Magic Touch Corp. v. Hicks

260 S.W.3d 322, 99 Ark. App. 334, 2007 Ark. App. LEXIS 514
CourtCourt of Appeals of Arkansas
DecidedJune 27, 2007
DocketCA 06-944
StatusPublished
Cited by15 cases

This text of 260 S.W.3d 322 (Magic Touch Corp. v. Hicks) is published on Counsel Stack Legal Research, covering Court of Appeals of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Magic Touch Corp. v. Hicks, 260 S.W.3d 322, 99 Ark. App. 334, 2007 Ark. App. LEXIS 514 (Ark. Ct. App. 2007).

Opinion

Sarah Heffley, Judge.

Appellant Magic Touch Corporation brings this appeal from a $5,000 judgment awarded to appellee Alice Hicks on her complaint for wrongful discharge. Appellant argues on appeal that the trial court erred in concluding that there was no just cause for terminating appellee’s employment. We agree that the trial court erred by not finding that appellee committed acts of insubordination, and we reverse and dismiss.

Appellant corporation owns apartment complexes and operates coin laundry and dry cleaning businesses in the Jonesboro area. Robert Rees is the president of the corporation. Appellee was hired by appellant effective May 13, 2004, at a salary often dollars an hour. Rees and appellee entered into an employment agreement that set out the terms of hire, which included a “guarantee” that appellee would work for appellant for at least thirty-six months. The contract further provided:

It is agreed that Employee will not be fired without just cause as set out in the Employee Handbook. If Employee should be discharged, without such cause, she shall be paid a $5,000.00 fee for such wrongful discharge. If Employee should fail to work for Employer for this 36 month period, she shall pay to the Employee [sic] a $5,000.00 fee for breaking this agreement.

Appellee worked in the main office as a secretary. In that capacity, it was her primary responsibility to manage the apartments. She was to handle telephone inquiries concerning apartment openings, and she filled out applications and leases. Appellee was also required to assign cleaning crews and to make sure that the apartments were ready for occupancy.

Rees fired appellee on July 14, 2004, after two months of employment. Appellee then filed this suit for wrongful discharge, claiming that she had been fired without just cause as set out in the employee handbook. Appellant responded that it had good cause for terminating appellee’s employment, citing multiple infractions of the employee handbook. After a hearing, the trial court found that the employee handbook was ambiguous in certain respects. The court then construed the provisions most strongly against the appellant as the drafter of the agreement and concluded that appellee was fired without just cause. In accordance with the agreement, the trial court awarded appellee $5,000. This appeal followed.

In Arkansas, an employer may fire an employee for good cause, bad cause, or no reason at all under the employment-at-will doctrine. Cisco v. King, 90 Ark. App. 307, 205 S.W.3d 808 (2005). While a contract for an indefinite term is terminable at will, a contract for a definite term may not be terminated before the end of the term, except for cause or by mutual agreement, unless the right to do so is reserved in the contract. See Griffin v. Erickson, 277 Ark. 433, 642 S.W.2d 308 (1982). There are two other exceptions to the at-will doctrine: (1) where an employee relies upon a personnel manual that contains an express agreement against termination except for cause; and (2) where the employment agreement contains a provision that the employee will not be discharged except for cause, even if the agreement has an unspecified term. Ball v. Arkansas Dep’t of Community Punishment, 340 Ark. 424, 10 S.W.3d 873 (2000).

In the case at bar, the employment contract was for a definite term and specifically provided that appellee would not be discharged except for good cause as set out in the employee handbook. The parties are thus in agreement that the contract was not terminable at will. For reversal, appellant argues that it had good and just cause for firing appellee because she violated a number of rules found in the handbook, including excessive absenteeism, requests for unauthorized vacation leave and holiday pay, the violation of a standards-of-conduct provision, the violation of a confidentiality-of-pay provision, the violation of the availability-for-work provision, and insubordination.

The standard of review of a circuit court’s findings of fact after a bench trial is whether those findings are clearly erroneous. First Nat’l Bank v. Garner, 86 Ark. App. 213, 167 S.W.3d 664 (2004). A finding is clearly erroneous when, although there is evidence to support it, the reviewing court on the entire evidence is left with a definite and firm conviction that a mistake has been made. Id.

At the hearing, it was disclosed that appellee’s personnel file documented ten excused absences in her two months of employment. The employee handbook contained a provision that stated “[i]fyou are absent 4 times, either excused or unexcused, in a 3 month period you will be terminated.” By contrast, the absence reports filled out by appellee and a manager contain the statement “over three unexcused absences can result in your termination.”

The handbook also directed employees not to discuss their salaries with one another and stated that “[i]fwe find that someone else knows what you make we will either terminate you or reduce your pay.” Appellee admitted she had violated this provision by discussing her earnings with another employee. That employee, however, was the payroll clerk, who by virtue of her position, already had knowledge of appellee’s salary.

The record also discloses that appellee requested a week of vacation during the month of July, and appellee testified as to her belief that she should have been paid for the Memorial Day and Fourth ofjuly holidays. Mr. Rees advised appellee that she was not yet eligible for vacation leave or paid holidays. He also testified that he overheard appellee telling another employee that she was going to take a week of vacation whether Rees approved it or not. On these subjects, the handbook provided that an employee would receive five working days of vacation at half pay after working for the company for fifteen months. Requests for vacation leave were required to be made forty-five days in advance. Full-time employees were also eligible for paid holidays, such as Memorial Day and the Fourth ofjuly, if the employee had worked for the company for six months and had not been late or absent during the thirty days preceding the holiday.

The employee handbook contained another provision stating that “[e]mployees must be available for work during normal business hours.” It further stated that “[a]t times you may be needed to fill in for another employee that is not at work during their work schedule. You will be expected to be available to do this when needed. This is something that you may not want to do today but tomorrow when you need someone to work for you, you will be glad you did.”

In her testimony, appellee maintained the position that her work schedule was confined to week days from 8:00 a.m. to 5:00 p.m. She acknowledged that she had been called upon outside of that time frame. Appellee testified that she received numerous phone calls at home on the weekends. She had once delivered coins to one of appellant’s laundromats. She also showed an apartment to a friend’s son one weekday after work.

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Cite This Page — Counsel Stack

Bluebook (online)
260 S.W.3d 322, 99 Ark. App. 334, 2007 Ark. App. LEXIS 514, Counsel Stack Legal Research, https://law.counselstack.com/opinion/magic-touch-corp-v-hicks-arkctapp-2007.