Employee Handbooks: Legal Protections or Smoking Guns?
Employee handbooks can be useful tools for employers to communicate expectations the company has for its employees, but if the company is not careful, the handbook may be used against them and interfere with the ability of management to do its job.
As an employment at-will state, Alabama employers generally have the right to terminate an employee at any time for any reason, or without giving a reason. There are, of course, important exceptions to this rule, such as termination in violation of state or federal anti-discrimination laws, or in retaliation for filing a workers’ compensation claim or otherwise exercising protected rights. But as long as it is not illegal, an employer may fire an employee for a good reason, a bad reason, or no reason at all.
At-will employment can be limited by contract, however, and this is where employee handbooks may come in. It’s obvious that a written employment agreement could limit employment at will by stating a definite duration of the employment relationship, or by listing the reasons for termination. A termination in violation of the terms of the contract could be the basis for a breach of contract lawsuit by the employee, with the employer exposed to money damages.
But contracts can be formed in many ways. Even an oral promise can form the basis of a valid, enforceable contract. It should come as no surprise, then, that statements in an employee handbook may be held to bind the employer as well. The handbook may state expectations the employer has of the employee, such as coming to work on time, being neat in appearance, obeying workplace safety rules and following orders. But an employer should be careful about making any statements that limit its ability to fire without cause, in particular statements that termination will only be “for cause” or “for just cause.” There may be reasons an employer will want to give up the at-will status of its employees, such as for increased job security in a competitive labor market. But this should only be done thoughtfully and deliberately. An unintentional slip in an employee handbook will not further the employer’s needs.
The attorneys at The Hawkins Law Firm are well-versed in state and federal employment law. We can help employers draft or review their handbooks to make sure their rights are protected and accurately and adequately reflected in handbooks, job descriptions, and other company documents. We also draft and review employment contracts and related agreements, including covenants not to compete, confidentiality agreements, equity compensation packages for executives, and separation and severance agreements. For advice and assistance with employment law matter in Alabama, contact The Hawkins Law Firm.