A New Jersey appeals court has ruled that an anti-harassment clause in Valley National Bank's ethics code could give rise to a breach-of-contract suit by an employee who says she was bullied by her boss.

The appeals court revived Angela Maselli's suit claiming the bank breached promises in its code of conduct. The bank argued it had no contractual obligations, but the text of a disclaimer relied on by the bank does not unambiguously disavow a binding contract to abide by the code, the two-judge panel ruled in Maselli v. Valley National Bancorp. The panel reversed the decision of the motion judge to dismiss the case.

Maselli claims the bank took no action when her supervisor bullied and mistreated her, prompting her to take medical leave and then transfer to another department. She lost her job when her new department, but not the previous one, underwent downsizing.

While she concedes she was an at-will employee, Maselli claims the bank's breach of its code caused her loss of employment.

Valley National, in a motion to dismiss in lieu of an answer, cites a disclaimer at the beginning of its 18-page code of conduct, which said in part, “No employee or agent of Valley National Bank is authorized to make any oral or written representations altering the at-will employment relationship unless made the subject of a specific written contract of employment.” The disclaimer also said, “It should be noted that nothing contained in this Valley Code of Conduct and Ethics or in any policy or work rule of Valley shall constitute a contract of employment or a contract or agreement for a definite or specified term of employment.”

The motion judge dismissed the case after determining the disclaimer was sufficiently prominent, appearing on the first substantive page of the code, set off in a separate paragraph, and introduced by a bold title.

But on appeal, Judges Mitchel Ostrer and Lisa Rose ruled that the title of the disclaimer, “employment is at will,” did not clearly describe the content of the disclaimer. The appeals court also ruled that the text of the disclaimer “does not unambiguously disavow a binding contract to abide by the code.”

The appeals court noted the New Jersey Supreme Court's 1985 decision Woolley v. Hoffmann-La Roche held that an implied promise in an employment manual that an employee may be fired only for cause may be enforceable when the employment term is indefinite.

The Woolley court then said an employer's disclaimer of obligations could be effective but it must be prominent and clear.

The appeals court in Maselli said the bank's disclaimer “does not expressly and unqualifiedly disavow the creation of a contract.” It “denies the creation of a 'contract of employment,'” it said.

According to Ostrer and Rose, by contending that the disclaimer disavows any contractual relationship, the bank interprets the words “of employment” to mean “related to employment in any way.”

But a reasonable employee might conclude that a “contract of employment” means a “contract to employ,” disclaiming any promise of job security or termination only for cause, Ostrer and Rose said.

Since the meaning of the disclaimer is ambiguous, the issue of its effectiveness is reserved for a jury, but dismissal based on the disclaimer was not called for at such an early stage, Ostrer and Rose said.

Michael Harwin, the Fair Lawn, New Jersey, lawyer who represented Maselli, said the ruling would give guidance to courts hearing cases involving at-will employees where an employer has failed to follow its own handbook.

“I think it's a good case that clarifies the law. If you're an at-will employee, they can terminate you, but they still have to follow the handbook,” said Harwin.

Christina Stoneburner of Fox Rothschild in Morristown, New Jersey, who represented Valley National Bank, did not return a call. Marc Piro, a spokesman for the bank, said its policy is to not comment on litigation.