Aguilar v. Association for Retarded Citizens

• Decision Date: 09 September 1991
• Docket Number: No. D014154,D014154
• Citation: 234 Cal.App.3d 21,285 Cal.Rptr. 515
• Court: California Court of Appeals Court of Appeals
• Parties: , 30 Wage & Hour Cas. (BNA) 889, 125 Lab.Cas. P 57,421 Linda Kay AGUILAR et al., Plaintiffs and Appellants, v. ASSOCIATION FOR RETARDED CITIZENS, Defendant and Respondent.

Page 515

285 Cal.Rptr. 515

234 Cal.App.3d 21, 30 Wage & Hour Cas. (BNA) 889,

125 Lab.Cas. P 57,421

Linda Kay AGUILAR et al., Plaintiffs and Appellants, v. ASSOCIATION FOR RETARDED CITIZENS, Defendant and Respondent.

No. D014154.

Court of Appeal, Fourth District, Division 1, California.

Sept. 9, 1991.

[234 Cal.App.3d 23] Stuart M. Kaye, for plaintiffs and appellants.

Littler, Mendelson, Fastiff & Tichy, Scott A. Wilson and Jody A. Landry, for defendant and respondent.

KREMER, Presiding Justice.

The issue in this case is whether the Association for Retarded Citizens (ARC) is required to pay employees who work less than 24-hour shifts for time when the employees are allowed to sleep. We conclude ARC is required to compensate the employees for all the hours they are subject to ARC's control, including hours when the employees are allowed to sleep.

FACTS

ARC is a state funded, non-profit organization which provides care for mentally handicapped individuals throughout the Imperial Valley. ARC operates group homes for these mentally handicapped individuals. ARC employs individuals at the group homes to stay with the mentally handicapped individuals, overseeing their housekeeping, meals, homework and other needs.

The employees involved in this case worked a four-day work week with four days on and three days off. For the first two days of their work week, employees would arrive at 2 p.m. and work until 10 p.m., an eight-hour shift. ARC then required the employees to stay at the group home for an overnight work shift. From 10 p.m. to 6 a.m., the employees were on call but ARC allowed them to sleep. Typically, ARC provided a bed or sofa bed in the group home's study room for the employee to sleep. This room also generally contained a telephone.

From 6 a.m. until 9 a.m., the employees actively worked, helping home residents with their morning routines and preparing for school. The employees were then free to pursue their own interests, either on or off the premises, until 2 p.m. when the residents returned from school. For the second two days of the work week, the employees would work from 2 to 10 p.m. and then go home.

ARC paid employees for the overnight work shift if the employees received less than five hours sleep or spent more than three hours assisting one of the handicapped individuals in the group home. Otherwise the employees would receive no compensation for the 10 p.m. to 6 a.m. shift.

Several ARC employees filed claims with California's Department of Labor Standards Enforcement (DLSE) against ARC for unpaid wages, i.e., for excluding sleep time from the number of hours worked. DLSE concluded employees who worked less than 24-hour shifts were entitled to compensation for hours when they were subject to the employer's control even though permitted to sleep. Beginning in 1984, the employees sued ARC in municipal court for unpaid wages. These cases were eventually consolidated.

ARC brought a motion for summary judgment, contending that, as a matter of law, the employees were not entitled to wages for the hours they spent sleeping at the group home. The municipal court judge granted summary judgment in favor of ARC reasoning the DLSE's policy was an unenforceable regulation which had been adopted without complying with statutory procedures.

The employees appealed to the Appellate Division of the Superior Court which affirmed. The Appellate Division concluded federal law governed and that under the federal law employees who were released for only a few hours a day worked a 24-hour shift and employers were not required to provide sleep time compensation for employees who worked 24-hour shifts. At the employees' request, the Appellate Division of the Superior Court certified the case for transfer to this court. We issued an order transferring the case to this court for hearing and decision.

DISCUSSION

I

The Definition of "Hours Worked"

Whether sleep time is compensable turns on the interpretation of Wage Order 5-80, section 2(H) ¹ which provides:

" 'Hours worked' means the time during which an employee is subject to the control of an employer, and includes all the time the employee is suffered or permitted to work, whether or not required to do so and in the case of an employee who is required to reside on the employment premises, that time spent carrying out assigned duties shall be counted as hours worked."

Wage Order 5-80 was promulgated by the Industrial Welfare Commission (IWC) which regulates the wages, hours and working conditions for California employees. (Lab.Code, § 1173.) DLSE is authorized to enforce the IWC's orders. (Lab.Code, §§ 61, 1193.5; Alcala v. Western Ag Enterprises (1986) 182 Cal.App.3d 546, 551, 227 Cal.Rptr. 453.)

II

The Division's Interpretation is Not An Improper Regulation

ARC contends the Division's "interpretation"--that section 2(H) requires ARC to compensate the employees for hours when the employees are permitted to sleep--is entitled to no weight because it is, in reality, a regulation which was adopted without complying with the Administrative Procedures Act (APA) (Gov.Code, § 11340 et seq.).

The APA establishes "basic minimum procedural requirements for the adoption, amendment or repeal of administrative regulations." (Gov.Code, § 11346.) The APA is "applicable to the exercise of any quasi-legislative power conferred by any statute" but does not effect additional requirements imposed by other statutes. (Gov.Code, § 11346.)

The APA defines a regulation as

"every rule, regulation, order, or standard of general application or the amendment, supplement or revision of any such rule, regulation, order or standard adopted by any state agency to implement, interpret, or make specific the law enforced or administered by it, or to govern its procedure, except one which relates only to the internal management of the state agency. 'Regulation' does not mean or include legal rulings of counsel issued by the Franchise Tax Board or State Board of Equalization, or any form prescribed by a state agency or any instructions relating to the use of the form, but this provision is not a limitation upon any requirement that a regulation be adopted pursuant to this part when one is needed to implement the law under which the form is issued." (Gov.Code, § 11342, subd. (b).)

The difference between interpreting a regulation to enforce it and adopting a new regulation was examined in Skyline Homes, Inc. v. Department of Industrial Relations (1985) 165 Cal.App.3d 239, 211 Cal.Rptr. 792. An IWC standard required payment of time and one-half the regular rate of pay for overtime. The DLSE concluded an employer was in violation of the standard by reading "regular rate of pay" to mean the result of dividing the weekly straight-time salary by no more than 40 hours. The Skyline court rejected the argument the DLSE's action was adoption of a regulation rather than an interpretation of the IWC order.

"The relationship between the DLSE and the IWC is similar to that between the Occupational Safety and Health Standards Board and the Division of Occupational Safety and Health. The division is charged with the power to 'adequately enforce and administer all laws and lawful standards and orders ...' regarding safety in workplaces [citations]. The standards board, like the IWC, is responsible for adopting standards [citations].

"In the case of Bendix Forest Products Corp. v. Division of Occupational Saf. & Health (1979) 25 Cal.3d 465 [158 Cal.Rptr. 882, 600 P.2d 1339], the standards board had adopted a regulation providing that hand protection may be required for employees whose work exposes their hands to dangerous substances, cuts or burns [citation]. Pursuant to this standard the division ordered the employer, a lumber company, to provide hand protection to its employees at company expense. The employer contended that the division was attempting to legislate a new standard and was encroaching on the authority of the standards board. The court held that '[t]he decision of the Division was not a quasi-legislative judgment promulgating a new regulation or standard but rather a specific application of laws and existing regulations. We see no conflict in the exercise of power vis-a-vis the Standards Board.' [Citation.]

"Similarly, in this case, the DLSE is not promulgating regulations. The regulation is wage order 1-76, properly promulgated by the IWC. The DLSE is charged with enforcing the wage orders, and to do so, it must first interpret them. The enforcement policy is precisely that--an interpretation--and need not comply with the APA." (Id. at p. 253, 211 Cal.Rptr. 792.)

In this case as well the IWC Wage Order was properly applied. DLSE's action here amounted to no more than an interpretation of that Wage Order and its application to a specific situation. DLSE's interpretation did not create a new rule or policy; it construed the words of the IWC Wage Order. The fact DLSE did not adopt ARC's interpretation does not mean that DLSE must have engaged in rule-making rather than interpretation. Adoption of an interpretation consistent with the language and intention of the Wage Order as a prelude to enforcement does not require compliance with the APA.

ARC argues Armistead v. State Personnel Board (1978) 22 Cal.3d 198, 149 Cal.Rptr. 1, 583 P.2d 744 and Ligon v. State Personnel Bd. (1981) 123 Cal.App.3d 583, 176 Cal.Rptr. 717, support its position DLSE's interpretation of Wage Order 5-80 was the promulgation of a regulation. In these cases, the State Personnel Board adopted new rules or policies applicable to state employees.

In Armistead v. State Personnel Board, supra, 22 Cal.3d 198, 149 Cal.Rptr. 1, 583 P.2d 744, the State Personnel Board adopted a rule in its Personnel Transactions Manual which did not allow an employee to withdraw his/her resignation at some future date unless the appointing agency gave its approval. This rule contrasted with the Board's rule which merely stated that an...