Think about the following questions from the point of view of violation of public policy or breach of a covenant of good faith and fair dealing, and see what the outcome would be.
* a. An employee was suspended pending discharge for sleeping and “loafing” on the job. The employer offered to change the penalty to suspension without pay if the plaintiff would sign a “last-chance agreement” under which he waived and released “any claims, suits, or causes of action” against the defendant. The employee refused to sign because he was unwilling to waive his rights to state unemployment benefits or workers' compensation. Under state statute, agreements to waive such rights are invalid. The ...view middle of the document...
Violation of Public Policy
One of the most visible exceptions that states are fairly consistent in recognizing, either through legislation or court cases, has been based on a violation of public policy. For a terminated employee to sustain a cause of action against her or his employer on this basis, the ex-employee must show that the employer's actions were motivated by bad faith, malice, or retaliation. At least 44 states allow this exception. Violations of public policy usually arise when the employee is terminated for acts such as refusing to violate a criminal statute on behalf of the employer or at the employer's request, exercising a statutory right, fulfilling a statutory duty, or disclosing violations of statutes by an employer. Many states prohibit employers from terminating a worker in retaliation for engaging in these protected activities.
A legal concept intended to ensure that no individual lawfully does that which has a tendency to be injurious to the public or against the public good. Public policy is undermined by anything that harms a sense of individual rights.
Another exception to the at-will employment presumption is the implied duty of good faith and fair dealing in the performance and enforcement of every contract. This requirement should not be confused with a contractual requirement of “good cause” prior to termination; an employer can terminate a worker for good cause under a contract. A New York court defined the duty as follows:
* In every contract there is an implied covenant that neither party shall do anything which will have the effect of destroying or injuring the right of the other party to receive the fruits of the contract, which means that in every contract there exists an implied covenant of good faith and fair dealing. While the public policy exception to the at-will doctrine looks to the law to judge the employer's actions and deems them violations of public policy or not, the breach of implied covenant of good faith looks instead to the actions between the parties to do so.
Where the implied covenant of good faith and fair dealing is recognized as an exception to the at-will doctrine, courts have implied that any agreement between the employer and the employee has inherent in it, unless specifically excluded, a promise that the parties will deal with each other fairly and in good faith. Consider the situation where the employer and employee may have entered into a contract of employment, but the particulars of why and when an employee could be terminated were not specifically addressed in the parties' contractual agreements. Assume the employee is then terminated for what the employee believes is an unwarranted reason, but the court looks to the contract and finds that the matter is not covered by the contract. The court will then look to the facts to see whether the termination is valid under the contract or in breach of the implied covenant of good faith and fair dealing.