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Shoals Extrusion, LLC v. Beal

Supreme Court of Alabama

April 19, 2019

SHOALS EXTRUSION, LLC
v.
Lonnie BEAL.

         Appeal from Lauderdale Circuit Court (CV-15-900394).

          Nickolas J. Steles , Tuscumbia, for appellant.

          Regina F. Cash and Julie M. Hudson of Luther, Collier, Hodges & Cash LLP, Mobile, for appellee.

         MITCHELL, Justice.

         Lonnie Beal sued his former employer, Shoals Extrusion, LLC, an aluminum-extrusion business in Florence, after his employment there was terminated in November 2015. Beal alleged that Shoals Extrusion breached the terms of his employment

Page 449

agreement by refusing to give him severance compensation and benefits to which he claims he was entitled. The Lauderdale Circuit Court entered a summary judgment in favor of Beal and awarded him $80,800. This appeal followed. We reverse the summary judgment and remand the cause for further proceedings.

         Facts and Procedural History

         In late 2014, Beal was working at an extrusion business in Florence when his supervisor, Wilbur Craven, asked him if he would be interested in becoming the plant manager for Shoals Extrusion, a new business Craven and other individuals were starting.[1] Beal responded in the affirmative, and, in early 2015, he began formal discussions with Craven and Wade Gilchrist, another owner of Shoals Extrusion, about the new business and what the terms of his employment would be. After an agreement was reached in principle, Beal requested that Shoals Extrusion prepare a written employment agreement memorializing the agreed-upon terms.

         On March 27, 2015, Beal and Craven executed a five-year employment agreement that obligated Shoals Extrusion to pay Beal a $20,000 signing bonus and a first-year salary of $70,000. Shoals Extrusion also agreed to pay Beal's health-insurance premiums. In return, Beal agreed that "[t]he work week shall be [a] 40 plus hour work week and the days and the time shall be as set by [Shoals Extrusion]." The agreement further provided that, if Shoals Extrusion terminated Beal's employment during the five-year term of the agreement, it would pay Beal his "wages and benefits for the term of [one] year." For his part, Beal agreed that, if he chose to leave Shoals Extrusion before the five-year term of the agreement expired, he would pay back the $20,000 signing bonus within 30 days of leaving the employ.

         On April 1, 2015, Beal began working for Shoals Extrusion. In July 2015, Shoals Extrusion opened its facility and started production with one shift beginning at 7:00 a.m. and continuing for approximately 8 to 10 hours, depending on the volume of orders. In August 2015, Shoals Extrusion began operating a second shift. According to Craven, the employees voted to move the start time of the first shift up to 6:00 a.m. so the second shift did not have to work as late. Beal, however, refused to change his schedule and continued to arrive at the facility at 7:00 a.m. or later.

         Craven and Gilchrist spoke with Beal on multiple occasions about Beal working additional hours to increase production at the facility. Craven and Gilchrist stated, however, that Beal repeatedly indicated that he was not willing to work more hours than he was working unless he received an ownership interest in Shoals Extrusion. They stated that Beal further told them that he would, in fact, reduce the hours he was working unless he received the ownership interest he was seeking. Craven stated that he eventually learned that Beal was also telling certain individuals in the industry that Shoals Extrusion was having financial problems. Shoals Extrusion subsequently decided to terminate Beal's employment.

         On November 23, 2015, Craven and Gilchrist met with Beal and terminated his

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employment with Shoals Extrusion. During the meeting, they asked Beal to execute a "severance and general release agreement" that would, by its terms, obligate Shoals Extrusion to pay Beal's salary through December 31, 2015, in return for Beal's releasing any claims he might have against Shoals Extrusion. Beal declined to sign the proposed severance agreement. Shoals Extrusion thereafter made no further payments to Beal, despite his demand that it owed him ...


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