sector labor law has all the flaws scholars have identified in the NLRA, yet public employees are organizing much more successfully. The crucial difference is that most public workers are not employees-at-will. For employment discrimination, the article compares rules governing claims of discrimination in juror selection under the Supreme Court's decision in Batson v. Kentucky. Batson rules are identical to Title VII rules, and have been so ineffective that scholars and a Supreme Court Justice have suggested that all juror strikes should be done for cause, the equivalent of requiring cause for discharge from employment.

The article then balances the at-will rule against the exceptions it undermines. From the inception of the rule, there have been many attempts to create exceptions to it. Today, numerous, small, and often unclear inroads have been made. This makes the rule less useful to both sides, offering uncertainty to employers yet scant protection to employees. At the same time, the cost of at-will is the lack of effective labor and anti-discrimination regimes. Scholars and policy-makers should understand this cost when debating labor law, antidiscrimination law, and the future of the at-will doctrine.

Keywords: Labor Law, Public Sector Labor Law, Employment Discrimination, At-Will Employment, Employment Law, Title VII

JEL Classifications: J5, J7

Working Paper Series