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Breach of Implied Contract Not to Termination Without Good Cause 

breach of implied contract
An at-will employment presumption that applies to most employees in the private sector in California, can be refuted by proving the existence of a so-called implied contract or implied covenant not to terminate an employee without good cause. In order to make this type of wrongful termination claim, two elements need to be proven. First, the claimant must prove the existence of implied contract. Secondly, he must show that the reason for his termination did not amount to "good cause" within the meaning of the law. 


1. Establishing Existence of Implied Contract Not To Terminate Without Good Cause
To determine whether an implied contract exists, the court evaluates the parties’ acts and conduct “interpreted in the light of the subject matter and the surrounding circumstances” to determine the existence of the agreement. Courts consider a variety of factors in the analysis (1) the employer’s personnel policies and practices; (2) the employee’s length of service; (3) actions or communications by the employer reflecting assurances of continued employment; (4) practices in the industry in which the employee is engaged; and (5) whether the employee gave independent consideration for the employer’s promise (i.e. covenant not to compete or promise not to disclose confidential information. No single factor, or particular combination of the factors necessarily establishes that an employee had a right to be discharged only for good cause. Rather, each case turns on its own facts and the court must seek to enforce the actual understanding of the parties. This means that little details such as a single e-mail or a single conversation making a promise in so many words to provide employment for a long time or as long as business goes well, etc... can make a big difference to proving a case. 

2. Showing Absence of Good Cause
Good cause, when not defined by the employer, is "fair and honest reasons, regulated by good faith on the part of the employer, that are not trivial, arbitrary or capricious, unrelated to business needs or goals, or pretextual; in short, a reasoned conclusion supported by substantial evidence gather through an adequate investigation that includes notice to the claimed misconduct and a chance for the employee to respond."


Although inherently vague, this definition allows claimant to attack the termination as being without good cause in several ways. For example, an argument can be made that no investigation  was conduct, or the investigation was very poorly conducted (only some witnesses were interviewed, the investigator was not qualified to conduct the investigation, the investigator was biased, etc.). An employee can also attack "good cause" termination by showing that he didn't have an opportunity to present his side of the story or appeal the employer's decision to terminate. Finally, the employee can also argue that the evidence upon which he was terminated was not "substantial", i.e. based on rumors or one person's words against his word without any corroborating evidence of misconduct.  And of course, evidence of discrimination or retaliation in the termination will usually defeat the employer's argument that there was good cause for termination. 

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Law Office of Arkady Itkin - San Francisco & Sacramento Injury and Employment Lawyer
We represent employees and employers in employment and wrongful termination cases, as well as victims of serious injuries in San Francisco, Oakland, Sacramento, San Jose, Palo Alto, San Mateo and throughout Northern California. We all represent businesses and start-ups in a wide range of business and employment issues and disputes. 


57 Post Street, Suite 812, San Francisco, CA 94104; Tel. (415) 295-4730; Fax. (415) 508-3474; [email protected]
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  • Home
  • Employment Law
    • Wrongful Termination >
      • At-Will Employment
      • Termination After Unfair Warnings and Write-Ups
      • Union Grievance, Workers Comp and Wrongful Termination
      • Labor Code 970 Claims
      • Promissory Estoppel and Employment Contracts
      • Implied Contract Claims
    • Discrimination >
      • Proving Discrimination
      • Age Discrimination
      • Disability Discrimination >
        • Protected Disabilities
        • Medical Leave / Disability Accommodations
        • Job Reassignment As A Disability Accommodation
        • SSI Disability Benefits and Your Court Case
        • Sample Request for Reasonable Accommodation
      • Pregnancy Discrimination
      • Race Discrimination
      • Sample Discrimination Complaint
      • DFEH and EEOC Investigations
    • Retaliation >
      • How to Prove Retaliation
      • Dealing with Retaliation While Still Employed
      • Retaliation for Complaining
      • Whistleblower Retaliation
    • Harassment
    • Defamation at Workplace
    • Prof. License Defense
    • Leaves of Absence >
      • Medical Leave as Reasonable Accommodation
      • FMLA Entitlement and Reinstatement to Work
      • CFRA Leave
      • Employers' FMLA Notice Obligations
      • Paternity Leave (FMLA)
      • Sample FMLA Leave Request
    • Wages / Overtime Claims >
      • Wage Claims
      • Employee or Contractor
      • Exempt / Non-Exempt >
        • Admistrative Exemption
        • IT Support Specialists Compensation
        • Computer Professional Exemption from Overtime
        • Recruiters / Account Executives Exemption
        • Complaining About Being Misclassified
      • Vacation Pay / PTO
      • On-Call Time Compensation
      • Deductions fr. Commissions
    • Unempl. Benefits Appeals >
      • Tips for EDD Phone Interview
      • Unemployment Benefits Appeal Hearing Representation
      • CUIAB Hearing Tips
    • Employment Law Blog
    • For Employers
  • Personal Injury
    • Five Tips For Injury Cases
    • Slip-and-Fall Injuries
    • Assault and Battery
    • Recorded Statements
    • Repairing Your Vehicle
    • Unpaid Medical Bills
    • Injury Law Blog
    • Medical Malpractice
    • Police Excessive Force
  • Practice Areas
  • About
  • Results
  • Submit Case
  • Contact
  • Resources
    • Consultations
    • Workplace Rights Checklist
    • Deposition Tips
    • Mediation Tips
    • Effective Mediator
    • Suing Current Employer
    • Severance Agreements
    • Workplace Investigation
    • Arbitration
    • Statutes of Limitations
    • Healthy Litigation Mindset
    • Trial Tips
    • Working Remotely
    • How To Find The Right Lawyer For Your Case