Document Type

Article

Publication Date

5-2006

Keywords

Wrongful discharge

Disciplines

Labor and Employment Law

Abstract

We estimate the effects on employment and wages of wrongful discharge protections adopted by U.S. state courts during the last three decades. We find robust evidence that one wrongful-discharge doctrine, the implied-contract exception, reduced state employment rates by 0.8% to 1.7%. The initial impact is largest for female and less-educated workers (those who change jobs frequently), while the longer-term effect is greater for older and more-educated workers (those most likely to litigate). By contrast, we find no robust employment or wage effects of two other widely recognized wrongful-discharge laws: the public-policy and good-faith exceptions.

Publication Citation

Review of Economics & Statistics, vol. 88, no. 2 (May 2006)

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