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Grasser v. United Healthcare Corporation

July 24, 2001

JOHN R. GRASSER, JR., PLAINTIFF-RESPONDENT
v.
UNITED HEALTHCARE CORPORATION, DEFENDANT-APPELLANT



On appeal from Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-12026-99.

Before Judges Skillman, Conley and Lesemann.

The opinion of the court was delivered by: Lesemann, J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued February 6, 2001

By leave granted, defendant appeals from an order denying its motion to dismiss or remand to arbitration plaintiff's complaint alleging wrongful termination of his employment.*fn1 The complaint included charges of breach of contract, defamation and other common law causes of action as well as a charge of age discrimination in violation of the New Jersey Law Against Discrimination (LAD), N.J.S.A. 10:5-1 to -49. Defendant claimed that plaintiff had waived his right to file such a complaint and had agreed instead to binding arbitration of any such dispute. The claim was premised on plaintiff having signed an "Employee Handbook Acknowledgment" (the Acknowledgment) by which he agreed to be bound by arbitration procedures embodied in defendant's "Employment Arbitration Policy." That policy, in turn, was summarized and described in an Employee Handbook (the Handbook) which had been distributed to plaintiff and, presumably, other employees as well. Defendant claims that, even if the signed Acknowledgment did not express a clear and unambiguous waiver of rights to file a LAD complaint, the Handbook did contain such a statement and, by incorporation, satisfied the requirement that any such waiver by an employee be clear, specific and unambiguous. We find, however, that the reference in the Acknowledgment (the only document signed by plaintiff) did not satisfy that requirement, that defendant therefore did not meet its burden of demonstrating a knowing and binding waiver of plaintiff's right to maintain this suit, and accordingly, we affirm the decision of the trial court.

In or around 1969, when he was nineteen years old, plaintiff John R. Grasser, Jr., began working with Metropolitan Life Insurance Company (Metropolitan) in its Information Systems Department. Twenty-six years later, Metropolitan joined with Traveler's Insurance Company to form a new entity, MetraHealth. Plaintiff continued his employment with that new entity and remained an employee of MetraHealth until January 1996, when the company was purchased by defendant United HealthCare Corporation (UHC).

In January 1996, shortly after it acquired MetraHealth, defendant distributed to plaintiff (and presumably other employees as well) a "shrink-wrapped" copy of its Employee Handbook. Plaintiff acknowledges receiving the Handbook but says no one ever discussed it with him or explained any of its provisions. However, on February 22, 1996, plaintiff signed the Acknowledgment referred to above which contained the following provisions:

I acknowledge that I have received a copy of the United HealthCare Corporation (UHC) Code of Conduct and the Employee Handbook. I understand that these documents contain important information on UHC's general personnel policies and on my obligations as an employee. I will remain familiar with, and agree to abide by these policies.

I understand that the provisions in this Handbook are guidelines and, except for the provisions of the Employment Arbitration Policy, do not establish a contract or any particular terms or condition of employment between myself and UHC. None of the policies constitute or are intended to constitute a promise of employment. I further understand that UHC may periodically, at its discretion, change, rescind, or add to any policies, benefits or practices with or without prior notice.

Internal Dispute Resolution/Employment Arbitration Policy (section A5). These policies provide the opportunity for prompt and objective review of employment concerns. I understand that arbitration is the final, exclusive and required forum for the resolution of all employment related disputes which are based on a legal claim. I agree to submit all employment related disputes based on a legal claim to arbitration under UHC's policy.

On March 10, 1999, defendant terminated plaintiff's employment asserting that he had violated defendant's policy on sexual harassment. Plaintiff responded by instituting this suit alleging, as noted above, a violation of LAD together with a number of common law claims related to his discharge. Defendant then moved to dismiss or stay plaintiff's suit based on what it claimed was plaintiff's agreement to submit all such disputes to arbitration. When plaintiff responded by arguing that the signed Acknowledgment was not sufficiently clear or specific to bar his claims, defendant referred to the Handbook itself. It argued that, even if the signed Acknowledgment alone was not sufficient to bar plaintiff's complaint, the Acknowledgment incorporated the relevant provisions of the Employee Handbook, those provisions were thus also binding upon plaintiff, and they are clear, specific and sufficient to bar plaintiff's suit. The Handbook provisions, as they relate to this appeal, read as follows:

Statement of Intent

UHC believes that the resolution of disagreements that arise between an individual employee and UHC or between employees in a context that involves UHC are best accomplished by internal dispute review (IDR) and, where that fails, by arbitration conducted under the rules of the American Arbitration Association. Employees and UHC benefit from the use of private arbitration because it usually results in quicker, less costly resolution of disagreements than ...


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