Pyle v. Ledex, Inc.

• Decision Date: 18 April 1988
• Docket Number: No. CA87-09-020,CA87-09-020
• Citation: 551 N.E.2d 205,49 Ohio App.3d 139
• Parties: , 115 Lab.Cas. P 56,260, 5 IER Cases 526 PYLE, Appellant, v. LEDEX, INC., Appellee. *
• Court: Ohio Court of Appeals

Page 139

49 Ohio App.3d 139

551 N.E.2d 205, 115 Lab.Cas. P 56,260, 5 IER Cases 526

PYLE, Appellant, v. LEDEX, INC., Appellee. ^*

No. CA87-09-020.

Court of Appeals of Ohio, Twelfth District, Clinton County.

April 18, 1988.

Syllabus by the Court

1. Unless the parties otherwise agree, either party to an employment-at-will agreement may terminate the employment relationship for any reason not contrary to law.

2. An employee handbook or manual is one factor to consider in order to determine whether an employment-at-will agreement has been modified regarding terms concerning discharge. General disclaimers in such manuals, however, will be construed as a clarification or reemphasis of the at-will employment relationship.

3. Statements by management that employees may be fired for failing to obey company rules in an employee handbook cannot form the basis for an action in promissory estoppel since the threat to discharge an employee for violating rules does not constitute a promise of employment if such rules are followed.

4. Parties to an employment-at-will agreement are under no duty to deal fairly or act in good faith within the employment relationship.

Ruppert, Bronson & Chicarelli Co., L.P.A., Franklin, and Leslie S. Landen, Lebanon, for appellant.

Pickrel, Schaeffer & Ebeling Co., L.P.A., and Janet K. Cooper, Dayton, for appellee.

JONES, Presiding Judge.

Plaintiff-appellant, Conya J. Pyle, was hired by defendant-appellee, Ledex, Inc., on September 8, 1964, as an assembly line worker. Appellant gradually moved up through the ranks until she attained the position of group leader in the shipping/stockroom division in 1980. On September 27, 1985, appellant was discharged for deliberately restricting production when she told two employees in her department to "slow down." Appellant admitted that she made the statement in question but claimed that she was only joking and that her remarks were not meant to be taken seriously.

When she was hired, appellant received what she described as an employee handbook which contained, among other things, certain disciplinary rules. This manual or handbook was eventually replaced by the Ledex "Welcome Book." The Welcome Book contained a section entitled "Rules of the Road," which contained the following:

"Every organization has regulations for the orderly conduct of business and pleasure. People cannot live and work together successfully and enjoyably without order. Some basic 'Rules of the Road' have been established by our Company.

"Here are our rules; they have helped us at Ledex work together for years. Please realize that these rules are based on common sense. Just as you may lose your driver's license if you disregard traffic regulations, you can lose your job at Ledex if you disregard our 'Rules of the Road.'

" * * *

"Take time to study our 'Rules of the Road.' Beside each rule and regulation is listed the discipline that can be taken. Ledex retains the right to create new rules, to amend or delete rules and procedures and to enforce penalties or disciplinary action."

The Welcome Book contained forty "Rules of the Road" which covered employee conduct ranging from the unauthorized use of company telephones for personal reasons to theft of company property. The disciplinary procedure for rule violations included written notice of the violation to the employee, suspension without pay, and discharge. Depending upon the particular rule violated and the seriousness of the infraction, Ledex could invoke any of the three formal procedures or a progressive combination thereof, ultimately resulting in the employee's discharge. Appellant was discharged for violating that rule which prohibited employees from "deliberately restricting production" when she told the two employees in her department to slow down.

In 1984, Ledex issued a number of revisions to the Welcome Book. Included in those revisions was a disclaimer appearing in large prominent lettering on the back cover page of the Welcome Book. It provided that:

"THIS HANDBOOK IS NOT INTENDED TO CONSTITUTE AN EMPLOYMENT CONTRACT BETWEEN LEDEX AND ITS EMPLOYEES. EMPLOYEES ARE FREE TO RESIGN FROM THE COMPANY WHENEVER THEY WISH, AND THE COMPANY IS NOT RESTRICTED FROM TERMINATING AN EMPLOYEE AT ANY TIME FOR ANY REASON."

Appellant could not produce the employee manual provided to her in 1964. She claimed in her deposition, however, that the 1964 manual was substantially similar to the Welcome Book which Ledex later issued in its place. Appellant claimed that she understood the manual's rules and regulations to mean that she would receive job security so long as she obeyed the rules and performed her duties.

On June 5, 1986, appellant filed a complaint against Ledex, alleging four cases of action which included breach of express or implied contract, promissory estoppel, and violation of a duty to deal fairly and in good faith. ¹

On May 27, 1987, Ledex moved for summary judgment. The trial court subsequently granted Ledex's motion, finding that appellant was an employee-at-will and that either appellant or Ledex could terminate the employment relationship for any reason not contrary to law. The court further found that the Welcome Book did not constitute an employment contract or otherwise alter the at-will relationship. The court also found that the disclaimer in the Welcome Book precluded appellant's promissory estoppel action. The court finally determined that Ledex was under no obligation to deal fairly or in good faith within the employment context.

Appellant timely appealed and as her sole assignment of error claims that the trial court erred in granting Ledex's summary judgment motion and dismissing her complaint. Under this assignment of error, appellant raises three issues which essentially claim the following:

1. Appellant claims that the 1964 employment manual setting forth disciplinary rules and procedures creates an express or implied employment contract which cannot be abrogated by a disclaimer in a subsequent manual written nearly twenty years after appellant was hired.

2. Appellant claims that representations in the employee handbook and oral statements by Ledex management serve as a basis for promissory estoppel where appellant justifiably relied on such representations to her detriment.

3. Appellant claims that Ledex was under a duty to deal fairly and in good faith with her when she had relied on the written and oral representations of Ledex during the twenty years of her employment.

I

In reviewing the summary judgment rendered below, our analysis requires a consideration of the employment-at-will doctrine and its application to the case at bar. The basic doctrine recognizes the right of either party to an oral employment contract to terminate the employment relationship for any reason which is not contrary to law. Mers v. Dispatch Printing Co. (1985), 19 Ohio St.3d 100, 19 OBR 261, 483 N.E.2d 150; Henkel v. Educational Research Council (1976), 45 Ohio St.2d 249, 74 O.O.2d 415, 344 N.E.2d 118. Generally, where the employee furnishes no consideration other than his or her services incident to the employment, the relationship amounts to an indefinite general hiring terminable at the will of either party unless the terms of the contract or other circumstances clearly manifest the parties' intent to bind each other. Id. Ohio courts have long adhered to the doctrine's general rule that absent any " * * * facts and circumstances which indicate that the agreement is for a specific term," the employer may discharge the employee at any time, with or without cause. Id. at syllabus; Fawcett v. G.C. Murphy & Co. (1976), 46 Ohio St.2d 245, 75 O.O.2d 291, 348 N.E.2d 144; Evely v. Carlon Co. (1983), 4 Ohio St.3d 163, 4 OBR 404, 447 N.E.2d 1290; South v. Toledo Edison Co. (1986), 32 Ohio App.3d 24, 513 N.E.2d 800; and Peterson v. Scott Constr. Co. (1982), 5 Ohio App.3d 203, 5 OBR 466, 451 N.E.2d 1236. See, also, Meredith v. Rockwell Internatl. Corp., (C.A.6, 1987), 826 F.2d 463.

The recent trend, however, as reflected by the Supreme Court's decision in Mers v. Dispatch Printing, supra, has been to carve out exceptions to the at-will status of employment relationships and limit the employer's right to summarily dismiss an employee. The Mers court, while recognizing the continuing efficacy of the doctrine in general, nevertheless established two important exceptions to that doctrine, as reflected in paragraphs two and three of the court's syllabus:

"The facts and circumstances surrounding an oral employment-at-will agreement, including the character of the employment, custom, the course of dealing between the parties, company policy, or any other fact which may illuminate the question, can be considered by the trier of fact in order to determine the agreement's explicit and implicit terms concerning discharge.

"The doctrine of promissory estoppel is applicable and binding to oral at-will employment agreements. The test in such cases is whether the employer should have reasonably expected its representation to be relied upon by its employee and, if so, whether the expected action or forbearance actually resulted and was detrimental to the employee."

The paragraphs quoted above provide the basic foundation for appellant's appeal. Appellant's position is that a genuine factual issue exists with respect to her employment relationship with Ledex in light of the Mers decision. Specifically, appellant submits that certain representations contained in the Ledex employment handbook coupled with oral statements by Ledex management call into question the at-will nature of her employment relationship and require resolution of the issue by the trier of fact.

II

Before addressing the arguments appellant raises on appeal, we first observe that her reliance on our earlier decision of Dax v. Meck (June 30, 1986), Butler App. No. CA85-05-046, unreported, 1986 WL 7394, is misplaced.

The case at bar involves the review...