KELLY GOLA v. UNIVERSITY OF SAN FRANCISCO
A161477, A162437
In the Court of Appeal of the State of California, First Appellate District, Division Two
Filed 4/13/23
CERTIFIED FOR PUBLICATION; San Francisco County Super. Ct. No. CGC-18-565018
The University appeals the trial court‘s judgment, after a bench trial, awarding Gola penalties and attorneys’ fees in connection with the University‘s failure to issue wage statements compliant with
Gola cross-appeals the trial court‘s dismissal of her claims for unpaid wages and waiting-time penalties as preempted by federal law. The federal
BACKGROUND
During the period relevant here, the University‘s practice with respect to adjunct faculty was to hire them to teach individual classes on a semester-by-semester basis. For each semester, the University would issue appointment letters offering employment to prospective adjunct professors during a specified assignment period that ran from the first day of that semester‘s classes to the end of the semester. The appointment letters stated that the employment
Although the appointment letters specified the first day of classes each semester as the beginning of the adjunct‘s work appointment and the end of the semester as the end of the appointment, adjunct professors were required to work outside of these time periods: they were expected to prepare a syllabus and final examination for the class before the start date of classes, and they were obliged to submit students’ final grades after classes and final exams concluded. These obligations were set out in the CBA and in a “Part-Time Faculty Policy Handbook.”
The appointment letters specified that adjuncts’ salary would be paid in installments, typically four per semester, in accordance with the University‘s payroll schedule. Adjuncts received paystubs or wage statements with their pay. The wage statements reflected the amount of pay they received but did not show the number of hours they worked or an hourly rate of pay. Adjuncts were not asked to track the number of hours they worked. This had been the practice at the University for decades before Gola‘s lawsuit.
Adjunct faculty at the University, of whom there are more than 600, are represented by a labor organization: the “USF Part Time Faculty Association” (Association). The Association and the University have entered into a series of CBAs over the years governing the terms of adjunct faculty employment. For the time period covered by Gola‘s lawsuit, two CBAs were in effect: one that took effect July 1, 2015, and another that is dated July 1, 2018, and was finally executed on August 2, 2019. Both of those CBAs set out a salary schedule for adjunct faculty; both require adjuncts to submit syllabi before classes begin and to submit final grades “in a reasonable and timely manner“; and both state that the parties agree that the “terms of this Agreement (including pay for Association members) compl[y] with all federal, state and local wage laws.” The July 1, 2018 CBA added that the parties agreed “the classification of bargaining unit faculty are as professional employees.”
Gola filed a lawsuit against the University on March 15, 2018 and filed the operative complaint on July 19, 2018. As a first cause of action, the operative complaint alleged a claim for unpaid wages on behalf of Gola and a class of similarly situated adjuncts pursuant to
As a second cause of action, the operative complaint alleged that the University failed to issue wage statements in compliance with
Gola‘s operative complaint asserted two additional claims: as a fourth cause of action, she alleged violations of the Unfair Competition Law. (
As an affirmative defense, the University asserted that Gola‘s claims were preempted by the LMRA, which preempts all state-law claims that require interpretation of a CBA. This affirmative defense was bifurcated and tried to the court. Following the bench trial, the trial court issued a statement of decision holding that Gola‘s first and third causes of action were indeed preempted because these claims could not be resolved without interpreting the CBA.
With respect to Gola‘s second cause of action, the wage statement claim, the trial court determined this claim was not preempted by federal law. The wage statement claim proceeded to a bench trial on the merits, after which the trial court issued a second statement of decision. The factual findings in this statement of decision are not disputed on appeal. In brief, the trial court found that the wage statements the University issued to adjunct faculty did not include the “total hours worked by the employee” or the employee‘s effective hourly rate. The court concluded that adjunct faculty were not exempt employees; in fact, the University made no argument at trial to the contrary. Instead, the University argued that it could not be liable for
Having found the University liable for
DISCUSSION
I. Wage Statement Claim
A. General Principles
” ‘In reviewing a judgment based upon a statement of decision following a bench trial, we review questions of law de novo. [Citation.] We apply a substantial evidence standard of review to the trial court‘s findings of fact. [Citation.] Under this deferential standard of review, findings of fact are liberally construed to support the judgment and we consider the evidence in the light most favorable to the prevailing party, drawing all reasonable inferences in support of the findings.’ (Thompson v. Asimos (2016) 6 Cal.App.5th 970, 981.)” (Furry v. East Bay Publishing, LLC (2018) 30 Cal.App.5th 1072, 1078 (Furry).)
As relevant here,
At the time of trial, and at the time the University issued the challenged wage statements to Gola and the subclass, there was no Labor Code provision or order of the IWC providing that adjunct faculty were exempt from payment of overtime. Accordingly, pursuant to
On appeal, the University does not contend that Gola and the
Gola contends that this argument is not properly before us: the University, she contends, forfeited at trial any argument that adjunct faculty are exempt and accordingly cannot now make the argument. Because
We turn now to the University‘s argument. To evaluate it, we must address the effect of
1.
” ‘A retrospective law is one which affects rights, obligations, acts, transactions and conditions which are performed or exist prior to the adoption of the statute.’ ” (Aetna Casualty & Surety Co. v. Industrial Accident Commission (1947) 30 Cal.2d 388, 391.) Whether a statute operates retroactively “is, in the first instance, a policy question for the legislative body” and if it has spoken clearly then no further interpretation is required. (Evangelatos v. Superior Court (1988) 44 Cal.3d 1188, 1206.) But if judicial construction is required, we begin with the ” ‘established canon of interpretation that statutes are not to be given a retrospective operation unless it is clearly made to appear that such was the legislative intent.’ ” (Id. at p. 1207, quoting Aetna, at p. 393; see also McClung v. Employment Development Dept. (2004) 34 Cal.4th 467, 475 [” ‘[A] statute may be applied retroactively only if it contains express language of retroactivity or if other sources provide a clear and unavoidable implication that the Legislature intended retroactive application’ “]; Western Security Bank v. Superior Court (1997) 15 Cal.4th 232, 243 [“A basic canon of statutory interpretation is that statutes do not operate retrosрectively unless the Legislature plainly intended them to do so“].) The Labor Code in particular contains a general statutory provision that counsels against retroactive application of its sections. (
The University does not claim that the statute contains an express retroactivity provision, and it acknowledges the presumption against retroactivity. But the University argues that the legislative history and remedial purposes of
We first review the legislative history.
The University claims that
The University also urges us to find
2.
The University advances a second argument for the retroactive application of
Applying that test for repeal, we reject the University‘s argument that the abatement doctrine applies to this case. With
Our conclusion is consistent with Krause v. Rarity (1930) 210 Cal. 644, and with Thurman v. Bayshore Transit Management, Inc. (2012) 203 Cal.App.4th 1112, overruled on other grounds in Z.B., N.A. v. Superior Court (2019) 8 Cal.5th 175. In Krause, our high court considered a law that repealed an existing statutory cause of action for wrongful death of a guest in a vehicle arising from negligence and replaced it with a new statute providing for recovery only in cases of intoxication, willful misconduct, or gross negligence of the driver. (Krause, at pp. 651-652.) The California Supreme Court rejected the abatement theory because the statute under which the claim was brought was not “repealed entirely” and guest liability was not abolished but merely narrowed. (Id. at p. 655.) Because the abatement theory was inapposite, the ordinary rule of statutory construction—that statutes operate prospectively unless their retrospective effect is clearly apparent—continued to apply. Similarly, in Thurman, a PAGA case, the Fourth District Court of Appeal considered a new statute that required PAGA plaintiffs to exhaust administrative remedies before bringing suit. (Thurman, at p. 1152.) Rejecting the argument that thе new exhaustion statute abated existing unexhausted cases by removing their statutory basis, Thurman concluded that the exhaustion statute “did not constitute a substantial reversal of the legislative policy underlying the PAGA” but rather a modification intended to refine and improve it. (Ibid.) Here, a statutory cause of action for adjunct faculty to challenge the omission of information from their wage statements remains, albeit in narrower form, as in the statutes at issue in Krause and Thurman.
C. No Error in “Knowing and Intentional” Finding
An employer‘s violation of the wage statement provisions must be “knowing and intentional” for an employee to recover penalties. (
The trial court found that “the evidence is not that the [U]niversity had a good faith belief [that adjunct instructors were exempt under state law]; the evidence is that they never thought about it.” This factual finding is entitled to deference on review (Furry, supra, 30 Cal.App.5th at p. 1078), and the University does not challenge it as unsupported by substantial evidence. Instead, the University argues that the trial court made a mistake of law in applying the “predicate facts” test, an interpretation of
We conclude that the trial court applied the correct legal test.
Moreover, we are not persuaded by the cases adopting a different test that the University urges us to follow. Some have adopted the “good-faith” test because they have equated
(N.D.Cal. 2019) 384 F.Supp.3d 1058, 1084, revd. in part, vacated in part on other grounds (9th Cir. 2021) 999 F.3d 668.) But the words used by the
We acknowledge that with Naranjo, a sister Court of Appeal has now adopted the good-faith test. (Naranjo, supra, 88 Cal.App. 5th at p. 951 [“a good faith dispute over whether an employer is in compliance with section 226 precludes a finding of a knowing and intentional violation“].) We note, however, that even under the test as set out in Naranjo, the University would not prevail on this argument. Naranjo holds that the question of whether an employer acted in good faith is a fact question that is subject to substantial evidence review on appeal. (Ibid. [“substantial evidence supports the trial court‘s finding that Spectrum presented defenses in the first phase of trial in good faith“].) Here, the trial court found that the University did not present evidence at trial of a good-faith dispute over the applicability of
D. Purpose of Section 226
As a final argument for revеrsal, the University argues that it cannot be liable here because
Even if we were persuaded by the University‘s purpose arguments, we are not free to disregard the statute‘s text. “‘[U]nder the guise of construction, a court should not rewrite the law . . . [or] omit from it what has been inserted[.]‘” (Soto v. Motel 6 Operating, L.P. (2016) 4 Cal.App.5th 385, 393.) The Legislature is well aware that wage statements for non-exempt employees who are not paid by the hour must nonetheless show an effective hourly rate; it expressly аdded that requirement to
II. Federal Preemption of Failure to Pay and Waiting Time Claims
Gola‘s first cause of action for failure to pay wages, and her third cause of action for failure to pay wages upon dismissal, depend on the same factual premise: according to Gola, the assignment letters she and all adjuncts received set out the start and end dates of their employment for each semester, as well as their salary for work within that period, and only within that period. But, Gola contends, adjuncts were required to work before and after the assignment period, and the salary named in the assignment letters did not cover that work. The trial court determined that these causes of action could only be resolved by construing the CBA, including whether its salary schedule included compensation for before- and after-semester work. Accordingly, the trial court determined that Gola‘s first and third causes of action were preempted by federal law, and Gola cross-appeals those determinations. Our review is de novo. (See Farm Raised Salmon Cases (2008) 42 Cal.4th 1077, 1089, fn. 10.)
“Section 301(a) of the Labor Management Relations Act, 1947 (
The “‘touchstone’ for [LMRA] section 301 preemption analysis is the nature of the plaintiff‘s underlying claim.” (Levy v. Skywalker Sound (2003) 108 Cal.App.4th 753, 763.) Reviewing Gola‘s claim, as alleged in the operative complaint, we conclude that resolution of the factual dispute that underlies the first and third causes of action—whether adjuncts’ salary covered only the teaching semester, or whether it covered work before and after the semester as well—cannot be resolved without interpreting the CBA.
Gola‘s operative complaint contends that adjuncts’ work dates were the semester start and end dates set out in their assignment letters. In her trial brief on the LMRA section 301 preemption issue, Gola attached the assignment letters containing the dates. Each of the assignment letters includes a link to the CBA and states that “[t]he terms of the appointment are consistent with the terms of the [CBA].” To resolve the issue of whether Gola was unpaid for work she performed before and after the semester, a factfinder would have to resolve whether the assignment letters incorporated the CBA, and what effect the CBA had on the terms of Gola‘s employment. Other questions about the interpretation of the CBA would also arise. For instance, article 11.2 of the CBA provides that written notification of an appointment—which, a factfinder could find, refers to the appointment letters that Gola relies on—“shall include the beginning and ending dates of appointment” as well as the salary. This provision supports Gola‘s interpretation of the period of her employment, yet the CBA also sets out the before- and after-semester
Gola offers two primary arguments against this conclusion. She contends first that federal preemption does not lie where a CBA interpretation issue is raised exclusively by a defendant and not by a plaintiff in stating her claim. Gola relies on Caterpillar Inc. v. Williams (1987) 482 U.S. 386 for this argument, but the CBA interpretation issue in that case was integral to the affirmative defense of waiver. Here, by contrast, an interpretation of the CBA is required not to resolve an affirmative defense, but the very claims Gola has pled. (See Deschene v. Pinole Point Steel Co. (1999) 76 Cal.App.4th 33, 40–41 [“To determine whether a state claim will be preempted by section 301 of the LMRA because it would require interpretation of the CBA we look to the elements of the claim, the terms of the agreement, the facts which plaintiff believes support the cause of action and those the defendant may assert in his defense“].) Nothing in Caterpillar requires us to consider only plaintiff‘s contentions, or to accept without question plaintiff‘s characterization of the scope of her claims. And in any event, the CBA is referenced in the assignment letters that Gola herself relies on to frame the assignment period her claims concern.
Second, Golа contends that even if the CBA must be consulted in this case, it need not be interpreted, and the University has pointed to no ambiguities in the CBA that a court would have to resolve to decide her claims. It is true that Gola‘s claims do not turn on the disputed meaning of an individual word or phrase in the CBA; rather, a factfinder would have to discern the intent and effect of several provisions of the CBA and the extent to which they were incorporated into the assignment letters the University sent to adjuncts, as we have described above. That is no less a task of interpretation than selecting among different definitions of an individual word or phrase.
Because Gola‘s first and third causes of action are preempted by section 301 of the LMRA, we affirm the trial court‘s dismissal of these claims.
The trial court awarded attorneys’ fees and costs to Gola because of her success on the section 226 cause of action. The University appeals the fee award based on its contention that the section 226 claim was incorrectly decided, but it does not contend that the trial court abused its discretion in setting the amount of fees. Because we have affirmed the section 226 judgment, we affirm the trial court‘s award of fees and costs.
DISPOSITION
The judgment is affirmed. Each party shall bear its own costs on appeal.
Van Aken, J.*
I concur:
Stewart, P.J.
Gola v. University of San Francisco (A161477, A162437)
* Judge of the San Francisco Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.
Gola v. University of San Francisco, A161477, A162437
Concurring and Dissenting Opinion of Miller, J.
I respectfully dissent from part I.B.2 of the majority opinion regarding the application of the abatement doctrine. As I explain, I would vacate the judgment and remand to the trial court to consider whether some or all of the
Plaintiff Kelly Gola and the members of the class she represents are adjunct professors. They sued the University of San Francisco (University) in part because their wage statements did not comply with the strict requirements of
But after the trial court issued its statement of decision and after judgment was entered, the Legislature enacted
We know from the record that the adjunct faculty members at the University (more than 600 people) are represented by a labor association and that for the time period covered by Gola‘s lawsuit, two collective bargaining agreements (CBA‘s) were in effect, one that took effect on July 1, 2015, and another dated July 1, 2018 and executed on August 2, 2019. Among other things, the July 1, 2018 CBA expressly states that the parties agreed “the classification of bargaining unit faculty are as professional employees.”
Thus, it appears that the University‘s conduct would no longer violate the wage statement requirements of
The doctrine of abatement was designed for consideration in this circumstance.
My colleagues correctly state the principle underlying the abatement doctrine, as articulated by our Supreme Court in Governing Board v. Mann (1977) 18 Cal.3d 819, 829 (Governing Board): “Although the courts normally construe statutes to operate prospectively, the courts correlatively hold under the common law that when a pending action rests solely on a statutory basis, and when no rights have vested under the statute, ‘a repeal of [such] a statute without a saving clause will terminate all pending actions based thereon.’ ”
As the court in Zipperer v. County of Santa Clara (2005) 133 Cal.App.4th 1013 (Zipperer) went on to amplify, “In other words, where ‘the Legislature has conferred a remedy and withdraws it by amendment or repeal of the remedial statute, the new statutory scheme may be applied to pending actions without triggering retrospectivity concerns. . . .’ (Brenton v. Metabolife Internat., Inc. (2004) 116 Cal.App.4th 679, 690.) Furthermore, legislative action ‘can effect a partial repeal of an existing statute.’ (Ibid.) ’ “The justification for this rule is that all
Where I part company with my colleagues is in the application of the abatement doctrine to this case.
Zipperer sets out a four-factor test for abatement: (1) “the statutory nature of the plaintiffs’ claim“; (2) “the unvested nature of plaintiffs’ claimed rights;” (3) “the timing of the elimination of those rights“; and (4) “the nature of the mechanism by which the right of action was eliminated.” (Zipperer, supra, 133 Cal.App.4th at p. 1023.) Considering the four-factor test on this record, my view is that the case must be remanded.
Applying the Zipperer factors here is straightforward. First, the
Fourth, when certain conditions of
Even if
In Rankin, a plaintiff sued Longs Drug Stores alleging that Longs violated
The court in Rankin acknowledged that the “familiar rule” is that when the Legislature is silent on its intent, the new statutory scheme is ordinarily construed to operate prospectively. (Rankin, supra, 169 Cal.App.4th at p. 1253.) “However, different considerations are implicated in the limited circumstances in which the Legislature enacts a statute that completely reverses substantive law by effectively permitting previously prohibited conduct.” Those enactments, when devoid of an express savings clause, “have led the courts to apply the common law principle of abatement to cоnclude all still pending actions brought under the old statute must be abated and dismissed.” (Id. at p. 1253.) The Rankin court discussed the breadth of this principle in civil and criminal cases, and, surveying cases (including Zipperer), wrote, “[w]hen a pending action seeks recovery based on a statutorily-based obligation, and that statutory provision is repealed by legislation not containing an express saving clause, the California courts have consistently concluded the pending actions should be abated.” (Rankin, at p. 1256.) The Rankin court recognized that the federal statute here “effect[ed] a partial
My colleagues view the fact that
In my view, my colleagues also misplace their focus when they apply as the test for repeal whether the new legislation is a ” ‘substantially reversal of legislative policy’ ” that represents ” ‘the adoption of an entirely new philosophy.’ ” (Maj. opn. at p. 17.) These phrases come from People v. One 1953 Buick 2-Door (1962) 57 Cal.2d 358 (One 1953 Buick), a case involving a forfeiture proceeding after the seizure of a car used to unlawfully transport narcotics. The opinion itself does not mention abatement. And read in context, these phrases do not articulate the criteria for whether abatement should apply, nor do they define a new test.
The only question to be determined on appeal in One 1953 Buick was whether, as the State argued, the former code provisions on forfeiture that were in effect when the car was seized should have been applied, or whether, as the commercial credit company that was the legal owner of vehicle argued, the trial court was correct in applying the amended statutes that went into effect after the seizure but before the forfeiture proceeding commenced. In essence, the former law required a bona fide lien holder who sought to assert its rights in a forfeiture action to establish that it had undertaken an invеstigation into the “moral responsibility, character, and reputation” of the purchaser and that it was “without any knowledge” that the vehicle would be
The Supreme Court in One 1953 Buick described as the “governing rule” that “it has been held in a long line of cases that the repeal of a statute creating a penalty, running either to an individual or the state, at any time before final judgment, extinguishes the right to recover the penalty,” and further that “a forfeiture of this nature ‘is a penalty to induce performance of [a] duty,’ and its penal character being obvious, the repeal of the statute authorizing the forfeiture extinguishes the right of forfeiture.” (One 1953 Buick, supra, 57 Cal.2d at pp. 362-363, quoting Lemon v. Los Angeles Terminal Ry. Co. (1940) 38 Cal.App.2d 659, 670, 671.) Having stated the rule, its application to the facts of this forfeiture case was clear: the trial court was correct.
But the Supreme Court went on to explain how this case presented “an excellent example of the wisdom of the rule” it had just stated, noting how the statutоry requirement that every prospective lien claimant make a reasonable investigation into the moral responsibility, character, and reputation of the purchaser had been in the law since 1933, and had once been described as having the “purpose of . . . ‘requir[ing] one who finances the purchase of an automobile to aid in the prevention of crime.’ ” (One 1953 Buick, supra, 57 Cal.2d at p. 363.) So when the legislature repealed the law in 1959, “this was not only a change in the ‘terms and conditions’ of forfeiture but was also a substantial reversal of legislative policy and represented the adoption of an entirely new philosophy relative to the rights of a bona fide lienholder in a forfeited vehicle,” as reflected in the repeal and in the amended statutes making it easier for lienholders to defend against forfeiture. The Supreme Court concluded that it was “thus clear that it is the present legislative conclusion that public policy does not require the forfeiture” of a legal owner‘s interest in a car that was used to transport narcotics where that owner failed to make an investigation into the moral responsibility and character of the purchase. And because the “only purpose” of that condition of forfeiture had been to “induce” legal owners into making such investigations, and “since the Legislature has now determined that public policy does not require such an investigation,” the court concluded that “it is difficult to conceive of any public purpose which could be served at this date by forfeiting the legal owner‘s interest in the automobile for his failure to make this investigation.” (Id. at pp. 363-364, italics added.)
Because the trial court did not have an opportunity to consider the evidence in this light, and there may be additional evidence or argument pertinent to the issue, I would vacate the judgment and remand to the trial court to consider whether the wage statement claims are abated by
For these reasons, I respectfully dissent from the majority‘s decision to affirm the judgment.
Miller, J.
Trial Court: San Francisco County Superior Court
Trial Judge: Hon. Curtis Karnow
Attorneys for Plaintiff and Appellant: Goldstein, Borgen, Dardarian & Ho Morris J. Baller
Katz, Marshall & Banks, LLP Daniel B. Edelman Pro Hac Vice
Hammondlaw, P.C. Julian Hammond Polina Brandler Ari Cherniak Arie Michelsohn Pro Hac Vice
Attorneys for Defendant And Respondent: Vartain Law Group, P.C. Michael J. Vartain Ross J. Vartain
Notes
In a similar vein, the University has requested we take judicial notice of examples of litigation it argues section 515.7 was intended to abate: a series of complaints and settlement approvals involving other colleges and universities. There is no indication these documents were before the Legislature (indeed, some of them were filed after enactment of section 515.7), and they add nothing to our consideration of references to litigation in the legislative history already before us. We deny the request as to these documents. (See Mangini v. R.J. Reynolds Tobacco Co. (1994) 7 Cal.4th 1057, 1063, overruled on other grounds by In re Tobacco Cases II (2007) 41 Cal.4th 1257 [“Although a court may judicially notice a variety of matters [citation], only relevant material may be noticed“].)
As the majority notes, the second CBA states on its cover page that its effective date is July 1, 2018, but we have not determined the effective date of the CBA‘s classification of adjuncts as professional employees. (Maj. opn. at pp. 9-10, fn. 2.) Further, a finding of abatement would affect the statutory damages, PAGA penalties and potentially attorneys’ fees and costs.