New Mexico is an "at will" employment state, which means that generally, an employer can fire an employee for any reason or no reason at all. But there are exceptions to the general rule that make the situation fairly complicated:
1) Employment contracts. If the employer and employee have executed a contract that governs when or how an employee can be terminated, then a termination that violates the contract could be a breach of contract, and give grounds for a lawsuit.
2) Discrimination. Even if there is no employment contract, a firing may still be illegal if it is because an employee is of a particular class (race, sex, pregnancy and new mother status, sexual orientation, age, disability, or other prohibited bases for a firing).
3) Retaliation. Even if there is no employment contract and no discrimination, a firing may still be illegal if it is in retaliation for some action on the part of an employee that the courts view as deserving protection -- actions known as "protected activity." For example, a person who is fired for opposing illegal discrimination in the workplace, or for reporting workplace safety violations.
Proving motive. In the case of discrimination and retaliation, the tricky part is proving why an employer fired an employee, because it's very difficult to prove a person's motives. Here are some of the ways an employee can prove that an employer fired an employee illegally:
a) An employer's statement. If an employer outright says he is acting for a particular reason, that can prove the illegal purpose. For instance, if an employer says "You'll never make it in this company because you reported that discrimination."
b) Close in time. If an employee opposes discrimination in the workplace and is fired within a short time after, courts may infer that the firing was caused by the opposition to the discrimination.
Other reasons for the action. Even if an employer fires an employee within a short time after the employee engages in protected activity, the firing will not be illegal if the employer had some legitimate reason to fire the person. For instance if I report discrimination one day and then steal from the cash register the next day, my employer can still fire me for stealing from the cash register.
Pretext. Even if an employer has other reasons to justify firing the employee, it may still be illegal if the employee can show the reason was pretextual, or fake. An employee can prove pretext by showing:
a) A delay between the action used to justify termination and the termination;
b) The employer's reasons changed over time;
c) That he was terminated for doing things other people were not terminated for;
d) That the company fired him without using any objective standards to make the decision;
e) That the employer set the employee up for failure;
f) That the employer does not appear to be honest;
g) That the punishment was overly severe;
h) That the employer did a shoddy investigation;
As you can see, there is no easy answer to the question "when is it illegal to fire an employee?" It's a complicated area of the law. If you'd like to get more advice -- either as an employer trying to avoid being sued for firing someone illegally, or as an employee trying to determine if you have been fired illegally -- give Altura a call. We'd love to sit down with you and help however we can.