Rushton v. Meijer, Inc.

• Decision Date: 19 August 1997
• Docket Number: Docket No. 199684
• Citation: 225 Mich.App. 156,570 N.W.2d 271
• Parties: , 72 Empl. Prac. Dec. P 45,033, 13 IER Cases 167 Christine M. RUSHTON, Plaintiff-Appellee, v. MEIJER, INCORPORATED, Defendant-Appellant. (On Remand)
• Court: Court of Appeal of Michigan — District of US

Page 271

570 N.W.2d 271

225 Mich.App. 156, 72 Empl. Prac. Dec. P 45,033,

13 IER Cases 167

Christine M. RUSHTON, Plaintiff-Appellee, v. MEIJER, INCORPORATED, Defendant-Appellant. (On Remand)

Docket No. 199684.

Court of Appeals of Michigan.

Submitted Dec. 9, 1996, at Lansing.

Decided Aug. 19, 1997, at 9:25 a.m.

Released for Publication Nov.6, 1997.

Wascha & Waun, P.C. by Thomas W. Waun, Grand Blanc, for Plaintiff-Appellee.

Jeffrey A. Rueble, Grand Rapids, and Miller, Canfield, Paddock and Stone by Charles S. Mishkind and Diane M. Soubly, Detroit, for Defendant-Appellant.

Dickinson, Wright, Moon, Van Dusen & Freeman by John Corbett O'Meara, Thomas G. Kienbaum, and Noel D. Massie, Detroit Before FITZGERALD, P.J., and TAYLOR and HOLBROOK, JJ.

for American Society of Employers and others.

ON REMAND

HOLBROOK, Judge.

This case is on remand to us from the Michigan Supreme Court, 453 Mich. 943, 557 N.W.2d 308 (1996), for reconsideration in light of Heurtebise v. Reliable Business Computers, Inc., 452 Mich. 405, 550 N.W.2d 243 (1996). We reverse in part and affirm in part.

As we stated in our earlier opinion:

Plaintiff worked as a part-time floor detective for defendant Meijer, Incorporated. When she was hired by Meijer, plaintiff signed an employment form agreeing to abide [by] defendant's policies and procedures. Plaintiff acknowledged receipt of an associate handbook which included defendant's termination appeal procedure. This document unambiguously provided that terminated employees were required to exhaust the alternate dispute resolution (ADR) procedure. A separate document which plaintiff received indicated that exhaustion of the ADR procedure is a condition precedent to litigation, regardless of whether the arbitrator's final decision is upheld by a trial court.

When defendant terminated plaintiff's employment, she [plaintiff] invoked the ADR procedure. She indicated that she believed she had been discharged without just cause, that she was the victim of gender discrimination, and that she had been retaliated against for complaining about not being given a full-time job. Following an investigation, plaintiff's discharge was upheld at step one of the ADR procedure. Plaintiff chose not to pursue the next step in the procedure, binding arbitration, and instead filed a lawsuit alleging wrongful discharge, gender discrimination, and retaliation. Defendant moved for summary or partial disposition, or for an order enforcing the ADR award or procedure. At the hearing on defendant's motion, plaintiff withdrew her retaliation claim. The court then denied defendant's motion for summary disposition of the wrongful discharge and gender discrimination claims. [Rushton v. Meijer, Inc., unpublished memorandum opinion of the Court of Appeals, issued March 1, 1995 (Docket No. 164272).]

In our original opinion, we reversed the trial court's denial of a defense motion for summary disposition of plaintiff's wrongful discharge and gender discrimination claims because plaintiff had failed to exhaust the remedies available to her pursuant to the ADR procedure that defendant had established to resolve such claims. In reversing the trial court's denial of defendant's motion for summary disposition of plaintiff's gender discrimination claim, we relied on Heurtebise v. Reliable Business Computers, Inc., 207 Mich.App. 308, 523 N.W.2d 904 (1994), as controlling precedent for the proposition that private agreements to arbitrate civil rights claims are enforceable.

I

The Michigan Supreme Court reversed this Court's decision in Heurtebise, because the employee handbook contained language demonstrating that the employer did not intend to be bound by its provisions. 452 Mich. at 414, 550 N.W.2d 243. As the Supreme Court noted, the handbook in Heurtebise contained clauses stating: (1) the policies in the handbook do not create any employment or personal contract, express or implied; (2) the employer had the right to terminate employees' employment at any time, without notice, for any reason; and (3) the employer reserved the right to make modifications to any or all of the policies in the handbook. Thus, the instrument in Heurtebise expressly disclaiming contract status, yielding the employee no benefit above the minimal required status even to be an employee--namely, at-will status--and having provisions that could be changed unilaterally by the employer was, as might be expected, determined not to be a contract by the Supreme Court.

It is in light of this holding that we are directed to reexamine the Meijer employee handbook. The dissimilarities are marked. Unlike the Heurtebise handbook, the Meijer handbook does not contain language stating that Meijer does not intend to be bound by its provisions. Further, it does not indicate that Meijer considers the policies not to create a contract and, finally, rather than an at-will termination policy, this instrument has consideration running to the employee in the form of an express promise of termination from employment only for just cause. Were this the extent of the provisions of the Meijer handbook, we could easily discern its determinative distinctions from the Heurtebise booklet and find it to be a contract binding on both parties. There is, however, reservation language in the Meijer handbook stating that the existing policies may be "modified or deleted" by the employer. This reservation clause, plaintiff argues, would allow all or part of the contractual provisions to be deleted and means that the instrument here at issue, just as the one in Heurtebise, is no contract at all.

This argument has some allure, but on serious scrutiny, the problem plaintiff points to is illusory in the factual circumstances found here. It must be recalled that this instrument is an agreement to control an ongoing course of conduct between the employer and its employees. By its clear terms, they are both bound by it unless and until the employer chooses to change it. Even then, the employer cannot retroactively escape from its requirements. Any change can only take effect prospectively. See In re Certified Question, 432 Mich. 438, 441, 443 N.W.2d 112 (1989). Accordingly, because the alleged improper acts by the employer at issue here came before any change was made in the agreement by the employer (in fact, as far as we know, even now no changes have been instituted by the employer), both parties are bound. In particular, the parties are bound to utilize the exclusive ADR procedure for handling their contract dispute. While the reservation language in the handbook will allow Meijer, for example, to change its policy of being a just-cause employer to become an at-will employer, the change would be effective only from the time of the implementation of the change (and after reasonable employee notification). Until such a change is made (which might cause the new arrangement to run afoul of the Heurtebise holding), Meijer is bound by the handbook in its dealing with its employees. Indeed, any other conclusion would mean that an employer could never change its employment agreements with its employees. Once a just-cause employer would mean always a just-cause employer. No employer would be likely to choose voluntarily to be so bound, and, thus, plaintiff's position, if adopted, would have the unfortunate and surely undesirable consequence of discouraging the practice of granting employees just-cause termination protection. Moreover, if an employer should cavalierly eliminate provisions that restrict its options in dealing with its employees, arbitrability could be jeopardized under Heurtebise, and valued employees, the retention of whom no doubt prompted the adoption of the just-cause policy in the first place, might choose to leave the employer. Rood v. General Dynamics Corp., 444 Mich. 107, 137-141, 507 N.W.2d 591 (1993). This economic regulation of the employment marketplace will undoubtedly cause an employer to exercise caution before making any change in the employment relationship, just as conditions of the employment market no doubt were factors considered in the granting of just-cause termination status in this case.

Therefore, because the Meijer and Heurtebise handbooks are distinguishable, this plaintiff was bound by the handbook with regard to any contractual claim. The fact that Meijer could later change the agreement does not vitiate the fact that, as things currently stand, these parties are contractually bound. Accordingly, Meijer can, consistent with prior case law, require employees to arbitrate contract disputes regarding adverse employment decisions. See, e.g., Toussaint v. Blue Cross & Blue Shield of Michigan, 408 Mich. 579, 624, 292 N.W.2d 880 (1980). Because plaintiff failed to pursue her breach of contract claim utilizing the required ADR procedure, she is barred from pursuing such a claim in the circuit court. Renny v. Port Huron Hosp., 427 Mich. 415, 429-430, 398 N.W.2d 327 (1986); Zeniuk v. RKA, Inc., 189 Mich.App. 33, 35, 37-38, 472 N.W.2d 23 (1991). Accordingly, we reverse the trial court's order denying defendant's motion for summary disposition of this claim.

II

With regard to plaintiff's gender discrimination claim, we conclude, in light of Heurtebise, that summary disposition was properly denied by the trial court. To this end, we agree with and adopt as our own the reasoning of Justice Cavanagh in parts III through VI of his opinion in Heurtebise, which addressed, albeit in dicta, the issue "whether private employers can require employees, as a condition of employment, to waive prospectively their right to pursue civil rights claims in a judicial forum." ¹ 452 Mich. at 414, 550 N.W.2d 243.

As noted by Justice Cavanagh in Heurtebise, "[u]nlike federal law, Michigan has an unwavering history of faithfully defending an aggrieved individual's right to a judicial forum to remedy unlawful discrimination." 452 Mich. at 414, 550 N.W.2d 243. This unwavering...