Workforce Defense League v. Clayco, Inc. ( 2023 )

1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 EASTERN DISTRICT OF CALIFORNIA 9 10 WORKFORCE DEFENSE LEAGUE, No. 2:22-cv-00502-JAM-DB 11 Plaintiff, 12 v. ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS’ 13 CLAYCO, INC.; and UNITED MOTION TO DISMISS AND MOTION TO CONTRACTOR SERVICES, LLC STRIKE 14 Defendants. 15 16 Clayco, Inc and United Contractor Services, LLC 17 (“Defendants”) petition the Court to dismiss or, in the 18 alternative, strike portions of Workforce Defense League’s 19 (“Plaintiff”) Second Amended Complaint (“SAC”). See Mot. to 20 Dismiss (“Mot.”), ECF No. 25. Defendants claim that (1) the SAC 21 fails to allege sufficient facts to support Plaintiff’s claim for 22 unpaid wages under California Labor Code § 218.7 and 23 (2) allegations relating to Wage Claimants’ (“Claimants”) use of 24 their own tools, rest breaks, unpaid overtime, and relief under 25 statutes other than § 218.7 should be stricken as immaterial. 26 Id. at 2-4. Plaintiff opposes the motion, noting the Court’s 27 prior orders relating to this case. See Opp’n, ECF No. 26, at 1- 28 2. Defendants replied. See Reply, ECF No. 27. 1 For the reasons set forth below, this Court GRANTS in part 2 and DENIES in part Defendants’ motion.1 3 I. FACTUAL ALLEGATIONS AND PROCEDURAL BACKGROUND 4 As the facts are already known to the parties, the Court 5 repeats them only as necessary to explain its decision. 6 Plaintiff is a labor management cooperation committee that 7 has brought this action on behalf of Claimants against 8 Defendants, alleging that Defendants did not pay Claimants for 9 all hours worked, overtime wages, or premiums for missed rest 10 breaks in the construction of an Amazon Fulfillment Center in 11 Sacramento. See generally SAC, ECF No. 20. Plaintiff alleges 12 that Claimants worked on the project with their own tools from 13 January through May 2021; Claimants worked approximately ten 14 hours per day Monday to Friday, eight hours on Saturday, and 15 sometimes on Sundays, totaling approximately fifty-eight hours 16 per week. Id. ¶¶ 13, 16. Plaintiff claims that Claimants were 17 promised an hourly pay rate of $20 to $24 but were not paid fully 18 for either their regular or overtime hours. Id. ¶¶ 14-16. As 19 for rest breaks, Plaintiff alleges that Claimants were never 20 given required breaks and only received a single meal break; 21 Claimants also did not receive monetary premiums for the missed 22 breaks. Id. ¶ 17. 23 On January 28, 2022, Plaintiff filed its complaint in state 24 court; the case was removed to this Court one month later. See 25 Compl., Exhibit 1 to Notice of Removal, ECF No. 1; Notice of 26 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 December 6, 2023. 1 Removal, ECF No. 1. After the parties met and conferred, 2 Plaintiff filed a first amended complaint (“FAC”), to which 3 Defendants filed a motion to dismiss. See FAC, ECF No. 9, Mot. 4 to Dismiss, ECF No. 10. On August 22, 2022, the Court issued its 5 order granting Defendants’ motion with leave to amend. See 6 Order, ECF No. 19. Several weeks later, Plaintiff filed the SAC, 7 to which Defendants filed the instant motion. See SAC, Mot. 8 Plaintiff opposed the motion. See Opp’n. Defendants replied. 9 See Reply. 10 II. OPINION 11 A. Legal Standard 12 In considering a motion to dismiss for failure to state a 13 claim upon which relief can be granted under FRCP 12(b)(6), the 14 Court must accept the allegations in the FAC as true and draw all 15 reasonable inferences in favor of Plaintiff. Moss v. U.S. Secret 16 Serv., 572 F.3d 962, 969 (9th Cir. 2009) (citing Ashcroft v. 17 Iqbal, 556 U.S. 662, 678 (2009)). The complaint must possess 18 more than “a formulaic recitation of the elements of a cause of 19 action”; it must contain non-conclusory, factual allegations 20 sufficient “to raise a right to relief above the speculative 21 level.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 554 22 (2007). 23 In considering a motion to strike, FRCP 12(f) provides in 24 pertinent part that “the Court may order stricken from any 25 pleading any insufficient defense or any redundant, immaterial, 26 impertinent, or scandalous matter . . . Motions to strike are 27 disfavored and infrequently granted. A motion to strike should 28 not be granted unless it is clear that the matter to be stricken 1 could have no possible bearing on the subject matter of the 2 litigation.” Bassett v. Ruggles et al., 2009 WL 2982895 at *24 3 (E.D. Cal. Sept. 14, 2009) (internal citations omitted). 4 B. Analysis 5 Defendants contend that Plaintiff’s sole cause of action in 6 the SAC should be dismissed because Plaintiff has failed to 7 satisfy the minimum pleading requirements under Landers v. 8 Quality Communications, Inc., 771 F.3d 638 (9th Cir. 2014). Mot. 9 at 4. Specifically, Defendants claim that Plaintiffs have failed 10 to: (1) identify a single work week in which Claimants were 11 required to work overtime or were not paid for their work; and 12 (2) identify a single instance where Claimants did not receive 13 rest breaks. Id. at 5-8. In the alternative, Defendants argue 14 that Plaintiff’s meal and rest break allegations should be 15 stricken because they are beyond the scope of Labor Code § 218.7, 16 which only permits claims for unpaid wages and not the 17 nonprovision of meal and rest breaks. Id. at 8-14. Defendants 18 also request that the Court strike Plaintiff’s references to 19 Claimants having to use their own tools on the project as well as 20 Plaintiff’s requests for relief under statutes other than § 218.7 21 because both are immaterial to the underlying claim. Id. 14-15. 22 1. Overtime Wages 23 The Court finds Plaintiff has alleged sufficient factual 24 detail to state a claim for unpaid overtime wages. As the Ninth 25 Circuit held in Landers, a plaintiff “may establish a plausible 26 claim by estimating the length of her average workweek during the 27 applicable period and the average rate at which she was paid, the 28 amount of overtime wages she believes she is owed, or any other 1 facts that will permit the court to find plausibility.” 771 F.3d 2 at 645. Plaintiff alleges, from January to May 2021, the average 3 workweek consisted of fifty-eight hours a week and that Claimants 4 were promised pay of $20 to $24 an hour for all hours worked, 5 including overtime hours, which they did not receive. SAC ¶¶ 13- 6 16. This is sufficient to allege a plausible claim for relief 7 for failure to pay overtime. See Landers, 771 F.3d at 645. 8 2. Meal and Rest Break Violations 9 As for Plaintiff’s meal and rest break allegations, the 10 Court finds that Plaintiff has alleged a plausible claim for 11 unpaid wages related to the denial of meal and rest breaks. “To 12 successfully state a meal or rest break claim, [p]laintiffs must 13 allege facts specifically identifying an instance where they were 14 deprived of a meal or rest break” or show that an employer did 15 not schedule breaks at all. Perez v. DNC Parks & Resorts at 16 Sequoia, No. 119CV00484DADSAB, 2020 WL 4344911, at *6 (E.D. Cal. 17 July 29, 2020); Krauss v. Wal-Mart, Inc., No. 2:19-CV-00838-JAM- 18 DB, 2020 WL 1874072, at *2 (E.D. Cal. Apr. 15, 2020). In this 19 case, Plaintiff alleges that Claimants were never given required 20 rest breaks and only received a single meal break, all of which 21 occurred without receiving premium pay, which the Court finds 22 sufficient to meet the applicable pleading standard. SAC ¶ 17. 23 The California Supreme Court in Naranjo v. Spectrum Security 24 Services Inc. held that “premium pay is fairly understood as 25 falling within the Labor Code's general definition of wages.” 26 509 P.3d 956, 970 (Cal. 2022). Defendants attempt to avoid this 27 result, relying on Kirby v. Immoos Fire Prot., Inc., 274 P.3d 28 1160 (Cal. 2012). Mot. at 9-11. In Kirby, the California 1 Supreme Court considered whether an action under § 226.7 for 2 violation of meal and rest provisions was an “action brought for 3 the nonpayment of wages” for purposes of fee-shifting under Labor 4 Code § 218.5. Id. at 1160. The Court concluded that “a section 5 226.7 action is brought for the nonprovision of meal and rest 6 periods, not for the ‘nonpayment of wages.’” Id. But here, 7 unlike the provision at issue in Kirby, § 218.7(b)(3) is not 8 limited to actions for the nonpayment of wages. Rather § 218.7 9 allows Plaintiff to bring a claim for any unpaid wages, which as 10 Naranjo makes clear includes premiums for missed meal and rest 11 periods. Naranjo, 509 P.3d at 970. Defendants reference to 12 Coleman v. Jenny Craig, Inc., 649 F. App’x 387 (9th Cir. 2016) is 13 immaterial because rest break premiums, the remedy for a § 226.7 14 violation, are considered unpaid wages. See Workforce Def. 15 League v. Clayco, Inc., No. 2:22-CV-00503-JAM-DB, 2022 WL 16 3587553, at *3 (E.D. Cal. Aug. 22, 2022). Defendants have failed 17 to show that dismissal is warranted as a matter of law and, 18 accordingly, the Court declines to strike Plaintiff’s references 19 to the nonprovision of meal and rest breaks. 20 3. Use of Personal Tools 21 Defendants also claim that Plaintiff’s allegations regarding 22 the use of Claimants’ own tools in the construction of the 23 project and requests for relief for attorney’s fees and costs and 24 interest are immaterial to Plaintiff’s wage claim. Mot. at 14- 25 15. Labor Code § 218.7(b)(3) provides that a joint labor- 26 management cooperation committee may bring an action against a 27 direct contractor or subcontractor at any tier for unpaid wages 28 owed to a wage claimant by the direct contractor or 1 subcontractor. Plaintiff alleges that Wage Order 16, ¶ 8, 2 required Defendants to pay Claimants twice the state minimum 3 wage, because Defendants required Claimants to bring their own 4 tools. Opp’n at 12-14. But the section upon which Plaintiff 5 relies is merely an exception to Labor Code § 2802, which 6 requires an employer to pay employees’ expenditures or losses 7 incurred in the discharge of their duties. Cal. Lab. Code 8 § 2802(a). Wage Order 16, ¶ 8 requires employers to furnish all 9 tools and equipment necessary to perform a job. It exempts from 10 this general rule employees “whose wages are at least two (2) 11 times the minimum wage.” Cal. Code Regs., tit 8, § 11160, 12 ¶ 8(B). “In providing for this exception, the Wage Order did not 13 create a new minimum wage or prevailing minimum wage for 14 employees who must furnish their own tools.” Gonzalez v. Nefab 15 Packaging, Inc., No. LA CV13-04499 JAK (SSx), 2013 WL 12321976, 16 at *4 (C.D. Cal. Oct. 30, 2013), aff'd, 637 F. App'x 310 (9th 17 Cir. 2016). Rather, the remedy for an employee who was 18 improperly required to provide their own tools is to make the 19 employer liable for the cost of the tool or equipment under Labor 20 Code § 2802. See id. Accordingly, Plaintiff's allegations 21 regarding the Claimants furnishing their own tools are immaterial 22 to their claim for unpaid wages. The Court therefore grants 23 Defendants’ motion to strike the following allegations: 24 (1) “Defendants required Wage Claimants to provide their own 25 tools, including screw guns, routers, bazookas, and pumps” from 26 paragraph 13; (2) Paragraph 18 in its entirety; (3) “Wage Order 27 16, section 8, establishes that workers required to bring their 28 own tools must be paid twice the state minimum wage” from nee nn nnn ene nnn en EE OE EI I EE 1 paragraph 23; and (4) “Wage Order 16, section 8, required 2 Defendants to pay Wage Claimants twice the state minimum wage, 3 | because Defendants required Wage Claimants to bring their own 4 tools” from paragraph 29. 5 4, Other Labor Code Sections 6 The Court also grants Defendants’ motion to strike the 7 allegations related to Labor Code §§ 218.5 and 1194. Plaintiff's 8 concede that these sections are immaterial because of § 218.7's 9 scope. Opp’n at 17-18. Specifically, the Court grants 10 Defendants’ motion to strike the following allegations: 11 (1) “218.5% and “1194” from paragraph 25; (2) “218.5” and “1194” 12 from paragraph 30; and (3) their related allegations in the 13 | prayer for relief. 14 Til. ORDER 15 For the reasons set forth above, this Court GRANTS in part 16 | and DENIES in part Defendants’ motion to dismiss and/or strike. 17 Defendants’ response to the Second Amended Complaint is due 18 within twenty days from the date of this Order. 19 IT IS SO ORDERED. 20 Dated: January 24, 2023 21 cp, JOHN A. MENDEZ 23 SENIOR UNITED*STATES DISTRICT JUDGE 24 25 26 27 28