Important Cases

Employment Contract Law

Watson, et. al. v. Blankinship, et. al. (1994)
28 Fed.R.Serv.3d 996; 20 F.3d 383; 128 Lab.Cas. P 57

"… We hold today that where there is proof of a promise sufficient to support an implied contract, the consideration sufficient to support the implied contract will be implied as a matter of law by the court whether the promise was part of the original employment agreement or was made later in modifying the employment relationship."

"The court continued that in order to create an implied employment contract, the promise must "be sufficiently explicit to give rise to reasonable expectations of termination for good cause only." Id. at 783. Moreover, courts may consider "the totality of the parties’ relationship, circumstances, and objectives in determining whether the presumption of at-will employment has been rebutted." Id. The court concluded that in the past it had "upheld findings of an implied employment contract provision … where the facts showed that the employer either has made a direct or indirect reference that termination would be only for just cause or has established procedures for termination…." Id. at 779. However, the court has "upheld findings that there was no implied contract in cases where the alleged promise by the employer was not sufficiently explicit."

REID, et. al. v. SEARS, ROEBUCK AND COMPANY
United States Court of Appeals, Sixth Circuit
790 F.2d 453

"Employers are most assuredly free to enter into employment contracts terminable at will without assigning cause. We hold only that an employer’s express agreement to terminate only for cause, or statements of company policy and procedure to that effect, can give rise to rights enforceable in contract."

"Absent a contractual provision for job security, either the employer or the employee may ordinarily terminate an employment contract at any time for any, or no, reason."