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Once again, a California appeal court has found that at-will employment is really not what it seems and in doing so has opened the door to a whole host of claims. Until Toscano v. Greene Music, 124 Cal.App.4th 685, employers have generally been free to withdraw offers of at-will employment even where the disappointed job seeker has already quit his or her prior job. This is no longer true. In December, the 4th District Court of Appeal in Toscano held that a job seeker who quit an at-will job to go to work for another at-will employer can nevertheless recover lost future wages when the second employer withdraws its job offer. Those lost future wages can be assessed against the employer withdrawing its job offer “as long as they are not speculative or remote and are supported by substantial evidence.” At-will employment is really a very simple concept — until case law twists it into an unrecognizable pretzel. At-will employees can be fired for any reason or even for no reason without advance notice. And an at-will employee can quit at any time for any reason or no reason, without advance notice. There are, of course, some well-recognized exceptions. Most obvious, an employer cannot unlawfully discriminate against an at-will employee, and a discharge cannot violate a well-recognized public policy. Beyond that, at will really means at will — or at least it should. There are, of course, some well-recognized exceptions. Most obvious, an employer cannot unlawfully discriminate against an at-will employee, and a discharge cannot violate a well-recognized public policy. Beyond that, at will really means at will — or at least it should. Joseph Toscano was working as the general manager of a Fields Pianos store in Santa Ana, Calif. Toscano (who had changed jobs several times in the past) contacted Michael Greene, the president of Greene Music in San Diego, because he had heard Greene was thinking of buying a Fields store. Greene offered Toscano a sales manager job. Toscano then resigned his Fields job. Thereafter, however, Green withdrew the job offer. Despite the fact that both Toscano’s Fields job and the sales manager job he was offered by Greene were at will, the jury found that Toscano would have continued working at Fields until his retirement 16 years later if Greene had not offered what ultimately proved to be a nonexistent job at Greene Music. The jury awarded Toscano $536,833 in damages, $119,061 in lost wages through the trial and $417,772 through his retirement in 2017. The unanimous appeal court then found that Toscano could not recover lost wages for losing his offered at-will Greene Music job, but he could recover “reliance damages based on wages lost” from his Fields job. The 4th District found that the doctrine of “promissory estoppel” would permit Toscano to claim his “lost future wages from [his] former at-will employer.” But wait. How can there be any ascertainable future lost wages for his former job? Toscano’s former job was at will and could have been terminated at any time for virtually any reason by either Toscano or his former employer. And, thus the 4th District took away Toscano’s damages recovery. The court found that Toscano could not show any “definite expectation of continued employment with Fields for any particular period of time.” However, the case is going back for a trial on the issue of damages. The appeal court invited the parties to find out if Toscano’s former boss might have a different understanding of the terms of Toscano’s employment or if Fields would have continued to employ Toscano until the end of his career. But how can this be? It is undisputed that Toscano’s employment with Fields was at will. Nevertheless, based on such testimony, Greene may have to pay Toscano promissory estoppel damages. At least in California while the Toscano decision stands and in any other state that would allow disappointed job seekers to use promissory estoppel in this new fashion, potential employers must now be particularly careful. If you make an offer of employment, you may be held liable for damages if you rescind it. And, what if you hire the at-will employee, but then terminate him, days, months or years later? Can you still be sued for promissory estoppel? It is hard to see how the Toscano court would distinguish such facts, but a holding of that sort would eviscerate the doctrine of at-will employment. And, what of an at-will employee who rescinds a job acceptance? Can he or she be sued for promissory estoppel as well? Toscano has now opened a Pandora’s box. Jeffrey Tanenbaum is a San Francisco- based partner and the chair of the labor and employment practice group at Nixon Peabody. He can be reached at [email protected] John Canoni is a New York-based partner in the labor and employment practice group at Nixon Peabody. He can be reached at [email protected]

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