If an employee is told that he’s doing a good job and should
be with the company for a long time to come, could that statement come back to
haunt the employer if it later terminates him? A state court of appeals recently faced this scenario.
What happened. “Chas”
worked as the Administrative Director of Radiology for a hospital association
from May until October 2006. During that short time, he received three
performance evaluations, all with ratings of “good” or “very good,” and all
concluding that he should be retained. He would say later that one of his
managers even told him that he was doing such a good job that there would be no
reason for them to get rid of his position.
Based on this feedback, Chas was surprised when the hospital
association terminated him in October 2006, explaining that he was not a good
fit. He sued the hospital association on a number of theories, including breach
of an implied contract.
What the court said. In Ohio, employment situations without a fixed duration are presumed to be
at-will, meaning that the employer can fire the employee at any time and for
any reason that is not contrary to law. One exception to this rule involves
situations in which there is an expressed or implied employment contract.
To prove the existence of such a contract, the court said,
Chas had to show that (1) the employer assured him that satisfactory work
performance was connected to job security; (2) he had a subjective belief that
he could expect continued employment; and (3) the employer shared the
expectation of continued employment.
The court pointed out that, before starting work, Chas had
signed an employment application stating that he understood that his employment
was at-will, and that the hospital’s employee handbook contained a similar
notice. Turning to Chas’s evidence, the court said that he had no evidence
showing that his supervisors ever told him that he could only be discharged for
cause, nor any other evidence that anyone promised him employment for a certain
period of time.
“The general praise he reported receiving for his job
performance does not create a genuine issue of material fact regarding the
creation of an express or implied employment contract,” the court concluded. Shetterly
v. WHR Health System, Court of Appeals of
Ohio, 9th Appellate District, Medina County, CA No. 08CA0026-M (2/17/09).
Point to remember: Job praise alone does not modify the employment-at-will relationship. And to
counteract any such assumptions among employees, an employer is wise to include
statements on its application and in its handbook stressing that employment
with the company is at-will.