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Winters v. American Express Tax and Business Services

February 27, 2007


The opinion of the court was delivered by: Kenneth M. Karas, District Judge


Plaintiff Bruce I. Winters brings this action to recover money allegedly owed to him by his former employer, Defendant American Express Tax and Business Services, Inc. ("TBS"). Specifically, Plaintiff alleges that when TBS terminated his employment on February 11, 2003, TBS owed him a minimum of $33,333.33 in deferred partnership income, $15,340.00 in incentive pay, and $20,595.95 in paid time off ("PTO"). (Pl.'s Mem. of Law in Opp'n to Mot. for Summ. J. ("Pl.'s Mem.") 5-7.) Plaintiff further alleges that TBS wrongfully deducted funds from his wages, in violation of New York Labor Law section 193(a). (Id. at 17-19.) With this motion, TBS seeks summary judgment with respect to each of Plaintiff's outstanding claims. For the reasons stated below, TBS's Motion for Summary Judgment is GRANTED in part and DENIED in part.

I. Background

Plaintiff and TBS present dramatically different versions of the facts. These differences, upon which this motion turns, are identified below. The Parties agree that Plaintiff began working for TBS on June 4, 1999, as a "Band-35" Senior Manager responsible for technology-related matters at TBS's New York office.*fn1 (Pl.'s Rule 56.1 Counter-Statement of Material Facts in Supp. of His Opp'n to Def.'s Mot. for Summ. J. ("Pl.'s 56.1 Stmt.") ¶ 6.) The Parties also agree that on February 11, 2003, Plaintiff was discharged from his positions at TBS and GGK and performed no further work for the companies. (Winters Dep. 27:9-29:15; Def.'s Rule 56.1 Statement of Undisputed Material Facts ¶ 29 ("Def.'s 56.1 Stmt.").) What happened between June 4, 1999 and February 11, 2003 is what this lawsuit is all about.

A. Plaintiff's Relationship to GGK and the Deferred Compensation Plan

In July 2000, Plaintiff was promoted to Band-40 Lead Managing Director at TBS. (Pl.'s 56.1 Stmt. ¶¶ 8, J.) Plaintiff also claims that around this time he was promoted to partner at Goldstein, Golub and Kessler ("GGK"), an entity that he identifies as a wholly-owned subsidiary of TBS. (Winters Aff. ¶ 7; Winters Dep. 34:2-12.) According to Plaintiff, he was invited to join the GGK partnership by Gerry Golub ("Golub"), the "president of GGK and the chairman of TBS." (Winters Dep. 34:7-9, 46:25-47:8.) In several subsequent conversations, Golub allegedly also informed Plaintiff of the responsibilities and benefits attendant to the partnership position.

(Id. at 47:6-13.) Plaintiff never received a written partnership agreement memorializing either his promotion or the responsibilities and benefits of partnership as presented by Golub. (Id. at 46:3-4.)

Among the partnership benefits purportedly agreed to by Plaintiff and Golub was the opportunity to receive what Plaintiff alternately refers to as "deferred compensation," "Partnership Income," and "Partnership Distribution." (Id. at 47:6-13; Winters Aff. ¶ 15.) Plaintiff defines deferred compensation as "the monies you received at the end of the year, that included your share of the equity, your share of the profits and your share . . . in GGK, that was left from what you had not drawn during the year as a salary." (Winters Dep. 62:20-25.) However, Plaintiff admits that he does not know how this amount was calculated. (See id. at 262:22-25.) Although the so-called deferred compensation was allegedly related to Plaintiff's partnership in GGK, it was paid by TBS. (Id. at 64:14-16.) And while this compensation was paid in a lump sum, according to Plaintiff, it was not a bonus. (Id. at 49:9-10.)

Plaintiff claims that over the course of his employment at TBS he received two such deferred compensation payments: In 2001, he received deferred compensation of $57,432 relating to his employment from May 1, 2000 through April 30, 2001 (id. at 189:25-192:16); and in 2002 he received deferred compensation of $49,096 for his employment from May 1, 2001 through April 30, 2002. (Id. at 198:6-20.) Plaintiff believes that he was entitled to an additional deferred compensation payment for the work that he performed from May 1, 2002, through the date of his termination, which Plaintiff estimates is $33,333.33.*fn2

TBS disputes Plaintiff's characterization of these payments. In TBS's view, the lump sum payments that Plaintiff received in 2001 and 2002 were bonus or incentive payments, not deferred compensation. (See Def.'s 56.1 Stmt. ¶¶ 40-42, 71; Price Decl. ¶ 27.) TBS acknowledges that it offered a "deferred compensation plan" to some employees, but claims that that plan was only available to "senior level employees, starting with Band 50-level Vice Presidents and above," and that "Mr. Winters was not eligible to participate and did not participate" in any such plan. (Price Decl. ¶¶ 37-38.)

B. The Incentive Award Program

On October 1, 2001, TBS launched the Incentive Award Program ("Incentive Program"). (Price Decl. ¶ 16; Winters Dep. 200:8-12; Park Aff. Ex. N.) According to Plaintiff, prior to the roll-out of the Incentive Program, TBS had regularly issued discretionary bonuses to its employees under varying plans and based on subjective criteria. (Winters Dep. 181:12-14; see also Price Aff. ¶ 28.) The Incentive Program was intended to replace these discretionary bonuses with a unified and more objective system. (Winters Dep. 180:20-25.) Towards that end, the Incentive Program "plan description" explained in detail how the Incentive Program awards were calculated, setting forth several quantifiable criteria, including individual achievement ratings and office performance. (Park Aff. Ex. N.) The plan description, which Plaintiff acknowledges having read (Winters Dep. 179:12-17), also included a "switching plans proration" provision, under which any Incentive Award would be prorated in cases where an eligible employee was already being compensated through a different TBS incentive program. (Id.) This proration provision was intended to prevent employees from being compensated under two separate incentive programs for work performed during the same period, thereby receiving a windfall.

(Id.; Price Aff. ¶¶ 24-26.)

Plaintiff acknowledges that he received two payments under a discretionary bonus regime that preceded the Incentive Program: In January 2000, he received a $15,000 bonus payment; and in March 2000, he received a $25,000 bonus payment. (Winters Dep. 197:5-15.) Plaintiff further acknowledges that he received lump sum payments of $57,432 in September 2001 and $49,096 in September 2002; however, Plaintiff claims that these later payments were not bonus or incentive payments, but rather the deferred GGK partnership compensation discussed above. (Id. at 199:7-14.) Plaintiff also acknowledges receiving a payment of $38,000 in January 2003.*fn3

(Winters Aff. ¶ 17.) Plaintiff argues that the switching-plans proration provision did not apply to him and he is therefore entitled to an Incentive Program award for the first year of the program. Moreover, Plaintiff claims that in the last quarter of 2002, his manager, Jeffrey Geisler ("Geisler"), confirmed as much, promising Plaintiff that he would receive an Incentive Program award in the amount of 25.4% of his annual salary, or $53,340. (Id. at 227:12-24; Winters Decl. ¶ 17.) Thus, having been paid $38,000 in January 2003, Plaintiff seeks the difference of $15,340.

In contrast, TBS argues that Plaintiff was ineligible for an Incentive award during the first year of the Incentive Program because he was covered under a separate bonus program. TBS points to the lump sum payment that Plaintiff received in September 2002, arguing that this payment was not deferred compensation, as Plaintiff claims, but was instead an "annual bonus payment . . . for the period [of] May1, 2001 through April 30, 2002." (Price Aff. ¶ 27.) As such, the proration provision of the Incentive Program applied, and Plaintiff was "not entitled to additional monies under the Incentive Program over this same time period." (Id.)

C. Paid Time Off

During the period at issue, vacation days, personal days, and "business driven holidays" were all addressed at TBS through its written Paid Time Off ("PTO") policy. (Park Aff. Ex. F.) Pursuant to the PTO policy, employees of Plaintiff's band level and seniority accrued 224 hours of PTO each year. (Def.'s 56.1 Stmt. ¶ 13.) The PTO policy required that any PTO hours "be taken in the calendar year in which they are earned . . . . [or else] be forfeited." (Park Aff. Ex. F.) However, both Plaintiff and TBS acknowledge that there was an unwritten exception to the PTO policy, under which employees were permitted to carry PTO hours into subsequent years under "extraordinary business circumstances." (Winters Dep. 109:5-13, 131:2-25, 145:16-18; Geisler Dep. 110:24-112:22.)

Plaintiff claims that, due to such extraordinary business circumstances, Geisler granted Plaintiff permission to carry forward his vacation time from 2001 into 2002, and that Geisler and Kent Price ("Price") together permitted him to carry vacation time from 2002 into 2003.*fn4

(Winters Dep.109:5-13, 131:2-25, 142:25-143:21, 145:16-18, 146:9-21.) Plaintiff further claims that these agreements are evidenced in emails sent among Plaintiff, Geisler, and Price. (Winters Aff. ¶ 20; Park Aff. Exs. H-K.) According to Plaintiff's calculations, taking into account the unused PTO hours that Plaintiff carried forward into 2002 and 2003, Plaintiff was owed 287 hours of PTO at the time of his termination. (Winters Aff. ¶¶ 20-21; Park Aff. Ex. J.) Because he was only credited with 147 hours of PTO, he seeks the difference. (See Park Aff. Ex. J.)

TBS does not dispute that Plaintiff was granted permission to carry forward his hours from 2001 into 2002 and again from 2002 into 2003. However, according to TBS, even under extraordinary circumstances, TBS employees were only permitted to carry PTO hours into the first quarter of the year subsequent to which the hours were accrued. Any PTO hours not used in the first quarter of that subsequent year were forfeited. (Price Dep. 49:17-50:4; Park Aff. Ex. H.) According to TBS, in 2002, Plaintiff carried over 213 PTO hours from 2001, accrued 224 new PTO hours, and used only 150 hours. (Def.'s 56.1 Stmt. ¶ 34.) Fifty-four of the hours used by Plaintiff were used during the first quarter of 2002 and were thus charged against the 213 hours that he had carried over from the previous year.*fn5 (Id.) The remaining 96 hours that Plaintiff used in 2002 were deducted from the 224 hours ...

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