[that_james]

For me it boils down to this:

If you ask for an employee that doesn't exist, is it a failure? Or is it just a negative, but expected response?

Perhaps that's a stupid question though.

[wizofaus]

If you write an API designed to return a single entity matching the path provided, it's absolutely an error if it doesn't exist. If your API returns the simplest possible JSON representation in a success case, what JSON should it return if it doesn't exist?