Risk

Legal Risk and Opportunity in Employment

Legal encounter1

Type of contract agreed between the company and Pat is under “Implied contract” that govern the relation between employer and employee. “Many courts have implied the existence of a contract because of the presence of promises, procedures, and policies in an employee personnel manual.”(Jennings, 2006, Ch.18), therefore there is boundaries should be respected and process need to be followed in case of termination.

In case of Pat, some legal issues and liability may be applied in case wrongful discharge. NewCorp will be legally responsible for conducting a wrongful termination of its employee under a theory of promissory estoppels. As per common law, the doctrine of promissory estoppels prevents one party from moving back a promise made to a second party if the latter reasonably has relied on that promise. Pat raises the point of receiving from his manager decision that he would be discharged because his work performance is not going as expected but never received “Notice of Unsatisfactory Performance/Corrective Action Plan” and therefore the implied contract exception, as developed in common law, has been violated by Newcorp and in case decision will be formally executed, company will be enforced to pay back Pat cost of relocation and related damages that will follow from selling and buying home, transfer of children and resignation of Pat’s wife from her work because he did all this based on a written agreement with the company. In one of the cases that support this point of view, case of Linda Dillon (Jennings, 2006, Ch.18, case 18.7) in which Linda brought suit against Jobra Company for a wrongful termination based on theory of promissory estoppels.

Company has to be careful when executing a discharge notice that will be in the favor of employee because he can still be able to set up a claim against that company, and best treatment for this legal issue would be to follow the procedure of discharge by...