BREAKING NEWS

Montana’s Wrongful Discharge from Employment Act- AMENDED!

The Wrongful Discharge Act from Employment Act (WDEA) was originally enacted in 1987.  The intent of the Act was to balance an employee’s need for protection from wrongful termination and the employer’s need for protection from substandard employee performance and/or behavior.  Under the Act, an employee is not “at-will” after successfully completing a probationary period.  This means the employee can only be terminated for good cause.

House Bill 254, recently signed into law, amends the original Act.  Here are the highlights:

• The original 6-month probationary period is amended to allow for a 12-month probationary period.
• Extension of the probationary period is allowed prior to the expiration of a probationary period, but the original probationary period together with any periods of extension may not exceed 18 months.
• Any leaves of absence are not counted as probationary time unless the employer states the leave of absence time is included in the probationary period.
  • “Leave of absence” means an employee’s absence from work for a period of more than 5 consecutive working days for any reason other than holidays or vacations.
• The employer has the broadest discretion when making a decision to discharge a managerial or supervisory employee.
• Following any verdict or award in favor of the discharged employee, the district court shall consider any monetary payments, compensation, or benefits the employee received arising from or related to the discharge, including unemployment compensation or benefits and early retirement pay, and shall deduct those payments, compensation, and benefits from the amount awarded for lost wages before entering judgment.
• Employers now have 14 days to notify discharged employees of any internal grievance policy/procedures from the employee handbook.
  • This used to read 7 days to notify.
  • The timeframe for the employee to start the internal grievance procedures begins to run from the date the employer sends or provides a copy of the internal procedures in writing or electronically.  A copy of the procedures must be considered provided to the employee if the employer sends a copy of the procedures to the employee’s last-known postal mailing address, or the employee’s attorney.

What should an employer do now?  Consider amending your probationary policy in your employee handbook to 12 months; reserving the right to extend probation an additional 6 months.  Educate employees to the amended policy, and have employees sign a new acknowledgment or a copy of the individual policy.  Employers are not required to enact a one-year probationary period, but why would we not want to take advantage of a longer “at-will” period to make a good decision on our new hires?

The information in this article is not intended to provide legal advice, nor is this article an all-inclusive overview of the Act.  Future case law will also play a part in how the Act is interpreted.  You are encouraged to research Montana House Bill 254 to learn more, or members may call Associated Employer’s hot line at 406.248.6178 to speak with an HR Business Partner.

Written by: Bryan Peterson