90 Cal.App.5th 548
Cal. Ct. App.2023Background
- Plaintiff Kelly Gola and a class of >600 adjunct (part‑time) faculty taught semester‑by‑semester at University of San Francisco; appointment letters identified semester start/end, per‑course salary, and linked to the collective bargaining agreement (CBA).
- Adjuncts were required by the CBA and handbook to perform pre‑semester preparation and post‑semester grading, but paystubs did not report hours worked or an effective hourly rate; adjuncts were not asked to track hours.
- Gola sued asserting (1) unpaid wages for work outside the appointment period (Labor Code §§1194, 201–203), (2) wage‑statement violations for omission of total hours and effective hourly rate (Lab. Code §226), and (3) waiting‑time penalties; she also asserted PAGA claims.
- Trial court: dismissed unpaid‑wage and waiting‑time claims as preempted by the LMRA §301 (CBA interpretation required); held University liable on the §226 wage‑statement claim as a "knowing and intentional" violation and awarded statutory damages, PAGA penalties, and attorneys’ fees.
- On appeal University argued (a) post‑judgment statute §515.7 (creating an exemption for certain adjuncts) should apply retroactively or via abatement to defeat §226 liability, and (b) the §226 penalty finding was erroneous; Gola cross‑appealed preemption rulings.
- Court of Appeal: affirmed — rejected retroactive application and abatement, affirmed §226 liability and penalties, and affirmed LMRA preemption of unpaid‑wage and waiting‑time claims; fee award upheld.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Labor Code §515.7 (enacted 9/9/2020) applies retroactively to bar §226 claims for pre‑enactment wage statements | §515.7 should not apply retroactively; presumption against retroactivity | §515.7 clarifies law/was an urgency measure and should extinguish liability for earlier wage statements | §515.7 is prospective only; silence and statutory text indicate no retroactivity; urgency/legislative history insufficient; abatement inapplicable |
| Whether University violated §226 by omitting total hours and effective hourly rate | Gola: wage statements violated §226; employees entitled to statutory penalties | Univ: statements sufficient or any omission was not "knowing and intentional"; reporting hours would be misleading because pay is per course | Court upheld finding that wage statements omitted required items and that University’s failure was knowing and intentional; statutory damages and PAGA penalties stand |
| Proper scienter test for §226 penalties ("knowing and intentional") | Implicitly: predicate‑facts approach — if employer knew facts triggering duty, liability follows | Univ: adopt a good‑faith belief test to avoid penalties when employer had reasonable/legal belief of compliance | Court applied/endorsed predicate‑facts test (excluding only isolated clerical errors); rejected adopting good‑faith test here (and noted Univ. did not preserve a good‑faith defense factually) |
| Whether LMRA §301 preempts Gola’s unpaid‑wage and waiting‑time claims | Gola: claims are state law and can be resolved without interpreting the CBA | Univ: claims require interpreting CBA terms (appointment period, total compensation), so federal preemption applies | Court held claims preempted because resolving them would require choosing among competing interpretations of the CBA; dismissal affirmed |
Key Cases Cited
- Aetna Casualty & Surety Co. v. Industrial Accident Commission, 30 Cal.2d 388 (1947) (defines retrospective law and presumption against retroactivity)
- Evangelatos v. Superior Court, 44 Cal.3d 1188 (1988) (statutory nonretroactivity canon; Legislature must clearly intend retroactivity)
- McClung v. Employment Development Dept., 34 Cal.4th 467 (2004) (retroactivity requires express language or unavoidable implication)
- Western Security Bank v. Superior Court, 15 Cal.4th 232 (1997) (factors relevant to retroactive application examined in context)
- People v. One 1953 Buick 2‑Door, 57 Cal.2d 358 (1962) (repeal of statutory penalties before final judgment extinguishes the right)
- Krause v. Rarity, 210 Cal. 644 (1930) (abatement inapplicable where statute narrows but does not repeal remedy entirely)
- Zipperer v. County of Santa Clara, 133 Cal.App.4th 1013 (2005) (articulates factors/tests for abatement of pending statutory claims)
- Rankin v. Longs Drug Stores California, Inc., 169 Cal.App.4th 1246 (2009) (abatement where later law partially repealed or insulated defendant from prior state statutory liability)
- Allis‑Chalmers Corp. v. Lueck, 471 U.S. 202 (1985) (LMRA §301 preempts state claims that require interpretation of CBA)
- Livadas v. Bradshaw, 512 U.S. 107 (1994) (consulting a CBA not dispositive; preemption depends on whether resolving claim requires interpreting the CBA)
- Melendez v. San Francisco Baseball Associates LLC, 7 Cal.5th 1 (2019) (summarizes LMRA preemption standard applied in California)
- Furry v. East Bay Publishing, LLC, 30 Cal.App.5th 1072 (2018) (predicate‑facts approach to §226 knowing/intentional liability)
- Kao v. Holiday, 12 Cal.App.5th 947 (2017) (adopts predicate‑facts test for §226 scienter)
- Naranjo v. Spectrum Security Services, Inc., 88 Cal.App.5th 937 (2023) (adopts a good‑faith test for §226 scienter in another division)