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The provisions of an employee handbook can form the basis of a cause of action in one worker’s breach-of-contract suit, the Pennsylvania Superior Court has ruled. Most often, the state’s courts have shied away from recognizing handbooks as contracts. The three-judge panel’s decision in Bauer v. Pottsville Area Emergency Medical Services Inc. could be seen as a rare victory for plaintiffs, but the unique factual situation may limit its impact. Plaintiff Dennis Bauer’s attorney, Stanley J. Brassington of Schuylkill County, Pa., said although he did not see the case as a pure handbook issue, it will provide ammunition for such cases in the future. “It’s helpful. It picks away at a problem we’ve been facing for a lot of years,” Brassington said, referring to Pennsylvania’s at-will employment doctrine. Counsel for the defense, Paul J. Dellasega of Thomas, Thomas & Hafer in Harrisburg, could not be reached for comment. FULL-TIME BENEFITS Bauer worked as an emergency medical technician with Pottsville Area Emergency Medical Services Inc. Some time after Bauer began his employment, Pottsville issued an employee handbook. The handbook said employees who worked 36 hours per week for 90 consecutive days would be treated as full-time employees. Bauer had worked those hours for that many days and believed he had the right to full-time wages, health insurance and other benefits, Senior Judge Patrick R. Tamilia said in the opinion. He complained to Pottsville and filed a breach of contract action and an action under the Fair Labor Standards Act. The Schuylkill County Common Pleas Court sustained Pottsville’s preliminary objections and gave Bauer leave to file an amended complaint. Pottsville responded in preliminary objections that a provision in the handbook stipulates its intention to create an at-will employment relationship, that Bauer did not file a formal complaint under the FLSA and that he did not assert a violation of rights protected by the FLSA. The trial court dismissed Bauer’s complaint. On appeal to the three-judge Superior Court panel, which also included Judges James Cavanaugh and Joseph Del Sole, Bauer claimed the handbook’s terms created a duty on Pottsville to pay him full-time benefits once he worked 36 hours per week for 90 days. Pottsville countered that the handbook specifically states that it is an “employer at will,” with the right to terminate employment at any time. Therefore, Pottsville argued, the handbook did not create a binding contract. Tamilia relied on the guideline created in the Superior Court’s 1997 employee-handbook decision Luteran v. Loral Fairchild Corp. The Luteran court said a handbook is enforceable against an employer if a reasonable person could surmise that the employer meant to be legally bound by its provisions, rather than follow the at-will employment rule. An excerpt from the handbook included in the opinion showed that it did state that Pottsville is an at-will employer. The trial court relied on that provision when it said there was no contract on which Bauer could base his cause of action. But Tamilia said the trial court got it wrong. Looking at the full-time employment provision Bauer was arguing, Tamilia said a reasonable person could understand that a certain amount of time worked would lead to full-time benefits. Tamilia made it a point, however, to emphasize that public policy made Bauer’s case unique. He explained that emergency medical services perform critical functions 24 hours a day, but some services are not fully funded by their municipalities. “To the extent the service provided is not fully funded by government or is created as a specific arm of a mandated public service, subject to contract or even union-negotiated agreements, there exists a wide flexibility in the operative arrangement of the employment relationship,” Tamilia said. “The nebulous and temporary character of the employment is illustrated by the provision in question here.” Although the handbook did contain elements of a contract on a quantum meruit basis, Tamilia said, it did not comprise absolute, binding terms. The handbook says an employee who works the required number of hours will be “treated as a full-time employee.” Tamilia said that language was instructive. “The term ‘treated as’ implies that during the period the stated conditions were met, the entitlements applicable to a full-time employee would inure to the employee’s benefit,” he wrote. Therefore, Pottsville was not bound to provide full-time benefits when the minimum-hours requirement was not met. The court also affirmed the trial court’s conclusion that the facts presented in Bauer’s complaint did not support a cause of action for retaliatory discharge under the FLSA. In a concurring and dissenting opinion, Cavanaugh clung firmly to the at-will employment doctrine, accentuating the fact the wrongful discharge suits based on employee handbooks have generally been limited to individuals who have been terminated. “The law is clear that no cause of action, whether styled as one at law sounding in contract or as one in equity upon estoppel principles, may be maintained by an employee for enforcement of the provisions of an employee handbook where that handbook was not a bargained for portion of the offer of employment,” Cavanaugh said. “Here, the handbook was not an element of the offer of employment since its effective date was May 1, 1998 and [Bauer] was hired in April 1997. The amended complaint contains no averments which would constitute additional consideration sufficient to bind the employer to the provisions of the handbook.”

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