EMPLOYMENT AGREEMENTS
EMPLOYMENT AT WILL Under the doctrine of employment at will, an employment relationship may generally be terminated at any time by either party. In the absence of a collective bargaining agreement or other contract that alters this rule, an employer in Minnesota may discharge an employee at any time for any lawful reason, or for no stated reason, with or without notice. Likewise, an employee may resign at any time, for any reason, with or without notice. Minnesota follows this general rule. An employment-at-will relationship can be contrasted with a contractual relationship, in which the rights and duties of the parties are governed by specific contract terms (for example, a fixed term of employment or “for cause” termination provisions). Courts have recognized several situations in which the at-will relationship is modified or limited, or where public policy concerns justify departure from the at-will rule. These situations are discussed further below. Employment contracts Employment contracts may be written or oral. Employers may offer contracts to candidates who would not accept employment without greater security, or where the employer seeks specific protections, such as the protection of confidential information or intellectual property. Employment contracts typically address: • Term or duration of employment • Compensation and benefits
• Job duties and reporting relationships • Grounds and procedures for termination
Contracts may also include provisions on confidentiality, assignment of intellectual property rights (such as patents and copyrights), and, to a limited extent, permissible restrictive covenants consistent with Minnesota law. Minnesota courts have used contract-based theories to create exceptions to employment at will, often for public policy reasons. Examples include: • Finding a binding promise where an employee provides something of value in addition to performing the job (for example, relocating, foregoing another opportunity, or providing special consideration) in exchange for a promise of continued employment. • Enforcing promises where an employee reasonably relies on an offer of employment and, in reliance, gives up another job or opportunity. • Treating statements in a personnel handbook as contractual where the terms are sufficiently definite, are clearly communicated to the employee, and the employee accepts them and provides value by continuing to work, subject to any clear disclaimers or reserved right to change policies.
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