What Is An “Implied Employment Contract”?

Submitted by eric on

Most waged employment, with the sole exception of employment in the state of Montana, is at-will employment. This means that an employer or employee can terminate employment at any time without giving a reason.

Most employment does not involve a written contract, but there may be in some cases an “implied contract” which is an implied agreement or agreements about the conditions of employment which may arise due to what has been said or referred to in an employee’s handbook or manual.

Wrongful termination may be proven if it can be shown that an implied contract exists and that this contract has been breached by an employer’s actions.

What is an Example of an Implied Contract?

An implied employment contract is a contract which is presumed to have existed because of spoken assurances or behavior by the employer made over time and on a consistent basis, even if there is no written employment contract. References to conditions of employment in an employee’s manual or guidebook can help to establish that there has been an implied contract in existence.

Can You Be Fired When With an Implied Contract?

Even if it can be proven that there was an implied contract, the reality is that most employment is on an at-will basis. Employers and employees are free to terminate employment at any time.

There are some limitations on at-will employment which prevent employers from terminating employment in certain circumstances.

For example, it is illegal for an employer to fire an employee simply because they belong to a particular category, such as being female, black, old, gay, disabled, etc. It is also illegal for an employer to fire an employee because that employee has exposed wrongdoing by the employer (whistleblowing), or has applied for Family and Medical Leave or workers’ compensation.

How Do You Prove an Implied Contract?

It can be difficult proving an implied contract because it does not involve an agreement that has been written down and signed by both employer and employee.

Instead, to prove that an implied contract exists, the employee must show that there has been a pattern of behavior, including consistent spoken assurances and/or references in an employee manual or guide.

Note that the latter is not in itself an employment contract but a guide to the employee’s responsibilities and duties in a job. An implied contract can generally only be proven if the relationship between employer and employee has been

Get Help With Your Claim

It is generally better to have a written employment contract in place at the commencement of employment where conditions of employment and rights and responsibilities of the employee are spelled out in black and white.

Unfortunately, most employment does not have a written employment contract and at-will conditions prevail. In some cases, when an employee has established a long term relationship with an employer without a written employment contract, an implied employment contract may be assumed to have been in existence.

It may be possible to file a claim against your employer for wrongful termination if you can prove that either your employer acted illegally or had breached the implied employment contract that the employee had assumed existed.

It can be challenging proving the existence of an implied contract. A wrongful termination lawyer can determine whether you had an implied contract while in employment and help you with your claim.

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