- Linda Dillon complains that he employment in Champion Jogbra ended with wrongful termination and that the court previously judging her case erroneously granted summary judgment to defendant Champion Jogbra Inc. The legal issues that the plaintiff invoked in the case were the promissory estoppel, and the modification of the at – will employment status in Jogbra’s employment manual and employment practices, considered implied contract. Dillon sustained the promissory estoppel to support her case, based on her experience with the Vice President of the Sales Department, her direct coordinator in the new position she was encouraged to apply for (the sales administration position). After taking the interview for the sales administration position, Dillon’s coordinator assured her that she will receive proper training from her predecessor and informed her that it will take her around 4 to 6 months to get accustomed with the job, determining the plaintiff to consider that the management’s decision to remove her from the sales administrator position in 10 days since she occupied that role was an improper treatment, disregarding the “Corrective Action Procedure” that referred to employing a progressive discipline system for employees. The plaintiff also claims that she did not benefit of the implied contract procedures for terminating an employee (as they were specified in the employee manual).
- Dillon was hired in Champion Jogbra in 1997, based on an “at-will contract”, which in legal terms, allows the employer to terminate any employees’ contract whenever he desires to do so, based on a cause or on no cause, even on a wrong cause (Walsh, 2012). In the period from 1996 to 1997 the company developed the “Corrective Action Procedure”, to indicate that the employees will benefit of termination procedures based on a progressive discipline system, which, as the plaintiff claims, she did not benefit of. The implied contract in Dillon v. Champion Jogbra’s case is based on the employees’ manual that included a procedure for termination, which implied a reason, a cause for termination. The implied contract was created on the basis of the internal organizational handbook. The law considers the personnel manual as constituting “both expressively and impliedly employee contracts or to become part of employee contracts when they are given to employees at the outset” (Jennings, 2006). As Jennings (2006) continues, for employees to consider the personnel manual as constituting a contract, it must determine reliance of an employee on the procedures mentioned in the personnel manual. Applied to Dillon’s case, the former Champion Jogbra’s employee considered the “Corrective Action Policy” that stated that the termination of the contracts with the employees will be based on a progressive disciplinary system and that all employees will be treated in “a fair and consistent manner” (Dillon v. Champion Jogbra, in Walsh, 2012, p. 632), the plaintiff claims that she was wrongfully treated by the employer, who did not follow the procedures included in the “Corrective Action Policy”. This is because after she was announced that she has to leave the sales administrator position (in September) she was offered a temporary job, until the end of December, following that her contract with Champion Jogbra would be terminated, unless she could apply for the available positions within the company and occupy any of that positions. But as she did not land any other job within the company and because she was not benefiting of the progressive discipline system, meaning that she would be penalized for her errors progressively until she would have to leave the company, Dillon invoked the implied contract to sustain the wrongful termination of her contract.
- The employer breached the implied contract by using the disclaimer to point out that “the policies and procedures contained in [the] manual constitute guidelines only. They do not constitute part of an employment contract, nor are they intended to make any commitment to any employee concerning how individual employment action can, should, or will be handled” (Dillon v. Champion Jogbra in Walsh, 2012, p. 632). With this statement, mentioned at the beginning of the personnel manual, the employer assured that the manual must not be interpreted as a contract (as an implied contract, in this case), but as a guideline, living like this the “Corrective Action Policy” and the statement that the employees’ termination would be based on a progressive disciplinary system at the level of a simple internal guideline. Dillon claimed that the manual that she considered the implied contract used ambiguous language, allowing the employees to still perceive it as a contract, although it clearly stated that should not be perceived as a contract, but as a guideline. However, the court dissented that the language was ambiguous, considering it sufficient in order to clearly state the employer’s intention that the manual should not be considered a contract. Moreover, the employer linked the previous statement by another, stating that “Champion Jogbra reserves the right to terminate any employee at any time ‘at-will’, with or without cause” (Dillon v. Champion Jogbra, in Walsh, 2012, p. 632), making the plaintiff’s claim in vain, as this statement reiterates the main clause of an “at will” contract, meaning the right of the employer to terminate any employee with or without cause, whenever the employees desires. Therefore, the employer breached the implied contract by the statements included at the beginning of the manual that was considered the implied contract, which stipulated that the material was not to be used as a contract, but as a guideline and that the company reserves the right to terminate at will an employee with or without cause.
- The disclaimer included in the employee manual creates ambiguities for the employees, which is not the effect desired by the employer. With the statements settled in the beginning of the employee manual, Champion Jogbra intended to determine the employees to perceive this manual as internal guideline procedures and, as clearly stated, not as a contract. In fact, the organization developed the manual only as a guideline and it clearly states that managers can deviate from these guidelines in individual cases. However, the employees viewed it precisely as an implied contract, considering the fact that that the employees relied on the procedures and terms specified in the manual (in the examined case specifically on the Corrective Action Policy), and as Jennings (2006) observed, this is a factor that determines a personnel manual to be perceived as an implied contract. Moreover, the disclaimer was considered inconsistent and at conflict with the “at-will” policy that governed over the organization. The majority of Champion Jogbra’s personnel understood that the manual and especially the “Corrective Action Policy” was specifying the contractual procedures that had to be met before terminating an employee’s contract, and the proof of this is the fact that even the Human Resources manager considered this, as she informed Dillon that the company must follow procedures when deciding to terminate an employee, according to Dillon’s statement.
References
Jennings, M., M. (2006) Business: its legal, ethical and global environment. Mason, Thomson Learning Academic Research Center.
Walsh, D., L. (2012) Employment law for human resource practice. 4th edn. Mason, South Western Cengage Learning.
