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Wrongful Termination in Employment Cases

Wrongful discharge cases, may be predicated upon a variety of legal theories and have become increasingly prevalent in modern society.

  • Breach of Contract – A plaintiff’s wrongful discharge case may be based on the claim that the defendant employer violated the terms of an express written contract, particularly when the contract prohibits employment termination except for “just cause.” These cases often involve litigation of standard contract issues, including contract formation, performance, breach, and damages.

The vast majority of employment relationships involve no written contract or specified term of employment and thus implicate the nearly universal rule that such employment is terminable at will, with or without cause. These cases involve limitations upon the employer’s right to discharge which are derived from developing case law.

One such limitation exists when the plaintiff is able to prove an implied-in-fact contract to refrain from discharge absent just cause. Such agreement is predicated on the facts and circumstances of each case, and thus litigation often involves hotly contested issues regarding the legitimate expectations of the claimant. When the plaintiff carries his or her burden of proof, the recovery that follows is for breach of the implied contract.

  • Breach of Covenant of Good Faith and Fair Dealing – A second limitation upon the right to discharge an “at will” employee is grounded in the covenant of good faith and fair dealing implied in every contract. This implied covenant, which postulates that neither party will do anything to deprive the other of the benefits of the bargain, is often implicated when the employer acts in bad faith following conduct which gives rise to the legitimate expectation of continued employment. Courts often note that breach of the implied covenant sounds in both contract and tort, but the current trend appears to restrict plaintiff to contractual remedies.
  • Violation of Public Policy – The final “common law” limitation upon the right to terminate at-will employment without cause is characterized as “discharge in violation of public policy.” The seminal cases involve discharge in retaliation for the exercise of constitutional or statutory rights, such as firing following union activities, the exercise of voting rights, or refusal to commit perjury. These cases frequently focus on the identification of the public policy allegedly violated, with jurisdictions splitting on the issue of whether the public policy must be grounded on constitutional or statutory provisions as opposed to more broadly based conceptions of “public policy.” Similarly, jurisdictions differ over the question of whether discharge in violation of public policy constitutes breach of contract as opposed to tortious conduct.
  • Additional Causes of Action – In addition to the above-enumerated bases of liability, wrongful discharge claims are frequently predicated upon numerous statutes affecting particular types of employment. These include state civil rights laws and the Federal Civil Rights Act, anti-discrimination laws, whistle-blower protection acts, statutes conferring protection upon the industrially injured and a host of other enactments. Since the remedial schemes embodied in these enactments are frequently held to preempt “common law” wrongful discharge theories, counsel must pay careful attention to the statutory and case law existing in each jurisdiction.
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