Wooten, the employee in question, is a an Alaskan State Trooper employed by the Division of Public Safety. Troopers in Alaska aren't covered by a comprehensive collective bargaining agreement, but they do have a union, the PSEA, and it's clear from the PSEA's grievance update (PDF!) that PSEA represents terminated troopers in arbitration proceedings. That says to me that troopers are not at will employees, but can only be fired for cause.
This is confirmed by Title 2 of the Alaska Administrative Code, specifically by Articles 9 and 10 of Chapter 7.
Article 9 sets the rules for separation and demotion of public employees. Section 415 Dismissal says, in part, "The appointing authority may dismiss a permanent employee for just cause only." Section 400 provides that employees may be suspended with pay while alleged misconduct is investigated, and may be suspended without pay as a result of misconduct. Second, Section 420 says that an employee may be involuntarily demoted "for just cause". Article 10, specifically section 440, sets up an elaborate system of hearings to resolve disputes in cases of suspension, demotion, or dismissal.
Now, I'm no lawyer, and I don't know how this compares to other civil service legislation, but to me this reads pretty straightforwardly as a system in which the governor lacks the authority to fire ordinary state employees.
And, in fact, even insta-astronuts agree:
Monegan alleged shortly after his dismissal that it may have been partly due to his reluctance to fire an Alaska State Trooper, Mike Wooten, who had been involved in a divorce and child custody battle with Palin’s sister, Molly McCann. In 2006, before Palin was governor, Wooten was briefly suspended for ten days for threatening to kill McCann’s (and Palin’s) father, tasering his 11-year-old stepson (at the stepson’s request), and violating game laws. After a union protest, the suspension was reduced to five days. |Right Thinking|