1. Did the policies and procedures set forth in the employee handbook provide legally enforceable rights for the covered employees working under the handbook rules?

2. What are the primary sources of public policy under the state’s public policy exception to the employmentat- will doctrine? Is a retaliation firing for a general harassment grievance against supervisors a protected public policy under state law?

John Semple was terminated from his employment with FedEx for falsification of company documents. He appealed his termination through internal FedEx procedures without success and thereafter sued the employer in federal court, contending that his termination was in violation of the “public policy exception” to the employment-at-will doctrine in that his termination resulted from his filing internal grievances regarding harassment by his superiors and that he was protected by the employee handbook exception to the at-will doctrine. The employer disagreed.

JUDICIAL OPINION

BOGUE, Senior District Judge … Pl intiff w s hired by Feder l Express Corpor tion (FedEx) in 1990.  t th t time, he signed  n employment contr ct th t included the following st tement:

I do hereby agree…(11) That during the time of my employment, which term I understand is indefinite, I will comply with the guidelines set forth in the Company’s policies, rules, regulations and procedures…

I ALSO AGREE THAT MY EMPLOYMENT AND COMPENSATION CAN BE TERMINATED WITH OR WITHOUT CAUSE AND WITHOUT NOTICE OR LIABILITY WHATSOEVER, AT ANY TIME, AT THE OPTION OF EITHER THE COMPANY OR MYSELF.

Plaintiff signed this contract below the statement:

“I HAVE READ AND UNDERSTAND THIS AGREEMENT.”… Regarding the handbook he received in 1990, Plaintiff signed a record of receipt which stated: “I understand [the handbook] is not a contract and the information provided may need to be changed by the company from time to time.”…

The handbook…includes Section 4-90 “Termination,” which is almost entirely made up of a subsections entitled “Guidelines” and “Employment Termination Chart.” Within the Guidelines portion, a subsection labeled “Employment at Will” states the following:

The employment relationship between the Company and any employee may be terminated at the will of either party as stated in the employment agreement signed upon application for employment. As described in that agreement, the policies and procedures set forth in this manual provide guidelines for management and employees during employment, but do not create contractual rights regarding termination or otherwise…

PUBLIC POLICY EXCEPTION

… The Court is not persuaded that a termination in retaliation for an internal complaint of harassment violates a “clear mandate of a substantial public policy,” as required for the public policy exception to apply. The primary sources of public policy are constitutions, statues, and judicial decisions. The Court does not believe that the public policy Plaintiff is claiming—anti-retaliation policy borrowed from employment discrimination statutes—is indeed a “clear mandate” but instead can only arise from a distorted interpretation of existing state law. Simply, South Dakota has not outlawed retaliatory firings for filing an internal grievance of general harassment, and this Court refuses to create such a public policy here.… ………………………..