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Miller v. Beneficial Management Corp.

argued: July 16, 1992.

ELIZABETH G. MILLER, APPELLANT
v.
BENEFICIAL MANAGEMENT CORPORATION, A CORPORATION OF THE STATE OF DELAWARE; BENEFICIAL MANAGEMENT CORPORATION OF AMERICA, A CORPORATION OF THE STATE OF DELAWARE; BENEFICIAL CORPORATION, A CORPORATION OF THE STATE OF DELAWARE



On Appeal from the United States District Court for the District of New Jersey. (D.C. Civil Action No. 89-3089)

Before: Scirica, Roth and Higginbotham, Circuit Judges

Author: Scirica

Opinion OF THE COURT

SCIRICA, Circuit Judge.

In this employment discrimination case, the district court granted summary judgment for defendants, holding that plaintiff's claims were barred by the applicable statutes of limitations and, in the alternative, that there were no material factual disputes and defendants were entitled to judgment as a matter of law. Miller v. Beneficial Management Corp., 776 F.Supp. 936 (D.N.J. 1991) ("Letter Opinion"). We will reverse.

I. FACTS AND PROCEDURAL HISTORY

A

Defendant Beneficial Management Corporation is in the business of providing management services. The Government Relations Department of Beneficial is involved in lobbying, organizing political action committees, and collecting political contributions.

Plaintiff Elizabeth Miller was born in 1927 or 1928. She graduated from law school in 1980. In October 1980, Beneficial hired Miller as an Associate Counsel in Beneficial's Legal Department. Miller's starting salary was $25,000. By 1983, Miller's annual salary had increased to $31,000, with a year-end bonus of $3,000. Salary increases and year-end bonuses at Beneficial are awarded based on merit.

In the Legal Department, Miller reported to Charles Hance, Esq., Senior Vice President and General Counsel. In 1983, Hance prepared a formal review of Miller's performance in the Legal Department. At Beneficial, a formal review is referred to as a "Bentrak." Hance ranked Miller eighth out of eight attorneys who reported to him. The 1983 Bentrak gave Miller good marks with respect to her organizational and planning skills, motivation, initiative and energy, but rated her overall performance as below expectations. It noted a difficulty in providing practical advice satisfactory to senior personnel. It also stated Miller had to improve her personal impact in order to be effective in her position.

Charles Walsh (on whose compensation Miller bases her equal pay claim) was hired by Beneficial in October 1966. Walsh graduated from law school in 1954 and worked for two years at a Philadelphia law firm. In 1956, Walsh joined the Pennsylvania Attorney General's office as an associate counsel for the Insurance Commission. At the Attorney General's office, Walsh was promoted to general counsel and subsequently to deputy insurance commissioner for Pennsylvania. In 1963, Walsh became the executive vice president of Reliable Insurance Company. Around May 1, 1966, Walsh became deputy insurance commissioner for the Commonwealth of Kentucky.

Walsh began his employment at Beneficial as Director of Insurance Relations. In 1968, Walsh was promoted to Assistant Vice President. In 1973, Walsh was asked to join the Legal Department as Assistant Vice President, Associate Counsel. Walsh also represented Beneficial in various trade organizations and became Chairman of the Board of the Consumer Credit Insurance Association. In 1976 or 1977, Walsh was promoted to Vice President of Government Relations.

In 1975, Kenneth Raatz was hired as an Associate Counsel in the Legal Department. Raatz was assigned to work with Walsh and Senior Vice President Helmuth Miller in Government Relations, where he assisted Walsh in the review of legislation.

In 1979 or 1980, Helmuth Miller resigned and was replaced by David Ward. Ward assumed Miller's responsibilities as Senior Vice President. Walsh testified he had less authority and independence under Ward. Walsh's compensation while in Government Relations ranged from a base salary of $41,000 and a year-end bonus of $14,000 in 1977 to a base salary of $55,000 and a year-end bonus of $28,500 (for a total of $83,500) in 1984.

In early 1984, Ward informed Elizabeth Miller that Walsh's and Raatz's employment in Government Relations would soon be terminated. Ward invited Miller to join the Government Relations Department to replace Walsh and Raatz.

Miller alleges Ward told her that with hard work she would become a Vice President and would receive compensation at a level equivalent to Walsh's. Miller joined Government Relations on July 1, 1984. Her base salary was increased by $9,000 to $40,000 per year. Miller was assigned Walsh's office and both Walsh's and Raatz's secretaries.

In a March 14, 1984 memorandum to David Farris (President and CEO of Beneficial Management Corporation), Ward stated:

As you know, I am consolidating two attorney positions into one and Charles Walsh and Ken Raatz will be leaving July 1.

To keep costs down I have arranged to fill the position with an in-house lawyer, Beth Miller, and to do so I am recommending a salary increase for her in connection with the transfer to $40,000 commencing July 1, 1984.

Mrs. Miller brings with her an excellent academic background and four years of experience with us. After some earlier concerns [see the 1983 Bentrak], Mr. Hance has indicated that her performance has improved greatly. I have worked with her, on bankruptcy in particular, and am thoroughly convinced of her capabilities and of her potential in the Government Relations Department.

With this transfer we will be upgrading our capability at a cost, including the increase, of about 30% of our current cost. I have reviewed about 100 resumes and I believe that to find an outside replacement of equivalent background would cost at least $10,000 more and probably double that. Also, there would be a substantial learning period involved with any outside attorney regardless of experience.

This recommendation is, in my opinion, justified and will result in a satisfied and productive employee, and will be a low cost solution both long-run and short-run. . . .

On May 31, 1984, the Management Salary Committee approved Ward's recommendation that Miller "be transferred to the Government Relations Department as Associate Counsel replacing Messrs. C. Walsh and K. Raatz, effective July 1, 1984." The Committee also approved the proposed salary increase.

In a June 6, 1985 memo to Finn Caspersen, Beneficial's Chairman of the Board, Ward recommended Miller be promoted to Assistant Vice President. Ward stated:

[Miller] joined Government Relations July 1, 1984 taking over the Associate Counsel slot occupied by Ken Raatz, but also took on many of the duties of Charlie Walsh, who was not replaced.

She has performed very well, and after a few months of intensive background training, is making a real contribution. She is now effectively performing Walsh's functions, with many of the other functions being pushed down to the two individual's [sic] who work for her.

She is presently in Grade 15 which is an Assistant Vice President slot, and should be promoted in recognition that she has taken over duties formerly performed by a Grade 17 Vice President. . . .

I recommend a promotional increase of 10% of her current salary of $43,000 for an increase of $4300 to the annual rate of $47,300. . . .

On June 15, 1985, Miller was promoted to Assistant Vice President and her annual salary increased to $47,300.

In January 1986, Miller first spoke to her superiors about being promoted to Vice President of Government Relations. Farris and James Gilliam, Senior Vice President and General Counsel, told her to speak to Ward. In March 1986, Miller spoke to Ward about a possible promotion. Ward handed Miller a Bentrak he had prepared. The 1986 Bentrak was paraphrased by Beneficial in its 12G Statement as follows:

In the category of "Interpersonal Skills," it was noted that [Miller's] motivation was excellent, but that she had problems in communications and in supervising subordinates. With regard to "Professional Skills," an improvement was noted in substantive knowledge, but also a consistent tendency to jump to Conclusions without fully understanding the problem. The Bentrak stated that [Miller's] inability to distinguish important legislation from unimportant ones adversely affected her productivity. The Bentrak did note that her technical skills such as bill drafting and analysis were good and improving and stated that these skills should continue to improve as she gained a better understanding of the business context. With regard to "Management Skills," it was noted that [Miller's] initiative, energy, dependability and ambition were excellent, with the caveat that her ambition sometimes appeared excessive. It also was noted that [Miller's] attitude toward others was considered condescending and counterproductive. In addition, the Bentrak stated that her decision-making ability suffered from her reluctance to inquire into the background of matters and to ask penetrating questions. . . . Finally, the Bentrak noted that [Miller's] judgment was not trusted by some and suggested that this may have been due to [Miller's] relative lack of business and industry experience.

Miller and Ward discussed the 1986 Bentrak at a weekend office meeting, at which time Ward agreed not to put the 1986 Bentrak in Miller's personnel file.

Throughout 1986 and 1987, Miller spoke to Ward about becoming a Vice President. Miller maintains that Ward responded by saying that she was "making the money" and therefore didn't need the title. In January 1987, Miller received a year-end bonus of $8,000, plus an increase in her base salary to $50,200. Miller states that throughout this period her workload increased, partly as a result of Ward's additional responsibilities in other areas, which detracted from the time he was able to spend on Government Relations work. In an October 23, 1987 memo to Caspersen, Ward recommended Miller for a salary increase, stating:

Mrs. Miller has done an excellent job in the past year, assuming quite a bit more work from me while I was involved in much of the restructuring and expense control activity over the past 15 months or so. This [increase] will also bring her more closely in line with salaries in the legal department for lawyers of similar seniority, where it is my understanding she has lagged behind for a few years.

By memo of February 25, 1988, Ward recommended that Miller be promoted to Vice President, stating:

Would like to recommend that she be given V.P. title promotion - no concurrent pay increase. Three reasons - deserved [sic] improvement in performance handling state GR matters in past year and this will help her in dealing with matters when I'm gone and very importantly will help our image with women legislators and this is becoming more important all the time.

On March 4, 1988, Ward took a leave of absence from Beneficial to participate in an eleven-week program at Harvard University. During Ward's absence, Miller was instructed to handle state legislation and administrative matters. The district court stated that "the Government Relations Field Directors were to review any major policy decisions with Caspersen or Farris and all federal Government Relations matters were to be referred to an outside consultant." Letter Opinion at 21. However, as the district court notes, "Miller presents a different account of her duties during Ward's leave of absence." Id.*fn1 Miller testified that "while Ward was at Harvard, I ran the Government Relations Department without supervision by David Farris, Finn Caspersen or any other higher ranking executive."

Ward returned to Beneficial on May 23, 1988. A few days later, Miller approached Ward regarding a promotion to Vice President. Miller contends the conversation went as follows:

Ward responded that he had recommended to Finn Caspersen earlier in the year . . . that I be made a Vice President and that Caspersen had turned down that recommendation. . . . When I asked Ward why he had not told me of this previously, he simply said something about it being a "white lie." Ward then went on to say that I would never get the title of Vice President and that Finn Caspersen had the total say in the matter. I then told Ward that Mary Ann Schneider had recommended that I draft a JAQ [Job Analysis Questionnaire] for the committee which evaluated promotions. Ward laughed and said that the committee did not make those decisions.

Miller claims that Ward told her "your best bet is to leave and sue on age discrimination" and to go work for the government, which could not discriminate on the basis of age. Miller also contends that Ward asked her how long she intended to work if she got the title of Vice President. Ward states he never told Miller she should sue for age discrimination.

Ward allegedly told Miller that he would recommend her for Vice President in July 1988 and that she should compile a list of Beneficial's recent promotions from personnel. Miller maintains that Ward suggested she ask Gilliam to assign her to another attorney position so Ward could hire someone who would be able to take over his position in three or four years. Ward concedes that he and Miller spoke of a replacement for him. Ward states, however, that he told Miller she would most likely not replace him because he intended to stay at Beneficial for another 17 years, until he reached retirement age. Ward has since left Beneficial.

According to Miller, Ward suggested that Caspersen might promote her to Vice President if Ward could hire someone to eventually replace himself. Miller indicated that if she were not going to make Vice President, she would be interested in an available Field Director (lobbyist) position. According to Miller, Ward told her the position ...


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