Can an employee manual or handbook give rise to a lawsuit by an employee?

Most businesses reach a point where they find it necessary to put their company policies and procedures in writing. While such manuals may relate strictly to business-related processes, employers also use the promulgation of an employee manual or handbook as an opportunity to set down employment-related policies such as overtime use, hours of operation etc. In so doing, many employers employ a cut and paste method of putting down a policy over an issue that is currently percolating in the workplace, such as a chronically tardy employee. In so doing, the employer runs the risk of giving rights to an employee that the employer did not foresee or intend.

In the case of Thompson v. St. Regis Paper Co., 102 Wn.2d 219, 685 P.2d 1081 (1984), the Washington State Supreme Court held that the employer's right to terminate an at will employee can be contractually modified and, thus, qualified by statements contained in employee policy manuals or handbooks issued by employers to their employees. Thus, even though, in Washington State, an employee works at will of the employee, which is to say he/she may be terminated for any lawful reason, the relationship may be modified by the issuance of a employee manual. In order to sue under such a provision the employee must prove these elements of the cause of action: (1) that a statement (or statements) in an employee manual or handbook or similar document amounts to a promise of specific treatment in specific situations, (2) that the employee justifiably relied on the promise, and (3) that the promise was breached.

These obligations necessarily arise when the employer makes promises of specific treatment in specific situations. And this obligation may arise even though the manual or handbook contains language to the effect that the employee works at will of the employer. The language or situations that can give rise to such an obligation are very fact-specific. Accordingly, even when the employer has a competent human resources manager or department, it behooves the employer to get the employee manual or handbook reviewed by an attorney. Such a review would not only foreclose future problems but also would provide the employer guidance on lawful policies. Themis Litigation Group regularly performs this service at a very modest cost to the employer. Prudence, in this instance, need not be expensive.