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  • Writer's picturePaul Peter Nicolai

Implied Covenant Of Good Faith And Fair Dealing In Employment

An employer sued, saying an employee breached her employment agreement. The employee countered with a claim for breach of the implied covenant of good faith and fair dealing. The court ruled that the counterclaim should go to trial.

WHY THIS IS IMPORTANT… Generally speaking, the implied covenant of good faith and fair dealing, also known as Chapter 93A, does not apply in the employment context. It does apply if an employer deprives an employee of contractual rights. The contract here gave the employee a right to work in a professional environment. Since the employee alleged there was no professional environment, the court ruled there might be a breach of the implied covenant. Employers need to be careful about what they promise in employment agreements.

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