Whether or not a temporary layoff is legal depends on various circumstances. Generally, most states observe the “at-will” employment doctrine. This legal concept gives employers the power to hire and fire employees at will, as long as the reason for hiring or firing them is not illegal. So when an employer decides to temporarily lay off their employer, in most cases, it is usually within their rights.
However, there's a thin line between a legal temporary layoff and an illegal one. To put things into perspective, we'll discuss examples of illegal temporary layoffs.
When a Temporary Layoff Is an Act of Retaliation
Most employers know that it is illegal to retaliate against employees for participating in various protected activities in the workplace. For this reason, some rogue employers may use a temporary layoff as an excuse to retaliate against certain employees. They do this knowing that such employees cannot take legal action against employers for laying them off temporarily.
As discussed earlier, most states follow the “at-will” employment doctrine, meaning employers are legally allowed to hire or fire employees just as long as the reason for making such a decision isn't illegal.
A rogue employer may want to use a temporary layoff as an excuse to retaliate against you for participating in protected activities such as:
- Offering to cooperate in ongoing investigations about the employer
- Refusing to participate in illegal activities in the workplace
- Filing a worker's compensation claim following an injury in the workplace
- Reporting an employer for violating labor and employment laws
- Intervening to protect other employees whose rights have been violated
Rather than directly informing you that you've been fired, an employer might use a temporary layoff as an excuse to get rid of you for a short period before eventually firing you. In that case, the temporary layoff might be considered illegal.
Employer retaliation comes in different forms. And since many employers are becoming increasingly careful about how they treat their employees in order to avoid getting in trouble with the law, you don't expect an employer to make such costly mistakes.
More specifically, you shouldn't expect your employer to be straightforward with their actions if they intend to punish you.
Some employers might use a temporary layoff as an excuse to punish you through demotion. They do this because they know they cannot legally demote you for participating in certain protected activities in the workplace.
So instead of firing you directly, here's what they'll do:
The employer will inform you that you're being laid off temporarily. They'll come up with a face-value excuse for this decision. For instance, they could claim that the business is no longer making enough money to support your department. Since this sounds like a reasonable reason, many employees will likely fall for it.
Months later, your employer recalls you to work, but then you notice that your terms of employment have significantly changed. For example, your employer might require you to take a huge salary cut even though other employees in the department are still earning what they used to earn, or even more, before being temporarily laid off.
You'll be shocked to discover that the company isn't making losses as your employer claims. You may also be surprised to learn that the other employees in the department, who were also laid off around the same time as you, were used to hiding the fact that your employer was only targeting you.
In addition, you may also discover that other employees who worked in the same department as you were also recalled back to work weeks or months before you. And when you resumed working, your employer required you to accept a pay cut.
When the Temporary Layoff Is Based on Discrimination
It is illegal for employers to discriminate against their employees. Generally, labor and employment laws all over the country prohibit employers from discriminating against employees based on certain protected characteristics such as:
- Gender
- Race
- Age
- Religious beliefs
- Sexual orientation
- National origin
- Disability
But this doesn't stop some employers from using different tactics to discriminate against their employees. Since temporary layoffs are legal, some employers take advantage and violate their employee's rights.
Here's an example of such a situation:
Let's say you have a disability and your employer doesn't want to provide reasonable accommodations as required by law. In that case, they might decide to lay off members of your department, including you, temporarily. Then, months later, your employer recalls other employees from work except you.
You then realize that all employees who have been recalled to work did not have any disability. This could be a classic case of discrimination based on disability while using a temporary layoff as a face-value excuse.
When the Reason for a Temporary Layoff Violates an Employment Contract
Suppose you had an employment contract with your employer stating that your job position and salary are guaranteed for a specific period. In that case, your employer cannot lay you off, whether permanently or temporarily. This is because you had an agreement, and laying you off—permanently or temporarily—violates this agreement.
It's also important to note that you don't necessarily need a written contract with your employer to arrive at such a conclusion. For example, if your employer made such a promise to you, either verbally or implied, the agreement might still be valid.