Do you have an employee who works under an employment contract? Does the contract provide you with enough flexibility?
For example, have you tied your hands when it comes to work assignments or to whom the employee reports? Is there a mechanism for early termination for cause or other economic reasons?
Don’t let the complexities of contract law trip you up. Have an attorney with labor and employment expertise draft—or at least review—all employment contracts.
Recent case: Michael Barnes signed an employment contract with the Greater Waco Chamber of Commerce. The agreement didn’t specify to whom Barnes was going to report, but Barnes later said he accepted the job because he thought he would report to the chamber’s board of directors.
Later, his employer told Barnes to report to the new CEO. Barnes claimed this was a breach of contract. But the court disagreed. Because the contract didn’t specify reporting responsibility, he didn’t have a breach of contract case. In addition, since he worked under the terms of the contract until he quit (just before it expired), he didn’t have any lost wages or other damages. (Barnes v. Greater Waco Chamber of Commerce, No. 07-50379, 5th Cir., 2007)