Written by attorney Ty Hyderally

Employment Contracts- Implied in Fact

A Contract "Implied in Fact" from the Employer's Writings, Representations, Rules and Practices.

Other Written Commitments. Written policies distributed to employees that provide for termination and suggest that employment will not be terminated without cause may be found to be express contracts. Campbell v. Leaseway Customized Transp., Inc. 484 N.W. 2d 41 ( Minn. Ct. App. 1992); Thompson v. St. Regis Paper Co., 685 P. 2d 1081, 1087-88 (Wash. 1984); Bobbitt v. Orchard, Ltd. 603 So. 2d 356 (Miss. 1992).

Oral Representations of job security may provide a basis for a finding of an agreement limiting the right to terminate employment. Hamersky v. Nicholson Supply Co., 517 N.W. 2d 382 (Neb. 1994). Claims based on oral representations can also be based on the totality of the employer's conduct - writings, oral representations, company policies and procedures. The existence of a written agreement which is contradictory greatly inhibits this claim. Haggard v. Kimberly Quality Care., Inc. 39 Cal. App. 4th 508, 46 Cal Rptr. 2d 16 (1995).

Most states reject attempts to interpret expressions by the employer of "lifetime" or "permanent" employment as contractual commitments, on the rationale that they fail to state a definite term of employment. Hamersky v. Nicholson Supply Co., supra; Hunnewell v. Manufacturers Hanover Trust Co., 628 F. Supp. 759 (S.D.N.Y. 1986); McKenny v. John V. Carr & Son, Inc. 922 F. Supp. 967 (D. Vt. 1996).

But don't be so sure. There are cases in which written at-will provisions in handbooks and elsewhere are deemed modified or eliminated by subsequent representations, assurances, etc. to the employee that she will be terminated only for cause. Thomka v. Financial Corp. 15 Cal. App 411 877, 19 Cal Rptr. 2d 382 (1993); Wilson v. General Motors Corp., 454 N.W. 2d 405 (Mich Ct. App. 1990). Many courts may require that such assurances be in exchange for additional consideration by the employee, such as a decision to turn down a competing offer of employment, geographic relocation, etc.

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