Abstract
This employment case concerns Mark Piper, a tour guide working for Turnip Plaza Hotel. Through his hard work, Mark can attain good working skills and build a career for himself. Because he mastered skills in the field, he was approached by a rival company representative and offered a higher-rate work position (Foster Swift, 2023). On noticing this, Edward’s manager chose to retain him by providing him with a counteroffer that ensured his salary went up by 50%, making Mark opt to continue working for Turnip Plaza (Lambert et al., 2018). In a month’s time, Mark is fired for reasons not well documented, and the concern is that Mark might choose to take legal action against Colossal Corporation. Upon review of the case, the essay will discuss legal theories and ethical elements and provide recommendations on the action to be taken.
Theories Related to the Case
To discuss the case, the theories to consider will be:
- Verbal versus written contracts of employment
- Principle of respondeat superior
To understand the first theory, it is important to understand the first agreements. An unenforceable agreement is when the parties involved agree to do a valid bargain but are denied by law; in a voidable contract, a single party is allowed by law to terminate the contract; and in a void agreement, none of the parties is permitted to enforce since the deal is considered to be illegal (Foster Swift, 2023). Moreover, an express contract indicates all the essential terms involved in the agreement, while in the implied contract, the party’s conduct and words show an intended agreement. Lastly, promissory estoppel is applied by a plaintiff when there is no contract to enforce the promise of the defendant, while a quasi-contract is applied by the court to compensate the plaintiff. In the case presented, Mark’s decision to remain in the company was based on the promise made by Edward, implying that he would get a payment increase. Edward made precise promises, showing that the verbal agreement could be considered lawful and enforceable in a law court.
This gives Mark the advantage in that he could sue Colossal Corporation for breach of contract, but there is more to this. First, labor contracts vary with states, which means that research will need to be done to determine if there is a case between Mark and the employer, depending on the state’s laws (Brodie, 2022). Lucky for him, Michigan State allows verbal agreements between employer and employee, and he could thus argue that Edward made oral promises of salary increment, but he ended up losing his job. However, since there isn’t any written evidence to support the oral agreement, the court of law will be required to carry out detailed scrutiny to determine the nature of the verbal agreement and what exactly led to it.
The case would be based on promissory estoppels, and this occurs when the parties to a contract change their stand on a promise that was made; the offended party then can ensure that there is the enforcement of the contract even though the contract elements were absent. In this case, Mark can use promissory estoppel, as the company promised him permanent employment and a salary increment (Gan, 2015). The company’s promise led him to decline the other job offer as they had entered into a contract. The contract enforcement would then make the company liable for fulfilling their promise to Mark, as he had already made the choice and anticipated the salary increase. Even without prior notice, his termination is considered illegal as the contract’s end was not kept.
The second theory is the principle of respondeat superior. Respondeat superior, related to the doctrine of strict liability, imposes indirect or vicarious liability on the employer. This means that the employer is held liable even though the employer was not personally at fault for the actions committed by the agent. In this case, the agent is Edward, and the employer is a colossal corporation (Glavaničová & Pascucci, 2022). This means that Colossal Corporation should be held responsible for the actions that were committed by its agent, Edward, even when he was working without the employer’s consent. This means that if Mark could show that there was indeed a verbal contract between him and Edward, then Colossal Corporation would have no option but to pay him for the damages caused.
The courts will examine several things in determining Mark’s case against Colossal Corporation. We must consider whether the employer authorized the employee. In this case, Edward was authorized by Colossal Corporation. We must also consider how much the act propagated the employer’s interest. Edward’s interests did advance the acts of the company.
Further, we examine the extent to which the employees’ private interests were involved. In this case, they were highly involved (Gan, 2015). The court ruling might hold that the employer would not be liable if the servant were on a “frolic of his own” and not in his employer’s business. In this regard, Colossal Corporations Tires will not be responsible because Edward left his duties, causing the injury. This is because sometimes an individual who is not the authorized agent and acting beyond his authority limits enters into a contract on behalf of a principal. However, this contract will only become legally created if the principal adopts or approves the contract by ratification. Ratification by principal usually happens as a matter of intention, and intention can be expressed, used, or implied by conduct.
Contracts at-will is also referred to as at-will employment. The name relates to those types of relationships where the employer can terminate an employee for any reason without having to establish a “just cause” for the termination and without warning. In this case, courts will deny the worker any claims for loss resulting from dismissal. Similarly, an employee can leave their job without providing notice or warning to his or her employer. Although it seems like a fair ordeal for both parties, many experts have expressed their review of the relationship as being unjust. An inequality of bargaining power characterizes it.
On the other hand, fixed-term contracts are the opposite of at-will employment. In fixed-term contracts, the relationship between the employer and employee lasts for a specified period, after which the relationship ceases to exist. In some cases, the two parties can negotiate the possibility of renewing the contract, and upon agreement, they replace the relationship for another specified period as stated in the contract (Glavaničová & Pascucci, 2022). Fixed-term Contracts face government regulations through labor laws to ensure that the employer will fulfill labor rights regardless of the contract’s form. The employer usually can terminate the employment on reasonable grounds by issuing a notice and abiding by labor laws and terms stated in the contract.
Damages through Litigation
According to business law in the US, the damages are usually monetary. This means that if Mark wins the case, Colossal Corporation must make some payments to compensate for the damages. Here, no criminal cases are involved, as the law holds that law cases related to wrongful termination of contracts be paid in monetary form. The damages will be computed in terms of the losses made, the attorney’s fees, and the emotional distress Mark has to undergo because of the wrongful termination. The idea is to discourage employers from engaging in contract breaches and encourage employees to come forward when certain events happen in the workplace (Brodie, 2022). Punitive damages can be applied if the employer engages in violence. As argued by Brodie (2022), the court must investigate whether Mark’s actions were just or not, as he could have agreed with Edward and, at the same time, considering to do some work for the rival company.
If Mark chooses to work for the rival company, then there will not be any collection of wages through litigation. This is because the rival company is offering a better package, and this means that working for the company will result in compensation for all expenses that he incurred after termination. It is also important to note that the general rule holds that punitive damages will not be awarded in damages resulting from wrongful termination cases. This, therefore, means that Even if Mark opted to take Colossal Corporation to court and won the case, there wouldn’t be any monetary gain for him, according to what the law currently holds.
Ethical Principles
The ethical principles in Mark Piper’s case are intricate and multifaceted, intertwining with the organization’s commitment to fidelity, trust, and the psychological contract with its employees. When an organization, through its representative like Edward, makes a contractual promise to an employee, it sets the stage for ethical considerations centered around fidelity. Lambert et al. (2018) stress the importance of fidelity in work as it relates to preserving the psychological contract – a non-written understanding between employer and employee regarding mutual expectations. Colossal Corporation violates the trust established through psychological contracts by failing to uphold its commitment towards Mark and puts employee relations at risk in general (Lambert et al., 2018). This breach could affect the workforce, touching elements such as commitment, engagement, and overall productivity. Regarding ethics, the organization should consider what may happen when promises are not fulfilled and how this affects corporate culture and employee morale.
In addition, the case’s moral foundation also encompasses corporate integrity and accountability. Upholding promises made to employees is not merely a contractual obligation but an ethical duty rooted in the broader social contract between businesses and society. When a corporation fails to honor its commitments, it risks eroding the foundational trust that employees place in the organization. The repercussions extend beyond the individual case, influencing the overall perception of the company’s integrity and its commitment to ethical business practices (Earles, 2021). In essence, the ethical principles demanded that Colossal Corporation not only rectify the situation with Mark through fair and just means but also reflect on its internal processes to ensure the preservation of trust and integrity in its relationships with all employees. By addressing these ethical dimensions, the organization can not only mitigate the immediate fallout from Mark’s case but also foster a workplace culture built on transparency, commitment, and the ethical responsibility of honoring promises made to its employees.
Recommendations for Action
Mediation and Reinstatement Efforts
In addressing the employment dispute with Mark Piper, Colossal Corporation should consider mediation to facilitate a constructive dialogue. Mediation allows both parties to express their concerns, explore potential solutions, and find common ground. As part of this process, the company could reassess Mark’s role within the organization, seeking a compromise that aligns with his skills and experience (Tomassetti, 2020). While honoring the initial promise of a 50% salary increase may not be feasible, offering a reasonable promotion or salary adjustment could be a proactive measure to mitigate potential legal actions. Colossal Corporation can salvage its relationship with Mark and maintain a positive workplace environment by fostering open communication and demonstrating a commitment to resolving the issue amicably.
Policy Review and Approval Protocols
To avoid such incidents in the future, Colossal Corporation should reconsider and revise its employment policies pertaining to salary changes and promotions. A more formalized approval procedure for major employment changes would align managerial decisions with company standards and legal constraints (Glavaničová & Pascucci, 2021). This may require managers to get higher-level approval before making commitments that affect an employee’s terms and conditions. By setting up standard guidelines and approval procedures, the company can ensure consistency and fairness in its decision-making processes, thus reducing the possibility of one-sided action that may lead to litigation.
Training on Employment Law and Ethical Conduct
Colossal Corporation should implement elaborate training programs for its managers to improve managerial skills and consciousness. These programs must be directed on employment laws, ethical behavior, and effective communication. Teaching managers about the legal ramifications of verbal agreements, the importance of sticking to promises made to employees, and the consequences if the contract is breached can facilitate an educated leadership team (Earles 2016). Moreover, by highlighting the necessity of preserving moral values (such as fidelity and trust) in an organization, it is possible to create a proper working environment that would be less susceptible to future breaches.
Documentation and Record-Keeping Procedures
Improving the organization’s documentation and record-keeping systems is critical to offering a transparent and accountable framework for employment agreements. Colossal Corporation should take steps to ensure that verbal agreements, especially those touching on employment terms, are put in writing. This may involve follow-up emails recounting the discussions or using standardized forms to record any commitments made (Tomassetti, 2020). Such documentation acts as a point of reference in the event of disputes and also adds an element to verbal agreements. With the help of sound record-keeping practices, it is possible to minimize legal risks and prove that a company strives for transparency; furthermore, such procedures can effectively solve disputes within a reasonable time.
Continuous Monitoring and Feedback Mechanisms
Employee satisfaction is assessed by creating continuous monitoring mechanisms and feedback channels to help address problems before they get out of control. Colossal Corporation should introduce regular performance reviews and feedback sessions to evaluate employee concerns, expectations of the job, and overall satisfaction with the position (Earles 2021). Such a proactive approach enables the company to detect inconsistencies between managerial intentions and actions, thus enabling timely intervention to correct misconceptions or unfulfilled pledges. By establishing an open communication and accountability culture in the organization, it becomes easier to build trust with employees so that they are less likely to engage in legal battles, thus creating a conducive work environment.
References
Brodie, D. (2022). Constructive dismissal: The contractual maze. King’s Law Journal, 33(2), 151–168. https://doi.org/10.1080/09615768.2022.2093620
Earles, N. R. (2021, October 27). Menu. Louisiana Law Review. https://lawreview.law.lsu.edu/2021/10/27/stipulating-vicarious-liability-to-avoid-direct-negligence-claims-why-this-relic-of-the-past-should-be-abandoned-in-louisiana/
Foster Swift. (2023, February 22). Foster Swift. Michigan Labor and Employment Law. https://www.michlaborlaw.com/topic,news
Gan, O. (2015). The justice element of promissory estoppel. St. John’s Law Review, 89(1), 55-100.
Glavaničová, D., & Pascucci, M. (2022). Making sense of vicarious responsibility: Moral Philosophy meets Legal theory. Erkenntnis, 89(1), 107–128. https://doi.org/10.1007/s10670-022-00525-x
Lambert, E. G., Liu, J., & Jiang, S. (2018). An exploratory study of organizational justice and work attitudes among Chinese prison staff. The Prison Journal, 98(3), 314–333. https://doi.org/10.1177/0032885518764919
Tomassetti, J. (2020, November 19). Power in the employment relationship: Why contract law should not govern at-will employment. Economic Policy Institute. https://www.epi.org/unequalpower/publications/the-legal-understanding-and-treatment-of-an-employment-relationship-versus-a-contract/
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