IN THE SUPREME COURT OF THE STATE OF WASHINGTON 

### CERTIFICATION FROM THE UNITED STATES DISTRICT COURT FORTHE WESTERN DISTRICT OF WASHINGTON IN ANA LOPEZ DEMETRIO and FRANCISCO EUGNIO PAZ, Plaintiffs,


### v. SAKUMA BROTHERS FARMS, INC., Defendant. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )



# _____________________ ) No. 90932-6
ENBANC

Filed 

### JUL 16 2015

Yu, 

### J.- We have been asked to answer two certified questions arising from
a class action employment lawsuit pending in federal district court. Washington laborregulations allowemployeestotake shortrestbreaks "onthe employer'stime." When applied to employees paid by the hour, that means employers must pay employees their regular hourly rate during these briefperiods ofinactivity. HourlyDemetrio v. Sakuma Bros. Farms, Inc., No. 90932-6 employees, in other words, remain "on the clock" during breaks under undisputed Washington law. To answer the certified questions here, we must interpret "on the employer's time" and applythe languageto agricultural employees who are notpaidbythehour but rather by the piece. A piece rate is tied to the employee's output (for example, per pound of fruit harvested) and is earned only when the employee is actively producing. Thus for employees paid a piece rate, the clock stops during periods of inactivity however brief. The central issue is whether employers can fold payment for rest breaks, when the clock is stopped, into the piece rate consistently with the mandate that breaks be paid "on the employer's time." This phrase appears in the regulation applicable to agricultural employees: Every employee shall be allowed a rest period ofat least ten minutes, on the employer's time, in each four-hour period of employment. For purposes of computing the minimum wage on a piecework basis, the time allotted an employee for rest periods shall be included in the number ofhours for which the minimum wage mustbepaid. WAC 296-131-020(2) (emphasis added). We rely on the plain language ofthat regulation to conclude that employers must pay employees for rest breaks separate and apart from the piece rate. An allinclusive piece rate compensates employees for rest breaks by deducting pay from the wages the employeehas accumulatedthatday. Hourly employees do not finance their own rest breaks in this way, and requiring pieceworkers to do so strips the
2

### Demetrio v. Sakuma Bros. Farms, Inc., No. 90932-6 phrase "on the employer's time" of any practical meaning. That same language requires thatrestbreaks for pieceworkers be paid at least atthe applicable minimum wage orthe employee's regular rate, whichever is greater. BACKGROUND This case began in 2013 when two workers sued SakumaBrothers Farms Inc. in federal district court on behalf of all seasonal and migrant agricultural workers Sakuma employs (Workers). Sakuma operates a berry farm in Skagit County and hireshundreds ofmigrant and seasonal workers to harvest its crop each year. These Workers, many ofwhom speaklittle English, travel to the SkagitValleyto handpick Sakuma's strawberries, blackberries, and blueberries. For that work, Sakuma pays
a "piecerate" wage based onthe Workers' productivity-e.g., an amountperpound
or per box offruit harvested. The piece rate is the only compensation the Workers receive. As a Sakumarepresentative testified, "[I]fthe picker is notpicking
..., the picker is not earning money." Doc. 33, at 7 (Decl. ofMarc C. Cote in Supp. ofMot. To Certify Legal Questions to Wash. Supreme Ct.). The Workers' class action lawsuit asserted several state and federal claims arising from Sakuma's use ofpiece rate wages. In the only claim relevant here, the Workers allege that Sakuma deprived them ofpaid rest breaks required by WAC 296-131-020(2), which provides that "[e]very employee shall be allowed a rest period ofat least ten minutes, 

### on the employer's time, in each four-hour period of

3Demetrio v. Sakuma Bros. Farms, Inc., No. 90932-6 employment." (Emphasis added.) The Workers contend "on the employer's time"
means that Sakuma must pay a wage separate from the piece rate for the 1 0-minute period they are on break, since no piece rate wages accumulate during that time. Sakumaresponds that it sets thepiece rate with rest periods in mind and thatbreaks
are therefore "onthe employer's time" as regulated. Whilethe casewaspendinginfederal courtand after some discovery, Sakuma agreedto settleeachoftheWorkers' retroactive claims. ButSakumadeniedliability and expressly preserved its challenge to the Workers' prospective claim that "Sakumamust payfor the time piece rate workers spend in rest breaks underWAC 296-131-020(2)." Doc. 27, at 17 (Stipulation of Settlement & Release between P1s. & Def.). Thus the settlement does not affect the Workers' claim for declaratory reliefrequiring pay separate and apart from thepiecerate for thesebriefrestperiods going forward. The federal district court granted the Workers' motion to certify to
us two questions related to that claim. CERTIFIED QUESTIONS 1. Does a Washington agricultural employer have an obligation under WAC 296-131-020(2) and/or the Washington Minimum Wage Act [(MWA), ch. 49.46 RCW,] to separately pay piece-rate workers for the rest breaks to which they are entitled? 2. Ifthe answer is "yes," how must Washington agricultural employers calculate the rate ofpay for the rest break time to which piece-rate workers are entitled?



### 4Demetrio v. SakumaBros. Farms, Inc., 

### No. 90932-6 Doc. 44, at 1-2 (Order Granting in Part Stipulated Mot. regarding Certified Questions to Wash. Supreme Ct.). ANALYSIS We answer certified questions de novo and in light ofthe federal courtrecord. Frias v. AssetForeclosure Servs., Inc., 

### 181 Wn.2d 412, 420, 334 P.3d 529 (2014). First Certified Question Though Sakuma and the Workers dispute the resolution ofthe first certified question-whetherpay separate from the piece rate is owed to pieceworkers for rest breaks-they agree on several points. They agree that employers must provide rest breaksto agricultural employees. They agreethatagricultural employees are entitled to some form ofpayment for those breaks. And, guiding the analysis here, they agree that to answer the question we must interpret WAC 296-131-020. The Department ofLabor and Industries adopted that regulation in 1990, yet in 25 years
no Washington courthas defined its scope or applieditto workerspaidby piece rate. We interpret regulations using the same rules we use to interpret statutes. First, we examine the plain language of the regulation; if that language is unambiguous it controls. Silverstreak, Inc. v. Dep 't of Labor & Indus., 

### 159 Wn.2d 868, 881, 154 P.3d 891 (2007). Language is unambiguous if it has only one reasonable 

### interpretation. Cerrillo v. Esparza, 

### 158 Wn.2d 194, 201, 142 P.3d 155



### 5

### Demetrio v. Sakuma Bros. Farms, Inc., No. 90932-6 (2006). The regulation at issue, WAC 296-131-020(2), applies only to agricultural employees and provides: Every employee shall be allowed a rest period ofat least ten minutes, on the employer's time, in each four-hour period of employment. For purposes of computing the minimum wage on a piecework basis, the time allotted an employee for restperiods shall be included in the number ofhours for which the minimum wage must be paid. The focus ofmost ofthe parties' and amici's attention is on the meaning of "on the employer's time." The plain and ordinary meaning ofthis phrase is clear: employers must pay agricultural employees during their 1 0-minute breaks. And when applied to pieceworkers, the only reasonable interpretation is that "on the employer's time" requires pay separate from the piece rate. Since the piece rate is earned only while the employee is working (i.e., no pay accrues during rest breaks) the Workers' rest breaks cannot reasonably be said to be "on the employer's time" ifpaid by the piece. The only way to give meaning to the phrase in this context is to require compensation separate from the piece rate for rest breaks. While Sakuma's suggestionthatWAC 296-131-020(2) allows an all-inclusive piecerate is perhaps a conceivable interpretation ofthe regulation, it 

### is not a reasonable one. Cerrillo, 158 Wn.2d at 201 (holding, "'a statute is not ambiguous merely because different interpretations are conceivable"' (internal quotation marks omitted) (quoting AgrilinkFoods, Inc. v. Dep't of Revenue, 153 Wn.2d 392, 396, 103 P.3d 1226 (2005))).
6Demetrio v. Sakuma Bros. Farms, Inc., No. 90932-6 Yet even ifWAC 296-131-020(2) were ambiguous, weresolve ambiguities in ways that "further, not frustrate, the[] intended purpose" ofthe regulation. Bostain
v. FoodExpress, Inc., 159 Wn.2d 700, 712, 153 P.3d 846 (2007) (quotingBurnside
v. Simpson Paper Co., 123 Wn.2d 93, 99, 864 P.3d 937 (1994)). Sakuma's interpretation permitting an all-inclusive piece rate conflicts with over a decade of
case law interpreting a similarrest breakregulation. We have previously considered the phrase "on the employer's time" as it appears in a different regulation. Rest breaks for nonagricultural employees are governed by WAC 296-126-092, which also "allow[s] a rest period ofnot less than ten minutes, on the employer's time, for each four hours ofworking time." WAC 296-126-092(4). The Department expressly patterned WAC 296-131-020(2)'s rest breakprovision for agricultural employees onWAC 296-126-092(4). Since WAC 296-131-020(2) was patterned on WAC 296-126-092( 4), our previous interpretations ofthe latterregulation are useful. We first interpretedWAC 296-126-092(4) and "onthe employer'stime" in Wingert v. Yellow FreightSystems, Inc., 146 Wn.2d 841, 50 P.3d 256 (2002). There we applied the regulation to a collective bargaining agreementthat provided a 15-minute break after two hours of overtime work. Ifemployees worked less thantwo hours ofovertime, theyreceived
no break. At issue was the employer's practice ofexcusing employeesjustbefore

7

### Demetrio v. Sakuma Bros. Farms, Inc., No. 90932-6 two hours ofovertime, requiring those employees to work continuously nearly four hours between their afternoon break and the end oftheir workday. 

### Id. at 845-46. We held WAC 296-126-092 prohibited employees from working three hours uninterruptedwithoutabreak,1evenifthe employeewas receiving overtimepayand notwithstanding a conflicting break provision in the employees' collective bargaining agreement. The employer's alternate accommodation-overtime pay and a different break schedule-was not a substitute for the policy advancedby the rest break regulation, namely that "employees [are] afforded healthy working conditions and adequate wages." 

### Id. at 852. Any practice that "decrease[s] the frequency ofworker's rest periods
... thwart[s] that fundamental purpose."

### Id. Tenyears after 

### Wingert, we again interpreted WAC 296-126-092(4) in a way that protected workers' rights. 

### Wash. State Nurses Ass 'n v. Sacred Heart Med. Center, 175 Wn.2d 822, 287 P.3d 516 (2012). The employer in that case often required employees to work through rest breaks during their eight-hour shifts. Although the employer would pay employees for missed rest breaks, it did not pay overtime, since the employees were never onthe employer's premises for morethan eight hours. Citing WAC 296-126-092(4), the MWA and "considerations of employeehealth," we requiredthe employerto compensatemissedrestbreaks atthe

1 WAC 296-126-092(4) provides, "Employees shall be allowed a rest period ofnot less than ten minutes, on the employer's time, for each four hours ofworking time
.... No employee shall be required to work more than three hours without arest period." 8

### Demetrio v. Sakuma Bros. Farms, Inc., No. 90932-6 overtime rate. 

### Id. at 832. We reasoned that any other interpretation created an economic incentive for employers to encourage employees to skip breaks, a result contrary to the intent ofWAC 296-126-092 and the 

### MWA.Id. The Court of Appeals has similarly interpreted WAC 296-126-092(4) to protect the effectiveness ofrest breaks. Specifically, Division One held that the regulation "imposes a mandatory obligation on the employer" to provide a paid rest break "'on the employer's time."' 

### Pellino v. Brink's Inc., 164 Wn. App. 668, 688, 267 P.3d 383 (2011) (quoting WAC 296-126-092(4)). It 

### is not enough for an employerto simply scheduletime throughoutthe day during which an employee can take a break ifhe or she chooses. Instead, employers must affirmatively promote meaningful break 

### time.Id. at 691 (quoting 

### White v. SalvationArmy, 118 Wn. App. 272, 283, 75 P.3d 990 (2003)). A workplace culture that encourages employees to skip breaks violates WAC 296-126-092 because it deprives employees ofthebenefit ofa rest break "onthe employer's time." 

### Id. at 679. Although these three 

### cases-Wingert, Sacred Heart, and 

### Pellino-applied restbreakspaid "onthe employer'stime" to hourlyworkers, they guide ouranalysis. More than establishingblanketrules, each ofthose courts lookedto the purpose rest breaks serve in light ofhow rest breaks were used (or not) by the employees in context. Both parties here agree that rest breaks are critical to the health and effectiveness ofemployees, especially those working long hours outside. Amicus


### 9

### Demetrio v. Sakuma Bros. Farms, Inc., No. 90932-6 reports that agriculture is one ofthe most dangerous industries in America, inflicting its workers with high rates ofrepetitive and environmental injuries. Rest breaks mitigate these dangers by allowing employees to sit, cool down, and rehydrate, and
we interpret rest breakregulations to further thatrecuperative purpose. Wingert, for example, held that employees cannot bargain away time for rest, even in exchange for additional pay. And Sacred Heart and Pellino reject payment schemes that incentivize missed rest breaks at the expense ofthe employee's health. Those principles support interpreting "onthe employer's time" in WAC 296- 131-020(2) to require rest break pay separate from the piece rate. Sakuma argues WAC 296-131-020(2) permits an all-inclusive piece rate because "the system incentivizes employees by awarding harder-working and more productiye workers with greater earnings." SakumaBros. Farms, Inc.'sResp. Br. on Certified Questions at 25-26. This appears a tacit admission that the current piece rate scheme encourages employees to "work harder" by skipping breaks. That result conflicts with all three ofthe cases discussed above: it effectively decreases the frequency of employees' rest periods; it incentivizes Sakuma to employ fewer employees; and it fosters a culture ofworking through breaks. See Wingert, 146 Wn.2d at 852; Sacred Heart, 175 Wn.2d at 832; Pellino, 164 Wn. App. at 679. Sakuma's interpretation is not only inconsistentwiththe plain language ofWAC 296-131-020(2), 

### itis contrary to the regulation's basic purpose.
10Demetrio v. SakumaBros. Farms, Inc., No. 90932-6 In sum, we answer the first certified question yes. Following from the plain language of WAC 296-131-020(2), and consistent with case law interpreting Washington's long-standing laborpolicy, employers mustpay a wage separate from the piece rate for time spent on rest breaks. Given the posture ofthis case and the settlement agreementreleasing the Workers' claims for retrospective relief, we take
nopositionontheretroactivityofthisrule. SeeRuiz-Guzmanv. Amvac Chern. Corp., 141 Wn.2d 493, 508, 7 P.3d 795 (2000) ("In answering federal certified questions,
we do not seekto make broad statements outside ofthe narrow questions andrecord before us."). Second Certified Question Next the federal district court asks us how "Washington agricultural employers calculate the rate ofpay for the rest break time" for pieceworkers. Doc. 44, at 2 (Order Granting in Part Stipulated Mot. regarding Certified Questions to Wash. Supreme Ct.). The parties differ in their proposed answers to this question. The Workers argue for the employee's average piece rate earnings. They would have employers convertthe piece rate by dividingthe employee's weeklypiece rate earnings bythe number ofhours the employee worked, exclusive ofrestbreaktime, and pay rest breaks at that de facto hourly rate (the employee's "regular rate"). Sakuma argues Washington law requires only the minimum wage per hour for pieceworkers, though it admits paying rest breaks for its hourly employees at the

11Demetrio v. Sakuma Bros. Farms, Inc., 

### No. 90932-6 employees' hourly rate. WAC 296-131-020(2) is silent about the rate ofpay required for employee rest breaks, whether paid by the piece or otherwise. Ofcourse the starting point for the calculation is the applicable minimum wage. The MW A "sets the floor below which the agreedrate cannot fall withoutviolating the statute." Seattle Prof'lEng'g Emps. Ass 'n v. Boeing Co., 

### 139 Wn.2d 824, 835, 991 P.2d 1126, 1P.3d 578 (2000) (SPEEA) 

### (citing ch. 49.46 RCW). 2 

### The second sentence ofWAC 296-131-020(2) references the MWA's floor by ensuring the quotient ofan employee's piece rate earnings by the number ofhours he or she worked, inclusive ofthe time spent on rest breaks, is at least the minimum wage.3 

### Ifthis de facto hourly rate falls below

2 Sakuma cites SPEEA to argue that separate pay for restbreaks is capped at the minimum wage. But SPEEA is a case about contracts, not regulatory interpretation, and it has little application here. There an employer required new employees to attend unpaid preemployment orientation sessions. This practice was embodied in written employment contracts in which employees agreed (1) that their attendance at orientation would be unpaid, and (2) that the terms ofemployment, including salary, wouldbegin after orientation. The employees sued, arguingthey were owed wages for attending these orientations, paid as a pro rata portion oftheir contractual salary. SPEEA, 139 Wn.2d at 833-34. We agreed wages were due but limited the employees' recovery to the minimum wage basedon the employment contracts they signed. Those contracts "contain[ed] fixed starting dates for employmentthatexcludedthemandatorypreemploymentorientation sessions," andundertheir terms the employees were owed their salaries only after orientation. Id. at 833. Since we lack authorityto rewrite contracts, we heldthe contracts expresslyprohibitedthe remedythe employees sought. Id. at 833-34. We therefore fell back to the MWA as the measure ofdamages. There are no contradictory written contracts in the record before us. Thus SPEEA applies in this instance only for the uncontestedpropositionthat employers mustpay at leastthe minimum wage. The minimum wage is a floor, not a ceiling. That is why the minimum wage is only a starting point when construing what WAC 296-131-020(2) requires. 3 An example demonstrates this calculation in practice. Suppose an employee is paid 50 cents per pound offruit picked (the piece rate). The employee works five eight-hour days and takes 20 minutes ofrest breaks each day, as provided by WAC 296-131-020(2). The employee


### 12

### Demetrio v. Sakuma Bros. Farms, Inc., No. 90932-6 the minimumwage, the employermustbringup the employee'spaytothe minimum. Like every employer ofpiece rate workers, Sakuma already performs this minimum wage calculation. As discussed earlier, however, a pieceworker's right to separate pay for rest breaks springs not from the MWA butrather from WAC 296-131-020(2)'s mandate that rest breaks be paid "on the employer's time." That phrase also appears in the nonagricultural rest break regulation, which we have consistently found to require equal treatment of every hour worked. For instance, we found no distinction "between regular and overtime hours worked" and held employees were entitled to rest breaks "onthe employer's time" ifthey worked ''regularhours, overtime hours,
or a combination of both." Wingert, 146 Wn.2d at 848 (citing WAC 296-126- 092(4)). We also recognized that "rest periods constitute 'hours worked'" and held that for the purposes ofcomputing overtime, hours spentresting are treatedthe same
as hours spent working. Sacred Heart, 175 Wn.2d at 831. In other words, under WAC 296-126-092(4) all hours worked contribute equally to the employee's right to a rest break and there is no basis to treat the rate paid for rest breaks "on the employer's time" differently from the rate paid for other hours worked.

has spent 38.6hoursproducing and 1.4 hours onbreaks, for 40 hours oftotal work. Ifthe employee produces 750 pounds offruit, he or she earns $375.00 that week. Thus, the employer divides the employee's total piecerate earnings ($375.00) by 40 hours, which equals only $9.38 perhour. The employer must increase the worker's total piece rate earnings to meet the $9.47 state minimum wage, ifthat is the highest applicable minimum wage in the locality. 

### 13

### Demetrio v. Sakuma Bros. Farms, Inc., No. 90932-6 Nothing in WAC 296-131-020(2) suggests "on the employer's time" means somethingdifferentto agriculturalworkers generallyortopieceworkers specifically. In fact, the regulation is entirely consistent with our prior interpretations of"on the employer's time" when a pieceworker's average earnings are less than or equal to the minimum wage. Time spent on rest breaks and time spent in active work are both hours worked for the employer and, under the second sentence ofWAC 296- 131-020(2), are

### paidat the same rate (the minimum wage). We find no reason to depart from this interpretationwhen apieceworker's average earnings are more than the minimum wage. Paying pieceworkers only the minimum wage for rest breaks and ahigherrate for active laborresults inthe sameparsing ofhours worked "onthe employer's time" that we rejected in 

### Wingert and 

### SacredHeart. Because all hours worked "on the employer's time" are treated equally, we holdthat WAC 296-131-020(2) entitles pieceworkers to their regular rate ofpay for rest breaktime. To calculate a pieceworker's regular rate, employers againtally the total piece rate earnings and divide those earnings by the hours the pieceworker worked, but here the divisor excludes time spent resting. 4 This formula results in the average rate ofpaypieceworkers earn during activeproduction (i.e., theirregular rate) and prevents rest breaktime from being double counted. Itis also the formula

4 In the previous example, the employee's regular rate is $9.72 per hour that pay period. This results from dividing $375.00 (total piece rate earnings) by 38.6 hours (total hours in active production, exclusive ofbreaktime). 14Demetrio v. Sakuma Bros. Farms, Inc., 

### No. 90932-6 that Sakuma uses to pay pieceworkers for missed rest breaks, since "it is time [the employees] have already spent" working. Wash. Supreme Court oral argument, Demetrio v. SakumaBros. Farms, 

### No. 90932-6 (Mar. 17, 2015), at 34 min., 26 sec., audio recording 

### by TVW, Washington State's Public Affairs Network, available at 

### http://www.tvw.org. We agree with Sakuma that missed breaks must be compensated at the pieceworker's regular rate. And we see no reason to treat missed rest breaks differently from rest breaks provided. The pieceworker's right to a paid breakwhether taken or not-follows from the same regulatory language: "on the employer's time." It

### would be inconsistentto interpretthatphraseto meanpayment at the employee's regular rate in one instance and merely the minimum wage in another. Consistency is especially important here to ensure efficient employees are notpenalized for taking rest breaks. If

### rest breaks are compensated at a lower wage than the pieceworker's regular rate, there is a strong incentive to miss rest breaks. Thatresult frustrates the entire purpose ofWAC 296-131-020(2). See SacredHeart, 

### 175 Wn.2d at 832. Thus we answerthe second certified question: WAC 296-131-020(2)requires that rest breaktime be compensated at the pieceworker's regular rate ofpay. 5

5We recognize that the rate at which rest breaks are paid might be the subject ofvoluntary bargaining between an employer and employee, and this opinion does not impair the ability of


### 15Demetrio v. Sakuma Bros. Farms, Inc., No. 90932-6 CONCLUSION We answer the first certified question yes. Pay for rest breaks separate from the piece rate follows from the plain language of WAC 296-131-020(2) and is consistentwithWashington case law interpreting restbreakregulations. We answer the second certified question: in the absence ofa separate agreement, pay separate from the piece rate must equal at least the applicable minimum wage or the pieceworker's regular rate ofpay, whichever is greater. The Workers' attorney fee request should be directed to the federal district court ifthat court enters ajudgment in their favor, and therefore the request is denied withoutprejudice.

parties to contract within the scope ofthe law. For example, it is conceivable that an employer and employee could agree to rest breakpayat ahigher rate than the employee'sregularrate. 16Demetrio v. Sakuma Bros. Farms, Inc., No. 90932-6

WE CONCUR:

# -~~#'--**-VI~** 1!7 /

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