Legal Clinic

Heading Off Employee Dissatisfaction

Whether dealing with a former employee who had expected to receive a bonus or attempting to head off problems by including a legal disclaimer in job descriptions, HR leaders need to keep in mind that state laws vary tremendously.

Monday, February 25, 2008
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Many employers are approaching or have just completed bonus season -- a time when representations are tested, dissatisfied employees vote with their feet and employers contemplate how best to fill gaps in their staff. The questions addressed this month pertain to those thorny issues. Specifically, we begin with a former employee's right to review personnel information and then consider disclaimer language on a job description.

Question: An employee resigned and timed his resignation with what he believed was the bonus eligibility date. The company decided not to award him the bonus. He now would like to review his 2007 evaluation and ranking to understand why. Must the company provide this information?

Answer: An employee's right of access to a performance evaluation or other personnel records depends on the employer's policies and state law. Some states, such as New York and New Jersey, are silent as to whether an employee has a right of access to personnel information. In these states, you would have no obligation to provide the employee with a copy of his evaluation and ranking, except to the extent you had a policy granting access to a former employee.

Other states grant employees the right to access certain personnel records. For example, in Illinois, the Personnel Record Review Act grants an employee the right to inspect his or her personnel file up to twice per year. This right of inspection extends to former employees, provided they were terminated within the year preceding the inspection request. 820 Ill. Comp. Stat. 40/2 (2008).

The statute allows employees to inspect any documents which "are, have been or are intended to be used in determining that employee's qualifications for employment, promotion, transfer, additional compensation, discharge or other disciplinary action," subject to certain exceptions.

In the situation presented, Illinois law would likely require granting the employee's request to review his evaluation.

It is less clear whether disclosure of ranking would be required, as the question does not provide any detail as to how this information is maintained.

The statutory exceptions to disclosure include "materials related to staff planning" that involve more than one employee, subject to some further qualifications. 820 Ill. Comp. Stat. 40/10. The employer might be able to rely on this exception to avoid disclosing ranking information.

Connecticut also grants employees a right of access to their personnel file. There, the statute similarly grants the employee access to documents "used ... to determine ... additional compensation" of the employee. Conn. Gen. Stat. ยง 17-563a-31-128a (2008). The requested evaluation would likely fall within the statutory requirement.

It is less clear, based on the information provided in the question, whether ranking information would also need to be provided.

As other states may have their own provisions with regard to access to personnel records, it is advisable to consult with local counsel.

Question: The company is considering putting this statement on the job description: "Legal Disclaimer: This is not a contract of employment and job duties and responsibilities may change and additional duties may be requested." Is this legal?

Answer: I am not aware of any legal proscription on a company's ability to include such a disclaimer on a job description. Presumably the company's concern is that its job description not be construed as creating a contract of employment for a definite term or as contractually limiting the scope of responsibilities that can be assigned to an employee.

Whether this company's approach is legally effective to address either of those concerns will depend on state law.

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In most states, the general principle is that employment is at-will and, absent a written agreement, employees have no right to employment for a definite term or under definite conditions. Some state courts, however, have recognized an implied contractual employment relationship where no formal employment contract has been executed. Typically, this situation would arise in the context of a policy manual or some other document creating expectations for the terms of employment.

In New Jersey, for example, courts have long held that promissory language in an employer's policy manual can create a contractual relationship.

As one court explained, "when an employer of a substantial number of employees circulates a manual that, when fairly read, provides that certain benefits are an incident of the employment (including, especially, job security provisions), the judiciary ... should construe them in accordance with the reasonable expectations of the employees." Woolley vs. Hoffman-La Roche, 491 A.2d 1257, 1264 (N.J. 1985).

An employer seeking to avoid any presumption of a contract should include a disclaimer that is clear and unambiguous, typically in different typeface from the rest of the document. See Preston vs. Claridge Hotel & Casino, Ltd., 555 A.2d 12, 14 (N.J. App. Div. 1989).

The disclaimer proposed appears to be both clear and unambiguous, and a bold and/or underlined typeface would enhance its enforceability.

In my experience, however, employers typically do not include such disclaimers on a job description. Rather, to address the concern of unduly limiting the scope of the job, employers will include a catch-all phrase in the job description. For example, job duties might be defined to include a list of particular tasks or functions, concluding with, "other responsibilities as designated in management's discretion."

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