You'd need to be vested as defined in your plan documents to keep the employer portion. This is not unusual. Typically, the longer you work for an employer, the more vested you are in the plan.

I want to find out why an employeer would keep their contributions in a 401K account for an employee that they let go.

Most companies are on a graded 5 year vesting schedule..(there are others) you are entitled to 20% of employer contributions for each year you worked there... If they let you go after two full years of service (two years that you were employed at least 1/2 the yr, and on Dec 31) you would have been 40% vested... There is nothing illegal about it.. you were not entitled to the rest.

Perhaps they'll hire you back and allow your prior service to count? Who knows, once again, read the plan documents.

There may only be limited times in the year when they can remove the funds from non-vested accounts, possibly only when the plan year changes, or there might be some limitation of like they can only get their portion back two years after you get your maximum distribution.

I can see either as being an employee protection. It would be nasty if a company could fire you, immediately remove all your "non-vested" 401(k) funds, then hire you back a month later and say "too bad."