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Blundering into Liability: Unwitting Creation of Employment Contracts

Blundering into Liability: Unwitting Creation of Employment Contracts


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Robert E. Gregg, JD
 
You think you are an employer at will. Think again! This article discusses how employers too often create binding contracts of which they are completely unaware—until the employee or former employee seeks to enforce the “contract” and collect on the liabilities the organization did not know it had. Such lack of awareness may lead to the creation of full-blown contracts of employment, or a variety of mini-contracts that can be enforced for smaller, specific issues, or huge liability for wages and commissions. It may even eliminate the ability to enforce the organization’s work rules and discipline. This article focuses on the contract area.