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THE CASE OF FRANK

FACTS

Frank has been employed by a hotel in Napa Valley, California as a driver of their shuttle service since 2012. He has been employed under an employee at will arrangement and has been a model worker ever since. Over the past five years, and pertinent to this analysis, Frank has gained substantial weight which he claims is a result of food addiction. Frank is a member of ABA and is undergoing therapy. His obesity has drawn the attention of Jesse the supervisor. He has expressed his concerns to Frank much to his displeasure. In order to get a better deal on insurance claims, Jesse comes up with a policy which could see Frank get fired if he does not adhere to them. This leads to a dispute and the issue at hand.

ISSUES

1. Whether Jesse as the manager of the hotel can terminate Frank’s employment based on the threats he made.
2. Whether Frank can sue the hotel as he has threatened to do so.

ANALYSIS AND RULE

The general rule is that: where the employee is employed on an “at-will employee” basis, the employer can dismiss him/her at any time and for any reason. As provided for under the Labor Code; an employment where there are no specified terms, the contract may be terminated at the will of either party on notice to the other party (Cal. Lab. Code §2922). It is therefore understood that both parties to the employment contract can at any time opt-out of the agreement. Such an action should be done with notice of the other party.

There are exceptions to this general rule. First, the rule shall not apply where there is an implied contract where the employer cannot dismiss the employee without showing due cause. In this case, the contract is implied as there is no signed agreement but there is a mutual understanding to that respect. As was held in Foley v. Interactive Data Corp the contract can arise where the employee knows that certain acts or omission to act will lead to termination of the contract (Foley v. Interactive Data Corp. 1988). Also, there can be an implied contract where the employer releases official information listing certain grounds that would lead to dismissal. These grounds or stipulations will amount to grounds for “good cause.” An employee who has not breached these grounds will amount to unfair dismissal on grounds that there was no due cause for dismissal (Pugh v. See’s Candies, Inc. 1981).

Second, the rule cannot apply where the employer is in breach of an implied contract for good faith and fair dealing. It is widely appreciated that every employment contract in the United States places a duty on the employer to act in good faith and in line with fair dealing. The implied covenant of good faith and fair dealing requires that the parties abstain from doing anything that will harm the rights of the other party to the contract (Cleary v. American Airlines, Inc. 1980). Good faith requires the employer to be honest in his/her dealing with the employee, while fair dealing binds the employer to act in furtherance of the spirit of the covenant. The employer cannot use his/her power to abuse or interfere with the employee’s rights in the contract.

Third, the rule does not apply where dismissal is against public policy. This exception seeks to protect the employee where he/she is under threat of dismissal for breaching terms which would be illegal or against public policy. Dismissal that would amount to a fundamental breach of public policy is not only unfair but also a violation of the employee’s rights. This will however require proof that there was a fundamental breach of public policy (Tameny v. Atlantic Richfield Co. 1980) The employee should show proof of a violation of public policy. The dismissal will be held to be against public policy where it breaches the constitutional rights of the employee (Petermann v. International Brotherhood of Teamsters, 1959). 

Lastly, the rule will not apply where the dismissal is fraudulent or arises out of misrepresentation. In this case, the employee has to show proof of such fraud or misrepresentation. For one to be held liable for fraud the person alleging has to raise proof of intent to defraud to succeed. The employee cannot be dismissed on account of a misrepresentation on which he acted upon (Molko v. Holy Spirit Assn. 1988).

Frank has threatened to sue, the hotel could expect a suit of constructive dismissal. Constructive dismissal occurs where the employer makes working conditions unbearable to the employee such that the employee has no option but to resign (Brady v. Elixir Industries 1987). For the employee to successfully sue for wrongful constructive discharge, he/she must show that the employer intentionally created unreasonable working conditions and that in normal circumstances, the employer would not terminate the employee. Whereas the workers are not guaranteed a working environment free from stress, the working conditions should be excessively harsh even to the ordinary worker (Goldsmith v. Mayor and City of Baltimore 1993). The working conditions should also be of a continuous nature and not a one-off action. The conditions should also appear unreasonable to the ordinary employee. This means that when a reasonable person in the same working conditions is faced with the harmful conditions, he/she will have no alternative but to resign (Rochlis v. Walt Disney Co. 1993).

CONCLUSION

In the present case, Jesse seeks to get a cheaper insurance coverage plan for the hotel. As a result, he announced new rules on health and worker conduct. It is as a result of these rules that Frank feels that he is targeted and that Jesse seeks to fire him. Although they are under an “at-will employment” contract and any party can opt-out of the contract, Jesse cannot dismiss Frank without due cause. It is important to note that Frank is a member of the ADA and is currently undergoing therapy for food addiction. If Frank sacks Jesse the dismissal will be seen as discriminatory and hence against public policy. It will also be seen as a breach of fair dealing as the stipulations published by Jesse can be seen as actively targeting Frank. Furthermore, Frank could successfully sue for constructive discharge. Before putting up the notice Jesse and Frank have argued over Franks weight even though no incidents have occurred yet. Also, the requirement stated is unreasonable as Frank will surely fail to meet the terms stipulated and have no choice but to resign. To avoid a lawsuit, Jesse should revoke the notice and if necessary, set more reasonable terms.

 

Works Cited.

 

California State, Legislature, California State Legislature, 2017. 

Court of Appeal, Fourth District, Division 2, California. Brady v. Elixir Industries California Appellate Reports, Fourth Series (1933-2016) Vol. 19, 1987 pp. 1299.

Court of Appeal, Second District, Division 1, California. Cleary v. American Airlines, Inc. California Appellate Reports, Fourth Series (1933-2016) Vol. 27, 1980, pp. 722.

Court of Appeal, Second District, Division 2, California. Petermann v. International Brotherhood of Teamsters California Appellate Reports, Fourth Series (1933-2016) Vol. 19, 1959 pp. 184.

Court of Appeal, Second District, Division 2, California. Tameny v. Atlantic Richfield Co. California Appellate Reports, Fourth Series (1933-2016) Vol. 27, 1979. Pp. 167.

Court of Appeal, Second District, Division 3, California. Jeffrey A. Rochlis v. The Walt Disney Company California Appellate Reports, Fourth Series (1933-2016) Vol. 19, 1993 pp. 201.

Court of Appeal, Second District, Division 3, California. Molko v. Holy Spirit Assn California Appellate Reports, Fourth Series (1933-2016) Vol. 19, 1988 pp. 1092, 1108.

Court of Appeals of California, First Appellate District, Division 3. Tameny v. Atlantic Richfield Co. California Courts of Appeal Cases Volume 203, 1988, pp. 748.

Supreme Court of California Cases, Foley v. Interactive Data Corp. Supreme Court of California Decisions Vol. 47, 1988, pp.733

United States Court of Appeals, Fourth Circuit. Goldsmith v. Mayor and City of Baltimore. Federal Supplement vol. 987, 1993 pp.1064, 1072

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