ZOTOS v. TOWN OF SOUTHBRIDGE (2020)

MEMORANDUM AND ORDER PURSUANT TO RULE 1:28

Paul W. Zotos, a former employee of Southbridge (town), brought suit against the town for a breach of employment contract. He alleged that the town's revised personnel regulations (regulations) created a de facto employment contract and that his dismissal did not comport with those regulations. The complaint was dismissed in the Superior Court, where the judge found Zotos was an at-will employee and the regulations did not create an employment contract. We affirm.

Background. Zotos had been employed as the town's cable coordinator from 2002 until 2011. He did not have a formal written employment contract. On October 5, 2011, the town served him with a document styled as a “Notice of Contemplated Termination” that listed various reasons for terminating his position and offered a scheduled time to meet with the town manager to discuss the notice.² The meeting took place on October 7, where Zotos was represented by counsel. Six days later, Zotos received a termination notice from the town.³

As a result, Zotos filed a grievance with the town claiming that his termination was (1) not in accordance with town regulations, (2) based upon “illegal procedure,” and (3) given without just cause. He stated that he was entitled to file the grievance under the regulations.⁴ The town, without waiving any of its rights, wrote a letter in response stating that the regulations did not apply to Zotos because he was a “department head.” ⁵ Zotos responded with a letter requesting arbitration and again asserting that the regulations applied to him.⁶ The town did not reply to that letter, nor to Zotos's subsequent December arbitration request.

On January 13, 2017, more than five years after his last request for arbitration, Zotos filed the underlying complaint in the Worcester Superior Court. An amended complaint was filed on April 20.⁷ In it Zotos alleged that the town breached the “contract” by (1) not including findings of fact or “reasons” for termination in its notice of termination and (2) failing to follow the grievance and arbitration procedure. The complaint was dismissed for failure to state a claim.

Discussion. “We review the allowance of a motion to dismiss de novo,” accepting the allegations in the complaint as true and drawing all reasonable inferences in the plaintiff's favor. Curtis v. Herb Chambers I-95, Inc., 458 Mass. 674, 676 (2011). Here, the central question is whether the town's regulations applied to Zotos in such a way that created an employment contract.⁸ We conclude that they did not.

“To prevail on a claim for breach of contract, a plaintiff must demonstrate that there was an agreement between the parties; the agreement was supported by consideration; the plaintiff was ready, willing, and able to perform his or her part of the contract; the defendant committed a breach of the contract; and the plaintiff suffered harm as a result.” Bulwer v. Mount Auburn Hosp., 473 Mass. 672, 690 (2016). A personnel manual may form the basis for an express contract depending on the circumstances of the particular employment relationship or if the employer and employee agree that the manual becomes part of the employment contract. O'Brien v. New England Tel. & Tel. Co., 422 Mass. 686, 691-692 (1996). Generally, however, “where an employment contract, be it express or implied, contains no definite period of employment, it establishes employment at will,” which is “terminable by either the employee or the employer without notice, for almost any reason or for no reason at all.” Jackson v. Action for Boston Community Dev., Inc., 403 Mass. 8, 9 (1988).

Here, Zotos's failure to plausibly allege that the regulations created an employment contract is fatal to his claim.⁹ He argues that the motion judge's finding “completely overlooks” the town's response to his grievance request, where the town asserted that the regulations did not apply because Zotos was not a department head. We disagree. The town's response to the grievance request cannot fairly be viewed as suggesting that the regulations created a contract where the letter also “unequivocally reject[ed] the allegations contained in the grievance” and clearly asserted that the regulations did not apply. Beyond resting on the correspondence, Zotos alleged no offer, consideration, or acceptance as outlined supra. See Bulwer, 473 Mass. at 690. Thus, the judge was correct to dismiss Zotos's complaint.

We also note that, assuming arguendo that the regulations did in fact create an employment contract, those regulations nevertheless provide no safe harbor for Zotos's complaint. When interpreting contracts, plain and unambiguous words must be construed in their ordinary sense. Cady v. Marcella, 49 Mass. App. Ct. 334, 338 (2000). Here the regulations describe the grievance process as follows: “The employee who feels that he has received inequitable treatment because of some condition of employment may personally, or through his representative, appeal for relief from that condition.” The regulations also limit the grievance process to “issues ․ having to do directly and primarily with the day-to-day working life of the employee and relationships with his supervisor.” Zotos argues that an employee's termination is a day-to-day concern. In this context we are not persuaded. Given that the regulations explicitly exclude salary considerations, it is clear that the grievance process is intended to govern working conditions and concerns. Simply put, being terminated from a job is not part of the daily “condition[s] of employment” from which an employee would “appeal for relief” in the ordinary sense of those words. If the grievance process was intended to cover terminations, such language could have easily been included within the regulations. It was not.

Judgment affirmed.

FOOTNOTES

2.   The notice of contemplated termination lists “some of the substantiated complaints received regarding [Zotos's] behavior.” Among other things, they included failing to follow a clear directive, working with members of the town council on political activities, airing footage damaging to the town during town council meetings, and allowing noncable related individuals to share office space.

3.   The termination notice did not independently list reasons for his dismissal but referenced the October 5 notice of contemplated termination.

4.   Zotos asserted that he was entitled to file a grievance pursuant to §§ 11.2.1, 11.2.3, and 11.2.5 of the regulations. Section 11.2.1 provides as follows: “GRIEVANCE RIGHTS OF EMPLOYEES: The employee who feels that he has received inequitable treatment because of some condition of his employment may personally, or through his representative, appeal for relief from that condition. It is understood that issues involving the increase or decrease of general wage rates or salaries and issues not having to do directly and primarily with the day-to-day working life of the employee and relationships with his supervisor shall not be considered the subject of a grievance and consequently shall not be the subject of any arbitration.” Section 11.2.3 provides that a grievance shall be forwarded to the department head within seven days of the relevant supervisor's response. Similarly, § 11.2.5 provides that where a grievance still remains unsettled, the employee will forward it to the town manager within seven days of the department head's decision.

5.   The town asserted that the regulations cited by Zotos “provide for disciplinary action and a grievance procedure for employees who hold positions in the service of the Town below the level of ‘Department Head.’ ” In support of that position, the town pointed to portions of the regulations that designated department heads as responsible for the enforcement of the regulations.

6.   Specifically, he argued that he was listed under the town's “classification and compensation plan” as a “clerical, administrative, professional and white-collar” position.

7.   On the same day, April 20, 2017, he filed a petition for arbitration with the American Arbitration Association. The judge did not discuss the town's claim that Zotos had not exhausted his administrative remedies and we need not reach that issue.

8.   Zotos now takes the position that he need prove only that he was a department head, because the town's response to his grievance letter insinuated that the regulations only applied to department heads. Although we note that the town also reserved all of its rights in the response, we pay no mind to this argument -- it is our interpretation of the regulations, not the town's, that controls.

9.   This includes any support for the idea that he was aware of the regulations or discussed them with the town prior to the start of his employment. See O'Brien, 422 Mass. at 692.