121 Lab.Cas. P 56,892,
John L. BROOKS, et al., Plaintiff-Appellant,
v.
HILTON CASINOS INCORPORATED, et al., Defendant-Appellee.
John L. BROOKS, Plaintiff-Appellee,
v.
HILTON CASINOS INCORPORATED, d/b/a Las Vegas Hilton, a
Nevada Corporation, et al., Defendant-Appellant.
John L. BROOKS, Frederick Amie, Norman V. Ballard, Jack A.
Bosarge, Robert A. Dawson, Douglas S. Delling,
Alan Kirk Drake, Roger H. Dudley, et
al., Plaintiffs,
and
Equal Employment Opportunity Commission,
Plaintiff-Intervenor-Appellant,
v.
HILTON CASINOS INCORPORATED, d/b/a Las Vegas Hilton, a
Nevada Corporation, Hilton Hotel Corporation,
Defendant-Appellee.
Nos. 90-15424, 90-15460 and 90-15623.
United States Court of Appeals,
Ninth Circuit.
Argued and Submitted April 2, 1991.
Decided March 12, 1992.
Larry L. Simms, Gibson, Dunn & Crutcher, Washington, D.C., and M. Kristina Pickering, Lionel Sawyer & Collins, Reno, Nev., for appellants-cross-appellees.
John C. McCarthy, Mary F. Richardson and James P. Stoneman II, John C. McCarthy and Associates, Claremont, Cal., and Brian Berman, Las Vegas, Nev., for appellees-cross-appellants.
John F. Suhre, E.E.O.C., Washington, D.C., for cross-appellant EEOC.
Appeal from the United States District Court for the District of Nevada.
Before: BOOCHEVER, KOZINSKI and O'SCANNLAIN, Circuit Judges.
KOZINSKI, Circuit Judge.
Plaintiffs, 37 dealers at Hilton's Las Vegas casino, were terminated as they came off their shifts on September 2 and 3, 1983. They sued and obtained jury verdicts on several state and federal law claims. Hilton challenges plaintiffs' recovery on a variety of grounds, but because of the way we resolve the state law issues we need not discuss the difficult federal and constitutional issues raised by Hilton in its appeal.
I. Breach of Contract and Bad Faith Discharge
Hilton challenges the damages awarded for breach of contract and bad faith discharge on the ground that plaintiffs were employed at will. We review the district court's determination of state law de novo. Salve Regina College v. Russell, --- U.S. ----,
Plaintiffs were not employed under a written employment contract. Under Nevada law, the absence of a written contract gives rise to the presumption that employment is at will. See Vancheri v. GNLV Corp.,
The Nevada Supreme Court has rejected claims of contractual employment based on very similar evidence. In Vancheri, the plaintiff was not employed under a written contract, but was told by management when he came to work that "he would have a long and successful association with the GNLV family."
Vancheri was never told that his employment would be terminated only for cause or that he would have employment for life or a specified period of time. General expressions of long term employment or job advancement do not convert an at-will employment contract to a termination only for cause contract.
Id. at 369. As to the second factor, it said:
Standardized disciplinary procedures are generally positive additions to a business. They provide employers a method of cautioning employees, and afford employees an opportunity to improve job performance in order to retain employment. They also create a general consistency and security in the work place. If we were to hold that the establishment of standard disciplinary procedures for employees is, in and of itself, sufficient to convert an at-will employee to an employee who can be fired only for cause, employers would be reluctant to continue to establish them.
Id. at 369-70. The court concluded that these two circumstances were, as a matter of law, insufficient to rebut the presumption of at-will employment. Id. at 370.
In Bally's Grand Employees' Federal Credit Union v. Wallen,
Like the plaintiffs in Vancheri and Bally's, plaintiffs here only offered evidence of their unilateral expectations, based on common employment policies that are compatible with either at-will or dismissal-for-cause-only employment. Generous benefit packages, disciplinary procedures and general expressions of encouragement by management are all generic features of many employment relationships.1 These factors are insufficient as a matter of Nevada law to rebut the presumption of at-will employment.2
Thus, the only factor which the jury properly could consider in deciding the employment contract question is whether Hilton management agreed to terminate the plaintiffs only for failure to perform satisfactorily.3 In American Bank Stationery v. Farmer,
Plaintiffs place great reliance on the fact that pit boss Art Castle testified that he told every dealer he hired "They'd have to get so far out of line that there would be no cause for action other than to terminate them." RT VI 140 (paraphrasing shift boss Bud Haines's purported policy). Read in context, however, this testimony does not support the plaintiffs' case. Castle testified that "[e]very time a dealer was hired in the place, I gave them this spiel, more or less. I called it a 'spiel'--that they were part of the Hilton family and that the only way they could be terminated was to terminate themselves." RT VI 139-40 (emphasis added). But every one of the plaintiffs was employed at the casino (then the International) before Hilton took over in 1972. See RT V 3. Thus Castle's statement doesn't help plaintiffs; there is no evidence that he gave them "this spiel."
Indeed, there is evidence from the plaintiffs' testimony that they were not told they would have a job as long as they performed satisfactorily. The following excerpts from the trial are typical:4
[Q:] "Do you know what Mr. Haines' policy was [regarding termination]?"
. . . . .
[A:] "You'd pretty much have to terminate yourself."
. . . . .
[Q:] "Did Mr. Haines ever directly tell you anything along those lines?"
[A:] "He never directly told, but I was very confident."
RT XII(A) 12 (Kustudia direct).
. . . . .
[A:] "It was the understanding that if you were to be terminated, you'd--if you were terminated, you'd terminate yourself.... That was just a feeling."
RT XII(A) 117 (Kustudia cross).
* * * * * *
[Q:] "Okay. At the time you were hired, you had no conversation with Mr. Haines about how long you would be employed. Is that true?"
[A:] "That's true."
[Q:] "And you had no discussions about the reasons for which you might be terminated. Is that true?"
[A:] "No, we had no discussions about--he gave me the list of rules. I assumed that if I followed all the rules and did my job properly, that I'd be okay."
RT XX 2-3 (Stanford cross).
* * * * * *
[Q:] "In other words he didn't say that you're going to work for Hilton until you drop dead or anything like that?"[A:] "He didn't say that. You had that impression--as long as you done your job, you always had a job."
[Q:] "Now, that phrase gets used a lot in these depositions. Did he say that to you?"
[A:] "I don't recall if he said it, it was like his policy."
[Q:] "Written?"
[A:] "I never seen it written."
[Q:] "Did you ever hear him say it?"
[A:] "Personally, no."
RT XXIII 153-54 (Neill deposition).
A generalized understanding of job security based on satisfactory performance cannot create an implied contract of employment. The Nevada Supreme Court has considered testimony strikingly similar to that in this case: "I understood as far as a contract between [the employer] and I that I--as long as I performed my duties, I would have a job." Bally's,
In fact, it appears that the plaintiffs only expected to continue in Hilton's employ, or assumed they would not be fired:
[Q:] "But you don't recall at any time anyone in management at Hilton saying that your job was secure as long as you perform satisfactorily, do you?"
[A:] "That was an insinuation."
[Q:] "But that was never said to you?"
[A:] "No, I never had any real discussion with management in that respect."
RT XXIII 36 (Hineline cross).
* * * * * *
[A:] "You assume when you take a job, that if you do your job, you're going to work there forever. That's just an assumption I think everyone in the world has."
RT XXIII 78 (Rexroad cross).
* * * * * *
[Q:] "Did you have an understanding as to why you could be fired from your job?"
[A:] "Well, the general understanding was that if you didn't do your job."
RT XIII(A) 29 (Newman direct).
The Nevada Supreme Court has clearly stated, however, that "[c]ontracts of employment cannot be created by the subjective expectations of an employee." Vancheri,
Some of the plaintiffs had a slightly different version of the "Haines policy":
[A:] "... John Stewart ... assured me personally that I was doing a very good job, he was very happy with my work, and I had a job at the Hilton as long as I wanted one."
. . . . .
[A:] "Bud Haines told me pretty much the same thing.... [H]e said that I would have a job at that hotel or with Hilton as long as I wanted one."
RT XXVI(A) 6-7 (Drake direct).
* * * * * *
[A:] "I took the job, I assumed if I did my job in the way that they wanted me to, that I would keep the job as long as I wanted it."
RT X 31 (Saunto direct).
The Nevada Supreme Court has held that an employee's expectation of working as long as he wants is probative of an at-will relationship: Because the employee is free to leave any time before then, the employer can fire him at will. Bally's,
Furthermore, it is doubtful whether statements such as the "Haines policy" can support an implied contract at all. The Washington courts have explicitly held otherwise. Lawson v. Boeing Co.,
A fair number of the plaintiffs were told nothing at all. The following exchanges are representative:
[Q:] "At the time Hilton bought [the International], did Mr. Newman say anything to you about how long you could expect to work for Hilton?"
[A:] "No, sir."
[Q:] "Or why you could be fired by Hilton?"
[A:] "No, sir."
[Q:] "Did Mr. Haines say anything like that to you?"
[A:] "No."
[Q:] "Either about how long you could expect to work or why you could be fired?"
[A:] "No, sir."
[Q:] "Nobody said anything like that to you? "
[A:] "No, sir."
RT XXXV 26 (Shailer deposition).
* * * * * *
[Q:] "And when Hilton acquired the International, they also, neither Mr. Newman or Mr. Haines--neither of them said anything to you on [how long your job was going to last or the reasons you could be terminated]?"
[A:] "No."
[Q:] "And at anytime after that at the Hilton, and anytime during your employment at the Hilton, none of your supervisors said anything to you about how long your employment was going to last, did they?"
[A:] "No."
[Q:] "Or what the reasons you could be fired were?"
[A:] "No."
[Q:] "And you also never read any documents that discussed either of those subjects, right?"
[A:] "That's right."
[Q:] "And otherwise, other than what anybody might have told you or what was in any document, other than that, you didn't have any independent understanding as to how long your employment was going to last?"
[A:] "No, I was never told anything."
RT XXXIV 17 (Zarro cross).
The Nevada Supreme Court has held on similar facts that the employees were employed at will. Smith,
Finally, some of the plaintiffs expressly recognized the at-will nature of the employment relationship:
[Q:] "Prior to the time of your termination from the Hilton, did you believe that Mr. Kelly could fire you for no reason?"
[A:] "Yes. That's why I was concerned."RT XVIII(A) 50-51 (Dudley deposition).
. . . . .
[Q:] "So you understood ... that Mr. Kelly had the right to fire you for whatever reason?"
[A:] "Oh, I would guess so, yes. Yeah. Whether he had the right or not, I certainly believe he could terminate people."
RT XVIII(A) 51 (Dudley cross).
* * * * * *
[Q:] "Are you saying that you continued to rely upon the fact that as long as you did your job you had a job?"
[A:] "I relied on my own ability to do my job to maintain my job."
RT XI(A) 9 (Saunto direct).
. . . . .
[A:] "My job at that time was in the hands of the Hilton Corporation."
RT X 108 (Saunto direct).
Where the employees themselves acknowledge that they hold their jobs only by the employer's good graces, it cannot seriously be argued that an implied for-cause contract exists.
Almost a century ago, Oliver Wendell Holmes wrote a passage that bears frequent repetition: "[T]he making of a contract depends not on the agreement of two minds in one intention, but on the agreement of two sets of external signs,--not on the parties having meant the same thing but on their having said the same thing." The Path of the Law, 10 Harv L Rev 457, 464 (1897). This salutary principle has been adopted by the Supreme Court of Nevada as the governing law of employment disputes. Hotel Riviera, Inc. v. Torres,
The jury was charged to consider the contract issue as to the plaintiffs collectively. The evidence was overwhelming that defendant was silent on the grounds for termination. Bud Haines's fire yourself policy was a general understanding rather than a term of the agreement at the time of employment. It may even have expressed indefinite employment, which is indicative of an at-will relationship. In any event, the plaintiffs' subjective expectations cannot transform employment at will into a for-cause relationship. And many of them were told nothing about the terms of employment, leaving Nevada's at-will presumption firmly in place. Some even recognized explicitly the at-will nature of their employment. As a matter of Nevada law, the plaintiffs were employed at will and therefore could be dismissed at will.5
It's true that a few of the plaintiffs testified that Haines or another manager told them that they would have their job as long as their performance was satisfactory. As noted, we have recently held a nearly identical statement insufficient as a matter of Washington law to create a jury question on the existence of an implied contract. Smoot,
The Nevada Supreme Court's most recent employment decision, D'Angelo, does nothing to alter this analysis. In that case, the court recognized that there can be implied employment contracts, and held on the facts before it that the plaintiff had presented sufficient evidence to go to the jury on the issue.
Nor can they recover in tort. It may be true that Hilton's stated reasons for firing the employees do not square completely with the facts. But Hilton was not required to give any reason at all for its action. "[A] bad faith discharge tort cannot be committed against an at-will employee...." D'Angelo,
Because plaintiffs were employed at will, Hilton was entitled to discharge them at will. They cannot maintain a cause of action under Nevada law for breach of contract or bad faith discharge. Sands Regent,
II. Intentional Infliction of Emotional Distress
Because plaintiffs were at-will employees, Hilton was entitled to terminate them without cause. Hence, their discharge did not amount to the type of willful misconduct that could serve as a predicate for the tort of intentional infliction of emotional distress. See Alford v. Harolds Club,
Even had plaintiffs managed to establish that the terminations were wrongful, Nevada does not recognize a cause of action for intentional infliction of emotional distress in the employment termination context. Plaintiffs point to MGM Grand Hotel-Reno, Inc. v. Insley,
III. Punitive Damages
Hilton argues that plaintiffs are not entitled to punitive damages as a matter of Nevada law. It also raises constitutional challenges to the punitive damages award. We hold that the award was improper under Nevada law and therefore do not reach the constitutional issues.
Under Nevada law, a punitive damages award must be based on a cause of action sounding in tort. Sprouse v. Wentz,
IV. Group Determination of Liability and Damages
Hilton argues that allowing the jury to determine liability and damages on a group basis for the contract and tort causes of action violated its seventh amendment right to a jury trial, as well as the Erie doctrine and the due process clause. Because of the way we have resolved the state law issues, see esp. pages 764-765, supra, we need not reach this difficult question.
V. ERISA Preemption
Hilton argues that plaintiffs' state law claims are preempted by the Employment Retirement Income Security Act (ERISA), 29 USC § 1001 et seq, the federal statute that governs employee benefit plans. We need not reach this issue because we have struck down the state law damage awards on other grounds.
VI. ADEA Issues
The EEOC raises two issues regarding the damages awarded under the ADEA. First, it argues that plaintiffs should have been awarded liquidated damages in addition to back pay. Second, it argues that the district judge erred in refusing to allow the jury to award front pay. Because we have struck down the punitive damages award, these issues are easily resolved on the basis of concessions made by Hilton and the EEOC.
A. Liquidated Damages
The jury found that Hilton's ADEA violation was willful, CR 441, Question 1A, yet did not award liquidated damages under 29 USC § 626(b). Plaintiffs and the EEOC argue that liquidated damages are mandatory once a willful violation is found. We need not resolve this issue because Hilton has made the following concession:
Because it is impossible to tell whether the punitive damages award contains a hidden award of federal liquidated damages, Hilton concedes that it would be appropriate, if the punitive damage award is reversed or remitted below $1,427,048.00 [the amount of back pay awarded to the ADEA plaintiffs], for this Court to reinstate that award up to that amount in order to ensure that the jury's finding of willfulness, which Hilton does not contest here, is implemented according to the ADEA's statutory purposes.
Hilton's Brief in Reply to the Responsive Brief of Plaintiffs and in Response to the Briefs on Cross-Appeal of Plaintiffs and the EEOC, at 87 n. 52. Accordingly, liquidated damages should be awarded in this case; the ADEA plaintiffs' back pay award should be doubled.
B. Front Pay
Plaintiffs and the EEOC argue that the court erred in instructing the jury that it could not award front pay. The EEOC conceded in its brief, however, that "if the present verdict stands or if liquidated damages are awarded, the district court's failure to allow an award of future damages may not be an abuse of discretion under the law of this Circuit." Brief of the EEOC as Cross-Appellant, at 13 n. 19. We have ruled that plaintiffs must be awarded liquidated damages. Because plaintiffs will be getting double back pay, we conclude that the district court did not abuse its discretion in declining to award front pay. See Cancellier v. Federated Dep't. Stores,
VII. Plaintiff Foltz
Plaintiff Foltz challenges the sanctions imposed by the district court for his refusal to provide information regarding his income, taxes and employment during the discovery process. He argues that the sanctions were improper because he based his refusal on the fifth amendment privilege against self-incrimination. In the alternative, he argues that the sanctions were excessive.
We undertake a two-part inquiry in reviewing a discovery sanction when the party has asserted a fifth amendment privilege: "(1) did the party resisting discovery properly assert his Fifth Amendment privilege, and (2) if not, did the district judge abuse his discretion in imposing the sanction involved." Davis v. Fendler,
Applying the first part of this test, we find that Foltz did not have a fifth amendment privilege concerning the requested information and records. Foltz' concern is that disclosure of this information might have subjected him to prosecution for tax crimes. But the fifth amendment's self-incrimination clause does not give taxpayers a right to withhold financial information from the IRS unless they can show an appreciable possibility of prosecution for a non-tax crime. Fuller v. United States,
Since Foltz could not assert the fifth amendment vis-a-vis the IRS directly in the civil discovery context when he faced the possibility of incriminating himself with regard to tax crimes, it is difficult to see how he could have a fifth amendment privilege vis-a-vis third parties. Foltz cites no authority for such a privilege and it is doubtful that any such authority exists. Plaintiffs who voluntarily come into court and seek economic damages must be prepared to prove their economic loss: "The scales of justice would hardly remain equal ... if a party can assert a claim against another and then be able to block all discovery attempts against him by asserting a Fifth Amendment privilege to any interrogation whatsoever upon his claim." Lyons v. Johnson,
Although sanctions were appropriate because Foltz did not have valid reasons for resisting discovery, we conclude that the sanctions imposed in this case were excessive. The district judge shut Foltz out of any recovery.10 This was an abuse of discretion because Foltz only withheld information that pertained to his claims for economic loss. His refusal did not prevent the jury from assessing his claims for emotional distress, punitive damages or reinstatement to the pension plan. Hence, the court was justified in determining that he could not recover economic damages such as back pay, but erred in barring him from other relief. We have overturned the punitive damages and emotional distress awards, but Foltz must be reinstated to the pension plan.
VIII. Plaintiff Delling
Plaintiff Delling contests the district court's factual finding regarding the date he became disabled.11 The court found that Delling became disabled on October 15, 1985, and would have left Hilton's employ on February 20, 1986. Delling contends that the correct disability date is June 1, 1986.
We conclude that this factual determination had adequate support in the record. The district court adopted the disability date used by Hilton's expert economist in a report on plaintiffs' damages. Exhibit B-L, at 2. The expert based this date on a statement of Delling's earnings record produced by the Social Security Administration. Id at 14, n. 5. Delling argues that his trial testimony establishes the later date. His trial testimony, however, mentions several possible disability dates. For purposes of obtaining unemployment benefits, he claimed that he was disabled as early as September 1984. RT XXXII(A) 53-54. He later applied for social security disability benefits and claimed that the onset of his disability was in 1985. Id at 56-58. He also testified that he considered himself to be totally disabled and not able to work after a hospitalization in the middle of 1986. Id at 45-46. He concedes that he did not in fact work after August 1985, when he was fired from a taxi driver job because he could not lift luggage. Brief of appellees/cross-appellants, at 83 n. 98.
Considering all the evidence, the district court's finding that Delling became disabled on October 15, 1985, was not clearly erroneous.
Conclusion
Plaintiffs were victims of age and sex discrimination and will recover damages under Title VII and the ADEA. The plaintiffs who recovered under the ADEA are also entitled to liquidated damages. Plaintiffs are not entitled to additional contract or tort damages under Nevada law. The awards for breach of contract and bad faith discharge, emotional distress and punitive damages are vacated. Plaintiff Foltz is entitled to reinstatement to the pension plan.
The judgment is REVERSED and the case is REMANDED for entry of judgment consistent herewith.
BOOCHEVER, Circuit Judge, concurring and dissenting Nos. 90-15424, 90-15460 and 90-15623
The principal issue presented by this appeal is whether there was sufficient evidence to present a jury question regarding an implied contract of employment between the Las Vegas Hilton and its 37 fired employees. Because it misconstrues Nevada law in resolving this issue, the majority dismisses categorically several types of evidence which the jury properly considered. The majority also mischaracterizes the evidence consisting of Hilton's numerous assurances to plaintiffs that they would be terminated only for cause, as nothing more than the plaintiffs' subjective expectations or a few "stray statements." Not only do I believe that the totality of the facts support a triable issue which was properly submitted to the jury, but I fear that the majority's interpretation of Nevada law regarding implied contracts seriously erodes the factfinding function of the jury. I respectfully dissent.
I.
Under Nevada law, the at-will presumption may be rebutted by evidence of an implied contract of employment. See Bally's Grand Employees' Fed. Credit Union v. Wallen,
The factfinder may consider various types of evidence in determining whether an implied "for-cause" employment contract existed. An employee handbook or detailed procedures for discipline and dismissal of employees may be evidence of an enforceable contract. See Southwest Gas Corp. v. Ahmad,
Here, the plaintiffs' evidence included: (1) the longevity of their employment, ranging from 11 to 17 years; (2) a written handbook setting forth rules providing the basis for discipline and termination; (3) Hilton's practice of giving written warnings before terminating employees; (4) statements by Hilton management that the plaintiffs would have their jobs, so long as they performed their jobs satisfactorily; (5) promises by Hilton management following layoffs in 1982 and 1983, that "there will be no more layoffs" and "no more terminations"; (6) assurances of job security when discouraging a union organizing effort; and (7) statements that the plaintiffs were part of "the Hilton family." Under Nevada law, the totality of the circumstances presented by the evidence raised a question of fact for the jury to decide whether there was an implied contract of employment.
A. Evidence Other Than Hilton's Representations
The majority dismisses several types of relevant evidence, by concluding that general expressions of long-term employment, standard disciplinary procedures, longevity of service, and subjective expectations of continued employment should not have been considered by the jury at all. See Majority Opinion, at 759-761. In fact, all the evidence presented by the plaintiffs, taken as a whole, was properly considered by the jury because the collective evidence raised a question of fact whether the at-will presumption had been rebutted, even if some of the evidence, considered in isolation, would have been insufficient.
I agree with the majority that "[g]eneral expressions of long term employment or job advancement" or "the establishment of standard disciplinary procedures ... in and of itself " is insufficient to convert an at-will employee to a for-cause employee. Vancheri,
The problem lies in the leap of logic made from these statements of law. Taken together, these cases merely stand for the proposition that any one or, at best, two of the following factors--general expressions of long-term employment, the establishment of disciplinary procedures, longevity of service, or an employee's subjective expectations--do not defeat the at-will presumption. See, e.g., Vancheri,
Thus, an inadvertent flaw in logic leads to the majority's conclusion that "the only factor which the jury properly could consider in deciding the employment contract question is whether Hilton management agreed to terminate the plaintiffs only for failure to perform satisfactorily." See Majority Opinion at 760-761. Nevada law does not support that majority linchpin. Therefore, I would find that the jury properly considered, in resolving the implied contract question, the evidence of Hilton's progressive disciplinary system as set forth in its employee handbooks, its longstanding practice of providing warnings prior to terminating employees, its general expressions of long-term employment, the longevity of the plaintiffs' satisfactory service, and the inducements extended by Hilton to retain the plaintiffs.
B. Specific Representations of For-Cause Employment
Turning to the crux of the plaintiffs' case, the majority characterizes Hilton's representations as nothing more than the plaintiffs' "subjective expectations" that they would not be fired. It further claims that the "large majority" of the plaintiffs did not receive such assurances or that they were advised to the contrary. See Majority Opinion, at 764-765. In doing so, the majority overlooks the substantial evidence of specific promises and representations by Hilton management that the plaintiffs' employment would continue, as long as the plaintiffs performed satisfactorily. Moreover, the majority's attempt to cast these representations as unfounded assumptions or "stray statements" is undermined by the fact that Hilton made some of these representations in response to specific employee concerns about job security during critical points in the Las Vegas Hilton's history. As the quantity, quality, and factual context of Hilton's representations indicate below, more than enough evidence existed for a jury to infer that Hilton modified the "at-will" relationship because it did not want the plaintiffs to leave their jobs.
1. Representations at commencement of and during employment
First, numerous plaintiffs testified that they had received from Hilton management assurances of "for cause" employment--i.e., employment as long as they did their jobs properly--at the time of their hiring or during their term of employment. The following excerpts from the trial are but a few examples:1
[Q:] When you were hired at the Hilton, did you have any conversation with Mr. Haines or anyone else in management regarding how long you could expect to work there?
[A:] Yes. As we were walking to see Newman, Mr. Haines told me that this was a good job, good working conditions, and I'd never have to worry about my job as long as I did it, that I'd have--the only way I can be fired would be to fire myself.
RT XXXII(A)-9 (Delling direct).
* * * * * *
[Q:] Were you told anything by management with regard to job security?
....
[A:] Well, I was told by Jimmy Newman that for as long as I did my work properly, I'd have a job.
[Q:] And what was Jimmy Newman's position at the time?
[A:] He was the casino manager.
[Q:] Now, in 1971, when Hilton acquired the International, do you recall what changes, if any, occurred?
[A:] In management itself none, really. None that affected the dealers. All the management was pretty much still the same. Jimmy Newman was still the casino manager.
RT XXX-11-12 (Borsage direct).
* * * * * *
[Q:] Did anyone from Hilton management tell you anything about how long you could expect to be employed?
[A:] When I started after my dealers training program, Mr. Hybarger, he took me in the office and told me, said, "As long as you do your job, and keep your nose clean, you don't have anything to worry about."
RT XX-34 (Pollins direct).
* * * * * *
[Q:] Did you ever receive any assurances--did anyone from management ever say anything that led you to believe--that your job was secure?
[A:] Well, at the time that I was hired, Bud Haines told me that I was a good dealer; and it was his policy that as long as we performed our job satisfactorily, that we would always have our jobs. And I received numerous remarks of the same nature over the years from Bud Haines.
RT XXIX(A) 60-61 (Landers direct).
See also RT XXIII-13 (Hineline); RT XXVIII-102 (Grace); RT XXIX-27 (Dawson); RT XXXI-9 (Prewitt); RT XXXII-49 (Jodra); RT XXXII(A)-9, 11 (Delling); RT XXXIV(B)-39, 42, 45, 53 (Penny); RT XIX-22 (Brooks).
The majority points out that Art Castle may not have told the plaintiffs at the time of their hiring that they could only be terminated by terminating themselves. See Majority Opinion at 760-761. This is of little significance when the record reveals that other members of Hilton management did make such representations to some plaintiffs at the time of hiring and thereafter. See Ahmad,
The majority also presents selective portions of the plaintiffs' evidence to question the jury's determination that an implied contract existed between Hilton and the plaintiffs. See Majority Opinion, at 761-764. Yet the majority fails to include testimony by the very same plaintiffs tending to diminish or place into context the impact of the selected excerpts. For example, plaintiff Stanford is quoted as "assuming" that his job would be secure as long as he complied with Hilton's rules and did his job properly. See Majority Opinion, at 761. The majority, however, fails to point out that this assumption stemmed from management's practice of giving warnings before terminations:
[A:] ... Bud Haines always had a policy that as long as you did your job, you really wouldn't have any problem. It was kind of a fire-yourself type thing. If you had a problem, he would come to you and warn you. If you did it again, he may warn you again. And probably the third time you were out the door. But he always gave you a couple of chances to clean up your act.
RT XIX-124 (Stanford direct).
Similarly, the majority quotes plaintiff Hineline to illustrate that plaintiffs had only expectations or assumptions about continued employment. See Majority Opinion, at 762. Again, in doing so, the majority overlooks testimony which raises a question as to whether Hineline's assumptions arose from direct representations of job security from Hilton management:
[A:] ... I had talked to Sam Belkan about ... whether or not I had anything to worry about as far as job security. And like I stated before, that he said that as long as I did my job, and kept my nose clean, I'd have a job. That was what he stated.
RT XXIII-13 (Hineline direct).
Cross-examination is the "greatest legal engine ever invented for the discovery of truth." California v. Green,
2. Meeting following the Hilton fire
Plaintiffs also presented evidence that, in the aftermath of the 1981 Hilton fire, management held a meeting to thank them for their willingness to volunteer as maids and porters as Hilton coped with the damage. During this meeting, management reassured the plaintiffs that their jobs were secure, despite the troubles that beset Hilton because of the fire:
[Q:] Do you recall any other meeting where someone from Hilton management talked to you about job security?
[A:] Well, the next meeting we had happened after the fire.... We were called to a meeting when we were supposed to be reintegrated back to work.... [Lewin told] us that the Hilton Corporation would open the hotel even with the tower still damaged by the fire, that he would open the hotel for us, the employees, because we were part of the Hilton family. And he told us that we did not have to worry about our jobs with the Hilton as long as we continued working in the same manner we had worked to up to the fire.
RT XXXII-49 (Jodra direct).
* * * * * *
[Q:] Did Mr. Lewin say why he was holding this meeting?
[A:] No, but I think they was talking about--if I recall--going back to work [after the fire].... But [Lewin] was talking, giving thanks to all of us for the job we performed in the hotel, you know....
. . . . .
[Court:] Just tell us what [Lewin] said.
[A:] So he said I've got a secure job. I've got no problems at all.
RT XXX 81-82 (Torres direct).
3. Preventing union organizing efforts at the Hilton
The testimony at trial also revealed that Jimmy Newman, Hilton's casino manager, assured plaintiffs of job security in an attempt to discourage employee interest in joining a union:
[A:] There was [a union scare] ... and Jimmy [Newman] wanted to nip it in the bud by talking to all of us, saying ... you know, a union is a bad thing.... That as long as you guys do what you're supposed to do you will have a secure job.
RT XXXIV(B) 39 (Penny direct).
* * * * * *
[A:] ... once we were having union talk going around. Mr. Newman talked to some groups and told us we had the best job in town and the best conditions and the best job security, and we didn't need a union.
[Q:] And did you believe that was true?
[A:] Yes.
RT XXXII(A)-11 (Delling direct).
4. Meeting following the "St. Patrick's Day Massacre"
The record also indicated that Hilton management held a meeting specifically to assure plaintiffs of job security after Hilton fired a large number of employees in the so-called "St. Patrick's Day Massacre" of 1982:
[A:] There was a--the terminations we've been talking about, the St. Patrick's Day Massacre occurred, and there was some concern in the casino pits as to the reasons why....
And Mr. Lewin's first statement, I believe, was "This meeting is about job security. We've had a recession. We've had to let some people go. There will be no more mass firings or terminations," and that we're all a big family. "This is the group we want. We're pleased with you people," ...
RT XIX-21 (Brooks direct).
* * * * * *[A:] They had several major layoffs, and after two or three of them [Lewin] called another meeting....
....
[A:] ... They just dumped off a bunch of people, two times, and they evidently heard that we were getting a little skittish, and to try to calm us down they had another meeting.
....
[A:] ... And [Lewin] mentioned again about being a family and he wanted to do the best thing he can for us. That's about the only thing that really stood out in my mind that he talked about other than, you know, he wanted to reassure us that our jobs were secure....
RT XXXIV(B) 46-48 (Penny direct).
* * * * * *
[Q:] Now after these mass terminations, were you at all concerned about your job?
[A:] No, ma'am, I really wasn't concerned with my job.... [B]ut, there was a lot of concern in the hotel. That was very obvious, simply because it was so noticeable that I think Hilton management decided to hold a meeting to try to insure [sic] people that there would be no more than that.
Mr. Lewin, I believe Mr. Hilton, Mr. Newman--there was a lot of people at that meeting.... [Lewin] let us know that there would be no more of that [mass firings], and that we were a part of the Hilton Corporation. We were, as his words I might say, we were part of the Hilton family.
RT XXIII-50 (Rexroad direct).
5. Assurances of no more firings after 1983 management firings
The Hilton terminated several senior casino management officials the following year. The Hilton's blackjack pit manager John Stewart, however, personally assured numerous plaintiffs that there would be no more terminations and that management was satisfied with the team it had in place:
[A:] ... [Stewart] says, "I realize there's a lot of apprehension around the hotel right now because of the recent firings, but that's over and done with and as far as we're concerned, you're on our team."
RT X-61 (Saunto direct).
* * * * * *
[A:] ... [Stewart] come through and he told me personally and he was quite loud, you know. He said that there will be no more terminations, everything is running beautiful now. We did what we had to do, and now there won't be any more terminations. Everything will be fine from here on.
RT XXIV(A)-8 (Mikitaroff direct).
* * * * * *
[Q:] Did anyone from Hilton management ever say anything to you after Mr. Haines had left?
....
[A:] John Stewart--I think it was within a couple of days after Bud Haines had left.... [A]nd [Stewart] told us that we had nothing to worry about, that there wasn't going to be any changes, that that was the end of the changes.
RT XXIX(A)-61 (Landers direct).
* * * * * *
[A:] Well, John Stewart, he came up to the dealers room after one of the big layoffs that they had.... [A]nd he said 'Hey, fellows, it's all over. There's not going to be any more firings, et cetera. Just do what you're supposed to do and your job is secure,' is what he said to these three guys at the card table.
RT XXXIV(B) 41-42 (Penny direct).
The majority characterizes the above evidence as nothing more than "[s]tray statements directed to a small number of individual employees." See Majority Opinion, at 764. The record belies this characterization. At least two meetings, the meetings following the Hilton fire and the St. Patrick's Day Massacre, were held in part for the express purpose of assuring plaintiffs that their jobs would remain secure, notwithstanding the fire and layoffs that so troubled the employees. Senior Hilton management officials, including Chairman Barron Hilton, attended one of these meetings where promises of job security were made, thereby lending further legitimacy to these representations. See RT XXIII-50 (Rexroad direct).
The majority also seeks to cast doubt on the relevance of these many representations of job security by citing a Washington case and a federal diversity case applying Washington law. See Smoot v. Boise Cascade Corp.,
Nevada courts have also observed that "employees may be induced by employers to ... remain on the job by the conduct, policy and implied promises of the employer. Such employees may, accordingly, have enforceable rights which can be asserted in the courts." D'Angelo,
Unfortunately, I must disagree with the majority's belief that the recently decided case, D'Angelo v. Gardner,
Contrary to the majority's view that D'Angelo "endorsed" Vancheri, the case also distinguishes and limits Vancheri. See Majority Opinion, at 765. In refusing to find Vancheri dispositive, D'Angelo cites Vancheri as an example in which a dearth of evidence bars a jury from resolving the questions of fact usually within its realm. The D'Angelo dissent recognizes as much, when it complains that:
... the majority's disregard of the clear doctrine recently announced by this court in Vancheri introduces nothing but uncertainty and confusion in the area of wrongful discharge and at-will employment. Moreover, the majority undermines this court's unanimous declaration in Vancheri concerning the importance of permitting employers to develop sound disciplinary procedures to caution employees....
D'Angelo,
The instant case resembles D'Angelo more than Vancheri. Here, the plaintiffs marshalled equally compelling evidence as that presented in D'Angelo. In fact, not one, but numerous, representations assured them of termination only for cause, unlike plaintiff D'Angelo, who "received no commitments or promises regarding length or security of his employment...." D'Angelo,
The majority's reliance on Bally's,
This is not to say that no evidence supports the majority's suggested result that no implied contract existed. As the majority itself details, some plaintiffs were unable to recall the specific representations which gave rise to their understanding that they would have a job as long as they performed satisfactorily. See, e.g., RT XII(A) 12, 117 (Kustudia); RT XX 2-3 (Stanford); RT XXIII 153-54 (Neill). Yet the record also revealed significant evidence, in quantity and quality, to support the finding of an implied contract. See excerpts quoted supra at 771-775. Evaluating the strength of opposing evidence is the traditional function of the jury. Here, such evidence was more than sufficient to raise a question whether an implied, "for-cause" relationship existed.
Because the resolution of this close issue likely turned on the inferences to be drawn from the conflicting evidence and the credibility of the witnesses, I find it particularly troubling that the majority has, in effect, usurped the jury's factfinding function in this case. It is the jury's function, not ours, to weigh conflicting evidence and judge the credibility of the witnesses. See Transgo, Inc. v. Ajac Transmission Parts Corp.,
II.
Because the jury properly decided that the terminations were wrongful, I would not find, as the majority does, that the district court erred in instructing the jury on the intentional infliction of emotional distress claim. The Nevada courts have not addressed the issue of whether a cause of action for intentional infliction of emotional distress exists in the employment termination context. See D'Angelo,
Although I believe that the jury's finding of an implied contract should be upheld, because I am in the minority on this issue, it would be superfluous in this dissent to reach the questions of whether there was a basis for the bad faith claim or the award of punitive damages, or to address the issues regarding ERISA preemption and the group determination of liability and damages.
Assuming, without necessarily agreeing, that punitive damages should be stricken, I concur with the majority's conclusion that liquidated damages should be awarded to the ADEA plaintiffs and that the district court did not abuse its discretion in declining to award front pay. With the exception of the reference to the punitive damages and emotional distress awards, issues on which I do not express an opinion, I also agree with the majority's disposition of the claims of plaintiffs Foltz and Delling.
III.
I am concerned that the majority has misconstrued Nevada law and overlooked important evidence clearly indicating that sufficient evidence was presented to raise a question of fact regarding the existence of an implied contract. This question was properly submitted to the jury. It is particularly in cases like these that we must remember that appellate "courts are not free to reweigh the evidence and set aside the jury verdict merely because the jury could have drawn different inferences or conclusions or because judges feel that other results are more reasonable." Sanders v. Parker Drilling Co.,
Notes
To the extent that plaintiffs are asking us to look to the employee handbook to support their claims, we note that no provision in the handbook modified the employer's right to fire employees at will. See Sands Regent v. Valgardson,
Plaintiffs cite no case in support of their argument that longevity of service can rebut the at-will presumption in Nevada. Indeed, other states have held that longevity of service cannot convert an at-will contract into one providing for termination only for cause. See Roberts v. Atlantic Richfield Co.,
The dissent argues that the preceding evidence, although insufficient as a matter of Nevada law to establish an implied contract of employment, was nevertheless "properly considered by the jury because the collective evidence raised a question of fact whether the at-will presumption had been rebutted, even if some of the evidence, considered in isolation, would have been insufficient." Dissent at 770 (emphasis in original). With due respect to our dissenting colleague, we cannot agree that the confluence of several factors, none of which is by itself sufficient to establish the existence of an employment contract, can establish such a contract when aggregated. We read the Nevada Supreme Court's cautious language that a certain factor does not "in and of itself," Vancheri,
In these and the following excerpts from the trial testimony, emphasis has been supplied
The dissent relies partially on statements made by management long after these employees were hired at Hilton. See dissent at 773-775. All of these statements--from meetings following the fire, the St. Patrick's Day massacre and the 1983 management firings--are consistent with the at-will nature of the plaintiffs' employment. If encouraging employees to stay on board after a shakeup or tragedy gives rise to for-cause contracts with all those employees who stay, employers will have to stop giving routine pep talks. Furthermore, while the terms of employment may be changed during the time of employment--for example, a previously at-will employee might be given an employment contract--the plaintiffs' theory in this case was that they were covered by an implied contract from the date they were hired. In closing argument, for example, plaintiffs' counsel focused on "what the evidence was as to just what the understanding was, what the meeting of the minds was, between these men and Hilton back in 1970 and '71 when it bought the International." RT XLVII 31 (emphasis added). Because no reasonable jury could have found an agreement at that time, the later expressions by management are irrelevant to the issues before us
Nevada law recognizes two torts related to employment termination: Bad faith discharge, which is based on firing the employee in violation of the implied covenant of good faith and fair dealing in the employment contract, and tortious discharge, which is based on firing the employee in violation of public policy. D'Angelo,
Because plaintiffs were not entitled to any damages for breach of contract or bad faith discharge, we need not address their argument that they should have been awarded emotional distress damages for bad faith discharge
The California Supreme Court will soon consider the issue for the first time. Lanouette v. Ciba-Geigy Corp.,
We need not address Hilton's argument that the award of prejudgment interest on the emotional distress damages was improper under Nevada law. As we have struck down the damages award, the prejudgment interest falls with it
This sanction was equivalent to dismissing Foltz's lawsuit, a sanction we have held must be applied sparingly. See Campbell v. Gerrans,
The court, rather than the jury, made this factual finding because the court awarded compensation for lost retirement benefits as an equitable remedy in the Title VII action, after the jury verdicts came in. CR 493, at 2-3. The court decided that the "equitable method for awarding Plaintiffs lost retirement benefits [was] to utilize the existing provisions of the Hilton Hotels' Retirement Plan." Id. at 3
In the excerpts that follow, the emphases are mine
See
Vancheri actually held that "general expressions of job longevity and advancement, and the established disciplinary procedure as described in this case, are not, as a matter of law, sufficient to establish a prima facie case rebutting the at-will employment presumption." Id.