Breach of Contract

Employees may have contractual rights either under an express or implied contract. An express contract exists when there is a written agreement between the employer and the employee governing the employment relationship.

However, even when there is no written agreement, an employee may have certain legal rights under an implied contract. An implied contract is a contract that arises from promises made to employees either orally or in writing such as in a Handbook or other policies or procedures.

One type of policy or procedure that can give rise to an implied contract is a progressive discipline policy which contains certain steps for imposing discipline such as an oral warning, followed by a written warning, followed by a suspension and ultimately termination as a last resort.

Where an employee has been terminated or fired without the policy having been followed, the employer may be subject to liability for breach of contract. In addition, where an employer has breached a contract, the employer may also be liable for breach of an implied covenant of good faith and fair dealing.

An employer can avoid, or seek to avoid, liability for breach of contract by including a prominent disclaimer in the Company policy or procedure that makes it clear to the employee that they are subject to termination at will and that they have no contractual right to continued employment.

To speak with an experienced New Jersey Employment Law Attorney, contact the Law Offices of Gregory S. Schaer, LLC, conveniently located in Monmouth County, New Jersey.