Reading At-Will: Employee Handbook Terms

March 7th, 2017 by JBWK

Submitted by Katharine J. Westfall

Employees in the Commonwealth of Virginia are generally presumed to be employed at-will, unless it can be proven otherwise, such as by a written contract for a definite duration or evidence of some specific promise by their employer.  In short, the at-will employment doctrine provides that either the employer or employee may terminate the employment at any time, with or without providing an explanation of cause for that termination.

In employment litigation, employee handbooks and other human resources publications are frequently a focal point of the at-will versus for-cause analysis. Yet many employers and employees may not be conscious of the language set forth in those documents or the legal impact that language could have.

In Virginia, as a rule, personnel manuals and the like generally are not considered legally binding employment contracts. Where the terms contained within an employee handbook offer only an illustration of the employer’s expectations for employees’ behavior and do not limit the conditions under which an employee may face discipline or discharge, Virginia courts have held the handbook insufficient to create a contractual relationship. Moreover, even where a handbook’s terms may leave some question as to their contractual nature, courts applying Virginia law have held that an employer’s written disclaimer (within the pages of the handbook) that the handbook is not intended as a legally binding agreement takes precedence over any other language to the contrary.

Significantly, Virginia law also recognizes that employment contracts are subject to the statute of frauds, a legal doctrine that requires an agreement for services that cannot be completed within one year to be in writing and signed. Contracts that are subject to the statute of frauds but fail to comply with it cannot form the legal basis of a viable contract claim. With limited exceptions, the Virginia Supreme Court has held that personnel manuals and other employer-produced materials that do not include a signature of the employer or its authorized agent may not be sued upon as employment contracts.

For employees and employers alike, an awareness of the terms, conditions, and nature of the employment is key to understanding the parties’ respective rights when the relationship terminates.

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