Overview Of The At Will Doctrine
Virginia adheres to the doctrine of employment at will. When the intended duration of an employment contract cannot be determined by a fair inference from its provisions, either party can terminate the contract at will upon giving reasonable notice.
Courts in Virginia interpret an employer’s promise of just cause protection as proof of a fixed, intended duration of employment.
Employees have brought three types of contractual claims in their efforts to rebut
the at-will presumption: (1) reliance, (2) implied in fact, and (3) express modification.
Virginia state courts have vigorously upheld the at-will presumption. However, federal courts in Virginia have sometimes been more willing to recognize contractual modifications of employment at will. Despite these occasional liberal leanings, courts in Virginia have maintained a conservative stance on the issue of employment at will.
The Supreme Court of Virginia has rejected a contractual claim brought by an employee who relied on an offer of at-will employment. See Sartin v. Mazur, 375 S.E.2d 741, 743 (Va. 1989). The plaintiff in Sartin relied on the defendant’s offer of employment by resigning from her current job and incurring relocation costs. Id. at 742.
Nevertheless, the court found it absurd to require an employer, which had changed its
mind after an offer had been made, to employ the applicant for one hour or one day so
that the employee could then be discharged. Id. at 743. The court distinguished its
earlier opinion in Sea-Land Serv., Inc. v. O’Neal, 297 S.E.2d 647 (Va. 1982), in which it
had upheld an employee’s breach of contract claim. In Sea-Land, the employer
breached its promise to transfer the plaintiff to another position within the company
provided she resigned from her current position. Id. at 649. The court held that the
agreement to exchange positions was separate from any contract covering the
particular position involved and therefore was not subject to the at-will presumption. Id.
at 650. In contrast, Sartin involved an offer that had no preconditions, as opposed to a
separate agreement to exchange one job for another within the same company, and is
therefore distinguishable. 375 S.E.2d at 742.
The federal courts in Virginia have not addressed any claims of just cause
protection based on reliance. However, a court in the Western District of Virginia has
indicated in a footnote that the doctrine of promissory estoppel could be used to
enforce promises in an employee handbook. See Thompson v. American Motor Inns,
Inc., 623 F. Supp. 409, 417 n.15 (W.D. Va. 1985). Although the plaintiff in Thompson
did not raise a claim of promissory estoppel, the court noted that the employer “should
have expected its employees to act or to forbear to act in reliance on [the handbook’s
provisions].” Id. Employing similar reasoning, courts in other states have used the
promissory estoppel doctrine to uphold claims of just cause protection for at least some
period of time after an offer has been made. For example, the Minnesota Supreme
Court upheld a reliance claim when an employer revoked an offer of employment
before the plaintiff had assumed the position but after the plaintiff had resigned from his
previous job. See Grouse v. Group Health Plan, Inc., 306 N.W.2d 114 (Minn. 1981).
IMPLIED-IN-FACT JUST CAUSE PROTECTION
Employer statements that do not expressly promise just cause protection may
nevertheless create a fair inference that the employment relationship is not at will.
Claims for implied-in-fact just cause protection typically allege that oral assurances,
written reprimands, or employee handbook provisions prohibit an employer from
discharging the employee at will.
Both the state and federal courts in Virginia have repeatedly denied claims of
implied-in-fact just cause protection based on an employer’s oral assurances. Some
decisions have held that the oral assurances do not sufficiently guarantee a fixed term
of employment. See Addison v. Amalgamated Clothing & Textile Workers Union of
America, 372 S.E.2d 403, 405 (Va. 1988) (rejecting claim based on assurances of
employment for as long as the employee wanted the job and as long as one existed);
Miller v. SEVAMP, Inc., 362 S.E.2d 915, 918 (Va. 1987) (rejecting claim based on
assurance of employment as long as there continued to be adequate federal funding of
the position). Other decisions have noted that even if the oral assurances are enough
to establish implied-in-fact just cause protection, they are barred by the statute of
frauds. See Falls v. Va. State Bar, 397 S.E.2d 671, 672-73 (Va. 1990) (rejecting claim
based on assurance that employment would continue as long as plaintiff’s performance
was satisfactory); Sullivan v. Snap-on Tools Corp., 708 F. Supp. 750, 751 (E.D. Va.
1989), aff’d, 896 F.2d 547 (4th Cir. 1990) (rejecting claim based on assurance that as
long as plaintiff performed his duties to employer’s satisfaction he would be afforded
job security); Derthick v. Bassett-Walker, Inc., 904 F. Supp. 510, 521 (W.D. Va. 1995)
(rejecting claim based on nonspecific, vague and ambiguous statements made in a
variety of contexts over the course of twenty years). The possibility of an
employee’s death, resignation, or discharge within one year does not satisfy the statute
of frauds’ requirement of performance within one year absent an express provision in
the contract that such contingencies constitute full performance. Falls, 397 S.E.2d at
The Virginia Supreme Court has rejected a claim of implied-in-fact just cause
protection based on disciplinary memos issued to an employee. See Graham v. Cent.
Fidelity Bank, 428 S.E.2d 916, 918-19 (Va. 1993). In Graham, plaintiff’s employer
issued a disciplinary memo placing her on ninety days probation. Subsequently, her
employment was terminated before the end of the probationary period. Id. at 917. The
court opined that disciplinary letters should not be construed as contracts for a fixed
period when the employer’s intent to make such a contract is not clear. Id. at 918.
Employee Handbook Provisions
Claims of implied-in-fact just cause protection based on disciplinary procedures
or lists of potential reasons for termination included in employee handbooks have been
rejected by the Virginia Supreme Court. The court typically has found that disclaimers
in the handbooks prohibit any inference that the disciplinary procedures create just
cause protection. See Miller, 362 S.E.2d at 918 (denying just cause protection
because of handbook disclaimer which stated that “[a]n employee may be dismissed at
the discretion of the Executive Director”); Graham, 428 S.E.2d at 918 (holding that
disclaimer which reserves the right to terminate the employment relationship at any
time with or without cause precludes any implication of just cause protection). The
court in Miller stated that it could not imagine a clearer expression of intent to create at will employment than a disclaimer contained in a personnel manual. 326 S.E.2d at
Even in the absence of a disclaimer, the Virginia Supreme Court has refused to
find implied-in-fact just cause protection based on employee handbooks. See Progress
Printing Co. v. Nichols, 421 S.E.2d 428, 436 (Va. 1992). A number of jurisdictions
enforce termination for cause provisions contained in employee handbooks when the
provisions are communicated to the employee in a sufficiently specific manner. Id.
However, the Virginia Supreme Court has unequivocally rejected that approach. Id.
Furthermore, the supreme court has indicated that employee handbooks may not
survive the statute of frauds requirement of a signed writing. See Falls, 397 S.E.2d at
673 (noting that a company logo on a personnel manual did not satisfy the signature
requirement of the statute of frauds).
In contrast to the Virginia Supreme Court, some federal courts in Virginia have
allowed claims of implied-in-fact just cause protection based on employee handbook
provisions to go to the jury. See Frazier v. Colonial Williamsburg Found., 574 F. Supp.
318, 321 (E.D. Va. 1983) (allowing question of whether employment manual constituted
a binding promise that plaintiff could be terminated only for cause to go to the jury);
Barger v. Gen. Elec. Co., 599 F. Supp. 1154, 1163 (W.D. Va. 1984) (holding that issue
of whether layoff and recall policy in employee handbook was contractually enforceable
was for jury to decide). In fact, one federal district court in Virginia has held that
disciplinary procedures in an employee handbook constitute an implied unilateral
contract. See Thompson, 623 F. Supp. at 418. The Thompson court purported to rely
on the Virginia Supreme Court’s decision in Hercules Powder Co. v. Brookfield, 53
S.E.2d 804 (Va. 1949). In Hercules, the court enforced an express promise to pay
severance benefits contained in an employee handbook, even though the employee
claiming the benefits was at-will. The court’s later opinion in Progress Printing takes
pains to explain that the decision in Hercules to enforce the severance pay provisions
was consistent with an at-will employment relationship. See Progress Printing, 421
S.E.2d at 430. However, the federal district courts have used the Hercules holding to
enforce employee handbook provisions, despite the strong commitment to the at-will
presumption expressed in the Virginia Supreme Court’s decisions.
Following the lead of Virginia’s federal district courts, the Fourth Circuit has
found that a personnel manual which intricately detailed disciplinary offenses and
described with particularity the disciplinary response for those offenses created an
implied-in-fact contract. See Bradley v. Colonial Mental Health and Retardation Svcs.
Bd., 856 F.2d 703, 708 (4th Cir. 1988). The Fourth Circuit clarified the type of
disciplinary procedures sufficient to support a claim of implied-in-fact just cause
protection in Sullivan v. Snap-on Tools Corp., 708 F. Supp. 750 (E.D. Va. 1989), aff’d,
896 F.2d 547 (4th Cir. 1990). The court in Sullivan rejected a claim of implied-in-fact
just cause protection, finding that the disciplinary provisions in the employee handbook
lacked the specificity and intricateness of those contained in the manual referred to in
Bradley. Id. at 753. Specifically, the court stated that the procedures were not all-inclusive, did not include the specific discipline for each listed offense, and, most
importantly, did not include any termination for cause language. Id.
The federal courts in Virginia have take a fairly restrictive approach to implied-infact
claims based on employee handbook provisions. The courts have held that no
implied contract arises when an employer does not generally distribute the handbook to
its employees but provides it only on request. See Swengler v. ITT Corp., 993 F.2d
1063, 1070 (4th Cir. 1993). However, if an employer usually provides an employment
policy manual only to supervisors but initiates the distribution of the manual to some of
its employees, an implied contract arises with those employees who receive the
manual. See Seabolt v. Westmoreland Coal Co., 703 F. Supp. 1235, 1241 (W.D. Va.
1989). Like the Virginia Supreme Court, the federal courts in Virginia also have
refused to find implied-in-fact just cause protection when the handbook contains a
disclaimer confirming the employee’s at will status. See id. at 753, Michael v. Sentara
Health Sys., 939 F. Supp. 1220, 1236 (E.D. Va. 1996).
Employers can expressly modify an employee’s at-will status by making oral or
written promises of just cause protection. Claims based on oral modifications are rarely
successful since they are typically barred by the statute of frauds. See Graham, 428
S.E.2d at 918. Additionally, express oral statements that an employee will only be fired
for cause may be inadmissible under Virginia’s parol evidence rule when an employee
later accepts a written offer of employment which contains no promise of just cause
protection. See Swengler, 993 F.2d 1063 at 1069.
The Virginia Supreme Court has held that a written provision in a collective
bargaining agreement which states that an employee will not be dismissed without just
cause rebuts the at-will presumption. See Norfolk Southern Railway Co. v. Harris, 59
S.E.2d 110, 114 (Va. 1950). However, the Virginia Supreme Court has yet to address
whether express promises of just cause protection contained in employee handbooks
rebut the at-will presumption. But see statute of frauds discussion in Falls, 397 S.E.2d
Several Virginia state and federal court decisions have focused on employer’s
attempts to modify handbooks containing written promises of just cause protection.
The Virginia Supreme Court has held that an amendment which changes an
employee’s status to at-will is correctly characterized as an offer which the employee
accepts by returning to work. See Progress Printing Co., 421 S.E.2d at 431. The
federal courts have taken a tougher stance on when an employer can modify an
employee’s at-will status requiring employers to establish the employee’s acceptance of
the amendment. See Thompson v. Kings Entertainment Co., 674 F. Supp. 1194, 1198
(E.D. Va. 1987). Employers must demonstrate that the employee was aware of the
handbook, understood that its terms governed the employment, and worked according
to those terms. Id. The fact that an employee continues to work after receiving an
amendment changing his status to at-will is not dispositive in the federal courts on the
issue of acceptance. Id. at 1199. See also Sullivan, 708 F. Supp. at 752 (determining
that handbook which employee received, relied on, and signed for governed the