Charity Can Dismiss Employee At Will

Court ruling based on terms in the charity’s employee handbook.

Church Law and Tax 1993-05-01 Recent Developments

Employment Practices

Key point: Employee handbooks can limit an employer’s legal right to dismiss “at will” an employee hired for an indefinite term. However, this is not always the case.

A Louisiana appeals court ruled that a charity could dismiss an employee at any time despite the existence of an employee handbook. A charity hired a female employee and provided her with a copy of the employee handbook. On a couple of occasions, the employee’s husband engaged in violent and threatening behavior at the workplace. The employee was warned that further outbursts by her husband (who was not an employee) could not be tolerated and could result in dismissal. Several months later, the husband called the charity and threatened to “blow everyone away” and destroy everything connected with his wife. The employee was dismissed as a result of this incident (although the charity agreed to let her resign instead of being dismissed). The dismissed employee later sued the charity, alleging that she had been wrongfully terminated. The charity asked the court to dismiss the case, and the court agreed. This decision was upheld on appeal by a state appeals court. The court began its opinion by emphasizing that under Louisiana law, “where the term of employment is indefinite, the employment is terminable at the will of either the employer or the employee …. When hired, she was free to quit at any time or, as in this case was subject to termination at any time for any or no reason.” The dismissed employee acknowledged that she could be terminated at any time under the so-called “at will” employment rule, but she insisted that this rule was modified in this case by the provisions of the employee handbook provided to her by her employer. In particular, she pointed to the disciplinary policies in the handbook that outlined a system of “progressive discipline” in cases of employee misconduct. The handbook specified that an employer could respond to employee misconduct through a variety of disciplinary actions including verbal counseling, written counseling, probation, suspension, and dismissal. The dismissed employee claimed that this system of progressive discipline was a contractual commitment on the part of the employer that prevented her from being summarily dismissed. The court disagreed with the dismissed employee’s position for three reasons. First, it pointed out that the employee handbook specified that “an immediate discharge may be warranted for severe actions without prior counseling.” Second, the dismissed employee had signed a written statement following one of her husband’s earlier outbursts acknowledging that further outbursts could lead to her dismissal. Third, the court concluded that the system of progressive discipline set forth in the employee handbook did not create any contractual rights that would negate the “at will” employment rule. It observed: “The personnel manual provided general guidelines and in no way indicated mandatory levels of disciplinary action which supervisors must implement sequentially …. Our review of the personnel manual reveals no provision which is indicative of an agreement between [the employee and employer] concerning the manner in which the disciplinary process would be implemented.” Keller v. Sisters of Charity, 597 So.2d 1113 (La. App. 1992). See also Ruzicki v. Catholic Cemeteries Association, 610 A.2d 495 (Pa. Super. 1992) (an identical ruling).

See Also: Termination of Employees

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