In an ideal world, every promise made by an employer would be etched in stone, or at least in writing. A contract that neatly spells out each perk, guarantee of job security, or future prospects within the company would certainly alleviate any miscommunication or uncertainty. Unfortunately, much of what is communicated between employer and employee is implied rather than expressly written. Although it is always advisable, and less ambiguous, to get everything in writing, it isn’t always necessary legally to have it in black and white to enforce an implied contract.
Do you have an implied contract?
An implied contract or promise suggests an obligation between parties when certain conditions exist. To determine whether an implied promise is enforceable, the totality of circumstances must be considered. That includes any documentation that might either support or contradict the promise as well as the actions and statements of both parties.
Example: An employer hires a worker at-will but makes statements to the effect that the employee would work a probationary period of one year for evaluation. At-will employment does not provide such job security, but statements to the contrary could override such an at-will contract if both parties were to proceed under a mutual understanding that the employee would not be fired during probation.
In all states, except Montana, unless otherwise stated in writing, employment is assumed to be at-will. Absent a written contract, if an employer makes statements that promise job security, this would be in conflict with that employer’s right to terminate at-will employment at any time, and for any reason that isn’t otherwise illegal. An employee would have to prove that statements made by the employer implied a promise that was in contradiction to the assumed at-will employment.
For this reason, many employers have moved away from the practice of evaluating new hires through the use of a probationary period. The implication can be easily inferred that the employee’s job is safe at least for the duration of the probation, which conflicts with an at-will relationship.
A court would have to evaluate any documentation that may preclude the job security offered in the above example, such as a disclaimer in an employee handbook. At the same time, such a promise may have induced the employee to leave their former job. The implication is that the employer understood that under the circumstances, per promissory estoppel, “An injustice would result if the promise were not enforced.”
Commitment and consideration
Another identifying aspect of an implied promise is commitment. An intent to act – or not act – in a given manner, in exchange for a promised outcome. To be enforceable, the promise would include consideration, that is, an expectation of something in return. In other words, to be a contract both parties would commit to fulfilling their part of a mutual agreement. A spoken promise from your boss to give you a raise would not only be difficult to prove without any corroborating documentation, it wouldn’t by itself constitute an implied contract without a commitment and consideration.
In essence, a promise is implied when both parties understand the nature of the promise, the expectations of each party for the other, and a commitment to those expectations by both parties. If your employer has made non-written promises to you that do not contradict any written documentation or contract, they can be legally enforced but can be difficult to prove without evidence that a verbal promise had been made to you. An attorney specializing in employment law in the state where you are employed will be able to explain the state laws regarding implied promises. To find out what recourse is available to you, to claim losses due to your employer’s failure to honor an implied promise, seek legal counsel.