Earlier this month, the Jefferson County Court of Appeals
reversed an employer’s summary judgment on an employee’s claim that the
employer should be estopped from terminating her after its CEO had earlier implicitly
consented to her living arrangements before she moved in with her boyfriend in
reliance on that acquiescence. Trehar
v. Brightway Ctr., 2015-Ohio-4144. Even though
the employer’s handbook contained a strong and standard employment-at-will
disclaimer, the Court observed that promissory estoppel constitutes an
exception to employment at will. In
addition, the CEO’s silent acquiescence to her announcement about moving in
with her boyfriend constituted consent where he otherwise had a duty to speak
against it if he intended to terminate her employment on that basis. His subjective intent on the issue is not
controlling if a reasonable employee would have interpreted his silence as
consent. Moreover, even if the employer
were estopped from terminating the plaintiff for moving in with her boyfriend
after the CEO had consented to it, her employment would otherwise remain at
will.
According to the Court’s opinion,
the plaintiff worked for a Christian non-profit organization. The plaintiff testified that she informed the
CEO that she planned to move in with her boyfriend in a month and he
congratulated her. He later approved her
absence from a work-related event in order to help her boyfriend move into
their new home. About two weeks later,
the subject came up during a work lunch. (The CEO claimed that this was the
first he learned of her living arrangements.
He claimed that he only knew that the boyfriend was moving, but there were
emails to him about her moving as well, etc.). A month later, the Board of Trustees
suspended her for a month with pay while she considered whether to move out or
get married. When she did not move out
or get married, her employment was terminated at the end of the month and she
brought suit asserting that the employer should be estopped from terminating her
for living with her boyfriend out of wedlock when she had relied to her
detriment on the CEO’s prior representations.
The Company’s employee handbook
contained a standard employment-at-will disclaimer that an employee can be
terminated at any time and for any reason regardless of any policies or verbal
statements to the contrary. It also
provided that only written agreements signed by the CEO can modify at-will
employment. The Court noted that this
would not affect her promissory estoppel claim:
The handbook does little more than
re-emphasize that [the plaintiff] was an employee-at will. And an exception can
be made to employment at-will by means of promissory estoppel. Moreover, if in
fact promissory estoppel exists in this case it would not alter [her] status as
an employee at-will in all other respects. [The employer] could still fire her
for any other reason.
The Court
distinguished this case from the typical one where a plaintiff relies on
compliments about job performance or discussions of career development to infer
a promise of continued employment.
Without “clear, unambiguous promises of continued employment,” a plaintiff cannot
rely on the doctrine of promissory estoppel to preclude an employer from
terminating her under any circumstances.
In this case, however, there is evidence [the CEO] silently
assented to [the plaintiff] moving in with her boyfriend and his silence can be
construed as a promise that no adverse employment action would come as a result
of her move. Other cases have stated that silence can be sufficient to
establish a promissory estoppel claim.
Furthermore, even though the plaintiff did not explicitly
seek the CEO’s permission and he did not specifically state to her that she
would not be terminated for moving in with her boyfriend, his silent
acquiescence to her news constituted sufficient consent on which she could base
a promissory estoppel claim:
Promissory or equitable estoppel arises when “ * * * ‘one, by
his acts, representations, or admissions, or by his silence when he ought to
speak out, intentionally or through culpable negligence induces another to
believe certain facts to exist, and such other rightfully relies and acts on
such belief, so that he will be prejudiced if the former is permitted to deny
the existence of such facts.
In other words,
In essence, the expression of estoppel in the form of a rule
is that one party will not be permitted to deny that which, by his words, his
acts, or his silence (when there was an obligation to speak), he has
induced a second party reasonably and in good faith to assume and rely upon to that
party's prejudice or pecuniary disadvantage.
While a jury may reach different inferences and evaluate the
parties’ credibility, at this point a material factual dispute on these issues
precluded a summary judgment.
It is possible that these actions and inactions might be construed
as a promise that [the plaintiff] would not be fired for her cohabitation and
that [she] relied on [the CEO’s] silence on the issue. Reasonable people could
conclude that if [he] intended that [her] cohabitation would result in her
termination, he should have spoken.
In a promissory estoppel claim, the employer’s subjective
interpretation of the alleged promise does not control. Mers at 104-105.
Instead, “the employer's representation is to be determined by what the
‘promisor should reasonably expect’ the employee to believe the promise
means if expected action or forbearance results.” (Emphasis sic.); Id.
at 105. Assuming as true that [the plaintiff] told her boss she was going to
move in with her boyfriend and he congratulated her instead of objecting to the
move or advising her she could suffer adverse employment consequences, it may
be construed as reasonable for her to believe she would not be fired for
cohabitating with her boyfriend.
NOTICE: This summary is designed merely to inform and alert you
of recent legal developments. It does not constitute legal advice and does not
apply to any particular situation because different facts could lead to
different results. Information here can be changed or amended without
notice. Readers should not act upon this information without legal advice. If
you have any questions about anything you have read, you should consult with or
retain an employment attorney.
