Honeycutt v. Wash. State , Dep't of Labor & Indus.

• Decision Date: 30 January 2017
• Docket Number: No. 74338-4-I,74338-4-I
• Citation: 389 P.3d 773,197 Wash.App. 707
• Court: Washington Court of Appeals
• Parties: Rachelle HONEYCUTT and Daniel Westergreen, Appellants, v. Washington STATE, DEPARTMENT OF LABOR & INDUSTRIES, Respondents, and Phillips 66 Company, Intervenors.

197 Wash.App. 707

389 P.3d 773

Rachelle HONEYCUTT and Daniel Westergreen, Appellants,

v.Washington STATE, DEPARTMENT OF LABOR & INDUSTRIES, Respondents,andPhillips 66 Company, Intervenors.

No. 74338-4-I

Court of Appeals of Washington, Division 1.

FILED: January 30, 2017

Danielle Elizabeth Franco-Malone, Kathleen Phair Barnard, Schwerin Campbell Barnard Iglitzin & Lav, 18 W. Mercer St., Ste 400 Seattle, WA, 98119-3971, for Appellants

Robert Alan Blackstone, Paula Camille Simon, Davis Wright Tremaine LLP, 1201 3rd Ave., Ste. 2200, Seattle, WA, 98101-3045, Diana Sheythe Cartwright, Attorney General's Office, 800 5th Ave., Ste. 2000, Seattle, WA, 98104-3188, for Respondents.

Sean M. Phelan, Frank Freed Subit & Thomas, 705 2nd Ave., Ste. 1200, Seattle, WA, 98104-1798, Janet S. Chung, Legal Voice, 907 Pine St., Ste. 500, Seattle, WA, 98101-1818, as Amicus Curiae on behalf of Legal Voice.

Sean M. Phelan, Frank Freed Subit & Thomas, 705 2nd Ave., Ste. 1200, Seattle, WA, 98104-1798, Janet S. Chung, Legal Voice, 907 Pine St., Ste. 500, Seattle, WA, 98101-1818, as Amicus Curiae on behalf of Economic Opportunity Institute.

Sean M. Phelan, Frank Freed Subit & Thomas, 705 2nd Ave., Ste. 1200, Seattle, WA, 98104-1798, Janet S. Chung, Legal Voice, 907 Pine St., Ste. 500, Seattle, WA, 98101-1818, as Amicus Curiae on behalf of Washington State Labor Council.

Spearman, J.¶1 The family care act (FCA), chapter 49.12 RCW, does not require employers to provide paid leave. But where an employer provides paid leave for an employee's own use, the FCA mandates that the employee may use that leave to care for an eligible family member. RCW 49.12.270. If more than one type of leave is available, the employee may choose which type of "sick leave or other paid time off" to use for family care. RCW 49.12.270(1). When an employee takes time off to care for a sick family member and the employer does not allow paid time off "for illness," the FCA allows the employee to access paid leave provided through a disability plan. RCW 49.12.265(5). Disability plans maintained through insurance or governed by the employee security retirement income security act of 1974 (ERISA)¹ are exempt from this provision of the FCA. Id.

¶2 We are asked to decide whether, in the context of the FCA, time allowed to an employee "for illness" is the equivalent of "sick leave." We conclude that it is and reverse the Department of Labor & Industries' (Department) ruling to the contrary. We remand for a determination of whether Phillips 66 Company's disability plan is exempt from the FCA because it is maintained through insurance or governed by ERISA.

FACTS

¶3 Phillips 66 does not provide sick leave. When employees of Phillips 66 miss work due to illness, they may receive paid time off through a short term disability (STD) plan. The STD plan functions much like traditional sick leave. To use STD benefits, an employee notifies a supervisor within twenty-four hours of an absence due to illness or injury. If such an absence lasts five or more days, the employee must provide a medical certificate. Based on the length of time an employee has worked for Phillips 66, the STD plan provides full pay for one to twenty-six weeks and sixty percent pay for the remaining weeks in a calendar year. STD benefits are reduced by any state mandated sick pay the employee is eligible to receive.

¶4 Under a collective bargaining agreement (CBA), Phillips 66 also provides employees with two paid personal holidays each year and a number of paid vacation days based on the length of time the employee has worked for the company. Employees bid for specific vacation days each fall for the subsequent calendar year. Vacation days are provided for the purpose of "rest and recreation." Clerk's Papers (CP) at 315. However, Phillips 66 permits employees to use vacation days or personal holidays instead of STD benefits when they miss work due to illness.

¶5 When an employee takes time off to care for a sick family member, the company allows the employee to use any available personal or vacation days. Phillips 66 does not allow employees to use STD benefits to care for a family member.

¶6 Rachelle Honeycutt and Daniel Westergreen work at a refinery operated by Phillips 66. In 2013, Honeycutt and Westergreen ("Honeycutt" or "the employees") both requested leave from work to care for sick family members. Phillips 66 approved the absences and gave the employees the option of using vacation days or taking time off without pay. The employees took time off without pay because they had already bid for vacation slots and made plans for those days.

¶7 The employees contacted their union, United Steelworkers Local 12-590. The union demanded that the company allow employees to access STD benefits to care for sick family members as required by the FCA. Phillips 66 took the position that its STD plan is an ERISA plan to which the FCA does not apply.

¶8 Honeycutt filed a complaint with the Department of Labor & Industries. The Department determined that Phillips 66 did not violate the FCA. The Department concluded that the FCA only reaches a disability plan if that plan is the only means by which an employee may receive paid leave for illness. Because Phillips 66's employees may use vacation days for illness, the Department ruled that the FCA's provision for reaching disability plans did not apply. The Department did not rule on whether Phillips 66's STD plan was governed by ERISA.

¶9 An administrative law judge (ALJ) affirmed the Department's decision.² The ALJ did not rule on whether Phillips 66's STD plan was exempt from ERISA. The director of the Department adopted the ALJ's findings of fact and conclusions of law and affirmed the ruling. The employees appealed to Whatcom County Superior Court, which also affirmed the Department's decision. Honeycutt appealed to this court.

DISCUSSION

¶10 The Administrative Procedure Act (APA), chapter 34.05 RCW, governs judicial review of final agency decisions. RCW 34.05.070. In reviewing an agency decision, we sit in the same position as the superior court. Darkenwald v. Emp't Sec. Dep't , 183 Wash.2d 237, 244, 350 P.3d 647 (2015) (citing Verizon Nw., Inc. v. Emp't Sec. Dep't , 164 Wash.2d 909, 915, 194 P.3d 255 (2008) ). We review the final agency decision and apply APA standards directly to the record that was before the agency. Id. An agency's action is invalid if the agency interpreted or applied the law erroneously. RCW 34.05.570(3)(d).

¶11 The parties dispute the interpretation of RCW 49.12.265(5), which defines "sick leave or other paid time off" for purposes of the FCA. The meaning of a statute is a question of law that we review de novo. Dep't of Ecology v. Campbell & Gwinn, LLC , 146 Wash.2d 1, 9, 43 P.3d 4 (2002) (citing State v. Breazeale , 144 Wash.2d 829, 837, 31 P.3d 1155 (2001) ).

¶12 Our primary duty in interpreting a statute is to "discern and implement the intent of the legislature." State v. J.P. , 149 Wash.2d 444, 450, 69 P.3d 318 (2003) (citing Nat'l Elec. Contractors Ass'n v. Riveland , 138 Wash.2d 9, 19, 978 P.2d 481 (1999) ). We begin with the statute's plain meaning. Id. We discern plain meaning from the ordinary meaning of the language, related provisions in the statute, and the statutory scheme as a whole, Id. (citing Dep't of Ecology , 146 Wash.2d at 11, 43 P.3d 4 ). A statute is unambiguous where the plain language is susceptible to only one reasonable reading. J.P. , 149 Wash.2d at 450, 69 P.3d 318 (citing State v. Wilson , 125 Wash.2d 212, 217, 883 P.2d 320 (1994) ). We do not accord deference to an agency's interpretation of an unambiguous statute.

Edelman v. State ex rel. Public Dis closure Com'n , 152 Wash.2d 584, 590, 99 P.3d 386 (2004).

¶13 Under the 1988 family care act, RCW 49.12.265 –295, when an employer provides paid time off for an employee's own use, the employee may use that leave to care for an eligible family member. RCW 49.12.270. If more than one type of paid time off is available, the employee may choose which type of "sick leave or other paid time off" to use for family care:

If, under the terms of a collective bargaining agreement or employer policy applicable to an employee, the employee is entitled to sick leave or other paid time off, then an employer shall allow an employee to use any or all of the employee's choice of sick leave or other paid time off to care for ... [an eligible family member].

RCW 49.12.270(1) (emphasis added).

¶14 In 2002, the legislature defined "[s]ick leave or other paid time off" as "time allowed ... to an employee for illness, vacation, and personal holiday." Former RCW 49.12.265(5) (2002). As part of a 2005 amendment, the legislature added a second sentence to this definition. The second sentence adds self-funded disability plans to the definition of " ‘sick leave or other paid time off’ " when an employer does not allow paid time off "for illness." RCW 49.12.265(5). As amended, the definition statute provides that:

[1]" ‘Sick leave or other paid time off’ " means time allowed under the terms of an appropriate state law, collective bargaining agreement, or employer policy, as applicable, to an employee for illness, vacation, and personal holiday . [2] If paid time is not allowed to an employee for illness, "sick leave or other paid time off" also means time allowed under the terms of an appropriate state law, collective bargaining agreement, or employer policy, as applicable, to an employee for disability under a plan, fund, program, or practice that is: (a) Not covered by the employee retirement income security act of 1974, 29 U.S.C. Sec. 1001 et seq. ; and (b) not established or maintained through the purchase of insurance.

RCW 49.12.265(5) (emphasis added).

¶15 The definition statute refers to time "allowed" or "not allowed" to an employee "for illness" in the first and the second sentences, respectively. The parties agree that the term "for illness" has the same meaning in both sentences. But because they disagree on...