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Article Title: Inadvertently Defeating At-Will Employment
Author: Dale Blea
Category: Employee Relations, National, State, Local
Word Count: 768
Keywords: employee handbooks, at-will employment, human resources
Author's Email Address: [email protected]
Article Source: http://www.articlemarketer.com
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California Labor Code section 2922 provides: "An employment, having no 
specified term, may be terminated at the will of either party on notice to the 
other."[1] Simple enough, right? Unless an there is an agreement that an 
employment relationship is going to exist for a specific period of time, the 
relationship is considered "at-will" and may be terminated by either the 
employee or employer, with or without cause, for any reason or no reason at 
all. Not so fast. What constitutes an agreement between an employer and 
employee? The answer is, many events may convert "at-will" employment 
relationships into "employment for a specified term" within the meaning of 
Section 2922.

Many employers incorrectly assume that their employment relationships are 
protected by provisions in employee handbooks. Unfortunately, even clearly 
worded disclaimers, specifically stating that all employment relationships 
within their company are "at-will" are often insufficient to avioid a finding 
that an employment contract exists.  In fact, California courts have held that, 
notwithstanding such disclaimers, an employer's past practices, policies, 
actions and communications may result in an assurance of continued employment 
that defeats the presumption of "at-will" employment.

Employers regularly rely on generic employee handbooks purchased from Internet 
sources or office supply stores. Still others believe their business is 
adequately protected by a handbook the employer prepared based on his or her 
experience over the years. A poorly drafted employee handbook may itself defeat 
the presumption and create an employment relationship that may be terminated 
only for cause.

Probationary or Introductory Period

Many employee handbooks describe a probationary or introductory period at the 
beginning of the employment relationship. This provision usually exists to, 
among other things, define when the employee is entitled to receive company 
sponsored benefits. Care must be taken to insure that the introductory period 
provision does not imply that the "at-will" relationship exists only during 
that period.

Disciplinary Procedures

Employee handbooks typically include descriptions of conduct and behavior that 
may subject an employee to discipline. These provisions often include 
disciplinary procedures that result in sanctions of increased severity upon 
repeated violations. If not well thought out and carefully prepared, an 
enumeration of offenses for which an employee may be disciplined, and 
disciplinary procedures, may well be read to imply that "at-will" employment 
does not exist.  A poorly drafted description of disciplinary procedures can be 
intrepted as establishing conditions that must occur before employment may be 
terminated.  Further, such provisions may be read as a promise that the 
employee relationship will not be terminated even upon an employee's subsequent 
breaches of the minimum conduct standards set forth in the handbook.

The obvious question is, given the potential pitfalls, why do I need an 
employee handbook to begin with? There are many advantages to a well crafted 
employee handbook, drafted after careful consideration of your specific 
business and its unique needs and circumstances.

Standardize Application of Policy

The actions and communications of managers to employees have been found by 
courts to have created implied employment agreements. Employee handbooks 
provide employers the opportunity to establish policies relating to the actions 
and communications of their managers and supervisors and standardize the 
application of these policies to their employees.

Evaluation of Current Practices and Procedures

As noted above, an employer's past practices and policies may create an implied 
promise of future employment. An employee handbook requires an employer to 
examine the existing practices of his or her company and modify them if 
necessary to comply with applicable state and federal laws.

Limit Litigation Exposure

Employee handbooks can not only protect the "at-will" nature of employment 
relationships, they can also limit an employer's exposure in the event of 
litigation. Establishing a procedure for employees to follow in the event of 
workplace harassment, such as reporting and investigation procedures, can be 
beneficial in defending against employee claims of such a nature. A well 
drafted employee handbook containing procedures to for employees to follow in 
the event of workplace harassment, including a defined reporting and 
investigation procedure, make available the argument that the employer 
exercised reasonable care to prevent and correct the harassment and the 
complaining employee failed to take advantage of the preventative or corrective 
opportunities made available to him or her.

Just as industries and market conditions regularly change so does the law in 
the area of labor and employment on both the federal and state levels. 
Employers are well advised to remain current on these changes and adapt their 
operating policies and procedures to limit the exposure of their business 
investment. To this end, employee handbooks should be reviewed by legal counsel 
no less than annually.
________________________________________
[1] Section 2922 defines "employment for a specified term" as employment for a 
period greater than one month.

Dale J. Blea has been a practicing attorney in California since 1993.  Mr. 
Blea's primary areas of practice include business litigation and family law.  
He is a partner at Arnold & Blea, LLP, which may be vistied at 
http://www.arnold-blea.com.
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