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Can I fire an employee for any reason?
Do I have to give a fired employee a severance package?
What do I tell prospective employers who call me for a reference for an employee whom I fired?
Can my company be sued for hiring -- or keeping on -- a dangerous employee?
Can I fire an employee for making a false complaint about our company's billing practices to a government agency?
Can I fire an employee for any reason?
No. Although the law gives employers a great deal of leeway in deciding whether to fire an employee, there are limits. State and federal laws prohibit employers from firing workers for certain reasons -- for example, because of the worker's race or religion, because the worker took family leave, or because the worker complained of illegal company activity. For a list of reasons for which you can never fire an employee, see Illegal Reasons for Firing Employees.
If the employee has an employment contract or you have made promises to the employee, then you must honor your commitment.
For more information:
http://www.nolo.com/article.cfm/ObjectID/56AD023D-362A-4053-91E8F1ACD35A0963/catID/5DF453C7-2180-4035-AD75304A83BC6543/111/259/183/FAQ/