Handbooks, Contracts and At-will Employment

Florida is an at-will employment state. This means an employer in Florida is free to end or modify the employment relationship and its terms at any time for any reason, or no reason, provided the reason is not illegal. Still, it is important to consider that the at-will presumption may be negated in whole or in part, intentionally or inadvertently, when contradictory language is expressed in employee handbooks, work rules and policies, or written or oral employment contracts and other communications from the employer. 

Employee handbook policies which promise job security through probationary periods, progressive discipline, and express termination procedures like written notice before discipline and dismissal, can create contractual obligations if the handbook lacks a clear disclaimer. To avoid confusion, the disclaimer should affirm that the handbook is not a contract and the employer is free to modify terms of employment contained within. Despite such disclaimer, handbook language may still constitute unchangeable terms of employment where (1) the terms are definite, (2) the terms are communicated to the employee, and (3) the employee accepts the terms by working for the employer. For instance, if a handbook contains a paid time off (PTO) policy that unconditionally promises to cash out PTO without restriction, that constitutes a binding contract. As a result, when the employee resigns, with or without notice, or is terminated with or without cause, the employer must cash out the employee’s PTO. Changes to such policy may be prospective only.

Contractual obligations can also be created inadvertently by offer letters, oral promises, written and oral contracts, and informal writings made by supervisors in emails and texts when supported by consideration and relied upon. To avoid creating contractual rights which negate at-will employment, offer letters should state that employment is conditional and at-will. If the employer promises employment of a defined period of time or agrees to provide notice of a defined duration before termination or promises to limit termination without notice to certain scenarios, these provisions will abrogate the at-will employment in whole or in part.   

To avoid unintended commitments, employers should communicate an offer of employment clearly and in writing with special attention to duration, compensation, responsibilities, and termination. A written employment contract should be used when the agreed arrangement:

• is for a specific fixed period of time including a period of time;
• contains unique terms like guaranteed severance pay, notification periods, or limitations on termination without cause;
• is intended to protect company assets (through noncompete, nonsolicitation, confidentiality and trade secret provisions); or
• involves a highly paid employee.