Labor: Courts continue to find that employment manuals create contract rights

Several state supreme courts agree on the issue

Recent case law suggests once again that employers should not, and cannot, afford to take employment manuals or handbooks for granted. State after state has recognized that employers' policies may bind them in unexpected ways. In just the past 18 months, the high courts of Nevada, Utah, Mississippi, Minnesota, Alaska and Idaho have confirmed that employment manuals may be contractual.

Cabaness v. Thomas is illustrative of this continuing pitfall. In that case, a line foreman sued his supervisor and employer on an implied contract theory based upon his municipal employer power company's employee manual. In particular, the manual prohibited verbal or physical conduct that "harasses, disrupts, or interferes with another's work performance or creates an intimidating, offensive, or hostile work environment." It also declared that "behavior or conduct of a harassing or discriminating nature …which is pervasive, unwelcome, demeaning, ridiculing, derisive, coercive, or results in a hostile, abusive, or intimidating work environment constitutes harassment and shall not be tolerated."

Contributing Author

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Richard Glovsky

Richard D. Glovsky is a partner and nationally recognized trial lawyer and employment law attorney with Edwards Wildman Palmer LLP. He can be reached at...

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