Featherly v. Teledyne Industries, Inc.

• Decision Date: 18 May 1992
• Docket Number: Docket No. 126875
• Citation: 486 N.W.2d 361,194 Mich.App. 352
• Parties: Norman FEATHERLY and Stanley Way, Plaintiffs-Appellants, and Leroy Gannon, Plaintiff-Cross-Appellee, v. TELEDYNE INDUSTRIES, INC., d/b/a Teledyne Continental Motors General Products Division and Thomas Keenan, Defendants-Appellees, Cross-Appellants.
• Court: Court of Appeal of Michigan — District of US

Page 361

486 N.W.2d 361

194 Mich.App. 352

Norman FEATHERLY and Stanley Way, Plaintiffs-Appellants and Leroy Gannon, Plaintiff-Cross-Appellee, v. TELEDYNE INDUSTRIES, INC., d/b/a Teledyne Continental Motors General Products Division and Thomas Keenan Defendants-Appellees, Cross-Appellants.

Docket No. 126875.

Court of Appeals of Michigan.

Submitted April 21, 1992, at Grand Rapids.

Decided May 18, 1992, at 9:50 a.m.

Released for Publication Aug. 3, 1992.

Libner, Van Leuven, Kortering, Evans & Portenga, P.C. by John A. Braden, for plaintiffs-appellants.

Butzel Long by Robert J. Battista and Mark T. Nelson, Detroit, for defendants-appellees, cross-appellants.

Before HOOD, P.J., and SHEPHERD and SANBORN, ^* JJ.

SHEPHERD, Judge.

This case involves claims of employment discrimination and breach of contract under Toussaint v. Blue Cross & Blue Shield of Michigan, 408 Mich. 579, 292 N.W.2d 880 (1980), in which the trial court granted defendants' motion for summary disposition pursuant to MCR 2.116(C)(10) with respect to the age discrimination claims of plaintiffs Norman Featherly and Stanley Way, denied defendants' motion with respect to the age discrimination claim of plaintiff Leroy Gannon, and granted defendants' motion with respect to the Toussaint claims of all three plaintiffs. Plaintiffs Featherly and Way appeal as of right the dismissal of their age discrimination claims, plaintiff Way appeals the dismissal of his Toussaint claim, and defendants cross appeal the denial of their motion with respect to the age discrimination claim of plaintiff Gannon.

As a result of a business downturn, Teledyne laid off 250 people, including both salaried and union personnel, in December 1987. After consultations with the company's finance department in the fall of 1987, defendant Thomas Keenan, Teledyne's president, approved the layoff plan and instructed each vice president in the various departments of the plant to lay off a certain number of employees. The selection of which employees to lay off was made by the immediate supervisor with the concurrence of the manager or vice president of the department or area. Each plaintiff is a former supervisor of Teledyne who was laid off in December 1987 and claims that his layoff was in violation of the Civil Rights Act, M.C.L. Sec. 37.2101 et seq.; M.S.A. Sec. 3.548(101) et seq., and in breach of an implied contract of employment. It was undisputed that each plaintiff was a competent and capable supervisor in his respective area, and that Teledyne claimed to have laid them off because of economic necessity. There is also no dispute that layoffs of numerous employees were, in fact, mandated by economic necessity. The primary issue in this case is whether, in choosing which employees to lay off, the defendants made their selection by using age as a determining factor.

We begin with the assumption that although there may be justification for economic layoffs, an employer may not decide which employees to lay off on the basis of considerations that are prohibited by law, such as race, gender, or age. See King v. Michigan Consolidated Gas Co, 177 Mich.App. 531, 442 N.W.2d 714 (1989), where the plaintiff's federal civil rights claim based on race was permitted to go to trial even though the employer was faced with an economically necessitated reduction in force. Subsequently, his claim of racial discrimination in violation of state law was also allowed to stand. See also Schipani v. Ford Motor Co, 102 Mich.App. 606, 302 N.W.2d 307 (1981), in which the plaintiff's Toussaint and age discrimination claims were treated separately. Both cases taken together implicitly stand for the proposition that where an employer has a legitimate reason to terminate (e.g., economic necessity or a contract for employment at will), it may not do so for illegal reasons such as unlawful discrimination.

Since 1975, Norman Featherly had been the production supervisor of the crankshaft departments (Department Nos. 313 and 316). As a result of the 1987 reduction, the crankshaft departments and "Gears" (Department No. 311) were consolidated. Production Superintendent Harvey Myers, Featherly's immediate supervisor, and Robert Bramer, the manufacturing manager, decided that Featherly should be laid off because they concluded that he did not have the versatility to supervise both departments. Consequently, Featherly's duties were added to those of Robert Gilbert, the production supervisor of "Gears." At the time of his layoff, Featherly was fifty-eight years old and had approximately twenty-five years' seniority, whereas Gilbert was forty-one years old and had twelve years of supervisory experience.

Leroy Gannon was the supervisor of "non-productive stores" and "cutter grinds" from 1976 until his layoff in 1987. His duties involved maintenance, repair, and operations, as well as resharpening and testing tools. His position was eliminated and his duties were assigned to Thomas Karafa and Harry Mikesell. Karafa is a toolmaker, who was the supervisor of the model shop and tool repair at the time of the layoffs. Mikesell is a manufacturing engineering analyst, whose job is to prepare budgets for the Manufacturing Engineering Department. At the time of his layoff, Gannon was sixty-three years old, whereas Karafa and Mikesell were forty-one and sixty years old, respectively.

From May, 1966 until his layoff in 1987, Stanley Way was a production control supervisor whose duties involved shipping and receiving. After his position was eliminated in the 1987 reduction, his duties were added to those of Bill Ford, the "Master Scheduler." Ford was retained because Way had no experience with or knowledge of scheduling systems. At the time of Way's layoff, he was fifty-nine years old and had thirty-seven years' seniority, whereas Ford was fifty-six years old. In addition, the clerical work related to Way's position was assigned to Virginia Settler, a sixty-year-old union clerk who had forty-three years' seniority with Teledyne.

A motion for summary disposition pursuant to MCR 2.116(C)(10) may be granted when, except for the amount of damages, there is no genuine issue with regard to any material fact and the moving party is entitled to judgment or partial judgement as a matter of law. A motion for summary disposition tests whether there is factual support for a claim. The trial court must consider the affidavits submitted, pleadings, depositions, admissions, and documentary evidence. Amorello v. Monsanto Corp., 186 Mich.App. 324, 329-330, 463 N.W.2d 487 (1990). The party opposing the motion has the burden of showing that a genuine issue of material fact exists. Ewers v. Stroh Brewery Co., 178 Mich.App. 371, 374, 443 N.W.2d 504 (1989). Giving the benefit of reasonable doubt to the nonmovant, the trial court determines whether a record might be developed that would leave open an issue upon which reasonable minds might differ. Amorello, supra, 186 Mich.App. at 330, 463 N.W.2d 487. The court may not make findings of fact or weigh credibility in deciding a motion for summary disposition. Paul v. U.S. Mutual Financial Corp., 150 Mich.App. 773, 779, 389 N.W.2d 487 (1986).

Plaintiffs' claims of age discrimination are based upon the Civil Rights Act, which provides:

(1) An employer shall not:

(a) Fail or refuse to hire, or recruit, or discharge, or otherwise discriminate against an individual with respect to employment, compensation, or a term, condition, or privilege of employment, because of ... age.... [M.C.L. Sec. 37.2202; M.S.A. Sec. 3.548(202).]

Michigan courts have considered federal law when reviewing claims of age discrimination based on state law. See Matras v. Amoco Oil Co., 424 Mich. 675, 683-685, 385 N.W.2d 586 (1986); Meeka v. D & F Corp., 158 Mich.App. 688, 692, 405 N.W.2d 125 (1987); Dixon v. W W Grainger, Inc., 168 Mich.App. 107, 113-114, 423 N.W.2d 580 (1987). Reaffirming the holding of McDonnell Douglas v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973), the United States Supreme Court in Texas Dep't of Community Affairs v. Burdine, 450 U.S. 248, 252-253, 101 S.Ct. 1089, 1093-94, 67 L.Ed.2d 207 (1981), set forth the order and allocation of the burden of proof in employment discrimination cases as follows. First, the plaintiff has the burden of proving by a preponderance of the evidence a prima facie case of discrimination. Second, if the plaintiff is successful in proving a prima facie case, the burden shifts to the defendant to articulate some legitimate, nondiscriminatory reason for its actions. Third, if the defendant meets this burden, the plaintiff then has the burden of proving by a preponderance of the evidence that the legitimate reason offered by the defendant was merely a pretext. Id.; Dubey v. Stroh Brewery Co, 185 Mich.App. 561, 563-564, 462 N.W.2d 758 (1990).

To establish a prima facie case of age discrimination, the plaintiff must show that (1) he was a member of a protected class, (2) he was discharged, (3) he was qualified for the position, and (4) he was replaced by a younger person. Ewers, supra, 178 Mich.App. at 379-380, 443 N.W.2d 504. Age discrimination may also be established by ordinary principles of proof without resort to any special judicially created presumptions or inferences. Matras, supra, 424 Mich. at 683, 385 N.W.2d 586. In an age discrimination claim, the plaintiff must present evidence that (1) he had skills, experience, background, or qualifications comparable to the retained employee and (2) his age was a determining factor in the adverse employment decision. Id., at 683-684, 385 N.W.2d 586; Meeka, supra, 158 Mich.App. at 692, 405 N.W.2d 125. Evidence that a competent older employee was terminated and a younger employee was retained, standing alone, is insufficient to establish a prima facie case when the employer reduces his work force because of economic necessity. Matras, 424 Mich. at 684, 385 N.W.2d 586.

Viewing the evidence in a light most...