Courts have begun to look at other evidence of a contract beyond a written document between employer and employee. Further, some courts permit a contractual claim by recognizing an implied covenant of good faith and fair dealing as part of the employment relationship. Employee manuals and handbooks are the ripest area to discover grounds for alleging breach of employment contract. It may be a critical area for CPA firms. The accounting literature on CPA firm employee manuals generally focuses on developing policies that promote both professionalism of the employee and consistency of personnel management procedures.
Scant attention is paid to legal considerations.
Possible pitfalls are suggested by two following cases cited. Consider Toussaint v. Blue Cross and Blue Shield of Michigan. Toussaint was handed a manual of Blue Cross personnel policies which reinforced the oral assurance of job security. The recent case of Woolley v. Hoffman-LaRoche, Inc., may indicate the future trend in litigation. A civil engineering group leader of nine years service was discharged.