Court Opinion

ID: 9473451
Source: CourtListenerOpinion
Date Created: 2023-08-05 04:30:18.575407+00
Date Added: 2024-06-11T17:43:32.368193
License: Public Domain

NORRIS, Circuit Judge,
dissenting:
I dissent because I cannot distinguish this case in any meaningful way from Cleary v. American Airlines, Inc., 111 Cal.App.3d 443, 168 Cal.Rptr. 722 (1980).1 The issue here is not whether TWA can reduce its workforce for economic reasons but whether it can effect that reduction without complying with its own established bumping policy.
In Cleary, the California Court of Appeal considered under what circumstances an at-will, long-term employee could recover on a theory of wrongful discharge. Id. at 446, 168 Cal.Rptr. at 724. The court held that although the plaintiff was an at-will employee, he stated a cause of action because of two alleged facts: (1) he was a long-term employee of eighteen years, and (2) the employer adopted a written regulation, which expressed the employer’s policy and procedure with respect to employee grievances and discharge. Id. at 447-48, 168 Cal.Rptr. at 724. The court concluded that longevity of employment, “together with the expressed policy of the employer, operate as a form of estoppel, precluding any discharge of such an employee by the employer without good cause.” Id. at 456, 168 Cal.Rptr. at 729 (emphasis added).
I read Cleary as standing for the proposition that when an employer promulgates an express policy relating to termination, an at-will, long-term employee may not be arbitrarily terminated in disregard of the policy. As the Cleary court explained, the existence of an express policy “compels the conclusion that this employer had recognized its responsibility to engage in good faith and fair dealing rather than in arbitrary conduct with respect to all of its employees.” Id. at 455, 168 Cal.Rptr. at 729.
Here we also have at-will, long-term employees. We also have the critical fact that the employer adopted a policy and practice relating to the termination of at-will employees, specifically that the employees would not be terminated as part of a reduction- in the work force without first being given an opportunity to displace junior employees in other management positions for which they were qualified. Here, as in Cleary, the employer allegedly terminated plaintiffs in disregard of its policy, acting without any apparent reason and without notice of its intention to abandon the policy. I believe it is arguable that in this sense *1396TWA acted no less arbitrarily than American Airlines did in Cleary by discharging Cleary without following the expressed policy set forth in its written regulation.
The rationale of the California Court of Appeal in Cleary seems to be that if an employer adopts a policy limiting its freedom of action to terminate at-will, long-term employees, it may not act arbitrarily in disregarding that policy. Significantly, the Cleary court not only uses the word “arbitrary,” id. at 455, 168 Cal.Rptr. at 729, but also uses the phrase “[the adoption of] the expressed policy of the employer, operate[s] as a form of estoppel____” Id. at 456, 168 Cal.Rptr. at 729 (emphasis added). Thus, there seems to be a recognition that an employer should anticipate that even at-will employees may continue their employment relationship in reliance upon the employer’s stated policies.
I recognize that in our case the TWA policy manual containing the bumping policy also contained a disclaimer that is arguably designed to preclude employees from relying upon the policy. It is not clear from the Cleary opinion whether the express policy there contained a similar disclaimer. I have difficulty believing, given the reasoning of the Cleary court, that such a disclaimer would be held to nullify the element of employee reliance on an explicit policy in continuing his or her long-term employment relationship.
In sum, because I have difficulty distinguishing Cleary from this case, I would hold that we should reverse the grant of summary judgment.2 Although the California courts have not yet fully developed the contours of the newly emerging law in this area, such as how much notice or cause is necessary, Cleary seems to be authority at least for the proposition that an employer cannot change the rules for long-term employees without any notice or cause.

. In order to find that appellants cannot recover under the implied covenant of good faith and fair dealing theory, we have to distinguish Cleary, not Pugh v. See’s Candies, Inc., 116 Cal.App.3d 311, 171 Cal.Rptr. 917 (1981), or Shapiro v. Wells Fargo Realty Advisors, 152 Cal.App.3d 467, 199 Cal.Rptr. 613 (1984). Pugh is precedent on appellants’ implied contract theory, but not on the good faith and fair dealing theory. The employment application here expressly stated that the employment was terminable at will. Thus, under Pugh, appellants’ claim does not give rise to an implied contract. Shapiro is not controlling because the plaintiffs there were not long-term employees and they did not allege a failure by their employer to follow its own express employment termination policy and procedures.

. Under my analysis, of course, it would be necessary to reach the choice of law issue which the majority finds it unnecessary to reach.