Preview:

ATTORNEY FOR APPELLANTS Ronald E. Weldy Indianapolis, Indiana ATTORNEYS FOR AMICUS CURIAE ISTA Eric M. Hylton James B. Chapman II Indianapolis, Indiana ATTORNEY FOR AMICUS CURIAE AFSCME COUNCIL 62 William R. Groth Indianapolis, Indiana

ATTORNEYS FOR APPELLEE David L. Swider Susan Oliver Indianapolis, Indiana Robert W. Rund D. Michael Wallman Indianapolis, Indiana ATTORNEY FOR AMICUS CURIAE INDIANA SCHOOL BOARDS ASSOCIATION Julie M. Slavens Indianapolis, Indiana

______________________________________________________________________________

In the

Indiana Supreme Court
_________________________________ No. 49S02-0606-CV-242 TABATHA J. NAUGLE AND SANDRA M. CAIN, ON BEHALF OF THEMSELVES AND OTHERS SIMILARLY SITUATED, Appellants (Plaintiffs below), v. BEECH GROVE CITY SCHOOLS, Appellee (Defendant below). _________________________________ Appeal from the Marion Circuit Court, No. 49C01-0402-PL-490 The Honorable Theodore M. Sosin, Judge _________________________________ On Petition To Transfer from the Indiana Court of Appeals, No. 49A02-0505-CV-472 _________________________________ April 27. 2007 Boehm, Justice. We hold that the term "days" as used in the Wage Payment Statute refers to business days and not calendar days. We also hold that (1) our reasoning in Brownsburg Community School

Corp. v. Natare Corp., 824 N.E.2d 336 (Ind. 2005) does not prevent the application of the Wage Payment Statute to school corporations; (2) there is no school powers statute that precludes application of the Wage Payment Statute to school corporations; (3) there is no generic good faith defense to the Wage Payment Statute; and (4) there is no requirement within the Ten-Day Rule of the Wage Payment Statute that the employee request or demand wages. Facts and Procedural History Beech Grove City Schools ("Beech Grove") is a public school corporation located in Beech Grove, Indiana. Tabatha J. Naugle and Sandra M. Cain were employed by Beech Grove as custodians during 2003. Prior to 2003, Beech Grove paid its employees twenty-six times in each calendar year based on pay periods of two weeks. Payments were made seven calendar days (five business days) after the end of each pay period. Beech Grove adjusted its payroll schedule to resolve two issues in 2003. First, in that year there were twenty-seven pay dates instead of the usual twentysix. This anomaly occurs every seven years. Second, several employees requested that they receive their paychecks on the Wednesdays before the four-day Thanksgiving and Fall Recess breaks, rather than on the Mondays following the breaks. Under the previous payroll schedule, Beech Grove could not satisfy these requests because it would have had insufficient time--only three workdays after the pay period--to prepare and issue the payroll before the breaks. To correct the extra pay period and meet these employee requests, Beech Grove implemented a new payroll schedule beginning on July 11, 2003. The first pay date in July 2003 was moved from July 4 to July 11. The new payroll schedule provided for the employees to receive their wages fourteen calendar days (ten business days) after the end of each pay period instead of the previous seven calendar days (five business days). Under this new payroll schedule, Beech Grove had twenty-six pay dates in 2003 instead of twenty-seven and was able to pay employees on the Wednesdays before the two breaks. The only complaint Beech Grove received about the new schedule was from a single employee who mistakenly thought that he would lose one week of pay. Beech Grove discontinued the new system on July 9, 2004 and reverted to the previous procedure of paying employees seven calendar days (five business days) after the end of each pay period.

2

Naugle voluntarily resigned from her employment at Beech Grove on October 24, 2003, and Cain was terminated on February 6, 2004. On February 18, 2004, Naugle and Cain filed suit against Beech Grove, alleging that Beech Grove had violated the Wage Payment Statute by failing to pay their wages within the time the statute required. 1 Naugle and Cain initiated this claim as a class action and requested actual wages, liquidated damages, and attorney fees as provided under the damages provision of the Wage Payment Statute. The parties, with the approval of the trial court, agreed to defer the issue of class certification until the issue of liability was resolved. The Wage Payment Statute provides that "[p]ayment shall be made for all wages earned to a date not more than ten (10) days prior to the date of payment." Ind. Code

Download Tabatha J. Naugle and Sandra M. Cain v. Beech Grove City Schools.pdf

Indiana Law