Implied Contract exception to Employment at-will
In general, under the employment-at-will doctrine, the employment
relationship between employer and employee is terminable at the will of
either. See At-will Employment. In Mers v. Dispatch Printing Co. (1985),
19 Ohio St.3d 100, 104-105, however, the Ohio Supreme Court recognized
the existence of implied or express contractual provisions that alter
the terms of discharge.
Facts and Circumstances Implying a Contract
The Mers, Court
held the fact finder could review the history of relations between the
employer and employee and the "facts and circumstances" surrounding the
employment-at-will relationship to ascertain the explicit and implicit
terms concerning discharge in an oral employment agreement. These
"facts and circumstances" include "the character of the employment,
custom, the course of dealing between the parties, company policy, or
any other fact which may illuminate the question * * *." Id. at 104.
In Wright v. Honda of Am. Mfg., 73 Ohio St. 3d 571, 576-577 (Ohio 1995) the Court identified other "facts and circumstances" that the trial court should consider. They included:
- information contained in employee handbooks,
representations made by supervisory personnel that employees have been
promised job security in exchange for good performance, and
- written assurances reflecting company policy.
the employee submitted an array of evidence to raise a factual issue
that an implied employment agreement existed in which the employee
could not be terminated unless she failed to perform her job
adequately. That evidence included:
- Beginning at orientation, Honda stressed to its employees the importance of attendance and performing quality work.
- The expectation of continued employment based upon these principles was further reinforced by language contained in Honda's Associate Handbook, including the handbook provision that "the job security of each of you depends on you doing your very best on your job with the spirit of cooperation." Although employee handbooks are not in and of themselves a contract of employment, they are nevertheless evidence of the employment contract. Kelly v. Georgia-Pacific Corp. (1989), 46 Ohio St.3d 134, 139, 545 N.E.2d 1244, 1249.
reports and promotion letters also stressed appellant's "continued
growth" with the company and future opportunity "to help [Honda]
achieve the goal of becoming the best place to work in the motor
- Wright's supervisor commented in a progress report that appellant was destined "to go as far as she wants to if she has the ability to maintain her good work ethic and determination."
- Management also believed that this was Honda policy. The manager who terminated Wright testified by deposition that if an employee performs his or her job in an acceptable manner and does not violate any practices of the company, the employee can expect to have continued employment with Honda.
- Honda's course of dealing
with appellant regarding her alleged violation of its anti-nepotism
policy reinforced appellant's belief that she could expect job
security. According to appellant, when she was interviewed, she was
neither asked about direct relatives nor told that Honda has an
anti-nepotism policy. Once she became aware of such a policy, she was
told by two individuals in management that she had no reason to be
concerned and that there were other employees who retained their
positions under similar circumstances. Based upon these assurances and
upon her reliance on the Associate Handbook, which called for the
transfer, not termination of, direct relatives, appellant felt secure
and continued to work diligently for Honda.
On these facts, the Wright Court was persuaded that the employee has presented sufficient evidence to create a fact question as to whether Honda, through its policies, past practices, and representations altered the at-will nature of the employment agreement by creating an expectation of continued employment. Wright v. Honda of Am. Mfg., 73 Ohio St. 3d 571, 576-577 (Ohio 1995).
At-Will Disclaimer Negates an Implied Contract
In Wing v. Anchor Media, Ltd., the
employee asserted that his employment was not terminable at will, but
rather was a contract of employment terminable for cause only based
upon the terms of the employee handbook.
The handbook and a "confirmation of employment" in Wing, however, included the following disclaimer:
. . . understand and agree that my employment is terminable at will, so
that both the Company and I remain free to choose to end our work
relationship at any time[,] subject to any contractual agreement the
Company and I have entered into. I further understand and agree that
nothing in this Policy Booklet in any way, creates an express or
implied contract of employment between the Company and me."
The Wing court
held that this disclaimer "bars the finding of a contract of employment
other than an at will relationship" and announced the rule that,
"[a]bsent fraud in the inducement, a disclaimer in an employee handbook
stating that employment is at will precludes an employment contract
other than at will based upon the terms of the employee handbook.
Wing v. Anchor Media, Ltd., 59 Ohio St. 3d 108, 110 (Ohio 1991) (citing Tohline v. Central Trust Co. (1988), 48 Ohio App. 3d 280, 549 N.E. 2d 1223).
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