19-1207-cv
Smith v. Shaw’s Supermarkets, Inc.

                           UNITED STATES COURT OF APPEALS
                               FOR THE SECOND CIRCUIT

                                       SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A
SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED
BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1.
WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY
MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE
NOTATION “SUMMARY ORDER”). A PARTY CITING TO A SUMMARY ORDER MUST SERVE A
COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

        At a stated term of the United States Court of Appeals for the Second Circuit, held at the
Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York, on the
20th day of April, two thousand twenty.

Present:
            DEBRA ANN LIVINGSTON,
            RAYMOND J. LOHIER, JR.,
            WILLIAM J. NARDINI,
                  Circuit Judges.
_____________________________________

CHERYL A. SMITH,

                         Plaintiff-Appellant,

                 v.                                                  19-1207-cv

SHAW’S SUPERMARKETS, INC.,

                  Defendant-Appellee.
_____________________________________

For Plaintiff-Appellant:                        JAMES G. LEVINS, Tepper Dardeck & Levins, LLP,
                                                Rutland, VT.

For Defendant-Appellee:                         MARTHA VAN OOT, Jackson Lewis P.C., Portsmouth,
                                                NH.




                                                     1
        Appeal from a judgment of the United States District Court for the District of Vermont

(Reiss, J.).

        UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND

DECREED that the judgment of the district court is AFFIRMED.

        Plaintiff-Appellant Cheryl A. Smith (“Smith”) sued her former employer, Shaw’s

Supermarkets, Inc. (“Defendant”), alleging breach of an implied contract of employment in

violation of Vermont law.      She now appeals from an opinion, order, and judgment of the U.S.

District Court for the District of Vermont (Reiss, J.), entered on April 1, 2019, granting summary

judgment in favor of Defendant.     We review grants of summary judgment de novo, “construing the

facts in the light most favorable to the non-moving party and drawing all reasonable inferences in

that party’s favor.”   Burns v. Martuscello, 890 F.3d 77, 83 (2d Cir. 2018) (internal quotation marks

and citation omitted). We assume the parties’ familiarity with the underlying facts, the procedural

history of the case, and the issues on appeal.

                                           *      *       *

        The parties agree that Smith’s employment was terminated following her involvement in a

dispute with Leslie Jay Bowen (“Bowen”), a customer and former employee of Defendant, during

which Smith touched Bowen without his consent.        On appeal, Smith argues that her termination

was improper because it violated the progressive discipline procedure contained in Defendant’s

Team Member Handbook (the “Handbook”), which Smith contends established an implied contract

to fire employees only for cause. Under the progressive discipline procedure, Smith argues that

she should have been given a three-day suspension and a final letter of warning, rather than being

terminated.




                                                  2
       We disagree.    The district court correctly determined that Defendant’s Handbook, together

with its actual practices, failed to create an implied contract to fire its employees only for cause.

Under Vermont law, the at-will employment relationship may be altered by “personnel policies or

practices of the employer,” including those “set out in an employee handbook.”      Benoir v. Ethan

Allen, Inc., 514 A.2d 716, 718 (Vt. 1986) (internal quotation marks and citation omitted). The

Supreme Court of Vermont has found such implied contracts exist where the employer’s policies

“are definitive in form, communicated to employees, and evince an employer’s intent to bind itself,”

Havill v. Woodstock Soapstone Co., 783 A.2d 423, 428 (Vt. 2001) (citing Ross v. Times Mirror, Inc.,

665 A.2d 580, 584 (Vt. 1995)), such as where a handbook set out an “elaborate system governing

employee discipline and discharge” that was “mandatory in tone,” Dillon v. Champion Jogbra, Inc.,

819 A.2d 703, 705, 708 (Vt. 2002).

       Here, by contrast, the Handbook was permeated with conditional and cautionary language

that communicated the absence of an intent to be bound to the use of progressive disciplinary

measures. The Handbook states that Defendant “generally follows a progressive corrective action

process that may include” steps such as verbal warnings and suspensions, but notes that

“[n]otwithstanding this general practice, there may be some performance issues and policy

violations that are so severe that immediate corrective action including termination may be

necessary at [Defendant’s] sole discretion.”   A. 36 (emphasis added). The subsequent sentences

reiterate that “[i]n [Defendant’s] sole discretion, it may skip some or all of the steps in the

progressive corrective action process,” and that Defendant “reserves the right to determine the

appropriateness and level of counseling[] or corrective action in each situation, including whether

immediate termination of employment is warranted.”         Id. (emphasis added).     The Handbook

separately sets forth a non-exclusive list of reasons for immediate termination that begins by




                                                 3
reiterating the default at-will status of all employees.    Id. at 36–37.   Thus, the Handbook’s

language considered as a whole unambiguously communicates that Defendant reserves the right to

use progressive discipline at its discretion, rather than binding itself to do so in every case or

“promis[ing] . . . specific treatment in specific situations.” Ross, 665 A.2d at 584. Furthermore,

the Handbook’s multiple broad disclaimers unequivocally stating that the at-will relationship

remains intact, while not dispositive, see Dillon, 819 A.2d at 708, further reinforce the absence of

any objective indicia of an intent to be bound, see A. 16 (“This Handbook is not a contract of

employment or a guarantee of continued employment . . . [and] [o]nly the Chief Executive Officer

of the Company has the authority to make an employment agreement for anything other than

employment at-will and then only in writing and signed by or duly authorized by the Chief

Executive Officer.”); id. at 36 (“These corrective action procedures do not alter the at-will

employment relationship.”); id. at 37 (“This Team Member Handbook is not intended to create a

contract, nor is it to be construed to constitute a contract of employment. Both [Defendant] and

[employee] retain the right to terminate our employment relationship at any time, and for any

reason, except as otherwise provided by an enforceable written agreement signed by [Defendant’s]

CEO or designee.”).   Given the Handbook’s unambiguous language, the district court did not err in

determining, as a matter of Vermont law, that the Handbook did not create an implied contract

between Smith and Defendant that Defendant would fire Smith only for cause.

       Moreover, none of the deposition testimony cited by Smith supports the inference that

Defendant’s practices created an implied contract.   While Smith’s supervisor testified that she was

familiar with the Handbook’s outline for progressive discipline, she also affirmed that she took

“guidance from Human Resources . . . [i]n “all cases.” Id. at 239.      This open-ended testimony

does not support the inference that Defendant bound itself to a uniform, consistent enforcement of




                                                 4
the Handbook’s progressive discipline policy. Likewise, the testimony of another employee that

she was familiar with the progressive discipline policy and believed that employees “get quite a few

written warnings before termination,” id. at 267, and the testimony of the Regional Human

Resources Manager that the progressive discipline procedure constituted “normal practices” but that

the steps taken for corrective action “would depend on the situation,” id. at 226, do not support such

an inference.   Given the absence of evidence of an implied contract to fire employees only for

cause, the district court properly awarded summary judgment in favor of Defendant.

         Finally, even if Defendant had been bound by the policies set out in its Handbook, the

record is devoid of evidence that these policies were breached in this case.      The Handbook makes

clear that violations of the Threats and Violence Free Workplace policy, which covers conduct that

“threatens another person’s safety . . . or causes them to perceive their safety . . . is threatened,” id.

at 35, as well as violations of the Courtesy, Dignity and Respect Policy, “including quarreling or

fighting with . . . other Team Members[] [or] customers,” could justify immediate termination, id. at

36–37.    Given Smith’s undisputed involvement in a confrontation at the workplace during which

she physically touched Bowen without consent, Defendant’s discretionary decision, following an

investigation, to terminate Smith’s employment without proceeding through the steps of the

progressive discipline procedure was entirely consistent with its policies.          Accordingly, even

assuming the Handbook created an implied contract, Smith’s breach of contract claim cannot

withstand summary judgment.

         We have considered Smith’s remaining arguments and find them to be without merit.

Accordingly, we AFFIRM the judgment of the district court.

                                                        FOR THE COURT:
                                                        Catherine O’Hagan Wolfe, Clerk




                                                    5
