Rescinding Job Offers in At-Will Employments in Florida

Today’s labor market can be generally characterized by high job turnover.  Nationwide, in November 2010, over four million employment positions were filled and nearly an equal number of employment relationships were severed.[1]  Understanding the relationship between employers and their current and prospective employees is very important in a national labor market with a job turnover rate of approximately two percent of the labor force per month.[2]  The predominant and default employment arrangement in the United States is “Employment-at-Will.[3]  In Florida, an employment agreement that does not provide for a specified duration of employment, in the absence of surrounding facts that could be construed as a durational restriction, is recognized as an agreement to employment at will.  See Savannah, F. & W. RY. CO. v. Willet, 31 So. 246, 314 (Fla. 1901).  Employment-at-will allows for the termination of employment at any time by either the employer or employee.  See e.g. Demarco v. Publix Super Markets, Inc., 360 So. 2d 134, 136 (“The established law is that where the term of employment is discretionary with either party or indefinite, then either party for any reason may terminate it at any time and no action may be maintained for breach of the employment contract.”)

 In a labor market with high job turnover, employers and employees are constantly creating new employment relationships and severing previous employment relationships.  When an employee makes a transition from an existing employer to a new employer, they usually give notice to their existing employer and effectively sever the employment relation with their existing employer.  The at-will doctrine allows employees the flexibility to do this.  The drawback to this flexibility comes when the employee relies on an offer for new employment and then the offer is rescinded by the prospective employer.  This situation has received varied treatment across jurisdictions.

 Modern opinions that deal with this situation often cite to the reliance provision in either the 1st or 2d Restatement of Contracts.  See e.g. Grouse v. Group  Health Plan, Inc., 306 N.W. 2d 114, 116 (Minn. 1981). §90 of Restatement 2d of Contracts provides that, “[a] promise which the promisor should reasonably expect to induce action or forbearance on the part of the promisee…and does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise…”.  Section 90 of the Restatement 2d leaves the Court’s to decide whether or not an offer of Employment –at-will which induces an employee to resign from their current job or forgo an employment opportunity with another employer can invoke liability promissory estoppels theories.  (For more on promissory estoppel in Florida see 22 Fla. Jur 2d Estoppel and Waiver § 46)

 In Grouse, the court held that promissory estoppel is invoked when an employer makes a good offer of employment and the potential employee relies on this offer in choosing to leave their current job or turning down another job offer.  Grouse, 306 N.W. 2d at 116.  The Minnesota Supreme Court suggested reliance damages in Grouse as the wages Plaintiff Grouse would have kept if he had not quit his previous employment or had taken the another offer he had been given.  Id.  Grouse holds that an offer of employment also requires the employer to give the prospective employee a good faith opportunity to perform the job.  Id.

Florida’s Fourth District Court of Appeal addressed the same issue of promissory estoppel for reliance on an offer of employment in Leonardi v. City of Hollywood, 715 So. 2d 1007, 1008 (4th Fla. Dist. Ct. App. 1998).  In Leonardi, the trial court ruled in favor of the plaintiff, who had quit his job after receiving an offer of employment which was later rescinded by the city. Id. at 1008.  The trial court awarded ten dollars in damages to plaintiff and both parties appealed.  Id.  The District Court of Appeal found that §90 applied to Plaintiff’s actions, but did not find the ruling in Grouse persuasive.  Id. at 1009.  Instead the 4th District decided plaintiff’s claim for damages based on reliance under §90 was unreasonable since plaintiff could have been fired from his previous job at any time.  Id. at 1010.

 Thus, the prevailing rule in Florida is that an offer of at will employment does not constitute a promise which induces reasonable reliance when the prospective employee is leaving another at will employer.

[1] Job Openings and Labor Turnover Summary- November 2010, Bureau of Labor Statistics, http://www.bls.gov/news.release/jolts.nr0.htm

[2] Based on job turnover rate divided by civilian labor force projection in 2008, http://www.bls.gov/news.release/ecopro.t01.htm

[3] Muhl, Charles J.  “The Employment-at-Will Doctrine: three major exceptions”

http://www.bls.gov/opub/mlr/2001/01/art1full.pdf