Reference no: EM13182062

International business machines corp. (IBM) hired Niels Jensen in 2000 as a software sales representative. in 2001, IBM presented a new software sales incentive plan at a conference for its sales employees. a brochure given to the attendees stated, "there are no caps to your earning; the more you sell, the more earning for you". the brochure outlined how the plan worked and referred the employees to the sales incentive section of IBM's corporate intranet for more details. Jensen was given a quota letter that said he would be paid $75,000 as a base salary and, if he attained his quota, an additional $75,000 as incentive pay. in September, Jensen closed a deal with the U.S. Department of the Treasury's internal revenue worth more than $24 million to IBM. Relying on the Sales incentive plan brochure, Jensen estimated his commission to be $2.6 million. IBM paid him less that $500,000, however, Jensen filed a suit in a federal district court against IBM, contending that the sales incentive plan brochure and quota letter constituted a unilateral offer that become a binding contract when Jensen closed the sale. 

1. would it be fair to the employer in this case to hold that the Sales incentive plan brochure and quota letter created a unilateral contract if IBM did not intend to create such a contract? would it be fair to the employee to hold that no contract was created? 

2. the sales incentive section of IBM'S intranet included a clause providing that management will decide if an adjustment to the payment is appropriate when an employee closes large transaction. Jensen's quota letter stated, the sales incentive plan program does not constitute a promise by IBM to make any distributions under it. IBM reserves the right to adjust the program terms or to cancel or otherwise modify the program at any time. how do these statements affect your answers to the above questions? From an ethical perspective, would it be fair to hold that a contract exists despite these statements?