Workforce Defense League v. Clayco, Inc. ( 2022 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 WORKFORCE DEFENSE LEAGUE, No. 2:22-cv-00503-JAM-DB 12 Plaintiff, 13 v. ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS’ 14 CLAYCO, INC., et al., MOTION TO DISMISS AND MOTION TO STRIKE 15 Defendants. 16 17 I. FACTUAL ALLEGATIONS AND PROCEDURAL BACKGROUND 18 Workforce Defense League (“Plaintiff”) is a labor management 19 cooperation committee. First Am. Compl. (“FAC”) ¶ 5, ECF No. 10. 20 It brings this action against Clayco, Inc. and United Contractor 21 Services (“Defendants”) alleging carpenters employed to work for 22 them at an Amazon Warehouse project in Tracy were not paid for 23 all hours worked, overtime wages, or premiums for missed rest 24 breaks. See generally id. Plaintiff asserts a single claim, on 25 its own behalf and on behalf of the carpenters, under California 26 Labor Code section 218.7, which allows a labor management 27 cooperation committee to bring an action against a direct 28 contractor or subcontractor for unpaid wages owed to a wage 1 claimant. Defendants now move to dismiss this claim. See Mot. 2 to Dismiss (“Mot.”), ECF No. 11.1 Plaintiff opposed the motion. 3 See Opp’n, ECF No. 15. Defendants replied. See Reply, ECF No. 4 18. For the reasons set forth below this motion is granted in 5 part and denied in part. 6 II. OPINION 7 A. Judicial Notice 8 Defendant requests the Court take judicial notice of an 9 order in the Napa County Superior Court Case Workforce Defense 10 League v. Davis Reed Construction, Inc., et al., No. 21-CV- 11 000232. Defs.’ Req. for Judicial Notice (“RJN”), ECF No. 11-3. 12 Plaintiff requests the Court take judicial notice of two 13 documents: (1) the Industrial Welfare Commission Order No. 16- 14 2001 Regulating Wages, Hours and Working Conditions in Certain 15 On-Site Occupations in the Construction, Drilling, Logging and 16 Mining Industries and (2) a Statement as to the Basis for Wage 17 Order No. 16 Regarding Certain On-Site Occupations in the 18 Construction, Drilling, Mining, and Logging Industries. Pl.’s 19 Req. for Judicial Notice (“RJN”), ECF No. 16. As matters of 20 public record, all exhibits are proper subjects of judicial 21 notice. See Trigueros v. Adams, 658 F.3d 983, 987 (9th Cir. 22 2011) (court may take judicial notice of orders and proceedings 23 in other courts); Vasserman v. Henry Mayo Newhall Mem’l Hosp., 24 65 F.Supp.3d 932, 943 (C.D. Cal. 2014) (California Industrial 25 Welfare Commission Orders are proper subjects of judicial 26 notice). Accordingly, the Court GRANTS Defendants’ and 27 1 This motion was determined to be suitable for decision without oral argument. E.D. Cal. L.R. 230(g). The hearing was scheduled 28 for August 23, 2022. 1 Plaintiff’s request for judicial notice. 2 B. Legal Standard 3 A Rule 12(b)(6) motion challenges the complaint as not 4 alleging sufficient facts to state a claim for relief. Fed. R. 5 Civ. P. 12(b)(6). “To survive a motion to dismiss [under 6 12(b)(6)], a complaint must contain sufficient factual matter, 7 accepted as true, to state a claim for relief that is plausible 8 on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) 9 (internal quotation marks and citation omitted). While 10 “detailed factual allegations” are unnecessary, the complaint 11 must allege more than “[t]hreadbare recitals of the elements of 12 a cause of action, supported by mere conclusory statements.” 13 Id. “In sum, for a complaint to survive a motion to dismiss, 14 the non-conclusory ‘factual content,’ and reasonable inferences 15 from that content, must be plausibly suggestive of a claim 16 entitling the plaintiff to relief.” Moss v. U.S. Secret Serv., 17 572 F.3d 962, 969 (9th Cir. 2009). 18 C. Analysis 19 Plaintiff asserts a single claim for unpaid wages on behalf 20 of the carpenters who worked on the Tracy-based project pursuant 21 to California Labor Code section 218.7, which makes both direct 22 contractors and subcontractors liable for any unpaid wages. 23 Plaintiff alleges that Defendants failed to pay carpenters on 24 the project overtime pay, failed to provide rest breaks or 25 adequate compensation for those missed, and failed to pay twice 26 the state minimum wage, as required because the carpenters 27 supplied their own tools. FAC ¶¶ 28, 29, 30. 28 At the outset, Defendants argue Plaintiff has failed to 1 plead sufficient facts to establish it has statutory standing to 2 pursue a claim for unpaid wages under Labor Code section 218.7, 3 as the complaint contains no allegations that Defendants, or any 4 employer of the carpenters who worked on the project, 5 participated in its formation or organization. Mot. at 8. The 6 Court rejects this argument because, as Plaintiff points out, 7 Defendants offer no authority to support their claim that a 8 joint labor management cooperation committee may only sue its 9 own members. Opp’n at 2-3; see also Cal. Lab. Code 10 § 218.7(b)(3). 11 Defendants also contend Plaintiff has failed to allege 12 sufficient facts to state a plausible claim. Mot. at 5-9. In 13 the context of wage claims, the Ninth Circuit has held that 14 “[a]lthough [. . .] detailed factual allegations regarding the 15 number of overtime hours worked are not required to state a 16 plausible claim, [. . .] conclusory allegations that merely 17 recite the statutory language are [in]adequate.” Landers v. 18 Quality Commc’ns, Inc., 771 F.3d 638, 644 (9th Cir. 2014), as 19 amended, (Jan 26, 2015), cert. denied, 575 U.S. 979 (2015); see 20 also Boyack v. Regis Corp., 812 F. App’x 428 (9th Cir. 2020) 21 (affirming dismissal of California Labor Code claims for unpaid 22 overtime, unpaid minimum wages, and rest break violations for 23 failure to meet the pleading requirements laid out in Landers). 24 At the very least, plaintiffs “should be able to allege facts 25 demonstrating that there was at least one workweek in which they 26 worked in excess of forty hours and were not paid overtime 27 wages.” Landers, 771 F.3d at 646. 28 The Court finds Plaintiff has alleged sufficient factual 1 detail here to state a claim. As the Ninth Circuit held in 2 Landers a plaintiff “may establish a plausible claim by 3 estimating the length of her average workweek during the 4 applicable period and the average rate at which she was paid, 5 the amount of overtime wages she believes she is owed, or any 6 other facts that will permit the court to find plausibility.” 7 Id. at 645. Here, Plaintiff alleges the average workweek 8 consisted of 56 hours a week and that claimants were paid $25 an 9 hour for all hours worked, including overtime hours. FAC ¶¶ 15, 10 17. This is sufficient to allege a plausible claim for relief 11 for failure to pay overtime. See Landers, 771 F.3d at 645. 12 Defendants also contend that Plaintiff’s allegations 13 regarding the carpenters use of tools and failure to provide 14 meal and rest breaks cannot support their claim under California 15 Labor Code section 218.7 and therefore moves to strike those 16 allegations under Federal Rule of Civil Procedure 12(f) which 17 allows the court to “strike from a pleading [. . .] any 18 redundant, immaterial, impertinent, or scandalous matter.” Mot. 19 at 9-14. 20 Labor Code section 218.7(b)(3) provides that a joint labor- 21 management cooperation committee may bring an action against a 22 direct contractor or subcontractor at any tier for unpaid wages 23 owed to a wage claimant by the direct contractor or 24 subcontractor. Plaintiff alleges that “Wage Order 16, section 25 8, required Defendants to pay Wage Claimants twice the state 26 minimum wage, because Defendants required Wage Claimants to 27 bring their own tools.” FAC ¶ 30. But the section upon which 28 Plaintiff relies is merely an exception to Labor Code section 1 2802 which requires an employer to pay employees’ expenditures 2 or losses incurred in the discharge of their duties. Cal. Lab. 3 Code § 2802(a). Wage Order 16, section 8 requires employers to 4 furnish all tools and equipment necessary to perform a job. It 5 exempts from this general rule employees “whose wages are at 6 least two (2) times the minimum wage.” Cal. Code Regs., tit 8, 7 § 11160, ¶ 8(B). “In providing for this exception, the Wage 8 Order did not create a new minimum wage or prevailing minimum 9 wage for employees who must furnish their own tools.” Gonzalez 10 v. Nefab Packaging, Inc., No. LA CV13-04499 JAK (SSx), 2013 WL 11 12321976, at *4 (C.D. Cal. Oct. 30, 2013), aff’d, 637 F. App’x 12 310 (9th Cir. 2016). Rather, the remedy for an employee who was 13 improperly required to provide their own tools is to make the 14 employer liable for the cost of the tool or equipment under 15 Labor Code section 2802. See id. Accordingly, Plaintiff’s 16 allegations regarding the carpenters furnishing their own tools 17 are immaterial to their claim for unpaid wages. The Court 18 therefore grants Defendants’ motion to strike the following 19 allegations: 20 • “Defendants required Wage Claimants to provide their 21 own tools, including impact drills, lasers, drywall 22 screw guns, and harnesses” from paragraph 15. 23 • Paragraph 19 in its entirety. 24 • “Wage Order 16, section 8, required Defendants to Pay 25 Wage Claimants twice the state minimum wage, because 26 Defendants required Wage Claimants to bring their own 27 tools” from paragraph 30. 28 The allegations of unpaid premiums for meal and break 1 violations are, however, relevant, as the California Supreme 2 Court recently held “that premium pay is fairly understood as 3 falling within the Labor Code’s general definition of wages.” 4 Naranjo v. Spectrum Sec. Servs., Inc., 509 P.3d 956, 970 (Cal. 5 2022). Defendants attempt to avoid this result, relying on 6 Kirby v. Immoos Fire Prot., Inc., 274 P.3d 1160 (Cal. 2012). In 7 Kirby, the California Supreme Court considered whether an action 8 under section 226.7 for violation of meal and rest provisions 9 was an “action brought for the nonpayment of wages” for purposes 10 of fee-shifting under Labor Code section 218.5. Id. at 1160. 11 The Court concluded that “a section 226.7 action is brought for 12 the nonprovision of meal and rest periods, not for the 13 ‘nonpayment of wages.’” Id. But here, unlike the provision at 14 issue in Kirby, section 218.7(b)(3) is not cabined to actions 15 for the nonpayment of wages. Rather 218.7 allows Plaintiff to 16 bring a claim for any unpaid wages, which as Naranjo makes clear 17 includes premiums for missed meal and rest periods. Naranjo, 18 509 P.3d at 970. Defendants, as the moving party, have not 19 carried their burden to show dismissal is warranted as a matter 20 of law under Kirby. The Court also declines to strike 21 Plaintiff’s references to other statutory codes as they may be 22 relevant to show what unpaid wages are due under Labor Code 23 section 218.7. Opp’n at 15. 24 Plaintiff’s meal and rest period violations allegations do, 25 however, lack specificity. See Perez v. DNC Parks & Resorts at 26 Sequoia, No. 19-cv-00484-DAD-SAB, 2020 WL 4344911, at *6 (E.D. 27 Cal. July 29, 2020) (“To successfully state a meal or rest 28 claim, plaintiffs must allege facts specifically identifying an nnn enn nnn een nnn en eo nnn nn ne oo nn NO ED OE 1 instance where they were deprived of a meal or rest break.”). 2 Therefore, to the extent Plaintiff’s claim is based on meal and 3 rest break violations it is dismissed without prejudice. See 4 Leadsinger, Inc. v. BMG Music Pub., 512 F.3d 522, 532 (9th Cir. 5 2008) (explaining leave to amend should be freely given unless 6 there has been undue delay, bad faith, repeated failure to cure 7 deficiencies, it would cause undue prejudice to the opposing 8 counsel or would be futile). 9 Til. ORDER 10 For the reasons set forth above, the Court DENIES in part 11 and GRANTS in part Defendants’ motion to dismiss. Plaintiff’s 12 claim is dismissed without prejudice to the extent it relies on 13 allegations of meal and break violations. If Plaintiff elects to 14 amend its complaint, it should file its Second Amended Complaint 15 | within twenty days (20) of this Order. Defendants’ responsive 16 | pleadings are due within twenty days (20) thereafter. 17 Defendants’ motion to strike is also GRANTED in part and DENIED 18 in part. 19 IT IS SO ORDERED. 20 Dated: August 19, 2022 21 cp, JOHN A. MENDEZ 23 SENIOR UNITED*STATES DISTRICT JUDGE 24 25 26 27 28