Pacheco v. Whiting Farms, Inc.

• Citation: 365 F.3d 1199
• Decision Date: 30 April 2004
• Docket Number: No. 03-1170.,03-1170.
• Parties: Veronica PACHECO, Plaintiff-Appellant, v. WHITING FARMS, INC.; Thomas Whiting, individually; and N. Lyle Johnston, individually, Defendants-Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (10th Circuit)

365 F.3d 1199

Veronica PACHECO, Plaintiff-Appellant, v. WHITING FARMS, INC.; Thomas Whiting, individually; and N. Lyle Johnston, individually, Defendants-Appellees.

No. 03-1170.

United States Court of Appeals, Tenth Circuit.

April 30, 2004.

Submitted on the briefs:^* Patricia L. Medige, Colorado Legal Services, Denver, CO, for Plaintiff-Appellant.

Sam D. Starritt and Michael C. Santo, Dufford, Waldeck, Milburn & Krohn, LLP, Grand Junction, CO, for Defendants-Appellees.

Before SEYMOUR, BALDOCK, and LUCERO, Circuit Judges.

BALDOCK, Circuit Judge.

Plaintiff Veronica Pacheco sued Defendants Whiting Farms Inc. and its controlling owners alleging they failed to pay her overtime wages and terminated her employment in violation of the Fair Labor Standards Act (FLSA), 29 U.S.C. §§ 201-219. FLSA generally requires employers to pay their employees one and one-half times the employee's regular rate of pay (overtime) for each hour worked in excess of forty hours during any given week. 29 U.S.C. § 207(a)(1). FLSA's overtime wage requirements do not apply, however, "with respect to... any employee employed in agriculture[.]" Id. § 213(b)(12). FLSA also prohibits retaliation against an employee because she engaged in protected activity under the Act. Id. § 215(a)(3).

The parties filed cross-motions for summary judgment. The district court granted Defendants' motion for summary judgment, holding Defendants were not required to pay Plaintiff overtime wages under FLSA's "agricultural exemption" and Defendants did not terminate Plaintiff in violation of FLSA's anti-retaliation provision.¹ On appeal, Plaintiff argues the district court erred in granting summary judgment because (1) she was not an agricultural employee exempt from the payment of overtime wages under FLSA, and (2) genuine issues of material fact exist regarding whether Defendants terminated her for requesting overtime wages. We have jurisdiction under 28 U.S.C. § 1291. We review the grant of summary judgment de novo, applying the same standard as the district court. Welding v. Bios Corp., 353 F.3d 1214, 1217 (10th Cir.2004). Summary judgment is appropriate where no genuine issues of material fact exist and the moving party is entitled to judgment as a matter of law. Id. Applying this standard, we affirm.

I.

Thomas Whiting and N. Lyle Johnston are the president and vice-president, respectively, of Whiting Farms, Inc. (collectively "Defendants"). Defendants "raise chickens for feathers." Defendants breed, raise, euthanize, and processes chickens for their "pelts" or "hackle." Hackle consists of feathers still attached to the skin (pelts) of the chickens. Hackle is eventually used to tie fishing-flies.

From conception to compost, the chickens raised and euthanized at Whiting Farms never leave Defendants' property. Processing the chickens essentially involves euthanizing the chickens, removing the chickens' pelts, drying the pelts to remove moisture and fat, and trimming the pelts into the desired shape.² The pelt is next graded to determine its value. After grading, the pelt is sent to the packaging department. Packaging employees then separate the pelts according to their previously assigned grade and color, stamp the back of the pelt with its grade designation, and make a record of the pelt. Depending on demand, the pelt is then either placed in bulk storage or packaged.

A pelt goes to storage if it is not needed to fill a current order. The pelt is stored in its natural state (i.e., not in a box). The pelt is perishable if exposed to water or insect infestation; however, if the pelt is stored in a safe and reasonably cool environment it will last years. Conversely, the pelt is packaged immediately if it is needed to fill an order. To package a pelt, an employee staples the pelt onto a board and places it into a zip-lock bag. Next, the packaging employee places a computer generated bar-code on the bag and scans the bar-code, which places the product into a computer operated inventory system. The packaged pelt is then taken to the shipping department. UPS picks up the pelts from the shipping department and delivers them to retailers.

Plaintiff began working in Defendants' packaging department in 1996. Plaintiff's position did not require any specialized training or experience. In August 1999, Defendants promoted Plaintiff to "packaging foreperson." As foreperson, Plaintiff directed day-to-day activities of the packaging staff, scheduled days off, ensured packaging inventories were kept at proper levels, and continued to package pelts. Defendants implemented a new packaging system shortly after Plaintiff's promotion, which operated pursuant to a "Packaging Priority Report." The report informs packaging employees what products need to be packaged to meet the current market demand. Packaging employees then prioritize their duties according to the report.

Plaintiff's employment relationship with Defendants deteriorated after implementation of the Packaging Priority Report system. Plaintiff disagreed with how the new system allocated packaging employees' duties and often felt the Packaging Priority Report was wrong. In February 2000, Defendants met with Plaintiff twice because she was not packaging product correctly. After the second meeting, Defendants informed Plaintiff that further resistance to change would constitute misconduct and could result in disciplinary action. On August 3, 2000, Defendants met with Plaintiff a third time because she had missed a meeting with her immediate supervisor regarding the allocation of job duties within the packaging department and allegedly started a rumor her supervisors were "out to get her." After the meeting, Defendants suspended Plaintiff for one and one-half days without pay for insubordination and misconduct. Defendants also put Plaintiff on notice she would be subject to further disciplinary action, including termination, if her unacceptable behavior continued.

Around August 26, 2000, Plaintiff learned employees in the shipping department received overtime wages. Plaintiff regularly worked over forty-hours per week in the packaging department. Defendants paid Plaintiff her regular rate of pay for all hours worked, but did not pay her overtime wages for those hours worked in excess of forty. Accordingly, Plaintiff asked Defendant Johnston if the "packaging department could get overtime like shipping." Defendant Johnston appeared "nervous and shocked" upon Plaintiff's inquiry but nevertheless informed Plaintiff he would look into the matter. Later that day, Defendant Johnston explained to Plaintiff that packaging employees did not receive overtime wages because they were considered "agricultural." Defendant Johnston further explained shipping employees were not considered "agricultural," and thus entitled to overtime wages, because shipping employees worked with products not wholly produced on Whiting Farms. Plaintiff responded "okay" and went back to work. Plaintiff never mentioned overtime wages to Defendants again.

In October 2000, Plaintiff disregarded her immediate supervisor's orders regarding the allocation of job duties within the packaging department. Defendant Johnston was notified of the situation. Upon arriving in the packaging department, Defendant Johnston observed a large amount of backlogged product and decided Plaintiff needed to be disciplined for her insubordination. After reviewing the situation, Defendants decided Plaintiff's termination was in the best interest of the company. Defendant Whiting made the ultimate decision to terminate Plaintiff because her failure to follow reasonable work-related instructions under the Packaging Priority Report system hindered productivity. On October 17, 2000, Defendants terminated Plaintiff.

II.

Plaintiff first argues the district court incorrectly held she was not entitled to overtime wages under FLSA's agricultural exemption. We narrowly construe FLSA exemptions. Mitchell v. Kentucky Finance Co., 359 U.S. 290, 295, 79 S.Ct. 756, 3 L.Ed.2d 815 (1959). An employer bears the burden of showing its practices plainly and unmistakably fall within the exemption. Ackerman v. Coca-Cola Enter., Inc., 179 F.3d 1260, 1264 (10th Cir.1999).

A.

FLSA prohibits any person from violating the maximum hour provisions of the Act. 29 U.S.C. § 215(a)(2). FLSA's maximum hour provisions require, among other things, employers to pay their employees at a rate not less than one and one-half times the employee's regular rate of pay for each hour, or fraction thereof, the employee worked over forty-hours in a workweek. Id. § 207(a)(1). Section 213(b), however, sets forth several industry-specific exemptions from the Act's maximum hour provisions. Id. § 213(b)(1)-(30). FLSA's agricultural exemption provides the Act's maximum hour provisions "shall not apply with respect to ... any employee employed in agriculture[.]" Id. § 213(b)(12). "The agricultural exemption was meant to apply broadly and to embrace the whole field of agriculture, but it was meant to apply only to agriculture; thus the critical issue is what is and what is not included within that term." Rodriguez v. Whiting Farms, Inc., 360 F.3d 1180, 1185 (10th Cir.2004) (internal quotations and citation omitted). FLSA provides:

"Agriculture" includes farming in all its branches and among other things includes the cultivation and tillage of the soil, dairying, the production, cultivation, growing, and harvesting of any agricultural or horticultural commodities..., the raising of livestock, bees, fur-bearing animals, or poultry, and any practices (including any forestry or lumbering operations) performed by a farmer or on a farm as an incident to or in conjunction with such farming operations, including preparation for market, delivery to storage or to market or to carriers for transportation to market.

29 U.S.C. § 203(f) (emphasis added).

FLSA's definition of agriculture "includes farming in both a primary and a...