Tuesday, March 27, 2012
Implied or Explicit Contracts Limiting An Employer's Right of Discharge
From Attorney Jonathan Cooper:
With the proliferation of employee handbooks and manuals at corporations, a natural question arises:
To what extent are the protections that are afforded to employees under these manuals actually enforceable?
From the employee's perspective, the answer is not terribly much - at least not under New York law.
Here's why: the majority of these employee manuals also have language explicitly providing that nothing contained therein should be construed as creating anything other than an at-will employment.
Consequently, even the "Whistleblower" protections provided for in these manuals will often prove to no avail - unless the employee can demonstrate that the policy pre-dated their empolyment at the company, and that they detrimentally relied on that policy in deciding to accept that position (a truly daunting burden of proof).
As an upstate appeals court recently put it:
"It is well settled that, 'absent an agreement establishing a fixed duration, an employment relationship is presumed to be a hiring at will, terminable at any time by either party' (Sabetay v Sterling Drug, 69 NY2d 329, 333 ; see Lobosco v New York Tel. Co./NYNEX, 96 NY2d 312, 316 ; Matter of De Petris v Union Settlement Assn., 86 NY2d 406, 410 ; Murphy v American Home Prods. Corp., 58 NY2d 293, 300-301 ). This presumption may be rebutted by proof establishing that "the employer made the employee aware of its express written policy limiting its right of discharge and that the employee detrimentally relied on that policy in accepting the employment" (Matter of De Petris v Union Settlement Assn., 86 NY2d at 410; see Weiner v McGraw-Hill, Inc., 57 NY2d 458, 465-466 ;Fitzgerald v Martin-Marietta, 256 AD2d 959, 960 ; Novinger v Eden Park Health Servs., 167 AD2d 590, 591 , lv denied 77 NY2d 810 ). Notably, "[t]he requirements for such an implied contract of employment have been strictly construed, and the successful plaintiff must sustain an 'explicit and difficult pleading burden'" (Preston v Champion Home Bldrs., 187 AD2d 795, 796-797 , quoting Sabetay v Sterling Drug, 69 NY2d at 334-335; see Matter of LaDuke v Hepburn Med. Ctr., 239 AD2d 750, 753 , lv denied 91 NY2d 802 )."