## Facts

- Craig McDonald worked as a preparation plant technician at Mobil’s Caballo Rojo coal mine from August 1987 to June 1988.
- His employment application stated that employment was terminable at the will of either party, subject to applicable law.
- After hiring, Mobil provided an employee handbook describing company policies and certain disciplinary procedures, and stating it was not a comprehensive manual or an employment contract.
- McDonald became the subject of workplace rumors of sexual harassment; after he inquired, he was instructed to focus on his job.
- McDonald was later called to a meeting with three supervisors and, according to him, was given the choice to resign or be fired; he resigned.
- McDonald sued Mobil and three supervisors for wrongful discharge, alleging that the handbook created contractual limits on termination and alleging breach of the implied covenant of good faith and fair dealing.
- The district court granted summary judgment to Mobil and the individual defendants.

## Issues

1. Whether Mobil’s employee handbook and Mobil’s course of dealing could modify McDonald’s at-will employment so that termination required cause and/or compliance with stated procedures.
2. Whether the application and handbook disclaimers were effective to preserve at-will employment, including whether the handbook disclaimer was sufficiently conspicuous and clear.
3. Whether summary judgment was proper in light of disputed facts concerning the handbook’s effect and Mobil’s practices.
4. Whether the implied covenant of good faith and fair dealing supplied an independent wrongful-discharge claim on these facts.

## Decision

- The Wyoming Supreme Court reversed summary judgment and remanded for further proceedings.
- The court held there was a genuine issue of material fact whether the handbook and Mobil’s course of dealing modified the at-will relationship.
- The court held that the conspicuousness of a disclaimer is a question of law for the court.
- The court concluded Mobil’s handbook disclaimer was not sufficiently conspicuous or clear to defeat, as a matter of law, the employee’s claim of handbook-based modification.
- The court did not recognize an independent implied-covenant wrongful-discharge claim on the record presented, focusing the remand on whether a contractual modification existed.

## Legal Principles

- At-will employment may be modified by an employer’s handbook provisions and the parties’ course of dealing when the materials and practices can reasonably be understood as limiting termination discretion.
- Disclaimers intended to prevent handbook provisions from having contractual effect must be conspicuous and must clearly communicate their legal effect to a reasonable employee.
- Whether a disclaimer is conspicuous is a question of law; if the disclaimer is not conspicuous and the handbook contains language suggesting fair treatment or progressive discipline, factual issues may preclude summary judgment.
- The implied covenant of good faith and fair dealing does not, without an underlying modified contractual employment relationship on the facts shown, create an independent wrongful-discharge cause of action.

## Conclusion

The court reversed summary judgment because the handbook’s ambiguous, nonconspicuous disclaimer and Mobil’s asserted practices created triable questions about whether McDonald’s at-will employment had been modified, while rejecting an independent implied-covenant theory on the record presented.


McDonald v. Mobil Coal Producing, Inc., 820 P.2d 986 (Wyo. 1991)