Do executive director performance evaluations negate “at will” policies?

I learned recently that two nonprofit boards I have experience with each decided to terminate their executive directors. One decision was the result of a long cycle of feedback, evaluation, and more feedback. This I understood. Sad for the executive director but, for a variety of reasons, almost inevitable.

The second termination was a total surprise—even a shock. Yes, there were tensions (relationships are rarely perfect) but over the past several months the board had done quarterly performance reviews with the executive director and, not only did they not identify significant issues, they concluded he met all his key objectives. This raised a human resources question for me that I realize is very important for nonprofit boards to understand: what is the relationship between an organization’s executive director performance evaluation process (and related policies) and at-will employment? (Disclaimer: I am not an attorney and this is not legal advice.)  After some research, I continue to understand these situations as anything but clear-cut. However, there are some principles that might help to guide nonprofit boards’ actions:

1.  Have a clear and unequivocal statement in the organization’s personnel policies re: the organization’s position on at-will employment as it relates to progressive discipline.

2.  Follow your adopted policies and procedures.

3.  Be aware that there may be other laws that make evoking at-will terminations without cause murky territory and riskier:  anti-discrimination, public policy, and whistle-blower protections, for example. Boards should understand what these laws are.

Do you have experience with this that you can share? Any words of wisdom out there? I would love to hear from you so please comment or ask your questions here!