Cole v. Foxmar Inc.

Citation: 387 F. Supp. 3d 370Docket: Case No. 2:18-cv-00220

Court: District Court, D. Vermont; May 16, 2019; Federal District Court

SummaryOriginalCytator Case TreatmentBackward CitatorAnalysis

EnglishEspañolSimplified EnglishEspañol Fácil

Plaintiff Thomas Cole has filed a lawsuit against Defendant Foxmar, Inc. for damages related to his termination on July 27, 2018. The Complaint includes four counts: wrongful termination under the Vermont Occupational Safety and Health Act (VOSHA), wrongful termination in violation of public policy, breach of contract, and breach of the implied covenant of good faith and fair dealing. Defendant has moved to dismiss these claims for failure to state a valid claim under Fed. R. Civ. P. 12(b)(6), while Plaintiff opposes the dismissal. Additionally, Plaintiff seeks to amend his Complaint to include a claim for wrongful termination under the Vermont Earned Sick Time Act (VESTA) and a claim for promissory estoppel, both of which Defendant argues are futile.

Plaintiff, a resident of Ferrisburgh, Vermont, was employed as a full-time residential counselor at the Northland Job Corps Center (NJCC) in Vergennes, Vermont, which is managed by Defendant. He was responsible for maintaining the cleanliness of NJCC dormitories. On July 23, 2018, students reported to Plaintiff and lead counselor Angela Mobley that their dormitory lacked cleaning sanitizer, which should have been stocked. This was particularly concerning as many students were ill. After addressing this issue with Ms. Mobley, who later provided the necessary sanitizer, Plaintiff voiced concerns to NJCC Center Director Alisha Grangent regarding the risks posed by insufficient cleaning supplies and the refusal to allow sick counselors to leave work. On July 24, 2018, the day following the complaints, Plaintiff left work early due to illness. He was not scheduled to work on the subsequent two days.

On July 25, 2018, the Plaintiff contacted Defendant's Human Resources Department to report health and safety concerns at NJCC but alleges he received no response. On July 27, 2018, he spoke with Human Resources Assistant Mari Trybendis about submitting a written complaint and requested a reassignment from the Department of Independent Living. Trybendis instructed him to email his concerns and reassignment request, which he did, detailing the safety issues and expressing his belief that they posed risks to himself and others. Later that day, he received a voicemail from Human Resources Manager Bernadette Brookes, who wished to discuss his employment. During their meeting, Brookes terminated the Plaintiff's employment, claiming no prior complaints had been received from him. The termination notice cited his failure to report for scheduled shifts on July 23, 24, and 25 as the reason. The Plaintiff contends this reason is false and asserts he was terminated due to his complaints regarding safety violations. The Defendant's Employee Handbook emphasizes the at-will nature of employment, stating that employees can be terminated for any reason without notice and that no statements in the handbook create a contractual obligation regarding employment security.

Completion of an introductory period does not alter an employee's at-will status. Only ETR's President/CEO can authorize agreements that deviate from at-will employment or restrict ETR's ability to adjust employment terms. Statements in the employee handbook or related materials do not modify this at-will policy. Agreements outside of a written contract with the President/CEO, including verbal ones, do not create any implied contracts regarding employment duration or conditions. 

The employee handbook emphasizes the importance of taking sick leave when necessary and outlines consequences for excessive absences or lateness, including potential job loss after three consecutive days of unreported absence. It categorizes offenses into minor, major, and dischargeable, with major offenses including failure to report safety non-compliance and endangering others. The handbook permits management discretion in determining actions for policy violations.

Compliance with safety policies is stressed, with employees expected to report safety threats. The 'HANDBOOK ACKNOWLEDGEMENT' requires employees to recognize that the handbook does not constitute a contract, and employment is at-will, allowing either party to terminate the relationship at any time without notice. Any amendments to the handbook or employment agreements must be made in writing and signed by the employee and the President/CEO. 

Additionally, the document outlines the standard for amending legal pleadings under Fed. R. Civ. P. 15(a)(1), allowing one amendment within 21 days of a responsive pleading or motion, with additional amendments requiring opposing party consent or court approval.

Leave to amend a complaint may be denied if the amendment is deemed futile, particularly when the new pleading fails to present a viable claim for relief. The adequacy of an amended complaint is assessed using the same standards as initial pleadings. For a complaint to survive a motion to dismiss under Fed. R. Civ. P. 12(b)(6), it must include sufficient factual allegations to establish a plausible claim. A claim is considered plausible when the factual content enables the court to reasonably infer the defendant's liability. While the court must accept factual allegations as true, it is not obligated to accept legal conclusions disguised as factual statements.

In this context, the court will evaluate the merits of the motion to dismiss alongside the plaintiff's motions to amend. The plaintiff’s First Amended Complaint (FAC) alleges wrongful termination for reporting a violation of 21 V.S.A. 483(g), which prohibits employers from requiring employees to find replacements for certain absences, including health care-related ones. VESTA incorporates a retaliation provision from 21 V.S.A. 397, which protects employees from discharge or retaliation for reporting violations or cooperating in investigations.

The defendant argues that the plaintiff has not sufficiently alleged a violation of 21 V.S.A. 483(g), specifically claiming a lack of evidence supporting the assertion that another counselor was prevented from leaving due to illness. The plaintiff claims to have overheard Ms. Mobley telling a sick counselor that she could leave only if she found a replacement and communicated his concerns about this to his supervisors. Accepting these facts as true, the court finds that the plaintiff has sufficiently alleged that Ms. Mobley violated 21 V.S.A. 483(g).

The defendant also contends that the plaintiff has not adequately pleaded a retaliation claim, arguing that he failed to follow necessary procedures under 21 V.S.A. 483(n) and Department of Labor rules for lodging complaints. However, the plaintiff asserts that his oral and written complaints to supervisors constitute protected activity under 21 V.S.A. 397(a)(1), although the definitions of "lodging a complaint" under this statute remain undefined by VESTA or Vermont courts.

The Vermont Fair Employment Practices Act (VFEPA) prohibits employers, employment agencies, and labor organizations from discharging or discriminating against employees for lodging complaints or participating in investigations of unlawful acts. The Vermont Supreme Court has interpreted this to include oral complaints to supervisors, as established in Beckmann v. Edson Hill Manor, Inc., where an employee's verbal assertion of sexual harassment was deemed protected activity under VFEPA. The U.S. Supreme Court has similarly ruled that oral complaints qualify for protection under the Fair Labor Standards Act if the employer is given fair notice of the grievance. The court predicts that Vermont will extend protections to verbal complaints under VFEPA, provided the employer is aware of the complaint's nature. The plaintiff's notification of a colleague's failure to manage work absences constituted a plausible complaint under VFEPA, justifying the granting of his motion to amend his complaint to include a retaliation claim.

Regarding the plaintiff's claim of promissory estoppel, he alleges that the employee handbook promised not to retaliate against him for reporting safety violations, and he relied on this promise, leading to his termination. The defendant contends that the handbook does not contain such a promise and that any language therein cannot be interpreted as a guarantee of continued employment. Under Vermont law, an at-will employee may still claim wrongful termination through promissory estoppel if they establish (1) a promise that the promisor expects the promisee to act on, (2) that this promise induced significant action or forbearance, and (3) that enforcing the promise is necessary to prevent injustice. The first two elements are factual determinations, while the necessity to enforce the promise is a legal question. The Vermont Supreme Court's approach to promissory estoppel follows the Restatement (Second) of Contracts, which broadly defines a "promise" as encompassing expectations arising from assurances, including moral and legal obligations.

To establish a claim of promissory estoppel, a promise must be specific and definite. The employee handbook encourages employees to report compliance issues and warns that failing to do so is a "Major Offense," suggesting that employees who report safety concerns will not face termination. The defendant argues that the plaintiff has not shown that enforcing the promise is necessary to avoid injustice. Factors to consider include the availability of other remedies, the substantial nature of the employee's actions, the corroboration of evidence regarding the promise, the reasonableness of the actions, and the foreseeability of those actions by the promisor. At the pleading stage, the plaintiff sufficiently alleges reliance on company policies when reporting health and safety concerns that led to his termination, thus the motion to amend the complaint to include a promissory estoppel claim is granted.

Regarding the claim under the Vermont Occupational Safety and Health Act (VOSHA), the defendant asserts that the plaintiff's complaints about sick leave policies and lack of sanitizer do not constitute workplace safety violations. The plaintiff argues he reasonably believed VOSHA violations existed and that his termination was retaliatory for reporting them. VOSHA prohibits discrimination against employees for filing complaints or exercising rights under the statute, offering a private right of action, unlike OSHA. To plead a retaliation claim under VOSHA, the plaintiff must demonstrate that he engaged in protected activity, the defendant was aware of it, he suffered adverse employment action, and there is a causal link between the two. The plaintiff contends he reported VOSHA violations related to ensuring safe working conditions and that his allegations support the required causal connection.

The Vermont Supreme Court has not yet determined whether a good faith, reasonable belief of a violation is sufficient for a VOSHA (Vermont Occupational Safety and Health Act) retaliation claim; however, similar anti-retaliation laws, like the Americans with Disabilities Act, support this view. The plaintiff contends he reasonably believed that inadequate sanitizer and preventing a sick employee from leaving constituted unsafe working conditions, and he claims he was terminated in retaliation for reporting these issues. The court finds these allegations adequate to support a VOSHA retaliation claim, denying the defendant's motion to dismiss.

Regarding the wrongful termination claim based on public policy, the plaintiff argues his termination violated public policies aimed at protecting employee and student health. He cites a specific Vermont statute prohibiting employers from allowing sick individuals to work when it could harm public health. The defendant argues this claim is duplicative of the VOSHA retaliation claim and therefore preempted. The court agrees, stating that when a statute provides a remedy unknown at common law, it preempts any common law claims based on the same facts and legal theories. Thus, the defendant's motion to dismiss this wrongful termination claim is granted.

Concerning the breach of contract claim, the plaintiff alleges an implied employment contract based on the employee Handbook, claiming he was wrongfully terminated for job abandonment and for reporting safety issues as required by the Handbook. The defendant seeks dismissal, arguing this claim is also preempted by VOSHA and that no implied contract existed. The court agrees that the claim related to reporting safety issues is preempted by VOSHA. Additionally, under Vermont law, employees hired indefinitely are presumed at-will, meaning they can be terminated at any time unless there is a compelling public policy against the reason for termination.

Employment for an indefinite term is generally assumed to be an 'at-will' agreement, but if an employer creates a perception of job security, it cannot arbitrarily disregard its commitments. An employer can unilaterally modify at-will employment through written policies or practices, potentially binding itself to terminate only for cause and to follow specific procedures that must be clear, communicated to employees, and indicative of the employer's intent. The enforceability of these procedures is critical, and the interpretation of unambiguous writings falls within the court's purview, while ambiguous writings may be interpreted by a jury.

Under Vermont law, disclaimers stating employment is at-will are not definitive and cannot negate implied contracts or procedural protections in an employee handbook. Disclaimers must be considered alongside other handbook provisions. The Handbook outlines an accountability schedule for various offenses but retains management's discretion to take action for any policy violation, indicating that employees are at-will unless bound by a specific contract. Although the Handbook's language suggests a progressive discipline system, it does not constitute an enforceable promise of specific treatment, leading to the conclusion that no implied contract of employment exists. Consequently, the defendant's motion to dismiss the plaintiff's breach of contract claim is granted. Additionally, the plaintiff alleges a breach of the implied covenant of good faith and fair dealing for termination after reporting safety violations.

Defendant argues for the dismissal of Plaintiff's claim for breach of the implied covenant of good faith and fair dealing, asserting that no employment contract exists and that the claim is preempted by the Vermont Occupational Safety and Health Act (VOSHA). The implied covenant is recognized within contractual relationships but requires an underlying contract to establish a breach. Vermont case law indicates that such a covenant cannot be invoked in unmodified at-will employment relationships, as it conflicts with the employment-at-will doctrine and implies judicial interference. Consequently, since Plaintiff's employment was at-will, the motion to dismiss the claim for breach of the implied covenant is granted. Additionally, the claim is based on the same actions as the breach of contract claim and is thus preempted by the VOSHA retaliation claim. The court concludes that a separate cause of action for breach of the implied covenant cannot coexist with a breach of contract claim based on the same conduct. The court grants Plaintiff's motions to amend the Complaint to include claims for retaliation under VESTA and for promissory estoppel. However, it grants Defendant's motion to dismiss claims related to breach of contract, breach of the implied covenant, and wrongful termination while denying the motion regarding the VOSHA retaliation claim. Plaintiff must file a Third Amended Complaint within twenty days reflecting these rulings. The court also notes that the terms of the Employee Handbook, referenced in the motion to dismiss, are relevant to the claims and can be considered in this context.

Courts may consider written instruments attached to a complaint, documents incorporated by reference, and documents integral to the complaint when evaluating a Rule 12(b)(6) motion. According to 21 V.S.A. 483(n), the Commissioner is tasked with enforcing the relevant subchapter per the procedures in section 342a, which outlines the filing of complaints regarding unpaid wages. The Vermont Earned Sick Time Rules allow employees to file complaints as prescribed by the Commissioner, yet neither VESTA nor these rules define how a plaintiff must lodge a complaint for a retaliation claim under 21 V.S.A. 397. The Vermont Supreme Court clarified in Tour Costa Rica that "enforcement of the promise" does not require literal enforcement, as jury-awarded damages can suffice. The defendant does not claim that the plaintiff's promissory estoppel claim is preempted but contests it on other grounds. The plaintiff argues that his termination violated several public policies, including the Vermont Rental Housing Health Code and the Vermont Earned Sick Time Act; however, these claims are not currently before the court. Notably, a party cannot amend a complaint through opposition to a dispositive motion, and new facts or theories cannot be introduced for the first time in such opposition.