That's It--I Quit!

Illegal Termination

Salvatore notes the charge of constructive discharge doesn't stand alone because it's not illegal in itself to terminate someone. Unless there's a contract to the contrary, employment is "at will" in most states, meaning employees may be discharged at any time for any reason--good or bad--except on the basis of race, religion, gender, national origin or, in some states, sexual orientation. You also can't terminate someone if doing so violates public policy. For instance, it's illegal to fire a whistle-blower for alerting the authorities to your illegal dumping or unsafe products.

In the restaurant case, the former employee argued she was a victim of both constructive discharge and sex discrimination. The case bounced back and forth between the U.S. District Court and the U.S. Court of Appeals, but eventually, the former employee won.

Courts have ruled that constructive discharge takes more than just a demotion, reduction in pay or failure to promote a employee. Employers have a right to do these things. Constructive discharge requires a whole pattern of behavior aimed at making conditions at work intolerable. For instance, says Philadelphia attorney Michael Ossip of Morgan, Lewis & Bockius LLP, a court might take notice if the employer takes away the employee's office and secretary, cuts his salary in half, and assigns him a desk in the boiler room.

Consider another Pennsylvania case. A female sales representative was succeeding in a territory with several major accounts. When she became pregnant, her supervisor told her that he doubted her ability to combine motherhood with a sales career. When she returned to work after a miscarriage, she learned that she'd been transferred to a less desirable territory. Company executives had promised a lucrative territory in Pennsylvania to a man they wanted to transfer, and the only other comparable territory available was already served by a man. Not only was the decision a slap in the face to the woman, but it resulted in such a steep drop in earning potential that she resigned--and sued over constructive discharge and sex discrimination. The court concluded that the company had sacrificed the female sales rep rather than the male because of her gender and pregnancy. She was awarded more than $100,000 in back pay.

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This article was originally published in the November 1999 print edition of Entrepreneur with the headline: That's It--I Quit!.

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