How Would You Rule?
By Catherine Stuckart
More than likely you have been an employee at some point in your life. Maybe you feared being terminated (fired), or have had that experience. Or did you ever wonder what your rights are as an employee? The laws vary state-to-state, and have changed over time.
A major issue in employment law is whether or not a contract is formed between employer and employee. Contract law was mostly based on old English common law. Forming any binding agreement required offer, acceptance of the offer, and consideration. Consideration means that there was something of value involved.
In the past, employees had little protection against being terminated for any or no reason. A valid contract meant that an employee could go to court for breach (violation) of that employer-employee agreement.
A Washington State case illustrates modern judicial thinking on employment contracts, employee rights and employer responsibilities. It also shows how much apart legal thinking can be from one court to another.
Here’s the facts. A woman was hired as a bartender for a restaurant that served alcohol. Her employer gave her an employee handbook to review. She signed a receipt that she had read and understood the handbook.
A new handbook came out every year but the woman (Employee) was not given any copies of the new handbooks. About seven years later, she was given an alcoholic beverage handbook, for which Employee signed a receipt again, and received training.
One fatal night, Employee visited the restaurant while off-duty, with another female friend. At closing time, her companion and she went into the lounge for one last drink.
The on-duty bartender for the lounge had been having trouble with a table of rude customers. One man (Customer) at the table became angry because his group had been denied the one last drink Employee and friend had been given. The bartender had several times asked for assistance from the supervisor.
Employee and Customer exchanged rude remarks. The supervisor asked the group to leave. Then Employee told the group to go, and started picking up glasses. Customer hit Employee. She fell to the floor.
That started a fight, the details of which are confused. When the fight ended, Employee and her friend suffered minor injuries. Customer went to a hospital for lacerations (cuts) and a fractured ankle. The supervisor noted in the manager’s log that Employee had been in a fight that Saturday night.
On Monday, the manager began an investigation. He talked with a number of people who had been in the fight or witnessed it. On Tuesday, the manager spoke with two higher-up managers. He then terminated Employee.
Soon after the firing, a psychiatrist diagnosed Employee with acute traumatic stress syndrome. She was unable to work as a bartender any longer.
Employee then filed a lawsuit for breach of employment contract and a personal wrong (tort.) The judge allowed money damages for emotional distress. The tort claim was dismissed.
The jury found in favor of Employee and awarded her $55,000 for economic damages, and $75,000 in non-economic damages, plus $8,000 in attorney fees.
The restaurant went directly to the highest court in Washington State (Supreme Court.) That court was faced with a number of questions. Was there an employment contract? This matters, because the employee handbook and the alcoholic beverage handbook both provided for immediate termination if an employee got into a fight The second handbook allowed for immediate firing for a fight on the premises (on restaurant grounds.)
Do you think there was a contract?
In contract law, the devil’s in the definitions. The Supreme Court defined a “fight” as “…a hostile physical encounter between two or more persons.” It was not clear at trial that Employee engaged in fighting, or could be blamed for the encounter.
Under the law, the Employer here had an obligation to justify the firing of Employer with substantial evidence.
Do you think there was enough evidence to justify firing Employee?
Finally, traditional contract law does not permit recovering damages for emotional distress in a breach of employment matter.
Should Employee be allowed to keep her award for such distress under the facts of this case?
Do you think there should be another trial? Why?
To find out what the Supreme Court ruled, go to page _.