Louisiana is an employment at-will state. This rule is found in Article 2747 of the Louisiana Civil Code which says, “a man is at liberty to dismiss a hired servant attached to his person or family, without assigning any reason for so doing. The servant is also free to depart without assigning any cause.”
Although there are statutory exceptions to the general rule of employment-at-will, courts generally consider the rule important because it furthers broad societal policies, such as the maintenance of a free and efficient flow of human resources.
Recently, the employment-at-will rule was strengthened by Louisiana’s First Circuit Court of Appeal in May v. Harris Management Corporation. In May, the court held that recovery is not allowed under the doctrine of detrimental reliance when an employer withdraws an offer of at-will employment prior to the designated time for the employee to begin work. The case has important implications for all employers. Essentially, the May court says an employer can hire someone and then fire them before they even start work if there is an at-will employment relationship.
The facts in May illustrate the rule. In May, the plaintiff was orally offered a position as a nursing home administrator. The plaintiff negotiated her salary and then accepted the job. There was no written employment contract, and the oral offer of employment was for an indefinite term. The plaintiff asked for a one-month delay before starting her new job so that she could give her old employer a two-week notice of her resignation and enjoy two weeks of accrued vacation time. During the one-month delay period, the plaintiff’s new employer began to feel uneasy about the plaintiff. The new employer withdrew the plaintiff’s offer of employment five days before she was supposed to begin work.
The plaintiff sued the new employer under the doctrine of detrimental reliance. Detrimental reliance is an equitable theory of recovery, and its purpose is to afford a party relief whenever no contract is found. To prevail on a claim for detrimental reliance, a plaintiff must prove three elements: (1) a representation by conduct or word; (2) justifiable reliance; and (3) a change in position to one’s detriment because of the reliance. After reviewing the facts and applicable law, the court determined the plaintiff could not recover from the new employer under the doctrine of detrimental reliance. According to the court, it was “patently unreasonable” to rely on an offer of at-will employment – even during the period between when she was hired and when she was to begin work.
Thus, the May court reaffirmed and strengthened the employment-at-will doctrine in Louisiana. The court acknowledged the “apparent harshness” of its ruling, but said, “to hold otherwise would undermine the at-will employment doctrine in this state.” This decision is clearly favorable for the employer.