Fairchild v. All Am. Check Cashing, Inc.

• Decision Date: 18 March 2016
• Docket Number: No. 15–60190.,15–60190.
• Citation: 815 F.3d 959
• Parties: Ambrea FAIRCHILD, Plaintiff–Appellant, v. ALL AMERICAN CHECK CASHING, INCORPORATED, a Mississippi Corporation, Defendant–Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

815 F.3d 959

Ambrea FAIRCHILD, Plaintiff–Appellant,

v.ALL AMERICAN CHECK CASHING, INCORPORATED, a Mississippi Corporation, Defendant–Appellee.

No. 15–60190.

United States Court of Appeals, Fifth Circuit.

March 18, 2016.

Daniel Myers Waide, Esq., Johnson, Ratliff & Waide, Hattiesburg, MS, for Plaintiff–Appellant.

Robin H. Rasmussen, Megan Leigh Black, Dinkelspiel Rasmussen & Mink, P.L.L.C., Memphis, TN, Lucius F. Sams, Jr., Esq., Mitchell, McNutt & Sams, Tupelo, MS, for Defendant–Appellee.

Before PRADO, OWEN, and HAYNES, Circuit Judges.

ON PETITION FOR REHEARING

EDWARD C. PRADO, Circuit Judge:

Treating Appellant's Petition for Rehearing En Banc as a Petition for Panel Rehearing, the Petition for Panel Rehearing is DENIED, but we withdraw the prior opinion, 811 F.3d 776 (5th Cir.2016), and substitute the following, which is amended only as to Part II.A:

Ambrea Fairchild sued her former employer, All American Check Cashing, Inc. ("All American"), alleging it violated Title VII of the Civil Rights Act of 1964 ("Title VII"), as amended by the Pregnancy Discrimination Act ("PDA"), 42 U.S.C. § 2000e(k), by firing her because she was pregnant. She also alleged that All American violated the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 207(a), by failing to pay her overtime. After the close of Fairchild's case in chief at trial, the district court entered judgment in favor of All American on both claims. Finding no error, we affirm.

I. BACKGROUND

In December 2011, Ambrea Fairchild was hired by All American, a Mississippi-based loan and check cashing company. After a brief training period, Fairchild started work as a manager trainee at All American's store in Hattiesburg, Mississippi. She was paid hourly, and her responsibilities included cashing checks, issuing loans, and making reminder and "past due" phone calls to assist with debt collection.

All American promoted Fairchild in March 2012 to manager, a salaried position. Her duties largely stayed the same, although she also became responsible for training other employees. During her time as manager, All American issued her several written complaints regarding her performance. In May 2012, she received a write up after a register drawer was missing one hundred dollars. In July 2012, she received a citation for failing to follow instructions after she kept the store open past All American's prescribed closing time. The next month she received a written warning related to her "general inefficiency." She received three more warnings in the first half of September 2012. One warning cited her failure to train manager trainees and another indicated she needed to "slow down and pay attention" when processing transactions. All American also issued a "final warning" for "general inefficiency," which related to the accrual of "bad debt" at the store and her failure to issue a sufficient number of loans.

In late September 2012, All American demoted Fairchild back to the manager trainee position. Fairchild testified at trial that the demotion was justified because she needed "to work on [her] weaknesses." Her manager became Daniel Fowler, an individual that Fairchild had previously trained. While acting as her manager, Fowler issued Fairchild performance-related warnings, which included a December 2012 document informing Fairchild that All American had "zero tolerance" for "threatening phone calls" and "poor attitudes." Fowler also testified that Fairchild caused low morale at the Hattiesburg store. The issue with store morale led to problems with customer service that, in turn, resulted in excessive customer complaints.

Fowler and Fairchild also had a strained working relationship in part because Fairchild often complained about him to their supervisors. As Fairchild admitted in her testimony, the two would frequently argue over "minor things," and she would report Fowler's actions to her then-supervisors. As a result of these issues, Fowler informed his new supervisor, Mark Hendrix, that Fairchild was interfering with his ability to effectively manage the Hattiesburg store.

In October 2012, Fairchild learned she was pregnant. She told her then-supervisor, Mandy Hearn, and her manager, Fowler, of her pregnancy in late November 2012. On January 23, 2013, All American terminated Fairchild. Two days earlier, Mark Hendrix, who held another position in All American, became acting supervisor of the Hattiesburg store.

All American's overtime policy prohibited hourly employees from working overtime without prior approval from a manager or supervisor. Further, its policy required that all employees accurately report their hours in its designated timekeeping system. During Fairchild's time as manager trainee, All American paid her for the overtime that it authorized and that she recorded in its timekeeping system. Fairchild, however, testified that she also worked additional overtime that she did not report through the specified timekeeping system and for which she was not paid.

In May 2013, Fairchild sued All American in federal district court. Her complaint alleged that All American terminated her because of her pregnancy in violation of Title VII and failed to pay her overtime wages in violation of the FLSA. Before trial, the parties agreed that the FLSA claim would be decided by the judge and the Title VII claim would be decided by a jury, although they would present both claims at a single trial. The trial took place in February 2015. After the close of Fairchild's case in chief, the district court granted All American's motion for judgment in its favor on both claims. Fairchild timely appealed.

II. DISCUSSION

A. The FLSA Claim

The parties agreed to a bench trial for the FLSA claim. In a bench trial, a judgment entered after the plaintiff's case in chief is appropriately decided under Federal Rule of Civil Procedure 52(c),¹ which provides for a judgment on partial findings.² Bursztajn v. United States, 367 F.3d 485, 488 (5th Cir.2004). When the district court enters a Rule 52(c) judgment, we review its factual findings for clear error and its conclusions of law de novo. Id. at 488–89.

Under the FLSA, an employer must pay covered employees overtime compensation that is "not less than one and one-half times [that employee's] regular rate" for all hours worked over forty in a workweek. 29 U.S.C. § 207(a)(1). "An employer who is armed with [knowledge that an employee is working overtime] cannot stand idly by and allow an employee to perform overtime work without proper compensation, even if the employee does not make a claim for the overtime compensation." Harvill v. Westward Commc'ns, L.L.C., 433 F.3d 428, 441 (5th Cir.2005) (alteration in original) (quoting Newton v. City of Henderson, 47 F.3d 746, 748 (5th Cir.1995) ). An employee, however, cannot prevail on an FLSA overtime claim if that "employee fails to notify the employer or deliberately prevents the employer from acquiring knowledge of the overtime work." Id. (quoting Newton, 47 F.3d at 748 ); see also Brumbelow v. Quality Mills, Inc., 462 F.2d 1324, 1327 (5th Cir.1972).

In Newton v. City of Henderson, the plaintiff, a police officer, brought an FLSA claim for overtime against his employer, the City of Henderson (the "City"). 47 F.3d at 747. During the period at issue, the plaintiff was assigned to work for a task force with the U.S. Drug Enforcement Agency, although the City remained responsible for his salary. Id. The City's personnel policy required that all employees "obtain approval prior to working overtime," id., and report those hours on a specified payroll form, id. at 749. The City paid the plaintiff for all of the hours he reported on the payroll forms; it did not pay him for the unauthorized overtime that he failed to properly report. Id. at 748.

The plaintiff in Newton argued that despite his failure to follow protocol, he was owed compensation for unpaid overtime because "he reported his activities to [the City] on a daily basis," although not the specific number of hours worked, and that, as a result, the City had constructive knowledge of his overtime hours. Id. After the trial court granted judgment for the plaintiff, we reversed and rendered judgment in favor of the City. Id. at 746–47. We emphasized that his employer had expressly ordered the plaintiff not to work overtime; the plaintiff had ignored the procedures for reporting such overtime; and no other evidence established that his supervisors should have known he was required to work overtime. Id. at 749–50. We also highlighted that this was not a case in which the defendant "encouraged or forced [the plaintiff] to submit incorrect time sheets." Id. at 750.

Fairchild, on appeal, alleges All American failed to pay her overtime for the two periods in which she worked as a manager trainee—December 2011 through March 2012 and September 2012 through January 2013. During this time, Fairchild was paid for the overtime hours she reported through All American's timekeeping system. However, she now seeks payment for the alleged overtime hours that she worked but did not report to All American. The district court denied overtime compensation for both periods. We hold that it did not clearly err in not accepting Fairchild's assertions that All American had actual or constructive knowledge that she worked overtime for which she had not been paid.

With regard to the first period as manager trainee, Fairchild—like the plaintiff in Newton —ignored her employer's policy and procedures: she neither sought authorization to work such overtime nor reported the alleged hours through All American's timekeeping system. Id. at 749. Indeed, Fairchild testified that she intentionally failed to report her unauthorized overtime specifically because All American prohibited such overtime. To hold that she is entitled to deliberately evade All American's policy would improperly deny All American's "right to require an employee to adhere to its procedures for claiming overtime." Id.; see also White v....