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Establishment of an Employee Suggestion Program creates a contractual relationship

Establishment of an Employee Suggestion Program creates a contractual relationship
Daley v County of Erie, 59 AD3d 1087

Patrick L. Daley, an Eric County employee, sued the County alleging that it had violated its Employee Suggestion Program and thus was liable for damages for ?breach of contract,?

Under the Program employees who submitted cost-saving suggestions that were implemented by County were given monetary awards.

When Supreme Court denied the County?s motion to dismiss Daley?s complaint, it appealed but it received no relief from the Appellate Division.

Citing Didley v General Motors Corp., 837 F Supp 535, the court said that "It is well established that the processing of a suggestion pursuant to an employee suggestion plan creates a contractual relationship between the employee and the employer under the rules of the plan."

Accordingly, Supreme Court was correct when it ruled that Daley had stated a cause of action for breach of contract.

The Appellate Division then turned to the County?s contention that even if Daley had stated claim for breach of contract, it was untimely because an Article 78 action had to be commenced within the four-month statute of limitations.

It rejected the County?s theory noting that "The proper vehicle for seeking damages arising from an alleged breach of contract by a . . . governmental body is an action for breach of contract, not a proceeding pursuant to CPLR article 78." The statute of limitations for suing for breach of contract is six years.

Full post as published by New York Public Personnel Law on March 02, 2010 (boomark / email).