Opinion ID: 195995
Heading Depth: 2
Heading Rank: 3

Heading: The bad-faith-termination claim

Text: 77 Lastly, we turn to Coll's claim that PB fired him in bad faith in order to deprive him of a benefit to which he was entitled. 78 Under Massachusetts law, the implied covenant of good faith and fair dealing prohibits an employer from terminating an employee in order to deprive him of a benefit to which he is entitled. Fortune v. National Cash Register, Inc., 373 Mass. 96, 364 N.E.2d 1251, 1257 (1977). Essentially, [a]n employer may not discharge an employee in order to ... reap for itself financial benefits due [the] employee. Maddaloni v. Western Mass. Bus Lines, Inc., 386 Mass. 877, 438 N.E.2d 351, 356 (1982) (citing Fortune, 364 N.E.2d 1251). An employer's obligation of good faith and fair dealing imposes liability for the loss of compensation clearly related to an employee's past service when that employee is discharged without good cause. Gram v. Liberty Mut. Ins. Co., 384 Mass. 659, 429 N.E.2d 21, 27-29 (1981). As we noted in Biggins, 79 [T]he Gram court was careful to distinguish between recovery based on the employee's loss of future wages for past services, and any claim for recovery based on loss of future income for future services. The Massachusetts Supreme Judicial Court explicitly limited this theory of wrongful discharge to situations in which the employee's discharge without good cause deprives the employee of compensation for services previously earned or past services. 80 Biggins v. Hazen Paper Co., 953 F.2d 1405, 1416 (1st Cir.1992) (discussing Gram, 429 N.E.2d at 27-29). Fortune liability does not encompass situations where the employee merely was fired arbitrarily. Id. Rather, in order to establish a claim of wrongful termination, the plaintiff must demonstrate that his discharge was contrived to despoil [him] of earned commission or similar compensation due for past services. Id. 81 In the present case, we do not find that Coll's termination deprived him of any particular benefit to which he was entitled. Coll contends that because his termination occurred just as he was pressing [PB's Board] to define the goals of the LTIP, there is a genuine issue as to whether the Board terminated him to avoid paying him nearly $1,000,000 under the LTIP. Brief for Appellant at 44. The undisputed facts do not support this contention. Coll's own writings indicate that two of the four goals of the LTIP would not be met, and that there was thus no potential for payout in 1992 under the LTIP: Half of the goals ... will not be met.... Profitability and positive cash flow are now forecast for 1993, not 1992. The retentive and motivational capabilities of the LTI are therefore compromised for 1992.... The Board's minutes echo this: A management proposal to replace the Company's Long-Term Incentive Plan was considered. The existing Plan appears unlikely to produce incentive compensation payments under the Company's present business forecasts. Accordingly, we agree with the district court that Coll's termination did not strip him of compensation due for past services, and affirm the dismissal of Coll's wrongful termination claim. 82 We have considered the other issues raised by Coll and find them equally meritless. 83 Affirmed.