Terrance P. Towle, Plaintiff-appellant, v. Flexel Corporation, Defendant-appellee, 68 F.3d 484 (10th Cir. 1995)

ORDER AND JUDGMENT¹ 

HOLLOWAY

After examining the briefs and appellate record, this panel has determined unanimously that oral argument would not materially assist the determination of this appeal. See Fed. R. App. P. 34(a); 10th Cir. R. 34.1.9. The case is therefore ordered submitted without oral argument.² 

Plaintiff Terrance Towle filed this diversity action against defendant Flexel Corporation, alleging he was fired in violation of an express or implied contract of employment. The district court granted Flexel's motion for summary judgment on the grounds that Towle failed to present evidence that he was actually or constructively discharged by Flexel, or that Flexel breached any contract of employment. We affirm.

Towle removed a four by eight foot section of wall from Flexel's building, apparently believing the wall hindered access to his working area in the event of a fire. Appellant's App. at 34-35, 68, 98-100. The next day, Towle's supervisor asked him why he had removed the wall, and told Towle he would report the incident to Flexel's management. Appellant's App. at 99-100.

Two days later, when Towle was off work, two of Flexel's managers requested him to report to the plant for a meeting to discuss the incident. At the end of the meeting, the managers told Towle not to come to work that evening because his shift was covered for the rest of the week. The managers told Towle to call in the next day and they would tell him what disciplinary action, if any, Flexel would take against him. The managers then escorted Towle out of the building with some of his personal belongings. Appellant's App. at 100, 106.

At 7:30 a.m. the next morning, Towle called a friend of his in management, Robert Morris. Appellant's App. at 101, 129. According to Towle's version of this conversation, Morris told him, " [T]he decision is made.... I can't get you out of this one." Appellant's App. at 101. Towle said he asked Morris what he should do, and Morris told him he could still retire. Appellant's App. at 101. Towle went to the plant shortly thereafter and filled out his retirement papers. Appellant's App. at 101-02.

On appeal, Towle contends the district court erred in entering summary judgment dismissing his complaint because the evidence, viewed in a light most favorable to him, supports an inference that he was either actually or constructively terminated, that he was employed under an implied contract of employment, and that Flexel breached that contract.

Summary Judgment Standards

We review the grant of summary judgment de novo. James v. Sears, Roebuck & Co., 21 F.3d 989, 997-98 (10th Cir. 1994). "Summary judgment is appropriate if 'there is no genuine issue as to any material fact and ... the moving party is entitled to a judgment as a matter of law.' " Hagelin for President Comm. v. Graves, 25 F.3d 956, 959 (10th Cir. 1994) (quoting Fed. R. Civ. P. 56(c)), cert. denied, 115 S. Ct. 934 (1995). An issue of fact is "material" only when the dispute is over facts that might affect the outcome of the suit under the governing law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The requirement of a "genuine" issue of fact means that "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. at 248.

"In applying this standard, we construe the factual record and reasonable inferences therefrom in the light most favorable to the party opposing summary judgment." Blue Circle Cement, Inc. v. Board of County Comm'rs, 27 F.3d 1499, 1503 (10th Cir. 1994). The language of Rule 56(c) mandates the entry of summary judgment "against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986).

Actual or Constructive Termination

We agree with the district court's conclusion that Towle did not present evidence that he was constructively discharged by Flexel. Constructive discharge occurs when an employer, by its illegal or unjustified acts, has made working conditions so intolerable that a reasonable person in the employee's position would feel compelled to resign. See, e.g., James v. Sears, Roebuck & Co., 21 F.3d at 992; Derr v. Gulf Oil Corp., 796 F.2d 340, 344 (10th Cir. 1986); Turner v. Anheuser-Busch, Inc., 7 Cal. 4th 1238, 1244-47, 876 P.2d 1022, 1025-27 (1994). Towle's unsupported belief that he would lose his retirement benefits if he did not retire to avoid termination is insufficient to demonstrate working conditions so intolerable as to support a constructive discharge claim.

Towle contends he was actually terminated at the time he was escorted out of the plant following the meeting with Flexel's managers. We conclude that the evidence that Towle was escorted out of the plant with some of his personal belongings, and told not to return to work, coupled with Morris' statement to Towle the next morning that, " [T]he decision is made," is sufficient to preclude summary judgment on the basis that Towle was not actually terminated. Therefore, we turn to consideration of whether, even if actual termination occurred, Towle's rights were violated.

The Evidence of Breach

We conclude that even if Towle presented an issue of fact as to whether he had been actually terminated, this issue is not "material" under Rule 56(c) because the record reveals that Towle did not present evidence demonstrating that such termination violated Flexel's discipline policy. Because the district court concluded there was insufficient evidence of actual or constructive termination, it did not discuss in any detail its alternative conclusion that there was no evidence that Flexel breached its disciplinary policy. This does not preclude our consideration of the issue, however, "as we are free to affirm a district court decision on any grounds for which there is a record sufficient to permit conclusions of law, even grounds not relied upon by the district court." See Griess v. Colorado, 841 F.2d 1042, 1047 (10th Cir. 1988) (internal quotation omitted).

"Kansas follows the general rule that, in the absence of a contract covering the duration of employment, the employment is terminable at the will of either party." Dickens v. Snodgrass, Dunlap & Co., 872 P.2d 252, 259 (Kan.1994) (internal quotation omitted). "An employer may agree as a part of an employment contract to limit its otherwise absolute right to discharge or discipline its employees." Cussimanio v. Kansas City S. R.R., 617 P.2d 107, 111 (Kan.Ct.App.1980). "Whether in any particular case an employer can discharge its employees without cause and not incur liability is a question that is to be resolved with reference to the express and implied terms of the contract." Id. at 112.

Here, Towle presented evidence that Flexel has a "three-step" discipline policy to address unsatisfactory employee performance: first, informal, verbal contact; second, a written note in the employee's file; and, third, a "problem case" category. Appellant's App. at 159. However, the same section of Flexel's discipline policy expressly states that " [i]t is not necessary to take each or any of the three steps before discharge. Some situations may be serious enough to merit immediate disciplinary action up to and including discharge." Appellant's App. at 159. Flexel's discipline policy and employment manual list certain conduct for which an employee may be discharged, including "willful abuse of ... [c]ompany property." Appellant's App. at 160, 182.

Further, both Robert Morris and Leo Bracciano, an administrative superintendent for Flexel, testified in deposition that Flexel was not required to go through all of the steps before discharging an employee. Appellant's App. at 131, 185-86. Towle did not controvert the evidence that Flexel was free to discharge an employee without following all of the steps in its discipline policy.

Thus, assuming arguendo that Flexel's discipline policy constituted an employment contract with Towle, summary judgment was, nevertheless, appropriate because the policy expressly authorizes Flexel to discharge an employee without taking any of the outlined steps. See Plummer v. Humana of Kan., Inc., 715 F. Supp. 302, 304 (D. Kan. 1988) (summary judgment granted in favor of employer where progressive discipline policy also provided for immediate discharge at the convenience of the employer). Towle does argue that the determination of whether his conduct constituted "willful abuse of company property" is a question of fact for a jury. However, he admitted in his deposition that he had no prior authority to remove the wall, Appellant's App. at 98, 100, and he did not controvert the evidence that his actions were willful and damaged Flexel's property. Appellant's App. at 131, 189.

Towle also presented Flexel's Admission No. 23 that said " [e]mployees at Flexel are to be given a hearing concerning decisions by Flexel to terminate their employment." Appellant's App. at 153. In connection with this evidence, Towle argues that his "claim is based on contract. The procedure guaranteed plaintiff arises from the prior dealings and assertions made by defendant. Defendant has admitted that a hearing is required." Appellant's Reply to Brief for Appellee at 10 (citing Admission 23).

Towle presented no other evidence concerning the nature of Flexel's obligation to conduct a hearing. There is nothing in the record to suggest that Towle's meeting with Flexel's managers before being escorted out of the building, at which he was given the opportunity to present his explanation for his actions, was inadequate to satisfy Flexel's hearing policy. Appellant's App. at 100, 103. Accordingly, Towle failed to present evidence sufficient to establish that Flexel breached its discipline policy.

The judgment of the United States District Court for the District of Kansas is affirmed.