J.H. GILLIS, J.
Plaintiff, Bruce H. Schwartz, appeals from a February 13, 1980, order of the Saginaw County Circuit Court granting defendant summary judgment. Plaintiff had alleged that he was wrongfully and unjustly discharged from defendant's
Plaintiff's complaint can be broken down into three claims. First, he alleges the existence of an implied contract of employment to continue until age 65, absent termination for just cause. Second, plaintiff claims that his discharge was in retaliation for his effective performance as company safety director and that defendant thereby violated the Michigan Occupational Safety and Health Act (MIOSHA), MCL 408.1001 et seq.; MSA 17.50(1) et seq. Finally, plaintiff argues that, as a long-term employee, by law he could only be discharged for just cause.
Neither defendant's motion nor the subsequent opinion and order specified whether the summary judgment was based on GCR 1963, 117.2(1) or 117.2(3). Although defense counsel argued that plaintiff had failed to "state a claim upon which relief can be granted", the parties and court relied on various depositions and documents recorded with the court. Further, defendant's motion and accompanying memorandum argued that there was no genuine issue of material fact and that it was entitled to judgment as a matter of law. The lower court's opinion concluded:
"The court finds that under Michigan law that a contract of employment for an indefinite period, or a contract for permanent employment, is a contract for employment at will, and the employee involved may be terminated by the employer at any time, for any cause, or without cause. The court further finds that if the termination is in retaliation for actions of the employee on the job, or for attempting to `do too good a job', the cases are uniform that the employer still retains the right to discharge the employee."
A motion for summary judgment under GCR 1963, 117.2(1) tests the legal sufficiency of the plaintiff's pleadings, which for purposes of the motion are considered to be true. Weckler v Berrien County Road Comm, 55 Mich.App. 7, 9; 222 N.W.2d 9 (1974). The appropriate test is whether the plaintiff's claim is so clearly unenforceable as a matter of law that no factual development can possibly justify a right to recovery. Crowther v Ross Chemical & Manufacturing Co, 42 Mich.App. 426, 431; 202 N.W.2d 577 (1972).
A motion for summary judgment under GCR 1963, 117.2(3) tests the factual sufficiency of the plaintiff's claim. The court is to consider affidavits, pleadings, depositions and other documentary evidence submitted by the parties. Sanders v Clark Oil Refining Corp, 57 Mich.App. 687, 692; 226 N.W.2d 695 (1975). The court is to give the benefit of any reasonable doubt to the party opposing the motion and thereafter grant the motion only if it is impossible for the claim to be supported at trial because of a deficiency which cannot be overcome. Rizzo v Kretschmer, 389 Mich. 363, 372; 207 N.W.2d 316 (1973).
Contracts for permanent employment are generally considered to be indefinite hirings terminable at the will of either party. Lynas v Maxwell Farms, 279 Mich. 684, 687; 273 NW 315 (1937). Nonetheless, a contract providing that the employee shall be discharged for cause only is enforceable. Toussaint v Blue Cross & Blue Shield of Michigan, 408 Mich. 579, 598, 609-610; 292 N.W.2d 880 (1980). Enforceable contractual rights of this nature may result from statements of company
In the instant case, there were no such statements of employee policy or procedure. Plaintiff readily conceded in his deposition that he was never told he would be employed until the age of 65, absent termination for cause. Further, he admitted that his superiors never made statements that would have led him to believe as much. He argues, however, that the circumstances of his employment require that such a contractual agreement be implied in fact.
"A contract implied in fact arises under circumstances which, according to the ordinary course of dealing and common understanding, of men, show a mutual intention to contract. In re Munro's Estate (1941), 296 Mich. 80. A contract is implied in fact where the intention as to it is not manifested by direct or explicit words between the parties, but is to be gathered by implication or proper deduction from the conduct of the parties, language used or things done by them, or other pertinent circumstances attending the transaction. Miller v Stevens (1923), 224 Mich. 626."
Thus, an employer's conduct and other pertinent circumstances may establish an unwritten "common law" providing the equivalent of a just cause termination policy. Rules and understandings, promulgated and fostered by the employer, may justify a legitimate claim to continued employment.
A review of plaintiff's deposition testimony reveals that his claim of an implied contract for continued employment was based on his own subjective expectancy regarding his relationship with the company. Plaintiff based his belief on the fact that the company was originally a closeknit family operation, not known for its high salaries, with virtually no employee turnover. The company, though it had no established sick leave policy, usually paid sick employees for extended periods of time. Further, literature on the company's pension plan indicated that all employees would be eligible unless the particular employee "was injurious or detrimental to the interests of the company". Plaintiff concluded that it was a "foregone conclusion that if you perform your job competently and are an asset to the company, the natural expectation is that you will continue to be employed by the company".
These circumstances do not evidence a common understanding or mutual intent to contract that employment be continuing but for cause. The pension plan condition does not manifest an employment guarantee, but evidences that pension benefits can be lost through detrimental employee actions. For example, a long-term employee could be precluded from receiving a pension if he took employment with a competing firm. Plaintiff conceded that he attached no independent significance to the brochures. Likewise, although the company paid relatively low salaries, that was not perceived
Plaintiff's deposition testimony made it clear that he felt he could only be discharged for cause not because of any representations or policies promulgated, but because of his own personal belief that an employee doing competent work would be retained as a company asset. Plaintiff considered this "a convenience in almost any company". Such a subjective belief is insufficient to establish a contract implied in fact. Thus, although plaintiff's complaint sufficiently pled a cause of action on this theory, in fact, plaintiff's basis for the claim is not the objective circumstances of his employment, but his own personal view of what the law should be.
Plaintiff's second theory is that he was discharged because of his effective performance as safety director. In effect, plaintiff contends that his rigorous enforcement of MIOSHA regulations precipitated his dismissal.
We agree that a termination in contravention of a strong public policy is wrongful and an exception to the general rule that such employment contracts are terminable at will. Cf., Trombetta v Detroit, T & I R Co, 81 Mich.App. 489; 265 N.W.2d 385
"A person shall not discharge an employee or in any manner discriminate against an employee because the employee filed a complaint or instituted or caused to be instituted a proceeding under or regulated by this act or has testified or is about to testify in such a proceeding or because of the exercise by the employee on behalf of himself or herself or others of a right afforded by this act."
It is apparent that the Legislature intended to protect employees, like plaintiff, allegedly discharged in an employer's attempt to avoid the MIOSHA restrictions. If plaintiff's allegations are correct, his termination contravened the policy evidenced by the subsection.
Nonetheless, plaintiff's action must fail since he declined to pursue the administrative remedies contained in MIOSHA itself
Plaintiff's final theory for recovery is that the law now prohibits discharge for malicious or retaliatory
This issue was recently before the Michigan Supreme Court in Prussing v General Motors Corp, 403 Mich. 366; 269 N.W.2d 181 (1978), where the Court declined to rule on the specific question. Because we consider such a doctrine a radical departure from the common law and Michigan precedent, we believe that if it is to be judicially mandated that change should come from the Supreme Court. We, therefore, affirm the lower court dismissal of plaintiff's complaint under that theory as well.
C.L. BOSMAN, J., concurred.
BRONSON, P.J. (dissenting in part, concurring in part).
This is an appeal by plaintiff from a February 13, 1980, order of the Saginaw County Circuit Court granting summary judgment in favor of defendant. Plaintiff averred in a complaint filed on April 17, 1979, that he was wrongfully and unjustly discharged by defendant after 28 years of service, 11 of these years in the capacity of safety director.
Although not specifying in its order or opinion which subsection of the summary judgment rule it was relying on, the dismissal was apparently based on GCR 1963, 117.2(1), failure to state a claim upon which relief can be granted. Like the majority, however, I believe that plaintiff's claims must be considered under both GCR 1963, 117.2(1) and 117.2(3).
Plaintiff's complaint basically sets forth three different theories. First, he argues that he had an
In Lynas v Maxwell Farms, 279 Mich. 684, 687; 273 NW 315 (1937), the Supreme Court held:
"Contracts for permanent employment or for life have been construed by the courts on many occasions. In general it may be said that in the absence of distinguishing features or provisions or a consideration in addition to the services to be rendered, such contracts are indefinite hirings, terminable at the will of either party."
Accord, Hernden v Consumers Power Co, 72 Mich.App. 349, 356; 249 N.W.2d 419 (1976), Milligan v The Union Corp, 87 Mich.App. 179, 182; 274 N.W.2d 10 (1978), Rowe v Noren Pattern & Foundry Co, 91 Mich.App. 254, 258; 283 N.W.2d 713 (1979), lv den 409 Mich. 880 (1980), Clink v Board of County Road Comm'rs of Livingston County, 96 Mich.App. 524, 530; 294 N.W.2d 209 (1980).
In the instant case, plaintiff alleged that he had
The Court in Toussaint also made it clear that the plaintiff's own testimony that it was company policy not to discharge an employee as long as he did his job was sufficient to create a jury question. Id., 603. In Schipani v Ford Motor Co, 102 Mich.App. 606; 302 N.W.2d 307 (1981), this Court held that even a written employment agreement in which plaintiff acknowledged he could be terminated at any time without advance notice did not necessarily bar an action under the Toussaint doctrine where oral representations and employer's manuals assured the employee that dismissal would be for cause only.
Defendant's position, however, is that even if summary judgment were not proper pursuant to GCR 1963, 117.2(1), it was nevertheless appropriate based on GCR 1963, 117.2(3), no genuine issue
Plaintiff gave extensive deposition testimony in this matter. He stated that when he first started with defendant, the company was family owned, had virtually no turnover, and it was tacitly understood that any employee would be retained until age 65. Plaintiff indicated that this benefit was a trade-off for the relatively low wages defendant paid. He also stated that the company went to great lengths to retain employees. For instance, sick employees would be paid their salaries for years even though they could not work. Plaintiff further indicated that one of his superiors implied that he had a terrific future with the company. Plaintiff also claimed to rely on written statements of the company in regard to pension plans. These statements indicated all employees would be eligible for a plan unless the employee "was injurious or detrimental to the interests of the company". Plaintiff also testified that the general employment practices he had observed defendant pursue over the years led him to believe that if one performed his job capably one would not be let go until age 65. He had been told on several occasions that he was doing a good job. He further stated that he had given up more lucrative offers of employment in 1950 following defendant's decision to hire him.
While plaintiff admitted nobody with defendant ever told him he would be employed until age 65 as long as he did his job well, he was led to believe this by the company's actions. A major factor in
Based on this testimony, it is clear that no express agreement existed between plaintiff and defendant that plaintiff would not be discharged prior to age 65 except for good cause. However, as noted previously, an agreement not to discharge may also be premised on an employer's procedures and policy statements. Although plaintiff's case does not impress me as overwhelming based on his deposition testimony, it did, nonetheless, provide sufficient factual support for his contention that he was terminable before age 65 only for good cause. The Court in Toussaint, supra, 617-618, quoted with approval the following excerpt from Perry v Sindermann, 408 U.S. 593, 601-603; 92 S.Ct. 2694; 33 L Ed 2d 570 (1972), in rendering its decision:
"`A written contract with an explicit tenure provision clearly is evidence of a formal understanding that supports a teacher's claim of entitlement to continued employment unless sufficient "cause" is shown. Yet absence of such an explicit contractual provision may not always foreclose the possibility that a teacher has a "property" interest in re-employment. For example, the law of contracts in most, if not all, jurisdictions long
"`A teacher, like the respondent, who has held his position for a number of years, might be able to show from the circumstances of this service — and from other relevant facts — that he has a legitimate claim of entitlement to job tenure. Just as this Court has found there to be a "common law of a particular industry or of a particular plant" that may supplement a collective-bargaining agreement, so there may be an unwritten "common law" in a particular university that certain employees shall have the equivalent of tenure. This is particularly likely in a college or university, like Odessa Junior College, that has no explicit tenure system even for senior members of its faculty, but that nonetheless may have created such a system in practice.
"`In this case, the respondent has alleged the existence of rules and understandings, promulgated and fostered by state officials, that may justify his legitimate claim of entitlement to continued employment absent "sufficient cause."' (Citations omitted.)"
I disagree with the majority's analysis of plaintiff's deposition testimony. I believe that reasonable jurors could conclude from all the surrounding circumstances that there was an implied agreement that plaintiff's employment would be continued except for discharge for good cause. First, the jury might find from plaintiff's testimony concerning the defendant's employer's practices, for instance that employees were paid even while sick over extensive periods of time, that dismissal only for cause was the "common law" in defendant's business. Second, the jury might find that the information concerning retirement plans
Even assuming that plaintiff can make out a case that the terms of his contract with defendant precludes discharge except for good cause, it still must be ascertained if plaintiff has sufficiently pled that his dismissal was unjust. Plaintiff apparently concedes that defendant had lost money during the year of his discharge. However, this is not dispositive. Plaintiff also pled in his complaint and stated in his deposition that his termination was due to the rigorous nature of his safety program. Plaintiff conceded that saving his salary was also a reason for his discharge. However, he denies that his termination was actually occasioned by the monetary losses and a genuine desire to save money by reducing personnel. Plaintiff further notes that he was the sole employee dismissed for the ostensible purpose of economizing. In Toussaint, supra, 622, the Supreme Court held that the jury is permitted to ascertain the true reason for the employee's discharge. On the facts as pled, a jury hearing this case could conclude that defendant's legitimate financial worries were merely a convenient excuse to ascribe to plaintiff's firing and that the real reason was for some improper purpose such as weakening the company's safety program. As such, this cause should have been submitted to a jury.
I now turn to a consideration of whether plaintiff's claim that he was discharged for doing his job as safety director "too well" states a legally cognizable cause of action. Where an employee's discharge would contravene a strong public policy, this Court has recognized an exception to the general rule that employment contracts for an indefinite term are terminable at will. Thus, in Sventko v The Kroger Co, 69 Mich.App. 644; 245 N.W.2d 151 (1976), this Court held that the discharge of an employee in retaliation for her filing a lawful workers' compensation claim was inconsistent with the public policy of this state and constituted a wrongful dismissal. See, also, Trombetta v Detroit, T & I R Co, 81 Mich.App. 489; 265 N.W.2d 385 (1978), lv den 403 Mich. 855 (1978) (complaint alleging that plaintiff's employment was terminated for his refusal to alter pollution control reports required by the state stated a cause of action upon which relief could be granted).
Defendant contends that the public policy exception to the rule that employment contracts for an indefinite term are terminable at will applies to only two situations: (1) where the employee alleges that his employer attempted to force him to commit an unlawful act or (2) where the employee has been fired for claiming some benefit he is legally entitled to claim. I disagree with this analysis and hold that any termination which contravenes a clear public policy is wrongful. MIOSHA mandates the regulation of working conditions with an eye toward safety. MCL 408.1065(1); MSA 17.50(65)(1) provides:
"A person shall not discharge an employee or in any manner discriminate against an employee because the
In my opinion the emphasized portion of the provision quoted above manifests an intent to protect from discharge employees in the position in which plaintiff alleges he finds himself. To the extent that plaintiff can prove he was fired for his rigorous enforcement of MIOSHA regulations, this provision prohibits his dismissal.
Defendant further argues that even if the above interpretation of MCL 408.1065(1); MSA 17.50(65)(1) is correct, plaintiff's action must fail because he has failed to exhaust his administrative remedies. An administrative review procedure is set forth in MCL 408.1065(2)-(8); MSA 17.50(65)(2)-(8). As a general rule, litigants must exhaust administrative remedies before resorting to a legal action in the courts of law. School Dist of the City of Benton Harbor v State Tenure Comm, 372 Mich. 270; 126 N.W.2d 102 (1964), Judges of the 74th Judicial Dist v Bay County, 385 Mich. 710, 727-728; 190 N.W.2d 219 (1971). In the instant case, none of the traditional exceptions to this rule are applicable.
Unfortunately for plaintiff, the time period in which he should have filed a complaint with the Department of Labor on the MIOSHA claim has now passed. However, an administrative remedy is not inadequate simply because a litigant fails to
Plaintiff lastly contends we should hold that all employment contracts terminable at will include as a covenant of the contract an obligation in the employer to discharge employees in good faith only and that it is improper to discharge for malicious or retaliatory reasons. At least one state has gone this far. In Monge v Beebe Rubber Co, 114 N.H. 130, 133; 316 A.2d 549, 551-552 (1974), the New Hampshire Supreme Court stated:
"In all employment contracts, whether at will or for a definite term, the employer's interest in running his business as he sees fit must be balanced against the interest of the employee in maintaining his employment, and the public's interest in maintaining a proper balance between the two. (Citation omitted.) We hold that a termination by the employer of a contract of employment at will which is motivated by bad faith or malice or based on retaliation is not in the best interest of the economic system or the public good and constitutes a breach of the employment contract. (Citations omitted.) Such a rule affords the employee a certain stability of employment and does not interfere with the employer's normal exercise of his right to discharge, which is necessary to permit him to operate his business efficiently and profitably."
The Michigan Supreme Court had occasion to consider Monge in Prussing v General Motors Corp, 403 Mich. 366; 269 N.W.2d 181 (1978). However, it declined to commit itself on the issue of whether an employee could be discharged without cause. Instead, the Court found for defendant
It would constitute a radical departure from the common law and Michigan precedent for us to hold that an employee can be discharged for good cause only. While I believe the rule is sound — particularly in respect to long-term employees — if this change is to be judicially mandated, it will have to come from our Supreme Court.
I would reverse in part, affirm in part, and remand. The trial in this cause would proceed solely on plaintiff's theory that the discharge violated an implied contractual covenant that he could only be discharged for cause, and this covenant was breached.