2011-00116221-CU-OE

Steve Cox vs. County of Sacramento

Nature of Proceeding: Hearing on Demurrer and Motion to Strike First Amended Complaint

Filed By: Whitefleet, John R.

** Judge Cadei discloses that his wife, Toni J. Moore, is the Executive Director of
the First 5 Sacramento Commission, an entity which is part of the County of
Sacramento. First 5 California and 58 First 5 County Commissions were created
by statewide voter initiative passed in 1998. First 5 is separately funded out of
special tobacco tax proceeds and is directed to support programs for children.
As such the Commission is not dependent on the general funds of Sacramento
County for its operations. The Board of Supervisors of Sacramento County
does review and approve its yearly budgets and long-term plans. **

The demurrer of Defendant County of Sacramento (“County”) is OVERRULED.

Preliminarily, the court notes that the County has denominated its motion as a
”demurrer and/or motion to strike.” The reason for the disjunctive is unclear given that
the County has not identified any particular allegations that it asserts should be
stricken. The County does ask the court to strike the second cause of action, which is
predicated on statutory and regulatory violations. (See Moving Memo., Part IV.) A
demurrer, not a motion to strike, is the proper vehicle to attack an entire cause of
action at the pleading stage. (Ferraro v. Camarlinghi (2007) 161 Cal.App.4th 509, 528
-529.) Given this, and because the instant motion appears in other respects to be a
demurrer, the court treats it as a demurrer only.

This is an action by unionized County employees (the “Plaintiffs”) who have worked at
the Sacramento Regional Wastewater Treatment Plant (“Plant”) pursuant to a
Memorandum of Understanding (“MOU”). Plaintiffs allege they and others similarly
situated have not been paid for overtime and/or pre-shift activities, including the unpaid
donning and “doffing” of work attire prior to and after shifts as well as attending unpaid
pre-shift briefings. The operative first amended complaint (“FAC”) contains two causes
of action for “Failure to Pay Overtime and/or Straight Time Pay in Breach of Contract”
and “Failure to Pay Statutory Minimum Wage in Violation of Labor Code §§ 1182.11,
1182.12, 1194, and 8 California Code of Regulations § 11000, et seq.” The County
demurs to both causes of action on grounds that the allegations fail to state facts
sufficient to state a cause of action.

The court previously granted the County’s motion for judgment on the pleadings as to
Plaintiffs’ statutory/regulatory causes of action in the original complaint. (See order of
03/29/13.) In the same ruling, the court denied the motion as to Plaintiffs’ breach of
contract cause of action. The court granted leave to amend.

The First Cause of Action for Breach of Contract

The demurrer is OVERRULED.

The County argues that the first cause of action is barred because Plaintiffs have not
alleged exhaustion of administrative remedies by complying with all the required Steps
of the grievance procedures set forth in the MOU. (See RJN, Exh. B at 11-15.)
Although Plaintiffs allege compliance with Steps 1 and 2, they have not alleged
compliance with Step 3. (Step 4 affords a right, but does not impose a duty, to
proceed to arbitration.) Plaintiffs allege that they were precluded from proceeding to
Step 3 because only the Union may complete that Step. (See FAC, ¶ 19.) Without
analyzing the relevant provisions of the MOU, the County appears to argue that
individual employees may initiate Step 3 review whether or not the Union elects to do
so.

Section 6.10(c) of the MOU refers to Step 3 by providing that “the Union shall reserve
the right to choose either” mediation or an appeal to the County Executive or the
Executive’s designee. (RJN, Exh. B at 13, § 6.11(a).) Section 6.12(a) further provides
that:

“If the Union chooses not to utilize mediation and is not satisfied with the
decision rendered pursuant to Step 2, he/she may appeal the decision
within five (5) working days to the County Executive. The employee may
be represented by a Union representative.”

(Id., Exh. B at 14, § 6.12(a).) If the MOU does not plainly require the Union to initiate
Step 3, then it is at least ambiguous on the subject. Specifically, it is unclear whether
the term “he/she” in the above-quoted passage refers to its grammatical antecedent,
the Union, or to an individual grievant.

The burden was on the County to demonstrate that its demurrer should be sustained.
Discharging that duty required the County to explain why the MOU provisions cited
above must be construed such that an individual employee may initiate Step 3.
Because the County has not made such a demonstration, and indeed has failed to
perform a genuine contract analysis, the court will not sustain the demurrer on grounds
that Plaintiffs have not alleged compliance with their internal grievance procedure.

The Second Cause of Action for Statutory and Regulatory Violations

The demurrer is OVERRULED.

First, the County argues that the second cause of action violates this court’s order
granting in part the County’s motion for judgment on the pleadings as to the original
complaint. (See Moving Memo., Part IV.) In that order, the court agreed with the
County that, as then-alleged, Plaintiffs’ statutory/regulatory cause of action for State-
legislated minimum wage was barred by article XI, § 5(a) of the California Constitution,
which affords charter cities and counties’ “home rule” over their employees’
compensation. (See Order of 03/29/13; see also, e.g., State Bldg. and Construction
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Trades Council of Cal., AFL-CIO v. City of Vista [“ City of Vista”] (2012) 54 Cal.4 547,
555 [charter municipalities’ may govern themselves as to municipal affairs free of state
legislative intrusion].) The court explained that home rule entitles the County to set its
employees’ compensation absent a showing that the exercise of home rule implicates
a conflicting statewide concern. Because the original complaint did not identify any
such conflict, the court granted judgment on the pleadings but also granted Plaintiffs
leave to amend. Hence, the court’s order of 03/29/13 does not bar Plaintiffs from
attempting to state their statutory/regulatory cause of action in the FAC.

Next, the County argues that, because it is a charter municipality and has adopted the
MOU governing Plaintiffs’ compensation, it is not required to comply with the State’s
minimum wage laws and, therefore, the allegations supporting the first cause of action
do not state a valid cause of action. Plaintiffs counter that (1) there is no published
opinion holding that home rule exempts chartered municipalities from complying with
the State’s minimum wage laws and (2) provision of State-enacted minimum wages to
all public employees is a matter of statewide concern that trumps home rule.

In deciding whether a matter falls within the home rule authority of charter
municipalities, courts employ a four-part test: (1) does the municipal ordinance or rule
regulate activity that can be characterized as a municipal affair; (2) does the case
being litigated present an actual conflict between municipal and state law; (3) does the
state law address a matter of statewide concern; and (4) does the state law reasonably
relate to resolution of the statewide concern, and is it narrowly tailored to avoid
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unnecessary interference in local governance. (See City of Vista, supra, 54 Cal.4 at
556 [citation omitted].) The County’s regulation of its wastewater treatment
employees’ activities at the Plant is a municipal affair. Thus, to prevail on its demurrer,
the County must demonstrate that (a) there is an actual conflict between the County’s
work requirements for Plant employees and the State’s wage laws and either that (b)
the applicable state statutes do not address a matter of statewide concern, or (c) the
statutes are not both reasonably related to that concern and narrowly tailored to avoid
unnecessary intrusion into municipal sovereignty. If there is no actual conflict between
County work requirements and state wage laws, then state law applies. (See Howard
Contracting, Inc. v. G. A. MacDonald Constr. Co. [“Howard Contracting”] (1998) 71
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Cal.App.4 38, 51.)

In support of the second cause of action, Plaintiffs allege:
“Defendant’ failure to pay any wages to Plaintiffs and the similarly
situated [employees] for time worked in excess of the scheduled 8.0 hour
shifts violates Labor Code §§ 1182.11, 1182.12, and 1194, as well as 8
California Code of Regulations § 1100, et seq., which require that
employees be paid statutory minimum wage for every hour and fraction
of an hour worked.”

(FAC, ¶ 42.) The County does not dispute Plaintiffs characterization of the above-
references statutes and regulation. Thus, in order to establish that Plaintiffs’
allegations must be construed to establish a direct conflict between state and local
wage measures, it must point to allegations or judicially noticeable matters establishing
one or more County measures that permit payment of wages at levels below statutory
minimum wage for every hour and fraction of an hour worked. Because the County
has not cited any County measure, including any provision of the applicable MOU,
permitting the County to withhold payments at the above-referenced, statewide
minimum levels, the County has not met this burden, and the demurrer must be
overruled.

In reaching its conclusion, the court rejects the County’s position that, in analyzing the
existence vel non of a conflict between state and County measures, the court must
compare the State’s wage laws with “the Constitutional mandate afforded the County
to set its own rates of compensation to its employees… .” (See County Responsive
Supp. Brief at 2:1-5.) The correct comparison is between state and local measure, not
between state law and the State’s Constitution. (See Howard Contracting, 71
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Cal.App.4 at 51.)

The court likewise rejects the County’s argument that the cases have established a
general rule that, where the Legislature enacts a wage law of statewide application
and does not expressly exempt charter municipalities, that failure in itself establishes a
conflict for purposes of the home rule doctrine. (See County Supp. Brief at 3:11-13.)
None of the County’s cases contain a holding to this effect, and the court is not
persuaded. (See State Bldg. and Constr. Trade Council of Calif., AFL-CIO v. City of
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Vista (2012) 54 Cal.4 547, 560 [“Because the state’s prevailing wage law does not
exempt charter cities, and because Vista’s ordinance prohibits compliance with that
law…we conclude that an actual conflict exists between state law and Vista’s
ordinance”] [emphasis added]; Sonoma County Org. of Public Employees v. County of
Sonoma (1979) 23 Cal.3d 296, 315 [“There can be no doubt that there is a conflict
between the provision of section 16280 invalidating wage increases agreed to by cities
and counties and the ordinances or resolutions of the local agencies which ratified the
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agreement”]; Dimon v. County of Los Angeles (2008) 166 Cal.App.4 1276, 1280,
1285 [where state law required meal breaks but a municipal measure made meal
breaks contingent, home rule doctrine supported application of municipal measure
over state law]; see also Dimon at 1287 [“home rule doctrine…bars application of a
contrary state law…] [emphasis added]; Curcini v. County of Alameda (2008) 164
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Cal.App.4 629, 646 [“[I]f a charter provision is properly authorized, then it supersedes
general state laws in conflict”] [emphasis added]; Stitt v. San Francisco Mun. Transp.
Agency , 163 Lab. Cas. (CCH) P36,090, (N.D. Cal., Jan. 8, 2013) U.S. Dist. LEXIS
3541, at *20 [“[T]he court in Curcini did not have an occasion to consider whether
home rule authority would supersede minimum wage requirements under Labor Code
section 1194, as local regulations required the County of Alameda to pay at least
straight-time wages for all time worked”].)
Because the court overrules the demurrer based on the County’s failure to establish a
conflict between state and County wage measures, the court does not address the
other elements of the home rule test.

Judicial Notice

The parties’ requests for judicial notice are GRANTED.

Conclusion

The demurrer is overruled.

The County is directed to file and serve its answer no later than October 21, 2013.

The minute order is effective immediately. No formal order pursuant to CRC 3.1312 or
further notice is required.