Geysen v. Securitas Security Services USA, Inc.

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KEVIN GEYSEN v. SECURITAS SECURITY SERVICES
USA, INC.
(SC 19545)
Rogers, C. J., and Palmer, Zarella, Eveleigh, McDonald, Espinosa and
Robinson, Js.*
Argued March 28—officially released August 9, 2016

Daniel J. Krisch, with whom, on the brief were
George D. Royster and Logan A. Forsey, for the appel-
lant-appellee (defendant).
Todd D. Steigman, for the appellee-appellant
(plaintiff).
 Opinion

ROGERS, C. J. This consolidated appeal1 presents the
question of whether an at-will employment agreement,
providing that an employee’s commissions will not be
paid unless the employer has invoiced commissionable
amounts to the client prior to the employee’s termina-
tion, is contrary to public policy and a violation of
General Statutes (Supp. 2016) § 31-72.2 The defendant,
Securitas Security Services, USA, Inc., appeals from the
stipulated judgment of the trial court in favor of the
plaintiff, Kevin Geysen, on his wage statute claim and
the trial court’s underlying ruling holding that this com-
mission provision was contrary to public policy. Addi-
tionally, the plaintiff cross appeals claiming, inter alia,
that the trial court improperly granted the motion to
strike counts two and three of the complaint alleging
breach of the implied covenant of good faith and fair
dealing and wrongful termination in violation of public
policy, respectively. We agree with the defendant that
the trial court improperly determined that the commis-
sion provision violated public policy and constituted a
violation of § 31-72. With regard to the plaintiff’s cross
appeal, we hold that count two of the plaintiff’s com-
plaint alleging breach of the implied covenant of good
faith and fair dealing should not have been stricken
but that count three alleging wrongful discharge was
properly stricken. Accordingly, we reverse in part the
judgment of the trial court.3
The following procedural history and facts are rele-
vant to this appeal. The defendant is a security services
company that provides various protection services to
industrial and commercial clients. These services are
marketed through employees hired as business develop-
ment managers (managers) who solicit new business
from prospective and existing customers. In August,
2005, the defendant offered the plaintiff an at-will posi-
tion as a manager. The defendant’s offer letter, which
the plaintiff signed in September, 2005, provided that
the plaintiff’s compensation was a weekly base salary
and commissions on contracts he procured.4 The offer
letter referenced and mirrored the defendant’s 2003
sales incentive plan, which was in effect at the time
the plaintiff commenced his employment.
The defendant subsequently amended its sales incen-
tive plan effective December 23, 2006, and revised the
commission provision at issue. Section II, part C of
the 2006 sales incentive plan regarding sales eligibility
requirements provides that ‘‘[c]ommission is only paid
once work has been performed and invoiced to the
client. Upon termination of services to the client all
commissions cease, except that commission will be
paid up through and including the final invoice. Upon
the [manager’s] termination of employment, all com-
missions cease, except that any commissionable
amounts that have been invoiced [to the client] prior
to the [manager’s] [t]ermination [d]ate, as defined in
[s]ection IV.D, will still be paid commission as part
of final pay to the [manager].’’ (Emphasis added.)
From 2005 to 2008, the plaintiff worked as a manager,
on behalf of the defendant, marketing new and supple-
mental security services to new and existing customers.
Based on the applicable sales incentive plan, once the
contract was executed and the sales eligibility require-
ments were satisfied, including invoicing to the client,
the plaintiff was entitled to commission payments with-
out having to perform any other work.
On May 22, 2008, Thomas R. Fagan, the defendant’s
regional vice president for human resources, hand deliv-
ered a memorandum to the plaintiff terminating his
employment. The memorandum explained that the
defendant had conducted an investigation into
improper business activities that had resulted in signifi-
cant risk exposure to the defendant and, as a result of
the investigation findings, the defendant was terminat-
ing the plaintiff’s employment effective May 22, 2008.
On August 18, 2009, the plaintiff filed a complaint
alleging that the defendant violated § 31-72, breached
his employment contract by violating the implied cove-
nant of good faith and fair dealing, and wrongfully dis-
charged him in violation of public policy. The plaintiff
alleged that the defendant’s reasons for his termination
‘‘were false and a pretext for nonpayment of owed com-
missions.’’ The defendant moved to strike count two,
alleging breach of the implied covenant of good faith
and fair dealing, and count three, alleging wrongful
discharge in violation of public policy. Relying on Burn-
ham v. Karl & Gelb, P.C., 252 Conn. 153, 745 A.2d 178
(2000), the trial court granted the defendant’s motion
to strike both counts because it believed the plaintiff
had an adequate statutory remedy under § 31-72. See
id., 161–62 (holding that even if plaintiff’s termination
violated public policy embodied in statute, plaintiff’s
wrongful discharge claim would be precluded due to
existence of statutory remedy under that statute) The
trial court then rendered a partial judgment for the
defendant on the two stricken counts.5
Before trial, the parties agreed that ‘‘the plaintiff’s
claim hinges on whether or not the language in the
defendant’s sales incentive plan, which provides that
the right to commissions ceases upon the plaintiff’s
termination of employment, is enforceable.’’ Therefore,
the trial court agreed to decide the enforceability ques-
tion and, in order to facilitate the trial court’s determina-
tion, the parties entered into a stipulation of facts dated
March 1, 2012.6
The trial court determined that, because the plaintiff’s
right to commissions was not contingent upon his pro-
viding any further services to the defendant’s custom-
ers, he had fully earned his commissions when his
employment was terminated. Thus, the trial court found
that since the provision in the sales incentive plan
deprived him of those earned commissions, resulted in
forfeiture of wages, and applied even to an employee
who is terminated for no cause, the provision was unen-
forceable because it ‘‘violate[d] two public policies: the
first, which strongly favors the payment of wages, and
the second, which disfavors forfeitures.’’
On October 16, 2014, the parties stipulated to a judg-
ment in favor of the plaintiff for unpaid commissions
pursuant to § 31-72, but preserved their respective
rights to appeal. The defendant appealed from the stipu-
lated judgment and the plaintiff cross appealed. We
now turn to the merits of those appeals.
I
We first address the defendant’s claim that the com-
mission provision was not void on public policy grounds
and, therefore, the failure to pay the plaintiff’s commis-
sions was not a violation of § 31-72. We begin by setting
out the applicable standard of review and relevant legal
principles. ‘‘Although it is well established that parties
are free to contract for whatever terms on which they
may agree . . . it is equally well established that con-
tracts that violate public policy are unenforceable. . . .
[T]he question [of] whether a contract is against public
policy is [a] question of law dependent on the circum-
stances of the particular case, over which an appellate
court has unlimited review.’’ (Citations omitted; internal
quotation marks omitted.) Hanks v. Powder Ridge Res-
taurant Corp., 276 Conn. 314, 326–27, 885 A.2d 734
(2005); Brown v. Soh, 280 Conn. 494, 501, 909 A.2d 43
(2006); see also State v. Lynch, 287 Conn. 464, 477, 948
A.2d 1026 (2008).
‘‘There is a strong public policy in Connecticut
favoring freedom of contract . . . . This freedom
includes the right to contract for the assumption of
known or unknown hazards and risks that may arise
as a consequence of the execution of the contract.
Accordingly, in private disputes, a court must enforce
the contract as drafted by the parties and may not
relieve a contracting party from anticipated or actual
difficulties undertaken pursuant to the contract, unless
the contract is voidable on grounds such as mistake,
fraud or unconscionability. . . . If a contract violates
public policy, this would be a ground to not enforce
the contract. . . . A contract . . . however, does not
violate public policy just because the contract was made
unwisely. . . . [C]ourts do not unmake bargains
unwisely made. Absent other infirmities, bargains
moved on calculated considerations, and whether prov-
ident or improvident, are entitled nevertheless to sanc-
tions of the law. . . . Although parties might prefer to
have the court decide the plain effect of their contract
contrary to the agreement, it is not within its power to
make a new and different agreement; contracts volunta-
rily and fairly made should be held valid and enforced
in the courts.’’ (Citations omitted; emphasis omitted;
footnote omitted; internal quotation marks omitted.)
Schwartz v. Family Dental Group, P.C., 106 Conn. App.
765, 772–73, 943 A.2d 1122, cert. denied, 288 Conn. 911,
954 A.2d 184 (2008), quoting Tallmadge Bros., Inc. v.
Iroquois Gas Transmission System, L.P., 252 Conn.
479, 505–506, 746 A.2d 1277 (2000).
If the commission provision at issue acts to negate the
wage statutes, however, the provision violates public
policy. See Parente v. Pirozzoli, 87 Conn. App. 235, 246,
866 A.2d 629 (2005) (‘‘Generally, agreements contrary to
public policy, that is those that negate laws enacted for
the common good, are illegal and therefore unenforce-
able. . . . Agreements that are legal on their face, yet
which are designed to evade statutory requirements,
are routinely held unenforceable.’’ [Citation omitted;
internal quotation marks omitted.]). We must initially
determine, therefore, whether the commission provi-
sion violates the wage statutes.
We have held that § 31-72 ‘‘does not embody substan-
tive standards to determine the amount of wages that
are payable but provides penalties in order to deter
employers from deferring wage payments once they
have accrued. Section 31-72 is, therefore, a remedial
statute rather than one creating independent substan-
tive rights. . . . [This] interpretation of § 31-72 sup-
ports the notion that the wage statutes, as a whole, do
not provide substantive rights regarding how a wage is
earned; rather, they provide remedial protections for
those cases in which the employer-employee wage
agreement is violated. The wage agreement is not dic-
tated by the statutes; instead, it is the integrity of that
wage agreement that is protected by the statutory provi-
sions.’’ (Citation omitted; emphasis in original; internal
quotation marks omitted.) Mytych v. May Dept. Stores
Co., 260 Conn. 152, 162, 793 A.2d 1068 (2002). In other
words, the Connecticut wage statutes ‘‘[do] not purport
to define the wages due; [they] merely [require] that
those wages agreed to will not be withheld for any
reason.’’ Id., 160; State v. Lynch, supra, 287 Conn. 472.
‘‘In Mytych [v. May Dept. Stores Co., supra, 260 Conn.
156], [the court] considered the question of whether
the defendant employer’s practice of calculating the
plaintiff employees’ sales commissions by deducting
from their respective gross sales figures a pro rata share
of unidentified returns . . . violated a statutory provi-
sion disallowing unauthorized deductions from
wages.’’7 State v. Lynch, supra, 287 Conn. 472. The court
held that it did not, as the Connecticut wage statutes
left the substantive standards for the determination of
wages to the agreement between the employer and the
employee. Id. Specifically, the court held that ‘‘the for-
mula by which an employee’s wage is calculated is
determined by the agreement between the employer
and the employee’’; Mytych v. May Dept. Stores Co.,
supra, 160; because the definition of wages ‘‘expressly
[left] the determination of the wage to the employer-
employee agreement, assuming some specific condi-
tions, such as a minimum hourly wage, are met.’’ Id., 163.
The court in Mytych then explicitly rejected the plain-
tiffs’ reasoning that their wages accrued at the time
they rendered their services by making sales because,
while the California case cited by the plaintiffs relied
‘‘on a long history of California case law and regulatory
opinions establishing that an employee’s right to a com-
mission accrues or vests at the time of the actual sale
. . . [i]n Connecticut, there [was] no such settled doc-
trine regarding the time at which an employee’s rights
to his wages vests and, in fact, we [had] concluded
[t]herein that our wage payment statutes expressly
leave the timing of accrual to the determination of
the wage agreement between the employer and [the]
employee.’’ (Emphasis added.) Id., 164–65; see State v.
Lynch, supra, 287 Conn. 473, 476.
With these applicable legal principles in mind, we
now address whether the commission provision in the
present case violates public policy and the wage stat-
utes. The court in Mytych clearly addressed the timing
of wage accrual and left the determination of this matter
to the employment agreement. See Mytych v. May Dept.
Stores Co., supra, 260 Conn. 164–65. Additionally, in
Mytych, this court specifically rejected the doctrine that
an employee’s right to wages necessarily accrued at the
time of sale. In the present case, on the basis of the
clear language of the commission provision, invoicing
prior to the plaintiff’s termination is a condition prece-
dent to earning the commission. In fact, the plaintiff
concedes that for the payment of commissions, the
sales eligibility requirements in the applicable sales
incentive plan were required to be satisfied.8 One of
the sales eligibility requirements was that the commis-
sionable amounts be invoiced to the client prior to
the manager’s termination. Thus, we agree with the
defendant that the commissions were not ‘‘due’’ within
the meaning of General Statutes 31-71b (a)9 because
there was a condition precedent to their accrual that
had not been satisfied. Nevertheless, the plaintiff con-
tends that the commission provision should not be
enforceable because he did not have to provide any
further services to the defendant’s customers and,
therefore, he had fully earned his commissions under
the wage statutes.10
In Mytych v. May Dept. Stores Co., supra, 260 Conn.
163–64 and n.7, however, the employees did not have
to provide any additional services and this court still
held that their wages had not accrued at the time of
sale. Likewise, in Kelley v. Sun Microsystems, Inc., 520
F. Supp. 2d 388, 407 (D. Conn. 2007), the federal District
Court, applying Connecticut law, rendered summary
judgment in favor of the defendant employer on a § 31-
72 claim. The plaintiff employee identified thirteen sales
orders that had been shipped prior to the employee’s
official termination. Id., 406. The employer’s governing
sales compensation plan provided that a ‘‘[c]ommission
is earned on direct business and considered due and
payable to any participant in the commission plan upon
revenue recognition and receipt by [the defendant] of
full payment for all commissionable products.’’ Id. In
addition, the contract in Kelley indicated that no incen-
tive commissions would be made without a fully exe-
cuted employee ‘‘[g]oal [s]heet’’ signed by the client,
two levels of management and the area controller for
that fiscal year. Id. As the employee did not have a goal
sheet for that fiscal year, relying on Mytych, the District
Court was ‘‘forced to conclude’’ that the employer had
not failed to pay ‘‘wages’’ under the wage statutes. Id.;
see also Mullowney v. Data General Corp., 143 F.3d
1081, 1083 (7th Cir. 1998) (applying Massachusetts law
and finding that, although there was certainly risk that
employee could lose commissions on some sales for
which he was primarily responsible based on at-will
agreement where employee would be entitled to com-
missions only on those sales invoiced or shipped before
his termination became effective, ‘‘[t]his was the bar-
gain he made . . . he cannot now . . . be heard to
complain because [the employer] adhered to this
arrangement’’); cf., e.g., State v. Lynch, supra, 287 Conn.
476 (noting that under Ravetto v. Triton Thalassic Tech-
nologies, Inc., 285 Conn. 716, 725–26, 941 A.2d 309
[2008], ‘‘an agreement between informed, sophisticated
employees and their employer to defer accrual of future
wages until the employer receives income [was] not
unreasonable and, in fact, may well [have been] benefi-
cial to all parties concerned’’ and as such did not violate
public policy).
On the basis of our review of Connecticut law and
the public policy of freedom of contract reflected in our
common law, we do not believe that this commission
provision on its face ‘‘negate[s] laws enacted for the
common good’’ or is ‘‘designed to evade statutory
requirements . . . .’’ (Internal quotation marks omit-
ted.) Parente v. Pirozzoli, supra, 87 Conn. App. 246.
We conclude, therefore, that the contract provision pro-
viding that commissions will be paid only if the work
had been invoiced prior to termination of the employee
does not violate public policy and is enforceable.
Because the plaintiff was not due his commissions
under the express and enforceable terms of his
agreement with the defendant, and the agreement does
not violate public policy, we hold that there was no
violation of the wage statutes.
II
We now turn to the plaintiff’s cross appeal from the
trial court’s grant of the defendant’s motion to strike
two counts of the complaint. ‘‘We begin by setting out
the well established standard of review in an appeal
from the granting of a motion to strike. Because a
motion to strike challenges the legal sufficiency of a
pleading and, consequently, requires no factual findings
by the trial court, our review of the court’s ruling . . .
is plenary. . . . We take the facts to be those alleged
in the complaint that has been stricken and we construe
the complaint in the manner most favorable to sus-
taining its legal sufficiency. . . . Thus, [i]f facts prov-
able in the complaint would support a cause of action,
the motion to strike must be denied. . . . Moreover, we
note that [w]hat is necessarily implied [in an allegation]
need not be expressly alleged. . . . It is fundamental
that in determining the sufficiency of a complaint chal-
lenged by a defendant’s motion to strike, all well-
pleaded facts and those facts necessarily implied from
the allegations are taken as admitted. . . . Indeed,
pleadings must be construed broadly and realistically,
rather than narrowly and technically.’’ (Internal quota-
tion marks omitted.) Coppola Construction Co. v. Hoff-
man Enterprises Ltd. Partnership, 309 Conn. 342, 350,
71 A.3d 480 (2013).
A
We analyze first the plaintiff’s cross appeal seeking
reinstatement of the breach of the implied covenant of
good faith and fair dealing count. ‘‘[I]t is axiomatic that
the . . . duty of good faith and fair dealing is a cove-
nant implied into a contract or a contractual relation-
ship. . . . In other words, every contract carries an
implied duty requiring that neither party do anything
that will injure the right of the other to receive the
benefits of the agreement. . . . The covenant of good
faith and fair dealing presupposes that the terms and
purpose of the contract are agreed upon by the parties
and that what is in dispute is a party’s discretionary
application or interpretation of a contract term.’’11 (Cita-
tions omitted; internal quotation marks omitted.) De La
Concha of Hartford, Inc. v. Aetna Life Ins. Co., 269
Conn. 424, 432–33, 849 A.2d 382 (2004); Landry v. Spitz,
102 Conn. App. 34, 47, 925 A.2d 334 (2007) (‘‘[s]tated
otherwise, the claim [that the covenant has been
breached] must be tied to an alleged breach of a specific
contract term, often one that allows for discretion on
the part of the party alleged to have violated the duty’’
[internal quotation marks omitted]).
‘‘To constitute a breach of [the implied covenant of
good faith and fair dealing], the acts by which a defen-
dant allegedly impedes the plaintiff’s right to receive
benefits that he or she reasonably expected to receive
under the contract must have been taken in bad faith.
. . . Bad faith in general implies . . . actual or con-
structive fraud, or a design to mislead or deceive
another, or a neglect or refusal to fulfill some duty or
some contractual obligation, not prompted by an honest
mistake as to one’s rights or duties, but by some inter-
ested or sinister motive. . . . Bad faith means more
than mere negligence; it involves a dishonest purpose.’’
(Citation omitted; internal quotation marks omitted.)
De La Concha of Hartford, Inc. v. Aetna Life Ins. Co.,
supra, 269 Conn. 433. ‘‘[B]ad faith may be overt or may
consist of inaction, and it may include evasion of the
spirit of the bargain . . . . Elm Street Builders, Inc.
v. Enterprise Park Condominium Assn., Inc., 63 Conn.
App. 657, 667, 778 A.2d 237 (2001), quoting 2
Restatement (Second), Contracts § 205, comment (d)
(1981); see also 23 S. Williston, Contracts (4th Ed. Lord
2002) § 63:22, p. 508 (a party who evades the spirit of
the contract . . . may be liable for breach of the
implied covenant of good faith and fair dealing . . .).’’
(Internal quotation marks omitted.) Landry v. Spitz,
supra, 102 Conn. App. 43. ‘‘[W]hen one party performs
the contract in a manner that is unfaithful to the purpose
of the contract and the justified expectations of the
other party are thus denied, there is a breach of the
covenant of good faith and fair dealing, and hence, a
breach of contract, for which damages may be recov-
ered . . . .’’ (Internal quotation marks omitted.) Id., 44.
In Magnan v. Anaconda Industries, Inc., 193 Conn.
558, 479 A.2d 781 (1984), this court addressed the
implied covenant of good faith and fair dealing in
employment contracts. The plaintiff in that case con-
tended that the good faith principle was applicable and
subjected the employer to liability whenever an
employee is discharged without just cause. Id., 567.
For guidance, the court looked to Massachusetts cases
applying the implied covenant of good faith and fair
dealing in the employment context. Id., 569–71. While
the court recognized the applicability of the covenant
of good faith to employment contracts, it concluded
that a breach of such an implied covenant cannot be
predicated simply upon the absence of good cause for
discharge. Id., 571–72. The court specifically declined
the plaintiff’s invitation ‘‘to transform the requirement
of good faith into an implied condition that an employee
may be dismissed only for good cause.’’ Id., 571; see
also Carbone v. Atlantic Richfield Co., 204 Conn. 460,
469–70, 528 A.2d 1137 (1987), quoting Morris v. Hart-
ford Courant Co., 200 Conn. 676, 679 n.2, 513 A.2d 66
(1986). In Magnan, the court left for another day the
determination of the applicability of the covenant of
good faith and fair dealing to a discharge that was
motivated by an intent to deprive an employee of clearly
identifiable compensation related to past services. See
Magnan v. Anaconda Industries, Inc., supra, 573. As
such, the court acknowledged, but did not fully con-
sider, the Massachusetts case of Fortune v. National
Cash Register Co., 373 Mass. 96, 364 N.E.2d 1251 (1977).
See Magnan v. Anaconda Industries, Inc., supra, 570
n.20, 571.
Fortune is particularly illustrative in our present case.
In Fortune, under the express terms of an at-will
employment contract, the plaintiff employee had
received all the bonus commissions to which he was
entitled when his employment with the defendant was
terminated. Fortune v. National Cash Register Co.,
supra, 373 Mass. 101. The court acknowledged that ‘‘an
employer is entitled to be motivated by and to serve
its own legitimate business interests; that an employer
must have wide latitude in deciding whom it will employ
in the face of the uncertainties of the business world;
and that an employer needs flexibility in the face of
changing circumstances.’’ Id., 101–102. Nevertheless,
the Massachusetts Supreme Judicial Court held that
the employer’s written contract contained an implied
covenant of good faith and fair dealing and that, in a
situation where commissions are to be paid for work
performed by the employee, a bad faith termination
constituted a breach of that contract.12 Id.
The court in Fortune further stated that ‘‘[w]here the
principal seeks to deprive the agent of all compensation
by terminating the contractual relationship when the
agent is on the brink of successfully completing the
sale, the principal has acted in bad faith and the ensuing
transaction between the principal and the buyer is to
be regarded as having been accomplished by the agent.
. . . The same result obtains where the principal
attempts to deprive the agent of any portion of a com-
mission due the agent. Courts have often applied this
rule to prevent overreaching by employers and the for-
feiture by employees of benefits almost earned by the
rendering of substantial services.’’ (Citation omitted.)
Id., 104–105.
Thus, although an employer may terminate the
employee at will; see Magnan v. Anaconda Industries,
Inc., supra, 193 Conn. 572; the employer may not act
in bad faith to prevent paying the employee commis-
sions he reasonably expected to receive for services
rendered under the contract. See id., 571, 572 (leaving
open, but not disapproving of, application of good faith
principle to employment contracts in restricted manner
illustrated by Massachusetts cases, nonetheless empha-
sizing that principle’s ‘‘essence is the fulfillment of the
reasonable expectations of the parties’’); see also Coch-
ran v. Quest Software, Inc., 328 F.3d 1, 8 (1st Cir. 2003)
(‘‘[t]he rationale behind [the Massachusetts] exception
is that every contract contains a covenant of good faith
and fair dealing, and an employer breaches that cove-
nant when it dismisses an at-will employee in order to
deprive him of compensation fairly earned and legiti-
mately expected for services already rendered’’), citing
Mullowney v. Data General Corp., supra, 143 F.3d
1083–84; Wakefield v. Northern Telecom, Inc., 769 F.2d
109, 112 (2d Cir. 1985) (‘‘[w]here . . . a covenant of
good faith is necessary to enable one party to receive
the benefits promised for performance, it is implied by
the law as necessary to effectuate the intent of the
parties’’).
To be clear, an employer does not act in bad faith
solely by refusing to pay commissions on sales invoiced
after an employee’s termination if that obligation is
an express contract term. See Magnan v. Anaconda
Industries, Inc., supra, 193 Conn. 567, 572; see also
Mullowney v. Data General Corp., supra, 143 F.3d 1084
and n.4. An employer’s action or inaction that attempts
to avoid the spirit of the bargain or which evinces a
dishonest purpose, however, would violate the implied
covenant of good faith and fair dealing as it relates to
the contractual provision for payment of commissions.
See Empower Health, LLC v. Providence Health Solu-
tions LLC, Docket No. 3:10-CV-1163 (JCH), 2011 WL
2194071, *8 (D. Conn. June 3, 2011) (finding that plaintiff
stated cause of action for breach of implied covenant
of good faith and fair dealing under Connecticut law
because plaintiff could not have reasonably expected
that defendant would actively interfere with plaintiff’s
ability to earn commissions under agreement pursuant
to which plaintiff contracted to promote defendant’s
software and consulting services, especially in light of
fact that sales commissions were only form of compen-
sation), citing De La Concha of Hartford, Inc. v. Aetna
Life Ins. Co., supra, 269 Conn. 432, and Renaissance
Management Co. v. Connecticut Housing Finance
Authority, 281 Conn. 227, 240, 915 A.2d 290 (2007);
Mullowney v. Data General Corp., supra, 143 F.3d 1084
(finding that, under Massachusetts law, employee could
attempt to show that employer violated its implied duty
of good faith and fair dealing by somehow interfering
with employee’s ability to secure commissions); see
also Wakefield v. Northern Telecom, Inc., supra, 769
F.2d 112–13 (‘‘in circumstances in which agents or
employees cannot be directly supervised and their per-
formance cannot be effectively monitored or measured
apart from concrete results . . . an unfettered right to
avoid payment of earned commissions in the principal
or employer creates incentives counterproductive to
the purpose of the contract itself in that the better the
performance by the employee, the greater the tempta-
tion to terminate’’).
In the present case, the trial court considered the
plaintiff’s claim that the covenant was breached to be
essentially the same as a wrongful discharge claim. A
breach of the implied covenant of good faith and fair
dealing contract claim, however, is different than a
wrongful termination claim because the former focuses
on the fulfillment of the parties’ reasonable expecta-
tions rather than on a violation of public policy.13 As
articulated in Wakefield v. Northern Telecom, Inc.,
supra, 769 F.2d 112, while an at-will employee may not
be able to ‘‘recover for his termination per se . . . the
contract for payment of commissions creates rights
distinct from the employment relation, and . . . obliga-
tions derived from the covenant of good faith implicit
in the commission contract may survive the termination
of the employment relationship. Implied contractual
obligations may coexist with express provisions which
seemingly negate them where common expectations
or the relationship of the parties as structured by the
contract so dictate. . . . A covenant of good faith
should not be implied as a modification of an employer’s
right to terminate an at-will employee because even a
whimsical termination does not deprive the employee
of benefits expected in return for the employee’s perfor-
mance. This is so because performance and the distribu-
tion of benefits occur simultaneously, and neither party
is left high and dry by the termination.
‘‘Where, however, a covenant of good faith is neces-
sary to enable one party to receive the benefits prom-
ised for performance, it is implied by the law as
necessary to effectuate the intent of the parties. . . .
[A contract] cannot be read to enable the defendant to
terminate an employee for the purpose of avoiding the
payment of commissions which are otherwise owed.
Such an interpretation would make the performance
by one party the cause of the other party’s [nonperform-
ance].’’ (Emphasis added; citations omitted.) Accord
Arbeeny v. Kennedy Executive Search, Inc., 71 App.
Div. 3d 177, 184, 893 N.Y.S.2d 39 (2010) (‘‘[a]lthough an
at-will employee such as [the] plaintiff would not be
able to sue for wrongful termination of the contract
[under New York law], he should nonetheless be able
to state a claim that the employer’s termination action
was specifically designed to cut off commissions that
were coming due to the employee’’).14
We find the reasoning in Fortune, Wakefield and
Arbeeny persuasive, and therefore, recognize the avail-
ability of a breach of the implied covenant of good faith
and fair dealing contract claim when the termination
of an employee was done with the intent to avoid the
payment of commissions.
Turning to the allegations of the plaintiff’s complaint
in the present case, the plaintiff claims in relevant part
that the defendant had ‘‘failed to pay commissions due
to [the] [p]laintiff on certain sales made’’ and as such,
the ‘‘[d]efendant’s aforementioned conduct violated the
implied covenant of good faith and fair dealing by failing
to comply with [the] [p]laintiff’s reasonable expectation
that the [d]efendant would pay commissions earned
by the [p]laintiff.’’ These allegations focus on damages
suffered due to the violation of the plaintiff’s reasonable
expectation regarding the payment of commissions.15
If an employer can be shown to have interfered in bad
faith with an employee’s ability to secure his commis-
sions, this would violate the reasonable expectation
that his employer would not inhibit his ability to earn
commissions he worked for under the contract. See
Empower Health, LLC v. Providence Health Solutions,
LLC, supra, 2011 WL 2194071, *8; Mullowney v. Data
General Corp., supra, 143 F.3d 1083–84. Accordingly,
on the basis of the allegations in the complaint, the
plaintiff has stated a legally sufficient claim for breach
of the implied covenant of good faith and fair dealing.
B
As to the plaintiff’s wrongful discharge against public
policy count, we agree with the trial court that it should
have been stricken. ‘‘In Sheets v. Teddy’s Frosted Foods,
Inc., [179 Conn. 471, 475, 427 A.2d 385 (1980)] . . . we
recognized . . . a common law cause of action in tort
for discharges if the former employee can prove a
demonstrably improper reason for dismissal, a reason
whose impropriety is derived from some important vio-
lation of public policy. . . . This public policy excep-
tion to the employment [at-will] rule carved out in
Sheets attempts to balance the competing interests of
[the] employer and [the] employee. Under the excep-
tion, the employee has the burden of pleading and prov-
ing that his dismissal occurred for a reason violating
public policy. The employer is allowed, in ordinary cir-
cumstances, to make personnel decisions without fear
of incurring civil liability. Employee job security, how-
ever, is protected against employer actions that contra-
vene public policy.’’ (Citations omitted; emphasis
omitted; internal quotation marks omitted.) Morris v.
Hartford Courant Co., supra, 200 Conn. 678–79.
‘‘The question of whether a challenged discharge vio-
lates public policy . . . is a question of law to be
decided by the court . . . .’’ Faulkner v. United Tech-
nologies Corp., 240 Conn. 576, 588, 693 A.2d 293 (1997).
‘‘In Morris v. Hartford Courant Co., supra, [200 Conn.
680], we recognized the inherent vagueness of the con-
cept of public policy and the difficulty encountered
when attempting to define precisely the contour of the
public policy exception. In evaluating claims, [w]e look
to see whether the plaintiff has . . . alleged that his
discharge violated any explicit statutory or constitu-
tional provision . . . or whether he alleged that his
dismissal contravened any judicially conceived notion
of public policy. . . . Faulkner v. United Technologies
Corp., [supra, 580–81].’’ (Internal quotation marks omit-
ted.) Thibodeau v. Design Group One Architects, LLC,
260 Conn. 691, 698–99, 802 A.2d 731 (2002).
‘‘[W]e repeatedly have underscored our adherence to
the principle that the public policy exception to the
general rule allowing unfettered termination of an at-
will employment relationship is a narrow one . . . .
Consequently, we have rejected claims of wrongful dis-
charge that have not been predicated upon an employ-
er’s violation of an important and clearly articulated
public policy.’’ (Citations omitted; internal quotation
marks omitted.) Id., 701.
In his reply brief, the plaintiff points us to the wage
statutes and suggests that they espouse the important
public policy in favor of the payment of wages, which
the defendant contravened with his termination. Con-
sistent with our conclusion in part I of this opinion,
however, the wage statutes promote a public policy
favoring the payment of earned wages. They should not
be read to provide a broader public policy mandate
than that which is represented. See Daley v. Aetna
Life & Casualty Co., 249 Conn. 766, 804, 734 A.2d 112
(1999) (‘‘In declining to recognize an important public
policy to that effect, we are mindful that we should not
ignore the statement of public policy that is represented
by a relevant statute. . . . Nor should we impute a
statement of public policy beyond that which is repre-
sented. To do so would subject the employer who main-
tains compliance with express statutory obligations to
unwarranted litigation for failure to comply with a here-
tofore unrecognized public policy mandate.’’ [Citation
omitted.]). In other words, while the wage statutes pro-
vide a remedy for unpaid earned wages, they do not
provide one for unearned wages that were not due.
Mytych v. May Dept. Stores Co., supra, 260 Conn. 162.
As we have determined in this case that the commis-
sion provision provided is enforceable and does not
violate the public policy embodied in § 31-72, the exer-
cise of the defendant’s at-will right to terminate the
plaintiff does not violate statutorily based public
policy.16
We acknowledge that the plaintiff goes beyond statu-
torily based public policy in his complaint. The plaintiff
alleges that his employment was terminated ‘‘as a pre-
text to deprive him of the just fruits of his labor’’ and that
this violates ‘‘the public policy of justly compensating
employees for their work.’’ We believe, however, that
the parameters of the public policy of this state with
regard to the payment of wages is reflected in the wage
statutes and that an employee cannot use the nonpay-
ment of wages that have not accrued as the basis for
a wrongful discharge claim. We leave it to the legislature
to decide if it wishes to expand this public policy to
include unearned wages in this context. See Thibodeau
v. Design Group One Architects, LLC, supra, 260 Conn.
715; Magnan v. Anaconda Industries, Inc., supra, 193
Conn. 572. Consequently, we agree with the judgment
of the trial court striking this count.17
The judgment is reversed only with respect to the
trial court’s determination that the agreement violated
public policy and § 31-72, and with respect to that
court’s granting of the motion to strike the count of the
complaint alleging breach of the implied covenant of
good faith and fair dealing, and the case is remanded
with direction to deny the motion to strike that count
of the complaint and for further proceedings according
to law.
In this opinion the other justices concurred.
* This case originally was scheduled to be argued before a panel of this
court consisting of Chief Justice Rogers and Justices Palmer, Zarella, Eve-
leigh, McDonald, Espinosa and Robinson. Although Justice Eveleigh was
not present when the case was argued before the court, he has read the
briefs and appendices, and listened to a recording of the oral argument
prior to participating in this decision.
1
The defendant appealed, and the plaintiff cross appealed, to the Appellate
Court from a stipulated judgment in favor of the plaintiff and against the
defendant for unpaid commissions, but preserving their respective appeal
rights. We transferred both the appeal and the cross appeal to this court
pursuant to General Statutes § 51-199 (c) and Practice Book § 65-1.
2
General Statutes (Supp. 2016) § 31-72 provides in relevant part: ‘‘When
any employer fails to pay an employee wages in accordance with the provi-
sions of sections 31-71a to 31-71i, inclusive, or fails to compensate an
employee in accordance with section 31-76k or where an employee or a
labor organization representing an employee institutes an action to enforce
an arbitration award which requires an employer to make an employee
whole or to make payments to an employee welfare fund, such employee
or labor organization shall recover, in a civil action, (1) twice the full amount
of such wages, with costs and such reasonable attorney’s fees as may be
allowed by the court, or (2) if the employer establishes that the employer
had a good faith belief that the underpayment of wages was in compliance
with law, the full amount of such wages or compensation, with costs and such
reasonable attorney’s fees as may be allowed by the court. Any agreement
between an employee and his or her employer for payment of wages other
than as specified in said sections shall be no defense to such action. . . .’’
Although § 31-72 was amended subsequent to the time the plaintiff filed
his complaint in the present action; see Public Acts 2015, No. 15-86, § 2;
those changes are not relevant to this appeal. For purposes of convenience,
references herein are to the current revision of the statute that is codified
in the 2016 Supplement.
The definition of ‘‘wages’’ under § 31-72 includes commissions. See Gen-
eral Statutes § 31-71a (3) (‘‘‘[w]ages’ means compensation for labor or ser-
vices rendered by an employee, whether the amount is determined on a
time, task, piece, commission or other basis of calculation’’). On appeal,
the defendant does not challenge that these commissions were wages.
3
Due to our holding, we need not address the plaintiff’s additional cross
appeal issue concerning the trial court’s denial of an award of double dam-
ages and attorney’s fees pursuant to § 31-72. With regard to the plaintiff’s
discovery requests, the issue may be addressed on remand.
4
The parties do not dispute that the plaintiff procured the accounts at
issue.
5
After this determination, the plaintiff amended his complaint to add a
claim of unjust enrichment. The defendant then moved for summary judg-
ment on the violation of § 31-72 count, however, the trial court denied the
motion. The plaintiff claims that his unjust enrichment claim was part of the
stipulated judgment entered in his favor. Because this claim is inadequately
briefed and is not relevant to our determinations, we do not address this
argument.
6
In the parties’ stipulation, the plaintiff conceded that he understood the
provision in the 2006 sales incentive plan, which provides that ‘‘[u]pon the
[manager’s] termination of employment, all commissions cease,’’ to mean
that he was not entitled to commissions on invoices executed after his
termination date.
7
See General Statutes § 31-71e (permitting partial withholding of wages
under certain circumstances).
8
We agree with the defendant that the plaintiff’s claim that the 2006 sales
incentive plan was not a contract is not preserved. Additionally, as we
explain in part II A of this opinion, the implied covenant of good faith and
fair dealing attaches to specific contract terms and if the sales incentive
plan is not part of the agreement between the plaintiff and the defendant,
the plaintiff’s newly revived second count would not be available. We also
note that the plaintiff signed the 2006 sales incentive plan and continued
to work and receive compensation.
9
General Statutes § 31-71b (a) (1) provides in relevant part: ‘‘[E]ach
employer, or the agent or representative of an employer, shall pay weekly
all moneys due each employee on a regular pay day, designated in advance
by the employer, in cash, by negotiable checks or, upon an employee’s
written request, by credit to such employee’s account in any bank that has
agreed with the employer to accept such wage deposits.’’
10
Although the plaintiff claims that the commission provision causes an
unacceptable forfeiture of wages earned, we agree with the defendant that
the trial court’s reliance on our forfeiture jurisprudence in Aetna Casualty &
Surety Co. v. Murphy, 206 Conn. 409, 414–15, 538 A.2d 219 (1988), overruled
on other grounds by Arrowood Indemnity Co. v. King, 304 Conn. 179, 201,
39 A.3d 712 (2012), is inapplicable to the current situation because we have
determined that the plaintiff had not earned the commissions under the
employment agreement.
11
‘‘Essentially [the implied covenant of good faith and fair dealing] is a
rule of construction designed to fulfill the reasonable expectations of the
contracting parties as they presumably intended. The principle, therefore,
cannot be applied to achieve a result contrary to the clearly expressed terms
of a contract, unless, possibly, those terms are contrary to public policy.’’
Magnan v. Anaconda Industries, Inc., 193 Conn. 558, 567, 479 A.2d 781
(1984).
12
The court in Fortune v. National Cash Register Co., supra, 373 Mass.
102, noted that while some other courts had fashioned a remedy in tort to
avoid the rigidity of the ‘‘at will’’ rule, it believed that there was a remedy
based on the contract. See Siles v. Travenol Laboratories, Inc., 13 Mass.
App. 354, 358, 433 N.E.2d 103 (1982) (distinguishing bad faith termination
claim that involved intent to benefit financially at employee’s expense, such
as retaining sales commissions that would otherwise be due employee as
in Fortune, from bad faith termination claim where employer’s reason for
discharge was contrary to public policy). The Massachusetts Supreme Judi-
cial Court subsequently stated that the employer’s predatory motivation in
Fortune could be classified as a reason contrary to public policy. See Cort
v. Bristol-Myers Co., 385 Mass. 300, 303, 431 N.E.2d 908 (1982); Magnan v.
Anaconda Industries, Inc., supra, 193 Conn. 570 n.20 (identifying that in
Massachusetts there was wrongful termination cause of action based on
contractual implied covenant of good faith and fair dealing where employer’s
predatory motivation was in violation of public policy); see also Hunt v.
Wyle Laboratories, Inc., 997 F. Supp. 84, 90–91 (D. Mass. 1997) (describing
three separate lines of Massachusetts cases that all ‘‘stand together under
a public policy umbrella’’).
13
Under such a claim, termination is incidental, or a means, to accomplish
the breach of the implied covenant of good faith and fair dealing. Cf., e.g.,
Empower Health, LLC v. Providence Health Solutions, LLC, supra, 2011
WL 2194071, *8 (plaintiff limited liability company alleged that defendant
deliberately prevented plaintiff from closing on sales it initiated by assuming
control over relationships with plaintiff’s sales leads, removing plaintiff’s
access to sales system, and terminating plaintiff’s e-mail account).
14
In Wakefield v. Northern Telecom, Inc., supra, 769 F.2d 111–13, in analyz-
ing New Jersey and New York law, the Second Circuit Court of Appeals
held that the jury could have awarded damages if it found that the employer
discharged the employee in order to avoid paying him commissions earned
on sales that were completed but for formalities. In Arbeeny v. Kennedy
Executive Search, Inc., supra, 71 App. Div. 3d 183–84, the court held that
an at-will employee could state a claim for breach of contract to recover
unpaid earned commissions.
15
The defendant claims that ‘‘the plaintiff did not allege that [he was fired]
in order to deprive him of commissions that he might have earned at some
unknown time in the future’’ due to the plaintiff’s numerous assertions that
the alleged commissions were ‘‘earned’’ and ‘‘due to him.’’ Reading the
complaint broadly, as we must, we find this argument unpersuasive. We
believe that, although the plaintiff had not ‘‘earned’’ the commissions under
the wage statutes, he may yet be able to demonstrate that he was nevertheless
‘‘owed’’ them because he was prevented from earning them due to the
employer’s breach of the implied covenant of good faith and fair dealing.
In the present case, the plaintiff did allege that the defendant’s ‘‘reasons
for [his] termination were false and a pretext for nonpayment of owed
commissions.’’ (Emphasis added.)
16
Based on our discussion in part II A of this opinion, if an employer
exercises the right to terminate in order to interfere in bad faith with an
employee’s ability to secure commissions, however, the employee’s reason-
able expectations would be violated and he or she can recover in contract.
17
Due to our determination, we need not address the defendant’s argu-
ment, based on Burnham v. Karl & Gelb, P.C., supra, 252 Conn. 153, regard-
ing the adequacy of the statutory remedy under § 31-72.