Kawashima ex rel. Situated v. State
| Decision Date | 28 June 2017 |
| Docket Number | SCAP-15-0000462 |
| Citation | 398 P.3d 728 |
| Parties | Diane KAWASHIMA, Individually and on Behalf of all others Similarly Situated, Petitioner/Plaintiff-Appellee/Cross-Appellant, v. STATE of Hawai'i, Department of Education; Kathryn S. Matayoshi, in her Official Capacity as Superintendent of Schools; Lance A. Mizumoto, Brian J. Delima, Patricia Bergin, Grant Y.M. Chun, Maggie Cox, Hubert Minn, Kenneth Uemura, Bruce Voss, Jim Williams, Andrea Lyn Mateo, and Colonel Peter P. Santa Ana, in their Official Capacities as Members of the State of Hawai'i Board of Education, Respondents/Defendants-Appellants/Cross-Appellees David Garner, Patricia Smith, Andrea Christie, Allan Kliternick, Karen Souza, Jo Jennifer Goldsmith, and David Hudson, on Behalf of Themselves and all others Similarly Situated, Petitioners/Plaintiffs-Appellees, v. State of Hawai'i, Department of Education, Respondents/Defendants-Appellants. Allan Kliternick, David Garner, Jo Jennifer Goldsmith, and David Hudson, Individually and on Behalf of all others Similarly Situated, Petitioners/Plaintiffs-Appellees, v. Kathryn S. Matayoshi, in her Official Capacity as Superintendent of Schools, Lance A. Mizumoto, Brian J. Delima, Patricia Bergin, Grant Y.M. Chun, Maggie Cox, Hubert Minn, Kenneth Uemura, Bruce Voss, Jim Williams, Andrea Lyn Mateo, and Colonel Peter P. Santa Ana, in Their Official Capacity as Members of the State of Hawai'i Board of Education, Department of Education, State of Hawai'i, Respondents/Defendants-Appellants. |
| Court | Hawaii Supreme Court |
William J. Wynhoff and David D. Day for appellants.
Paul Alston and Eric G. Ferrer, Honolulu, for appellees.
RECKTENWALD, C.J., NAKAYAMA, AND WILSON, JJ., CIRCUIT JUDGE CHANG, IN PLACE OF McKENNA, J., RECUSED, AND CIRCUIT JUDGE CRANDALL, IN PLACE OF POLLACK, J., RECUSED
This is a consolidated case involving substitute and part-time temporary teachers who were employed by the State of Hawai'i, Department of Education ("State" or "DOE"), and who claim they were underpaid by the State.
Plaintiffs in the Garner case include more than 8,000 substitute teachers (collectively "Garner Plaintiffs" or "substitute teachers") who were paid on a per diem basis. Approximately half of the substitute teachers in Garner also worked in a part-time capacity for which they were paid hourly wages.
During a prior interlocutory appeal in Garner , the Intermediate Court of Appeals (ICA) found that the circuit court properly ruled that the substitute teachers were underpaid and thus entitled to their per diem back wages pursuant to Hawai'i Revised Statutes (HRS) § 302A-624(e). See Garner v. State , 122 Hawai'i 150, 154-55, 223 P.3d 215, 219-20 (App. 2009) ( Garner I ). On remand, the circuit court ruled that the Plaintiff class included the substitute teachers who were paid hourly wages and calculated the amount of those wages due, and that Plaintiffs were entitled to interest on their hourly and per diem back wages under HRS § 103-10.
In 2014, the State paid a partial settlement to Garner Plaintiffs in the amount of $14,031,874.70, which settled all per diem wage claims for the claim period from November 8, 2000 through June 30, 2005. The State continued to dispute its liability regarding the payment of the substitute teachers' hourly back wages, and whether the teachers are entitled to interest on their per diem and hourly wages.
In 2015, the Circuit Court of the First Circuit (circuit court) entered final judgment in Garner , awarding hourly back wages to Plaintiffs who worked in a part-time capacity in the amount of $6,789,175.21 for the period from November 8, 2000 through June 12, 2012.1 The circuit court also awarded interest on both the per diem and hourly back wages owed, in the amount of $13,542,186.74.
Plaintiffs in the Kawashima case include approximately 20,000 part-time temporary teachers (collectively "Kawashima Plaintiffs," "part-time teachers" or "PTTs") who were paid on an hourly basis. Similar to the substitute teachers claiming hourly back wages in Garner , the PTTs in Kawashima argued that their hourly pay rate, which was set forth in School Code Regulation 5203, was linked to the substitute teachers' per diem pay rate under HRS § 302A-624(e). Thus, based on the claimed linkage between Regulation 5203 and HRS § 302A-624(e), the PTTs argued that because the substitute teachers were underpaid, they too were underpaid. The circuit court in Kawashima ruled that the PTTs were underpaid and entitled to hourly back wages in the amount of $24,026,329.52 for the period from February 20, 2004 through June 12, 2012.2 In contrast to Garner , however, the circuit court in Kawashima ruled that the PTTs were not entitled to interest on their unpaid hourly wages under HRS § 103-10. Nevertheless, the circuit court determined that had Plaintiffs been entitled to interest on their hourly back wages under HRS § 103-10, they would have been entitled to interest payments in the amount of $9,450,085.40.
On appeal in Garner , the State argues that the circuit court erred in: (1) determining that Plaintiffs' claims for hourly back wages were "properly part of this case"; (2) determining that School Code Regulation 5203 is an HRS chapter 91 rule; (3) granting summary judgment in favor of the substitute teachers on their hourly back wages contract claim; and (4) determining that the substitute teachers were entitled to interest on their hourly and per diem back wages under HRS § 103-10.
On appeal in Kawashima , the State argues that the circuit court erred in: (1) determining that School Code Regulation 5203 is an HRS chapter 91 rule; and (2) denying the State's motion for summary judgment on the PTTs' hourly back wages contract claim. Kawashima Plaintiffs also cross-appealed the circuit court's rulings, arguing that they are entitled to interest on their unpaid hourly wages under HRS § 103-10.
This court accepted transfer of both Garner and Kawashima , and subsequently consolidated the cases.
We conclude that Plaintiffs are not entitled to hourly back wages, or interest on any back wages (whether per diem or hourly) under HRS § 103-10. Because we decide the case on the merits, we do not reach the question of whether the substitute teachers' hourly back wages were properly within the scope of the Garner Plaintiffs' claims.
Therefore, the circuit court's May 19, 2015 judgment in Garner is reversed and remanded for entry of judgment in favor of the State. Additionally, the circuit court's May 18, 2015 judgment in Kawashima is affirmed in part to the extent that the circuit court determined that Plaintiffs are not entitled to interest under HRS § 103-10, and reversed on all other remaining grounds and remanded for entry of judgment in favor of the State.
We first provide essential background information regarding the compensation of substitute teachers and PTTs employed by the State.
A. Substitute Teachers' Compensation
In 1996, the legislature recodified the education statutes and enacted HRS § 302A-624(e) (Supp. 1997), which established the following per diem rate of pay for substitute teachers:
A "Class II teacher" is defined as "any teacher who holds a certificate issued by the department based upon four acceptable years of college education and other requirements as may be established by the department[.]"3 HRS § 302A-618(b)(2) (Supp. 1997).
B. Part-Time Teachers' Compensation
Since at least 1945, the DOE has had a body of internal guidelines called the "School Code." In 1976, the Board of Education (BOE) adopted School Code Regulation 5203, which linked the hourly wage of PTTs to the per diem wage paid to substitute teachers. Regulation 5203 provides:
The regulation remained unamended until 2005, when the first of a series of changes occurred. In January 2005, the DOE issued a new version of the Regulation 5203, which stated, "Compensation for Part-time Temporary Teachers on an hourly basis shall be determined by the [DOE]." In a July 2005 memorandum, Superintendent Patricia Hamamoto adjusted the pay rate of PTTs as follows:
In 2006, the BOE retroactively ratified the Superintendent's July 2005 memorandum establishing the PTTs' pay rate. In 2009, the DOE issued "Standard Practice Document SP 5203" (SP 5203), which was intended to supersede Regulation 5203 that was amended January 2005. SP 5203 stated that compensation for PTTs "shall be determined by the Department." In 2012, the DOE adopted Hawai'i Administrative Rules (HAR) chapter 8-66 (effective June 14, 2012) pursuant to ...
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