Opinion
No. 39822-2-II.
January 21, 2011. UNPUBLISHED OPINION
Appeal from a judgment of the Superior Court for Thurston County, No. 08-2-01584-7, Wm. Thomas McPhee, J., entered September 4, 2009.
Affirmed by unpublished opinion per Bridgewater, J. Pro Tem., concurred in by Penoyar, C.J., and Quinn-Brintnall, J.
Roger Cox appeals the summary judgment dismissal of his lawsuit for wrongful discharge against his former employer, Boeing. We hold that Boeing's employee handbook did not entitle him to specific treatment in specific situations, i.e., alternative dispute resolution. We affirm.
FACTS
Because we review summary judgment granted in Boeing's favor, we consider the facts in the light most favorable to Cox. Wilson Court Ltd. P'ship v. Tony Maroni's Inc., 134 Wn.2d 692, 698, 952 P.2d 590 (1998). There is no dispute as to the material facts expressed below.
Cox was employed at Boeing from August 2, 1987, until he was discharged on February 14, 2007. During his last years at Boeing, Cox worked as a modeler, a position that involves creating graphical presentations of complex procedures and concepts.
In June 2005, Cox joined Boeing's Global Trade Controls (GTC) group, an internal entity responsible for ensuring that Boeing complies with the International Traffic in Arms Regulation (ITAR). Cox's primary responsibility within GTC was to create a model that the GTC could use internally to assist GTC personnel in better identifying and communicating ITAR compliance requirements. Instead of focusing on his assigned tasks, however, Cox repeatedly pursued unauthorized projects outside of his assigned job duties, even when directly instructed not to do so.
On at least three separate occasions, Cox contacted outside vendors about purchasing software, even though he had no purchasing authority. After each prohibited contact, Cox was told to stop acting unilaterally and to follow management direction. As a result of his failure to stop contacting outside vendors, Cox was issued a "Corrective Action Memo" (CAM) on January 6, 2006. Clerk's Papers (CP) at 158. The CAM stated:
During the month of December, 2005, you failed to follow management direction. Specifically, you contacted a Boeing vendor after being directed, both verbally and by e-mail, not to contact any vendors without prior approval from your manager. You also communicated with a contract labor employee about a situation after you were verbally directed by your manager not to discuss the situation with that employee. Your behavior is inappropriate.
CP at 158.
Cox also repeatedly shared sensitive information with unauthorized persons, disregarding clear direction otherwise. On March 1, 2006, Cox was directed to cease sharing such information. Six days later, Cox e-mailed three Boeing employees to say that he was "working on alternative ways to share" the information despite "constraints." On March 8, Cox e-mailed a Boeing employee and told him that he would "bring . . . a [compact disc] that has the [information] on it. Then those who want copies can make them." CP at 86. Cox was again directed to cease sharing such information, but he continued to defy those directives.
In response to Cox's repeated dissemination of sensitive information, on March 30, Cox was issued a second CAM:
Roger, you continue to fail to follow management direction. You were directed both verbally and by e-mail not to engage in specific activities without management approval. You contacted a co-worker for procurement status and you contacted internal customers and employees regarding the UML model without management approval. This behavior is unacceptable and will not be tolerated.
CP at 166. This CAM also suspended him for five days without pay.
Both the January 6 and March 30 CAMs advised Cox that he was "expected to comply with management's direction, while on company time or property" and that "[f]urther violations of this nature[] will result in a review for further employee corrective action, up to and including discharge from the Boeing Company." CP at 158, 166. Cox understood the content of the CAMs and that he could be terminated if he failed to comply with management's direction.
Cox appealed his March 30 CAM under Boeing's alternative dispute resolution (ADR) process. Boeing's ADR process, outlined in Boeing PRO-780, is an internal program under which nonunion employees may implement to resolve certain employment related disputes. On the first page, PRO-780 states:
This procedure does not constitute a contract or contractual obligation, and the Company reserves the right, in its sole discretion, to amend, modify, or discontinue its use without prior notice, notwithstanding any person's acts, omissions, or statements to the contrary.
CP at 176. Cox admitted that while he was a Boeing employee, he had read and understood this disclaimer. PRO-780 also says that "ADR does not alter the status of any employee who is employed `at-will' and is not intended to grant any additional rights to continued employment with the Company." CP at 179.
Cox answered the following to these deposition questions:
Q: And so you read the part that says, "This process instruction does not constitute a contract or contractual obligation, and the Company reserves the right, in its sole discretion, to amend, modify, or discontinue its use without prior notice notwithstanding any person's acts, omissions or statements to the contrary," right?
A: I'm very familiar with this, the statement.
Q: You've read that and you understood it, correct?
A: Understand it very clearly.
Q: Okay. And you understood it very clearly in January of 2006, right?
A: That's very true.
CP at 210-11.
Around the time Cox was issued his March 30 CAM, Boeing began investigating Cox's computer usage. By October 23, 2006, the investigation revealed that Cox was continuing to violate clear management directives. He had again exported sensitive information on three separate occasions and he had deleted certain files on his computer after management directed him not to delete anything.
Before Cox underwent PRO-780's third step, peer panel review, Boeing suspended him pending an internal disciplinary investigation. Boeing completed the investigation and discharged Cox on February 14, 2007.
Cox sued in July 2008, alleging that Boeing failed to follow employee corrective action procedures when it discharged him. Boeing moved for summary judgment, arguing that its handbook procedures were not promises that entitled Cox to specific treatment in specific situations. Cox argued that Boeing handbook policies PRO-780, PRO-1909, and BPI-2616 provided him specific treatment in specific situations.
The trial court granted Boeing summary judgment. The trial court ruled that Cox had failed to present evidence that Boeing made promises of specific treatment or that he justifiably relied on the three policies he identified as allegedly creating such promises. The trial court also ruled that Cox had failed to present evidence that Boeing breached PRO-1909 or BPI-2616. As to PRO-780, the trial court ruled that, although issues of material fact may exist regarding whether Boeing fully complied with PRO-780, Cox's failure to produce evidence of a specific promise or justifiable reliance rendered this point immaterial.
ANALYSIS
The question before us is whether the trial court properly granted Boeing summary judgment. We review an order granting summary judgment de novo and engage in the same inquiry as the trial court. Weden v. San Juan Cnty., 135 Wn.2d 678, 689, 958 P.2d 273 (1998). Summary judgment is proper "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." CR 56(c). As we have stated, there are no disputed facts here.
Cox suggests that summary judgment is per se improper for handbook claims, which is incorrect. Washington courts regularly resolve employee handbook cases on summary judgment. E.g., Trimble v. Wash. State Univ., 140 Wn.2d 88, 94-95, 993 P.2d 259 (2000) (employee handbook language was discretionary and not a promise for specific treatment as a matter of law); Birge v. Fred Meyer, Inc., 73 Wn. App. 895, 900, 872 P.2d 49 (employee handbook did not create promise for specific treatment in situations outside defined reasons for immediate discharge as a matter of law), review denied, 124 Wn.2d 1020 (1994); see also Stewart v. Chevron Chem. Co., 111 Wn.2d 609, 613-14, 762 P.2d 1143 (1988) (employer's layoff policy was discretionary and did not create a binding promise as a matter of law). Whether an employee handbook contains a promise of specific treatment in specific situations may present questions of fact. See Burnside v. Simpson Paper Co., 123 Wn.2d 93, 104-05, 864 P.2d 937 (1994). Only if reasonable minds could not differ in deciding this issue should a trial court decide it as a matter of law. Burnside, 123 Wn.2d at 105.
Generally, an employer or employee may terminate employment of indefinite duration at will, with or without cause. Burnside, 123 Wn.2d at 104 (citing Thompson v. St. Regis Paper Co., 102 Wn.2d 219, 223, 685 P.2d 1081 (1984)). The employer, however, may modify the terminable at will relationship with an employee handbook that contains promises of specific treatment in specific situations and that induces the employee to rely thereon. Gaglidari v. Denny's Rest., Inc., 117 Wn.2d 426, 433, 815 P.2d 1362 (1991); Thompson, 102 Wn.2d at 229-30. "[A]bsent specific contractual agreement to the contrary, . . . the employer's act in issuing an employee policy manual can lead to obligations that govern the employment relationship." Thompson, 102 Wn.2d at 229. To provide such specific obligations, the policy handbook must be specific. Trimble, 140 Wn.2d at 93.
The employer can also modify terminable at will employment under a traditional theory of implied contracts, where the court looks for the existence of offer, acceptance, and consideration. Thompson, 102 Wn.2d at 228; e.g., Gaglidari 117 Wn.2d at 433 (handbook formed a contract when employer gave a manual and explained its provisions, employee accepted by signing and agreeing to abide, and employee gave consideration by actually working for employer). Cox does not claim this occurred here.
In seeking to enforce a handbook policy as an obligation governing the employment relationship, the employee must prove that (1) the statements in the employee handbook amounts to a promise of specific treatment in specific situations, (2) the employee justifiably relied on the promise, and (3) the employer breached the promise of specific treatment. Thompson, 102 Wn.2d at 233.
Boeing argues that each policy that Cox cites contains a valid and effective disclaimer that precluded an employment contract, in accord with Cox being an at will employee. The disclaimer, found on the first page of each procedure, states that the procedure or process instruction
does not constitute a contract or contractual obligation, and the Company reserves the right, in its sole discretion, to amend, modify, or discontinue its use without prior notice, notwithstanding any person's acts, omissions, or statements to the contrary.
CP at 105, 125, 176.
Employers can disclaim what otherwise might appear to be enforceable promises in an employee handbook. Swanson v. Liquid Air Corp., 118 Wn.2d 512, 526, 826 P.2d 664 (1992); Thompson, 102 Wn.2d at 230. Such a disclaimer must state in a conspicuous manner that nothing contained in the handbook is part of the employment relationship and is simply a statement of company policy. Thompson, 102 Wn.2d at 230.
Boeing maintains that the effect of the disclaimer cited above is a question of law. The effect of a disclaimer may present a question of law or one of fact. Swanson, 118 Wn.2d at 528. In Swanson, the plaintiff alleged that he never read the disclaimer, which appeared on of a benefits manual mailed to him several months after he began employment. Swanson, 118 Wn.2d at 515, 529. The plaintiff sought to rely on a later issued memorandum of working conditions, which stated that the company would provide employees with at least one warning before discharge. Swanson, 118 Wn.2d at 516, 519. The Swanson court held that a question of fact existed about whether the employee had received reasonable notice of the disclaimer. Swanson, 118 Wn.2d at 529.
In contrast to Swanson, the uncontroverted evidence here is that Cox knew about and understood the disclaimer before being discharged. The disclaimer appeared on the first page of each policy that Cox now claims became enforceable promises. The disclaimer clearly states that Boeing is not adding to the employment relationship and that Boeing has sole discretion to amend, modify, or discontinue the policy or process without prior notice. "There can be no promise where the speaker reserves the right to alter, and even deviate from, the policies being stated." Burnside, 123 Wn.2d at 111 (citing Shankle v. DRG Fin. Corp., 729 F. Supp. 122, 124 (D.D.C. 1989)). Under these circumstances, reasonable minds cannot differ. E.g., Payne v. Sunnyside Cmty. Hosp., 78 Wn. App. 34, 40, 894 P.2d 1379 (disclaimer communicated to employee as a matter of law), review denied, 128 Wn.2d 1002 (1995).
Nevertheless, even if an employer adequately communicated a disclaimer, inconsistent employer representations and practices may negate the disclaimer, creating issues of material fact about what the parties intended the terms of the employment relationship to be. Swanson, 118 Wn.2d 531-34. In Swanson, the employer wrote the memorandum of working conditions because its employees were not in a union but it still wanted to attract talent. Swanson, 118 Wn.2d at 516. The Swanson court held that because there was evidence that the employer sought to appease its employees and deter unionization through working condition promises, the employer could not then ignore the promises as illusory by pointing to the disclaimer. 118 Wn.2d at 525, 534-36.
The crucial question is whether Cox had a reasonable expectation that Boeing would follow PRO-790, based on the policy language and the pattern of practice in the workplace. Payne, 78 Wn. App. at 42. Cox does not offer any evidence of typical workplace practice but appears to argue (he does not provide citation) that the following PRO-790 language contained a promise of specific treatment: "The decision of a peer panel is binding upon the Company. It is also binding on the employee when the employee accepts the decision of the peer panel." CP at 181. This language clearly states that a peer panel review decision, once rendered, binds Boeing, but it does not offer any guidance about whether Boeing promised Cox a peer panel review in the first instance.
Cox, citing Gaglidari, argues that because he initiated ADR under the PRO-780 policy, Boeing could not end the process, which includes four steps, unless Boeing provided him sufficient notice of a change. Gaglidari, 117 Wn.2d at 433. But in Gaglidari, the handbook at bar formed a contract between the employer and employee. Gaglidari, 117 Wn.2d at 433. Cox does not argue that Boeing's processes and policies here created a contract but rather, he argues that the handbook promised him specific treatment. Thus, the question here still remains whether Boeing promised anything to Cox to begin with; if not, the Gaglidari decision would not require Boeing to give Cox reasonable notice.
Taken in the light most favorable to Cox, he has not presented evidence that Boeing supplemented, modified, or contradicted the PRO-780 disclaimer through inconsistent representations or practices. He incorrectly argues that Boeing represented that he could complete the PRO-780 process when it allowed him to initiate the policy. Surely any nonunion employee could initiate the PRO-780 policy, and Boeing would not use that as a reason for retaliatory action. But allowing the process to begin does not, alone, amount to a representation or practice that evidences Boeing's intent to contradict the disclaimer. On the contrary, in addition to the general disclaimer, PRO-780 clearly states that the "ADR does not alter the status of any employee who is employed `at-will' and is not intended to grant any additional rights to continued employment with the Company." CP at 179. Other than Boeing allowing him to initiate PRO-780, which is not alone evidence of a promise, Cox has not presented any other evidence that Boeing acted in a manner evidencing a promise that he could complete the PRO-780 before being discharged. Cf., Payne, 78 Wn. App. at 42-43 (effect of disclaimers was a question of fact where employee presented evidence that management needed to follow a progressive discipline procedure and evidence of specific instance where management used that procedure on another employee).
Yet, even with the disclaimer aside, Cox cannot prevail under his PRO-780 theory because he cannot show that PRO-780 immunized him from consequences arising from further misconduct. He has presented no evidence that Boeing intended "to surrender its power to determine whether an employee's misconduct warranted his or her termination" when it established guidelines in the employee handbook. Bulman v. Safeway, Inc., 144 Wn.2d 335, 353, 27 P.3d 1172 (2001). He sought review under PRO-780 after receiving his second CAM, but he continued to violate his supervisor's directives. This continuation of activities included exporting sensitive information to unauthorized people and deleting computer records that may have corroborated his continuation of prohibited activities. At oral argument, Cox's counsel acknowledged that destroying computer records was a valid reason for discharge and that ADR did not apply to that activity. Thus, the appeal concerned five days of suspension and, at best, the months between October 2006 (when report from examining his computer resulted in another suspension) and February 2007 (his discharge). Additionally, even though we explain that Cox had no basis for his claim for ADR treatment, because of his later acts of insubordination, i.e., exporting sensitive information and deleting computer records, whether Boeing had to follow through with ADR is mooted.
As a terminable at will employee, initiating the PRO-780 policy did not preclude Boeing from discharging Cox for further insubordination and from canceling an in-progress ADR process that was brought to resolve a previous dispute with management. See Clark v. Sears Roebuck Co., 110 Wn. App. 825, 831, 41 P.3d 1230 (2002) (progressive discipline procedure applies only if employee remains employed). Cox has not pointed to any language in the employee handbook that supports his theory that initiating ADR under PRO-780 somehow shields him from discharge, and he has conceded the propriety of his discharge.
Cox also has not presented any evidence that Boeing represented or had practices that supplemented, modified, or contradicted the BPI-2616 or PRO-1909 disclaimers, which are identical to the PRO-790 disclaimer. Cox does not argue, let alone suggest, that Boeing acted in a way to trump the disclaimers. Instead, without citation, Cox argues that "Pro 1909 [sic] states that specific steps are to be taken before an employee is disciplined" and that Boeing skipped those steps. Br. of Appellant at 11. He is misguided. PRO-1909 states that immediate discharge "may be appropriate" for serious offenses and that progressive corrective action "normally" governs repeated similar offenses. CP at 126-27. It also states that "[i]t is not always necessary for the corrective action process to commence with a verbal warning or include every step." CP at 128. Similarly, in contrast to Cox's claim that BPI-2616 requires investigations to be concluded as promptly as practicable, BPI-2616 actually states that "[i]nvestigations should be concluded as promptly as practicable." CP at 107 (emphasis added). "A supposed promise may be illusory if it is so indefinite it cannot be enforced or if its performance is optional or discretionary on the part of the promisor." Stewart, 111 Wn.2d at 613.
Notably, Cox concedes in his brief on this appeal that "[t]here is no evidence that the policies at issue in this case were altered, modified, or amended." Br. of Appellant at 12. The facts here can only lead to the conclusion that the parties intended BPI-2616, PRO-1909, and PRO-780 to guide the employment relationship, not create a binding process through a set of promises, as a matter of law. Without a promise that modified Cox's at will employment status, none of his theories can succeed. Accordingly, we affirm the trial court's summary dismissal of Cox's claim.
A majority of the panel having determined that this opinion will not be printed in the Washington Appellate Reports, but will be filed for public record pursuant to RCW 2.06.040, it is so ordered.
Quinn-Brintnall, J.
Penoyar, C.J., concur.