Opinion ID: 2507215
Heading Depth: 2
Heading Rank: 1

Heading: Does the amended version of WAC 296-128-035 apply retroactively?

Text: ¶ 11 Pursuant to the MWA, WAC 296-128-035 designates the time by which an employer must pay all wages due. [6] Champagne relies upon the rule as it existed at the time he filed his suit in September 2004. In its entirety, former WAC 296-128-035 provided: All wages due shall be paid at no longer than monthly intervals to each employee on established regular pay days. To facilitate bookkeeping, an employer may implement a regular payroll system in which wages from up to seven days before pay day may be withheld from the pay period covered and included in the next pay period. Champagne maintains that the County violated former WAC 296-128-035 since the County paid additional pay the month after it was earned. The County, however, urges the court to apply the amended WAC retroactively. ¶ 12 Current WAC 296-128-035 is similar to its former version but includes additional direction. The current WAC provision states, [a]n employer shall pay all wages owed to an employee on an established regular pay day at no longer than monthly payment intervals. WAC 296-128-035(3). The additional direction provides: An employer shall pay overtime wages owed to an employee on the regular pay day for the pay period in which the overtime wages were earned. If the correct amount of overtime wages cannot be determined until after such regular pay day, the employer may establish a separate pay day for overtime wages; provided, that the payment of overtime wages may not be delayed for a period longer than that which is reasonably necessary for the employer to compute and arrange for payment of the amount due, and overtime wages must be paid by the regular pay day following the next pay period. WAC 296-128-035(6). Furthermore, the rule may be superseded by a collective bargaining agreement subject to certain conditions. [7] WAC 296-128-035(8). ¶ 13 Champagne concedes that he lacks a cause of action under current WAC 296-128-035 given that sections six and eight would permit the month delay for additional pay. Therefore, the court must determine whether the former or current WAC provisions apply. In other words, is the amended language retroactive? ¶ 14 Generally, we presume prospective application of newly amended administrative regulations, particularly where the amendments change substantive rights. In re Pers. Restraint of Shepard, 127 Wash.2d 185, 193, 898 P.2d 828 (1995). However, courts may apply an amendment retroactively if either (1) the agency intended the amendment to apply retroactively, (2) the effect of the amendment is remedial or curative, or (3) the amendment serves to clarify the purpose of the existing rule. Magula v. Benton Franklin Title Co., 131 Wash.2d 171, 181-82, 930 P.2d 307 (1997); see also Letourneau v. Dep't of Licensing, 131 Wash.App. 657, 665-66, 128 P.3d 647 (2006) (applying the above guidelines to determine whether a WAC rule should apply retroactively). ¶ 15 Both parties acknowledge that [a] regulation may be given retroactive effect where its purpose is to clarify rather than change the law. Reply in Support of Pet. for Rev. at 11; Suppl. Br. of Resp't at 4 n. 2 (citing Magula, 131 Wash.2d at 182, 930 P.2d 307). However, Champagne urges the court to apply the amendments prospectively, arguing only that the amendments affect a substantive or vested right. Reply in Support of Pet. for Rev. at 11 (citing Letourneau, 131 Wash.App. at 665, 128 P.3d 647). ¶ 16 Thus, the issue is whether the rule revision affects a substantive or vested right. The proposed rule statement put forth by the Department of Labor and Industries suggests that the changes were intended to clarify rule language without changing its effect pursuant to RCW 34.05.310(4)(d). Wash. St. Reg. XX-XX-XXX. At first blush, this would seem to fit under the exception carved out in Magula. However, the actual effects of the amendments go beyond mere clarification. Current WAC 296-128-035(6) permits the payment of additional pay in intervals longer than one month. This practice would have violated the plain language of the previous rule and, thus, denotes a change in substantive rights. [8] Further, the effect of the amendment is not remedial, which similarly militates against retroactive application. Accordingly, we hold that amended WAC 296-128-035 applies prospectively only, and we will apply former WAC 296-128-035 as it existed when the complaint was filed in 2004.