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Kane v. Milikowsky

Decided: April 25, 1988.


On appeal from Superior Court of New Jersey, Law Division, Bergen County.

Gaulkin, Gruccio and D'Annunzio. The opinion of the Court was delivered by D'Annunzio, J.A.D.


Plaintiff was employed as president and chief executive officer of defendant, Prospect Industries, Inc. (Prospect) in September 1982. Prospect is a subsidiary of defendant, Prospect Purchasing Corporation. The other corporate defendants are subsidiaries of Prospect. All corporate defendants are wholly owned by defendant, Nathan Milikowsky and his brother Daniel Milikowsky. Plaintiff was also a member of Prospect's Board of Directors. He was fired in February 1984. Plaintiff testified that he was told that the company could not afford his salary. David Milikowsky testified that he and Nathan were unhappy with plaintiff's performance and that the company needed to cut overhead.

Plaintiff commenced this action seeking damages for wrongful

discharge under a variety of legal theories.*fn1 The only theory of recovery before us is based on Woolley v. Hoffmann-La Roche, Inc., 99 N.J. 284 (1985), mod., 101 N.J. 10 (1985). The trial judge ruled against plaintiff and we affirm.

In Woolley, the Court held that "an implied promise contained in an employment manual that an employee will be fired only for cause may be enforceable against an employer even when the employment is for an indefinite term and would otherwise be terminable at will." Id., 99 N.J. at 285-286. Plaintiff contends that four memoranda written by him in 1982 and 1983, constitute an employment manual and contain an implied promise that no employee, including the president of the corporation, will be fired without cause. We find it unnecessary to address the applicability of Woolley to a corporate president*fn2 because in our view the memoranda relied upon by plaintiff do not include an implied promise that employees will be fired only for cause.

The first memorandum, dated October 1, 1982, is not relevant. It is limited to plaintiff's establishment of a management committee on labor relations and identifies the committee members.*fn3 The third memorandum, dated November 3, 1982, was addressed to non-union employees and was limited to the subject of employee benefits. It addressed holidays, vacations, sick days, salary reviews, incentive bonus and group health and life benefits. The fourth memorandum, dated December 13, 1983, was addressed to all department heads regarding "1982 PERSONNEL PERFORMANCE REVIEWS." It announced that the corporation had developed a performance appraisal

procedure which would serve "as the basis for determining employee compensation increases each year." We fail to perceive in those three memoranda, considered individually or as a group, any implied promise not to terminate employment without cause. See Ware v. Prudential Ins. Co., 220 N.J. Super. 135 (App.Div.1987).

Plaintiff relies primarily on the second memorandum titled Company Rules. It bears the legend "Effective 11/1/82," and is reproduced as an appendix to this opinion. These rules are clearly an attempt to define employee actions which will constitute industrial offenses in the eyes of Prospect and to give notice to employees of the elements of those offenses and the consequences to an employee if he engages in prohibited action. The rules provide no basis for an implied promise not to terminate without cause. Cf. Ware, supra. at 145-146.

In Woolley, that part of the manual relied upon by the Supreme Court was titled "Termination" and contained six numbered sections dealing with termination. The Woolley manual in section III defined "the types of termination" as layoff, discharge due to performance, discharge disciplinary, retirement and resignation. Therefore, the manual in Woolley supported the conclusion that it was intended to be a comprehensive treatment of the subject of employment termination. In the present case, plaintiff's memoranda do not purport to cover comprehensively the subject of termination.

Moreover, Section II of the Woolley manual declared the policy of Hoffman-La Roche to be "to retain to the extent consistent with company requirements, the services of all employees who perform their duties efficiently and effectively." There is no similar undertaking or expression of policy in the Prospect memoranda.


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