FILED

September 1, 1999

Cecil Crowson, Jr.

Appellate Court Clerk

IN THE COURT OF APPEALS OF TENNESSEE

AT NASHVILLE

MICHAEL KING, ) 

)

Plaintiff/Appellant, ) Maury Circuit No. 6503

)

VS. ) Appeal No. 01A01-9711-CV-00624

)

TFE, INC., )

)

Defendant/Appellee. )

APPEAL FROM THE CIRCUIT COURT OF MAURY COUNTY

AT COLUMBIA, TENNESSEE

THE HONORABLE JIM T. HAMILTON, JUDGE

JOHN W. PALMER

THE PALMER LAW FIRM

Dyersburg, Tennessee

Attorney for Appellant

KIM B. KETTERING

HARDIN, PARKES & KETTERING, PLLC

Columbia, Tennessee

Attorney for Appellee

AFFIRMED

ALAN E. HIGHERS, J.

CONCUR:

W. FRANK CRAWFORD, P.J., W.S.

HOLLY KIRBY LILLARD, J.

In this action filed against TFE, Inc. (hereafter “TFE”), Michael King appeals the trial
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court’s grant of summary judgment to TFE as related to King’s claims for breach of an

alleged employment contract. The trial court granted TFE’s motion for summary judgment

based on the court’s conclusion that an employee handbook distributed by TFE did not

constitute an employment contract. For the reasons hereafter stated, we affirm the trial

court’s grant of summary judgment.

FACTS AND PROCEDURAL HISTORY

King began working for TFE as a truck driver on November 5, 1988, at which point

TFE provided to King a copy of an employee manual, which was titled “TFE Professional

Staffing.” During King’s employment with TFE, this employee manual was occasionally

updated either by replacement pages or by supplemental additional pages that were sent

to King. At least as of the time period relevant to this lawsuit, this manual was divided into

three separate sections: (1) Employee Handbook; (2) Schedule Wages & Fringes; and (3)

Employee Notices. 

On March 25, 1993, King was involved in a traffic accident while driving a truck (the

tractor only) during the course of his employment. Apparently, this accident occurred when

a city garbage truck pulled out in front of King, at which time King attempted to avoid the

truck by going around its rear, but lost control and ran off the road. During King’s

deposition, he described the events surrounding this accident as follows:

Q What was the weather like?

A It was sprinkling rain, drizzle.

. . . .

Q Okay. You didn’t have a trailer hooked onto the tractor part.

A Yes, I was bob-tailing.

Q Just tell me what happened, or what -- you’re coming down the

road,what caused the wreck to happen?

A The City garbage truck pulled out in front of me.

. . . .

Q And when this vehicle pulled out or whatever, what did you do?

A I applied my brakes. He proceed to back off the road. I proceed to

let off the brakes. He stopped, clearing the path where I could

accelerate. When I accelerated again, that’s all I -- I done my 

knowledge -- to avoid the wreck any way possible, and I swayed to go in

behind him. As soon as the truck hit the shoulder of the road where I could

hopefully get part of the garbage truck or go completely around him, the

shoulder gave way. The next thing I know, the truck was upside down.

After this traffic accident, King was taken to a hospital. Thereafter, during the course of
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medical treatment and recovery, King was paid temporary workers’ compensation disability

benefits up through February 25, 1994, at which point he was released by his treating

physician to return to work. On Monday, March 7, 1994, King spoke with Richard Gilbert,

who was King’s regional manager and driver supervisor, on the telephone. During this

conversation, Gilbert informed King that King’s employment was being terminated, and he

referenced and drew King’s attention to a provision within the employee manual which

explained that TFE employees could be “subject to discharge” for a “major chargeable”

accident. The next day, on March 8, 1994, Gilbert provided to the Tennessee Department

of Employment Security (and to King, who applied for and ultimately drew unemployment

compensation) a copy of a “separation notice,” which explained that King’s “discharge” was

based upon his involvement in a “major preventable accident.” On this same date, Gilbert

sent to King a letter that explained the following:

As discussed, TFE, Inc., has carefully reviewed all relevant data concerning

your March 25, 1993, accident, and found that it meets the definition of a

major preventable (chargeable) accident.

For this reason, TFE, Inc., elects to terminate your employment under the

provisions of Rule 1A, as published in your copy of the Driver Handbook.

In closing, please be advised that any request to have the Drivers’

Committee review this matter, and to thereafter make a recommendation as

to whether the company should reconsider this action, should be submitted

in accordance with procedures also contained within the Driver Handbook.

Thereafter, King, through his attorney, requested that a driver committee hearing be held

to review King’s termination. This driver committee, which is the initial avenue for review

of disciplinary action according to the “Employee Handbook” under the heading “Rules and

Regulations” and under the sub-heading “Appeal of Company Disciplinary Action,” is a

committee that is essentially comprised of popularly elected driver employees. This driver

committee hearing took place on April 30, 1994, at which time the driver committee opined

and “recommended” that King’s accident be deemed “non-preventable,” and that King’s

employment should not have been terminated. After the April 30, 1994 driver committee

hearing, King never heard from or spoke with TFE again about his employment, and his

employment was not reinstated.

On March 6, 1995, King commenced this action against TFE, alleging that King’s

employment with TFE was wrongfully terminated in violation of contractually binding terms
1. The provisions that are found within TFE’s employee manual that pertain to disciplinary procedures, as

related to the instant case, are as follows:

DISCIPLINARY PROCEDURES

[T]o insure [sic] that we protect and preserve the excellent reputation we have established,

management has developed a guideline of violations of professional performance standards

and reasonable disciplinary penalties that may be imposed upon proven violations of these

standards.

. . . .

The follow ing R ules and R egulations app ly to all employees who have completed their 90-day

familiarization period.

The Company retains th e right to m odify , add to or e limina te wo rk rules at any time a s it

deems nec essary.

RULES AND REGULATIONS

The following rules and regulations and the penalties to be charged for violations of the same

are set forth as guidelines so that all employees may know what is expected of them in the

general condu ct of the C omp any’s bus iness. This list of violations is not inclusive and the

com pany ma y add to or m odify it at any time .

Protests of discipline must be filed within ten (10) days after notice is received by employees.

1. ACCIDENTS:

A. Major Chargeable as defined by DOT 1st offense-Subject to discharge

. . . .

8. FAMILIARIZATION PERIOD EMPLOYEES:

During the first ninety (90) days of employment new employees may be discharged

at management’s discretion without regard to the above procedures.

9. APPEAL OF COMPANY DISCIPLINARY ACTION:

[T]he driver com mitte e is you r avenue of ap peal for an y complaint you may have

regarding your treatment. The m anagem ent of TFE, Inc., will give every

consideration to their recommendations and findings.

. . . .

Employees objecting to the disciplinary action taken will have ten (10) days to file a

notice to that effect in writing with TFE, Inc. In the absence of such protest, such

actio n sha ll be de em ed fin al.

INVOLUNTARY TERMINATION

In the event an em ployee is invo luntarily terminated from employment with TFE, Inc., and the

employee exhausts the company’s internal appeal provisions, at the employees request TFE

will consider submitting the matter to an Arbitrator for a final and binding remedy. The

request for arbitr ation should be made by the employee . . . within ten (10) days of the

emp loyee being notified of ter mina tion. . . . .

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and conditions set forth in TFE’s employment manual, and alleging that TFE terminated

King’s employment in retaliation of King’s workers’ compensation claim. On March 10,

1997, TFE filed a motion for summary judgment, which came to be heard by the trial court

on August 21, 1997. In addition to the pleadings, depositions from both King and Gilbert

were filed with the trial court for its consideration on TFE’s motion for summary judgment.

Thereafter, on October 3, 1997, the trial court entered an order that granted TFE’s motion

for summary judgment. In this order, the trial court explained, among other things, that the

provisions within TFE’s employee manual that related to disciplinary procedures did not

contain any specific language indicating a guarantee or binding commitment from TFE.1
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On appeal, King has asserted no error regarding the trial court’s entry of summary

judgment as related to King’s retaliatory discharge claim. The sole issue that he has

presented for this Court’s consideration is as follows:

Does a factual dispute exist that creates a genuine issue for trial as to

whether the employment of [King] was terminated by . . . TFE, Inc. in

violation of contractually binding provisions of the “TFE Professional Staffing”

manual?

ANALYSIS

As in prior similar cases, we begin our analysis of this issue with the well-established

rule “that a contract for employment for an indefinite term is a contract at will and can be

terminated by either party at any time without cause.” Rose v. Tipton County Public Works

Dept., 953 S.W.2d 690, 691 (Tenn. App. 1997); Bringle v. Methodist Hosp., 701 S.W.2d

622, 625 (Tenn. App. 1985). “Because Tennessee continues to adhere to the foregoing

‘employee-at-will’ rule, a presumption arises in this state that an employee is an employee

at will.” Rose, 953 S.W.2d at 691-92 (citing Davis v. Connecticut Gen. Life Ins. Co., 743

F. Supp. 1273, 1280 (M.D. Tenn. 1990). During King’s deposition in the instant case, he

was asked, “with regard to TFE, were you under -- is it your position or your contention that

you had -- you were under some contract for a term with them?” King’s direct response

to this specific question was “no.” King essentially contends, however, that his “at-will”

status was changed by TFE’s promulgation and issuance of its employee manual. In this

regard, this Court has previously stated and summarized the following:

Even in the absence of a definite durational term, an employment contract

still may exist with regard to other terms of employment. Williams v.

Maremont Corp., 776 S.W.2d 78, 80 (Tenn. App. 1988); accord Hooks v.

Gibson, 842 S.W.2d 625, 628 (Tenn. App. 1992). In this regard, this Court

has recognized that an employee handbook can become a part of an

employment contract. Smith v. Morris, 778 S.W.2d 857, 858 (Tenn. App.

1988) (citing Hamby v. Genesco, Inc., 627 S.W.2d 373 (Tenn. App. 1981));

accord Davis v. Connecticut Gen. Life Ins. Co., 743 F. Supp. 1273, 1278

(M.D. Tenn. 1990). In order to constitute a contract, however, the handbook

must contain specific language showing the employer's intent to be bound

by the handbook's provisions. Smith v. Morris, 778 S.W.2d at 858. Unless

an employee handbook contains such guarantees or binding commitments,

the handbook will not constitute an employment contract. Whittaker v.

Care-More, Inc., 621 S.W.2d 395, 397 (Tenn. App. 1981). As stated by one

court, in order for an employee handbook to be considered part of an

employment contract, "the language used must be phrased in binding terms,

interpreted in the context of the entire handbook, and read in conjunction

with any other relevant material, such as an employment application."
2. See supra note 1.

3. We note, however, that King’s brief places considerable reliance upon one particular provision within the

employee manual, which states:

Following the rules set forth in the American Trucking Association’s safety awards program,

TFE will make the initial determinations regarding an accident’s status. A driver may appeal

a finding of “p reventa ble” to one of the ex isting driver s afety com mittees . Either TFE or the

driver may appeal a driver committee decision to ATA’s panel of safety experts whose

decision shall be final and binding.

W e need not resolve whether this provision reflects an intent to be bound, however, because this particular

provision does not pertain to TFE’s “disciplinary procedures,” “rules and regulations,” and “involuntary

termin ations.” Inste ad, th is pro vision pertains to and is a s ub-hea ding of T FE’s “Safety Awa rd Prog ram ,”

which, as re vised , is set forth within the second part of TFE’s employee manual, titled “Schedule Wages &

Fringes .” This “Safety Awa rd Prog ram ” provides emp loymen t benefits relatin g to a driver’s pay scale, which

increases over time and/or mileage traveled in the absence of the driver having a preventable accident. “A

prev enta ble accident will not cost a driver increases previously earned under this program. However, a driver

having a pre venta ble ac cident will serve a penalty period during which the driver cannot progress to a higher

level.”

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Claiborne v. Frito-Lay, Inc., 718 F. Supp. 1319, 1321 (E.D. Tenn. 1989).

Rose, 953 S.W.2d at 692. While we have previously recognized that “an employee

handbook” can become a part of an employment contract in some cases, our concern in

the instant case is limited to the specific provisions set forth within TFE’s employee manual

that govern TFE’s “Disciplinary Procedures,” “Rules and Regulations,” and “Involuntary

Termination.”2 Our review of these provisions reveals that the pertinent language clearly

reflects TFE’s intent not to be bound either by particular procedures described therein, or

by the “recommendation” of the driver committee.3

 Under the heading “Disciplinary

Procedures,” TFE’s manual explains that its management “has developed a guideline of

violations of professional performance standards and reasonable disciplinary penalties.”

TFE thereafter states, “The Company retains the right to modify, add to or eliminate work

rules at any time as it deems necessary.” An employer’s reservation of a unilateral right

to modify such provisions within an employee handbook generally precludes such

provisions from being considered part of the parties’ employment contract. See Rose, 953

S.W.2d at 693-94 (citing Claiborne v. Frito-Lay, Inc., 718 F. Supp. 1319, 1321 (E.D. Tenn.

1989)). Under the heading “Rules and Regulations,” TFE’s manual again explains that the

“rules and regulations and the penalties to be charged for violations of the same are set

forth as guidelines, and that the “list of violations is not inclusive and the company may add

to or modify it at any time.” Under the rules and regulations sub-heading “Appeal of

Company Disciplinary Action,” TFE’s manual explains that “the driver committee is your

avenue of appeal,” but that the management of TFE will only “give every consideration to
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their recommendations and findings.” Lastly, under the heading “Involuntary Termination,”

TFE simply states that it will simply “consider submitting the matter to an Arbitrator” upon

an employee’s request after submission to the driver committee. Therefore, as we have

stated above, the language of the pertinent provisions within TFE’s employee manual

clearly reflects TFE’s intent not to be bound either by particular procedures described

therein, or by the “recommendation” of the driver committee. Moreover, as these

provisions within TFE’s employee manual must be “read in conjunction with any other

relevant material,” we find it relevant to further note that King signed a document upon

receipt of TFE’s employee manual that acknowledged, among other things, that the

manual in no way created or established an employment contract. 

CONCLUSION

Accordingly, we hereby affirm the trial court’s grant of summary judgment to TFE.

Costs are taxed to Michael King, for which execution may issue if necessary.

 

HIGHERS, J.

CONCUR:
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CRAWFORD, P.J., W.S.

 

LILLARD, J.