Van Heest v. McNeilab, Inc.

• Decision Date: 18 December 1985
• Docket Number: Civ. A. No. 83-336 MMS.
• Citation: 624 F. Supp. 891
• Parties: Jeanne VAN HEEST, Plaintiff, v. McNEILAB, INC., trading as First State Chemical Co., Inc., Defendant.
• Court: U.S. District Court — District of Delaware

624 F. Supp. 891

Jeanne VAN HEEST, Plaintiff, v. McNEILAB, INC., trading as First State Chemical Co., Inc., Defendant.

Civ. A. No. 83-336 MMS.

United States District Court, D. Delaware.

December 18, 1985.

Sheldon N. Sandler, Young, Conaway, Stargatt & Taylor, Wilmington, Del., for plaintiff.

Robert J. Katzenstein, Lassen, Smith, Katzenstein & Furlow, Wilmington, Del., of counsel: Joseph M. David, Jr., James E. Farrell, Jr., and Francis X. O'Brien, Jr., Curran, Mylotte, David & Fitzpatrick, Philadelphia, Pa., for defendant.

OPINION

MURRAY M. SCHWARTZ, Chief Judge.

Plaintiff Jeanne M. Van Heest brought this sex-discrimination action against defendant McNeilab, Inc., trading as First State Chemical Co., Inc. ("McNeilab"), to recover back wages and other damages. Plaintiff's claims are based on the Equal Pay Act of 1963, 29 U.S.C. § 206(d) & § 206 note, and Title VII of the Civil Rights Act of 1964, codified as amended at 42 U.S.C. § 2000e et seq. In essence, plaintiff claims that during the period from August 22, 1980, to October 31, 1982, when she worked for McNeilab, defendant discriminated against her on the basis of sex by paying her lower wages than comparable male employees received. The primary evidence advanced to support this contention is that the two males allegedly hired to replace her were paid a combined total of over three times her salary.

Presently before the Court is defendant's motion for summary judgment. For the reasons that follow, defendant's motion will be granted in part and denied in part.

I. Facts

The relevant facts are stated in the light most favorable to plaintiff, the party opposing the summary judgment motion. In 1977, plaintiff began working at First State Chemical Company ("FSCC"), a small, privately owned chemical-manufacturing company. Plaintiff and her husband were the only employees of FSCC. Plaintiff's duties included purchasing, payroll, bookkeeping, and secretarial tasks. Her purchasing duties included buying office supplies, capital equipment for production, and raw materials. Plaintiff's Deposition ("Dep."), Docket Item ("Dkt.") 17, at 10-11. Plaintiff received no salary during her first year at FSCC, but later received a salary of $18,000 per year. Id. at 12.

In August, 1980, FSCC was acquired by Johnson & Johnson and merged into McNeilab, a Johnson & Johnson subsidiary. At that time, FSCC had twelve employees. On August 11, 1980, plaintiff began working for McNeilab pursuant to a written three-year employment agreement, at a starting salary of $18,000 per year. The agreement provided that plaintiff "shall be entitled to ... periodic salary review ... in accordance with personnel practices established by the Company for employees with comparable experience, responsibilities and salary...." App. To Defendant's Brief In Support Of Its Motion For Summary Judgment, Dkt. 63A, at 15-16. Plaintiff continued to perform the same duties she had prior to the acquisition, although the effect of the acquisition was to expand those duties. Plaintiff's Dep., Dkt. 17, at 31-33.

Plaintiff was not given a formal job classification at that time. When plaintiff was later classified, in the latter half of 1981, her classification was based on her salary, instead of the usual Johnson & Johnson practice of classifying employees according to their duties. See Plaintiff's Dep., Dkt. 72, at 13-14; Dkt. 17, at 30-31; Dkt. 58, at 3-4; Beebe Dep., Dkt. 71, at 14. As a result, plaintiff was classified as an Office Manager at Level 9, a level appropriate for entry-level personnel in accounting or computer science, or an entry-level research assistant or computer programmer. Beebe Dep., Dkt. 71, at 28-29.

From the beginning of her employment at McNeilab plaintiff performed a variety of duties: payroll, accounting, bookkeeping, and general secretarial duties. Dkt. 42, at 1; Hauber Dep., Dkt. 33, at 11-12. In addition, plaintiff performed many of the functions of a purchasing agent, including purchasing capital equipment, raw materials, and office supplies. See Dkt. 42, at 2-4. In 1981, the company removed plaintiff from her accounting and bookkeeping functions because as part of those functions she reported directly to her husband, the plant manager. Stratmeyer Dep., Dkt. 16, at 12-13. The company replaced her with Al Cox, a transferred accountant from McNeilab, who was classified at a Level 13 and received a much larger salary than plaintiff had. Plaintiff's Dep., Dkt. 72, at 16-18.

In October, 1981, plaintiff was asked if she would assume the position of a Controlled Substance Officer ("CSO"), a new position that involved monitoring controlled substances. Hauber Dep., Dkt. 33, at 18-19. Company personnel prepared a job description of the position and agreed that the position should be classified at a Level 13. Id. at 15-16. Louise Beebe, a compensation specialist at McNeil Pharmaceuticals who was consulted on this matter, recommended that plaintiff immediately start receiving the minimum annual salary for a Level 13, $24,780. Beebe Dep., Dkt. 71, at 31; Hauber Dep., Dkt. 33, at 21. The Director of Operations at McNeil Pharmaceuticals rejected this recommendation and set plaintiff's salary at $21,500, in purported reliance on a Johnson & Johnson policy prohibiting salary increases greater than twenty percent over the former salary. Hauber Dep., Dkt. 33, at 17-18; Stratmeyer Dep., Dkt. 16, at 33-34. That policy, however, was not binding on McNeilab management. Beebe Dep., Dkt. 71, at 26.

Plaintiff's salary remained the same until she was terminated in October, 1982, despite 1) a company policy to increase to the minimum salary level for that position any salaries below that minimum as soon as possible, and 2) an increase of the Level 13 minimum to $27,258 on January 1, 1982. See Hauber Dep., Dkt. 33, at 23, and Ex. 1 thereto; Beebe Dep., Dkt. 71, Plaintiff's Ex. 2, at 4-5. In addition, plaintiff did not receive the same merit bonuses or stock options that similarly situated males in the company received. Plaintiff's Dep., Dkt. 72, at 42-47.

Plaintiff worked as a CSO until her termination on October 31, 1982, and continued to perform the purchasing duties she had as an Office Manager. Hauber Dep., Dkt. 33, at 19. Plaintiff developed the CSO position during her tenure at McNeilab. Plaintiff's Dep., Dkt. 17, at 50. In July, 1982, plaintiff was told by her husband, the plant manager, that she would have to leave the company because of its anti-nepotism policy. Id. at 94. Plaintiff agreed to leave as soon as her replacements were hired. After discussion, the company decided to hire two persons to replace plaintiff: one Purchasing Manager and one CSO. Hauber Dep., Dkt. 33, at 58-60. A top company manager stated at the time that a male should be hired as CSO because the CSO would have to deal with foreign countries whose businessmen would communicate better with males. Id. at 56-57.

The persons who took over plaintiff's functions were hired in October, 1982, and classified at Level 13. The new Purchasing Manager, Blaine Tilghman, started at a salary of $32,700, which equaled his previous salary. Tilghman Dep., Dkt. 34, at 4; App., Dkt. 63A, at 24. The new CSO, David Connor, started at a salary of $37,500, which approximately equaled his previous salary. Id. at 54. Plaintiff worked with Connor and Tilghman for about two weeks before she left the company, and she helped train them. Plaintiff's Dep., Dkt. 17, at 52, 57-58; Connor Dep., Dkt. 35, at 6. Plaintiff left the company on October 31, 1982.

After leaving, plaintiff was paid in two lump sums, at an annual rate of $21,500, for the remainder of her three-year contract term, which expired in September, 1983. Plaintiff's Dep., Dkt. 17, at 24. Although plaintiff discussed the possibility of executing a release when she was leaving the company, she never agreed to a release and did not execute the release she received from the company in January, 1983, after she had received the balance due her under her three-year contract. Id. at 96-99; Hauber Dep., Dkt. 33, at 45.

On May 20, 1983, plaintiff filed a written charge against FSCC with the Anti-Discrimination Section of the Delaware Department of Labor. Plaintiff brought this action against FSCC on June 1, 1983. Amended Complaint, Dkt. 25, Ex. A. Thereafter the Equal Employment Opportunity Commission sent a right-to-sue letter to plaintiff on January 13, 1984.

II. Defendant's Motion For Summary Judgment

After the completion of discovery, defendant filed a motion for summary judgment, alleging it was entitled to summary judgment as a matter of law on a variety of legal theories. Specifically, defendant contends: 1) plaintiff is estopped from pursuing her sex-discrimination action because she entered into an employment agreement with defendant which defendant did not breach; 2) plaintiff released defendant from liability for any claim she had against defendant; 3) plaintiff's Equal Pay Act and Title VII claims are barred by the applicable statutes of limitations; 4) defendant is entitled to summary judgment on the Equal Pay Act claim because plaintiff did not perform work substantially equivalent to her male successors, and because her wages were lower for reasons other than sex; and 5) defendant is entitled to summary judgment on the Title VII claim because there is no evidence that defendant discriminated against plaintiff on the basis of her sex. These contentions will be considered seriatim.

A. Estoppel

Defendant's first contention is that plaintiff is estopped from asserting her claims because she entered into an employment agreement with defendant, and defendant did not breach that agreement. Defendant cites no cases in support of its argument, nor could it. Plaintiff is not alleging breach of contract; she contends that defendant discriminated against her on the basis of her sex, in violation of her federal statutory rights. A party does not waive her right to be free from sex...