Hinson v. Cameron
| Decision Date | 09 June 1987 |
| Docket Number | No. 64159,64159 |
| Parties | 108 Lab.Cas. P 55,849, 4 IER Cases 266, 1987 OK 49 Nita HINSON, Plaintiff-Appellant, v. Patricia CAMERON and Comanche County Hospital Authority, a public trust, Defendants-Appellees. |
| Court | Oklahoma Supreme Court |
Bill Hensley, Jeff Shaw, Hensley & Shaw, Lawton, for plaintiff-appellant.
Dale Reneau, Fenton, Fenton, Smith, Reneau & Moon, Oklahoma City, for defendants-appellees.
Two questions are presented on certiorari: Did an at-will employee, dismissed for her failure to perform an assigned duty, state a cause of action in tort for wrongful discharge from employment? and Did the employee manual alter an at-will relationship between the plaintiff and her employer? We answer both questions in the negative and reinstate the trial court's summary judgment for the defendants.
In an action against Patricia Cameron [Cameron or supervisor] and Comanche County Hospital Authority [Hospital], Nita Hinson [Hinson] sought damages for what we characterize either as a tort of wrongful discharge from employment or, in the alternative, as a breach of employment contract.
Hinson had been employed at the Hospital as a nurse's assistant from March 1968 until May 17, 1983. On the night of May 16, 1983 Hinson reported to work and reviewed the duty sheet assigned to her by Cameron, her supervisor. Hinson claims that she received no additional orders during her shift from her supervisor, written or oral. At the completion of her shift, Hinson checked the original assignment sheet against her copy to reaffirm that she had fulfilled all of her assigned duties. Forgetting to turn in her copy, Hinson returned to the Hospital the next morning, May 17, 1983. When she arrived she was asked to report to the personnel office and was terminated for not following orders. 1
Hinson claims the order that precipitated her discharge was never given to her either at the beginning or during the fateful shift. She asserts that Cameron subsequently altered the assignment sheet and argues that the employee manual, which constitutes a part of her employment contract with the Hospital, protects her from discharge absent good cause.
Summary judgment is proper only when no substantial controversy exists as to any material fact. 2 Under tort rubric Hinson argues that her supervisor altered the duty sheet to fabricate, in bad faith, a false reason for her termination. In support of her breach-of-contract theory Hinson contends the employee manual constitutes a binding agreement that protects her from dismissal other than "for cause." Hinson's conclusion is that she was fired without cause and that the Hospital's "manufactured" ground for her dismissal constitutes either a breach of her employment contract or a tort of wrongful discharge or both.
We hold that the trial court correctly rendered summary judgment for both the Hospital and the supervisor. Since Hinson makes no argument here that the supervisor improperly or tortiously interfered with her employment relation, we need not pause to consider whether the evidentiary material before us would support Hinson's tort claim against the supervisor alone for actionable interference with her employment status. 3
HINSON'S CONTENTIONS IN SUPPORT OF HER TORT CLAIM FOR
Hinson asserts she was wrongfully terminated by the Hospital which acted in reliance on Cameron's falsehood. In her deposition she relates the basis for her termination was her failure to follow an order that Cameron never gave her. She accuses Cameron of subsequently altering the duty sheet to insert a fictitious assignment. Hinson argues the employer was in bad faith and her dismissal wrongful because her employment was not reinstated after the Hospital had been informed of Cameron's false entry upon the duty sheet.
The appellate court's reversal of summary judgment against Hinson rests on Hall v. Farmers Ins. Exchange. 4 Hall came to be perceived as creating a new cause of action in favor of an at-will employee discharged in "bad faith." As we view Hall, it stands for the rule that an agent may recover from the principal when the latter has, in bad faith, deprived him of the fruit of his own labor. 5 The relationship between the Hospital and Hinson was that of master and servant, not principal and agent. Hinson is not claiming the Hospital deprived her of any earned income. In short, the facts and the legal relations dealt with in Hall are clearly distinguishable from those in the present case.
Under the American common-law rule, when the length of the master/servant relationship is unspecified by contract, 6 either the employer or employee can terminate the employment without liability. In some states this doctrine has been modified by exceptions that restrict the grounds on which an at-will employee may be discharged. The exceptions generally rest on three distinct theories: (a) public policy tort, (b) tortious breach of an implied covenant of good faith and fair dealing and (c) implied contract that restricts the employer's power to discharge. 7
A. PUBLIC POLICY UNDERPINNINGS FOR A WRONGFUL DISCHARGE TORT
An at-will employee's discharge has been declared to be actionable on several public policy grounds. Claims recognized under this rubric are those by employees dismissed for (a) refusing to participate in an illegal activity; 8 (b) performing an important public obligation; 9 (c) exercising a legal right or interest; 10 (d) exposing some wrongdoing by the employer; 11 and (e) performing an act that public policy would encourage or, for refusing to do something that public policy would condemn, when the discharge is coupled with a showing of bad faith, malice or retaliation. 12
Were we to measure Hinson's claim by any of these nationally recognized public policy exceptions, we would be nonetheless compelled to conclude that she has no actionable tort claim for wrongful discharge. Her termination was not in direct violation of any public policy. Neither the Hospital nor Cameron ordered Hinson to perform an illegal act or denied her an opportunity to exercise her legal rights. She was not prevented from performing an important public obligation nor was her termination occasioned by articulated concerns for the Hospital's legal or ethical misconduct.
B. IMPLIED COVENANT OF GOOD FAITH AND FAIR DEALING
The covenant of good faith and fair dealing that is implied in law requires that neither party do anything that will injure the right of others to receive the benefits of their agreement. 13 This theory is said to have its basis in the general principle of good faith and fair dealing that is infused by force of law into every contract. 14 Whether a duty to terminate solely for good cause should be written into every at-will employment relationship is a question which has been addressed in a minority of jurisdictions. 15 Courts that considered this question have generally refused to imply such a duty. The concerns viewed as militating in favor of the concept's rejection are that undue restrictions placed on employers would infringe upon their legitimate exercise of managerial discretion. 16
California has come closer than any other jurisdiction to implying a good-faith duty in all employment-at-will contracts. 17 Neither the logic of the California decisions adopting the argued-for implied covenant of good faith nor the scenario considered in these cases persuades us to fashion so broad a rule to govern the case before us. We hence decline today to impose upon the employer a legal duty not to terminate an at-will employee in bad faith. 18 Assuming there may be an implied covenant of good faith and fair dealing in every at-will employment relation, that covenant does not operate to forbid employment severance except for good cause. The court's adoption of a contrary view would "subject each discharge to judicial incursions into the amorphous concept of bad faith." 19
C. IMPLIED CONTRACT
Under the implied contract restrictions of the freedom to discharge an at-will employee, courts have found from particular facts that the parties had intended a contract of permanent employment or one of tenured job security. Factors which have been isolated as critical to evaluate whether an implied contract right to job security exists are: (a) evidence of some "separate consideration" beyond the employee's services to support the implied term, (b) longevity of employment, (c) employer handbooks and policy manuals, (d) detrimental reliance on oral assurances, pre-employment interviews, company policy and past practices and (e) promotions and commendations. 20
Hinson maintains that the Hospital's employee manual constitutes a contract by implication and its provisions are binding. The employee manual contains information about hospital policies and employee benefits. According to Hinson's argument her termination was "without cause" because it was not based on any of the grounds listed in, and hence sanctioned by, the manual. 21 Thus, she concludes, her termination was in breach of the employment contract.
The Hospital asserts that the employee manual does not constitute a contract. It cites to several authorities for the basis of this argument. 22 According to the Hospital's position, Hinson had neither a written nor an implied contract but stood in the status of an at-will employee terminable at any time with or without cause.
In Langdon v. Saga Corp., 23 the Court of Appeals held that an employer's personnel manual providing for certain employee benefits--e.g., vacation and severance pay--created a contractual basis for a terminated employee's claim to those benefits. 24 The court used unilateral contract concepts to deal with the consideration problem. It held that it was possible to construe the employer's personnel manual "as an offer for a unilateral...
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