How A Policy Change Can Trigger A Breach Of Contract Claim — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

How A Policy Change Can Trigger A Breach Of Contract Claim

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Don't assume that employing workers at-will or reserving your right to modify a policy will enable you to eliminate at any time a policy that confers an employment benefit. Read why one company may be held liable for breach of contract.


When three employees were hired as sales reps, they each signed an agreement that the company would pay commissions according to a compensation plan, which the company reserved the right to modify. The employees or the company could terminate the agreement without prior notice. The plan stated that failure to meet quotas was grounds for discipline, up to and including discharge. It also provided that sales quotas would be reduced by 15% for employees who reached the age of 55 with 15 years of service, and by another 25% for sales reps who reached the age of 60 with 20 years of service.


Many years later, when the three sales reps met the age and length of service requirements, ...(register to read more)

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