IN RE: Dr. Blum -- Potential Claims
Our new client, Dr. Elana Blum, a licensed physician, was hired by East Coast Medical Group ("ECMG") pursuant to an Employment Term Sheet ("Term Sheet") for a period of five (5) years beginning November 1, 1998 (and ending November 1, 2003). The Term Sheet states four (4) "events" upon which Dr. Blum's employment may be terminated. Last week, ECMG terminated Dr. Blum's employment without cause, as none of the events had transpired. ECMG has not paid her salary since January 1, 1999.
Although Dr. Blum did not enjoy working with ECMG, she struggled not to display her discontent, since she believes she would have trouble finding another position. It is not known whether Dr. Blum's attitude was the reason for her termination.
Finally, the Term Sheet expressly states that a "Full Agreement" was to be entered into within "30 days of the signing" of the Term Sheet. Although this never occurred, it is believed to have been the result of an oversight on the part of both parties and not a deliberate act.
Is the Term Sheet an enforceable employment contract in the absence of a "Full Agreement," such that Dr. Blum may recover either her position or salary for the full period of the contract? If not, what claims are available to Dr. Blum in her resulting status as an employee-at-will?
The bulk of this memorandum is given to discussing Dr. Blum's strongest potential claim, i.e., that the Term Sheet is, in fact, an enforceable employment contract between the parties. In analyzing alleged breach of employment contract claims, courts have looked to whether a "formal contract" was in place between an employee and defendant-company. Murphy v. American Home Products, 58 N.Y.2d 293, 448 N.E.2d 86, 461 N.Y.S.2d 232 (1983). Arguably, the Term Sheet is not in form the "Full Agreement" as originally contemplated in Paragraph 6 by the parties. Nonetheless, it was never expressly revoked and contin...