I have previously posted about the topic of “at-will” employees and cautioned employers that it is possible to create an expectation of job security in the documents issued to employees, thus negating the “at-will” status.

In the case Ellis v. BlueSky Charter School, A09-1205 (Minn. Ct. App. 2010) (pdf) the school director challenged his termination based on language in his employment agreement. Mr. Ellis was hired as school director for the 2008-2009 school year. An employment agreement was executed between Mr. Ellis and the school board stating, “[t]his is a general at will agreement.” It also set forth the work year as July 1, 2008 – June 30, 2009 and provided, “[p]ositions will automatically renew for one year after one year of service unless specific actions are taken by the board before April 15th of each year.” Mr. Ellis was terminated by the board on May 7, 2009.

In Minnesota, an employment contract for a fixed term is generally interpreted as terminable only for cause. The Minnesota Court of Appeals in an unpublished decision held in this case, “[t]he plain language of the “at-will” phrase overrides the general rule for construing a fixed-term contract, expressly replacing any implication that might have been drawn from the reference to start and end dates. The asserted tension between the at-will declaration and the stated dates of service does not create ambiguity.” Mr. Ellis’s position was determined to be at-will.

If you are hiring new employees, make sure their employment status is clear to them. If an employee is “at-will,” tell them so.

  • I think this is an odd result. Usually in a contract the specific or detailed language will over ride a general statement. However, based on the automatic re-new language, it could have been read to require the district to pay for the next year, even though the district had the right to terminate. In other words, the court could have looked at the fixed term for compensation, even though the employee was fired. I like your comment that the employer should tell the employee it is an at-will agreement. But then, they should leave out the automatic renewal language. That just causes confusion.

    Gavin Craig