Court Opinion

ID: 9851298
Source: CourtListenerOpinion
Date Created: 2023-09-24 05:10:15.640355+00
Date Added: 2024-06-11T09:20:53.153699
License: Public Domain

MYSE, J.
(dissenting). I dissent from the majority's conclusion that the term "wages" as used in sec. 103.455, Stats., does not encompass compensation received in the form of commissions. While the majority properly notes that this is a remedial statute that should be interpreted broadly, they do not give it such an interpretation. I am unpersuaded by the majority's reasons for concluding that the legislature did not intend to include commissions in its proscription against unilateral deductions by the employer from wages for faulty workmanship, loss, theft or damage. I reach the opposite conclusion for a variety of reasons.
*285First, I conclude that a broad interpretation of the term "wages" is appropriate. The legislature enacted sec. 103.445, Stats., to prohibit an employer from arbitrarily determining that it does not owe the employe compensation because it attributes losses to the employe's deficient performance. Donovan v. Schlesner, 72 Wis. 2d 74, 81, 240 N.W.2d 135, 139 (1976). The statute authorizes deductions only if it is determined after the loss that the loss resulted from the employe's negligence or intentional conduct. Id. Nothing in the statute indicates that income in any form is not entitled to this statutory protection. A significant segment of this state's population would be deprived of this protection if commissions were excluded from this legislatively created shield. The manner in which the income is calculated is irrelevant to the legislative purpose of this statute.
Second, I do not agree with the majority's conclusion that an individual receiving both a salary and commissions is not susceptible to the economic hardships resulting from an employer's arbitrary deduction that the legislature intended to prevent when it passed this statute. An employe earning commissions above a base salary at minimum wage levels is every bit as susceptible to the economic pressure from an employer's overreaching as an individual who is entirely dependent upon a salary for compensation.
Third, although the term "wages" is not expressly defined in ch. 103, Stats., an examination of related definitions in sec. 103.49 is instructive. Subsection (l)(b) defines "hourly basic rate" as "the hourly wage paid to any employe, excluding any contributions or payments for health and welfare benefits, vacation benefits, pension benefits and any other economic benefits, whether paid directly or indirectly." (Emphasis added.) Subsection (l)(d) defines "prevailing wage rate" as "the hourly *286basic rate paid plus the hourly contribution for health and welfare benefits, vacation benefits, pension benefits and any other economic benefit, whether paid directly or indirectly ..(Emphasis added.) Because these definitions include other economic benefits, I conclude that the legislature contemplated a broader definition of the term "wages" than the hourly rate or base salary paid to an employe.
Finally, I note that the definition of "wages" contained in sec. 109.01(3), Stats., specifically includes commissions. While this section was not in effect at the time the legislature adopted the protections in sec. 103.455, Stats., it was in effect in 1989 when the legislature last modified sec. 103.455. When the legislature enacts or amends a statute, it is presumed to have full knowledge of existing statutes. Wood v. American Family Mut. Ins. Co., 148 Wis. 2d 639, 646, 436 N.W.2d 594, 597 (1989).
In 1975, the legislature repealed sec. 101.21, Stats., and created sec. 109.01, Stats. When the legislature modified most of ch. 103, Stats., including sec. 103.455 in 1989, it is presumed to have known that sec. 109.01(3) contained a definition of "wages" that included commissions. Had the legislature intended a narrower definition of the term "wages" for purposes of applying sec. 103.455, it would have included such a definition in the revised ch. 103. In addition, the Legislative Reference Bureau's drafting division cross-referenced the definition of "wages" in sec. 109.01 in the notes following sec. 103.455. The cross-references are a part of the bill or amendment that the legislature considers before enacting or modifying a statute. The cross-references are considered along with the language of the bill. Cross-referencing definitions in other statutes is designed to eliminate confusion and the need for repetitious definitions of words that are used in many different statutes. *287That the legislature declined to create a narrower definition of "wages" for the purpose of applying sec. 103.455 but instead cross-referenced the existing definition in sec. 109.01 is significant in determining its intent.
The majority relies heavily on the language preceding the definitions in sec. 109.01, Stats., "as used in this chapter." This language does not necessarily exclude the application of these definitions to other chapters. If the legislature had intended the definitions to apply only to ch. 109, it could have expressly indicated that intention when it enacted sec. 109.01 or when it revised that section in 1989. Likewise, the legislature could have objected to cross-referencing sec. 109.01 when it modified sec. 103.455, Stats., later in 1989. The legislature's continued use, without limitation or qualification, of the term as previously defined implies it intended the term to have the same meaning in both chapters. This is true whether the legislature is enacting new legislation or revising existing legislation because it is presumed to have knowledge of its previous statutory definitions. Wood, 148 Wis. 2d at 646, 436 N.W.2d at 597. For the above reasons, I conclude that commissions are "wages" entitled to protection under sec. 103.455.
Because this conclusion is not dispositive of the appeal, I must also address the issue whether the statute of limitations bars Erdman's claim for commissions. I conclude that the six-year statute of limitations in sec. 893.43, Stats., and not the two-year statute of limitations in sec. 893.44 applies to Erdman's claims for the following reasons.
Section 893.44, Stats., provides, "Any action to recover unpaid salary, wages or other compensation for personal services, except actions to recover fees for professional services,... shall be commenced within 2 years after the cause of action accrues or be barred." (Empha*288sis added.) This two-year statute of limitations is an exception to the general six-year statute of limitations for contract actions. Saunders, 85 Wis. 2d at 74, 270 N.W.2d at 177.
In Saunders, our supreme court stated that the determination of whether the two-year statute of limitations for claims for unpaid compensation for personal services applies depends on whether the object of the compensation is human labor itself or whether the object of the compensation is to secure a particular end result of human labor. Id. at 74-75, 270 N.W.2d at 177-78. If the payment and amount of compensation are dependent on the hours or amount of labor the employe expends, the object of the compensation is human labor and the two-year statute of limitations applies. Id. at 74-75, 270 N.W.2d at 178. In contrast, if the payment and amount of compensation depend on achievement of a result, irrespective of the hours or amount of labor the employe expends to achieve the result, compensation is not for personal services and the general six-year statute of limitations for contract actions applies. Id. Our supreme court has consistently followed this narrow construction of sec. 893.44, Stats., since 1956. See, e.g., Dunbar v. Brunstad, 273 Wis. 479, 480, 78 N.W.2d 878, 879 (1956); Cordova v. Gutierrez, 23 Wis. 2d 598, 604, 128 N.W.2d 62, 65 (1964); Saunders, 85 Wis. 2d at 75, 270 N.W.2d at 178 (citing other prior cases applying this construction).
Here, as in Saunders, the payment and amount of commissions were not based upon hours worked or effort expended by Erdman. Instead, Erdman's commissions were based on the amount of petroleum and merchandise sales each month. He was to receive a commission of a percent of sales made, irrespective of the time he spent or labor he extended at the gas station/convenience *289store. I therefore conclude that the portion of Erdman's employment contract providing for payment of commissions was not a contract for Erdman's personal services and, consequently, Erdman's claim for unpaid commissions is subject to the six-year statute of limitations for contract actions in sec. 893.43, Stats.
An examination of the two statutes demonstrates that this construction of sec. 893.44, Stats., is consistent with the construction of the term "wages" as used in sec. 103.455, Stats. Section 103.455 applies to "wages," irrespective of how they are earned or calculated. The statute of limitations, however, requires an examination of the basis upon which the income is calculated. Section 893.44, by its terms, applies only to wages calculated based on the employe's provision of personal services. Further, as a remedial statute, sec. 103.455 is broadly construed; in contrast, as a restrictive exception to a general statute of limitations, sec. 893.44 is construed narrowly. Saunders, 85 Wis. 2d at 73-74, 270 N.W.2d at 177.