In a matter raising an issue of wide concern to employers and employees, we must decide whether, in the circumstances of this case, the plaintiff, though not engaged for a fixed term of employment, pleaded a good cause of action for breach of contract against his employer because, allegedly, he was discharged without the "just and sufficient cause" or the rehabilitative efforts specified in the employer's personnel handbook and allegedly promised at the time he accepted the employment.
The operative facts deserve emphasis. Taken most favorably to the plaintiff, as they must in the context of an appeal from an order made pursuant to CPLR 3211 (subd [a], par 7)
These undertakings were important to Weiner, who alleges not only that he placed "good faith reliance" on them in leaving his existing employer, but in the process forfeited all his accrued fringe benefits and a salary increase proffered by Prentice-Hall to induce him to remain in its employ.
Following written approval, affixed at the foot of the application form by two members of the defendant's staff, one the interviewer and the other a supervisor, McGraw engaged Weiner's services. For the next eight years, so far as escalation in rank (to director of promotion services) and periodic raises in his level of compensation would seem to indicate, Weiner had every reason to believe he had, if anything, more than met the reasonable requirements of his new post. Other offers of employment he routinely rejected. Nevertheless, in February, 1977, he suddenly found himself discharged for "lack of application".
There ensued this litigation, by which, in a complaint speaking broadly in the language of breach of contract, the plaintiff seeks damages for his wrongful termination.
In upholding the complaint, Special Term merely made a point of distinguishing this case from ones like Edwards v Citibank N.A. (74 A.D.2d 553, app dsmd 51 N.Y.2d 875), where the employee, unlike here, had not bound himself to the contents of a handbook. On appeal from this decision, a divided Appellate Division reversed, on the law, and granted the motion. In effect, the majority reasoned that,
For the reasons which follow, we believe the plaintiff stated a cause of action.
Prefatorily, however, we note that the parties have supplemented the arguments they directed to the contract issue with ones which dwell, pro and con, on the effectiveness of a miscellany of such legal formulations as "abusive discharge", "implied promise of fair treatment" and "good faith", which some courts have applied, in the context of particular cases, to overcome what they conceived to be the harsh effect of inflexibly strict enforcement of at-will employment agreements, under which by their terms either employer or employee may sever the relationship without cause and without notice.
Nevertheless, by way of background, it is of interest to observe that the at-will employment rule, which originated centuries ago as an adjunct to the law of master and servant in England,
Concentrating then on plaintiff's breach of contract approach alone, initially we dispose of any Statute of Frauds point. Though not raised by the defendant, Special Term thought it pertinent. Suffice it to say that the agreement between Weiner and McGraw-Hill, whether terminable at will or only for just cause, is not one which, "by its terms", could not be performed within one year and, therefore, is not one which is barred (General Obligations Law, § 5-701; North Shore Bottling Co. v Schmidt & Sons, 22 N.Y.2d 171, 175-176; see, generally, 28 ALR2d 878).
Turning now to substance, it is also clear that the fact that plaintiff was free to quit his employment at will, standing by itself, was not entitled to conclusory effect. Such a position proceeds on the oversimplified premise that, since the plaintiff was not bound to stay on, the
As to consideration, any basic contemporary definition would include the idea that it consists of either a benefit to the promisor or a detriment to the promisee (Holt v Feigenbaum, 52 N.Y.2d 291, 299). As elaborated in Hamer v Sidway, the seminal case on the subject, "[i]t is enough that something is promised, done, forborne or suffered by the party to whom the promise is made as consideration for the promise made to him" (124 N.Y. 538, 545).
Far from consideration needing to be coextensive or even proportionate, the value or measurability of the thing forborne or promised is not crucial so long as it is acceptable to the promisee. Thus, courts have not hesitated to find sufficient consideration not only in what is now the proverbial peppercorn (Whitney v Stearns, 16 Me 394), but in "a horse or a canary, or a tomtit if [the promisee] chose" (Couldery v Bartrum, 19 Ch D 394, 399 [JESSEL, M.R.], both cited in 1 Corbin, Contracts, § 122, p 528). In fact, the detriment suffered or the thing promised need be of no benefit to the one who agreed to it. So, in Hamer what the plaintiff "suffered" was self-denial of liquor and tobacco, a sacrifice which prompted our court, quoting from Anson's Principles of Contracts (at p 63), to explain that it would "`not ask whether the thing which forms the consideration does in fact benefit the promisee or a third party, or is
Apt too in the circumstances before us now is the following comment by Corbin: "[I]f the employer made a promise, either express or implied, not only to pay for the service but also that the employment should continue for a period of time that is either definite or capable of being determined, that employment is not terminable by him `at will' after the employee has begun or rendered some of the requested service or has given any other consideration * * * This is true even though the employee has made no return promise and has retained the power and legal privilege of terminating the employment `at will'. The employer's promise is supported by the service that has been begun or rendered or by the other executed consideration" (1A Corbin, Contracts, § 152, p 14). So understood, an agreement on the part of an employer not to dismiss an employee except for "good and sufficient cause only" and, if such cause was given, until the prescribed procedures to rehabilitate had failed, does not create an ineluctable employment at will.
These propositions in mind, we find in the record, inclusive of plaintiff's own affidavit, sufficient evidence of a contract and a breach to sustain a cause of action. First, plaintiff was induced to leave Prentice-Hall with the assurance that McGraw-Hill would not discharge him without cause. Second, this assurance was incorporated into the employment application. Third, plaintiff rejected other offers of employment in reliance on the assurance. Fourth, appellant alleged that, on several occasions when he had recommended that certain of his subordinates be dismissed,
Finally, on the trial, it should, of course, be remembered that Martin itself, when, in 1895, it adopted New York's at-will rule, afforded it no greater status than that of a rebuttable presumption (148 NY, at p 121; see, also, Mandel, Preparation of Commercial Agreements [1978 ed], pp 164-165 [if no definite term is fixed by contract, a hiring at will is deemed to have resulted only "in the absence of circumstances showing a different intention"]). In determining whether such a presumption is overcome here, the trier of the facts will have to consider the "course of conduct" of the parties, "including their writings" (Brown Bros. Elec. Contrs. v Beame Constr. Corp., 41 N.Y.2d 397, 399) and their antecedent negotiations. Moreover, as Brown suggests (at p 400), it is not McGraw's subjective
Consequently, the order of the Appellate Division should be reversed and the order of Special Term reinstated.
For almost a century, the common law of New York has provided that absent some form of contractual agreement between an employee and employer establishing a durational period, the employment is presumed terminable at the will of either party and the employee states no cause of action or breach of contract by alleging that he or she has been discharged (Martin v New York Life Ins. Co., 148 N.Y. 117). Plaintiff seeks to avoid the effect of this rule by alleging that a statement in defendant's personnel manual, entitled "McGraw-Hill and You", that employees would be dismissed "for just and sufficient cause only", together with a reference to the manual in a printed application form he signed when he applied to defendant for employment, constitutes an agreement by defendant to employ him "for the remainder of his working life".
In my view, as a matter of law, neither document alone nor in combination contains any language indicating that defendant intended to be bound by their contents. Thus no question of fact was presented for jury consideration and the court below properly dismissed the first cause of action for breach of contract. The employment in question was terminable at the will of either party and plaintiff has no cause of action against defendant for breach of contract simply because he was discharged.
The printed application form, entitled "EMPLOYMENT APPLICATION", spells out none of the critical terms of plaintiff's employment. No reference is made to the type of work plaintiff was being considered for, salary, or the duration of the hiring. In fact, nothing either explicitly or implicitly suggests that defendant has offered plaintiff a position or that plaintiff has accepted an offer of employment.
Similarly, defendant's personnel manual expresses no intent that defendant be immutably bound by the document. Nor would one expect the manual to contain any strict promissory language, given that, as the court below noted, defendant could unilaterally amend or withdraw any of the provisions found there. Nothing in either the manual or the employment application form prohibited defendant from so modifying the manual in its sole discretion. "McGraw-Hill and You" is nothing more than a conglomerate of broad internal policy guidelines generally followed, none of which even slightly portend to enumerate the essential elements of a contract of employment between defendant and an employee. No language expressing an intent to be bound appears in the personnel manual, and no such intent can fairly be construed from any of the policy guidelines espoused.
Considerations of public policy also dictate against broad judicial construction of the documents in question to present a triable issue as to whether they constitute an employment contract. It has been suggested that restricting an employer's ability to discharge an employee for unsatisfactory performance will create additional inefficiency
In view of today's record high unemployment, and considering that between 1975 and 1980 approximately 60,000 industry-related jobs in New York were lost as a direct result of business migration, I cannot join the majority's bestowal of contractual rights based upon documents which make it all too clear that no contractual rights were ever intended.
Accordingly, I respectfully dissent and vote to affirm.
Order reversed, with costs, and the order of Supreme Court, New York County, reinstated.