The opinion of the court was delivered by: William T. Hart, District Judge.
MEMORANDUM OPINION AND ORDER
Carol A. Pudil originally brought this action in state court
against her former employer Smart Buy, Inc. ("Smart Buy") and
its president Marvin Freeman. On August 16, 1984, the
defendants, both "residents" of California, removed the action
to this Court based on diversity of citizenship. Pudil's
complaint advances three claims arising from her discharge on
May 15, 1984. First, Pudil alleges that Smart Buy discharged
her without cause or notice, in violation of the terms of her
employment contract as set forth in Smart Buy's employee
manual. Second, Pudil asserts that Freeman recklessly
inflicted severe emotional distress upon her by directing her
discharge. Third, Pudil maintains, as an alternative to her
breach of contract claim, that her reasonable reliance upon
the defendants' actions gives rise to a promissory estoppel.
After taking discovery, including Pudil's deposition, the
defendants have moved for summary judgment on all counts.
The facts surrounding Pudil's employment and discharge are
not in dispute. In 1969, Freeman opened his first "optical
boutique" under the trade name Optica. Due to the success of
his concept of expensive, high quality "fashion eyewear,"
Freeman opened a Chicago location in late 1983. He traveled to
Chicago prior to its opening to interview candidates for sales
positions in his Chicago store.
Pudil began working at the Chicago Optica store on November
16, 1983. In either late December, 1983 or early January,
1984, all employees of the Optica Chicago store met with the
store manager. At this meeting, the store manager presented
Optica's employee manual to the employees by reading the full
text of the eight-page document to them and requiring each
employee to sign and return a half-page acknowledgement that
he or she had received, read and understood the document. The
manual contained: (i) a statement of the history of Optica;
(ii) instructions to employees on proper dress, courtesy to
customers and attendance; (iii) a statement of health,
vacation and eyeglass benefits available to employees and
promotion policy, and (iv) a list of those "offenses" that
would result in immediate discharge and those that would
result in discharge "after written notice."
During the course of her employment at Optica, Pudil
purchased a new car (trading in her old car) and finalized her
divorce (thereby losing health insurance under her
ex-husband's policy). She also "altered her lifestyle in
conformance with her increased earnings." Approximately ninety
days after Pudil began work at Optica, she received a note
from Freeman congratulating her on the quality of her work,
informing her that her current paycheck included an increase
in pay and expressing the hope that "you'll be with us for a
On May 15, 1984, Optica's Chicago store manager informed
Pudil that she was discharged, effective immediately. Optica's
assistant store manager offered to help Pudil find a new job
and Optica paid Pudil a severance allowance at the time of her
termination. Although Pudil asked the reason for her
discharge, Optica refused to give any reason. Pudil was
distressed by the loss of her job at Optica and consulted her
personal doctor, who prescribed tranquilizers.
Pudil concedes that, under Illinois law, a written or oral
employment contract which does not specify the duration of
employment creates an employment "at-will" relationship,
terminable by either party at any time, with or without cause.
See, e.g., Gordon v. Matthew Bender & Co., 562 F. Supp. 1286,
1290-92 (N.D.Ill. 1983); Goodman v. Board of Trustees,
511 F. Supp. 602, 606 (N.D.Ill. 1981). Since Pudil does not contend
that her original engagement to work at Optica's Chicago store
specified any duration, she must be viewed as an employee
"at-will." Nonetheless, she maintains that the employee manual,
distributed after she began her work at Optica, either modified
her original engagement or should be read in interpreting that
The Illinois Supreme Court has yet to pass on the effect of
an employee manual upon the employer's discretion to terminate
"at-will" employees. Therefore, this Court must attempt to
predict the path the Illinois Supreme Court would follow.
In re Air Crash Disaster, 701 F.2d 1189, 1197 (7th Cir.), cert.
denied, ___ U.S. ___, 104 S.Ct. 204, 78 L.Ed.2d 178 (1983);
Roberts v. Western-Southern Life Ins. Co., 568 F. Supp. 536, 540
(N.D.Ill. 1983). In predicting how the Illinois Supreme Court
would decide this issue, the decisions of the Illinois
Appellate Court, id., and decisions from other jurisdictions,
Martin v. Harrington and Richardson, Inc., 743 F.2d 1200, 1202
(7th Cir. 1984), are helpful indicators.
Illinois case law on this issue begins with Carter v.
Kaskaskia Community Action Agency, 24 Ill. App.3d 1056,
322 N.E.2d 574 (5th Dist. 1974). In Carter, the state court
found that an employer must abide by the grievance procedures
set forth in its personnel policy manual where the manual
contained provisions which created mutual obligations for the
employer and its employees and the employee assented to the
manual as a modification of his employment relation.
Subsequently, Sargent v. Illinois Institute of Technology,
78 Ill. App.3d 117, 33 Ill.Dec. 937, 397 N.E.2d 443 (1st Dist.
1979) gave a narrow reading to Carter, holding that since the
personnel manual was given to the employee when he began his
employment and contained no provisions imposing conditions on
him beyond his required duties, the manual was not "bargained
for" and so unenforceable. More recently another appellate
court applied Carter to require a county board to honor its
sheriff's announcement to his deputies that they would receive
a raise. Scutt v. LaSalle County Board, 97 Ill. App.3d 181, 53
Ill.Dec. 21, 423 N.E.2d 213 (3rd Dist. 1981).
Relying on the decision in Sargent, two published opinions in
this district and additional unpublished opinions, e.g.,
Brundage v. Trans World Airlines, Inc., No. 80 C 6701, slip op.
at 7-9 (N.D.Ill. March 29, 1984) (Hart, J.), have determined
that the provisions of personnel manuals do not bind employers.
In Rynar v. Ciba-Geigy Corp., 560 F. Supp. 619 (N.D.Ill. 1983),
Judge Will found that although the manual contained terms
suggesting a mutuality of obligation, the employees had not
assented to the modification because they were only generally
aware of its existence but had not reviewed or approved its
specific provisions. Citing Rynar, Judge Bua later found that a
manual provided to ...