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Bailey v. Dover Elevator Co.
Citations: 830 F. Supp. 391; 8 I.E.R. Cas. (BNA) 1022; 1993 U.S. Dist. LEXIS 17529; 1993 WL 338888Docket: Civ. No. 92CV73663DT
Court: District Court, E.D. Michigan; March 28, 1993; Federal District Court
Plaintiff Donald E. Bailey was employed as the district manager at Dover Elevator Company until his resignation on April 10, 1992. He had not received an employee handbook and administered the Dover Field Operating Manual, which did not stipulate that termination could only occur for cause. Bailey believed that employees were typically discharged only for cause, following progressive discipline, and his performance reviews suggested job security and potential advancement within the company. During a conversation with John Apple, the former president of the company, Bailey was encouraged that good performance could lead to promotion. Bailey noted the company's pride in long-term employees, evidenced by a "25 year club." In his resignation letter, he cited personal reasons but alleged he resigned under management pressure related to his order of nitrous oxide for personal use, which he argued was permissible under company policy. Despite the company's claim that his resignation was due to a violation of its drug policy, Bailey maintained that he had an implied-in-fact contract ensuring he could only be terminated for cause, although he acknowledged his employment was otherwise indefinite and lacked a written contract. The Michigan Supreme Court's decision in Rowe v. Montgomery Ward highlighted challenges in recognizing implied contracts, particularly emphasizing that contractual obligations for permanent employment require more than optimistic expressions of job security. The Rowe case noted that specific assurances regarding job security must be backed by substantial contextual elements, unlike Bailey's situation, where no prolonged negotiations or direct inquiries about job security were made. An employer can unilaterally change its discharge policy from one requiring cause to an at-will termination policy, provided reasonable notice is given to employees. The court found that a manual, which clearly stated the at-will policy, informed the plaintiff of her employment status, contradicting her claim of not being an at-will employee at termination. Statements made by the company, such as assurances regarding job security contingent on performance, were deemed expressions of optimism rather than contractual commitments. The establishment of a '25 year club' was interpreted as a goodwill gesture rather than a binding promise. Moreover, a company may implement a progressive disciplinary policy without it constituting a contractual obligation to employees. The court emphasized that such policies serve as operational guidelines rather than enforceable contracts. The defendant did not distribute a detailed policy booklet to the plaintiff, indicating the policy was directed at management rather than employees. Consequently, the court granted the defendant’s motion for summary judgment, noting contradictions in the plaintiff’s claims, including his acknowledgment of instances of immediate discharge.