This article examines the standard that the Restatement of Employment law recently adopted for the implied covenant of Good Faith and Fair Dealing (CGFFD) in section 2.07. The standard covers accrued benefits, but misses most of the bad faith and unfair dealing behaviors that show up in the cases when employers take advantage of their employees for reasons unrelated to work. These bad behaviors often take the form of unduly restricting an employee’s decisionmaking about their lives, their liberty, privacy, or autonomy, by implicitly or explicitly threatening to discharge the employee at will. The Restatement favors at-will rather than the CGFFD when the two principles are in tension but provides no reasoned justification for the preference.
The article explains the difference between what a nuanced, and well-developed CGFFD standard can do, and the just cause and public policy exception standards. The article suggests that Robert Summers’ ‘excluder’ concept would provide a better, more responsive, and well-delineated method for developing the CGFFD in employment settings. Finally, the article concludes how weak the Restatement’s version of the CGFFD is in comparison to Alaska and California more fully explained jurisprudence on the CGFFD.
VanderVelde, Lea S, Where is the Concept of Good Faith in the Restatement of Employment? (January 31, 2018). U Iowa Legal Studies Research Paper No 2018-04; Employee Rights and Employment Policy Journal, Vol 21:335-375, 2018.