Barrueta v. Ralphs Grocery
Filed 8/16/12 Barrueta v. Ralphs Grocery CA2/4
NOT TO BE PUBLISHED IN THE
OFFICIAL REPORTS
California
Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or
relying on opinions not certified for publication or ordered published, except
as specified by rule 8.1115(b). This
opinion has not been certified for publication or ordered published for
purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF
CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION FOUR
MARK BARRUETA,
Plaintiff and Appellant,
v.
RALPHS GROCERY
COMPANY,
Defendant and Respondent.
B233152
(Los Angeles County
Super. Ct. No. BC379200)
APPEAL
from an order of the Superior Court of
County, Richard L. Fruin, Jr., Judge.
Affirmed.
Law
Offices of Joseph M. Herbert, Joseph M. Herbert; Law Offices of Louis H.
Kreuzer II and Louis H. Kreuzer II for Plaintiff and Appellant.
Reed
Smith, Margaret M. Grignon, Remy Kessler, and Anne M. Grignon for Defendant and
Respondent.
>
Putative class
representative Mark Barrueta is one of 250 off-duty or retired peace officers
(ODO’s) who entered into independent contractor engagement agreements with
defendant International Protective Services, Inc., doing business as
International Services, Inc. (ISI), a “private patrol operator” licensed by the
State of California to furnish security guards.
(Bus. & Prof. Code, § 7582.1, subd. (a).) ISI hired the ODO’s specifically to work as
armed security guards at various facilities of defendant Ralphs Grocery Company
(Ralphs) during the “Southern California Supermarket Strike of 2003-2004”
(strike), which lasted from October 2003 to February 2004.
The
complaint alleged that ISI and Ralphs violated the
Code, § 17200 (UCL)) by misclassifying the ODO’s as independent contractors
rather than employees and failing to pay statutorily required overtime
wages. Barrueta moved to certify the
proposed class of ODO’s, but the trial court granted the motion only as to the
claim against ISI. Based on the parties’
conflicting evidence concerning Ralphs’s liability as a joint employer, the
trial court concluded that it was neither feasible nor desirable to litigate
the claim against Ralphs on a classwide basis.
In this appeal from the order denying class certification as to the
claim against Ralphs, we affirm, finding no abuse of discretion or legal
error.
On
October 16, 2007, Barrueta filed a putative class action complaint alleging
that ISI and Ralphs violated the UCL by misclassifying the ODO’s as independent
contractors rather than employees and failing to pay overtime wages in
violation of Labor Code section 510 and Industrial Wage Commission (IWC) Wage
Order No. 4-2001.
name="_ftnref1" title="">[1] The complaint sought
appointment of a receiver, attorney fees under section 1194,
On
April 27, 2009, ISI filed a chapter 11 bankruptcy petition in the United States
Bankruptcy Court for the Central District of California, Case No.
2:09-bk-19847-EC, which triggered an automatic stay of Barrueta’s claim against
ISI. After the bankruptcy court lifted
the automatic stay, Barrueta moved to certify a proposed class consisting of
“[t]hose persons who: 1.) held the same
or equivalent position as Plaintiff Mark Barrueta; 2.) provided services to
Ralphs Grocery Company through [ISI]; 3.) were paid hourly; 4.) were not in
uniform; 5.) were armed; and 6.) performed these services during the 2003-2004
Southern California Grocery Workers Strike.”
>
The trial court certified
the proposed class as to the claim against ISI,
contractor engagement agreements with the ODO’s, the trial court found that as
to ISI, there were common issues of fact and law: “(1) whether ISI’s hiring of off-duty peace
officers as independent contractors violates the Private Security Services Act
(PSSA), Bus. & Professions Code section 7580 et seq.; (2) whether ISI
exercised such control over the off-duty peace officers that they were
misclassified as independent contractors rather than as ISI employees; and (3)
whether the off-duty peace officers, if classified as employees, are entitled
to overtime wages from ISI.”
name="_ftnref4" title="">[4]
The
trial court reached a different conclusion as to Ralphs, which had no direct
employment relationship with ISI’s ODO’s.
Barrueta alleged that Ralphs’s liability for ISI’s misclassification of
the ODO’s as independent contractors and nonpayment of overtime wages was
premised on the joint employment relationship that arose from its control over
their wages, hours, or working conditions. The trial court found, however, that
because individual issues predominated over common issues as to Ralphs’s
exercise of control over wages, hours, or working conditions, a class action
against Ralphs would be neither feasible nor manageable.
Barrueta
contends on appeal that the joint employer issue “is amenable to class
treatment because the evidence used to prove that Ralphs was an employer
. . . is common to all” class members. In light of his contention, we will focus in
the sections below on the evidence and findings relevant to the joint employer
issue.
Supervise the ODO’s in the Performance of Their Strike-Related Duties
Each ODO had some or all of
duties: (1) deter strikers from
interfering with or obstructing the Ralphs distribution centers in Compton,
Glendale, and Riverside; (2) “drive personnel to different locations to view or
respond to possible Strike activities”; and (3) provide security at “individual
Ralphs stores throughout the greater metropolitan area to deter picketing that
might block the store entrances or aisles.”
The
evidence submitted by the parties showed that Ralphs did not train, equip, or supervise the ODO’s in the
performance of their strike-related duties.
According to the trial court’s ruling, “[m]ost of the off-duty peace
officers were assigned to individual Ralphs stores throughout the greater
metropolitan area to deter picketing that might block the store entrances or
aisles. These officers do not appear to
have been given specific duties from ISI other than to provide visible
security. Many of the off-duty officers
were assigned to security duty at more than one Ralphs store, as well as at a
distribution center, over the course of the Strike. The officers apparently drove to their
assigned locations in their own vehicles.
The off-duty peace officers, after some point in time, were told to
check in and to check out with the store managers. The officers, however, submitted their time
sheets (or telephonically reported their hours) to ISI.”
Evidence That Some Store Managers Allowed or Directed Some ODO’s to Perform
Nonsecurity Duties That Ralphs Did Not Authorize
The
declarations submitted in connection with the class certification motion
indicated that some but not all store managers had allowed or directed certain
ODO’s to perform nonsecurity duties that Ralphs did not authorize. The control exerted by the store managers
over the ODO’s performance of nonsecurity duties supplied the primary factual
support for Barrueta’s legal theory that Ralphs was a joint employer of ISI’s
ODO’s and, therefore, was liable for ISI’s nonpayment of overtime wages.
In
his declaration, Barrueta stated that he was assigned to nonsecurity duties and
monitored in his performance of those duties by Ralphs store managers: “While working at the stores, I performed
work that was not related to the strike at the direction of Ralphs store
management. This non-Strike work
included picking up carts in the parking lot, stocking shelves, mopping up
spills, bagging groceries, inventory stock, and performing loss prevention
duties, especially in regard to high-dollar aisles like the meat, liquor, and
cosmetics departments. At the Santa
Barbara store, I was assigned to work on cases concerning forged checks; packed
meat; sorted produce; and unloaded trucks.
I also helped subdue a robber at the Van Nuys store.”
The
trial court found that Barrueta’s declaration was “supported, in varying
degree, by 15 other officers who were assigned store security duty.” “These declarants testify, almost
identically, that they were directed to perform grocery store duties by the
Ralphs store managers. These
declarations also report, almost in unison:
‘For example, the Ralphs store manager asked me to perform loss
prevention duties and follow suspicious people when they came into the store,
and observe for shoplifters.’ [Internal
record reference omitted.] The
plaintiff’s declarations also usually recite some variant of the following
testimony: ‘The Ralphs store manager
also told me to collect grocery carts in the parking lot, bag groceries, stock
shelves with grocery items, clean messes in the store including spills,
inventory and count products unloaded from the trucks, and unload trucks.’ [Internal record reference and fn. omitted.]”
The
trial court found that other ODO’s had different experiences, stating: “The eight declarations submitted by
Ralphs from the off-duty peace officers who were assigned to store duty are
more varied and paint a different picture. . . . The eight declarations report that the store
manager did not assign duties to them and that they did not, at the manager’s
request, perform any grocery store duties.
(Two declarants said they did on occasion collect grocery carts or, for
a few minutes, bag groceries, but out of boredom or to socialize.) The store managers testify that Ralphs told
them that the off-duty peace officers were not to perform grocery store
duties. They said the off-duty officers
were not needed for those tasks as their store was amply staffed during the
Strike.”
The trial court found that
because the ODO’s experiences were so varied, there was no single set of facts
common to the entire class: “The heart
of plaintiff’s case is that Ralphs store managers exercised control over the
off-duty peace officers assigned to store security duty. From the declarations, however, it appears
that the off-duty peace officers had different experiences when assigned to
individual Ralphs stores, depending on which stores and which shifts they had,
that is, depending on which store managers they encountered. Some of the off-duty peace officers,
according to their declarations, were requested to perform non-strike functions
at some stores, while other officers report that such requests were not made to
them. It [is] not disputed that Ralphs’
management did not want the off-duty peace officers to perform non-security
functions—they directed store managers to not assign non-security tasks to the
off-duty security officers. [Internal
record reference omitted.] With respect
to any off-duty peace officers who performed non-security functions, at the
direction of a store manager, the total time they devoted to such tasks, as
distinct from Strike security tasks, is not defined.”
Common Issues Did Not Predominate on the Issue of Joint Employment, the Trial
Court Concluded That a Class Action Against Ralphs Would Not be Manageable
The
trial court found that although the declarations were “broadly in agreement as
to the structure of the relationship among ISI, Ralphs and the off-duty peace
officers during the Ralphs Strike,” they were otherwise “not in agreement. The declarations are in conflict as to the
degree of control that the Ralphs store directors exercised over the off-duty
peace officers once they arrived for security duties at particular Ralphs stores.”
In
light of the conflicting evidence, the
trial court found that common issues did not predominate “because the
individual testimony of the putative class members would be required with
respect to the degree of control that Ralphs exercised over the work performed
by each of the off-duty peace officers.”
“To the extent that some off-duty peace officers performed non-security
functions, the nature of those tasks and the time devoted to them would require
individual testimony from the members of the putative class. This is a significant issue because the
principles of employment law require a determination of the degree of control
the putative employer exercises over the job performance of the putative employee.”
The
trial court concluded that because individualized “testimony from each officer
as to his/her experience at each store (and maybe each shift at each store)”
would be necessary, a class action against Ralphs would be “unmanageable.” It therefore denied the motion to certify a
class against Ralphs.
Barrueta
timely appealed from the order denying class certification. (See Linder
v. Thrifty Oil Co. (2000) 23 Cal.4th 429, 435 [denial of certification to
an entire class is an appealable order].)
Barrueta
states that according to Martinez v.
Combs (2010) 49 Cal.4th 35 (Martinez),
the term “employment” in state wage and hour cases means: “(a) to exercise control over the wages,
hours or working conditions, or (b)
to suffer or permit to work, or (c)
to engage, thereby creating a common law employment relationship.” (Id. at
p. 64.) Applying Martinez’s definition of employment to this case, Barrueta contends
the denial of class certification was an abuse of discretion because
Ralphs: (1) controlled the ODO’s wages,
hours, or working conditions; (2) suffered or permitted work by the ODO’s; and
(3) engaged the ODO’s in a common law employment relationship. He also argues that: (4) the trial court applied an incorrect
legal standard; (5) class resolution is a superior method; and (6) certain
evidence was erroneously excluded. For
the reasons that follow, we conclude the contentions lack merit.
I. Standard of Review
The California Supreme Court recently discussed the
requirements for class certification in Brinker
Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004, 1021-1022, which
we quote at length because of its applicability to this case:
“Originally
creatures of equity, class actions have been statutorily embraced by the
Legislature whenever ‘the question [in a case] is one of a common or general
interest, of many persons, or when the parties are numerous, and it is
impracticable to bring them all before the court . . . .’ (Code Civ. Proc., § 382; see Fireside Bank
v. Superior Court (2007) 40 Cal.4th 1069, 1078; City of San Jose v.
Superior Court (1974) 12 Cal.3d 447, 458.)
Drawing on the language of Code of Civil Procedure section 382 and
federal precedent, we have articulated clear requirements for the certification
of a class. The party advocating class
treatment must demonstrate the existence of an ascertainable and sufficiently
numerous class, a well-defined community of interest, and substantial benefits
from certification that render proceeding as a class superior to the
alternatives. (Code Civ. Proc., § 382; Fireside
Bank, at p. 1089; Linder
v. Thrifty Oil Co.[, supra,]
23 Cal.4th [at p.] 435; City of San Jose, at p. 459.) ‘In turn,
the “community of interest requirement embodies three factors: (1) predominant common questions of law or
fact; (2) class representatives with claims or defenses typical of the class;
and (3) class representatives who can adequately represent the class.”’ (Fireside Bank, at p. 1089, quoting Richmond v. Dart Industries, Inc. (1981) 29 Cal.3d 462,
470.)
“Here, only a single element of
class suitability, and a single aspect of the trial court’s certification
decision, is in dispute: whether
individual questions or questions of common or general interest predominate. The ‘ultimate question’ the element of
predominance presents is whether ‘the issues which may be jointly tried, when
compared with those requiring separate adjudication, are so numerous or
substantial that the maintenance of a class action would be advantageous to the
judicial process and to the litigants.’
(Collins v. Rocha (1972) 7 Cal.3d 232, 238; accord, Sav-On
Drug Stores, Inc. v. Superior
Court (2004) 34 Cal.4th 319, 326.)
The answer hinges on
‘whether
advanced by the proponents of certification is, as an analytical matter, likely
to prove amenable to class treatment.’ (Sav-On, at p. 327.) A court must examine the allegations of the
complaint and supporting declarations (ibid.) and consider whether the
legal and factual issues they present are such that their resolution in a
single class proceeding would be both desirable and feasible. [Fn. omitted.] ‘As a general rule if the defendant’s
liability can be determined by facts common to all members of the class, a
class will be certified even if the members must individually prove their
damages.’ (Hicks v. Kaufman &
Broad Home Corp. (2001) 89 Cal.App.4th 908, 916; accord, Knapp v.
AT&T Wireless Services,
Inc. (2011) 195 Cal.App.4th 932, 941.)
“On review of a class certification
order, an appellate court’s inquiry is narrowly circumscribed. ‘The decision to certify a class rests
squarely within the discretion of the trial court, and we afford that decision
great deference on appeal, reversing only for a manifest abuse of discretion: “Because trial courts are ideally situated to
evaluate the efficiencies and practicalities of permitting group action, they
are afforded great discretion in granting or denying certification.” [Citation.]
A certification order generally will not be disturbed unless (1) it is
unsupported by substantial evidence, (2) it rests on improper criteria, or (3)
it rests on erroneous legal assumptions.
[Citations.]’ (Fireside Bank
v. Superior Court, supra,
40 Cal.4th at p. 1089; see also Hamwi v. Citinational-Buckeye Inv. Co.
(1977) 72 Cal.App.3d 462, 472 [‘So long as [the trial] court applies proper
criteria and its action is founded on a rational basis, its ruling must be
upheld.’].)”
II. Martinez’s
Definition of Employment
arose from a summary judgment motion rather than a class certification
motion. It is similar, however, in that
it also involved the issue of joint employment.
The dispute arose as a statutory wage and hour violation claim brought
by seasonal agricultural workers against their bankrupt employer, defendant
Munoz, and the defendant produce merchants who had ceased marketing Munoz’s
strawberries. Given that the produce
merchants had no direct employment relationship with Munoz’s workers, their
liability for the workers’ unpaid wages turned on the issue of joint
employment. The produce merchants moved
for summary judgment on the ground that the undisputed evidence showed, as a
matter of law, that they did not jointly employ Munoz’s workers. The trial court granted the produce
merchants’ motion for summary judgment and entered judgment in their favor,
which was affirmed.
Prior
to discussing the merits of the produce merchants’ summary judgment motion, the
Supreme Court analyzed the term “employment” for the first time in the context
of California wage and hour violation cases.
It explained that an employee’s suit under section 1194 for unpaid
minimum wages is actually a suit “to enforce the applicable wage order. This is because the ‘legal minimum wage’
recoverable under section 1194 is ‘[t]he
minimum wage . . . fixed by the commission’ (§ 1197) in the
applicable wage order, even if that order merely incorporates the amount
currently set by statute, and because employers and employees become subject to
the minimum wage only through the applicable wage order and according to its
terms (§ 1197 . . .).” (
The IWC’s definition of “employer” applies to section 1194 cases and
“incorporates the common law definition as
one alternative. As defined in the
wage orders, ‘“[e]mployer” means any person . . . who
. . . employs or
exercises control over the wages, hours, or working conditions of any person,’
and ‘“[e]mploy” means to engage,
suffer, or permit to work.’ (Wage Order
No. 14[-2001], Cal. Code Regs., tit. 8,
§ 11140, subd. 2(C), (F), italics added.)
The verbs ‘to suffer’ and ‘to permit,’ as we have seen, are terms of art
in employment law. [Citation.] In contrast, the verb ‘to engage’ has no
other apparent meaning in the present context than its plain, ordinary sense of
‘to employ,’ that is, to create a common law employment relationship. [Fn. omitted.]” (Martinez,
supra, at p. 64.)
Turning
to the merits of the produce merchants’ summary judgment motion, the Supreme
Court evaluated the evidence in the context of the exercise of control and
suffer or permit to work tests, and found no
of Control
The
Supreme Court explained that in a joint employer situation, the exercise of
“control over how services are performed is an important, perhaps even the
principal, test for the existence of an employment relationship.” (Martinez,
supra, 49 Cal.4th at p. 76.) It stated that “one of the reasons the IWC
defined ‘employer’ in terms of exercising control was to reach situations in
which multiple entities control different aspects of the employment
relationship. This occurs, for example,
when one entity (such as a temporary employment agency) hires and pays a
worker, and another entity supervises the work.
[Citation.] Supervision of the
work, in the specific sense of exercising control over how services are
performed, is properly viewed as one of the ‘working conditions’ mentioned in
the wage order. To read the wage order
in this way makes it consistent with other areas of the law, in which control
over how services are performed is an important, perhaps even the principal,
test for the existence of an employment relationship. [Citations.]”
(Ibid.)
In
applying the exercise of control test to the evidence, the Supreme Court found
that the undisputed facts showed “that Munoz alone controlled plaintiffs’
wages, hours and working conditions.” (
Accordingly, the court held that the produce merchants were not liable,
as a matter of law, as joint employers under the exercise of control test for
the wages owed to Munoz’s employees.
or Permit to Work
The
Supreme Court explained that the “suffer or permit to work” test of employment
rests “‘upon principles wholly distinct from those relating to master and
servant.’” (Martinez, supra, 49
Cal.4th at p. 69.) “[U]nder the ‘suffer or permit’ standard,” the
“basis of liability is the defendant’s knowledge of and failure to prevent the work from occurring. [Citations.]”
(Id. at p. 70.)
Historically,
the phrase “to suffer or permit to work” comes from “the language of early
20th-century statutes prohibiting child labor.
[Citation.] Statutes so phrased
were generally understood to impose liability on the proprietor of a business
who knew child labor was occurring in the enterprise but failed to prevent it,
despite the absence of a common law employment relationship. As courts had explained, the language meant
‘that [the proprietor] shall not employ by
contract, nor shall he permit by
acquiescence, nor suffer by a failure
to hinder.’ [Citation.] The language thus ‘cast[] a duty upon the
owner or proprietor to prevent the unlawful condition, and the liability
rest[ed] upon principles wholly distinct from those relating to master and
servant. The basis of liability is the owner’s failure to perform the duty of
seeing to it that the prohibited condition does not exist.’ (People
v. Sheffield Farms-Slawson-Decker Co. (N.Y.App.Div. 1917) 180 A.D. 615 [167
N.Y.S. 958, 961], italics added, affd. (1918) 225 N.Y. 25 [121 N.E. 474, 477]
[‘the omission to discover and prevent was a sufferance of the work’].)” (Martinez,
supra, 49 Cal.4th at p. 69.)
The
court explained that the “suffer or permit to work” standard prohibits
proprietors from knowingly allowing persons to work for less than minimum wage,
or failing to prevent such work while having the power to do so. As stated in Martinez: “We see no reason
to refrain from giving the IWC’s definition of ‘employ’ its historical
meaning. That meaning was well
established when the IWC first used the phrase ‘suffer, or permit’ to define
employment, and no reason exists to believe the IWC intended another. Furthermore, the historical meaning continues
to be highly relevant today: A
proprietor who knows that persons are working in his or her business without
having been formally hired, or while being paid less than the minimum wage,
clearly suffers or permits that work by failing to prevent it, while having the
power to do so.” (49 Cal.4th at p.
69.) “[A]s we have explained, the basis
of liability is the defendant’s knowledge of and failure to prevent the work from occurring. [Citations.]”
(Id. at p. 70.)
The
produce workers in Martinez argued
that the produce merchants were liable for their unpaid wages as joint
employers because of their knowledge and failure to prevent the work from
occurring. Based on the undisputed
evidence, however, the Supreme Court found that the merchants did not suffer or
permit plaintiffs to work because the merchants did not have “the power to
prevent plaintiffs from working. Munoz
and his foremen had the exclusive power to hire and fire his workers, to set
their wages and hours, and to tell them when and where to report to work. Perhaps [the merchants], by ceasing to buy
strawberries, might as a practical matter have forced Munoz to lay off workers
or to divert their labor to other projects, such as harvesting berries for the
other defendant, for Frozsun [fn. omitted], or for Ramirez Brothers. But any substantial purchaser of commodities
might force similar choices on a supplier by withdrawing its business. Such a business relationship, standing alone,
does not transform the purchaser into the employer of the supplier’s
workforce.” (Martinez, supra, 49
Cal.4th at p. 70.) Accordingly, the
court held that the produce merchants were not liable, as a matter of law, as
joint employers under the suffer or permit to work test for the wages owed to
Munoz’s employees.
Failed to Establish that Common Issues Predominate Concerning the Issue of
Joint Employment
In
this case, the trial court denied class certification because, given the
diverse range of experiences of each ODO, individual testimony would be
required from each ODO on the joint employment issue. The court stated that because individualized “testimony
from each officer as to his/her experience at each store (and maybe each shift
at each store)” was required, a class action trial would be “unmanageable.”
Barrueta argues on appeal
that common issues predominate concerning Ralphs’s exercise of control over
wages, hours, or working conditions. We
conclude, however, that the record supports the trial court’s finding to the
contrary.
In
analyzing this contention, “‘we must consider
whether the record contains substantial evidence to support the trial court’s
predominance finding, as a certification ruling not supported by substantial
evidence cannot stand.’ (Lockheed [Martin Corp. v. Superior Court (2003)]
29 Cal.4th [1096,] 1106.) But, ‘[w]here
a certification order turns on inferences to be drawn from the facts, “‘the
reviewing court has no authority to substitute its decision for that of the
trial court.’”’ (Massachusetts Mutual
Life Ins. Co. v. Superior Court (2002) 97 Cal.App.4th 1282, 1287; accord, Walker
v. Superior Court (1991) 53 Cal.3d 257, 272.)” (Sav-On
Drug Stores, Inc. v. Superior Court,
supra, 34 Cal.4th at p. 328.)
The
appellate court may not reweigh the evidence, for even if “another trial judge
considering the matter in the first instance would have allowed class
treatment, . . . that does not merit reversal.” (Ali v.
U.S.A. Cab Ltd. (2009) 176 Cal.App.4th 1333, 1351.) Where the record presents
facts on which reasonable minds may differ, there is no
basis to find an abuse of discretion. (People
v. Moya (1986) 184 Cal.App.3d 1307, 1313, fn. 2.)
A. Control Over Wages
Barrueta
contends that because Ralphs controlled the wages paid by ISI, the trial court
abused its discretion in concluding that common issues would not predominate
over individual issues. The issue we
must consider is whether the record contains substantial evidence to support
the contrary finding of the trial court.
If it does, there is no basis to find an abuse of discretion. (People
v. Moya, supra, 184 Cal.App.3d at
p. 1313, fn. 2.)
In an
attempt to establish an abuse of discretion, Barrueta refers to evidence that
“Ralphs Security Department began confirming that the ODOs were actually
providing the security for which ISI was charging Ralphs and for which Ralphs
was paying.” Based on this evidence,
Barrueta concludes that “Ralphs paid for shifts or by the hour, and did not pay
ISI as an aggregate contract,” and “Ralphs paid the wages after assuring itself
that the shifts were worked, but ran the paychecks through ISI.”
The
difficulty we perceive with the statement, “Ralphs paid for shifts or by the
hour,” is that it is based on speculation and therefore cannot amount to
substantial evidence that common issues of fact will predominate in a class
action trial. In order to establish a
commonality of issues, the moving party must provide substantial evidence that
common facts will predominate. Evidence
that Ralphs was “confirming that the ODOs were actually providing the security
for which ISI was charging and for which Ralphs was paying” does not amount to
substantial evidence that common facts will predominate because Ralphs could
have had any number of reasons to confirm that it was receiving the benefit of
its bargain. The same holds true for the
assertion that “Ralphs paid the wages . . . but ran the
paychecks through ISI.”
The
most compelling support, in our view, for the trial court’s determination that
common issues of fact will not predominate is the lack of any evidence that
Ralphs had the authority to negotiate and set the rate of pay. (See Futrell
v. Payday California, Inc. (2010)
190 Cal.App.4th 1419, 1432 [control over wages exists where a person has power
or authority to negotiate and set an employee’s rate of pay].) This lack of evidence, coupled with the
existence of evidence on which reasonable minds may differ, demonstrate there
was no abuse of discretion as to this issue.
B. Control Over Hours
Barrueta
contends that because Ralphs controlled the hours that the ODO’s worked, the trial court abused its
discretion in concluding that common issues do not predominate. In support of this assertion, he relies on
the fact that “Ralphs informed ISI where and when it needed ODOs and it was up
to ISI to arrange for ODOs to be present and available for work at the location
where Ralphs determined it needed security.”
He also relies on evidence that the ODO’s were required to check in and
out with Ralphs store directors.
In
analyzing this contention, we note that Ralphs did not assign or monitor the hours worked by
any individual ODO, but left it to ISI to assign the ODO’s to specific
locations and shifts in accordance with Ralphs’s needs. This reasonably suggests that ISI, rather
than Ralphs, controlled the ODO’s hours.
Assuming
there is some evidence from which we may infer that Ralphs controlled the ODO’s
hours, there is other evidence from which we may infer that ISI controlled the
ODO’s hours. Given that we may not
reweigh the evidence and the record presents facts on
which reasonable minds may differ, there is no basis to find an
abuse of discretion. (Ali v. U.S.A. Cab Ltd., supra,
176 Cal.App.4th at p. 1351; People v. Moya, supra, 184
Cal.App.3d at p. 1313, fn. 2.)
Over Working Conditions
Barrueta
contends that because Ralphs controlled the ODO’s working conditions, the trial court abused its
discretion in concluding that common issues do not predominate. In support of this assertion, he states that
“Ralphs had the Security Guards check in and out with store directors, telling
some of the Security Guards where to specifically position themselves to
observe the strikers, and had some of the Security Guards bag groceries and
collect carts in the parking lot.”
The
trial court found, however, that “[t]he declarations are in conflict as to the
degree of control that the Ralphs store directors exercised over the off-duty
peace officers once they arrived for security duties at particular Ralphs
stores.” It stated, “To the extent that
some off-duty peace officers performed non-security functions, the nature of
those tasks and the time devoted to them would require individual testimony
from the members of the putative class.”
In
light of the conflicting evidence on which reasonable
minds may differ, we find no abuse of discretion as to this
issue. (Ali v. U.S.A.
Cab Ltd., supra, 176 Cal.App.4th
at p. 1351; People v. Moya, supra, 184
Cal.App.3d at p. 1313, fn. 2.)
D. Suffer or
Permit to Work
As previously discussed, the “suffer
or permit to work” definition of employment applies where a proprietor
knowingly allows persons to work in his or her
business for less than minimum wage or permits such “work by failing to
prevent it, while
having the power to do so.” (
“[T]he basis of liability is the defendant’s knowledge of and
occurring. [Citations.]” (Id. at
p. 70.)
Based
on our review of the record, we conclude that the “suffer or permit to work” test
of employment was not sufficiently developed to provide a ground for reversal
on appeal. Although Barrueta mentioned
the test below, he did so only in passing.
He did not identify any specific evidence to show that common issues of
fact would predominate under this test.
Although
the record is far from clear, it is possible that Barrueta was advancing a
theory of commonality based on the “suffer or permit to work” definition of
employment when he argued that both ISI and Ralphs were responsible for
complying with wage and hour laws. If
that is true, we conclude that he offered no support for this theory of
commonality other than his counsel’s bare assertion that Ralphs was a joint
employer. Counsel’s unsupported
assertion prompted the trial court to state, “Well, wait a minute, now. That’s the assumption, that [Ralphs] employed
them. [Ralphs] paid for the hours that
they worked, or at least [Ralphs] paid I.S.I. to provide security personnel for
particular stores for particular hours.
But that doesn’t mean [Ralphs] employed them. I mean, if you assume the conclusion, then,
of course, you’re right.” The trial
court’s remark was followed by Barrueta’s counsel’s concession that he was
assuming the conclusion: “Our position
is [Ralphs] hired them, that they’re their employee and they hired — and I’m,
you know, assuming the conclusion again.
But they — and for this motion . . . this can be
determined on a class-wide basis because they gave them hours — they were paid
on an hourly basis.”
Barrueta
argues on appeal that by hiring ISI’s services, Ralphs became a joint employer
under the “suffer or permit to work” definition of employment. He states:
“There is no question that Ralphs suffered and/or permitted the Security
Guards to work for it because Ralphs expressly sought the Security Guards to
protect its personnel and property.
Consequently, this issue can be answered on a class-wide basis and is
not subject to individual determination.”
Barrueta
offers no legal support for his broad assertion that by hiring ISI’s services,
Ralphs became a joint employer and is therefore liable for ISI’s statutory wage
and hour violations. We have serious
reservations as to whether the law imposes joint employer liability on the
hirer of a security guard contractor in all circumstances.
In
any event, the test under Martinez is
not whether Ralphs contracted for security guard services from ISI, but whether
it knowingly permitted or failed to prevent work in violation of statutory
overtime wage laws when it had the ability to do so. In light of Barrueta’s failure to provide any
evidence on this point, he has failed to establish that the trial court abused
its discretion in finding a lack of commonality.
Engage in a Common Law Employment Relationship
The
final test of employment is to engage, thereby creating a common law employment
relationship. Barrueta contends that the
“essence of the common law test of employment is in the ‘control of details.’ (Futrell
v. Payday California, Inc.[,
1434.)” He argues on appeal that several
factors of the common law test are susceptible to common proof, including: (1) whether Ralphs supplied the instrumentalities,
tools, and place of work; (2) the length of time of services and method of
payment; (3) whether the work is part of Ralphs’s business; and
(4) whether the ODO’s were engaged in a distinct occupation or business.
Ralphs
argues that Barrueta forfeited this issue on appeal by failing to raise it
below. The record shows that Barrueta
mentioned the common law test at the class certification hearing, but only in
passing and with no explanation of its application on a classwide basis to a
common set of facts. The record does not
indicate that Barrueta made separate arguments of commonality under the primary
test of employment based on control over wages, hours, and working conditions (
control of details (Futrell v. Payday
California, Inc.,
A
trial court’s “‘“[d]iscretion is abused whenever, in its exercise, the court
exceeds the bounds of reason, all of the circumstances before it being
considered. The burden is on the party
complaining to establish an abuse of discretion, and unless a clear case of
abuse is shown and unless there has been a miscarriage of justice a reviewing
court will not substitute its opinion and thereby divest the trial court of its
discretionary power.”’ [Citations.]” (Blue
Cross of California, Inc.
1237, 1258.) Given that the trial court
was not asked to determine whether common issues would predominate under a
common law theory of joint employment, we conclude that Barrueta is incapable
of establishing an abuse of discretion.
IV. The Trial Court Did Not Apply an
Erroneous Standard
Barrueta contends that the “trial court applied an
incorrect standard concerning control” by referring to Vernon v. State of California (2004) 116 Cal.App.4th 114 (
employment discrimination in violation of the Fair Employment and Housing
Act. (Gov. Code, § 12900 et seq.) Referring to the order denying class certification,
Barrueta states that “[t]he trial court noted with approval the holding in
organization asserts must be significant [citation], and there must be a
‘sufficient indicia of an interrelationship . . . to justify the
belief on the part of an aggrieved employee that the [alleged co-employer] is
jointly responsible for the acts of the immediate employer.’”’”
We
disagree that the trial court applied an erroneous standard. As we previously discussed, the trial court
properly exercised its discretion in concluding that the evidence failed to
establish a commonality of issues. The
trial court’s reference to Vernon does
not undermine that finding. Regardless
of Vernon’s applicability to wage and
hour cases, there was no abuse of discretion or legal error that would warrant
a reversal of the denial of class certification. Regardless of Vernon’s relevance or lack of relevance to wage and hour cases, the
trial court’s factual finding of a lack of commonality of issues is supported
by substantial evidence.
V. Superiority of Class Resolution
In evaluating
whether a class action is superior to individual actions, the trial court
considers the interest of each member in controlling his or her own case
personally, the difficulties that are likely to be encountered in managing a
class action, the nature and extent of any individual litigation already in
progress, and the desirability of consolidating all claims in a single
action. (Basurco v. 21st Century Ins. Co. (2003) 108 Cal.App.4th 110,
121.) In this case, the trial court
concluded that a class action would not be superior to separate actions because
individual testimony will be required to establish Ralphs’s liability, if any,
to each ODO as a joint employer. For all
of the reasons previously discussed, we conclude that the trial court did not abuse
its discretion in making this determination, which is supported by substantial
evidence.
VI. Exclusion of Evidence
Ralphs
objected to several types of statements that were commonly included in
Barrueta’s ODO declarations in support of the class certification motion: (1) the ODO believed he or she was working
for Ralphs; (2) this belief was based on the directions given by Ralphs store
managers; (3) Ralphs directed the ODO to report to his or her assignment, which
was made by Ralphs; and (4) the ODO took directions from Ralphs employees. The trial court sustained Ralphs’s objections
to these types of statements on a number of grounds including lack of
foundation, improper opinion, and lack of personal knowledge. Barrueta contends on appeal that the objections
should not have been sustained on any of these grounds.
In
considering this contention, we must bear in mind that the denial of class
certification turned on the lack of common issues and not on the merits (or
lack thereof) of the joint employer allegation.
Even if we assume for the sake of argument that the disputed statements
were admissible, Barrueta could not have been prejudiced by their exclusion
because the merits of his joint employer allegation were not being
decided. The admission of the excluded
statements would have added nothing to Barrueta’s theory of commonality and
subtracted nothing from the opposing party’s evidence of a lack of
commonality. “The erroneous
record, it is reasonably probable that a result more favorable to the appealing
party would have been reached in the absence of the error. [Citation.]”
(Brown v. County of Los Angeles (2012)
203 Cal.App.4th 1529, 1550.) We conclude
that because Barrueta is incapable of establishing prejudice, the contention
lacks merit.
The order denying class certification is
affirmed. Ralphs is awarded its costs on
appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
SUZUKAWA,
J.
We concur:
EPSTEIN, P.
J.
WILLHITE,
J.
name="_ftn1" title="">[1] Unless
otherwise indicated, all further statutory references are to the Labor Code.
Section 510, subdivision (a)
provides in relevant part: “Eight hours
of labor constitutes a day’s work. Any
work in excess of eight hours in one workday and any work in excess of 40 hours
in any one workweek and the first eight hours worked on the seventh day of work
in any one workweek shall be compensated at the rate of no less than one and
one-half times the regular rate of pay for an employee. Any work in excess of 12 hours in one day
shall be compensated at the rate of no less than twice the regular rate of pay
for an employee. In addition, any work
in excess of eight hours on any seventh day of a workweek shall be compensated
at the rate of no less than twice the regular rate of pay of an employee. Nothing in this section requires an employer
to combine more than one rate of overtime compensation in order to calculate
the amount to be paid to an employee for any hour of overtime work.”
IWC Wage Order No. 4-2001 regulates the wages,
hours, and working conditions in professional, technical, clerical, mechanical,
and similar occupations, including security guards. It requires the payment of overtime wages of
one and one-half times the employee’s regular rate of pay for all hours worked
in excess of eight hours up to and including 12 hours in any workday, and for
the first eight hours worked on the seventh consecutive day of work in a
workweek. It also requires the payment
of double the employee’s regular rate of pay for all hours worked in excess of
12 hours in any workday and for all hours worked in excess of eight hours on
the seventh consecutive day of work in a workweek.
name="_ftn2" title="">[2] Section
1194, subdivision (a) provides: “Notwithstanding
any agreement to work for a lesser wage, any employee receiving less than the
legal minimum wage or the legal overtime compensation applicable to the
employee is entitled to recover in a civil action the unpaid balance of the
full amount of this minimum wage or overtime compensation, including interest
thereon, reasonable attorney’s fees, and costs of suit.”
