Court Opinion

ID: 4715437
Source: CourtListenerOpinion
Date Created: 2021-08-12 00:43:34.715798+00
Date Added: 2024-06-11T08:07:26.580778
License: Public Domain

Wiggins, J.
¶53 (dissenting) — The trial court properly struck down the retroactive increase in employee health insurance premiums as arbitrary and capricious because the arbitrator did not consider the statutory authority of the employer as required in statutorily mandated interest arbitration under RCW 41.56.465(l)(a). The award thus violates the wage rebate act (WRA), chapter 49.52 RCW. An employer violates the WRA when it collects or receives “from any employee a rebate of any part of wages theretofore paid . . . .” RCW 49.52.050(1). In this case, after the expiration of the collective bargaining agreement (CBA), Kitsap County (County) (the employer) paid the deputies (the employees) the same wages for the same work for three years. The arbitration award required the deputies to return a portion of their previously earned health insurance premiums to the County, effectively rebating wages previously paid to their employees. We have always recognized that “[h]aving once received his wages in full, the employee is at liberty to do what he will with his earnings.” State v. Carter, 18 Wn.2d 590, 622, 142 P.2d 403 (1943). I respectfully dissent.5
*378ANALYSIS
I. The WRA protects an employee from employer rebates

A. Plain language

¶54 The meaning of a statute is a question of law reviewed de novo. Dep’t of Ecology v. Campbell & Gwinn, LLC, 146 Wn.2d 1, 9, 43 P.3d 4 (2002). “The court’s fundamental objective is to ascertain and carry out the Legislature’s intent, and if the statute’s meaning is plain on its face, then the court must give effect to that plain meaning as an expression of legislative intent.” Id. at 9-10.
¶55 We begin with the plain language of the statute. The WRA states in relevant part:
Any employer or officer, vice principal or agent of any employer, whether said employer be in private business or an elected public official, who
(1) Shall collect or receive from any employee a rebate of any part of wages theretofore paid by such employer to such employee;
Shall be guilty of a misdemeanor.
RCW 49.52.050. Because the WRA does not define “wage” or “rebate,” the court may look to related statutes and dictionary definitions for meaning. Campbell & Gwinn, 146 Wn.2d at 4 (discussing related statutes); Garrison v. Wash. State Nursing Bd., 87 Wn.2d 195, 196, 550 P.2d 7 (1976) (discussing dictionary definitions).
¶56 We used both related statutes and the dictionary to define the terms “rebate” and “wage” as used in the WRA in LaCoursiere v. Camwest Development, Inc., 181 Wn.2d 734, 742-44, 339 P.3d 963 (2014). Using the Washington Mini*379mum Wage Act, chapter 49.46 RCW, and a dictionary definition of “wage,” we asserted that wages encompassed both “ ‘moneys due by reason of employment’ ” and payment for work performed. Id. at 743 (internal quotation marks omitted) (quoting Flower v. T.R.A. Indus., Inc., 127 Wn.App. 13, 34, 111 P.3d 1192 (2005)), 743-44 (holding that “LaCour-siere’s bonuses were wages because the bonuses were already paid for work performed”). This definition “gives effect to the legislature’s intent to protect money due to employees and comports with the broad definition of ‘wage.’ ” Id. at 744.
¶57 In LaCoursiere, we considered the context of the statute and other provisions in the WRA in concluding that a “rebate occurs when an employee receives less than his or her expected wages because a portion of those wages have returned to the employer or its agent.” Id. We also considered the plain language in the WRA, RCW 49.52.050(1), and concluded that “a ‘rebate’ occurs when an employer or its agent collects or receives a portion of an employee’s wage after the wage has been paid.” Id.
¶58 Thus, the plain language of the WRA protects an employee from having to rebate wages to his or her employer. The Kitsap County arbitration award violates the WRA if the health insurance premiums paid to the deputies were “wages” and if a “rebate” occurred when the deputies were ordered to retroactively pay for an increase in their health benefit premiums.

B. The purpose of the WRA is to protect wages

¶59 The purpose of the WRA supports its application to these facts. The legislature enacted the WRA “to protect the wages of an employee against any diminution or deduction therefrom by rebating, underpayment, or false showing of overpayment of any part of such wages.” Carter, 18 Wn.2d at 621. Accordingly, the WRA “must be liberally construed to advance the Legislature’s intent to protect employee wages.” Schilling v. Radio Holdings, Inc., 136 Wn.2d 152, 159, 961 P.2d 371 (1998).
*380¶60 Rather than effectuating the legislature’s purpose by construing the WRA liberally, the lead opinion limits the WRA to prohibiting abuse of the collective bargaining process in reliance on a fragment from one of our prior decisions: “The legislature enacted the WRA ‘to prevent abuses by employers in a labor-management setting, e.g., coercing rebates from employees in order to circumvent collective bargaining agreements.’ ” Lead opinion at 371 (quoting Ellerman v. Centerpoint Prepress, Inc., 143 Wn.2d 514, 519-20, 22 P.3d 795 (2001)). The rest of the paragraph in Ellerman clearly reveals that the WRA is not limited to abuse of collective bargaining but protects against “any diminution or deduction” from wages by rebating:
“[T]he fundamental purpose of the legislation, as expressed in both the title and body of the act, is to protect the wages of an employee against any diminution or deduction therefrom by rebating, underpayment, or false showing of overpayment of any part of such wages. The act is thus primarily a protective measure, rather than a strictly corrupt practices statute. In other words, the aim or purpose of the act is to see that the employee shall realize the full amount of the wages which by statute, ordinance, or contract he is entitled to receive from his employer, and which the employer is obligated to pay, and, further, to see that the employee is not deprived of such right, nor the employer permitted to evade his obligation, by a withholding of a part of the wages . . . .”
Ellerman, 143 Wn.2d at 520 (alterations in original) (internal quotation marks omitted) (quoting Schilling, 136 Wn.2d at 159). The lead opinion correctly states that abusing the collective bargaining process is protected by the WRA, but importantly, so is “any diminution or deduction” of an employee’s wages “by rebating, underpayment, or false showing of overpayment of any part of such wages.” Id. Here there was no abuse of the collective bargaining process, but a rebate plainly occurred when the arbitration award required the deputies to retroactively pay for the increase in health care premiums that were covered by the County *381during the three years when there was no collective bargaining agreement in place.
II. Application of the WRA
A. Health insurance premiums are wages
¶61 “In the absence of a specific statutory definition, words in a statute are given their common law or ordinary meaning.” State v. Chester, 133 Wn.2d 15, 22, 940 P.2d 1374 (1997).
¶62 In determining whether the health insurance premiums paid by the county constitute “wages” under the WRA, we look to our recent decision in LaCoursiere, in which we held that wages encompass both payment for work performed and “ ‘moneys due by reason of employment.5 ” LaCoursiere, 181 Wn.2d at 741-43 (internal quotation marks omitted) (quoting Flower, 127 Wn. App. at 34). Liberally construing the WRA, we construed “wages” using Wehsters’ broad definition of “wage” to include not only salaries but also “bonuses, once paid for work performed.” Id. at 741.
¶63 Applying the same reasoning to health care premiums, we have also explicitly held that health care premiums are “wages” under Washington’s Industrial Insurance Act, Title 51 RCW. See RCW 51.08.178; Cockle v. Dep’t of Labor & Indus., 142 Wn.2d 801, 823, 16 P.3d 583 (2001) (recognizing that health care coverage is frequently a significant part of an employee’s compensation package and should be considered a wage). Our decision in Cockle comports with the dictionary definition of “wage,” which includes “amounts paid by the employer for insurance.” Webster’s Third New International Dictionary 2568-69 (2002). Therefore, I would hold that health care premiums are “wages” under the WRA.
¶64 The record is clear that the health insurance premiums at issue here were wages because they were paid for work performed. The deputies’ wages were established in *382the 2008-2009 CBA. The terms of that CBA required the County to pay the entirety of the deputies’ health insurance premiums and 90 percent of the deputies’ dependents’ premiums. After the CBA expired, the County was required to maintain the same level of “existing wages, hours, and other conditions of employment” under the provisions of the Public Employees’ Collective Bargaining Act (PECBA), chapter 41.56 RCW. RCW 41.56.470. The deputies worked with the reasonable expectation that the County would continue to pay their salaries and health insurance premiums at the statutorily prescribed level; indeed, for three years, this is exactly what happened.

B. The arbitration award effects a rebate

¶65 Having concluded that health insurance premiums are wages, we now consider whether the decrease in the deputies’ wages for the payment of retroactive health care premiums constitutes a “rebate.” “[A] ‘rebate’ occurs when an employer or its agent collects or receives a portion of an employee’s wage after the wage has been paid.” LaCoursiere, 181 Wn.2d at 744 (emphasis added) (citing RCW 49.52.050(1)). Employees have “[t]he right to a salary for work performed at the rate admittedly effective during the period when the work was performed.” Foley v. Carter, 526 F. Supp. 977, 985 (D.D.C. 1981); Navlet v. Port of Seattle, 164 Wn.2d 818, 828 n.5, 194 P.3d 221 (2008) (“In the employment context, an employee who renders service in exchange for compensation has a vested right to receive such compensation.” (citin g Leonard v. City of Seattle, 81 Wn.2d 479, 487, 503 P.2d 741 (1972))).
¶66 In analyzing whether there was a rebate, we must first determine the effective rate of pay during the period when the work was performed. PECBA, chapter 41.56 RCW, governs collective bargaining negotiations for public em*383ployees. Specifically, as “uniformed personnel,”6 the deputies’ wages during the interim period are defined as the “existing wages, hours, and other conditions of employment,” which were defined by the expired CBA. RCW 41.56.470. Therefore, the expired CBA became the deputies’ effective rate of pay. The plain language of PECBA supports this conclusion:
During the pendency of the proceedings before the arbitration panel, existing wages, hours, and other conditions of employment shall not be changed by action of either party without the consent of the other but a party may so consent without prejudice to his or her rights or position under chapter 131, Laws of 1973.
RCW 41.56.470. The language of RCW 41.56.470 is mandatory; the imperative “shall” does not permit either party to change the existing wages, hours, or conditions of employment without the consent of the other.
¶67 The intent and purpose of PECBA support the premise that RCW 41.56.470 controls the effective rate of wages for work performed:
The intent and purpose of [PECBA] is to recognize that there exists a public policy in the state of Washington against strikes by uniformed personnel as a means of settling their labor disputes; that the uninterrupted and dedicated service of these classes of employees is vital to the welfare and public safety of the state of Washington; that to promote such dedicated and uninterrupted public service there should exist an effective and adequate alternative means of settling disputes.
RCW 41.56.430. The PECBA advances a balance between uniformed employees and employers. So long as the deputies remain employees, the deputies are required to continue working the same hours under the same conditions of *384employment. Under PECBA, a uniformed employee’s right to strike, or engage in a work slowdown or stoppage, is rescinded, but in return PECBA guarantees that existing wages will continue until a dispute is resolved. RCW 41.56-.490. The quid pro quo for the deputies’ “dedicated and uninterrupted public service” is that the County continues to pay the deputies “existing wages.”
¶68 As discussed, the deputies’ “existing wages” included health insurance payments. Even the lead opinion appears to acknowledge that RCW 41.56.470 required the County to maintain “the same level of pay and benefits provided under the 2008-2009 CBA.” Lead opinion at 360 (emphasis added). We should hold that RCW 41.56.470 governs our analysis of the deputies’ effective wages during the interim period because the arbitration proceedings were pending and the statute explicitly prohibits either party from changing the existing wages and conditions of employment.
¶69 Because the compensation the County paid the deputies during the interim period is statutorily defined, “[t]he promised compensation for services actually performed and accepted . . . may undoubtedly be claimed.” Butler v. Pennsylvania, 51 U.S. (10 How.) 402, 416, 13 L. Ed. 472 (1850). The deputies had the right to the wages they received. We conclude that deputies’ health insurance premiums are wages and that the deputies received no more than their due. By allowing the County to rebate these wages, the arbitration award violates the WRA.

C. There was no overpayment of wages

¶70 The WRA authorizes an employer to withhold wages if empowered by state or federal law, such as in the case of an overpayment of wages; however, no exception to the WRA applies here. RCW 49.52.060 authorizes an employer to withhold a portion of an employee’s wages when authorized by state or federal law. RCW 49.48.200(1) authorizes the state, a county, or a city to withhold an “overpayment of wages” from a public employee’s current wages “as provided *385in RCW 49.48.210 _” RCW 49.48.210(ll)(c) defines an “overpayment” as “a payment of wages for a pay period that is greater than the amount earned for a pay period.” The wages paid to the deputies were not in any sense “greater than the amount earned” because they were exactly the wages due, i.e., exactly what the law provided they had earned. The deputies were not, as the lead opinion contends, overpaid.7
III. Because the arbitration award violated the WRA, it is arbitrary and capricious
¶71 We should uphold the trial court’s finding that the arbitration award was arbitrary and capricious. PECBA governs our review of the arbitration panel’s decision. Under PECBA, the statutorily mandated interest arbitration panel “exercises a state function and is ... a state agency.” RCW 41.56.452. We do not give the panel any “ ‘great deference’ ” “[b]ecause there is no guaranty that any member of the arbitration panel will have any expertise in labor relations.” City of Bellevue v. Int’l Ass’n of Fire Fighters, Local 1604, 119 Wn.2d 373, 381, 831 P.2d 738 (1992). Instead, the superior court reviews the decision of the panel *386to determine whether its decision was arbitrary or capricious.8 RCW 41.56.450.
¶72 We have defined “arbitrary and capricious” behavior as “willful, unreasoning, and taken without regard to the attending facts or circumstances.” Ass’n of Wash. Spirits & Wine Distribs. v. Wash. State Liquor Control Bd., 182 Wn.2d 342, 358, 340 P.3d 849 (2015). The “attending facts or circumstances” require the panel to consider “[t]he constitutional and statutory authority of the employer” when making its determination. RCW 41.56.465(l)(a). If the panel issues an award that exceeds the “statutory authority of the employer,” then that award is arbitrary and capricious.
¶73 I would hold that the arbitration award violates the WRA because under the award the employer receives a rebate of wages earned by the employee. Thus, the award by definition was arbitrary and capricious because it failed to consider the prohibitions against an employer’s receiving a rebate as set forth in the WRA. I agree with the trial court’s determination that the award “incorporates unlawful provisions beyond the lawful authority of the employer and is arbitrary and capricious for that reason.”9 Clerk’s Papers at 436.
Reconsideration denied September 4, 2015.
CONCLUSION
¶74 The lead opinion holds that any compensation paid to public employees after the expiration of a CBA can be rebated to the employer by an arbitration award, i.e., an arbitrator has the power to retroactively declare wages to be overpayments. Consequently, employees will not be able to determine the amount of wages they are being paid for protracted periods of time and employers will be allowed to withhold employees’ wages months or years after the fact.
¶75 For the reasons stated above, I would hold that the arbitration award violates the WRA and affirm the trial court.
¶76 I therefore dissent.
Johnson, Stephens, and Gordon McCloud, JJ., concur with Wiggins, J.

 Although I would decide the case based solely on the WRA violation under principles of constitutional avoidance, I recognize that taking wages triggers due process concerns. The deputies have a property interest in earned wages. Because we have never held that workers do not have a property interest in wages received for work performed, the lead opinion relies on two inapposite cases, i.e., Bd. of Regents of State Colls. v. Roth, 408 U.S. 564, 92 S. Ct. 2701, 33 L. Ed. 2d 548 (1972) and Godfrey v. State, 84 Wn.2d 959, 530 P.2d 630 (1975), for support. However, Roth’s analysis applies only to an employee’s property interest in future employment and Godfrey addressed whether a “vested right to a common-law bar *378to recovery” existed. Godfrey, 84 Wn.2d at 962. The lead opinion’s analysis is inapposite because the deputies are not contending that they had the right to future employment during this period; they are asking to keep what they earned.

 “Uniformed personnel” includes “[l]aw enforcement officers as defined in RCW 41.26.030.” RCW 41.56.030(13)(a). RCW 41.26.030(18) defines a “law enforcement officer” as “any person who is commissioned and employed by an employer on a full time, fully compensated basis to enforce the criminal laws of the state of Washington.” This definition applies to the deputies.

 In concluding that the deputies were overpaid, the lead opinion fundamentally misconstrues the distinction between statutorily mandated arbitration and binding arbitration arising as the result of a contract voluntarily entered into by parties. See lead opinion at 371 n.4 (“Viewing the arbitration award as an extension of collective bargaining, as we must, it becomes clear that the arbitration award acts as a contract that the parties would have reached themselves.”). It is true that we treat arbitrator decisions arising out of contract as part of the contract itself. Kitsap County Deputy Sheriff’s Guild v. Kitsap County, 167 Wn.2d 428, 435, 219 P.3d 675 (2009). The award is then treated like any other contract and can be vacated if it violates public policy. Id. However, “[u]nlike grievance arbitration, interest arbitration is not a matter of contract.” Snohomish County Pub. Transp. Benefit Area v. Pub. Emp’t Relations Comm’n, 173 Wn. App. 504, 510, 294 P.3d 803 (2013) (citing RCW 41.56.450). We review statutorily mandated arbitration that the parties have not bargained for in accordance with the requirements of that statute. Under interest arbitration, we do not treat a panel’s award as part of a contract that the parties entered into because the statute mandating the arbitration requires us to determine whether the panel’s decision is arbitrary or capricious before the award is considered final and binding. If the panel’s decision is arbitrary or capricious, then the award is not binding on the parties. RCW 41.56.450.

 The application of the arbitrary and capricious standard of review is unique in arbitration under PECBA, and it is significantly different from arbitration created through contract. Arbitration awards under the Washington uniform arbitration act are not reviewed to determine if they are arbitrary or capricious, see RCW 7.04A.200, .220-.240, and we have expressly declined to review arbitration arising under contract under an arbitrary and capricious standard because of the importance of supporting the finality of bargained for, binding arbitration. Clark County Pub. Util. Dist. No. 1 v. Int’l Bhd. of Elec. Workers, Local 125, 150 Wn.2d 237, 247, 76 P.3d 248 (2003) (‘When parties voluntarily submit to binding arbitration, they generally believe that they are trading their right to appeal an arbitration award for a relatively speedy and inexpensive resolution to their dispute.”). The application of this more searching review makes sense when we remember that despite the use of the term “arbitration,” the panel created by RCW 41.56.450 is in fact a state agency adjudicating a dispute pursuant to a statutory, rather than a contractual, delegation of authority. See RCW 41.56.452.

 The trial court also found that the award “improperly contains mutually exclusive terms concerning insurance enrollment and is arbitrary and capricious for that reason.” I would not reach that issue.