Wrongful Discharge

• Author: Laura M. Franze
• Pages: 217-269

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Chapter 3

WRONGFUL DISCHARGE

By Laura M. Franze

3:1. INTRODUCTION

A. Scope of Chapter

B. Overview of “Employment At-Will” Doctrine in Texas

3:2. WRITTEN CONTRACTS

A. Written Contracts

1. Generally

2. Contract Formation

B. Contract Based on Written Term of Salary—The “English Rule”

C. Special Contract Terms

1. Good Cause for Discharge

2. Satisfaction Clauses

3. Notice Provisions

D. The Parol Evidence Rule

3:3. ORAL CONTRACTS—CONTRACT FORMATION

A. Generally

B. Oral Statement of Offer Must Be Clear and Definite

C. Indicating an Intent to Be Bound to a Specific Term of Contract

D. Limiting the Right to Terminate At-Will

E. Attributable to Employer

F. Accepted by Employee

G. With Consideration

3:4. AFFIRMATIVE DEFENSE TO ORAL CONTRACT CLAIM: THE STATUTE OF

FRAUDS

A. Generally

B. Applying Statute of Frauds to Promise of Employment Until Retirement Age

Texas employmenT law 3-218

C. Applying Statute of Frauds to Promise of Lifetime Employment

D. Applying Statute of Frauds to Promise of Employment so Long as Work Is Satisfactory

E. Applying Statute of Frauds to Promise of Discharge for Cause Only

3:5. IMPLIED CONTRACTS OF EMPLOYMENT

A. Contract Formation Required

B. Handbooks or Policy Manuals

1. Generally

2. Employment Policies

3. General Rule: Handbooks Are Not Contracts

4. Cases Where an Exception to General Rule Was Found

5. Effect of Disclaimer

C. Implied Contracts Based on Other Sources

1. Implied Promise of Prospective Employment

2. Employer Practices, Context, or a Combination of Factors

3:6. BREACHES OF EMPLOYMENT CONTRACT

A. Overview

B. Employer Breach

C. Employee Breach

3:7. THIRD PARTY INTERFERENCE WITH EMPLOYMENT CONTRACTS

3:8. REMEDIES IN CONTRACT CLAIMS

A. Overview

B. Reinstatement

C. Past Lost Wages (Back Pay)

D. Future Lost Wages (Front Pay)

E. Loss of Earning Capacity/Mental Anguish

F. Duty to Mitigate Lost Wages

G. Punitive/Exemplary Damages

3:9. QUASI-CONTRACT CLAIMS: PROMISSORY ESTOPPEL

A. Elements of Claim

B. Statute of Frauds and Promissory Estoppel

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C. Independent Action vs. Defensive Plea

1. Estoppel as Defensive Plea

2. Estoppel as Independent Action

D. Estoppel in Public Employer Context

E. Damages Available in Promissory Estoppel Claims

3:10. DISCHARGE IN VIOLATION OF IMPLIED COVENANT OF GOOD FAITH

AND FAIR DEALING

3:11. DISCHARGE IN VIOLATION OF COMMON LAW PUBLIC POLICY—SABINE

PILOT

A. Overview

B. Elements of a Sabine Pilot Claim

1. Discharge or Adverse Employment Action

2. “For the Sole Reason”

3. Refusal to Commit Illegal Act

a. Refusal to Commit

b. An Act Illegal Under Criminal Law

c. Requested by the Employer

C. Cases Where Sabine Pilot Doctrine Held to Apply

1. Refusing to Violate Environmental Laws

2. Refusing to Falsify Records

3. Refusal to Refrain From Reporting Misconduct

4. Refusal to Commit Act of Misprision or Make Criminal Misrepresentations

5. Investigating or Questioning the Legality of Employer Instructions

D. Cases Where the Sabine Pilot Doctrine Was Found Not to Apply

1. Reporting an Illegal Act (Whistleblowing)

2. Being Asked Not to Report a Crime

3. Exercising a Civil Right

4. Covered Under a Contract

E. Investigating the Legality of a Requested Action

F. No Individual Liability

G. Sabine Pilot Claims Are Subject to Arbitration

H. Public Policy Cases in Other States