[tptacek]

It is extraordinarily unlikely that her contract is going to have anything in it that protects her from (what is in effect) constructive termination. Boilerplate employment contracts are designed specifically to avoid conferring obligations on the company.

On the plus side, at-will employment is a huge boon to those of us who start companies, and is one of the major differences between the US and Europe. So there's that.

Like everyone else is implying, the best way she can get back at them is to find a way to make sure the name of this company gets out. I wouldn't do business of any sort with a firm that employed this tactic.

[knowtheory]

It's worth adding however that contracts aren't alway bullet proof either. Contracts are supposed to be binding, but there are ways to wiggle out of clauses here and there, when you can argue that things are unreasonable. That said, knocking out clauses in a contract isn't going to help here. If there is any additional paper trail (say emails) that indicates they were misleading your, or that this is regular behavior, that may be a different matter.

But tptacek is likely correct that there probably isn't any recourse in this case.

[samstave]

I doubt it is in the contract, just that the overall behaviour is odd.