The opinion of the court was delivered by: Bua, District Judge.
MEMORANDUM OPINION AND ORDER
This action is brought by Wonda Enis (Enis) against her former
employer, Continental Illinois National Bank & Trust Company of
Chicago and Continental Illinois Corporation (collectively
referred to herein as "Continental"). Counts I and II of the
complaint allege employment discrimination in violation of Title
VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.
(Title VII) and 42 U.S.C. § 1981 (§ 1981). Count III alleges
breach of an employment contract based upon provisions of an
employee handbook and is a pendent state law claim. Before this
Court is Continental's motion to dismiss Count III of Enis'
complaint for failure to state a claim upon which relief can be
granted. Continental alternatively requests this Court to deny
pendent jurisdiction of Count III. For the reasons stated herein,
Continental's motion to dismiss Count III of Enis' complaint for
failure to state a claim upon which relief can be based is
Continental Bank is a federally chartered national banking
institution with its principal offices in Chicago, Illinois. It
is a wholly-owned subsidiary of Continental Corporation, a
holding company chartered by the United States Federal Reserve
Enis is a resident of Chicago, Illinois and is a member of the
black race. She was employed by Continental as a remittance
banking supervisor from November, 1980 to January, 1983, when she
was discharged from her position.
In Count I, which is based on Title VII, Enis alleges that her
race was a determining factor in her discharge. In Count II,
based on § 1981, she alleges that the decision to discharge her
was consciously and intentionally motivated by racial
considerations. As to both Counts, Enis alleges that she has
suffered economic damages and, as to Count II, that she has
sustained mental and emotional suffering and distress as a result
of her discharge. She also alleges that she has fulfilled all
conditions precedent to the filing of the Title VII claim. As to
both Counts she seeks reinstatement to her position at
Continental as well as back pay, prejudgment interest, and
Enis alleges that Continental breached the employment agreement
when it dismissed her for a relatively minor offense, for which
Enis denies wrongdoing, without giving prior appropriate notice.
She claims that Continental has refused her demand for
reinstatement and back pay and characterizes such refusal as
unreasonable and vexatious. As to this Count, Enis also alleges
economic damages and seeks compensatory damages, prejudgment
interest, attorneys' fees and costs.
Continental has moved to dismiss Count III of Enis' complaint
for failure to state a claim upon which relief can be granted. It
claims there is no basis in Illinois law for a breach of contract
claim based upon provisions of an employee handbook. In the
alternative, defendant alleges that the state law claim in Count
III does not share a common nucleus of operative fact with the
Title VII and § 1981 claims of Counts I and II, and that
therefore, no basis for pendent jurisdiction exists. The
contentions of Continental regarding dismissal of Count III will
be discussed seriatim.
In its motion to dismiss, Continental first contends that
contrary to Enis' allegations, Illinois law does not provide for
a breach of contract claim based upon provisions of an employee
handbook. This Court agrees.
A motion to dismiss for failure to state a claim upon which
relief can be based is governed by Fed.R.Civ.P. 12(b)(6). For
purposes of such a motion, all well pleaded allegations of fact
are deemed admitted with all questions of reasonable doubt
resolved in favor of the pleader. See Jenkins v. McKeithen,
395 U.S. 411, 421-22, 89 S.Ct. 1843, 1848-49, 23 L.Ed.2d 404 (1969);
Burns v. Paddock, 503 F.2d 18, 25 (7th Cir. 1974). Dismissal is
warranted only if "it appears beyond doubt that the plaintiff can
prove no set of facts in support of his claim which would entitle
him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct.
99, 101-02, 2 L.Ed.2d 80 (1957).
Under Illinois law, an employment contract, whether written or
oral, which is of no specific duration is considered an at-will
contract and may be terminated by either the employer or the
employee, with or without cause, subject only to independent
contractual or statutory provisions. Rynar v. Ciba-Geigy Corp.,
560 F. Supp. 619, 642 (N.D.Ill. 1983); Sargent v. Illinois
Institute of Technology, 78 Ill. App.3d 117, 121, 33 Ill.Dec. 937,
397 N.E.2d 443 (1st Dist. 1979). In Count III, Enis complains
only of violations of terms contained within the contract and not
of statutory violations, which are addressed in the first two
counts. Thus, in order to resolve the motion to dismiss Count
III, it must first be determined just what comprises the
contract. Specifically, the Court must consider whether the
employee handbook altered the at-will relationship between the
In Illinois, the general rule is that an employment handbook is
not part of an employment contract. Rynar, 560 F. Supp. at 624;
Sargent, 78 Ill.App.3d at 121-122, 33 Ill.Dec. 937,
397 N.E.2d 443. Illinois views the employee handbook as a gratuity which
merely serves as a code of conduct and to define general duties.
The handbook does not alter the at-will relationship even if it
was given to ...