|One more kick in the nuts for the employee.
NEW YORK (MainStreet) — Let the worker beware: in Texas it is now entirely legal to lie to your staff.
A recent decision from the Texas Supreme Court has ruled that at-will employees can't sue their employer for fraud over the loss of their jobs. In his opinion, Chief Justice Nathan Hecht held that "while an employee can sue an employer for fraud in some situations... [a] claim cannot be based on illusory promises of continued at-will employment."
In 2002 E.I. du Pont de Nemours announced plans to turn some of its operations into a separate subsidiary. Most of the affected employees were under a union agreement that gave them the right to transfer within DuPont if they preferred, a decision which would have cost the company an enormous amount of money to retrain the transfers and hire their replacements.
The employees were worried that if DuPont sold the new subsidiary it would hurt both their pay and retirement funds. To convince them to work in the subsidiary instead of transferring within the company, DuPont assured its employees that it had absolutely no plans to sell the spin-off. Based on this promise almost everyone moved to the subsidiary, which a few weeks later DuPont sold to Koch Industries. Koch cut both salaries and retirement packages. DuPont had, as it turns out, been negotiating this deal the entire time.
The Texas Supreme Court sees no problem with any of this.
Writing for the court, Hecht noted that at-will employment in the state of Texas means that a worker can be fired "for good cause, bad cause or no cause at all." While this is true to some degree in every state except Montana, many have carved out exceptions to limit employer abuse. Two of the most common are the requirements of good faith and fair dealing, and the implied contract exception (when your employer makes a promise even if it's not in writing). Texas has specifically rejected both.