Lexis Nexis - Case Brief

Not a Lexis Advance subscriber? Try it out for free.

Law School Case Brief

Orr v. Westminster Vill. N. - 689 N.E.2d 712 (Ind. 1997)

Rule:

Indiana recognizes two basic forms of employment: (1) employment for a definite or ascertainable term; and (2) employment at-will. If there is an employment contract for a definite term, and the employer has not reserved the right to terminate the employment before the conclusion of the contract, the employer generally may not terminate the employment relationship before the end of the specified term except for cause or by mutual agreement. If there is no definite or ascertainable term of employment, then the employment is at-will, and is presumptively terminable at any time, with or without cause, by either party. 

Facts:

After employees, Lee Orr, Alfred Smith, and William Robinson, were found in the attic and on the roof of the building of their employer, Westminster Village North, Inc. (Westminister), they were terminated. Although Westminister suspected that the employees had been smoking marijuana, Westminister terminated them for being in an unauthorized area and for endangering safety and life, an offense listed in the employee handbook. After the employees filed a complaint alleging breach of contract, the trial court entered summary judgment in favor of Westminister. On appeal, the court reversed the summary judgment, concluding that a genuine issue of material fact existed because the evidence supported the employees' contention that they either began work or continued working for Westminister in reliance upon possible job security provisions found in the employee handbook. 

Issue:

Did the termination of the employees by Westminister constitute a breach of contract between the parties?

Answer:

No

Conclusion:

The court re-affirmed the vitality of the employment-at-will doctrine in Indiana and the general rule that adequate independent consideration was necessary to convert an at-will relationship into an employment relationship requiring an employer to discharge an employee for good cause. The court declined to construe the employee handbook as a unilateral contract. Indiana recognizes two basic forms of employment: (1) employment for a definite or ascertainable term; and (2) employment at-will. If there is an employment contract for a definite term, and the employer has not reserved the right to terminate the employment before the conclusion of the contract, the employer generally may not terminate the employment relationship before the end of the specified term except for cause or by mutual agreement. If there is no definite or ascertainable term of employment, then the employment is at-will, and is presumptively terminable at any time, with or without cause, by either party. 

Access the full text case Not a Lexis Advance subscriber? Try it out for free.
Be Sure You're Prepared for Class