Becerra Becerra v. Expert Janitorial, LLCBecerra Becerra v. Expert Janitorial, LLC
Facts
¶2 The plaintiffs in this case, Carolina Becerra Becerra, Julio Cesar Martinez Martinez, Orlando Ventura Reyes, Alma A. Becerra, and Adelene Mendozo Solorio, all did janitorial work in Puget Sound Fred Meyer stores mostly while the stores were closed and locked at night. None of the plaintiffs were formally employed by either Fred Meyer or Expert. Until 2004, Fred Meyer had employed its own, mostly unionized janitors in its Pacific Northwest grocery stores. In 2004, Fred Meyer began to outsource much of this work.
¶3 In 2007, Expert acquired the management contract to provide Fred Meyer with outsourced facility maintenance services. At the time, Expert had no janitorial employees itself but would instead “typically subcontract with independent janitorial companies, called ‘Service Providers,’ who provide, manage, and supervise the workers who clean the customers’ stores.” Clerk’s Papers (CP) at
¶4 Between 2007 and 2010, Expert subcontracted with at least nine different second-tier subcontracting service providers, including All Janitorial LLC and All American Janitorial LLC,
¶5 All Janitorial was owned and principally managed by Sergey Chaban.
¶6 Chaban acknowledged that the janitors began work no later than 11:00 p.m. each night and would often not be signed out by Fred Meyer employees, and thus not able to leave work, until after 8:00 a.m. the next morning. Id. at 1927. Thus, they regularly worked more than eight hours per night. According to plaintiffs’ expert John Ezzo, it is common for such second-tier subcontractors to take the risk of misclassifying their employees and not meeting their legal obligations under minimum wage statutes “because they have relatively little to lose; they go out of business when their practices come to light.” Id. at 1060.
¶7 The plaintiffs brought suit against the second-tier contractors, Fred Meyer Stores and Expert, for violation of the MWA, among other things. The plaintiffs contended that they were misclassified as independent contractors; that as a matter of economic reality, they were Expert’s and Fred Meyer’s employees; and that both companies knew the plaintiffs were misclassified and
¶8 Fred Meyer and Expert moved for partial summary judgment, arguing that they were not, as a matter of law, the plaintiffs’ employers. The trial judge heard oral argument on both motions separately, starting with Expert’s motion in May 2011 and Fred Meyer’s motion in September of that year. In a later written order that has not been challenged, the trial court found that the plaintiffs “were scheduled 7 nights a week, with the exception of Christmas Eve. The shift began no later than 11:00 p.m. and was supposed to end at 7:00 a.m., but regularly ran over.” CP at 1927. At least in part, plaintiffs’ shifts regularly ran over because they were not to leave until “Fred Meyer supervision signed off on their daily Work Order sheet.” Id. The trial court also found that the plaintiffs were allowed to take a night off only if they could find their own replacement.
¶9 In the matter before us, the judge entered a brief written order dismissing the plaintiffs’ joint employment claim against Expert “under the test set forth in Bonnette v. California Health & Welfare Agency,
flO Fred Meyer and Expert each petitioned for review. The Association of Washington Business, the National Federation of Independent Business, the National Federation of Independent Business Small Business Legal Center, the Washington Retail Association, and the International Franchise Association filed an amicus brief in support of the petition. We granted review. Becerra Becerra v. Expert Janitorial,
Analysis
¶11 “Summary judgment entitles one party to judgment as a matter of law and is reviewed de novo.” Rivas v. Overlake Hosp. Med. Ctr,
fl2 Our State’s “MWA requires employers to pay their employees (as the act defines ‘employees’) overtime pay for the hours they work over 40 hours per week,” subject to exceptions not raised here. Bostain v. Food Express, Inc.,
¶13 The MWA is remedial in nature and is liberally construed. Id. at 870 (citing Int’l Ass’n of Fire Fighters, Local 46 v. City of Everett,
if the facts establish that the employee is employed jointly by two or more employers, i.e., that employment by one employer is not completely disassociated from employment by the other employer(s), all of the employee’s work for all of the joint employers during the workweek is considered as one employment for purposes of the Act. In this event, all joint employers are responsible, both individually and jointly, for compliance with all of the applicable provisions of the act, including the overtime provisions, with respect to the entire employment for the particular workweek.
29 C.F.R. § 791.2; see also Torres-Lopez v. May,
¶[14 While we have never specifically held that the “joint employer” doctrine is a viable theory under the MWA, Expert and Fred Meyer do not dispute that if they are found to be the joint employers of the plaintiffs, they are each responsible for compliance with the MWA. This accords with federal FLSA jurisprudence. See 29 C.F.R. § 791.2; see also Torres-Lopez,
¶15 The parties agree that we use an “economic reality” test to determine whether a joint employment relationship exists under minimum wage statutes.
“(A) The nature and degree of control of the workers;
“(B) The degree of supervision, direct or indirect, of the work;
“(C) The power to determine the pay rates or the methods of payment of the workers;
“(D) The right, directly or indirectly, to hire, fire, or modify the employment conditions of the workers; [and]
“(E) Preparation of payroll and the payment of wages.”
Id. at 639-40 (alteration in original) (quoting 29 C.F.R. § 500.20(h)(4)(ii)). The court also articulated 8 common law (sometimes called “functional”) factors:
(1) whether the work was a “specialty job on the production line,” Rutherford [Food Corp. v. McComb], 331 U.S. [722,] 730, 67 S. Ct. [1473,91 L. Ed. 1772 (1947)];
(2) whether responsibility under the contracts between a labor contractor and an employer pass from one labor contractor to another without “material changes,” id.;
(3) whether the “premises and equipment” of the employer are used for the work, id.; see also Real,603 F.2d at 754 (considering the alleged employee’s “investment in equipment or materials required for his task, or his employment of helpers”);
(4) whether the employees had a “business organization that could or did shift as a unit from one [worksite] to another,” Rutherford,331 U.S. at 730 . . . ;
(5) whether the work was “piecework” and not work that required “initiative, judgment or foresight,” id.; see also Real,603 F.2d at 754 (considering “whether the service rendered requires a special skill”);
(6) whether the employee had an “opportunity for profit or loss depending upon [the alleged employee’s] managerial skill,” Real,603 F.2d at 754 ;
(7) whether there was “permanence [in] the working relationship,” id.; and
(8) whether “the service rendered is an integral part of the alleged employer’s business,” id.
Id. at 640 (some alterations in original); see also Moreau v. Air France,
¶16 These factors are not exclusive and are not to be applied mechanically or in a particular order. As the United States Supreme Court noted long ago, “[T]he determination of the relationship does not depend on such isolated factors but rather upon the circumstances of the whole activity.” Rutherford,
1. Expert
¶17 The trial judge articulated only the four Bonnette factors in dismissing the
There is no genuine issue of material fact on the issue of whether Expert was Plaintiffs’ joint employer, and the Defendant is entitled to judgment as a matter of law. Specifically, the Court concludes that Expert was not Plaintiffs’ joint employer under the test set forth in Bonnette v. California Health and Welfare Agency,704 F.2d 1465 , 1469 (9th Cir. 1983). Expert was not involved in hiring or firing the plaintiffs, did not supervise their work schedules or conditions of employment, was not involved in determining the plaintiffs’ rate of pay and did not maintain their employment records. Plaintiffs admit that nobody from Expert ever told them what to do or how to do their jobs. In fact, the plaintiffs could not even identify any employees who worked for Expert.
CP at 1961. Later, in the context of ruling on Fred Meyer’s summary judgment motion, the judge noted that she had limited her analysis in Expert’s motion to the Bonnette factors on the theory that the nonregulatory factors “seem to apply more to the Boeing[
¶18 Simply put, we find the trial court did not consider all the relevant factors at summary judgment or sufficiently identify why it deemed certain factors to be not relevant. While our review of the record suggests that summary judgment was improperly granted on the merits, we do not mean to bind the trial court’s hands on remand. We remand for further proceedings, including further discovery by the parties if they deem it necessary, and direct the trial court to consider any otherwise proper summary judgment motions brought by the parties raising the joint employment matter again.
2. Fred Meyer
¶19 The trial judge’s written ruling granting Fred Meyer’s summary judgment did not identify any of the factors she considered. In her oral ruling, she effectively found that four factors, some formal and some functional, weighed in favor of finding Fred Meyer was not the joint employer of the janitors. Again, we believe it is unlikely summary judgment should have been granted on this record, but we leave it in the able hands of the trial court to reconsider the matter using the Torres-Lopez factors on remand.
Conclusion
¶20 We affirm the Court of Appeals and remand for further proceedings on whether Fred Meyer and Expert functioned as joint employers of the janitors under Washington’s MWA.
Madsen, C.J., and C. Johnson, Owens, Fairhurst, Stephens, Wiggins, Gordon McCloud, and Yu, JJ., concur.
Notes
At oral argument, counsel for Expert said that Expert does have its own janitorial employees but did not assign error to the trial court order finding otherwise.
The record suggests that in 2010, All American formally reclassified the janitors as employees.
Proceedings against Chaban have been stayed by bankruptcy proceedings.
According to Ezzo, many businesses use second-tier contractors who recruit janitors, classify them as independent contractors, schedule them to work full shifts seven days a week, and do not comply with minimum wage laws. He testified that this is sometimes referred to as the “Building One” model, based on the company that pioneered it in the late 1990s. E.g., CP at 1063, 1073; Resp’ts’ Suppl. Br. at 3. Building One went out of business “while it was being sued in a class action by janitors who claimed they were being misclassified and working long hours of overtime.” CP at 1074. Ezzo testified that second-tier subcontractors can save “20% right away by classifying its janitors as independent contractors. It does so by not having to pay payroll taxes (Social Security, Medicare, FUTA [Federal Unemployment Tax Act, Internal Revenue Code ch. 23], Unemployment Insurance and other taxes), industrial insurance and by not paying overtime and/or minimum wages.” Id. at 1076. Ezzo, himself a chief executive officer of a janitorial company, contended that these violations would not occur without the first-tier contractors “turning away from these problems.” Id. at 1081. He submitted evidence that several suits for violation of minimum wage laws had been filed by advocates for janitors, including the United States Labor Department and Justice Department, and settled for millions of dollars. The petitioners challenged the admissibility of much of Ezzo’s declarations and renew their objections in their supplemental briefs, but they did not assign error to the trial court’s decision not to exclude it or designate it as an issue for review. We decline to consider whether the declarations were properly before the trial court without prejudice to a new proper objection before the trial court on remand.
Bonnette was abrogated on other grounds by Garcia v. San Antonio Metropolitan Transit Authority,
We note that we are not asked to review the subcontractor’s characterization of the plaintiffs as independent contractors. Whether an employee is in fact an independent contractor is determined under a separate analysis. See generally Anfinson,
It is not clear what case the trial judge is referring to or if the court reporter misheard her. No case named Boeing was cited in the summary judgment briefing, raised on oral argument on the motion, or appears in FLSA joint employment case law. We note that Expert urges us to find that the trial court did consider more factors than those she listed, but our review of the record persuades us otherwise.