Opinion
CIVIL ACTION NO. 06-0635.
July 23, 2007
RULING REGARDING ISSUES OF LAW
I. Whether the City's Employee Handbook constitutes a contract
The parties have asked to Court to determine whether the City of Monroe's Employee Handbook creates a contractual relationship between the City and its employees under federal and state law. The parties have submitted supplemental memoranda of law, and the Court is now prepared to rule.
For the following reasons, the Court finds that the Handbook is not a binding contract under federal or state law.
Under federal law, a written policy outside the collective bargaining agreement, or "CBA," which is enforced by the employer and accepted by the union, is incorporated into the CBA. Plaintiff has failed to offer any facts which show that the parties intended to incorporate the Handbook into the CBA. Further, Plaintiff ignores the explicit disclaimer in the Handbook which states that "[t]his handbook is not a contract of employment." Therefore, the Court finds that the Handbook is not part of the total labor agreement between Defendant and the union which represents Defendant's employees.
The Court also finds that the Handbook does not constitute a binding contract under state law. In Louisiana, four elements are required to form a valid contract: (1) the capacity to contract; (2) mutual consent; (3) a certain object; and (4) lawful cause. Because the Handbook contains a disclaimer, the Handbook lacks mutual consent. Further, Louisiana courts have consistently found that similar employment manuals are not binding contracts and instead constitute a unilateral expression of company policies and procedures.