5th Circuit holds ex-employee not entitled to overtime and could not establish pretext to pregnancy discrimination

Ambrea Fairchild v All American Check Cashing, Incorporated, a Mississippi Corporation, No. 15-60190 (5th Cir. March 18, 2016).

This is a pregnancy discrimination and FLSA overtime case where the U.S. 5th Circuit affirmed the order granting the employer’s request for judgment. While not specifically a city/government case, it applies all forms of employers.

Fairchild started work as a hourly manager trainee at All American’s store (a loan and check cashing company). Once promoted to a salaried manager, her duties remained similar but she was also responsible for training new employees. While employed, Fairchild received several write-ups for poor performance. After a year, Fairchild was demoted to “work on her weaknesses.” Various reported and documented problems continued.  Then, 11 months after her demotion, Fairchild found out she was pregnant. Two months after advising All American of her pregnancy, Fairchild was terminated. She sued for pregnancy discrimination. She also asserted she was not paid overtime, even though she admitted the overtime she was seeking was not reported. After a trial began and Fairchild closed her case-in-chief, the trial judge issued judgment for All American.  Fairchild appealed.

The court first addressed the FLSA claims and determined that an employee 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.” It was undisputed at trial Fairchild was paid for the overtime hours she actually reported. Fairchild ignored All American’s policy of not working overtime without prior approval and to report all overtime worked, even if not approved. Fairchild testified that she intentionally failed to report her unauthorized overtime specifically because All American prohibited such overtime. The court was not inclined to allow her to “deliberately evade All American’s policy[.]”And while All American could have discovered the unauthorized overtime by comparing usage records (which Fairchild offered as constructive knowledge of the overtime), mere “access” to this information is insufficient for imputing constructive knowledge.  As a result, the trial court properly issued judgment to All American for the FLSA claims. For a pregnancy-based sex discrimination claim, an employer is liable for disparate treatment, which occurs when the employee’s “protected trait actually motivated” the employer to take the adverse employment action. Fairchild’s only direct evidence of motivation was a single hearsay statement of another employee made during a social lunch but which the trial court did not admit. The other employee was not in the decision making chain and was in a different store. The district court did not abuse its discretion in excluding the evidence. Fairchild’s only circumstantial evidence is the temporal proximity between All American learning that she was pregnant and her termination. However, assuming without deciding that evidence qualified, Fairchild failed to rebut All American’s legitimate non-discriminatory reason for the termination. The court noted the record was “replete” was legitimate bases to terminate Fairchild. The temporal aspect alone is insufficient to establish pretext.  Judgment for All American was proper.

If you would like to read this opinion, click here.   Panel: Judge Prado, Judge Owen, and Judge Haynes.  Opinion given by Judge Edward C. Prado.  Attorney for the Appellant is Daniel Myers Waide.  Attorney for the Appellee is Robin H. Rasmussen.