BizLawBuz …. The Power of Know

Employers with a clear and consistent pattern of certain benefits or perks of employment can find themselves stuck with a contractual obligation to maintain those perks. In a recent case from the Michigan Court of Appeals, the Court confirmed an arbitrator’s ruling that a police department had breached a contractual obligation to provide a new officer a “take-home” vehicle since the department had a well-established practice of providing such a vehicle to all other officers.

The Court found that since a certain practice had become a part of the employer’s structure, the employer could not unilaterally change the practice. This particular case arose out of a Collective Bargaining Agreement between the union and the police department, which probably strengthened the police officer’s claim. Still, it serves as a good reminder that employers should not allow informal or unintended perks or benefits to become the norm unless the employer is intending to adopt that norm as its actual practice. It is also a reminder that a course of conduct or pattern that is inconsistent with the written polices of the workplace will often be found to trump those written polices when challenged.

Dirk Beamer
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