A.R.S. § 23-1501 Addresses The Severability Of The Employment Relationship And Retaliatory Discharge
Although Arizona is an employment at will State, meaning that the employment relationship may generally be terminated by either the employer or employee for any reason or no reason, there are exceptions to this rule. These exceptions are codified in State or federal law. The Arizona legislature enacted the Arizona Employment Protection Act in 1996, which establishes guidelines to clarify what constitutes, or does not constitute, wrongful termination under Arizona law. These standards are set forth in A.R.S. § 23-1501, which states:
A. The public policy of this state is that:
1. The employment relationship is contractual in nature.
2. The employment relationship is severable at the pleasure of either the employee or the employer unless both the employee and the employer have signed a written contract to the contrary setting forth that the employment relationship shall remain in effect for a specified duration of time or otherwise expressly restricting the right of either party to terminate the employment relationship. Both the employee and the employer must sign this written contract, or this written contract must be set forth in the employment handbook or manual or any similar document distributed to the employee, if that document expresses the intent that it is a contract of employment, or this written contract must be set forth in a writing signed by the party to be charged. Partial performance of employment shall not be deemed sufficient to eliminate the requirements set forth in this paragraph. Nothing in this paragraph shall be construed to affect the rights of public employees under the Constitution of Arizona and state and local laws of this state or the rights of employees and employers as defined by a collective bargaining agreement.
3. An employee has a claim against an employer for termination of employment only if one or more of the following circumstances have occurred:
(a) The employer has terminated the employment relationship of an employee in breach of an employment contract, as set forth in paragraph 2 of this subsection, in which case the remedies for the breach are limited to the remedies for a breach of contract.
(b) The employer has terminated the employment relationship of an employee in violation of a statute of this state. If the statute provides a remedy to an employee for a violation of the statute, the remedies provided to an employee for a violation of the statute are the exclusive remedies for the violation of the statute or the public policy set forth in or arising out of the statute, including the following:
(i) The civil rights act prescribed in title 41, chapter 9.
(ii) The occupational safety and health act prescribed in chapter 2, article 10 of this title.
(iii) The statutes governing the hours of employment prescribed in chapter 2 of this title.
(iv) The agricultural employment relations act prescribed in chapter 8, article 5 of this title.
(v) The statutes governing disclosure of information by public employees prescribed in title 38, chapter 3, article 9.
All definitions and restrictions contained in the statute also apply to any civil action based on a violation of the public policy arising out of the statute. If the statute does not provide a remedy to an employee for the violation of the statute, the employee shall have the right to bring a tort claim for wrongful termination in violation of the public policy set forth in the statute.
(c) The employer has terminated the employment relationship of an employee in retaliation for any of the following:
(i) The refusal by the employee to commit an act or omission that would violate the Constitution of Arizona or the statutes of this state.
(ii) The disclosure by the employee in a reasonable manner that the employee has information or a reasonable belief that the employer, or an employee of the employer, has violated, is violating or will violate the Constitution of Arizona or the statutes of this state to either the employer or a representative of the employer who the employee reasonably believes is in a managerial or supervisory position and has the authority to investigate the information provided by the employee and to take action to prevent further violations of the Constitution of Arizona or statutes of this state or an employee of a public body or political subdivision of this state or any agency of a public body or political subdivision.
(iii) The exercise of rights under the workers' compensation statutes prescribed in chapter 6 of this title.
(iv) Service on a jury as protected by section 21-236.
(v) The exercise of voting rights as protected by section 16-1012.
(vi) The exercise of free choice with respect to nonmembership in a labor organization as protected by section 23-1302.
(vii) Service in the national guard or armed forces as protected by sections 26-167 and 26-168.
(viii) The exercise of the right to be free from the extortion of fees or gratuities as a condition of employment as protected by section 23-202.
(ix) The exercise of the right to be free from coercion to purchase goods or supplies from any particular person as a condition of employment as protected by section 23-203.
(x) The exercise of a victim's right to leave work as provided in sections 8-420 and 13-4439.
B. If the statute provides a remedy to an employee for a violation of the statute, the remedies provided to an employee for a violation of the statute are the exclusive remedies for the violation of the statute or the public policy prescribed in or arising out of the statute.
Employment Contracts Must Be Written To Be Enforceable
One of the major effects of A.R.S. § 23-1501, is the clarification that employment contracts must be written to be enforceable. Prior to the enactment of this statute a number of court decisions had extended contract-based protections to employees who had been terminated from their employment, a result the legislature wanted to prevent in the future. The legal effect of this statute is that, contrary to the understanding of many Arizona employees, they may be fired at any time absent some written agreement to the contrary.
Wrongful Termination Claims Still Exist As Provided By A.R.S. § 23-1501
A.R.S. § 23-1501 does, however, still provide for the possibily of a viable wrongful termination claim in a number of circumstances. These include the breach of a written contract, violation of a specific statute, or retaliation for the employee's report of certain legal violations or exercise of certain legal rights.
If you have had your employment terminated involuntarily you should speak with an Arizona employment lawyer as soon as possible to determine whether your legal rights and obligations.