Bonham v. Dresser Industries, Inc.

Decision Date26 January 1978
Docket NumberNo. 77-1292,77-1292
Citation569 F.2d 187
Parties115 L.R.R.M. (BNA) 4653, 16 Fair Empl.Prac.Cas. 510, 15 Empl. Prac. Dec. P 8028 Emra Joseph BONHAM, Appellant, v. DRESSER INDUSTRIES, INC., a corporation, Appellee.
CourtU.S. Court of Appeals — Third Circuit

James R. Duffy, Fine, Perlow & Stone, Pittsburgh, Pa., for appellant.

Donald E. Seymour, Janice H. Anderson, Kirkpatrick, Lockhart, Johnson & Hutchison, Pittsburgh, Pa., for appellee.

Before VAN DUSEN and ROSENN, Circuit Judges, and STERN, * District Judge.


STERN, District Judge.

Appellant Emra Joseph Bonham filed an action in the United States District Court for the Western District of Pennsylvania against his former employer, Dresser Industries, Inc. The complaint was framed in two counts. Count I, based on the Age Discrimination in Employment Act (ADEA), 29 U.S.C. §§ 621 et seq., charged that Bonham's employment with Dresser was unlawfully terminated on December 31, 1975 "because of his age and for no other just cause." Count II invoked the court's diversity jurisdiction and charged that the termination was a breach of his oral contract of employment actionable under state common law.

Dresser moved to dismiss Count I for lack of subject matter jurisdiction on the ground that plaintiff had failed to file timely charges with both federal and state authorities. Dresser also moved for dismissal of Count II for failure to state a claim. The district court, treating Dresser's motion as a motion for summary judgment, granted judgment for Dresser on both counts.

In granting summary judgment on Count I, the district court determined that the alleged unlawful practice occurred on October 31, 1975, that the federal 180-day period for filing a charge with the Secretary of Labor ran from that date, that Bonham's June 16, 1976 notice to the Secretary of Labor was therefore untimely, and that Bonham's failure to file within 180 days of October 31 was a jurisdictional defect. The district court held, alternatively, that Bonham's ADEA claim was barred for failure to file a charge with state authorities within 90 days. In granting summary judgment on Count II, the district court held that the complaint failed to state a claim under Pennsylvania law. We reverse the district court's grant of summary judgment on Count I of the complaint; we affirm its disposition of Count II.

Bonham, who was in his late forties when the events giving rise to this litigation took place, began working for Dresser Industries in 1969. Through a series of promotions, he reached the position of "manager-factory accounting" at an annual salary of $28,500.00.

The affidavit of Dresser's vice president states that Bonham's employment terminated on October 31, 1975, that Bonham was informed of the termination on or before October 31, 1975, and that Bonham performed no services as a Dresser employee after October 31, 1975. Bonham's personnel card which Dresser made part of the record, indicates that Bonham was terminated on October 31; this document states that the termination was "by mutual consent." 1

Bonham argued here and before the district court that the termination occurred on December 31, 1975. His affidavit states that he was informed on October 31 that he would be terminated as of December 31, 1975, that he was paid his regular salary, periodically from October 31 through December 31, 1975, that the company kept his insurance coverage effective through December 31, and that he was advised, in writing by the company, that his retirement benefits would be calculated on the basis of a December 31 termination date. 2 However, he does not dispute that October 31, 1975 was the day he was told of his termination and that it was the last day he actually worked.

In January of 1976, Bonham wrote directly to the president of Dresser Industries requesting that he be placed in a different division of the company. 3 On January 19, Dresser's president advised Bonham that he had made arrangements to review other opportunities for Bonham within the company. 4 On February 18, 1976, however, Bonham was notified that there would be no position for him within Dresser Industries.

On June 16, 1976, 229 days after the October 31 date urged by the company, 169 days after the December 31 date urged by Bonham, and 118 days after Bonham received word from Dresser that there were no other positions at Dresser for him Bonham gave notice to the Secretary of Labor of his intention to sue. On the same date, he notified the Pennsylvania Human Relations Commission of his allegedly wrongful discharge.

The Age Discrimination in Employment Act of 1967 was designed to promote the employment of persons between the ages of 40 and 64 by prohibiting discriminatory employment decisions based on age. See 29 U.S.C. § 631. The substantive provisions of the Act are enforceable both by governmental actions and by private suits brought by aggrieved persons. Prior to the commencement of any action, the Secretary of Labor must be given an opportunity to eliminate the allegedly discriminatory practice through informal methods. 29 U.S.C. § 626(d). In order to provide the Secretary this opportunity to attempt conciliation, an aggrieved person must notify the Secretary that he intends to sue 60 days before commencing an action.

The Act imposes two additional procedural requirements on private litigants. Section 626(d)(1) provides that the 60-day notice of intent to sue must be filed with the Secretary of Labor "within one hundred and eighty days after the alleged unlawful practice occurred . . . ." Section 633 provides, in pertinent part:

(b) In the case of an alleged unlawful practice occurring in a State which has a law prohibiting discrimination in employment because of age and establishing or authorizing a State authority to grant or seek relief from such discriminatory practice, no suit may be brought under section 626 . . . before the expiration of sixty days after proceedings have been commenced under the State law, unless such proceedings have been earlier terminated: . . .

Both of these procedural requirements are at issue in this lawsuit.

Section 626(d)'s 180-day filing requirement begins to run from the date of the "alleged unlawful practice." At issue here is when that unlawful practice occurred. The litigants agree that the alleged wrongful act was Bonham's termination, but Bonham argues that that occurred on December 31, the date of his last paycheck and the termination of all company benefits. On these facts, we agree with the district court that the termination took place on October 31, 1975, the date urged by Dresser.

Although no simple rule can be formulated which will deal adequately with all factual situations, where unequivocal notice of termination and the employee's last day of work coincide, then the alleged unlawful act will be deemed to have occurred on that date, notwithstanding the employee's continued receipt of certain employee benefits such as periodic severance payments or extended insurance coverage. See Davis v. RJR Foods, Inc., 420 F.Supp. 930, 931 n.1 (S.D.N.Y.1976), aff'd without opinion, 556 F.2d 555 (2nd Cir. 1977); Doski v. M. Goldseker Co., 11 FEP Cas. 468 (D.Md.1975), aff'd in relevant part and remanded, 539 F.2d 1326, 1328 n.3 (4th Cir. 1976); Payne v. Crane Co., 560 F.2d 198, 199 (5th Cir. 1977) (per curiam).

We reject the rule propounded in Moses v. Falstaff Brewing Corp., 525 F.2d 92 (8th Cir. 1975), which looks exclusively to the company's official termination date as reflected in company records. Because, as in the case sub judice, a company may use different termination dates for different purposes, the Moses rule does not adequately resolve the issue. Moreover, we would be wary of any approach which determines the timeliness of an employee's suit against his employer solely on the basis of records which are within the exclusive control of the employer. On the other hand, we would also view with disfavor a rule that penalizes a company for giving an employee periodic severance pay or other extended benefits after the relationship has terminated rather than severing all ties when the employee is let go.

The ADEA is humanitarian legislation which must be interpreted in a humane and commonsensical manner; its 180-day filing period is very short. An employee should not be required to take action to enforce his rights while he continues to work and while his employment status is at all uncertain.

The 180-day period does not begin to run until the employee knows, or as a reasonable person should know, that the employer has made a final decision to terminate him, and the employee ceases to render further services to the employer. Until that time he may have reason to believe that his status as an employee has not finally been determined, and should be given an opportunity to resolve any difficulty while he continues to work for the employer. In any event, a terminated employee who is still working should not be required to consult a lawyer or file charges of discrimination against his employer as long as he is still working, even though he has been told of the employer's present intention to terminate him in the future.

We emphasize that this test is not subjective, and, on the facts of this case we believe that the district judge was correct in ruling that the alleged unlawful practice occurred on October 31, 1975 when Bonham ceased to perform services for Dresser Industries with knowledge and on notice that he was not to return to his job.

Although we agree that October 31, 1975 was the date of the alleged unlawful practice, we do not agree that the action is necessarily foreclosed by Bonham's failure to file within 180 days. Bonham's action is barred only if the 180-day requirement is viewed as strictly "jurisdictional" and not subject to tolling or similar equitable modifications. 5 While...

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