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Published: 2008-03-26

Employment at Will in Pennsylvania: The Basics



I. INTRODUCTION

  1. Since 1891, Pennsylvania has subscribed to the theory of employment at will. Thus, as the court noted in Stumpp v. Stroudsburg Municipal Authority 540 Pa. 391, 396 (1995), "as a general rule, employees are at-will, absent a contract, and may be terminated at any time, for any reason or for no reason."
  2. The rationale of employment at will is the preservation of managerial prerogatives by the employer. Conversely, though, an at will employee may resign at any time (with no notice) and for any reason. Veno v. Meredith 357 Pa. Super. 85, 96 (1986).
  3. The first real assault on employment at will occurred in Geary v. United States Steel Corp. 456 Pa. 171, 184 (1974). In that case, a salesman complained about the safety of a new product. When the employee voiced concerns to his direct superiors, he was instructed to follow directions (which he agreed to do). However, the employee went over his superiors' heads and voiced his concerns to a corporate vice president. As a result, the Defendant withdrew the product from the market. Shortly thereafter, Defendant terminated Plaintiff. In Geary, our Supreme Court recognized the possibility that a public policy wrongful discharge could occur but not on the facts of the instant case. However, this case is widely credited with opening the floodgates of employment litigation.

II. EXCEPTIONS TO THE AT-WILL DOCTRINE

  1. Statutory Violations

    There are at least 30 state and federal statutes that prohibit the discharge of an employee for adhering to or falling within the dictates of the statute. These statutes include well-known statutes such as the Americans with Disabilities Act, Age Discrimination in Employment Act, Title VII of the Civil Rights Act of 1964, and the Pennsylvania Human Relations Act. It also includes the Family and Medical Leave Act, as well as more obscure statutes such as the Federal Water Pollution Control Act or the Pennsylvania Volunteer Firefighter Act.

  2. Public Policy Wrongful Discharge Claims

    In order to prove a violation of a public policy resulting from a discharge, the employee must show that there is a clear mandate of public policy expressed in the constitution, legislation, administrative regulations, or judicial decisions. However, the public policy can be found in the above areas whether it be from state law or federal law.

    In ruling on public policy wrongful discharges, the court must first decide if an important public policy is threatened. However, even if an important public policy is threatened, the employer may still discharge the employee if it had a "separate, plausible, and legitimate reason for so doing."

    In general, the federal courts have been far more likely to find a public policy violation than the Pennsylvania state courts. Cases where the court has found a public policy violation include:

    • Where the firing itself is a criminal activity under the Crimes Code, or where the employee refuses to perform an illegal act.
    • Where the employee refuses to take a polygraph.
    • Where the employee reports illegal activity of the employer because of a statutory duty to do so.
    • Where a public employer denies employment to a convicted person and the conviction bears no reasonable relationship to a legitimate public objective.
    • Where an employee misses work to report for jury duty.
    • Where an employer fired an employee in retaliation for filing an unemployment compensation claim.
    • Where an employer discharges an employee for refusing to perform animal studies which violated federal and state law.
    • Where an employer fired an employee in retaliation for filing a Worker's Compensation claim.
    • Where an employer fires an employee for threatening to report safety violations to OSHA.
    • Where a bartender is dismissed for refusing to serve a visibly intoxicated patron.
    • Where the employer dismisses the employee for refusing to consent to urinalysis testing and property searches when the actions invaded the employee's privacy.
    • Where an employee refuses to lie to federal investigators.
    • Where an employee refuses to support the company's lobbying efforts due to personal beliefs.
    • A paralegal may state a claim for refusing to bill their time as attorney's time but not for revealing same to the clients.
    • Where a paralegal testifies against her boss in a Disciplinary Board proceeding.

    Cases where the court has refused to find a public policy violation include:

    • Where an employee strikes a co-employee in self defense.
    • Where a private sector employee reports illegal conduct of the employer when not required by statute to do so.
    • Where a private sector employer refuses to hire someone who was arrested but not convicted.
    • Where an employee alleges equitable estoppel based on reliance on the employer's promises.
    • Where a private employee threatens to report illegal activities to the government or alleges discharge with a specific intent to harm.
    • Where an employee refuses to contribute money to rectify losses of the employer where the employee made a mistake.
    • Where an employee refuses to sign an agreement allowing for a bench trial rather than a jury trial should an employment dispute arise.
    • Where an employer fires an employee for failing a drug test without using a confirming test.
    • Where a whistleblower action is brought by a private employee rather than a public employee pursuant to 43 P.S. §1421.
  3. Employment Contracts
    1. Contracts for a Specific Term

      An Employee is presumptively an at-will employee unless the employee provides clear proof of a specific duration to the contract. In such a case, the employee may only be discharged before the end of the term if just cause exists. Cases where a specific term has been found:

      • A contract that contains a 90 day notice provision for termination will be a contract for at least 90 days employment after the notice period is invoked.
      • A contract that has a term of one year is enforceable especially where the notice period is only expressed in terms of renewal or non-renewal of the contract.
      • Plaintiff was fired after 1-1/2 days on the job. The Defendant had agreed that they would provide Plaintiff with a reasonable opportunity to show that he could perform the job as Plaintiff was a young man starting his career. Given the "blot" on his record from the discharge, the court approved a jury's award of six months pay. This result is out of the mainstream and may well have occurred because of Plaintiff's appeal to the court's sense of substantial justice and fair play.

      Cases where a specific term has not been found:

      • Guarantees of employment for life or permanent employment are seldom enforceable.
      • A salary expressed over a certain period of time (e.g. annually) fails to establish a contract for a specific duration.
      • An employer's oral assurance that Plaintiff would have worked for at least two years lacks sufficient definiteness to enforce.
      • A promise to employ for so long as Plaintiff performs satisfactorily fails because the promise is too ambiguous to enforce.
      • An employer's telling an employee that the hiring is for a long range project lacks sufficient specificity to enforce.
      • A handbook provision providing permanent employment after successful completion of a 90 day probation period has been held to be too vague to enforce.
    2. Contracts for Termination Only for Just Cause
      • Situations could arise where an employee contracted for just cause only dismissal as part of an inducement to accept a job. However, in reality, the only time such provisions gain enforcement occurs when a written contract specifically contains a just cause provision. Rarely, one finds such a situation except with respect to collective bargaining agreements where just cause provisions seem fairly common. Moreover, no public policy exists in favor of just cause dismissals.
      • The publishing of a handbook is not a meeting of the minds unless the parties bargained for the handbook provisions. As such, a just cause provision usually fails for lack of consideration unless the employer evinces a clear intent to bind itself to the handbook provisions.
    3. Additional Consideration
      • Additional consideration exists where an employee undergoes a substantial hardship to accept the job that is other than the services for which the employee is hired.
      • Additional consideration also exists if the employee confers a substantial benefit on the employer other than what the position would normally require.
      • If additional consideration exists, the employee may not be fired for the term of the agreement absent just cause. If the agreement states no term, the fact-finder may impose a reasonable time period where the employee may not be fired absent just cause. This period should be commensurate with the hardship incurred or benefit conferred by the employee.