Tentative Ruling

Judge James F. Rigali
Department 2 SM-Cook
312-C East Cook Street P.O. Box 5369 Santa Maria, CA 93456-5369

CIVIL LAW & MOTION
Alcala v. QE2 Systems, Inc., et al.
Case No: 17CV04847
Hearing Date: Tue Dec 10, 2019 8:30

Nature of Proceedings: Summary Adjudication (2)

On October 18, 2017, plaintiff Roseanna Alcala (plaintiff) filed a first amended class action complaint against defendants QE2 Systems, Inc. and Laurus College, LLC (defendants), advancing nine (9) wage and hour causes of action, as follows: 1) failure to pay wages; 2) failure to pay overtime and double time; 3) failure to provide meal periods; 4) failure to provide rest periods; 5) waiting time penalties; 6) failure to keep and provide accurate wage statements; 7) failure to reimburse business expenses; 8) unfair business practices; and 9) violation of the California Private Attorney General Act (PAGA).[1] Defendants own and operate a private post-secondary education institution. According to the operative pleading, plaintiff and the proposed class were employed by defendants within 4 years of the filing of the complaint as faculty, instructors, and/or teachers, and were treated as exempt employees, and thus deemed not subject to various Labor Code and IWC wage order provisions, per Industrial and Welfare Commission (IWC) wage order No. 4-2001. Plaintiff taught on-line courses from her home in Orange County. Plaintiff contends that she and the proposed class are not exempt from California’s wage and hour laws. Defendants filed a joint answer on November 17, 2018. Advanced as the 17th affirmative defense is defendants’ contention that the lawsuit is barred because plaintiff is a “not a non-exempt employee” (i.e., plaintiff and all proposed class members are exempt employees under the applicable Labor Code and IWC wage orders). The class has not been certified.

The parties have filed cross motions for summary adjudication, asking the court to answer the following question: Under IWC Wage Order No. 4-2001 (8 Cal. Code of Reg., § 11040) (hereafter, section 11040 or Wage Order No. 4-2001), must a teacher/instructor/faculty member of an accredited college or university also be certified or licensed under California as a condition precedent to the professional exemption? Defendants contend instructors do not need to be certified to be considered exempt, while plaintiff contends that to be exempt, the instructor must both teach at an accredited college and be state licensed. Both parties concede that resolution of this issue will not dispose of the lawsuit in aggregate or any cause of action or affirmative defense in particular.[2] The motions are therefore made pursuant to Code of Civil Procedure section 437c, subdivision (t), which provides that notwithstanding subdivision (f)(1) [summary adjudication ”shall be granted only it if completely disposes of a cause of action, an affirmative defense, a claim for damages, or an issue of duty”], “a party may move for summary adjudication of a legal issue or claim for damages other than for punitive damages that does not completely dispose of a cause of action, and affirmative defense, or issue of duty . . . .” The parties have satisfied the requirements under this provision, as they submitted a joint stipulation, articulated the issue to be adjudicated, and submitted declarations to the effect that both motions will further the interest of judicial economy. (Code Civ. Proc., § 437c, subd. (t)(1(A)(i) and (ii)); Exhibit D of plaintiff’s exhibits [joint stipulation from both parties]; for plaintiff, Shane Stafford’s declaration, ¶ 7.) ) This court previously approved the motion.

The court heard oral argument on September 26, 2019, and continued the matter to today’s hearing (December 10, 2019) in order to consider and address arguments advanced at the oral argument.

A) Procedural Deficiencies

Before addressing the merits, some preliminary observations are appropriate. As noted, there are competing motions for summary adjudication, a procedure not troubling or cumbersome as the issue before the court is the same in both motions. The problem, however, is that both parties submit issues of undisputed fact in their separate statements that go far beyond what is necessary to determine the discrete issue advanced per Code of Civil Procedure section 437c, subdivision (t). For example, plaintiff has submitted a separate statement with nine (9) issues of undisputed fact; defendants dispute Issues Nos. 4 to 8, and then have submitted their own issues of undisputed fact (Nos. 1 to 8), to which plaintiff has now responded. Defendants admit the impropriety, but justify their actions out of an “abundance of caution[.]” Both parties submitted a joint declaration for purposes of Code of Civil Procedure section 437c, subdivision (t), in which they stipulated that the court “shall be permitted to adjudicate disputed issues of material facts regarding the Issue [the court is asked to determine] for purposes of ruling on the motions for summary adjudication, to the extent any exist, and the Court may resolve disputed facts and issues ruling without live testimony . . . .” To complicate matters a tad further, the parties submitted a Joint Statement of Facts,” although those “facts” seem pedestrian and largely irrelevant to resolution of issue submitted. (See Exhibit E of Declaration of Shane Stafford.)

The court will overlook this factual helter-skelter, and for purposes of framing the discrete legal issue before it, will assume the following facts are undisputed: 1) plaintiff was employed by defendants as an online instructor sometime during the proposed class period; 2) defendants deemed plaintiff (and similarly situated instructors) as “exempt” employees per section 11040, subdivision 1(A)(3)(a) [detailing the professional exemption at issue]; and 3) plaintiff (and those potentially part of the potential class) were not licensed as instructors by the state of California. In do this the court emphasizes that it is not determining any of these facts conclusively; they are assumed only for purposes of the summary adjudication motion. All other undisputed and disputed facts are deemed tangentially relevant to the immediate task at hand. This predicate seems essential to ensure the court’s determination is not advisory and otherwise properly falls within the strictures of Code of Civil Procedure section 437c, subdivision (t).) (See, e.g., AHMC Healthcare, Inc. v. Superior Court (2018) 24 Cal.App.5th 1014, 1017, fn. 2.)

Plaintiff filed a reply in support of her summary adjudication motion on September 17, 2019. Attached to the reply are second declarations from Shane Stafford and plaintiff Roseanna Alcala; Mr. Stafford’s declaration includes Laurus College, LLC’s discovery responses to special interrogatories (set one), as well as Exhibit A attached to those responses. The court will not consider this new evidence, for three reasons. First, plaintiff fails to marshal the evidence in a separate statement, which violates the “Golden Rule” of summary judgment. (See, e.g., Hernandez v. Enterprise Rent-A-Car Co. of San Francisco (2019) 37 Cal.App.5th 187, ,207, fn. 1 [the “Golden Rule” of summary judgment and summary adjudication is that “ ‘if it is not set forth in the separate statement, it does not exist’ ” (citations omitted.)].) Additionally, even if the court has discretion to consider the new evidence outside the separate statement vehicle, any new evidence can only be considered as long as the party opposing the motion for summary adjudication has notice and an opportunity to respond to the new material. (Plenger v. Alza Corp. (1992) 11 Cal.App.4th 349, 362, fn. 8.) Defendants have not had this opportunity. Finally, a continuance is unnecessary because the new evidence has no meaningful impact on the limited and focused issue the court is asked to decide under Code of Civil Procedure section 437c, subdivision (t)

Finally, on September 17, 2019, plaintiff filed a document entitled “Plaintiff’s Objection to Defendants’ Separate Statement in Support of Opposition to Plaintiff[‘s]. . . Motion for Summary Adjudication.” It is not clear why this document is styled as an “Objection,” for in reality it is a response separate statement to defendants’ eight (8) issues of undisputed material fact. Neither the statutory scheme nor the rules of court contemplate a response separate statement in this fashion. (See Nazir v. United Airlines, Inc. (2009) 178 Cal.App.4th 243, 252 [there is no provision in the statute for a reply separate statement].) Of course, the authorities do not expressly preclude such a response, and where useful, the court may consider it. That being said, both defendants’ opposition separate statement and plaintiff’s reply separate statement do not help the court resolve the issue to be decided by the court, as otherwise requested by the parties.

B) Evidentiary Objections

With Part A of this order in mind, the court overrules defendants’ two (2) objections to plaintiff Roseanna Alcala’s original (first) declaration, as the statements at issue are relevant, not ambiguous, and, important for establishing that she was not licensed by California and deemed exempt by defendants under Wage Order No. 4-2001.

The court also overrules plaintiff’s objection to paragraph 9 of Mr. Shane Stafford’s declaration, as he is simply recounting the contents of Exhibit F attached to the declaration, which is a 13-page bulletin issued by the “State of California Commission on Teach Credentialing” and detailing the “Designated Subjects Career Technical Education Teaching Credential,” the admissibility of which is not itself challenged by plaintiff. The court overrules plaintiff’s “evidentiary” challenge to Issue No. 2 in defendants’ separate statement submitted in support of their motion for summary adjudication. An undisputed issue of fact in a separate statement is neither evidence nor a judicial admission. (Myers v. Trendwest (2009) 178 Cal.App.4th 735, 747.)

Plaintiff advances eighteen (18) evidentiary challenges to the declaration of Ms. Anne Hipshman, a retained (attorney) expert witness who previously worked for the U.S. Department of Labor, Wage & Hour Division as a Compliance Officer, and as Staff Counsel for the California Division of Labor Standards Enforcement (DLSE) for the California Department of Industrial Relations The court sustains plaintiff’s evidentiary objection to Paragraph 9 of Ms. Hipshman’s declaration, as well as the objection to Exhibit 2 attached to her declaration. Ms. Hipshman in her declaration directly quotes verbatim from the contents of Exhibit 2, and to the extent the quotation is offered for the truth of the matter asserted, without any basis to admit the handwritten document contained in Exhibit 2, such as a business record, it is inadmissible following People v. Sanchez (2016) 63 Cal.4th 665 and progeny.

The court overrules the remaining 16 evidentiary objections. In paragraph 11 of her declaration (page 5, lines 24-to 26), Ms. Hipshman references a letter from H. Thomas Cadell, counsel for the Department of Industrial Relations, Division of Labor Standards Enforcement, issued January 17, 2003 (a DLSE letter). DLSE letters “reflect the type of experience and considered judgment that may properly inform” a court’s judgment. (Yamaha Corp. of America v. State Bd. of Equalization (1998) 19 Cal. 4th 1, 14.) The court can – and does – take judicial notice of this letter, particularly as it is referenced in plaintiff’s motion, at page 10. (Bains v. Department of Industrial Relations (2016) 244 Cal.App.4th 1120, 1132, and fn. 7 [DLSE opinion letters may provide useful–but non-binding–guidance for interpreting wage orders].)

The court also overrules all objections to the extent Ms. Hipshman declaration is based on her personal knowledge (personal review of archived material, for example). While she does declare in the alternative that her declaration is based on information and belief were appropriate, she predominately relies on her personal knowledge and her expertise, which makes the declaration distinguishable from the declaration at issue in Lopez v. University Partners (1997) 54 Cal.App.4th 1117, 1124-1125. In fact, all of the remaining challenged paragraphs involve either her personal knowledge (based on personal review of certain material) from her former employer and/or stem from the nature of her expertise working with wage and hour laws and orders and enforcement interpretations from the DLSE, which are useful (albeit not dispositive) in resolving the legal issue before the court. She can recount in general all background information that is relevant, including paragraphs 7, 8, and 10. Her opinion is not improper; there is no violation of the secondary evidence rule as she did not possess the documents at issue and/or the writings are not procurable on her expert opinion because the volume of material she recounts is far too great (Evid. Code, § 1523, subd. (c)); and the remaining statements challenged are not hearsay. In most other paragraphs any reference to third party discussions with work colleagues are not introduced for the truth of the matter asserted, and even if hearsay, can be relied upon by an expert as basis for her opinion pursuant to Evidence Code sections 801 to 803. Further, discussions of case law in paragraph 12 is not evidence – but argument and analysis in support of her opinion. Paragraph 13 contains Ms. Hipshman’s opinion – it does not lack foundation and is not improper. Exhibit 3 is Ms. Hipshman’s resume (curriculum vitae) a document that reveals why she is qualified to testify as an expert, per Evidence Code section 802. Ms. Hipshman can obviously testify about its contents based on personal knowledge.

Plaintiff also advances 10 evidentiary objections against the declaration submitted by Mr. Jeffrey Redmond, who is the School Chancellor for defendants. As above, plaintiff’s reliance on Lopez v. University Partners, supra, is misplaced, as Mr. Redmond states the facts are based on both personal knowledge and information and belief. The challenged statements in paragraphs 4, 5, 6, 7, 8, and 9 are relevant, do not involve hearsay, and are not predicated on impermissible secondary evidence given the number of documents at issue. (Evid. Code, § 1523, subd. (d)). There is no reason to conclude that statements in these paragraphs are not based on personal knowledge given Mr. Redmond’s position. Paragraph 10 of the declaration is also based on personal knowledge, is not violative of the secondary evidence rule as a result, and is relevant. Mr. Redmond’s statement– that “no institute of higher learning, e.g., University of Southern California (‘USC) or the University of Los Angeles (‘UCLA’) is required to have professors who are licensed or certified by the State of California” – is also admissible. Contrary to plaintiff’s perfunctory objections, it is not a hearsay statement; it is clearly relevant; and one can assume Mr. Redmond, as the School Chancellor for defendants, would have personal knowledge of the practices of institutes of higher learner as that would be relevant for his job performance, or have gleaned such knowledge from his position. The court overrules all 10 evidentiary objections.

On September 17, 2019, plaintiff also filed four (4) evidentiary objections to Ana Gelotti’s declaration and (filed by defendants in opposition to plaintiff’s summary adjudication motion). As the evidence contained in Ana Gelotti’s declaration is immaterial to the limited issues before the court, the court will not rule on the objections, and thus, for all intents and purposes, are denied. (Code Civ. Proc, §437c, subd. (q) [in granting or denying a summary adjudication motion, the court need rule only on those objections to evidence that it deems material to its disposition of the motion].)

C) Merits

Both parties ask the court to interpret the meaning of the professional exemption language contained in IWC Wage Order No. 4-2001, which took effect on January 1, 2001, as promulgated in section 11040, subdivision 1(A)(3)(a). This scheme generally applies to professional technical, clerical, mechanical, and similar occupations “whether paid on a time, piece rate, commission, or other basis . . . .” Specifically, Wage Order No. 4-2001, per section 11040, specifies that its provisions governing minimum wages, overtime wages, and other employment conditions do not apply to employees falling within one of the listed exemptions. (Zelasko-Barrett v. Brayton-Purcell, LLP (2011) 198 Cal.App.4th 582, 586.) One of those exemption is called the “professional exemption” (see, e.g., Sullivan v. Oracle Corp. (2011) 51 Cal.4th 1191, 1195), and the regulatory language in relevant part reads as follows: “A person employed in a professional capacity means any employee who meets all of the following requirements: [¶] (a) Who is licensed or certified by the State of California and is primarily engaged in the practice of one of the following recognized professions: law, medicine, dentistry, optometry, architecture, engineering, teaching or accounting. . . .” (§ 11040, subd. (1)(A)(3)(a); see also Zelasko-Barrett, supra, 198 Cal.App.4th at p. 596 [the exemption here is sometimes described as the ‘enumerated professions’ exemption].)[3] “Teaching” — the profession relevant for the cross-motions — is specifically defined to mean “for the purposes of Section 1 of this order, the profession of teaching under a certificate from the Commission for Teaching Preparation and Licensing or teaching in an accredited college or university.” (§ 11040, subd. (2)(R), italics added.)

The parties agree that the professional exemption is an affirmative defense, and thus, the employer bears the burden of proving an employee is exempt thereunder. (See, e.g. Combs v. Skydriver Communications, Inc., supra, 159 Cal.App.4th 1242, 1253.) They also agree that the professional category of “teaching” is the only profession at issue. They disagree (as relevant for our purposes) on the meaning and impact of the highlighted language (“an accredited college or university”). Plaintiff insists that section 11040, subdivision 1(A)(3)(a) requires defendant to prove two discrete things before the exemption applies: 1) an employee is “licensed or certified by the State of California”; and 2) the employee is “primarily engaged” in the profession of teaching. Defendants, by contrast, contend that in light of the definition of ”teaching” contained in section 11040, subdivision (2)(R), which defines “teaching” as that term is used in section 11040, subdivision (1)(A)(3)(a), the professional exemption applies simply when the instructors teach at an accredited college or university; they do not need to be certified by California, and thus, the only issue defendants must prove under section 11040, subdivision 1(A)(3)(a) is whether plaintiff (and any purported class member) were “primary engaged in the practice of . . . teaching . . . .”[4]

The interpretative tools used by courts in this context are settled. Under California law, exemptions are narrowly construed. (Combs v. Skydriver Communications, Inc. (2008) 159 Cal.App.4th 1242, 1253.) Nevertheless, courts have shown that wage orders issued by the Industrial Welfare Commission (IWC) (the agency formerly authorized to regulate working conditions in California) are given extraordinary deference, both upholding their validity and enforcing their specific terms. (Martinez v. Combs (2010) 49 Cal.4th 35, 61.) Although the IWC was defunded in 2004, its wage orders remain in effect. (Gonzalez v. Downtown LA Motors, LP (2013) 215 Cal.App.4th 36, 43.) California’s laws and wage orders are now subject to enforcement by a state agency, namely, the DLSE, which is a division of the Department of Industrial Relations, and which (in turn) is a department of California’s Labor and Workforce Development Agency. (Vaguero v. Stoneledge Furniture, LLC (2017) 9 Cal.App.5th 98, 105-106, and fn. 4.) Wage orders are quasi-legislative regulations and are construed in accordance with the ordinary principles of statutory interpretation. (Aleman v. AirTouch Cellular (2012) 209 Cal.App.4th 556, 568.) Under those principles, the court’s analysis begins by ascertaining the legislative intent underlying the wage order “so that [a court] may adopt the construction that best effectuates the purpose of the law. [Citation.]” (Hassan v. Mercy American River Hospital (2003) 31 Cal.4th 709, 715.) To do so, courts first examine the words of the wage order as the best indication of legislative intent. (Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004, 1026.) Those words should be given their ordinary and usual meaning and should be construed in their statutory context. (Ibid.) Judicial construction that renders any part of the wage order meaningless or inoperative should be avoided. (Ibid.) If the language of the wage order is clear, it is applied without further inquiry. (Aleman, supra, 209 Cal.App.4th at p. 568.) If the language can be interpreted to have more than one reasonable meaning, a court may consider “ ‘a variety of extrinsic aids, including the ostensible objects to be achieved, the evils to be remedied, the legislative history, public policy, contemporaneous administrative construction, and the statutory scheme of which the statute is a part.’ [Citation.]” (Id. at pp. 568–569; see Gonzalez v. Downtown LA Motors, LP (2013) 215 Cal.App.4th 36, 43–44.) DLSE opinion letters, while not controlling, constitute “the type of experience and considered judgment that may properly inform our judgment.” (Augustus v. ABM Security Services, Inc. (2016) 2 Cal.5th 257, 267.)

Generally, state wage and hour laws reflect the strong public policy favoring protection of workers’ general welfare and “society’s interest in a stable job market.” [Citations.]’ [Citations.]” (Cash v. Winn (2012) 205 Cal.App.4th 1285, 1297.) They are therefore liberally construed in favor of protecting workers. As our Supreme Court has stated, “ ‘[I]n light of the remedial nature of the legislative enactments authorizing the regulation of wages, hours and working conditions for the protection and benefit of employees, the statutory provisions are to be liberally construed with an eye to promoting such protection.’ [Citations.]” (Brinker, supra, 53 Cal.4th at pp. 1026–1027,; see also Murphy v. Kenneth Cole Productions, Inc. (2007) 40 Cal.4th 1094, 1103 [given the Legislature’s remedial purpose, “statutes governing conditions of employment are to be construed broadly in favor of protecting employees”].)

Applying this methodology, and taking into account all appropriate rules of construction, a limited reading of the relevant regulatory provision supports plaintiff’s interpretation. Section 11040, subdivision 1(A)(3)(a) seems to create two conjunctive requirements for the professional exemption to apply: 1) the employee must be licensed or certified by the State of California to teach; and 2) the employee is primary engaged in teaching. The meaning of “and” in this quasi-legislative scheme is manifest.

This interpretation, however, fails to account fully for section 11040, subdivision (2)(R), which defines the word “teaching” as used in subdivision (a). As noted, “teaching” means “the profession of teaching under a certificate from the Commission for Teacher Preparation and Licensing” or “teaching in an accredited college or university.” The court is required to account for all provisions in a regulatory provision or scheme, and must harmonize them if reasonably possible. That is possible here. The language in toto indicates that a teacher, to be exempt, must (always) be primarily engaged in teaching; and, additionally, must be licensed or certified by the State of California (and presumably through the “Commission for Teacher Preparation and Licensing” (Commission)) unless the teacher instructs at an “accredited college or university”; if the latter applies, no license or certification from the Commission (or the state of California) is required. The critical disjunction “or” treats each part of the definitional paragraph equally, and must (by logic), in this limited category, create an exception to the subdivision (a) requirement that a teacher must be licensed or certified by the state of California. (See, e.g., White v. County of Sacramento (1982) 31 Cal.3d 676, 680 [the “use of the words ‘or’ . . . indicates an intention to use it disjunctively so as to designate alternative or separate categories”].)

This reading comports with the legislative scheme distinguishing between those teaching positions that require a license from the Commission, and the requirements attendant to a teacher who instructs at an “accredited college or university.” Education Code section 44865, for example, provides that a valid teaching credential issued by the “State Board or the Commission of Teacher Credentialing . . . shall be deemed qualifying . . . in the following assignments . . . ,” including home teaching, classes organized primarily for adults, hospital classes, necessary small high schools, continuation schools, alternative schools, opportunity schools, juvenile court schools, county and district community day schools, and independent study. By contrast, Education Code section 94050, subdivision (a) indicates the Legislature’s full intent “to promote effective integration of private postsecondary education into all aspects of California’s educational system and to foster and improve the educational programs and services of these institutions while protecting the citizens of the state from fraudulent substandard operations.” The court’s reading of the professional exemption language is commensurate with – and reflects an actual recognition of – these important legislative distinctions.

Further, this interpretation proves generally consistent with that of the DLSE, as reflected in its opinion or advice letters. As the state agency empowered to enforce wage orders and state labor statutes, the DLSE is in a unique position to accumulate both knowledge and experience relevant to the administration of wage orders, at least as reflected in advice letters.[5] (Augustus, supra, 2 Cal.5th at p. 267.) Contrary to plaintiff’s reading, the DLSE advice letter dated January 23, 2003 supports the view that the professional exemption for teachers applies in one of two ways – when the teacher is certified by the Commission (or some other state licensing requirement presumably) or when the teacher instructs at an accredited college or university. (Dept. of Industrial Relations, DLSE Opn. Letter No. 2003.01.23 (Jan. 23, 2003). This DLSE letter details the general history of the professional exemption, focusing particularly on “teaching” as a category, and noting that the teacher exemption first appeared in the IWC Orders in 1947. The letter emphasizes that at no time did the IWC intend to adopt the federal definition of “teacher” for exemption purposes; as a result of this determination, however, some confusion ensued, and the IWC added the definition of “teaching” (at issue in section 11040, subdivision (2)(R)) in 1957, with the IWC finding that teachers who have “a recognized professional standing” – those that teach in an academic setting – have an exemption, while teachers at institutions similar to “trade schools” do not. The advice letter muses: “The DLSE’s interpretation of ‘teacher,’ which limited the exemption to those who taught in academic settings is, of course, well known to the IWC . . . .” There is no reason to assume that the “accredited college or university” language as it currently reads in Wage Order No. 4-2001 does not continue to reflect this important distinction (at least in some form or fashion).[6]

This view is also supported by a published appellate case, although perhaps not entirely to DLSE’s satisfaction. (See fn. 5, ante.) In California School of Culinary Arts v. Lujan (2003) 112 Cal.App.4th 16, the DLSE rejected California School of Culinary Arts (CSCA’s) contention that its instructors were exempt from certain provision of California wage and hour laws. Specifically, CSCA claimed that its instructors fell within the “profession of teaching” under section 11040, subdivision 1(A)(3)(a) and 2(R), as it was a private entity, employed 66 instructors, and was an “accredited college” as that term was used. DLSE disagreed, contending that because CSCA was a “cooking school,” and because it did not issue bachelor’s degrees for liberal arts or science, it did not meet the exemption requirement. (Id. at pp. 18-19.) CSCA filed a declaratory relief complaint challenging the DLSE’s interpretation of this language. The trial court granted summary judgment in favor of CSCA.

The appellate court affirmed, rejecting the DSLE’s interpretation of the relevant language. “It is abundantly apparent that California encourages and validates institutions offering a variety of fields of study, and in compliance with the operative regulation, permits institutions to be designated and recognized as a ‘college.’ CSCA has complied with the statutory requirements to be designated as a ‘college,’ and based on its accreditation with [the Accrediting Council for Independent Colleges and Schools (ACICS], it is an accredited college. The fact that it does not include the term ‘college’ in its name is irrelevant since the issue here is not how it is identified, but what it is in substance. . . .” (Id. at p. 23.) The appellate court ultimately rejected the DLSE’s argument that the exemption applies only to those academic institutions that provide a bachelor’s degree or higher (see fn. 5, ante). “Considering DLSE’s reliance on its submission of earlier records of IWC it is telling that no amendment has been made to the wage order excluding vocational schools or in any way adopting DLSE’s ‘underground regulation.’ DLSE”s self-determined definition is not supported by the documents of the early records of the IWC and its policy is not entitled to any deference. . . . It is our role to interpret the wage order to decide its enforcement in this case. . . . If the IWC determines that any limitation should be imposed on the exemption for ‘teachers in accredited colleges,’ it may do so according to formalities that apply. At present the wage order may not be read to apply only to institutions awarding baccalaureate degrees or higher.” (Id. at p. 27.)

The appellate court finished with a Ciceronian flourish. “It is obvious that the term ‘college’ must be applied in context. Here, the context is to determine if it applies to instructors of culinary arts and if their professional status exempts them from overtime wages. At its core, the difference has more to do with the independence of the ‘teacher’s’ performance than the subject matter of the instruction. Furthermore, DLSE’s crabbed definition of ‘college’ is contrary to California’s declared policy ‘to promote the effective integration of private postsecondary education into all aspects of California’s education system and to foster and improve the educational programs and services of these institutions.’ (Educ. Code, § 94705) . . . . [¶] Based on our de novo review, we affirm the judgment on the ground that the exemption afforded to teachers ‘in an accredited college or university’ is not restricted to those who teach in institutions that grant a baccalaureate degree or higher. The boundaries of California’s educational system have expanded to include a much broader category of institutions than those envisioned by DLSE.” (Id. at pp. 28-29.)

Plaintiff insists that California School of Culinary Arts supports its argument that certification by the state of California is a separate and distinct requirement – even when the employer properly contends the teacher instructs at an accredited college or university. She points to language in the opinion to the effect that CSCA’s instructors “. . . hold a valid and applicable certificate of authorization for service required by Education Code section 94915, subdivision (b)(3)” (California School of Culinary Arts, supra, at p. 25). According to plaintiff, this means “all the instructors were licensed or certified by the State of California.” (California School of Culinary Arts, supra, 112 Cal.App.4th at p. 25.) Plaintiff extrapolates that if licenses were not required, the appellate court in California School of Culinary Arts would have not felt a need to discuss the requirement.

The court is not persuaded, as plaintiff’s interpretation of this language is untethered from the all-important context in which the appellate court statements were made. Former Education Code section 94915, subdivision (b), repealed effective January 1, 2008 (Stats. 2004, c. 740 (S.B. 1544, § 7), required that the CSCA, to be certified at that time under the California Bureau for Private Post-Secondary & Vocational Education (CBPPVE) – that is, to be considered an “accredited college” under the exemption contemplated by Wage Order No 4-2001 – must certify its instructors for service as required under Education Code section 94915, subdivision (b)(3). Contrary to plaintiff’s interpretation, nothing in the opinion indicates licensing was a freestanding requirement, separate and distinct from the accreditation process itself. The certification of instructors was required in order for CSCA to receive accreditation, which in turn was necessary for CSCA to be considered an “accredited college” under the professional exemption in Wage Order No. 4-2001. The court in California School of Culinary Arts made this clear when it stated that “it follows that CSCA’s instructors are ‘teaching in an accredited college’ as defined by the IWC wage order 4-2001.” Simply put, if the accreditation process itself requires certification, then instructors must be certified so the institution can be considered an “accredited college” under the professional exemption. It follows that if the accreditation process does not require certification of teachers, than California certification of the instructors is not required for the teaching institution to fall within the “accredited college or university” portion of the professional exemption. Plaintiff misreads California School of Culinary Arts to suggest otherwise. While this distinction may be subtle, it is crucial.[7]

Plaintiff at oral argument also emphasized language from California School of Culinary Arts that seems to treat the requirement of a teaching “license[] or certifi[cation] from the State of California” in conjunction with the requirement for “teaching in an accredited college of university,” which plaintiff interprets as “very clear” support for her position. The language in the opinion at issue reads as follows: “California’s provision for overtime exemption is much narrower than the federal law. IWC wage order 4-2001, section 1(A)(3) includes a person employed in a professional capacity, licensed or certified by the State of California, engaged in ‘teaching in an accredited college or university,’ and who customarily and regularly exercises discretion and independent judgment in performing his or her duties.” (112 Cal.App.4th at p. 24, emphasis added.) Plaintiff argued at the hearing that the appellate court “itemizes a list of what is required. It doesn’t say licensed or certified or engaged in teaching at an accredited college, it is a comma. It is an itemized list of what is required.”

Use of the Oxford “comma,”[8] coupled with the conjunction “and” as used in this paragraph, is far too ephemeral to act as support for plaintiff’s position. Critically, plaintiff overlooks the paragraph’s purpose, which was offered to support the appellate court’s contention that the overtime exemption for teachers under California law is “much narrower” than under federal law, as the latter provides for overtime exemption for broad categories, such as teachers of music, trades, automobile driving, and aircraft flight instructors. (123 Cal.App.4th at p. 24.) The “serial list” was simply offered as a counter to the broader federal teaching categories, listed in serial fashion in the antecedent paragraph (i.e., not coincidentally also underscored with use of an “Oxford” comma and the conjunction “and”). It was in this regard and for this purpose the appellate court identified the narrower California categoriesasincluding a person: 1) employed in a professional capacity; 2) licensed or certified by the State of California; 3) engaged in ‘teaching in an accredited college or university’; and 4) who customarily and regularly exercises discretion and independent judgment in performing his or her duties. Simply put, the serial list was not offered as a template on how to interpret the disjunction contained in 11040, subdivision (2)(R), but as empirical support to the broader point that California exemption law for teachers is far more circumspect than its federal analogue.

Nor do the remaining cases cited by plaintiff support her position that state certification of a teaching instructor is always required (i.e., even when the teacher instructs at an “accredited college or university”). In Kettenring v. Los Angeles Unified School District (2008) 167 Cal.App.4th 507, the court concluded that adult education teachers for the Los Angeles Unified School District were exempt under the professional exemption for teaching contained in Wage Order No. 4-2001. At issue was not the exemption predicated on teaching at an “accredited college or university,” but the exemption involving teachers “licensed or certified by the State of California and . . . primary engaged in the practice of . . . teaching.” (Id. at p. 513, italics omitted.) In that regard, the court observed that there was no dispute that the adult education teachers were certified by the State of California, were engaged in teaching, and met all other requirements of the exemption (exercised independent judgment, and earn a monthly compensation far higher than two times the state minimum wage for full-time employment. (Ibid.) Nothing in Kettenring implicates (or resolves) the issue before this court.[9]

The same is true of Zelakso-Barrett v. Brayton-Purcell, LLP, supra, 198 Cal.App.4th 582. Zelasko-Barrett involved claims by a former law clerk at a law firm, who claimed the law firm incorrectly classified him as employed in a professional capacity, exempting the firm from the obligation to pay him overtime wages and provide other benefits. The appellate court disagreed with the former law clerk’s contention, applying not the exemption at issue here – section 11040, subdivision (1)(A)(3)(a) — but the exemption under section 11040, subdivision (1)(A)(3)(b)—known as the “learned professions” exemption. (Id. at p. 587.) The appellate court, relying on Campbell v. PricewaterhouseCoopers, LLP (9th Cir. 2011) 642 F.3d 820, which involved a similar question for unlicensed accountants, concluded that consistent with the Ninth Circuit, “we conclude that the professional exemption applies to a law school graduate performing legal services but not yet licensed to practice law if all of the conditions of section 1140, subdivision 1(A)(3)(b), (c), and (d) are satisfied.” (Id. at p. 590.)

In so holding (and as relevant for our purposes), Zelasko-Barrett observed that Campbell compared sections 11040, subdivision 1(A)(3)(a) and (b), and observed that “ ‘subsection (a) is much easier for an employer to prove. Subsection (a) precludes the factual disputes for which subdivision (b) is veritable hotbed – even in this case – about the employee’s actual job duties and whether those duties meet the requirements of a ‘learned’ or ‘artistic’ profession. Under subsection (a), once the employer proves the employee is licensed in California and practices one of the eight enumerated professions, the inquiry is over. For that reason, subdivision (a) is not superfluous even if every licensed accountant it covers could fall under subsection (b). Though the two subsections may often end at the same place, subsection (a) is much easier path.’” (Zelakso-Barrett, supra, 198 Cal.App.4th at p. 589, citing Campbell, supra, 642 F.3d at p. 828.) Plaintiff relies on this language to support her claim that state licensing is always required whenever the exemption under section 11040, subdivision 1(A)(3)(a) is implicated.

Plaintiff’s reliance on this language is misplaced. The statements in both Zelakso-Barrett and Campbell were dicta. Further, while it may generally be true that the eight (8) professions listed in section 11040, subdivision 1(A)(3)(a) require licensing by the state, neither case cited (let alone addressed) the definition of “teaching” contained in section 11040, subdivision 2 (R), or addressed this definition and its impact on a state licensing requirement should the teacher instruct at an ”accredited college or university,” a question that lies at the heart of the present matter. It is settled that a decision does not stand for a proposition not considered by the court; accordingly, the two cases are inapposite. (Nolan v. Anaheim (2004) 33 Cal.4th 335, 342.)

Nothing in plaintiff’s reply alters the court’s interpretation. True, defendants do not offer any documentary support for Mr. Redmond’s statement that “no institution of higher learning, e.g., the University of Southern California (“USC”) or University of California Los Angeles (“UCLA”) is required to have professors who are licensed or certified by the State of California.” This omission goes to weight, however, not admissibility. Tellingly, plaintiff makes no effort to undermine or cast any doubt on Mr. Redmond’s statement about treatment of instructors at similarly situated post-secondary institutions of higher learning. Further, plaintiff simply elevates the conjunctive language of section 11040, subdivision 1(A)(3)(a) to Olympian heights, failing to account for the disjunctive language in section 11040, subdivision 2 (R), which is manifestly of equal import. Plaintiff’s reading in the end makes the disjunctive language contained in subdivision 2(R) a nullity.[10] While plaintiff desires to treat all 8 professions listed in subdivision 1(A)(3)(a) in the same way, symmetry of treatment is not permitted by virtue of subdivision 2(R). Indeed, as noted in DLSE letter dated March 5, 1997, cited by plaintiff in reply, “. . . Teachers are listed as one of the exempt professionals in the IWC orders; however, [unlike the other professions], the word ‘teacher’ [in reality it is the word “teaching”] is specifically defined . . . .” (Dept. of Industrial Relations, DLSE Opn. Letter 1997.03.05, p. 3, italics added.)

Finally, plaintiff insists in her reply that her reading comports with the IWC’s desire to narrow the exemption for “teaching” otherwise broadly applied under federal law. She argues that to the extent the California exemption has been “expanded,” this was accomplished exclusively under subdivision 1(A)(3)(b), the “learned or artistic professions” exemption. While plaintiff’s foundational premise is generally sound – California does not look to federal law to determine the scope and meaning of the professional exemption for teaching — the conclusion she draws from this is not. The definition contained in subdivision 2(R) itself belies petitioner’s contention that the IWC always contemplated a license or certification from the state of California whenever the professional exemption for teaching is implicated.

D) Conclusion

In the end, the court overrules all but one of plaintiff’s evidentiary objection.

The court acknowledges that there is no dispositive published California appellate opinion directly addressing the narrow issue before the court. Nevertheless, the court finds that defendants’ argument is more persuasive. Accordingly, the court grants defendants’ motion for summary adjudication, concluding that instructors who teach at an “accredited college or university” as those terms are used in the professional exemption per section 11040, subdivisions 1(A)(3)(a) and 2(R) do not have to secure a teaching license or credential from the state of California unless the teaching institution requires such certification as a byproduct of the post-secondary accreditation requirement. As it appears Laurus College’s accreditation (as detailed in Mr. Redmond’s declaration) does not require state licensing or certification, there is otherwise no freestanding requirement that a license or certification is required before the professional exemption applies. The issue, as presented in this limited summary adjudication context pursuant to Code of Civil Procedure section 437c, subdivision (t) is therefore resolved in defendants favor. The court denies plaintiff’s competing motion for summary adjudication as a result. No other issues have been presented or resolved, and nothing here should be viewed by a party to the contrary.

The parties are directed to appear at the scheduled hearing.

[1] This case has a protracted procedural history, which need not be recounted in detail. Suffice it to say that the case transferred from Orange County Superior Court on November 1, 2017.

[2] Section 11040, subdivision 1(A)(3), under the caption “Professional Exemption[,]” lists at least two other requirements for the exemption to apply – subdivision (c) [customarily and regularly exercises discretion and independent judgment in the performance of duties]; and (d) [earns a monthly salary equivalent to no less than two (2) times the state minimum wage for full-time employment].)

[3] As noted, the professional exemption has other necessary elements than the one at issue in the present motions. (See fn.2, ante.) As the parties have indicated, the court is not asked to assess them in any way, and thus, nothing said here should be interpreted as determinative of them.

[4] The word “primarily” is defined in section 11040, subdivision (2)(N) as follows: “ ‘Primarily,’ as used in Section 1, Applicability, means more than one-half the employee’s work time.” Again, the parties do not ask, and the court is not otherwise determining, whether plaintiff or any other proposed member of the class meets this requirement. The court therefore makes no determination in this regard for purposes of either summary adjudication motion.

[5] An important point of clarification is offered at this stage. No party has cited to or otherwise referenced the latest DLSE Polices and Procedural Manual, dated August 2019 (hereafter, Manual), and particularly section 54.10.7.1 therein, which defines “accredited college or university” under the professional exemption as meaning “. . . a school of higher learning and academic studies, which grants the bachelor’s degree (or higher degrees) in liberal arts and/or sciences.” This omission is likely a result of Tidewater v. Marine Western, Inc. v. Bradshaw (1996) 14 Cal.4th 557, in which our high court concluded that the DLSE interpretive polices in its manual are in fact regulations that are void unless promulgated in compliance with the Administrative Procedure Act, and absent such compliance, are entitled to no deference. “Since Tidewater, many courts have reiterated that DLSE interpretative polices contained in the earlier DLSE manuals have no persuasive value and are entitled to no deference even if the police reflects the DLSE’s ‘long-standing interpretation of wage order. [Case citations omitted.]” (Cash v. Winn (2012) 205 Cal.App.4th 1285, 1302.) Because there is no indication that the Manual complies with the APA – and as well be seen, at least one Court of Appeal has expressly rejected the DLSE’s subset gloss detailing what types of “academic institutions” are contemplated by the “accredited college” language – the court will not rely on the Manual. Instead, the court relies on DLSE opinion or advice letters, as referenced in the body of this order, as they do not require compliance with the APA, and, while not controlling, can provide guidance to the court when they contain persuasive logic. (Ibid.; see Augustus, supra, 2 Cal.5th at pp. 267-268.) The opinion letter at issue suggests the DLSE has generally viewed the professional exemption applicable in two distinct ways – either when a teacher has a certification from the Commission (or perhaps from the State of California), or, alternatively, when a teacher instructs at an accredited college or university. The DSLE’s view on this matter is both relevant and informative.

[6] This also seems consistent with the declaration of Ms. Hipshman, defendant’s expert, who declares that, in light of her expertise, “I am of the opinion that . . . a teacher or instructor in an accredited private post[-]secondary instruction, including a college, is exempt from the IWC orders while engaged in teaching, regardless of whether or not they are certified by the California State Board of Education.”

[7] Defendants observe that their accreditation does not require instructors to be certified by the state of California. Education Code section 94800, et seq., known as the California Private Postsecondary Education Act of 2009, governs. The promulgated regulations are found at California Code of Regulations, title 5, section 70000, et seq. Section 71720 details the requirements for faculty at a post-secondary institution. (Cal. Code Reg., tit. 5, § 71720.) The faculty must be “duly qualified,” defined as “a person or persons who satisfy the requirements of section 71720.” (Id. at § 70000, subd. (j).) Under Section 71720, this means a faculty member in a degree program shall have “sufficient expertise to support the institution’s awarding of a degree identifying the specialty or major field of emphasis, demonstrated by, at a minimum, that the faculty members must have a degree from an approved institution which is “generally recognized in the field of instruction,” and must be at least equivalent to the level of instruction being taught or evaluated. When no degree is contemplated, the instructor “shall possess the academic, experiential and professional qualifications to teach, including a minimum of three years of experience, education and training in current practices of the subject area they are teaching.” If an instructor does not possess the required three years of experience, the institution must document the qualifications the instructor possesses that are equivalent to the minimum qualifications.” (Id. at § 71720, subds. (a) and (b). Plaintiff does not argue or otherwise claim that this particular regulatory scheme (or any other legislative or regulatory scheme necessary for defendants’ accreditation) require a teaching license or certification from the Commission or any other California state agency.

[8] An “Oxford” or serial comma is a comma used after the penultimate item in a list of three or more items, before “and” or “or.” (See e.g. The Chicago Manual of Style, 15th ed. (University of Chicago Press 2003) ¶ 6.19, and The Oxford Style Manual, 2002, Chapter 5, Section 5.13.)

[9] At oral argument plaintiff insisted that the Kettering decision “identified what the elements of the exemption are,” and in this regard clearly “state the wage order includes a professional exemption which applies to anyone licensed or certified by the state and primarily engaged in the practice of teaching. So again they are just quoting the wage order directly, it is two-step analysis.” Kettering, however,at no point discusses, let alone explores, the impact of the disjunctive “or” in section 11040, subdivision (2)(R), which lies at the heart of the present action. This decision offers no meaningful support for plaintiff’s argument predicated on a “two-step” analysis.

[10] An example perhaps underscores the point. According to plaintiff, a teacher will be exempt under the regulatory scheme if he or she is both licensed/certified by the state of California and teaches at an accredited college or university. Yet if this is true, the licensing requirement becomes the exclusive sine qua non of the professional exemption, for once a state teaching license is secured, the location (i.e., accredited college or university) becomes irrelevant. If that is the result, why include “accredited college or university” in the first place? The question itself augurs the appropriate answer; plaintiff’s reading renders the critical language superfluous, something courts eschew when interpreting regulatory language. Subdivision 2(R) logically creates an exception for the general licensing requirements of subdivision 1(A)(3)(a) when someone teaches at an accredited colleges or university.