July 20, 2009
ANNETTE C. NANDY, R.N., PLAINTIFF-APPELLANT,
HAMPTON BEHAVIORAL HEALTH CENTER, AN AFFILIATE OF UNIVERSAL HEALTH SERVICES, INC., DEFENDANT-RESPONDENT, AND UNIVERSAL HEALTH SERVICES, INC., A TENNESSEE CORPORATION; POLLY COSTANTINI, HUMAN RESOURCE MANAGER; JOANNE WIJAYA, M.S.N., DIRECTOR OF NURSING; BARBARA DIPIERNO, RN, ASSISTANT DIRECTOR OF NURSING, DEFENDANTS.
On appeal from the Superior Court of New Jersey, Law Division, Burlington County, Docket No. L-3452-06.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued April 21, 2009
Before Judges Winkelstein, Fuentes and Chambers.
Plaintiff Annette C. Nandy brought this wrongful termination case against her former employer, defendant Hampton Behavioral Health Center, an affiliate of Universal Health Services, Inc.*fn1 Plaintiff, who was working as a nursing supervisor for defendant, was terminated from that position on September 27, 2006, due to a confrontation with another employee. She contended that this termination was in violation of defendant's verbal policy of progressive discipline. Defendant argues that it provided plaintiff with written notice of her at-will status and that plaintiff acknowledged in writing that she could be fired with or without cause and without defendant exhausting any form of progressive discipline.
The trial court granted defendant summary judgment. Plaintiff appeals that decision. We affirm, concluding that plaintiff was an at-will employee, who could be terminated with or without cause, and that defendant had no legal obligation to afford her progressive discipline.
When reviewing the granting of a motion for summary judgment we apply the same standard used by the trial court. Prudential Prop. & Cas. Ins. Co. v. Boylan, 307 N.J. Super. 162, 167 (App. Div.), certif. denied, 154 N.J. 608 (1998). Summary judgment is granted if no genuine issue of material fact is present so that the movant is entitled to a judgment as a matter of law. R. 4:46-2(c). We do not defer to the trial court's interpretation of the law, or its determination of the legal consequences that flow from undisputed facts. Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995). In determining whether a genuine issue of material fact is present, we look at the competent evidence "in the light most favorable to the non-moving party" to determine whether the evidence is "sufficient to permit a rational factfinder to resolve the alleged disputed issue in favor of the non-moving party." Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995). If not, the motion is granted. Ibid. Looking at the evidence presented on the motion through this prism, we note the following facts.
In March 1996, plaintiff, a registered nurse, was hired as a nursing supervisor by defendant. During her employment, problems developed concerning plaintiff's interaction with other staff. Although she was referred to the Employee Assistance Program, she was not subjected to any disciplinary action before her termination. On September 24, 2006, a confrontation developed between plaintiff and a subordinate that was witnessed by other staff. After conducting an investigation, defendant terminated plaintiff on September 27, 2006, due to that incident for "intimidating actions and unwelcomed harassment towards an employee."
Plaintiff filed this wrongful termination case disputing the allegation of misconduct and arguing that defendant violated its policy of progressive discipline. While defendant maintained that it had a sufficient factual basis to terminate plaintiff, it contended that pursuant to statements in employment applications completed by plaintiff and defendant's employee manual and policy and procedure manual, plaintiff was an at-will employee who could be fired with or without cause.
In numerous documents, defendant advised plaintiff that her employment was at will. Defendant's application for employment form, dated 1996 and signed by plaintiff, expressly stated that "employment is for no definite period of time and may, regardless of the date of payment of my wages and salary, be terminated at any time without any previous notice or stated reason, and I accept these conditions." Above plaintiff's signature, the form stated: "I have read and understand the above and have had the opportunity to ask questions which, if asked, were satisfactorily answered."
Once hired in 1996, plaintiff signed an acknowledgment that the Human Resources Policy and Procedure Manual was available for her review and that its provisions did "not constitute a contract of employment or impose contractual obligations" upon defendant. Plaintiff acknowledged that the manual was available for her review and that she and her supervisor reviewed the disciplinary policy on at least one occasion.
Defendant's policy of progressive discipline, as revised in 2004 and set forth in the Policy and Procedure Manual, expressly states:
. . . The Facility [defendant] prefers to attempt to correct unacceptable behavior or unsatisfactory performance through a progressive corrective process. However, the Facility reserves the right to by-pass any progressive step(s) and impose the degree of discipline, including immediate employment termination, which it deems appropriate in the sole discretion of the Facility. It is also understood that there are certain rules of conduct that are so important that their violation usually should lead to the offender's immediate employment termination.
A. General Overview
Employees are employed by the Facility on an 'at will' basis. Employment is not for a definite term and may be terminated by employee or the Facility at any time for any reason. The CEO/Managing Director or designee is the only Facility representative with the authority to make any oral or implied agreement that changes or contradicts the 'at-will' nature of employment.
Although the policy refers to progressive discipline as a preferable option available to the employer, it clearly states that the employee remains subject to immediate termination at the employer's sole discretion.
In 1999, plaintiff signed an acknowledgment that she had received defendant's Employee Handbook, although she testified at her deposition that she did not recall receiving it. Page three of the Employee Handbook contains a single paragraph that states in pertinent part:
The manual is not a contract modifying the at-will nature of your employment with the Hospital. . . . Employment by the Hospital is not for a definite term and may be terminated by you or the Hospital at any time for any reason. No employee or representative of the Hospital has any authority to make any oral or implied agreement which changes or contradicts the at-will nature of your employment. The at-will nature of your employment can only be modified by an express written agreement signed by the Chief Executive Officer of the Hospital.*fn2
In 2004, plaintiff signed an updated employment application at the request of defendant's new owners. That application contained a page entitled "Applicant's Certification and Agreement (Please Read Carefully)." Paragraph three on that page stated:
If employed, I may terminate my employment at any time without notice or cause, and the employer may terminate or modify the employment relationship at any time without prior notice or cause. . . . I understand that no department head or representative of the employer, other than the President of the Company, has any authority to enter into any agreement, oral or written, for employment for any specified period of time or to make any agreement or assurances contrary to this policy.
Plaintiff signed this page and immediately above her signature the form reads: "I have read and agree to the above . . . ."
Plaintiff certified that on numerous occasions in conversations with defendant's Human Resources Manager and defendant's Director of Nursing, she understood that defendant was committed to treating its employees "fairly so as to avoid any criticism or complaint that action was taken on an arbitrary or unreasonable basis." She also set forth numerous examples of misconduct of other employees that appeared to be tolerated at least for a while by defendant, although plaintiff admitted that she did not know what, if any, disciplinary action was taken against them. Whenever she recommended discipline of subordinates to the Human Resources Manager or the Director of Nursing, plaintiff was told that they "had to follow 'the policy.'" Plaintiff denied being advised that her employment was at-will or that the progressive disciplinary process was not mandatory, although she does acknowledge her signature on the documents. Two nurses employed by defendant also confirmed at their depositions that defendant had a policy of progressive discipline. Given our standard of review, we accept that these witnesses believed in good faith that defendant had a policy of progressive discipline.
Defendant's Director of Nursing recalled at her deposition the names of four employees who were terminated by defendant without going through the progressive discipline process and indicated that there may be more. Her testimony was unrefuted.
By order dated July 7, 2008, the trial court granted defendant's motion for summary judgment. On appeal, plaintiff contends that defendant's written disclaimers in defendant's job application forms, employee handbook, and policy and procedure manual stating that employment is at-will employment may be nullified or rescinded when contrary to the reasonable expectations of the employees due to the defendant's verbal statements and past practices; that "the reasonable expectations of the employees" involves a question of fact to be resolved by the jury; that the disclaimer clauses in defendant's documents are ineffective because they are not "clear" and "prominent"; that the disciplinary action taken against her was inconsistent with that taken against other employees; that the trial court erred in rejecting her estoppel argument; and that defendant violated the covenant of good faith and fair dealing which she claims is implicit in the employment relationship.
Absent a contractual arrangement to the contrary, employment is at-will. Bernard v. IMI Sys., Inc., 131 N.J. 91, 106 (1993). An at-will employee may be discharged from employment for any reason with or without cause, Woolley v. Hoffmann-La Roche, Inc., 99 N.J. 284, 290 (1985), subject to specific protections afforded by such laws as the New Jersey Law Against Discrimination, N.J.S.A. 10:5-1 to -49, the Conscientious Employees Protection Act, N.J.S.A. 34:19-1 to -8, and the Age Discrimination in Employment Act, 29 U.S.C.A. §§ 621-634, and the termination does not otherwise violate public policy. Pierce v. Ortho Pharm. Corp., 84 N.J. 58, 72 (1980). In addition, "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" unless the employment manual has "a clear and prominent disclaimer." Woolley v. Hoffmann-La Roche, Inc., supra, 99 N.J. at 285-86. "The reasonable expectations of [the] employees" is the key factor when determining if the employment manual contains an implied promise to terminate employment only for cause. Witkowski v. Thomas J. Lipton, Inc., 136 N.J. 385, 393 (1994).
Unless plaintiff's employment falls within one of these exceptions, she is an at-will employee. Plaintiff is asserting a Woolley type claim, contending that defendant has made implied promises that termination will be only for cause and through the progressive discipline process. She further asserts that defendant's written disclaimers are unenforceable because they are not clear and prominent and because they have been contradicted by verbal representations of defendant and by past practices.
After a careful review of the record, we conclude that defendant has made numerous disclaimers sufficient to rebut any implied promise that employment may be terminated only for cause and with progressive discipline. To be effective, a disclaimer must be sufficient to advise the reasonable reader that the document does not create legally binding obligations. Woolley v. Hoffmann-La Roche, Inc., supra, 99 N.J. at 297-99. While specific language is not required, the disclaimer must clearly advise the employee that the employer has the power to terminate employment "with or without cause." Id. at 309. The disclaimer must also be "in a very prominent position." Ibid.
The requirement of prominence may be satisfied in a variety of ways so long as it is "separated from or set off in a way to attract attention." Nicosia v. Wakefern Food Corp., 136 N.J. 401, 415 (1994). Ways to give a statement prominence include bold lettering, italics, capital letters, underlining, color, bordering, or highlighting or any other presentation that would "make it likely that it would come to the attention of an employee reviewing it." Id. at 415-16. "[T]he requirement of prominence can be satisfied in a variety of settings, and  no single distinctive feature is essential per se to make a disclaimer conspicuous." Id. at 416. Where the content and placement of the disclaimer is undisputed, the effectiveness of the disclaimer is a question of law to be decided by the court. Ibid. The question of conspicuousness is always a question of law. Ibid. After a careful review of the multiple disclaimers provided in numerous documents noted above, we conclude that they meet this standard.
Further, we are not convinced that an implied promise can be discerned in defendant's written disciplinary policy because closely interwoven in the written policy, as quoted above, is the notion that termination may be immediate, without progressive discipline, and without cause. Thus, the reasonable expectation of any employee reading defendant's written policy is that, while progressive discipline may be used, employment remains at will.
Plaintiff argues that the disclaimers in all of defendant's documents are inconsistent with defendant's "personnel policies verbally promulgated and evidenced by past practices." Plaintiff is thus attempting to extend the Woolley analysis to create an implied contract of termination for cause and progressive discipline based on verbal statements and practices. She attempts to do so, although such a finding would be contrary to a written policy of progressive discipline and numerous written disclaimers that state employment is at will.
The existence of a written employment manual was critical to the Woolley holding. The Woolley Court found that "when an employer of a substantial number of employees circulates a manual that, when fairly read, provides that certain benefits are an incident of the employment (including, especially, job security provisions), the judiciary . . . should construe them in accordance with the reasonable expectations of the employees." Woolley v. Hoffmann-La Roche, Inc., supra, 99 N.J. at 297-98. The Court found that "the context of the manual's preparation and distribution is, to us, the most persuasive proof that it would be almost inevitable for an employee to regard it as a binding commitment, legally enforceable, concerning the terms and conditions of his employment." Id. at 299.
The Court noted that "the employee is given this one document that purports to set forth the terms and conditions of his employment, a document obviously carefully prepared by the company with all of the appearances of corporate legitimacy that one could imagine." Ibid. Thus, Woolley does not support plaintiff's argument that verbal representations can form the basis of a Woolley claim. Further, if written disclaimers are sufficient to defeat implied contracts based on written policies set forth in employee manuals, then they certainly would be sufficient to defeat any implied contracts based on verbal policies.
In addition, the verbal statements of defendant's representatives and its disciplinary practices are not inconsistent with its written policy of progressive discipline. The policy states that the employer "prefers to attempt to correct unacceptable behavior or unsatisfactory performance through a progressive corrective process." The fact that plaintiff was told numerous times, regarding discipline of other employees, that the policy needed to be followed is consistent with defendant's policy that progressive discipline is preferred. The fact that defendant did not terminate or did not terminate immediately other employees with performance and disciplinary issues is also consistent with its stated written progressive discipline policy. Further, the record contains unrefuted evidence that employees, other than plaintiff, were terminated without going through progressive discipline.
For all of these reasons, defendant made no implied promise to plaintiff that she would be terminated only for cause and in accordance with its policy of progressive discipline.
Plaintiff's argument that defendant has breached the covenant of good faith and fair dealing in the employment relationship is rejected. Under New Jersey employment law, such a covenant does not arise in the employment relationship absent an express or implied contract. Wade v. Kessler Inst., 172 N.J. 327, 345 (2002). An implied covenant is not imposed on an at-will employment relationship to restrict an employer's right to terminate without cause. House v. Carter-Wallace, Inc., 232 N.J. Super. 42, 55 (App. Div.), certif. denied, 117 N.J. 154 (1989).
The balance of plaintiff's arguments are either rendered moot by this decision or are without sufficient merit to warrant discussion in a written decision under Rule 2:11-3(e)(1)(E).