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Keywords

contractbreach of contractdamageswillprobationunilateral contract
contractbreach of contractdamageswillprobationunilateral contract

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Pine River State Bank v. Mettille, 333 N.W.2d 622, 115 L.R.R.M. (BNA) 4493

Facts

Richard Mettille was hired by Pine River State Bank in 1978 as a loan officer under an oral employment agreement. After surviving a probationary period, he received a performance review and a raise. In 1979, following an audit that revealed serious technical exceptions in loan files for which Mettille was responsible, he was terminated without the disciplinary procedures outlined in the bank's employee handbook being followed. Mettille counterclaimed after the bank sued him for defaulting on two notes.

Richard Mettille was hired by Pine River State Bank in 1978 as a loan officer under an oral employment agreement. After surviving a probationary period, he received a performance review and a raise. In 1979, following an audit that revealed serious technical exceptions in loan files for which Mettille was responsible, he was terminated without the disciplinary procedures outlined in the bank's employee handbook being followed.

Issue

1) Can a personnel handbook, distributed after employment begins, become part of an employee's contract of employment? 2) Are job security provisions in the handbook enforceable when the contract is of indefinite duration? 3) Was the employee's summary dismissal without following the job termination procedures of the handbook a breach of contract by the employer?

1) Can a personnel handbook, distributed after employment begins, become part of an employee's contract of employment? 2) Are job security provisions in the handbook enforceable when the contract is of indefinite duration? 3) Was the employee's summary dismissal without following the job termination procedures of the handbook a breach of contract by the employer?

Rule

1) Portions of an employer's personnel handbook may become part of the employee's contract if the requirements for formation of a unilateral contract are met. 2) Job security provisions in an indefinite duration employment contract can be enforceable. 3) Procedural restraints on termination contained in the employee handbook are contractually binding.

1) Portions of an employer's personnel handbook may become part of the employee's contract if the requirements for formation of a unilateral contract are met. 2) Job security provisions in an indefinite duration employment contract can be enforceable. 3) Procedural restraints on termination contained in the employee handbook are contractually binding.

Analysis

The court found that the employee handbook's provisions regarding job security and disciplinary procedures constituted a unilateral contract that was binding on the bank. The jury determined that Mettille's termination did not follow the required procedures, and the bank's argument that it could terminate him at will was rejected. The court emphasized that the handbook's provisions were enforceable and that Mettille's continued employment constituted acceptance of the terms.

The court found that the employee handbook's provisions regarding job security and disciplinary procedures constituted a unilateral contract that was binding on the bank. The jury determined that Mettille's termination did not follow the required procedures, and the bank's argument that it could terminate him at will was rejected.

Conclusion

The court affirmed the jury's finding that Mettille was wrongfully terminated and upheld the damages awarded to him, concluding that the bank breached its employment contract by failing to follow the disciplinary procedures outlined in the handbook.

The court affirmed the jury's finding that Mettille was wrongfully terminated and upheld the damages awarded to him, concluding that the bank breached its employment contract by failing to follow the disciplinary procedures outlined in the handbook.

Who won?

Richard Mettille prevailed in the case because the court found that the bank breached its employment contract by not adhering to the disciplinary procedures specified in the employee handbook.

Richard Mettille prevailed in the case because the court found that the bank breached its employment contract by not adhering to the disciplinary procedures specified in the employee handbook.

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