Vol. 14, No. 4, Pg. 26. Employee handbooks: Are they worth the risk?.

AuthorBy Sandi R. Wilson

South Carolina Lawyer


Vol. 14, No. 4, Pg. 26.

Employee handbooks: Are they worth the risk?

26Employee handbooks: Are they worth the risk?By Sandi R. WilsonSouth Carolina has long recognized the doctrine employment at-will in which the employment relationship may be terminated by either party at any time for any reason or for no reason at all. However, several exceptions to this rule have been recognized. One such exception provides that an employee's at-will status may be altered by the employer's publication of an employee handbook. Small v. Springs Indus., Inc., 292 S.C. 481, 357 S.E.2d 452 (1987). In Small and its progeny, South Carolina courts provided employers with guidance on how to disseminate employee handbooks without inadvertently altering the at-will status of their employees. Despite this guidance, two recent appellate decisions demonstrate that it can be extremely difficult for employers to show, as a matter of law, that an employee handbook does not create a binding contract of employment with their employees.

27On February 11, 2002, the South Carolina Supreme Court issued its decision in Conner v. City of Forest Acres, 348 S.C. 454, 560 S.E.2d 606 (2002), in which the plaintiff, Evelyn Conner, alleged a cause of action for breach of contract on the basis of an employee handbook. The defendant, the City of Forest Acres, argued that the handbook had not created a contract of employment with Ms. Conner as a matter of law, and the trial court agreed. On appeal from the trial court's grant of summary judgment, the South Carolina Supreme Court determined that a triable issue of fact existed with respect to the contract's alleged existence.

Subsequently, on October 28, 2002, the South Carolina Court of Appeals issued an opinion involving the alleged breach of an employment contract on the basis of an employee handbook. In Baril v. Aiken Regional Medical Centers, No. 3561 (S.C. Ct. App. Oct. 28, 2002), the Court of Appeals determined that the handbook promulgated by the defendantemployer, Aiken Regional Medical Centers, may have created a contract of employment between the hospital and the plaintiff, Marolyn Baril. Both of these cases are notable because in each case the defending employers presented evidence that they had followed the primary guidelines set forth in Small and its progeny.

As a result of the Conner and Baril decisions, most claims for breach of contract on the basis of an employee handbook will, in all likelihood, now be decided by a jury. The Court of Appeals' decision in Baril may also provide plaintiffs who are either unable or unwilling to obtain comparable employment with a basis for obtaining financial redress, despite their arguable failure to mitigate their damages. Additionally, the Court's recent decision in Drew v. Waffle House, Inc., No. 25532 (S.C. Sup. Ct. Oct. 7, 2002), will allow some plaintiffs to argue that they are entitled to front pay awards that extend to their expected age of retirement. Thus, not only are more handbook cases likely to go to a jury, the ability of plaintiffs to obtain significant damages likewise has increased

This article will review the history of South Carolina handbook law and the practical ramifications of the recent appellate decisions in Conner and Baril. The artide will also discuss how employers can attempt to avoid creating alleged contracts of employment through the dissemination of employee handbooks and forestall related claims that may arise as a result of these recent decisions.

An employee handbook can be a valuable source of information and direction for employees. It can also help ensure consistent employment decisions that may limit discrimination claims and ward off union campaigns. However, there are risks associated with the publication of an employee handbook. Specifically, a jury may determine that the handbook created a contract of employment between the employer and the employee and that the terms of that contract were breached. Thus, an

28employer who does not intend to create a contract of employment through its employee handbook should carefully draft and adhere to any policies or procedures included in the handbook.

  1. n almost every case in which a South Carolina court has issued a decision discussing a plaintiff's cause of action for alleged breach of contract on the basis of an employee handbook, the decision begins with the presumption that the employee's...

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