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Sutula-Johnson v. Office Depot, Inc.

United States District Court, N.D. Illinois, Eastern Division

April 11, 2017

OFFICE DEPOT, INC., Defendant.


          SHARON JOHNSON COLEMAN United States District Court Judge

         Plaintiff, Daryl Sutula-Johnson, brought this action against her employer, Office Depot, Inc., alleging that Office Depot breached its contract with her, unjustly enriched itself at her expense, and violated the Illinois Wage Payment and Collection Act by improperly implementing a new compensation plan and failing to properly calculate her compensation before the new plan went into effect. Following her resignation from Office Depot, Sutula-Johnson amended her complaint to additionally allege that Office Depot refused to pay her outstanding commissions following her resignation. Both parties have now filed cross-motions for summary judgment. For the reasons set forth below, Sutula-Johnson's motion for summary judgment [54] is denied and Office Depot's motion for summary judgment [51] is granted.


         The following facts are undisputed except where otherwise noted.[1] In April 2004, Sutula-Johnson was hired by office-supply company Boise Cascade as a sales executive for commercial office furniture. While employed by Boise Cascade, Sutula-Johnson was paid on a commission basis. Her commission was 27% for orders with an installed profit of 10% or greater, and 20% for orders with an installed profit of less than 10%.

         Boise Cascade was subsequently acquired by OfficeMax Incorporated (“OfficeMax”), which retained Sutula-Johnson as a Furniture Account Executive (“FAE”). While working in this role, Sutula-Johnson was compensated pursuant to the OfficeMax Workspace Sales Incentive Compensation Plan for Furniture Account Executive (the “2010 OfficeMax Plan”), which it is undisputed that she accepted. In pertinent part, the plan provided that FAE's would be paid by commission, but would receive a bi-weekly draw that would be recovered from their subsequent commissions. Commissions were to be paid on the second or third paycheck of the month following the date that the commission was earned. The plan further provided that a commission was “earned” at the earliest of either the payment of the fully invoiced proposal or the passing of 90 days after the proposal was fully invoiced (assuming the customer had not refused to pay the invoice due to issues that the FAE failed to resolve). Sutula-Johnson, however, was grandfathered in under the terms of her prior commission plan with Boise, and therefore was entitled to disbursement of commissions when her sales orders were invoiced to the customer. Under the plan, Sutula-Johnson continued to earn 27% commissions on sales with an installation profit of over 10% and 20% commissions on sales with an installation profit of under 10%.

         The Frequently Asked Questions (FAQ) contained in the plan further explained the plan's mechanisms, providing in pertinent part:

Am I guaranteed to receive any payment under the plan?
No. No associate shall have any vested interest in the payment of an incentive prior to any actual payment being made and earned.
What happens if I leave employment with OfficeMax?
If you terminate employment with OfficeMax for any reason including retirement, death, or disability, you will cease to be a participant in the plan as of the date of termination. In these cases, you will receive payment only of any incentives earned as of the date of termination. An FAE will be paid a commission on propoals [sic] fully invoiced on or before the termination date, less any chargeback, recoupment, or reversal as described in the plan. An FAE will not earn any commission on invoices issued after the FAE's termination date. The commission payout (less any punch list items identified prior to termination) is earned at the earliest of the payment by the customer of the fully invoiced proposal or passing of the ninetieth day after the proposal was fully invoiced and the customer has not refused to pay the invoice due to issues not resolved by the FAE.

(Dkt. 58).

         Upon receiving the FY 2010 sales incentive plan, the recipient was to sign an acknowledgement stating, in pertinent part, that they understood “that neither [the plan] nor any other written or verbal communication alters the status of my employment to anything other than at-will or otherwise creates a contract of employment.” (Dkt. 58). In its FAQ section, the 2010 plan also provided, in pertinent part:

         Does my participation in the plan guarantee my employment?

No. Neither this plan nor any action taken under the plan gives you the right to be retained as an employee for any period. This plan is not and should not be thought of as a contract of employment other than at-will. Employment with OfficeMax is “at-will.” This means either you or the company have the right to terminate your employment at any time, for any reason, with or without notice.
Can the plan be changed or terminated?
Yes. OfficeMax, in its sole discretion, may amend or terminate the plan at any time for any reason without notice.

(Dkt. 58).

         In November 2013, Office Max merged with Office Depot, resulting in the formation of the defendant, Office Depot, Inc. Sutula-Johnson continued to work for Office Depot in the same capacity and continued to be compensated pursuant to the 2010 OfficeMax Plan until July of 2014. On July 14, 2014, Office Depot advised all furniture sales employees, including Sutula-Johnson, that Office Depot would be implementing a new compensation plan, the Office Depot, Inc. 2014 Contract Sales Division Quarterly Incentive Plan (“2014 Plan”), which would be in effect for all orders invoiced after July 14, 2014. Sutula-Johnson subsequently met with her supervisor to discuss the plan's provisions and how it would impact her compensation. Although not addressed in the parties' Rule 56 statements, at oral argument the parties agreed that under the new compensation plan Sutula-Johnson was paid a $3, 400 salary every two weeks in addition to quarterly incentive payments. Under the terms of the 2014 plan, sales representatives with a margin above 125% received a 13.5% incentive payment and those with a margin below 125% received a 10% incentive payment. The incentive payments were to be made in lump sum payments in the calendar quarter following the end of the eligible service period. Payments, moreover, were not “earned or vested” until they were calculated, approved, and distributed. The 2014 plan also provided that an associate who terminated their employment during or after the eligible service period for a reason other than death, disability, retirement, or a reduction in force would not be eligible for any payment under the incentive plan unless such payment was required by law. And, like the prior plan, the 2014 plan provided that it “is not intended to be, and does not constitute in any manner, a contract or guarantee of employment between the Company and Eligible Associates and is not applicable beyond the Eligible Service Period.” (Dkt. 58).

         The 2014 plan went into general effect on July 14, 2014. Sutula-Johnson spoke with various managers about the plan and brought to their attention both general objections to its provisions and specific typos within its body. Despite her objections, Sutula-Johnson was informed that the plan was going into effect and would govern her compensation, and that if she was unwilling to accept that she could resign. Sutula-Johnson ...

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