Caldwell v. Ford, Bacon & Davis Utah, Inc.

• Decision Date: 31 July 1989
• Docket Number: No. 20246,20246
• Court: Utah Supreme Court
• Parties: 112 Lab.Cas. P 56,084, 4 IER Cases 1232 Gregory CALDWELL, Plaintiff and Appellant, v. FORD, BACON & DAVIS UTAH, INC., a Utah corporation, Defendant and Appellee.

Page 483

777 P.2d 483

112 Lab.Cas. P 56,084, 4 IER Cases 1232

Gregory CALDWELL, Plaintiff and Appellant, v. FORD, BACON & DAVIS UTAH, INC., a Utah corporation,

Defendant and Appellee.

No. 20246.

Supreme Court of Utah.

July 31, 1989.

Joseph E. Hatch, Salt Lake City, for plaintiff and appellant.

Randall S. Feil, Brent P. Lorimer, Salt Lake City, for defendant and appellee.

ZIMMERMAN, Justice:

Gregory Caldwell appeals from the district court's grant of summary judgment in favor of Ford, Bacon & Davis Utah, Inc. ("FB & D"), claiming that a disputed material issue of fact exists with regard to whether he was wrongfully discharged. We affirm the trial court's grant of summary judgment.

In reviewing a grant of summary judgment, we liberally construe all evidence and reasonable inferences therefrom in favor of the party opposing the motion. Berube v. Fashion Centre, Ltd., 771 P.2d 1033, 1039 (Utah 1989); Payne ex rel. Payne v. Myers, 743 P.2d 186, 187-88 (Utah 1987); Oberhansly v. Sprouse, 751 P.2d 1155, 1156 (Utah Ct.App.1988). After viewing the evidence in this fashion, we must still be convinced that "there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Utah R.Civ.P. 56(c); see, e.g., Geneva Pipe Co. v. S & H Ins. Co., 714 P.2d 648, 649 (Utah 1986). Our factual recitation is in accordance with the above standard of review and casts the facts in a light most favorable to appellant.

Caldwell was hired by FB & D in June of 1981 as a piping drafter and designer. During his hiring interview, there was no mention of any specific duration of employment nor of any employment contract, but Caldwell does recall being told that an employee could not be fired without first receiving three letters or three warnings. FB & D did have a policy that employees would not be discharged for cause without certain warnings. That policy was contained in a policy manual promulgated by FB & D. This manual consisted of a series of numbered "Employee Operations Bulletins" dealing with various company operations and policies. Bulletin No. 902, promulgated by FB & D in April of 1979, prior to Caldwell's hiring, dealt with discharge for cause and described in detail the three steps to be taken prior to any such discharge. Another bulletin in the manual, No. 202, also promulgated in April of 1979, described the procedures and policies governing involuntary discharges other than those for cause. It provided that no notice was due employees involuntarily terminated, but in lieu thereof, they were entitled to separation pay. The amount of such pay was to be determined by a schedule in the bulletin based on the time spent at FB & D. The bulletin specifically stated that an employee dismissed for cause would forfeit all separation pay. The manual was not given to Caldwell at the time he was hired; however, he does recall receiving a copy within six months of his employment. In addition, a copy was available at his work station, and upon termination, Caldwell was given a copy of the policy manual.

Caldwell worked for FB & D from June of 1981 until August 9, 1982, when he received a separation notice. He was given no warning that he was going to be discharged. In fact, a week earlier he had received good-to-excellent job performance ratings and a raise. The separation notice stated that the reason for termination was "reduction of force." Along with the separation notice, Caldwell received a check for $2,069.96, which included separation pay of $1,040, determined in accordance with the schedule in bulletin No. 202. He later negotiated this check.

In June of 1983, Caldwell filed a complaint against FB & D for wrongful discharge. He alleged that he had been discharged for cause without compliance with the procedures set out in bulletin No. 902 of the policy manual and, furthermore, that there had been no just cause for his termination. He also claimed that his termination without cause was in violation of the public policy of the state of Utah.

FB & D denied all of Caldwell's claims and filed a motion for summary judgment, arguing that under Utah law, his employment was terminable at the will of either party and that the policy manual did not alter this relationship. In the alternative, FB & D contended that even if the policy manual modified the at-will character of the employment relationship by requiring FB & D to comply with its terms in discharging employees, Caldwell was nevertheless legitimately terminated involuntarily as a result of a reduction in force and his termination was handled properly under bulletin No. 202. In support of its motion, FB & D filed affidavits showing that FB & D had reduced its work force by approximately seventy-one employees between June of 1982 and June of 1984, that between August of 1982, the month of Caldwell's discharge, and May of 1983, eight of seventeen piping drafters and designers were reduced in force, and that Caldwell's termination was part of this reduction.

Caldwell opposed the summary judgment motion, arguing that the manual modified the traditional employment-at-will relationship, that failure to comply with bulletin No. 902 was a breach of contract and a violation of public policy, and that there was a factual dispute as to whether the dismissal was in fact part of a reduction in force. Caldwell offered no evidence to contradict FB & D's showing of a reduction in force or its affidavit stating that he was discharged pursuant to that reduction, except a statement in an answer to an interrogatory that he was being fired as a scapegoat for a supervisor, a fact allegedly admitted to him in conversation by the supervisor who fired him.

The court granted FB & D's motion for summary judgment without stating its reasons. ¹

On appeal, the parties essentially repeat their arguments below. Caldwell contends that the employment-at-will doctrine was modified by the promulgation of discharge policies and procedures in the policy manual. He relies on any one of three theories for this claim: (i) a breach of the covenant of good faith and fair dealing; (ii) a violation of public policy; and/or (iii) breach of an implied-in-fact contract. If any of the above theories apply in Utah to modify the employment-at-will relationship, Caldwell argues that material issues of fact are in dispute and summary judgment should not have been granted.

FB & D argues, on the other hand, that the employment-at-will doctrine has not been modified in Utah, but even if it has, there is still no material issue of fact in dispute because Caldwell was legitimately reduced in force pursuant to provisions in the policy manual.

This case was argued before our decision in Berube v. Fashion Centre, Ltd., 771 P.2d 1033 (Utah 1989). In Berube, we clarified the law regarding the employment-at-will doctrine and made it plain that employment at will is not a rule of law that envelopes employer-employee relations, but merely a presumption regarding the relationship between the parties that can be rebutted. Id. at 1044, 1050 (Durham, J., joined by Stewart, J.), 1051 (Zimmerman, J., concurring in the result). A majority of the Berube Court declined to recognize a cause of action for a breach of a covenant of good faith and fair dealing under situations such as the present one. Id. at 1050 (Howe, J., concurring, joined by Hall, C.J.), 1051-52 (Zimmerman, J., concurring in the result). A majority of the Court also declined to adopt a broad public policy exception to the employment-at-will doctrine that would routinely make it a violation of public policy to discharge an employee in breach of an employment agreement for other than good cause. ² Id. at 1050 (Howe, J., concurring, joined...