Court Opinion

ID: 9737162
Source: CourtListenerOpinion
Date Created: 2023-08-26 19:17:50.361791+00
Date Added: 2024-06-11T07:23:56.913976
License: Public Domain

GARRARD, Judge,
dissenting.
I respectfully dissent. It is, of course, true in Indiana that where one is hired for no fixed term he is considered an employee at will and may be terminated at any time.
I disagree vehemently, however, with the First District's statement in Mead Johnson and Co. v. Oppenheimer (1984), Ind.App., 458 N.E.2d 668, 671 that "[elmployee handbooks are immaterial without an enforceable agreement between the employer and employee of employment for a definite duration."
We are, after all, concerned with the law of contracts in these cases; that is to say, with the rights and duties flowing from an offer and acceptance. Acceptance may arise from performance.
As I pointed out concurring in Shaw v. S.S. Kresge Co. (1975), 167 Ind.App. 1, 328 N.E.2d 775, where an employer chooses to adopt and promulgate an employee handbook which specifies employee rights to vacations, holidays with pay, systems for discipline, ete. and in acceptance thereof the employee performs the work assigned, ete., there is an enforceable contract and the employer is not free to unilaterally change the terms retroactively. The employer may change the terms prospectively since there is no specific term for such a contract. When the employer does so and notifies its employees of the proposed changes, it is offering a "new" contract which the employees may accept by continuing to perform their work.
By the foregoing I do not mean to say that every handbook constitutes a contract. Factual questions may occur, for example, as to whether employees were ever notified such that an offer was made. Furthermore, such handbooks may be so hedged in preserving an employer's discretion or in vague generalizations that they merely create the illusion of a specific policy or benefit. When such is the case it is not our function to write a new agreement for the parties imposing obligations they did not choose to impose upon themselves.
But if an employer chooses to tell its at will employees that upon the completion of six months service they are entitled to a week's paid vacation, and the employees perform, then at the conclusion of the six months the employer may not with impunity change its mind and deny vacation benefits. I see no difference 'if the employer, instead, through its employee manual or statement of policies, states that beyond a certain probationary period employees will only be discharged for cause or that a first offense of a certain type will be punished by a reprimand.1 The employer may only alter such policies prospectively without incurring liability for its breach.
I agree with the majority in the present case that Tri-City's action in discharging Franklin was not tantamount to state action merely because Tri-City was a recipient of federal funds. Indeed, it appears to me that is substantially why the federal government, as a condition to funding, might deem it desirable that potential recipients be required to adopt certain policies and procedures concerning the recipients' activities. 'The government thereby requires the recipient-employer to establish and maintain particular policies which be*1308come contractually enforceable between the employer and its employees.
On that basis I believe Tri-City's Personnel Policies Manual was properly introduced in evidence and was available as proof of Tri-City's obligations.
Examination of the manual fails to reveal any self-imposed restriction on the grounds for which Franklin might be discharged. (While the manual in Article 3400 states general guidelines for "minor offenses," "general offenses" and "serious offenses" it carefully avoids stating any restriction on Tri-City's ability to discharge for any particular reason. Article 8200 defines when employees will be classified as having permanent status but imposes no provision restricting discharge of such "permanent" employees.) o
Article 3400, Discipline, does, however, provide that when an employee appears to have committed a breach of acceptable behavior the supervisor will conduct an investigation which "shall" include a discussion with the employee "who will be afforded the opportunity to make an oral or written statement in his behalf or to present additional information."
In addition, Article 3600 provides a grievance procedure for the review of employee complaints and Article 3716 titled '"Termination of Permanent Employee" provides that termination of a permanent employee Tor disciplinary purposes shall be in accord with Article 8400 and that "grievance procedures in accordance with Article 8600 are applicable in all cases."
From the foregoing it appears to me that the court could have determined that while Franklin was not entitled to reinstatement, she was entitled to prove damages for TriCity's breach of contract in failing to follow its promulgated policies of conducting an investigation including giving Franklin the opportunity to be heard and in refusing to permit Franklin to use the grievance procedure to secure a review of her discharge. Since the jury's award of $15,000 is not challenged as excessive or unsupported by the evidence, I would affirm the judgment.

. Such things are all the familiar grist of collective bargaining agreements although in the vast majority of instances the contracts apply to employees who are "at will" in the sense they have no specific term of employment.