Opinion ID: 2617108
Heading Depth: 1
Heading Rank: 5

Heading: Employment Contract Claims

Text: It is now settled law in Wyoming that employment is presumed to be at will; however, that presumption can be modified by an express or an implied-in-fact agreement. Brodie v. General Chemical Corporation, 934 P.2d 1263, 1265 (Wyo.1997); Loghry v. Unicover Corporation, 927 P.2d 706, 710 (Wyo.1996). An employment handbook or personnel policies, letters of employment, performance evaluations and an employer's course of dealing may supply terms for an implied-in-fact employment contract which requires termination for cause only unless it contains a sufficient disclaimer. Loghry, 927 P.2d at 710; Lincoln v. Wackenhut Corp., 867 P.2d 701, 703 (Wyo.1994). The test is whether there has been an objective manifestation of assent to an employment contract containing a job security provision. Davis, 934 P.2d at 1249. In this case, Bear claims that the VOA personnel policies, the employment letter, her performance evaluation, and the federal grant modified her at will status to one providing that she could not be dismissed from her employment without cause. The VOA personnel policies contained a disclaimer that Bear challenges as insufficient. Our review of it confirms that it is legally sufficient to preserve her at will status. The disclaimer of contract language is on page one, is capitalized and it clearly and unambiguously states that the policies are not a contract of employment, employment may be terminated at any time for any reason, and the employer has reserved the right to alter the policies' language at any time. Lincoln, 867 P.2d at 703-04; Davis, 934 P.2d at 1252. However, that legally sufficient disclaimer states in part: Finally, no employee, manager, minister or officer of Volunteers of America of Wyoming, Inc., other than the COO or director, has any authority to offer, or enter into, an agreement for employment for a specific period of time with Volunteers of America of Wyoming, Inc., employees or applicants, or to make any agreement contrary to the above policy. In Loghry, we held that this language in a disclaimer meant that only the company employee specified could alter at will status. Loghry, 927 P.2d at 711. Bear was hired on December 21, 1994. Her hiring followed a negotiation process in which she and Fletcher, COO and director of VOA, verbally agreed that if she accomplished certain things she would receive a higher salary and permanent employment following a six month probationary period. Fletcher sent Bear an Employment Letter which stated that following a satisfactory probation she would receive a letter of regular employment. When she began working, Bear was given a copy of the June 1994 personnel policies. Bear did accomplish what she had promised and received a raise in salary and, according to her evaluation conducted by Fletcher, was accorded permanent employment. Bear contends this letter and the evaluation by the director alter her at will status. In Wilder v. Cody Country Chamber of Commerce, 868 P.2d 211, 218 (Wyo.1994), this Court stated: We hold that a claim by an employee that the employer promised permanent employment does not alter the at will presumption without additional consideration supplied by the employee or explicit language in the contract of employment stating that termination may only be for cause. Wilder determined that parties could choose to provide that termination is for cause even in a contract of employment of indefinite duration. Id. For Wilder, the court found he had not provided additional consideration by changing employers, but ruled a question of fact existed regarding a promise to discharge only for cause in the words as long as I did the work that was required. Id. Bear's accomplishments which resulted in her increased salary cannot be considered additional consideration. She simply did the job she was hired to do in exchange for compensation. The question is whether the employment letter and evaluation following her negotiations with Fletcher, who is authorized by the disclaimer to alter at will status, present the same situation as that which occurred in Wilder and establish a contract for indefinite duration but requiring good cause for discharge. If the use of the term permanent employment in documents signed by Fletcher is not sufficiently explicit to change VOA's unfettered right to discharge at any time and without cause, then this is a situation which simply falls under the rule of Allen v. Safeway Stores, Inc. 699 P.2d 277, 282 (Wyo.1985), where this Court said that the employee's [s]ubjective understandings and expectations do not establish an employment contract with a definite term of duration. Wilder, 868 P.2d at 229 (Golden, J., concurring and dissenting); Mobil Coal Producing, Inc. v. Parks, 704 P.2d 702, 704 (Wyo.1985) (recognizing an implied employment contract). Unlike Wilder, we do not have any language explicitly stating an intent to promise job security to Bear, and we hold that her employment status was at will. See Davis, 934 P.2d at 1249-52. Bear also contends that she did not receive the disclaimer when she was hired, and it is, therefore, ineffective for her. In her affidavit dated December 2, 1996, Bear states that she read and relied on these policies. She references to Exhibit B, which is a copy of the policies, including the disclaimer page. She says, To my knowledge, I was never asked to sign a copy of these personnel policies until March 1996 when Julie Hutson asked me to sign the March 1996 version, which I refused. It is unclear from this record whether Bear had not read the disclaimer and was unaware of it or had read the disclaimer but had not signed one. Either of these situations presents the question of whether it matters if the employee knows of the particulars of an employer's distributed policies. We conclude it makes no legal difference. In Nicosia v. Wakefern Food Corp., 136 N.J. 401, 643 A.2d 554, 558-62 (1994), the New Jersey Supreme Court, a leading court in employment law, said that the fired employee did not have to know of either for cause provisions or disclaimer provisions in order to be covered by them. According to that court, the critical inquiry was whether the employer's manual as a whole, regardless of its actual receipt by the employee, gives rise to an implied contract of employment because of its termsincluding most importantly those relating to employment securityand its wide distribution.... An employee may not select among the provisions of a[sic] employment manual to determine which provision should give rise to enforceable contractual obligations. If Nicosia seeks to rely on provisions in the employee handbook as the source of an implied contract of employment, then he must accept the agreement as a whole with its attendant responsibilities. ... In this case, then, the eleven-page excerpt [which covered disciplinary procedures] must be considered in light of the entire [160-page] manual, including the disclaimer [which appeared in the first paragraph on the manual's first page], even if Nicosia was unaware that the excerpt was part of a larger employment policy document. Id. 643 A.2d at 559 (citation omitted). The court proceeded to review the disclaimer, of which the fired employee was unaware but which had been distributed to the workforce, and found it deficient. Id. at 559-62. The Nicosia court also decided Woolley v. Hoffmann-La Roche, 99 N.J. 284, 491 A.2d 1257, modified, 101 N.J. 10, 499 A.2d 515 (1985), which we have favorably cited in some of our employment decisions. In Woolley the court quoted favorably from Toussaint v. Blue Cross & Blue Shield of Mich., 408 Mich. 579, 292 N.W.2d 880, 892 (1980), which said that it does not matter that the employee knows nothing of the particulars of the employer's distributed policies. Woolley, 491 A.2d at 1268. Reliance is presumed; a strict contractual analysis is not made because otherwise some employees would be protected and others would not. Id. at 1268 n. 10. And see Labus v. Navistar Intern. Transp. Corp., 740 F.Supp. 1053, 1060-62 (D.N.J.1990). We are satisfied that VOA distributed the manual, including the first-page disclaimer, to its newly hired employees. Whether or not the employees read or signed it makes no legal difference. The disclaimer, as well as all provisions of the entire handbook, are binding on the employer and the employee, even if the employee is unaware of them. Finally, Bear asserts she was a third party beneficiary of the contract between VOA and OJJDP because of the following contract language: The Project Director and key program personnel designated in the application shall be replaced only for compelling reasons and with the prior concurrence of the OJJDP. Approval of the successor is contingent upon submission of a resume and verified statement of most recent salary. Changes in other program personnel require only notification to the OJJDP with the same documentation as for the Project Director unless otherwise designated in the award document. Prior approval is required for Advisory Board members and consultants used in the project. Bear was designated as the project director under the grant, and she contends this is sufficient to establish that she was a third-party beneficiary of the contract. There is no question that a promise may be made to one person for the benefit of another and a third-party beneficiary may enforce his rights under a contract, although not a party to nor specifically mentioned in the contract; but there is more to it than that. An outsider claiming the right to sue must show that it was intended for his direct benefit. Otherwise he may be only an incidental beneficiary because the compelling provisions of a contract require that his claims be satisfied in order to protect another. However, an incidental beneficiary acquires no right of action against the promisor or promisee. Wyoming Machinery Co. v. U.S. Fidelity and Guaranty Co., 614 P.2d 716, 720 (Wyo. 1980) (citing Peters Grazing Assoc. v. Legerski, 544 P.2d 449 (Wyo.1975); Graham and Hill v. Davis Oil Company, 486 P.2d 240 (Wyo.1971)). In Richardson Associates v. Lincoln-Devore, Inc., 806 P.2d 790 (Wyo.1991), we considered RESTATEMENT (SECOND) CONTRACTS § 302 (1981) in determining whether a third person was an intended third-party beneficiary of a contract: (1) Unless otherwise agreed between promisor and promisee, a beneficiary of a promise is an intended beneficiary if recognition of a right to performance in the beneficiary is appropriate to effectuate the intention of the parties and either (a) the performance of the promise will satisfy an obligation of the promisee to pay money to the beneficiary; or (b) the circumstances indicate that the promisee intends to give the beneficiary the benefit of the promised performance. (2) An incidental beneficiary is a beneficiary who is not an intended beneficiary. Richardson Associates, 806 P.2d at 807. The contract between OJJDP and VOA addressed all aspects of establishing and administering the juvenile services to be funded by the grant. The purpose of the contract was to protect the grant funds. The one provision of the contract in this case addressing discharge of the project director was not intended to benefit that director, but was intended to further effectuate the protection of the grant funds by permitting OJJDP some control over the quality of personnel. Bear is an incidental beneficiary, not an intended beneficiary, and acquires no right of action against VOA.