Naturally, the internet only cares that one of their favourite movies is being mentioned by judges, and isn't this wonderful? However, it's definitely worth taking a look at the entirety of the decision. (PDF link) I'm not expecting you to read it, so I'll summarise the facts. Do bear in mind that I'm a layman, and I may misunderstand things.
The appellants are a number of people who were, in 2002, employed by Du Pont. Du Pont decided to spin the division in which they worked off as a separate company; this led to friction, since many of the employees within that division were represented by a union, which led to there being a strong collective bargaining agreement. Now, this all happened in Texas, and Texas is a state in which there is a strong presumption that any given employee can be fired whenever, for good reason or for no reason, at any point in their employment, unless they have a contract stating otherwise. This state of affairs is called at-will employment, which I consider misleading as a term, but I digress. The employees appealing in this case fall into two groups: those covered by the collective bargaining agreement, and some that aren't (because they weren't working in areas which fall within the purview of that particular union).
So, let's look at the collective bargaining, shall we? According to the judgement, it contained the following relevant provisions:
- Seniority. An employee would accrue seniority by continuing to work, and in the event of layoffs, those with least seniority would be laid off first.
- Requirement for cause. Employees had to have given good cause to be fired.
- Probationary period. Within the first 9 months, you were vulnerable, but if you made it nine months, you had to be screwing up to get fired.
- Grievance and disciplinary procedures. There was a graded scale of disciplinary procedures to be used in the event of unsatisfactory job performance, up to and including being fired; and there was a grievance procedure in place allowing an employee who felt he'd been fired unreasonably to appeal.
- Evergreen clause. The collective bargaining agreement was going to stay in force until either side nixed it by giving sixty days' notice.
So, that was the collective bargaining agreement. What actually happened?
Well, the agreement reached before the spinoff was that the employees had a choice: they could stay with Du Pont, in which case Du Pont would find them other work, and lay off people with less seniority to allow them to work; or they could go to the new company, where they'd be covered by an identical agreement, their relative seniority would be preserved, and it would all be fine. They were also assured during the process that the spinoff was not going to result in their division being sold to some random investor other than the parent company of Du Pont. It apparently wouldn't make sense.
So the spinoff was finalised in early 2003. The appellants in this case are the ones who went with their jobs, rather than changing jobs to stay with their employer. Not two months after the spinoff, it was announced that their new company was being touted for sale, and the current owners were in fact in the early stages of negotiating such a sale. Who didn't see that one coming?
About a year later, the sale was finalised, and onward we go. It later emerged that the idea of a sale first came up before the talks about how to handle the spinoff started; now there's a surprise. The employees suing assert that their pensions, pay, and benefits - all of which they were assured would remain the same - got worse under the new ownership. They're alleging that they were lied to in order to induce them to go with their jobs.
To me, it looks open and shut, but in Texas it's apparently not that simple; the issue in the appeal is whether the employees were at-will or not. Remember that the defining feature of at-will is the whole "fire at any time, without a requirement to provide cause" thing? That certainly doesn't look to me like it's the case here. However, this is a Federal court ruling on a point of Texas law, so there's actually no precedent to guide them. They had to make a best guess at what a Texas court would decide.
And here's where it gets screwy. The majority opinion looked at other contracts modifying employment presumptions; they looked, specifically, at cases involving fixed-term contracts. Interestingly, in Texas, if you've got a contract for a year, they'll have to provide cause if they want to fire you after six months. However, a lot of such contracts will provide for termination of the contract for any reason provided notice is given. This is kind of an end-run, but the key points for the majority decision are that the effect of the contract being freely terminable creates a de facto at-will relationship.
But, of course, it's not that simple. A fixed-term employment contract has a defining feature: a fixed term. One of the defining features of the collective bargaining agreement I listed above is that it was NOT fixed-term; it would stay in force until either side decided they needed to renegotiate, at which point it could be terminated with notice. Moreover, it's a general requirement of collective bargaining agreements which provide grievance procedures that even if they're terminated, those procedures stay in place until either they're superseded by the new procedures, or the negotiations become deadlocked. Terminating a collective agreement like that doesn't wipe it out; it's more "notice of intent to renegotiate".
And then we have the issue which brought up the Princess Bride: the majority opinion used the phrase "sufficiently not at-will" to describe how the appellants had to be situated to sue. They then decided that although they were kind of not at-will, what with the whole termination clause, they weren't not at-will enough to be protected. The dissenting opinion which cites the Princess Bride is essentially pointing out that there is a clear distinction. You're at-will or not. Just like "pregnant" or "dead", there's no way of being only a little bit. The Princess Bride was being cited as an example of absurdity occasioned by applying modifiers to an absolute condition.
See how much deeper it goes than merely "a judge mentioned one of my favourite movies in an opinion"? The law is fascinating, even to laypeople.
Obligatory note: I am not in any way a lawyer. Although I am married to an attorney, she did not make any contributions to this article. You can reasonably expect me to have made errors, misrepresented things, and generally screwed it up; this is what happens when non-lawyers start looking under the hood of law stuff.