Burke v. Ceridian CV-07-207-JL 9/2/08 UNITED STATES DISTRICT COURT DISTRICT OF NEW HAMPSHIRE

John Burke

v. Civil No. 07-cv-00207-JL Opinion No.

Ceridian Corporation

O R D E R

John Burke, a Hudson, New Hampshire resident formerly

employed at the Boston office of Ceridian Corporation, has sued

Ceridian through a four-count amended complaint alleging age

discrimination and violation of

(2001) and

N.H. Rev. Stat. Ann. 354-A:7 (1995 & Supp. 2007), as well as

state law claims alleging tortious interference with business

relations, wrongful discharge, and breach of contract.

This court has jurisdiction under

(2001)

(federal question) and specifically,

(civil

action for age discrimination).

Ceridian has moved, under Rule 1 2 (c) of the Federal Rules of

Civil Procedure, for judgment on the pleadings on Counts II

(tortious interference with business relations). III (wrongful

discharge), and IV (breach of contract). See F.R.C.P. 12(c)

(2008). Burke has conceded that Ceridian is entitled to judgment

on the pleadings on the tortious interference and wrongful discharge claims. After oral argument, and in consideration of

the parties' pleadings and their various arguments, for the

reasons set forth below, the court grants Ceridian's motion for

judgment on the pleadings as to the breach of contract claim.

I. APPLICABLE LEGAL STANDARD

A Rule 1 2 (c) motion for judgment on the pleadings is

evaluated under the same standard for deciding a Rule 12(b)(6)

motion for failure to state a claim upon which relief can be

granted. Pasdon v. City of Peabody,

(1st Cir.

2005); see also Perez-Acevedo v. Rivero-Cubano,

(1st Cir. 2008). In order to survive such a motion, the

"complaint must contain factual allegations that raise a right to

relief above the speculative level," Perez-Acevedo, 520 at 29

(quotations omitted), and "requires more than labels and

conclusions, and a formulaic recitation of the elements of the

cause of action will not do." Bell Atl. Corp. v. Twomblv, 127

S. C t . 1955, 1965 (2007); see also Papasan v. Allain,

(1986) (on a motion to dismiss, courts "are not bound to

accept as true a legal conclusion couched as a factual

allegation").1 Because a Rule 12(c) motion "calls for an

1 Until recently, the pleading standard for a motion to dismiss set a higher bar for the movant, requiring that the

2 assessment of the merits of the case at an embryonic stage," the

facts contained in the pleadings are constructed in the light

most favorable to the nonmovant and the court must draw all

reasonable inferences from those facts in the nonmovant's favor.

Perez-Acevedo,

. The following background facts

are set forth in accordance with this standard.

II. BACKGROUND

Ceridian, a provider of human resources software to

businesses, employed Burke as a sales representative on its

Boston-based sales team for 25 years. During that time, Burke

worked primarily from his home office in New Hampshire. When he

was discharged on November 29, 2004, Burke was 55 years old, the

oldest member of the Boston sales team.

For 16 of his 25 years at Ceridian, Burke received an award

given to Ceridian's top-performing sales representatives. From

complaint be maintained "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." See Conley v. Gibson,

(1957), abrogated by Bell A t l . Corp., 127 S. C t . at 1969. In 2007, however, the Supreme Court retired the "no set of facts" formulation in favor of the standard quoted above, which requires more of the nonmovant. Bell A t l . Corp., 127 S. C t . at 1969. This new pleading standard applies to both Rule 12(b)(6) motions to dismiss and Rule 12(c) motions for judgment on the pleadings. Perez-Acevedo,

.

3 1980 to 2000, Burke regularly met or exceeded his annual sales

quota. From 2001 to 2004, Burke was less successful in reaching

his annual sales quota, due to various factors, including: (1)

an unsuccessful experimental "selling approach" adopted by

Ceridian, (2) a lack of sales leads resulting from the new

approach, (3) a reduction in his geographical sales territory,

and (4) customer returns.

In early 2004, Burke's supervisor, John O'Donnell, notified

Burke in writing that his sales quota and "call activities" were

not at an acceptable level, and placed Burke on a "Success Plan"

listing goals Burke was to achieve by February 27, 2004.2

According to the "Success Plan," if the goals were not achieved,

Burke would face disciplinary action, possibly including

termination. According to the complaint, Burke met the specified

goals, and O'Donnell "took him off the plan" in February, 2004.

In 2004, O'Donnell continued in his position as Vice

President of Sales, but assigned Stephen Gardner to directly

supervise Burke. Shortly after he began supervising Burke,

Gardner expressed concerns about Burke's performance, but told

2 The goals, according to Burke's complaint, included a minimum of 100 telephone "dials" for appointments per week, a minimum of two new "prospect appointments" per week, two "direct mails to territory prospects" per month, scheduling his manager for a minimum of two new calls per month, and prior approval of his weekly activity calendar by a superior.

4 Burke that he would not take disciplinary action for 60 days to

allow him to better understand Burke's performance. In

September, 2004, Gardner placed Burke on another "Success Plan"

because he had only attained 46% of his annual sales quota. Like

the original plan, this one outlined goals Burke was to achieve

by October 4, 2004, or face disciplinary action, possibly

including termination.3 Burke achieved some of the goals under

the second "Success Plan," but made no sales.

On October 11, 2004, Ceridian placed Burke on a "Performance

Improvement Plan" (PIP). The document memorializing the PIP

stated that Burke's sales attainment at that time was 41%, and it

listed goals more rigorous than those set forth under the

"Success Plans." Significantly, Burke does not allege in his

complaint that the documents memorializing the PIP, or any of his

superiors at Ceridian, promised him continued employment with

Ceridian for any definite or indefinite term in connection with

Burke's attainment of the PIP's listed goals. He also does not

allege that there was a promise of continued employment with

3 According to the complaint, the "plan included 50,000 Sales Order Values for September, a minimum of 80 telephone dials for appointments per week, a minimum of three face to face appointments per week, two direct mails to territory prospects per month, submission of a pre-approved weekly activity calendar, and a funnel of two times his monthly sales quota, etc. 'Funnel' or 'pipeline' are terms used to indicate promising sales prospects."

5 Ceridian while pursuing the goals. Burke partially satisfied the

PIP's listed goals, but again, closed no sales. On November 8,

2004, the PIP was renewed and extended until December 4, 2004, in

a document that noted that Burke's attainment rate on his annual

sales quota was 36%.

Ceridian terminated Burke's employment on November 29, 2004,

citing poor performance as the reason for termination. Burke's

complaint alleges that Gardner conveyed, and O'Donnell approved,

the termination and that both Gardner and O'Donnell knew that

"Burke had a pipeline" (promising sales prospects) in excess of

his annual sales quota.

Burke's complaint alleges that in 1994, O'Donnell gave him

the nickname "Repasaurus," intending to convey that Burke was, at

that time, the oldest sales representative on the Boston sales

team, and that the nickname stuck. In fact, the "Repasaurus"

moniker was invoked during Ceridian's 2004 annual sales meeting,

at which Burke was "honored" for his 25 years of employment with

the company. Burke's complaint alleges that the nickname

reflected the prevailing mindset at Ceridian that those of

Burke's age were ready for "extinction." The complaint further

alleges that O'Donnell and Gardner directed promising sales leads

to "new sales representatives much younger than Burke," and that

all of his accounts were redistributed to younger members of the

6 Boston sales team. His complaint alleges that representatives of

significant customers landed by the Boston sales team after

Burke's termination were prepared to testify that Burke had been

critical in their decisions to purchase software from Ceridian.

Finally, Burke alleges that as of December, 2004, Ceridian's

Boston sales team had members with ages ranging from 31 to 55,

with an "average age" of 40. As of January, 2007, Burke alleges,

the ages ranged from 31 to 46, with an "average age" of 38. He

further claims that at the time of his termination, approximately

120 other Ceridian sales representatives, "most of whom were

under 40 years old," were performing at levels below Burke's, but

were not terminated, and that he was replaced on April 4, 2005,

by a 40 year old individual. Finally, Burke adds that the Boston

group's second-oldest sales representative was terminated in

2007 .

II. ANALYSIS

A. Breach of contract

Count IV of Burke's complaint alleges a breach of contract

claim. Ceridian argues that judgment should be entered in its

favor on the pleadings because "Burke has simply failed to allege

any express or implied contractual undertaking by Ceridian (not

subsumed by his wrongful discharge claim as an at-will employee)

7 that has been breached by Ceridian." In other words, Ceridian

argues, Burke was at all times an at-will employee, and he has

not alleged any facts that amount to the creation of an

employment contract or contractual term that it could have

breached. Burke counters that Ceridian's imposition of

"performance plans" like the "Success Plans" and the PIPs, and

his acceptance of those plans through his continued employment

with Ceridian, constituted contractual arrangements breached by

Ceridian when it terminated him before he was able to close the

sales in his "pipeline."

"Under the common law of New Hampshire, a breach of contract

occurs when there is a failure without legal excuse to perform

any promise which forms the whole or part of a contract."

Sabinson v. Trustees of Dartmouth College, 2 007 DNH 141, 47

(brackets and quotations omitted) (quoting Bronstein v. GZA

GeoEnvironmental, Inc.,

(1995)). Of course,

this presupposes the existence of a contract, the essential

elements of which are offer, acceptance, consideration, and a

meeting of the minds. See Tsiatsios v. Tsiatsios,

(1995).

"As a general rule, the interpretation of a contract is an

issue of law for this court to resolve." Dillman v. New

Hampshire College,

(2003) (citing Erin Food Servs., Inc. v. 688 Props.,

(1979)). "Where,

however, there are disputed questions of fact as to the existence

and terms of a contract, they should be resolved by the jury."

Dillman,

(emphasis added) (citing Malonev v.

Boston Dev. Corp.,

(1953)). Even so, "[b]efore

such issues can be submitted to the jury, the trial court must

determine whether there is any evidence from which a reasonable

jury could find a contract between the parties." Dillman,

. In the context of a Rule 12(c) motion for judgment

on the pleadings, this requires the court to scrutinize Burke's

Amended Complaint to determine whether it contains any

allegations from which a contract or contractual undertaking

could be discerned.

It is undisputed that, prior to Ceridian's imposition of the

"performance plans," Burke was an at-will employee. "Of course,"

as Burke points out, "an employer and an employee may alter the

at-will status of the employment relationship." Smith, 7 6 F.3d

at 426 (citing Butler v. Walker Power, Inc.,

(1993)). "Such a modification sometimes may be accomplished if

the employer makes a binding offer that the employee can accept

by remaining on the job." Smith, 76 F.3d at 426. To find

alteration of at-will status, however, the new contractual terms

must be definite so that there is reasonable certainty about the

9 contours of the new employment relationship. Id.; C f . Jesep v.

N.E. Health Care Quality Foundation, No. 04-CV-77-JD,

, at *7 (D.N.H. Apr. 27, 2005).

Burke argues that this is just such a situation, wherein

Ceridian offered Burke the opportunity to meet the goals as set

forth in the Success Plans and PIPs, and Burke accepted the offer

by continuing to work for Ceridian. This assertion, however,

mischaracterizes the terms of the four "performance plans." More

importantly, it ignores the fact that the Amended Complaint--the

basis for a Rule 1 2 (c) judgment on the pleadings analysis--makes

no allegation that the Performance Improvement Plans, in

particular, were accompanied by anything resembling a promise of

any kind, including one of continued employment. And Ceridian

could not identify any such PIP-memorialized promise at oral

argument.

Nor can any such promise be inferred from the fact that, at

the time of his termination, Burke was working subject to a

"PIP." Although the New Hampshire Supreme Court has held "that

continued service by an employee who was free to leave his job at

any time may be seen as consideration for an employer's offer to

modify employment terms favorably to the employee," Panto v.

Moore Bus. Forms, Inc.,

(1988) (emphasis added)

(citing Gilman v. County of Cheshire,

(1985)),

10 this is not such a case. Ceridian did not offer to modify

Burke's employment terms in a manner favorable to Burke; rather,

it put him on notice of goals it expected him to reach.4 And at

least with respect to the final PIP, during the pendency of which

Burke was terminated, the pleadings reveal no promise to continue

or extend his employment or refrain from terminating him. Cf.

Butler,

(absent a clear statement about change in

at-will status, a step discipline policy, although enforceable,

did not create tenure for employee).

Further, even if one were to accept the proposition that

each, or any, of the four "performance plans" contained an

implicit promise not to terminate Burke if he met the list of

performance goals by the required date, an employment contract

would not have been created, because it would not have altered

the at-will nature of Burke's employment as of the termination

date of each of the four plans. "A contract to reinstate an at-

4 At oral argument Burked argued that the "performance plans" could be viewed as terms, offered by Ceridian and favorable to him, because (1) Ceridian could have simply fired him instead of subjecting him to such a plan, and (2) the performance plans could be viewed as "guidance" in the performance of his duties. Court IV (the breach of contract count) of his complaint, however, unambiguously characterizes the performance plans as "unreasonably demanding," (Am. Comp. 583), and inferentially noted that not placing other employees on such plans amounted to favorable treatment for them. (Id., 582) . The performance plans did not offer terms favorable to Burke.

11 will employee to an at-will position (from which she could

immediately be removed without cause) is no contract at all."

Smith, 76 F.3d at 426 (citing E. Allan Farnsworth Contracts §§

2.13, 2.14 (2d ed. 1990) (explaining that promises to maintain an

at-will relationship are illusory)).

Because this court concludes that imposition of any or all

of the multiple performance plans did not modify Burke's at-will

employment status, it grants Ceridian's 12(c) motion on this

count.

IV. CONCLUSION

Accordingly, Ceridian's motion for judgment on the pleadings

is granted as to Count II (tortious interference with business

relations, with respect to which Burke confessed judgment), Count

III (wrongful discharge, with respect to which Burke confessed

judgment), and Count IV (breach of contract). Burke may proceed

on the statutory age discrimination claim set forth in Count I in

the normal course.

SO ORDERED.

12 Dated: September 2, 2008

cc: Scott H. Harris, Esq. Michael J. Kenison, Esq. Jill K. Blackmer, Esq. Martha Van Got, Esq.

13