{
  "id": 4738632,
  "name": "TONY C. HARRIS v. DUKE POWER COMPANY, a corporation",
  "name_abbreviation": "Harris v. Duke Power Co.",
  "decision_date": "1987-06-02",
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    "judges": [
      "Justice Martin joins in this concurring opinion."
    ],
    "parties": [
      "TONY C. HARRIS v. DUKE POWER COMPANY, a corporation"
    ],
    "opinions": [
      {
        "text": "MEYER, Justice.\nIn his complaint, plaintiff alleged that he had been employed as a welder by Duke Power Company at the Catawba Nuclear Power Plant and that he was discharged without cause in November 1984. Plaintiff further alleged that defendant\u2019s termination policy, as contained in its management procedure manual on the subject of \u201cRules of Conduct,\u201d was incorporated and became an integral part of his contract of employment. A copy of the management procedure pamphlet was attached to the complaint.\nPlaintiff alleged that he was discharged from his employment in violation of the employer\u2019s Rules of Conduct as contained in the management procedure manual. He did not allege that he was employed for a fixed term or that he had furnished any special consideration for the incorporation of these rules in his employment contract.\nThe sole question presented on this appeal is whether the trial court erred in dismissing plaintiffs complaint. We hold that under the facts and circumstances of this case, plaintiff has failed to allege a cause of action sufficient to withstand defendant\u2019s motion to dismiss, and we therefore affirm the opinion of the Court of Appeals.\nThe superior court granted defendant\u2019s motion to dismiss, and the Court of Appeals affirmed, based upon plaintiffs status as an employee-at-will. The majority of the panel below held that even if the provisions of the management procedure were made part of plaintiffs contract of employment, plaintiff had no right to relief because the procedure did not contain any promise or representation that defendant would discharge plaintiff only for cause. Judge Phillips dissented, arguing that the plaintiffs complaint raised the issue of whether his employment was subject to conditions set forth in defendant\u2019s management procedure manual.\nNorth Carolina courts have repeatedly held that absent some form of contractual agreement between an employer and employee establishing a definite period of employment, the employment is presumed to be an \u201cat-will\u201d employment, terminable at the will of either party, irrespective of the quality of performance by the other party, and the employee states no cause of action for breach of contract by alleging that he has been discharged without just cause. Still v. Lance, 279 N.C. 254, 182 S.E. 2d 403 (1971).\nThe \u201cemployee-at-will\u201d rule is subject to some well-defined exceptions. First, statutory authority often dictates that an otherwise terminable-at-will employee shall not be discharged in retaliation for certain protected activities, e.g., filing workers\u2019 compensation claims, N.C.G.S. \u00a7 97-6.1 (1985); engaging in labor union activities, N.C.G.S. \u00a7 95-83 (1985); instituting an Occupational Safety and Health Act proceeding, N.C.G.S. \u00a7 95-130(8) (1985). Second, if an employee furnishes \u201cadditional consideration\u201d or gives something additional of value, such consideration may take the case out of the usual employment-at-will rule. Tuttle v. Kernersville Lumber Co., 263 N.C. 216, 139 S.E. 2d 249 (1964) (setting forth exception, but declining to apply to the facts); Sides v. Duke University Hospital, 74 N.C. App. 331, 328 S.E. 2d 819, disc. rev. denied, 314 N.C. 331, 333 S.E. 2d 490 (1985) (plaintiffs moving from Michigan to North Carolina to accept position with defendant was additional consideration which took contract out of traditional employment-at-will rule). Cf. Malever v. Jewelry Co., 223 N.C. 148, 25 S.E. 2d 436 (1943). See also L. Larson, Unjust Dismissal \u00a7 10.34 (1985 and Supp. 1987).\nPlaintiff does not fall within any of the well-recognized exceptions to the general rule that an employment contract of indefinite duration is terminable at the will of either employer or employee. He contends, however, that this Court should join those jurisdictions in which an employer\u2019s personnel policy is incorporated by reference into an employment contract. See Annot., \u201cRight to Discharge Allegedly \u2018At Will\u2019 Employee as Affected by Employer\u2019s Promulgation of Employment Policies as to Discharge,\u201d 33 A.L.R. 4th 120, \u00a7\u00a7 3-4 (1984 and Supp. 1986); Note, Continued Resistance to Inclusion of Personnel Policies in Contracts of Employment, 62 N.C.L. Rev. 1326 (1984); Note, Employee Handbooks and Employment At Will Contracts, 1985 Duke L.J. 196 (1985); Parker, The Uses of the Past: The Surprising History of Terminable-at-Will Employment in North Carolina, 22 Wake Forest L. Rev. 167 (1987).\nSeveral cases decided by the Court of Appeals, and federal courts applying North Carolina law, hold that an employer\u2019s personnel manual is not part of an employee\u2019s contract of employment. Walker v. Westinghouse, 77 N.C. App. 253, 335 S.E. 2d 79 (1985), disc. rev. denied, 315 N.C. 597, 341 S.E. 2d 39 (1986) (handbook not part of employment contract, notwithstanding language that the handbook would \u201cbecome more than a handbook ... it will become an understanding\u201d); Smith v. Monsanto Corp., 71 N.C. App. 632, 322 S.E. 2d 611 (1984) (company policy not incorporated in employment contract); Griffin v. Housing Authority, 62 N.C. App. 556, 303 S.E. 2d 200 (1983) (defendant-employer\u2019s personnel manual not expressly incorporated into plaintiffs contract of employment); Williams v. Biscuitville, Inc., 40 N.C. App. 405, 253 S.E. 2d 18, cert. denied, 297 N.C. 457, 256 S.E. 2d 810 (1979) (operations manual unilaterally adopted by employer and could be changed; employer could discharge plaintiff in manner not set forth in manual); Rupinsky v. Miller Brewing Co., 627 F. Supp. 1181 (W.D. Pa. 1986) (applying North Carolina law). We have not been persuaded to depart from the rules developed and applied in our prior decisions.\nIt is noteworthy that in those jurisdictions in which statements in employment handbooks have been treated as binding on the employer, making the traditional rule of employment-at-will inoperative, the handbook, policy manual, or personnel manual contains an express representation that employees will be dismissed only for \u201cjust cause.\u201d Toussaint v. Blue Cross and Blue Shield of Michigan, 408 Mich. 579, 292 N.W. 2d 880, reh\u2019g denied, 409 Mich. 1101 (1980). Compare Weiner v. McGraw Hill, 57 N.Y. 2d 458, 443 N.E. 2d 441, 457 N.Y.S. 2d 193 (1982) (handbook indicated that employer would resort to dismissal for \u201cjust and sufficient cause only\u201d) with Sabetay v. Sterling Drug, Inc., 69 N.Y. 2d 329, 506 N.E. 2d 919, 514 N.Y.S. 2d 509 (1987) (personnel manual merely suggests standards for dismissal; employee fails to demonstrate express limitation on employer\u2019s unfettered right to discharge). See, L. Larson, Unjust Dismissal, \u00a7 8.02 (1985 and Supp. 1987).\nPlaintiff relies on Trought v. Richardson, 78 N.C. App. 758, 338 S.E. 2d 617, disc. rev. denied, 316 N.C. 557, 344 S.E. 2d 18 (1986). There, the plaintiff alleged, inter alia, that the hospital\u2019s policy manual provided that employees could be discharged only for cause; that when she was hired as a nurse, she was required to sign a statement that she had been read the policy manual; and that she had been discharged without cause. The Court of Appeals held that such allegations were sufficient to defeat defendant\u2019s motion to dismiss. While this Court has not addressed the issue presented in Trought and does not do so here, that case is readily distinguished from the case at bar by reason of the specific no-discharge-except-for-cause allegation in Trought. The management procedure in question here, and upon which plaintiff relies, contains no such express representation, and plaintiff does not so allege.\nPlaintiffs complaint alleges that he performed a particular weld or \u201ctack\u201d at the request of a fitter. This procedure was investigated by management employees, and plaintiff was then discharged for Class B and Class C violations. Plaintiff alleges that his actions in making the weld were, at most, a Class B (concealing defective work) violation.\nOn a motion to dismiss pursuant to Rule 12(b)(6), we treat the factual allegations of the complaint as if they were established. Sutton v. Duke, 277 N.C. 94, 176 S.E. 2d 161 (1970). Thus, for the purposes of review, deeming as true plaintiff s allegations that he specifically relied upon the terms of the management procedure in question in entering into employment with Duke, we hold that the trial court properly dismissed the complaint, because plaintiff does not allege, nor does the procedure contain, any promise or representation that employee will be subject to dismissal only for violations of specific Class A, Class B, or Class C offenses.\nPlaintiffs complaint also alleges, with respect to defendant\u2019s management procedure manual, that defendant represented to him that \u201cas long as he followed said rules he would not be terminated for violating said rules.\u201d From our detailed review of the management procedure relied upon by the plaintiff, we conclude that it could not be reasonably interpreted as a manual of rules of conduct to be followed by employees.\nThe six-page manual or pamphlet in question is labeled \u201cDuke Power Company Management Procedure Number 8901-0016 CONS 010; Subject: Rules of Conduct.\u201d The entire content of the manual is directed towards management personnel and relates solely to carrying out disciplinary actions against employees. In the prefatory statement, which describes the Construction Department\u2019s rules relating to disciplinary action, the procedure states:\nThe Construction Department\u2019s rules are limited to the basic m\u00ednimums necessary for orderly and efficient operations. They are not intended to be all-inclusive. They serve as examples of the types of offenses that require disciplinary action.\nThe section labeled \u201cRules of Conduct\u201d categorizes or classifies disciplinary action offenses as \u201cClass A,\u201d \u201cClass B,\u201d or \u201cClass C.\u201d These classes of offenses are said to \u201cprovide a general framework for taking consistent corrective action.\u201d Class A offenses are the least serious and will result in discharge after the third offense, if warranted upon review; Class B offenses are more serious and will result in discharge after the second offense, if warranted upon review; Class C offenses are the most serious and will result in discharge after the first offense, if warranted upon review.\nAs already noted, the pamphlet referred to was labeled a management procedure', it contains no rules by which employees are to conduct themselves; it thus sets forth no manner by which plaintiff could have \u201cfollowed said rules,\u201d without being a management employee charged with carrying out the disciplinary procedures specified therein. Indeed, rather than setting out rules of conduct by which employees are to conduct themselves in their work, it contains descriptions of acts which are prohibited; uses the terms \u201coffenses,\u201d \u201cviolations,\u201d etc.; provides for \u201cwarnings\u201d; and instructs the reader as to how to word the warnings and notices of disciplinary action and where to file and how to distribute them. Therefore, even taking plaintiffs allegation as true \u2014 that defendant represented that he would not be terminated if he followed the \u201cRules of -Conduct\u201d \u2014 he fails to state a cause of action, because the \u201cRules of Conduct,\u201d under the most liberal reading, set forth no rules for plaintiff to follow.\nFor the foregoing reasons, we affirm the judgment of the Court of Appeals.\nAffirmed.",
        "type": "majority",
        "author": "MEYER, Justice."
      },
      {
        "text": "Chief Justice EXUM\nconcurring.\nI do not understand the Court to hold that personnel policy manuals distributed, or personnel policies explained, to employees by employers can never be part of the contract of employment binding on the employer. Rather I read the Court\u2019s opinion to say that the \u201cManagement Procedure\u201d brochure relied on by plaintiff and attached to the complaint cannot in law be a part of plaintiffs employment contract because the brochure makes no promises, express or implied, to defendant\u2019s employees. Rather the brochure because of its unambiguous, plain terms is as a matter of law a guide for defendant\u2019s managers, creates no benefits for defendant\u2019s employees, and imposes no limitations on defendant\u2019s power to discharge plaintiff at will. Neither could the plaintiff reasonably rely on the brochure as limiting the circumstances under which he could be discharged. I concur in the Court\u2019s legal construction of the brochure and in the result reached on the basis of that construction.\nIn my view an employer\u2019s personnel policies, if couched in language that either expressly or by implication makes promises to employees, may bind the employer to these promises and restrict the employer\u2019s power to discharge even if the policies are unilaterally promulgated and are supported by no consideration apart from the employee\u2019s acceptance or continuation of employment. See Trought v. Richardson, 78 N.C. App. 758, 338 S.E. 2d 617, disc. rev. denied, 316 N.C. 557, 344 S.E. 2d 18 (1986); Pine River State Bank v. Mettille, 333 N.W. 2d 622 (Minn. 1983); Toussaint v. Blue Cross and Blue Shield of Michigan, 408 Mich. 579, 292 N.W. 2d 880, reh\u2019g denied, 409 Mich. 1101 (1980); see generally, Note, Employee Handbooks and Employment at Will Con tracts, 1985 Duke L.J. 196 (1985). I do not understand our decision today to hold to the contrary.\nJustice Martin joins in this concurring opinion.",
        "type": "concurrence",
        "author": "Chief Justice EXUM"
      }
    ],
    "attorneys": [
      "Russell & Sheely, by Michael A. Sheely, and Edelstein & Payne, by M. Travis Payne, for plaintiff-appellant.",
      "Mullins & Van Hoy, by Philip M. Van Hoy, and Duke Power Company Legal Department, by Robert M. Bisanar, for defendant-appellee.",
      "Ogletree, Deakins, Nash, Smoak and Stewart, by Stuart M. Vaughan, Jr., for North Carolina Associated Industries, amicus curiae."
    ],
    "corrections": "",
    "head_matter": "TONY C. HARRIS v. DUKE POWER COMPANY, a corporation\nNo. 697A86\n(Filed 2 June 1987)\nMaster and Servant \u00a7 10.2\u2014 wrongful discharge \u2014 violation of management policy manual \u2014 not applicable to employees\nIn an action in which plaintiff alleged that he had been wrongfully discharged without cause in violation of defendant\u2019s termination policy as stated in its management procedure manual, the trial court did not err by granting defendant\u2019s motion for dismissal under N.C.G.S. \u00a7 1A-1, Rule 12(b)(6), where plaintiff did not allege that the management manual upon which he relied contained any promise or representation that an employee would be subject to dismissal only for violations of specific Class A, Class B, or Class C offenses, and the manual was directed toward management personnel and could not be reasonably interpreted as a manual of rules of conduct to be followed by employees.\nChief Justice Exum concurring.\nJustice Martin joins in the concurring opinion.\nBEFORE Saunders, J., at the 27 January 1986 Session of Superior Court, MECKLENBURG County, the court granted defendant\u2019s motion to dismiss pursuant to Rule 12(b)(6) of the North Carolina Rules of Civil Procedure. A divided panel of the Court of Appeals affirmed, 83 N.C. App. 195, 349 S.E. 2d 394 (1986). Plaintiff appeals to this Court pursuant to N.C.G.S. \u00a7 7A-30(2) and Rule 14(a) of the Rules of Appellate Procedure, based on a dissent in the Court of Appeals. Heard in the Supreme Court 16 April 1987.\nRussell & Sheely, by Michael A. Sheely, and Edelstein & Payne, by M. Travis Payne, for plaintiff-appellant.\nMullins & Van Hoy, by Philip M. Van Hoy, and Duke Power Company Legal Department, by Robert M. Bisanar, for defendant-appellee.\nOgletree, Deakins, Nash, Smoak and Stewart, by Stuart M. Vaughan, Jr., for North Carolina Associated Industries, amicus curiae."
  },
  "file_name": "0627-01",
  "first_page_order": 659,
  "last_page_order": 666
}
