Hall v. Rite Aid Corp.

• Decision Date: 02 May 2014
• Docket Number: D062909
• Citation: 171 Cal.Rptr.3d 504,226 Cal.App.4th 278
• Court: California Court of Appeals Court of Appeals
• Parties: Kristin HALL, Plaintiff and Appellant, v. RITE AID CORPORATION, Defendant and Respondent.

226 Cal.App.4th 278

171 Cal.Rptr.3d 504

Kristin HALL, Plaintiff and Appellant,

v.RITE AID CORPORATION, Defendant and Respondent.

D062909

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

Filed May 2, 2014

See 4 Witkin, Cal. Procedure (5th ed. 2008) Pleading, § 313.

APPEAL from an order of the Superior Court of San Diego County, Joan M. Lewis, Judge. Reversed. (Super.Ct. No. 37–2009–00087938–CU–OE–CTL)

Dostart Clapp & Coveney, James F. Clapp, James T. Hannink, San Diego; Altshuler Berzon and Michael Rubin, San Francisco, for Plaintiff and Appellant.

AARP Foundation Litigation and Barbara A. Jones for AARP as Amicus Curiae on behalf of Plaintiff and Appellant.

Paul Hastings, Jeffrey D. Wohl, Rishi N. Sharma, Regan A. W. Herald, Elizabeth J. MacGregor and Peter A. Cooper, San Francisco, for Defendant and Respondent.

McDONALD, J.

Kristin Hall filed this action, on behalf of herself and similarly situated persons, alleging defendant Rite Aid Corporation did not provide seats to employees while the employees were operating cash registers at Rite Aid check-out counters in violation of section 14 of Wage Order 7–2001 (section 14) (Cal.Code Regs., tit. 8, § 11070(14)), promulgated by California's Industrial Welfare Commission (IWC). Section 14 requires an employer to provide employees with suitable seats “when the nature of the work reasonably permits the use of seats.” (Cal.Code Regs., tit. 8, § 11070(14)(A).)

The trial court initially granted Hall's motion for class certification. However, Rite Aid subsequently moved for decertification, citing additional evidence as well as decisions by other courts. The trial court granted Rite Aid's motion for decertification, and denied Hall's cross-motion to permit the action to proceed as a representative nonclass action under Labor Code section 2698 et seq. Hall appeals, contending (1) Rite Aid's decertification motion should have been denied because it was unsupported by an adequate showing of “changed circumstances”; (2) the trial court applied the wrong analytical approach and standards when it reevaluated the propriety of permitting Hall's action to proceed as a class action; (3) the trial court's order decertifying the class was based on an erroneous interpretation of section 14; and (4) the court erred when it denied Hall's cross-motion to permit the action to proceed as a representative nonclass action under the California Labor Code Private Attorneys General Act of 2004 (PAGA), codified in Labor Code section 2698 et seq.

We conclude that, under the analytic framework promulgated by Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004, 139 Cal.Rptr.3d 315, 273 P.3d 513 (Brinker ), the trial court erred when it decertified the class action because its decertification order was based on an assessment of the merits of Hall's theory rather than on whether the theory was amenable to class treatment.

IFACTUAL AND PROCEDURAL BACKGROUND

A. The Complaint

Hall is a former employee of Rite Aid, where she worked as a Cashier/Clerk. She filed a putative class action against Rite Aid to recover penalties pursuant to Labor Code § 2699, subdivision (f). She alleged Rite Aid violated Labor Code section 1198, which makes it illegal to employ a person under conditions of labor prohibited by an applicable IWC Wage Order. She alleged Rite Aid violated a condition of labor because it did not provide its Cashier/Clerks with suitable seats, in violation of section 14 of Wage Order 7–2001, which provides:

“(A) All working employees shall be provided with suitable seats when the nature of the work reasonably permits the use of seats.

“(B) When employees are not engaged in the active duties of their employment and the nature of the work requires standing, an adequate number of suitable seats shall be placed in reasonable proximity to the work area and employees shall be permitted to use such seats when it does not interfere with the performance of their duties.” (Cal.Code Regs., tit. 8, § 11070(14).)

B. The Class Certification Order

Hall moved for class certification. In support of the motion, she submitted evidence that (1) all Cashier/Clerks are covered by the same job description and have similar job duties, including check-out work; (2) on average, Cashier/Clerks spend a majority of their hours working at the register; (3) most check-out work (which largely involves scanning and bagging merchandise, processing payments, and handing the bags and receipt to the customer) can be done while seated, but Rite Aid required its Cashier/Clerks to stand while performing check-out work; and (4) Rite Aid's standard counter configurations could accommodate a seat with minimal modifications.

Rite Aid opposed the motion, arguing that individual issues would predominate. Rite Aid asserted (1) its stores differed in size, sales volume, number of Cashier/Clerks, and sales counter configurations; (2) when Cashier/Clerks are not performing check-out counter work they are tasked with duties that varied among the stores; and (3) the percentage of time each Cashier/Clerk spent behind the check-out counter varied from 2 percent to 99 percent (with an average of about 42 percent) and the time spent on stockroom or floor duties was equally varied. Rite Aid's evidence also showed that, even when performing duties at the check-out counter, the distance Cashier/Clerks had to move away from the register (to retrieve controlled items such as tobacco and liquor) varied depending on the specific configuration of each store, and they often or very often performed tasks requiring them to lift, bend, twist, lean over, or move around while working at the check-out register. Because of the variety of tasks, 69 percent of surveyed Cashier/Clerks reported they spent at least half their time moving behind the counter, and 31 percent reported they spent at least 3/4 of their time moving behind the counter.

Hall, whose proffered theory of recovery was that the work performed by Cashier/Clerks when stationed at the check-out registers reasonably permits the use of seats and therefore the failure to provide seats violated section 14, asserted many of these variations were irrelevant to her theory and therefore were not an obstacle to class certification. Hall argued the lack of uniformity in the sizes and configurations of the stores, or the variations in the amount of time Cashier/Clerks reported spending working at the check-out counter, had no relevance to whether the failure to provide seats violated section 14 because the nature of the check-out work itself reasonably permitted the use of a seat. In October 2011 the trial court granted the motion for class certification.

C. The Decertification Motion

Three weeks before trial, the parties discussed the proposed trial plan at the trial readiness conference. Hall's proposal, which appears to have contemplated presenting plaintiff's case in seven days with testimony from 10 Cashier/Clerks, along with her ergonomist and Rite Aid employees regarding general company policies and practices, was challenged by Rite Aid's counsel because of due process issues discussed in a recently published opinion.¹ Hall's counsel conceded that, if the court believed the present case fell under the rationale of Duran, it would take “months” to try the matter. The court ordered supplemental briefing on the trial plan and on the impact of Duran.

Hall argued Duran had no application, and the sole question—whether “the nature of the work of a Cashier/Clerk at the front-end cash register reasonably permits the use of a seat”—was amenable to representative proof. Rite Aid's supplemental brief argued Hall had not proposed a manageable trial plan because it did not ensure that statistically valid representative proof would be provided on myriad questions,² and it would deny Rite Aid its due process right to present evidence refuting claims of specific class members. Rite Aid argued that, considering the absence of a manageable trial plan, the court sua sponte should decertify the class.

The court stated it did not at that point have enough information for it sua sponte to order the class decertified, but agreed to hear a motion to decertify. Rite Aid's motion relied on declarations from 11 Cashier/Clerks who had “opted out” of the class, excerpts from depositions of Hall's class declarants, and recent decisions from federal district courts.³ Rite Aid argued any violation of section 14 required a two-step inquiry: first, the court needed to decide what was the “nature of the work” of Cashier/Clerks, and second, whether that work “reasonably permits” the use of a seat. Rite Aid argued that, under section 14, the “nature of the work” inquiry requires examination of the job “as a whole,” rather than whether some discrete subpart of the employee's duties was amenable to being performed while seated. Rite Aid argued the variations among class members as to their job as a whole, including the amount of time they spend at the check-out counter compared with other duties, the types of physical activity required even when stationed at the check-out counter, and the physical configurations among hundreds of Rite Aid stores, made class treatment improper because the “nature of the work” of any specific Cashier/Clerk required individualized inquiries for each class member, and whether that work would “reasonably permit” the use of a seat would also require individualized determinations based on the physical characteristics for each check-out counter.

Hall raised both procedural and substantive reasons to oppose decertification. She asserted a decertification motion must be based on new law or new facts and Rite Aid had not adequately shown either prerequisite. Hall also asserted that variations among Cashier/Clerks as to their job duties were irrelevant because class certification depends on the plaintiff's “theory of recovery,” and her theory was that Rite Aid's policy requiring its...