No property right from contract with employee to repay training costs

In LaCoe v. City of Sisseton, United States Court of Appeals, Eighth Circuit, September 19, 2023 --- F.4th ----2023 WL 6115905, the 8th Circuit rejected a former police officer’s attempt to stretch a city’s police department incentive program agreement into a contract for employment. The 8th Circuit Court of Appeals rejected the claim noting that the issue was whether the “contract” manifested a clear intent on the part of the city police department to surrender its at-will power to terminate the employee at any time and for any reason, giving the employee a due process property interest in continued employment. The mere “fact that an employment contract is memorialized in writing does not in and of itself constitute a surrender of an employer’s statutory at-will power.” Instead, the court looked at the contract language:

[Employee] agrees that should she be hired as a police officer for the … Police Department, she will remain in employment of the CITY as a police officer for a minimum of thirty-six (36) months from the date of hire. If she does not remain in employment of the CITY as a police officer for a minimum of thirty-six months from the date of hire, she will reimburse the CITY for any and all costs incurred as enumerated … below . . . .

This did not create a 36-month employment—it merely provided that if employee “does not remain in employment for at least three years, she is obligated to reimburse the City for various expenses … that the City incurs in hiring and training a new police officer, such as uniforms, equipment, Basic Law Enforcement Training, and salary paid during training.”

The Court cited favorably to the contract’s “clear reservation of the City’s statutory at-will termination right”:

[Employee] understands that employment with the … Police Department is contingent upon her completion of a probationary period of twelve (12) months and continued performance to the satisfaction of the … Police Department. Nothing contained herein shall be construed as a promise or agreement by either the … Police Department or the CITY to retain [employee] as a police officer for the … Police Department for thirty-six (36) months or any portion thereof.

Municipalities with employment incentive program agreements similar to the City of Sisseton would do well to ensure such a reservation of at-will status is in their agreements.