Tyson Foods Owes $4M for Unpaid Equipment Time
DENVER (CN) - Tyson Foods cannot wriggle out of a $4 million verdict and attorneys' fee award for underpaying employees for time spent donning and doffing protective clothes before and after their shifts, the 10th Circuit ruled.
Lead plaintiff Adelina Garcia and several hundred other employees from a Tyson facility in Finney, County, Kansas, filed a proposed class action in Kansas federal court in 2006. They alleged violations of the Fair Labor Standards Act and Kansas Wage Protection Act for being underpaid for the putting on and taking off of shin guards, mesh aprons, belly guards, plexiglass arm guards and knocker vests, among other things.
The jury awarded approximately $500,000 in actual damages and the trial court later awarded over $3.3 million in attorneys' fees under the FLSA.
The trial court also denied Tyson's motion for judgment as a matter of law. The company then appealed the ruling and argued the fee award was excessive. Tyson said there was not enough evidence to support the verdict because the employees did not prove unpaid time on a class-wide basis.
A three-judge panel with the 10th Circuit affirmed on Tuesday, concluding "a jury could have reasonably inferred class-wide liability based on the trial evidence."
"We reject Tyson's contentions," wrote U.S. Circuit Judge Robert E. Bacharach. "The plaintiffs presented sufficient evidence of undercompensation and the district court acted within its discretion in setting the fee award."
Tyson acknowledged its separate, K-Code category of pay was intended to compensate workers for donning and doffing activities, the 27-page opinion stated.
"Thus, the jury could have inferred recognition by Tyson that until 2010, it had underestimated the time required to get in and out of the protective clothing and equipment and to walk to and from the work stations," Bacharach wrote. "We do not know how the jury ultimately decided to find class-wide liability. But we do know that there was a reasonable basis for the jury's finding of systematic undercompensation. Thus, the evidence was sufficient for the finding of class-wide liability."
The appeals court also disagreed with Tyson's argument that the jury must have assessed liability for class members who were not underpaid because the jury awarded less than what the plaintiffs asked for.
"We disagree because: (1) the evidence supported a finding of undercompensation for every class member, and (2) Tyson's argument rests on speculation about how the jury calculated damages," the opinion stated.
The appeals court concluded the trial court did not abuse its discretion in allowing recovery of attorneys' fees for time spent on the state claims and unsuccessful federal claims.
"Though the claims had some factual and legal differences, the court could reasonably conclude that the similarities justified an award for the time spent in meals and breaks," Bacharach wrote. "The court could reasonably conclude that a relation existed between: (1) the federal claims for pre- and post-shift activities, and (2) the state claims and the federal claims for underpayment involving meals and breaks."
Tyson spokesman Gary Mickelson said the company will explore its legal options.
"We're disappointed by the ruling and disagree with it, especially since most of the award is for attorneys' fees, not for the plant workers," Mickelson said Thursday.