CA) 

CD 

720. 

--;g• 

• • 

CJI 

CI 

IN THE COURT OF APPEALS FOR THE STATE OF WASHINGTON 

RACHELLE HONEYCUTT and ) 

GABRIEL WESTERGREEN, ) 

) 

Appellants, ) 

) 

V. ) 

) 

WASHINGTON STATE, DEPARTMENT) 

OF LABOR & INDUSTRIES, ) 

) 

Respondents, ) 

and ) 

PHILLIPS 66 COMPANY, 

Intervenors. 

No. 74338-4-1 

DIVISION ONE 

PUBLISHED OPINION 

FILED: January 30, 2017 

SPEARMAN, J. —The family care act (FCA), chapter 49.12 RCW, does not 

require employers to provide paid leave. But where an employer provides paid 

leave for an employee's own use, the FCA mandates that the employee may use 

that leave to care for an eligible family member. RCW 49.12.270. If more than 

one type of leave is available, the employee may choose which type of "sick 

leave or other paid time off" to use for family care. RCW 49.12.270(1). When an 

employee takes time off to care for a sick family member and the employer does 

not allow paid time off "for illness," the FCA allows the employee to access paid 

leave provided through a disability plan. RCW 49.12.265(5). Disability plans 
No. 74338-4-1/2 

maintained through insurance or governed by the employee security retirement 

income security act of 1974 (ERISA)1 are exempt from this provision of the FCA. 

Id. 

We are asked to decide whether, in the context of the FCA, time allowed 

to an employee "for illness" is the equivalent of "sick leave." We conclude that it 

is and reverse the Department of Labor & Industries' (Department) ruling to the 

contrary. We remand for a determination of whether Phillips 66 Company's 

disability plan is exempt from the FCA because it is maintained through 

insurance or governed by ERISA. 

FACTS 

Phillips 66 does not provide sick leave. When employees of Phillips 66 

miss work due to illness, they may receive paid time off through a short term 

disability (STD) plan. The STD plan functions much like traditional sick leave. To 

use STD benefits, an employee notifies a supervisor within twenty-four hours of 

an absence due to illness or injury. If such an absence lasts five or more days, 

the employee must provide a medical certificate. Based on the length of time an 

employee has worked for Phillips 66, the STD plan provides full pay for one to 

twenty-six weeks and sixty percent pay for the remaining weeks in a calendar 

year. STD benefits are reduced by any state mandated sick pay the employee is 

eligible to receive. 

Under a collective bargaining agreement (CBA), Phillips 66 also provides 

employees with two paid personal holidays each year and a number of paid 

I 29 U.S.C. §1001 et seq. 

2 
No. 74338-4-1/3 

vacation days based on the length of time the employee has worked for the 

company. Employees bid for specific vacation days each fall for the subsequent 

calendar year. Vacation days are provided for the purpose of "rest and 

recreation." Clerk's Papers (CP) at 315. However, Phillips 66 permits employees 

to use vacation days or personal holidays instead of STD benefits when they 

miss work due to illness. 

When an employee takes time off to care for a sick family member, the 

company allows the employee to use any available personal or vacation days. 

Phillips 66 does not allow employees to use STD benefits to care for a family 

member. 

Rachelle Honeycutt and Daniel Westergreen work at a refinery operated 

by Phillips 66. In 2013, Honeycutt and Westergreen ("Honeycutt" or "the 

employees") both requested leave from work to care for sick family members. 

Phillips 66 approved the absences and gave the employees the option of using 

vacation days or taking time off without pay. The employees took time off without 

pay because they had already bid for vacation slots and made plans for those 

days. 

The employees contacted their union, United Steelworkers Local 12-590. 

The union demanded that the company allow employees to access STD benefits 

to care for sick family members as required by the FCA. Phillips 66 took the 

position that its STD plan is an ERISA plan to which the FCA does not 'apply. 

Honeycutt filed a complaint with the Department of Labor & Industries. 

The Department determined that Phillips 66 did not violate the FCA. The 

3 
No. 74338-4-114 

Department concluded that the FCA only reaches a disability plan if that plan is 

the only means by which an employee may receive paid leave for illness. 

Because Phillips 66's employees may use vacation days for illness, the 

Department ruled that the FCA's provision for reaching disability plans did not 

apply. The Department did not rule on whether Philips 66's STD plan was 

governed by ERISA. 

An administrative law judge (AU) affirmed the Department's decision.2 

The All did not rule on whether Phillips 66's STD plan was exempt from ERISA. 

The director of the Department adopted the AL's findings of fact and 

conclusions of law and affirmed the ruling. The employees appealed to Whatcom 

County Superior Court, which also affirmed the Department's decision. Honeycutt 

appealed to this court. 

DISCUSSION 

The Administrative Procedure Act (APA), chapter 34.05 RCW, governs 

judicial review of final agency decisions. RCW 34.05.070. In reviewing an agency 

decision, we sit in the same position as the superior court. Darkenwald v. Emp't 

Sec. Dep't, 183 Wn.2d 237, 244, 350 P.3d 647 (2015) (citing Verizon Nw., Inc. v. 

Emp't Sec. Dep't, 164 Wn.2d 909, 915, 194 P.3d 255 (2008)). We review the 

final agency decision and apply APA standards directly to the record that was 

2The AU supported its ruling with slightly different reasoning than the Department. In its 

determination of compliance, the Department reasoned that the FCA did not reach Phillips 66's 

STD plan because the company allows employees to use vacation days for their own illness. The 

AU reasoned that the FCA does not reach the company's STD plan because the employees 

could have used vacation days to care for a sick family member. 

4 
No. 74338-4-1/5 

before the agency. Id. An agency's action is invalid if the agency interpreted or 

applied the law erroneously. RCW 34.05.570(3)(d). 

The parties dispute the interpretation of RCW 49.12.265(5), which defines 

"sick leave or other paid time off' for purposes of the FCA. The meaning of a 

statute is a question of law that we review de novo. Dep't of Ecology v. Campbell 

& Gwinn, LLC, 146 Wn.2d 1, 9, 43 P.3d 4 (2002) (citing State v. Breazeale, 144 

Wn.2d 829, 837, 31 P.3d 1155 (2001)). 

Our primary duty in interpreting a statute is to "discern and implement the 

intent of the legislature." State v. J.P., 149 Wn.2d 444, 450, 69 P.3d 318 (2003) 

(citing Nat'l Elec. Contractors Ass'n v. Riveland, 138 Wn.2d 9, 19, 978 P.2d 481 

(1999)). We begin with the statute's plain meaning. Id. We discern plain meaning 

from the ordinary meaning of the language, related provisions in the statute, and 

the statutory scheme as a whole. Id. (citing Dep't of Ecology, 146 Wn.2d at 11). A 

statute is unambiguous where the plain language is susceptible to only one 

reasonable reading. J.P., 149 Wn.2d at 450 (citing State v. Wilson, 125 Wn.2d 

212, 217, 883 P.2d 320 (1994)). We do not accord deference to an agency's 

interpretation of an unambiguous statute. Edelman v. State ex rel. Public 

Disclosure Com'n, 152 Wn.2d 584, 590, 99 P.3d 386 (2004). 

Under the 1988 family care act, RCW 49.12.265-295, when an employer 

provides paid time off for an employee's own use, the employee may use that 

leave to care for an eligible family member. RCW 49.12.270. If more than one 

type of paid time off is available, the employee may choose which type of "sick 

leave or other paid time off' to use for family care: 

5 
No. 74338-4-1/6 

If, under the terms of a collective bargaining agreement or 

employer policy applicable to an employee, the employee is entitled 

to sick leave or other paid time off, then an employer shall allow an 

employee to use any or all of the employee's choice of sick leave or 

other paid time off to care for ... [an eligible family member]. 

RCW 49.12.270(1) (emphasis added). 

In 2002, the legislature defined "[s]ick leave or other paid time off' as "time 

allowed ... to an employee for illness, vacation, and personal holiday." Former 

RCW 49.12.265(5) (2002). As part of a 2005 amendment, the legislature added a 

second sentence to this definition. The second sentence adds self-funded 

disability plans to the definition of "sick leave or other paid time off" when an 

employer does not allow paid time off "for illness." RCW 49.12.265(5). As 

amended, the definition statute provides that: 

111"Sick leave or other paid time off" means time allowed under the 

terms of an appropriate state law, collective bargaining agreement, 

or employer policy, as applicable, to an employee for illness, 

vacation, and personal holiday. [2] If paid time is not allowed to an 

employee for illness, "sick leave or other paid time off' also means 

time allowed under the terms of an appropriate state law, collective 

bargaining agreement, or employer policy, as applicable, to an 

employee for disability under a plan, fund, program, or practice that 

is: (a) Not covered by the employee retirement income security act 

of 1974, 29 U.S.C. Sec. 1001 et seq.; and (b) not established or 

maintained through the purchase of insurance. 

RCW 49.12.265(5) (emphasis added). 

The definition statute refers to time "allowed" or "not allowed" to an 

employee "for illness" in the first and the second sentences, respectively. The 

parties agree that the term "for illness" has the same meaning in both sentences. 

But because they disagree on what that meaning is, they dispute when the 

second sentence applies. 

6 
No. 74338-4-1/7 

Honeycutt asserts that time allowed "for illness" is paid time off specifically 

for the purpose of illness. She contends that the first sentence of the statute lists 

three categories of paid leave: time allowed for illness, time allowed for vacation, 

and time allowed for personal holiday. According to Honeycutt, because the 

second sentence expressly refers to only one of these categories, time allowed 

for illness, the second sentence applies when that category of leave is not 

available. Under this reading, the FCA's provision concerning disability plans 

applies when an employer does not provide paid leave specifically for the 

purpose of illness, i.e., sick leave. 3 

The Department and Phillips 66 assert that any type of leave employees 

may access when they miss work due to illness is paid time off "for illness." They 

contend that in referring to paid time off for "illness, vacation, and personal 

holiday," the first sentence of the definition statute lists three interchangeable 

examples of types of time off that may be used "for illness." Under this reading, 

the second sentence of the statute only applies if disability is the only type of 

leave employees may use when they miss work due to illness. In this case, 

because employees may use vacation days or personal holidays when they are 

ill, the Department and Phillips 66 contend that the FCA's provision concerning 

disability plans does not apply. 

We agree with Honeycutt. By the plain language of the statute, the FCA 

reaches three categories of paid time off: time off for illness, time off for vacation, 

3Friends of the court Legal Voice, Economic Opportunity Institute, and Washington State 

Labor Council, AFL-CIO support this interpretation in their joint brief. 
No. 74338-4-1/8 

and time off for personal holiday. The second sentence of RCW 49.12.265(5) 

applies when an employer does not provide one of these listed categories, paid 

time off for illness. 

To argue against this result, the Department and Phillips 66 focus on the 

word "allowed" in the statutory definition. But they misconstrue the word's 

meaning in the context of the statute. They argue that the ordinary meaning of 

"allow" is "permit," which indicates permission or discretion. The Department 

contends that by using the word "allowed" the statute signals that the proper 

inquiry is whether an employer permits employees to use paid personal or 

vacation time for the purpose of illness. The Department relies on Webster's 

Dictionary, which lists "permit" as one definition of "allow." WEBSTER'S THIRD NEW 

INTERNATIONAL DICTIONARY 58 (2002). This reliance is misplaced. 

The statute defines "sick leave or other paid time off" as "time allowed 

under the terms of an appropriate state law, collective bargaining agreement, or 

employer policy, as applicable, to an employee for illness, vacation, and personal 

holiday." RCW 49.12.265(5). In this context, "allowed" does not indicate 

discretion. Paid time off for the specific listed purposes is a benefit that the 

employee receives as a matter of right pursuant to an agreement, law, or policy. 

This meaning is emphasized in RCW 49.12.270, which states that an employee 

may use his or her choice of any sick leave or other paid time off to which the 

employee is "entitled." 

As used in the statute, "allow" has the second meaning listed by 

Webster's: "to give or recognize as a right ... to give or assign as a share or 

8 
No. 74338-4-119 

suitable amount (as of time or money) to a particular person or for a particular 

purpose." WEBSTER'S THIRD NEW INTERNATIONAL DICTIONARY 58 (2002). Applying 

this meaning to the statute, paid time "allowed ... to an employee for illness" is 

paid time off granted under an agreement or policy for absences from work due 

to illness. The provision for reaching disability plans applies "[i]f paid time is not 

allowed to an employee for illness." RCW 49.12.265(5). 

We conclude that RCW 49.12.265(5) is not reasonably susceptible to the 

interpretation proposed by the Department. The provision for reaching disability 

plans in the second sentence of the statute unambiguously applies if an 

employer does not provide paid time off for the purpose of illness, commonly 

referred to as sick leave. 

But even if the statute is ambiguous, legislative history compels the same 

conclusion. When a statute is ambiguous, we consider "other indicia of legislative 

intent," including legislative history, to resolve the ambiguity. Bostain v. Food 

Express, Inc., 159 Wn.2d 700, 708, 153 P.3d 846 (2007). We may consider 

sequential versions of a bill as indicia of legislative intent. Lewis v. Dep't of 

Licensing, 157 Wn.2d 446, 470, 139 P.3d 1078 (2006) (citing State v. Martin, 94 

Wn.2d 1, 19, 614 P.2d 164 (1980)). We accord deference to an agency 

interpretation of an ambiguous statute that is within the agency's area of 

expertise. Bostain, 159 Wn.2d at 716. But we accord no deference to an 

interpretation that is inconsistent with a statutory mandate. Id. at 716-17 (citing 

Cockle v. Dep't of Labor & Indus., 142 Wn.2d 801, 812,16 P.3d 583 (2001)). 

9 
No. 74338-4-1/10 

The legislature considered four successive versions of the 2005 

amendment to RCW 49.12.265(5). S.B. 5850, 59th Leg., Reg. Sess. (Wash. 

2005); SUBSTITUTE S.B. 5850, 59th Leg., Reg. Sess. (Wash. 2005); SUBSTITUTE 

S.B. 5850 HOUSE COMM AMD, 59th Leg., Reg. Sess. (Wash. 2005); SUBSTITUTE 

S.B. 5850 HOUSE AMD, 59th Leg., Reg. Sess. (Wash. 2005). The text of each 

version, comments to the text, and the Senate and House Bill Reports all indicate 

the intent to reach self-funded disability plans when an employer does not 

provide sick leave. 

The Senate Bill Report for S.B. 5850 summarizes the proposed legislation 

by stating that "[t]he definition of 'sick leave or other paid time off must include 

any self-administered short-term or long-term disability plan unless the employer 

maintains a separate paid sick leave plan or practice." S.B. Rep. on S.B. 5850, 

59th Leg., Reg. Sess. (Wash. 2005). The report includes testimony explaining 

that: 

[for a number of employees, their principal sick leave plan is 

called a disability plan and as a result some employers will not 

allow employees to use accrued time under the disability plan to 

care for a sick child or family member.. . . Some employers call 

their sick leave plan a disability plan and are able to avoid the 

intent of the family care act and this bill would not allow them to 

do that anymore. 

Id. The next version of the bill, Substitute Senate Bill 5850, states that "sick leave 

or other paid time off' includes self-administered disability plans unless the 

employer maintains a separate 'bona fide paid sick leave policy'.. ." SUBSTITUTE 

S.B. 5850, 59th Leg., Reg. Sess. (Wash. 2005). The Senate Bill Report for this 

10 
No. 74338-4-1/11 

version includes the same summary and testimony as the previous report. S.B. 

REP. on SUBSTITUTE S.B. 5850, 59th Leg., Reg. Sess. (Wash. 2005). 

The first House amendment states that the FCA reaches a disability plan 

"[i]f paid time is not allowed to an employee for illness. . . ." SUBSTITUTE S.B. 

5850, HOUSE COMM AMD, 59th Leg., Reg. Sess. (Wash. 2005). The amendment 

expressly excludes disability plans governed by ERISA but does not address 

disability plans maintained through insurance. Id. The House Bill Report for this 

version states that the amended bill differs from the substitute bill in that it 

modifies the definition of "sick leave or other paid time off" to include "time 

allowed . . . to an employee for disability" under a non-ERISA disability plan "if 

the employee does not have paid sick leave. . . ." H.B. REP. on SUBSTITUTE S.B. 

5850 HOUSE COMM AMD, 59th Leg., Reg. Sess. (Wash. 2005). 

The final, successful, version of the bill was proposed as a House floor 

amendment. SUBSTITUTE S.B. 5850 H AMD, 59th Leg., Reg. Sess. (Wash. 2005). 

The text of the proposed legislation includes a comment stating that the 

amendment "[c]larifies that, if an employee does not have paid sick leave, the 

employee may use disability leave" provided the disability leave is not governed 

by ERISA or maintained through insurance. j.çj. In addition, the Senate Bill Report 

summarizes the House amendments. S.B. REP. ON S.S.B. 5850, 59th Leg., Reg. 

Sess. (Wash. 2005). The report states that both House amendments "clarify that 

if an employee does not have paid sick leave, the employee may use disability 

leave not covered by ERISA to care for ill family members." Id. 

11 
No. 74338-4-1/12 

The Department argues that by rejecting Substitute S.B. 5850, which 

specified that the FCA reached disability plans unless the employer maintained a 

"bona fide paid sick leave policy," the legislature declined to link sick leave and 

disability benefits and demonstrated an intent to only reach disability benefits 

when an employee has no other paid leave. This argument is without merit. The 

legislative history consistently demonstrates the intent to include self-funded 

disability plans in the definition of "sick leave or other paid time off when an 

employer offers such a plan instead of sick leave. 

Phillips 66 next relies on the legislature's statement of findings. In passing 

the 1988 FCA, the legislature stated that it was "in the public interest for 

employers to accommodate employees by providing reasonable leaves from 

work for family reasons." Legislative Findings-1988, c 236 § 1. Phillips 66 

focuses on the word "reasonable." Phillips 66 Brief at 16, 29-30. The company 

asserts that its STD plan provides up to 52 weeks of paid leave and argues that it 

is not reasonable to allow employees to access these benefits to care for an ill 

family member while saving their vacation time. We reject this argument. The 

legislature created a statutory definition for leaves that are within the FCA. The 

FCA does not authorize the Department to analyze leave policies on ,a case by 

case basis for reasonableness. 

Finally, the Department argues that its regulations properly explain that 

the statute only reaches disability plans if an employee is prohibited from using 

other leave for illness. The Department promulgated regulations interpreting the 

FCA. Chapter 296-130 WAC. The regulations affirm an employee's right to use 

12 
No. 74338-4-1/13 

his or her choice of "sick leave or other paid time off' to care for an eligible family 

member. WAC 296-130-030(1). A note following WAC 296-130-030 explains that 

many employers combine categories of paid leave such as sick leave and 

vacation leave into one pool described as "'paid time off" or PTO. WAC 296-130-

030. The Note states that the practice of providing PTO is consistent with the 

intent for employees to use their choice of leave. Id. The Department concedes 

that Phillips 66 does not offer PTO, but argues that the company's policy of 

allowing employees to use vacation time for illness is similar to a PTO plan. We 

reject this argument. 

In a PTO, all of an employee's paid time off is available in one pool for the 

employee's own use. An employee may access any or all of this time off under 

the FCA. Phillips 66's practice of providing benefits under an STD plan, but 

restricting these benefits to an employee's own illness, is not analogous. As the 

Department's Note goes on to explain, the key to compliance with the FCA is that 

any leave available for an employee's own health condition be available on the 

same terms to care for sick family member. WAC 296-130-030. 

The Department also relies on the regulatory definition of "sick leave or 

other paid time off." The Department's rule states that an eligible disability plan is 

within the FCA "[i]f paid time is not allowed to an employee for illness with a sick 

leave or pay benefit. . . ." WAC 296-130-020(8) (emphasis added). The 

Department argues that Phillips 66 provides a "pay benefit" for illness by allowing 

employees to access paid vacation time when they are sick. This argument is 

without merit. While it is unclear what the term "pay benefit" encompasses, the 

13 
No. 74338-4-1/14 

regulation includes the same use of "allow" as the statute. As in the statute, paid 

time off for illness refers to paid leave granted under the terms of an agreement 

for the purpose of illness. To the extent the Department's regulation propounds 

any other interpretation, we reject that interpretation as inconsistent with the 

statutory mandate. Bostain, 159 Wn.2d at 716-17 (citing Cockle, 142 Wn.2d at 

812). 

The Department erred in ruling that the FCA only reaches a disability plan 

if that plan is the only means by which an employee may be compensated for 

time off due to illness. By its plain language, RCW 49.12.265(5) is not 

susceptible to the interpretation propounded by the Department. But even if 

ambiguous, legislative history clearly indicates the intent to reach eligible 

disability plans when an employer does not provide sick leave. 

Because Phillips 66 does not provide sick leave, the FCA's provision for 

reaching disability plans applies. The next issue is whether Phillips 66's STD plan 

is exempt from the FCA because it is governed by ERISA or maintained through 

insurance. The Department made no findings on this issue. 

When an agency has not ruled on a relevant factual issue, we do not 

substitute our judgment for that of the agency by deciding the issue. Suguamish 

Tribe v. Central Puget Sound Growth Mgmt. Hearings Bd., 156 Wn. App. 743, 

778, 235 P.3d 812 (2010). Rather, we remand to the agency for a determination. 

Id. We may, however, substitute our judgment for that of the agency on purely 

legal issues that are not with the primary jurisdiction of the agency. Id. at 778-79. 

14 
WE CONCUR: 

:/Nlicit.sey - i A G.,1 

No. 74338-4-1/15 

Honeycutt urges this court to rule that Phillips 66's STD plan is within the 

FCA because it is not governed by ERISA or maintained by insurance. But 

because the ruling on this issue requires determinations of fact, we remand to 

the Department. 

Reversed and remanded. 

15