Weaknesses in Employee Handbook Disclaimers

After XYZ Corporation terminated Abigail’s employment, Abigail brought suit claiming that XYZ breached the terms of its employee handbook by failing to identify any violations of the provisions set forth therein and without going through its ordinary progressive disciplinary procedures. She argues that the handbook constituted an implied-in-fact employment contract.
Upon receiving the handbook at the outset of her employment, Abigail signed an acknowledgment form, which states as follows:
I acknowledge that I have received a copy of the XYZ’s Personnel Policy and Procedures Manual. I understand that I am responsible for reading, understanding, and abiding by the contents of these policies and procedures. I further understand that all the policies contained herein are subject to change as the need arises. I further understand that nothing in these policies and procedures creates a contract of employment for any term, that I am an employee at-will and nothing herein limits XYZ’s rights for dismissal.
On page 1 of the handbook, entitled INTRODUCTION, there is the following language:
Important Notice
MANY OF THE POLICIES CONTAINED IN THIS HANDBOOK ARE BASED ON LEGAL PROVISIONS, INTERPRETATIONS OF LAW, AND EMPLOYEE RELATIONS PRINCIPLES, ALL OF WHICH ARE SUBJECT TO CHANGE. FOR THIS REASON, THIS HANDBOOK IS CONSIDERED TO BE A GUIDELINE AND IS SUBJECT TO CHANGE WITH LITTLE NOTICE. THE HANDBOOK DOES NOT CONSTITUTE A CONTRACT OF EMPLOYMENT FOR ANY TERM. NOTHING IN THIS HANDBOOK SHALL BE CONSTRUED TO CONSTITUTE A CONTRACT. XYZ HAS THE RIGHT, AT ITS DISCRETION, TO MODIFY THIS HANDBOOK AT ANY TIME. NOTHING HEREIN LIMITS XYZ”S RIGHTS TO TERMINATE EMPLOYMENT. ALL EMPLOYEES OF XYZ ARE AT-WILL EMPLOYEES.
The handbook contains a section entitled “Code of Conduct.” This section states that it is designed to guide all employees in their relationship with XYZ. It then contains a list of acts that are considered a violation of the Code of Conduct expected of an XYZ employee, and provides that such conduct will be disciplined in accord with its seriousness, recurrence, and circumstances. The list enumerates 20 different acts that constitute violations.
Degrees of discipline are set forth under the section entitled “Discipline” in this manual. The Disciplinary Procedures section of the handbook states that it is the “duty of all employees to comply with, and to assist in carrying into effect [t]he provisions of the personnel policy and procedures.” Additionally, the section provided as follows:
Ordinarily, discipline shall be of an increasingly progressive nature, the step of progression being (1) oral or written reprimand or warning, (2) suspension, and (3) dismissal. Discipline should correspond to the offense and therefore, IF SERIOUS ENOUGH, FIRST VIOLATIONS CAN RESULT IN IMMEDIATE DISMISSAL WITHOUT REPRIMAND OR SUSPENSION.
Assume for the moment that Abigail can show that the reason offered for her termination is not among those listed in the manual and that she was terminated without warning. Abigail also can produce evidence that, prior to her termination, the supervisors in her department always had made reference to the prohibitions listed in the manual in disciplining employees and consistently had complied with the progressive discipline policy, even with regard to serious infractions. Moreover, she can show that the supervisors often made general assurances to the employees that if they did a good job and complied with company policies, they would remain employed.
In light of the foregoing, write a 3-5 page memo evaluating possible weaknesses in XYZ’s disclaimers— that is, discuss how and why the disclaiming language in the handbook might be insufficient to convince a court to dismiss Abigail’s implied-in-fact contract claim (to prevent the claim from getting to a jury, which would otherwise decide whether there was an enforceable contract and whether that contract was breached). Then, after identifying these issues, offer suggestions for changes or additional language that might ensure to a greater extent the disclaimers’ effectiveness.