Written by attorney Randy T. Enochs

I was Terminated, the Handbook had a Progressive Discipline Policy that Was Not Followed. What Can I

I was recently reviewing a case out of Minnesota involving this situation (Stagg v. Vintage Place Inc. A09-949 (Minn. Ct. App. 2010)), and was somewhat shocked to learn that in Minnesota, courts have decided that when an employee handbook includes specific disciplinary steps to be taken prior to termination (e.g., a progressive disciplinary policy), an employee's "at-will" status is modified and some job security is presumed. This is great for employees in Minnesota because a lot of employers, especially bigger companies, at least in Wisconsin, have such progressive disciplinary policies and they are often center stage in unemployment compensation hearings./>/>Well, what does Wisconsin say about this topic? In Young v. Nakoma Golf Club, 418 F. Supp. 2d 1052 (D. Wis. 2006), a case not exactly on point but with discussion on the topic, the court stated:/> Therefore, the only question is whether defendant Nakoma was bound to use the progressive disciplinary policy in its employee handbook. Plaintiff cites no authority to support its argument that the rules in the employee handbook constituted terms of a contractual relationship between plaintiff and defendant Nakoma. Defendants cite Mursch v. Van Dorn Co., 851 F.2d 990, 994 (7th Cir. 1988), a diversity action in which the court of appeals, applying Wisconsin law, stated that an employee handbook does not convert an at-will employment relationship into a contractual relationship governed by the handbook's terms unless the handbook "contains express provisions from which the trier of fact may reasonably infer that the parties intended to bind each other in a different relationship."/>/>Despite its age, Mursch continues to be an accurate statement of Wisconsin law. Wisconsin adheres to the at-will employment doctrine, under which an employer may terminate an employee at any time with or without good cause. Wolf v. F & M Banks, 193 Wis. 2d 439, 449, 534 N.W.2d 877, 881 (Ct. App. 1995). In Ferraro v. Koelsch, 124 Wis. 2d 154, 368 N.W.2d 666 (1985), the Wisconsin Supreme Court held that an employee handbook may change an at-will employment relationship into one that is governed by the terms set out in the handbook. The court found that the Hyatt Corporation's employee handbook was "an express contract replete with stated consideration -the promise of employment on stated terms and conditions by Hyatt and the promise by Ferraro to continue employment under those conditions." Id. at 164, 368 N.W.2d at 671-72. Hyatt agreed that it would discharge non-probationary employees only for just cause; in return, Ferraro agreed to accept Hyatt's policies and rules as a condition of his continued employment and to give two weeks' notice before leaving employment./>/>In cases decided after Ferraro and Mursch, Wisconsin courts have held that a personnel manual will convert an at-will employment relationship into a contractual one only if it "contains express provisions from which it reasonably could be inferred that the parties intended to bind each other to a different relationship [from one that is at-will]." Olson v. 3M Co., 188 Wis. 2d 25, 54, 523 N.W.2d 578 (Ct. App. 1994) (citing Bantz v. Montgomery Estates, Inc., 163 Wis. 2d 973, 979, 473 N.W.2d 506, 508 (Ct. App. 1991)); see also Helland v. Froedtert Memorial Lutheran Hosp., 229 Wis. 2d 751, 756, 601 N.W.2d 318 (1999)(employee handbook did not create contract of employment; employer reserved right to take any disciplinary action against employees it deemed appropriate regardless of procedures in handbook and to modify handbook unilaterally and provided explicitly in handbook that it did not create any contractual rights). Thus, Wisconsin holds that at-will employment, despite the presence of progressive discipline, is still the presumption and rule UNLESS the handbook contains "express provisions from which it reasonably could be inferred that the parties intended to bind each other to a different relationship [from one that is at-will]." Usually, that is not the case./>/>I find this to be a pretty unfair concept though I can understand the policy behind Wisconsin's stance on the at-will doctrine. Employees are heavily governed and bound by handbooks and they are conveniently used to terminate employment with the vaguest of language sometimes. It seems to be a one-way street because employers don't necessarily have to follow it at the risk employees do. Perhaps continuing to put up this argument and fight may convince Wisconsin courts to re-consider because all of the cases cited above have been distinguished or criticized at some point.

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