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What Constitutes a Written Employment Contract?

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By Lane V. Erickson, Attorney

Written employment contracts come in all shapes, sizes and forms. Some even have the unambiguous words “Employment Contract” typed in bold words at the top of the first page. But not all do.  Under Idaho law there is no magic form that in and of itself is the only form that an employment contract must be in. For this reason, sometimes an employment contract exists and no one even knows that it does. Let’s start with the easiest of all, the document that has the title “Employment Contract.” In Idaho this document is rare and elusive, but it does actually exist. In my experience it is most often found in the realm of professional work.

E-mails, letters and other miscellaneous written documents can also create an employment contract. This occurs in Idaho more often that you might think and usually occurs as the parties are simply discussing the creation of a new employment relationship. Nevertheless, if mutual promises and assent occur, a written employment contract may exist. Usually this type of an employment contract doesn’t provide much more than the start date, the responsibilities and the salary/wage. There typically isn’t any information on the term of the contract or how it can be terminated. When this is the case, the employer’s ability to discipline or terminate an employee is simply left up to the employer, which is the case when no employment contract exists.

Some employees believe a written contract exists when, in fact one does not. This was the case in Huyett v. Idaho State University, et al., 140 Idaho 904 (2004). In Huyett, the employee was hired by Idaho State University as head coach for the women’s basketball team, through a letter agreement containing a one year term. The employee wanted a multi-year employment contract and asked for one. The University did not respond. Shortly following her employment the employee was asked to sign a number of forms to complete her payroll paperwork with the University. One of these forms was listed as an “Employment Contract” and contained language indicating that her employment was subject to the rules and conditions of the Idaho State Board of Education and that she could be reassigned by the University at any time. Negotiations for a multi-year contract took place and the University prepared a draft three-year contract that was never signed and was later rescinded by the University. At the end of one year the employee was terminated. The employee sued claiming breach of both an express and an implied multi-year contract. The district court ruled in favor of the University. The employee appealed and the Idaho Supreme Court affirmed stating that absent mutual approval and assent, there was no binding multi-year contract.

The final situation is when an Employment Handbook exists. When an Employment Handbook exists, it may control an employer’s ability to either discipline or terminate an employee. Often an Employment Handbook contains language in it that creates contractual rights of employment. The best Employment Handbooks contain clauses that state that it is only for informational purposes and does not create any contractual rights.

When any type of a valid and enforceable written employment contract exists, its terms may control an employer’s rights. This is true regardless of whether the contract contains specific terms concerning discipline and termination or simply implies this right to the employer based upon the totality of the language in the contract. For this reason, it is important for both employers and employees to understand the terms and conditions of any existing employment contract and to follow the terms.

If you are an employer or an employee and have questions about whether you have a written employment contract, we can help. Call us toll free at 877-232-6101 or 208-232-6101 for a consultation with Lane Erickson and the Racine Olson team of Employment Law attorneys in Idaho. You can also email Lane Erickson directly at lve@racinelaw.net. We will answer your Idaho Employment Law questions and will help you solve your Idaho Employment Law problems.

This website includes general information about legal issues and developments in the law. Such materials are for informational purposes only and may not reflect the most current legal developments. These informational materials are not intended, and must not be taken, as legal advice on any particular set of facts or circumstances. You need to contact a lawyer for advice on specific legal issues.

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