Champagne v. Thurston County

• Court: Washington Supreme Court
• Writing for the Court: Fairhurst
• Citation: Champagne v. Thurston County, 178 P.3d 936, 163 Wash.2d 69 (Wash. 2008)
• Decision Date: 14 February 2008
• Docket Number: No. 79209-7.
• Parties: Gene CHAMPAGNE, Cary Brown, Roland Knorr, and Christopher Scanlon, individuals and as representatives of a class of Thurston County overtime eligible employees, Petitioners, v. THURSTON COUNTY, a political subdivision of the state of Washington, Respondent.

178 P.3d 936

163 Wash.2d 69

Gene CHAMPAGNE, Cary Brown, Roland Knorr, and Christopher Scanlon, individuals and as representatives of a class of Thurston County overtime eligible employees, Petitioners, v. THURSTON COUNTY, a political subdivision of the state of Washington, Respondent.

No. 79209-7.

Supreme Court of Washington, En Banc.

Argued September 27, 2007.

Decided February 14, 2008.

William B. Aitchison, Attorney at Law, Mark A. Crabtree, Portland, OR, Hillary H. McClure, Aitchison & Vick Inc., Seattle, WA, for Petitioners.

Jeffrey George Fancher, Attorney at Law, Olympia, WA, Michael Barr King, Talmadge Law Group PLLC, Tukwila, WA, Douglas Edward Smith, Littler Mendelson, Seattle, WA, for Respondent.

Nicholas Broten Straley, Daniel Ford, Columbia Legal Services, Seattle, WA, for Amicus Curiae on behalf of Centro De Ayuda (casa).

Valerie Anne Carlson, King County Bar Association, Seattle, WA, for Amicus Curiae on behalf of King County Bar.

Rebecca A. Smith, National Employment Law Project, Olympia, WA, for Amicus Curiae on behalf of National Employment Law Project.

Joseph Robert Shaeffer, MacDonald Hoague & Bayless, Jeffrey Lowell Needle, Seattle, WA, for Amicus Curiae on behalf of Washington Employment Lawyers Assoc.

FAIRHURST, J.

¶ 1 Thurston County (County) pays its employees for nonregular wages (e.g., overtime wages) at the close of the month subsequent to when the nonregular wages were earned. Petitioners Gene Champagne, Cary Brown, Roland Knorr, and Christopher Scanlon (hereinafter collectively referred to as Champagne) work as corrections officers for the Thurston County Sheriff's Office. Champagne challenges a published Court of Appeals decision that dismissed his claims under the Washington Minimum Wage Act, chapter 49.46 RCW (MWA), wage payment act, chapter 49.48 RCW (WPA), and wage rebate act, chapter 49.52 RCW (WRA) since all wages owed Champagne were eventually paid. He argues that (1) delayed payment of wages beyond the time frame set forth in former WAC 296-128-035 (1989) gives rise to employer liability under the aforementioned statutes and (2) such claims, being statutorily based, are not subject to the claim filing statutes applicable to counties.

¶ 2 We affirm the Court of Appeals but for different reasoning. We hold (1) that delayed payment of wages beyond the timeframe set forth in former WAC 296-128-035 gives rise to employer liability under the WRA but only where such delay is willful, and here it was not willful; (2) that delayed payment of wages does not give rise to employer liability under the MWA; and (3) that the WPA does not apply outside the termination context. Since Champagne lacks a viable cause of action, we decline to reach the issue of whether claims made under the WRA, MWA, or WPA are subject to county claim filing statutes.

I. FACTUAL AND PROCEDURAL HISTORY

¶ 3 The administration of the County payroll system triggered the present controversy. The County pays its employees once a month on the last business day of each month for the regular wages earned that month. Employees who have earned additional compensation such as overtime pay, compensatory time, specialty pay, supervisor pay, or holiday pay (hereinafter collectively referred to as additional pay)¹ must submit a form to the County by the end of the month for processing. The County pays additional pay at the end of the month subsequent to the month in which it is earned.² This practice is memorialized in the governing collective bargaining agreement between the County and its employees with respect to compensatory time and wages for overtime.³ Champagne is employed by the Thurston County Sheriff's Office as a corrections officer and is eligible for additional pay. Champagne asserts that the County's practice of paying additional pay the month after it is earned violates Washington's wage statutes.

¶ 4 On September 17, 2004, Champagne filed suit against the County in Thurston County Superior Court seeking class certification and claiming that the separate payday for additional pay violates the MWA, WPA, and WRA. In his complaint, Champagne prayed for the following relief: (1) twice the amount of additional pay pursuant to the WRA, (2) class certification, (3) attorney fees and costs under all three wage statutes, (4) prejudgment interest, and (5) any other equitable relief as the court deems just. Prior to filing suit, Champagne did not file a claim for damages with the County.

¶ 5 The County moved for summary judgment arguing that Champagne failed to meet the "condition precedent" of filing the claim with the County pursuant to RCW 36.45.010 and chapter 4.96 RCW (hereinafter collectively referred to as nonclaim statutes). Clerk's Papers (CP) at 42. Champagne countered that the nonclaim statutes do not apply to wage-and-hour claims. Visiting Judge Hogan⁴ held that Champagne's claims were subject to the nonclaim statutes, granted the County's motion for summary judgment, and dismissed the claim without prejudice. Champagne responded by filing a notice of appeal, submitting a claim for damages with the County, and filing a new lawsuit against the County.⁵

¶ 6 The Court of Appeals, Division Two, affirmed on alternative grounds and did not reach the issue of whether wage-and-hour claims are subject to the conditions set forth in the nonclaim statutes. Champagne v. Thurston County, 134 Wash.App. 515, 520 n. 7, 141 P.3d 72 (2006). Instead, Judge Hunt, writing for a unanimous panel, found that this court's holding in Seattle Professional Engineering Employees Association v. Boeing Co., 139 Wash.2d 824, 991 P.2d 1126, 1 P.3d 578 (2000) (SPEEA) precluded a cause of action for delayed payment of wages.

Correction Officers alleged in their complaint only that they were entitled to double damages under RCW 49.52.070. In so doing, they failed to state an actionable claim because, under Washington's wage-and-hour laws, employees are entitled to damages only where an employer has paid no compensation to an employee. Such is not the case here, however, because, as Correction Officers acknowledge, the County did pay them their due wages.

Champagne, 134 Wash.App. at 519, 141 P.3d 72 (citation omitted).

¶ 7 This court granted Champagne's petition for review. Champagne v. Thurston County, 160 Wash.2d 1010, 161 P.3d 1026 (2007).

II. ISSUE

¶ 8 Does the WRA, MWA, or WPA provide a cause of action for delayed payment of wages?

III. ANALYSIS

¶ 9 This court reviews questions of law de novo. Wingert v. Yellow Freight Sys., Inc., 146 Wash.2d 841, 847, 50 P.3d 256 (2002). "In reviewing an order granting summary judgment, the appellate court engages in the same inquiry as the trial court." Id. Summary judgment is appropriate when "there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law." Id.; CR 56(c). The court will consider the evidence in the light most favorable to the nonmoving party drawing all reasonable inferences therefrom. Wingert, 146 Wash.2d at 847, 50 P.3d 256.

¶ 10 This court has described Washington as a "`pioneer'" in assuring payment of wages due an employee. Int'l Ass'n of Fire Fighters, Local 46 v. City of Everett, 146 Wash.2d 29, 35, 42 P.3d 1265 (2002) (quoting Drinkwitz v. Alliant Techsystems, Inc., 140 Wash.2d 291, 300, 996 P.2d 582 (2000)). Toward that end, three wage statutes penalize an employer who willfully withholds wages (WRA), fails to pay the statutory minimum wage (MWA), or fails to pay wages due upon termination of employment (WPA). The court is tasked with construing these laws "`liberally'" in light of the strong public policy to protect workers' rights. Id. at 35, 42 P.3d 1265 (quoting Ellerman v. Centerpoint Prepress, Inc., 143 Wash.2d 514, 520, 22 P.3d 795 (2001)).

A. Does the amended version of WAC 296-128-035 apply retroactively?

¶ 11 Pursuant to the MWA, WAC 296-128-035 designates the time by which an employer must pay all wages due.⁶ Champagne relies upon the rule as it existed at the time he filed his suit in September 2004. In its entirety, former WAC 296-128-035 provided:

All wages due shall be paid at no longer than monthly intervals to each employee on established regular pay days. To facilitate bookkeeping, an employer may implement a regular payroll system in which wages from up to seven days before pay day may be withheld from the pay period covered and included in the next pay period.

Champagne maintains that the County violated former WAC 296-128-035 since the County paid additional pay the month after it was earned. The County, however, urges the court to apply the amended WAC retroactively.

¶ 12 Current WAC 296-128-035 is similar to its former version but includes additional direction. The current WAC provision states, "[a]n employer shall pay all wages owed to an employee on an established regular pay day at no longer than monthly payment intervals." WAC 296-128-035(3). The additional direction provides:

An employer shall pay overtime wages owed to an employee on the regular pay day for the pay period in which the overtime wages were earned. If the correct amount of overtime wages cannot be determined until after such regular pay day, the employer may establish a separate pay day for overtime wages; provided, that the payment of overtime wages may not be delayed for a period longer than that which is reasonably necessary for the employer to compute and arrange for payment of the amount due, and overtime wages must be paid by the regular pay day following the next pay period.

WAC 296-128-035(6). Furthermore, the rule may be "superseded by a collective bargaining agreement" subject to certain conditions.⁷ WAC 296-128-035(8).

¶ 13 Champagne concedes that he lacks a cause of action under current WAC 296-128-035 given that sections six and eight would permit the month delay for additional pay. Therefore, the court must determine whether the former or current WAC provisions apply. In other words, is the...