The Contract Disclaimer And How Duldulao And Doyle Affect Your Company

» Articles » Employment & Labor Articles » Article

July 10, 2015


In Duldulao v. Saint Mary of Nazareth Hospital Center, 115 Ill.2d 482, 505 N.E.2d 314 (Ill.S.Ct.  1987), the relevant issue brought before the Illinois Supreme Court was whether the employee handbook that did not contain a disclaimer created contractual terms binding defendant to a particular
termination procedure.

We learned from Duldalao that n employee handbook or other policy statement creates enforceable contract if (1) the language of the policy statement contains a promise clear enough that an employee would reasonably believe that an offer has been made; (2) the statement must be disseminated to the employee in such a manner that the employee is a ware of its contents and reasonably believes it to be an offer; (3) the employee must accept the offer by commencing or continuing to work after learning of the policy statement.

Twelve years after Duldalao, the Illinois Supreme Court was faced with a new issue in Doyle v. Holy Cross Hospital, 186 Ill.2d 104, 708 N.E.2d 1140 (Ill.S.Ct. 1999) when the employer unilaterally changed its existing employee handbook. In Doyle, the employer issued to existing employees
and new hires an employee handbook, which contained a number of policies and provisions, including a discharge policy. There was no disclaimer in the original employee handbook.

Twelve years later, the employer added a disclaimer to its employee handbook. The Supreme Court concluded that the employer’s unilateral modification to the employee handbook lacked consideration and therefore was not binding on the original employees because modification of an existing contract requires consideration to be valid and enforceable, and held that after an employer is contractually bound to the provisions of an employee handbook, unilateral modification of its terms by the employer to an employee’s disadvantage fails for lack of consideration. Importantly, continuing to work is not sufficient consideration for the modification of an existing employee handbook.

Example Language:
This Employee Handbook is meant to provide guidelines and expectations to employees in order to assist employees to better perform their job duties. This Handbook is not an exhaustive list of every workplace rule and policy, but rather a guide to employees on commonly raised questions.

THIS EMPLOYEE HANDBOOK IS NOT AN EMPLOYMENT CONTRACT.
This Employee Handbook does not establish a contract (express or implied) between  [*insert Company name*] and any employee regarding terms and conditions of employment.

EMPLOYMENT AT WILL RELATIONSHIP: This Employee Handbook does not in any way alter the employment-at-will relationship between [*insert Company name*] and its employees. [*insert Company name*] and each employee have the right to terminate the employment
relationship (at any time, with or without cause or notice).

Please be advised that no supervisor, manager, or representative of [*insert Company name*] other than the President has the authority to enter into any agreement with any individual for employment for any specified period of time or to make any promises or commitments contrary
to the foregoing. Any document alleged by any applicant, employee or former employee to include promises, terms and/or conditions of employment not executed and signed by the President will not be enforceable. Further, any employment agreement entered into by the President
on behalf of [*insert Company name*] will not be enforceable unless the agreement is in writing and signed by the President.
[*insert Company name*]


The material appearing in this web site is for informational purposes only and is not legal advice. Transmission of this information is not intended to create, and receipt does not constitute, an attorney-client relationship. The information provided herein is intended only as general information which may or may not reflect the most current developments. Although these materials may be prepared by professionals, they should not be used as a substitute for professional services. If legal or other professional advice is required, the services of a professional should be sought.

The opinions or viewpoints expressed herein do not necessarily reflect those of Lorman Education Services. All materials and content were prepared by persons and/or entities other than Lorman Education Services, and said other persons and/or entities are solely responsible for their content.

Any links to other web sites are not intended to be referrals or endorsements of these sites. The links provided are maintained by the respective organizations, and they are solely responsible for the content of their own sites.