Court Opinion

ID: 4251861
Source: CourtListenerOpinion
Date Created: 2018-03-05 23:06:27.19436+00
Date Added: 2024-06-11T14:43:50.471607
License: Public Domain

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3              http://www.courts.state.co.us. Opinions are also posted on the
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5
6                                                         ADVANCE SHEET HEADNOTE
7                                                                      March 5, 2018
8
9                                         2018 CO 15
0
1   No. 17SA77, Hernandez v. Ray Domenico Farms, Inc.—C.A.R. 21.1, Certified
2   Questions of State Law—Colorado Wage Claim Act—Statute of Limitations—
3   Statutory Construction.
4
5         The supreme court accepts jurisdiction under C.A.R. 21.1 to answer a certified

6   question of law from the United States District Court for the District of Colorado

7   regarding how far back in time a terminated employee’s unpaid wage claims can reach

8   under the Colorado Wage Claim Act, §§ 8-4-101 to -123, C.R.S. (2017). The supreme

9   court holds that, under the plain language of section 8-4-109, a terminated employee

0   may seek any wages or compensation that were unpaid at the time of termination;

1   however, the right to seek such wages or compensation is subject to the statute of

2   limitations found in section 8-4-122. That statute of limitations begins to run when the

3   wages or compensation first become due and payable and thus limits a terminated

4   employee to claims for the two years (three for willful violations) immediately

5   preceding termination.

6
                    The Supreme Court of the State of Colorado
                      2 East 14th Avenue • Denver, Colorado 80203

                                      2018 CO 15

                          Supreme Court Case No. 17SA77
                            Certification of Question of Law
                United States District Court for the District of Colorado
                           Case No. 16-CV-1929-WJM-CBS
                                       Plaintiffs:
 Adolfo Hernandez, Rogelio Flores-Escobar, Francisco Silva-Garcia, Martin Perez-Medel,
           Gustavo Arellano-Olmos, Luis Leon-Salinas, and Manuel Morales,
                                           v.
                                     Defendants:
      Ray Domenico Farms, Inc.; Gregory L. Domenico; and Theresa M. Domenico.

                              Certified Question Answered
                                       en banc
                                     March 5, 2018

Attorneys for Plaintiffs:
The Kelman Buescher Firm
Andrew H. Turner
Ashley K. Boothby
 Denver, Colorado

Colorado Legal Services: Migrant Farm Workers Division
Jenifer Rodriguez
Matthew Baca
  Denver, Colorado

Attorneys for Defendants:
The Litigation Boutique LLC
Leah P. VanLandschoot
 Denver, Colorado

Attorneys for Amicus Curiae Colorado Civil Justice League:
Husch Blackwell LLP
Christopher L. Ottele
Sonia Anderson
 Denver, Colorado

Attorneys for Amici Curiae Southern Poverty Law Center, Farmworker Justice, El
Centro Humanitario Para Los Trabajadores, and Plaintiff Employment Lawyers
Association:
Law Office of David Lichtenstein, LLC
David Lichtenstein
Matt Molinaro
Kristina Rosett
 Denver, Colorado

JUSTICE HART delivered the Opinion of the Court.

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¶1    We accepted jurisdiction under C.A.R. 21.1 to answer a certified question of law

from the United States District Court for the District of Colorado regarding how far

back in time a terminated employee’s unpaid wage claims can reach under the

Colorado Wage Claim Act, §§ 8-4-101 to -123, C.R.S. (2017). Answering this question

requires us to examine the interaction among three provisions of the law. Under section

8-4-103 (“section 103”), employers must pay employees at regular intervals during their

employment.      Section 8-4-109 (“section 109”) requires employers to pay employees

upon termination for unpaid wages or compensation. Under the Wage Claim Act’s

statute of limitations, “all actions” must be commenced within two years (three for

willful violations), “and not after that time.” § 8-4-122, C.R.S. (2017). The certified

question asks:

      Does Colo. Rev. Stat. § 8-4-109(1)(a) permit a terminated employee to sue
      for wages or compensation that went unpaid at any time during the
      employee’s employment, even when the statute of limitations (Colo. Rev.
      Stat. § 8-4-122) has run on the cause of action the employee could have
      brought for those unpaid wages under Colo. Rev. Stat. § 8-4-103(1)(a)?

We hold that under the plain language of section 109, an employee may seek any wages

or compensation that were unpaid at the time of termination; however, the right to seek

such wages or compensation is subject to the statute of limitations. That statute of

limitations begins to run when the wages or compensation first become due and

payable and thus limits a terminated employee to claims for the two (or three) years

immediately preceding termination. Thus, we answer the certified question in the

negative.

                                          3
                           I. Facts and Procedural History

¶2    Defendant Ray Domenico Farms, Inc.1 grows organic vegetables in Platteville,

Colorado. Plaintiffs are three year-round and four seasonal migrant workers who had

been previously employed by Domenico Farms from as far back as 1992. All of the

Plaintiffs were paid by the hour, and allege that they never received overtime pay

during their employment with Domenico Farms.            While agricultural workers are

generally exempt from the Fair Labor Standards Act’s (“FLSA”) overtime requirements,

see generally 29 C.F.R. pt. 780 (2017), Plaintiffs allege that they performed non-

agricultural tasks in weeks in which they worked more than forty hours.             Thus,

Plaintiffs allege that they were entitled to overtime wages under the FLSA for those

weeks. See 29 C.F.R. § 780.11 (2017) (“Where an employee in the same workweek

performs work which is exempt under one section of the Act and also engages in work

to which the Act applies but is not exempt under some other section of the Act, he is not

exempt that week, and the wage and hour requirements of the Act are applicable.”).

The four seasonal-worker Plaintiffs also allege that they were denied the Adverse Effect

Wage Rate hourly wages they should have received under the Migrant and Seasonal

Agricultural Worker Protection Act (“AWPA”).          In January 2016, several of the

Plaintiffs wrote a letter to Defendants in which they asserted that they had not been

properly paid wages under both of these federal laws. By April 2016, all of the Plaintiffs

had been terminated.

1 Plaintiffs named two principals of Ray Domenico Farms, Inc.—Gregory L. Domenico
and Teresa M. Domenico—as co-defendants in their lawsuit. However, Plaintiffs’
claims under the Colorado Wage Claim Act are brought only against Domenico Farms.

                                            4
¶3    Plaintiffs brought suit in July 2016 in the United States District Court for the

District of Colorado alleging, in pertinent part, violations of the FLSA, the AWPA, and

the Colorado Wage Claim Act (“the Act”). The parties filed cross-motions for partial

summary judgment on the issue of whether section 109 allows a terminated employee

to seek all wages that have been unpaid during the employment—even those that might

seem to be time-barred because they became due and payable more than two (or three)

years earlier. Judge William J. Martinez concluded that, as there are “at least two

plausible interpretations of section 109” and the outcome of the decision was “of

enormous importance” to employers and employees in Colorado, it was appropriate to

sua sponte certify the question to this court. We accepted jurisdiction.

                                      II. Analysis

¶4    Plaintiffs argue that, under section 109 of the Act, employees are entitled to seek

any unpaid wages or compensation earned during the course of their employment, as

the statute of limitations begins to run on their section 109 claim only upon the

termination of the employment relationship. The section 109 claim, they argue, revives

a terminated employee’s right to seek unpaid wages that he would be time-barred from

receiving if he were still employed and bringing a suit under section 103. Defendant

argues that section 109 allows a terminated employee to collect wages only due as part

of the final paycheck.    Neither of these arguments is consistent with the statutory

language and structure.     We agree that the plain language of section 109 allows

employees to seek both the wages or compensation that only become due and payable

at the end of the employment and those that had previously become due and payable.

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However, we cannot agree that section 109 allows Plaintiffs to resurrect claims for

wages that were time-barred as of the date of termination.

                A. Standard of Review and Canons of Construction

¶5     Under Appellate Rule 21.1, this court may answer questions of Colorado law as

to which it appears we have not issued controlling precedent when those questions are

certified to us from a federal court. C.A.R. 21.1.       We conduct our review of such

questions de novo. Leonard v. McMorris, 63 P.3d 323, 326 (Colo. 2003).

¶6     In interpreting the language of the Act, we are guided by familiar principles.

Our fundamental duty in construing statutes is to give effect to the intent of the General

Assembly. E.g., Vigil v. Franklin, 103 P.3d 322, 327 (Colo. 2004). We look first to the

plain language of the statute; if it is clear and unambiguous, then we look no further

and “apply the statute as written.” Id. (quoting In re 2000–2001 Dist. Grand Jury, 97

P.3d 921, 924 (Colo. 2004)). In so doing, we must consider the statute in its entirety,

giving “harmonious and sensible effect to all its parts.” Leonard, 63 P.3d at 326. In

construing statutes of limitation, we attempt to interpret them “consistent with their

purposes of promoting justice, avoiding unnecessary delay, and preventing the

litigation of stale claims.” Morrison v. Goff, 91 P.3d 1050, 1052 (Colo. 2004).

          B. Section 109 Allows Former Employees to Seek Previously
                                 Unpaid Wages

¶7     As an initial matter, we must first determine what sorts of wages may be sought

under section 109. Phrased differently, does section 109 refer only to wages that would

be included in the “last paycheck,” or may former employees use it to seek other wages

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that previously went unpaid and that could have been sought during employment

under section 103? Plaintiffs argue that there are no words of limitation in section 109

to restrict former employees from seeking previously unpaid wages. Defendant argues

that section 103 and section 109 govern two mutually exclusive sets of wages and

compensation. Based on the Act’s plain language, we agree with Plaintiffs on this initial

point: terminated employees are not limited under section 109 to only those wages or

compensation that become due and payable upon separation, but may seek prior

earned-yet-unpaid wages or compensation as well.2

¶8    Mindful that we must read the Act as a coherent whole, we begin by looking to

the plain language of section 109. Section 109(1)(a) provides in pertinent part: “When

an interruption in the employer–employee relationship by volition of the employer

occurs, the wages or compensation for labor or service earned, vested, determinable,

and unpaid at the time of such discharge is [sic] due and payable immediately.” The

Act defines “wages or compensation” as:

      (I) All amounts for labor or service performed by employees, whether the
      amount is fixed or ascertained by the standard of time, task, piece,
      commission basis, or other method of calculating the same or whether the
      labor or service is performed under contract, subcontract, partnership,
      subpartnership, station plan, or other agreement for the performance of
      labor or service if the labor or service to be paid for is performed
      personally by the person demanding payment. No amount is considered
      to be wages or compensation until such amount is earned, vested, and

2 In fact, we have previously recognized that the Act requires an employer upon
termination of an employee to “pay the employee[] all earned but yet unpaid wages
and compensation, within the time period the Wage Claim Act prescribes.” Leonard, 63
P.3d at 328 (emphasis added) (discussing the Act in the context of construing whether
officers and agents of a corporation are jointly and severally liable for payment of
wages or compensation).

                                           7
       determinable, at which time such amount shall be payable to the
       employee pursuant to this article.

       (II) Bonuses or commissions earned for labor or services performed in
       accordance with the terms of any agreement between an employer and
       employee;

       (III) Vacation pay earned in accordance with the terms of any agreement.
       If an employer provides paid vacation for an employee, the employer
       shall pay upon separation from employment all vacation pay earned and
       determinable in accordance with the terms of any agreement between the
       employer and the employee.

§ 8-4-101(14)(a), C.R.S. (2017).

¶9     Under the Act’s plain language, a terminated employee is entitled to receive “all

amounts for labor or service performed,” § 8-4-101(14)(a), which are “earned, vested,

determinable, and unpaid at the time of discharge,” § 8-4-109(1)(a). This may include

wages of the sort that are due and payable regularly throughout the time of

employment      and    also    some   types       of   compensation—like   vacation   pay,

§ 8-4-101(14)(a)(III)—that are payable only at separation.

¶10    The only limitation the General Assembly placed on the types of wages or

compensation to be received at termination was that they must be “earned, vested,

determinable, and unpaid.” § 8-4-109(1)(a). None of these words indicates an intent to

limit section 109 to cover only wages or compensation properly paid in the final pay

period and not any wages that could have been previously sought under section 103 but

that remain unpaid at the time of termination. Thus, we find nothing in the text of

section 109 that would limit the wages or compensation that can be sought thereunder

to only the class of wages payable at the end of employment or as part of the final

paycheck.

                                              8
¶11    Defendant argues that we should read section 109 to include claims for only the

final paycheck because of the language of section 103.       That section provides in

pertinent part: “All wages or compensation, other than those mentioned in section

8-4-109, earned by any employee in any employment . . . shall be due and payable for

regular pay periods . . . .” § 8-4-103 (emphasis added). Defendant urges that section

103’s exception for “those [wages or compensation] mentioned in section 8-4-109”

demonstrates an intent by the General Assembly to create two mutually exclusive

categories of remuneration under the two sections. We think this stretches the language

of section 103 too far.

¶12    In fact, when read together, the sections suggest the opposite. Sections 109 and

101 (defining wages and compensation) demonstrate that the General Assembly

understood that certain categories of wages or compensation—such as unused vacation

time, bonuses, or commissions—would not be available until separation because they

may not become “vested” or “determinable” under the employment agreement until

that time.   These types of compensation are therefore excluded from the regular

paycheck provisions of section 103. The fact that certain types of wages are excluded

from section 103 does not mean that a reciprocal limitation must be read into section

109. Had the General Assembly wished to exclude previously earned but still unpaid

wages from being sought by a terminated employee under section 109, it clearly knew

how to do so. But section 109 does not include the kind of limiting language included

in section 103.

                                           9
¶13      The language of the statute, read as a whole, suggests that the General Assembly

sought only to clarify that employers had no obligation to include—and employees had

no right to seek—those types of wages or compensation that could be paid out only at

separation in the regularly occurring payments under section 103.             To read this

exclusion to apply in the opposite direction—to limit section 109 only to those types of

compensation—would require inserting language into section 109 that is not there. We

presume that the General Assembly did not idly include this exclusive language in

section 103 and omit any similar language from section 109.            Thus, we hold that

terminated employees may seek previously unpaid wages or compensation at

separation under section 109, subject to the statute of limitations as set forth in section C

below.

          C. The Statute of Limitations Accrues from the Date the Wages
             First Became Due and Payable

¶14      Having resolved that section 109 allows Plaintiffs to pursue claims for unpaid

wages that could have been brought under section 103 during their employment, we

turn to what effect to give to the statute of limitations in section 8-4-122 (“section 122”)

for such claims. Although a terminated employee may bring a claim under section 109

for previously earned yet unpaid wages, the statute of limitations for those wages

begins to run on the date that each set of wages first became due and payable—not on

the date of separation.

¶15      We begin again with the plain language of the Act’s statute of limitations:

         All actions brought pursuant to this article shall be commenced within
         two years after the cause of action accrues and not after that time; except

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       that all actions brought for a willful violation of this article shall be
       commenced within three years after the cause of action accrues and not
       after that time.

§ 8-4-122, C.R.S. (2017) (emphasis added).        “A cause of action for . . . money

owed . . . shall be considered to accrue on the date such . . . money owed becomes due.”

§ 13-80-108. By operation of section 103, regularly earned wages or compensation

become due and payable on regular paydays no more than ten days following the close

of each pay period.      § 8-4-103.   Similarly, section 101(14)(a) provides that upon

becoming earned, vested, and determinable, wages or compensation “shall be payable

to the employee pursuant to this article.” § 8-4-101(14)(a).

¶16    As we set forth above, a claim under section 109 can be for both wages or

compensation that do not become earned, vested, or determinable until separation and

for regular wages that had previously been earned but remain unpaid. The former do

not become due and payable until the time of separation. The latter, however, had

already become due and payable on the payday after the close of the pay period in

which they were earned. If an employee fails to pursue a claim to receive unpaid wages

for more than two (or three) years after those wages are due and payable, the

employee’s claim to those wages is extinguished by operation of the statute of

limitations. Those wages are no longer due to the employee, and section 109 does

nothing to make these extinguished claims due and payable again. The plain language

of these sections shows that the General Assembly intended for claims to be brought

within two or three years of when the wages became due and payable, and not after

that time.

                                            11
¶17    To allow a terminated employee to bring claims for wages that had become due

and payable many years before would flout the very purpose of statutes of limitations:

promoting justice, avoiding unnecessary delay, and preventing the litigation of stale

claims.   Morrison, 91 P.3d at 1052.      The General Assembly has demonstrated its

preference for defined limitations periods, prescribing a generic two-year statute of

limitations period for “all other actions of every kind for which no other period of

limitation is provided.” § 13-80-102(1)(i), C.R.S. (2017). To allow the result Plaintiffs

urge would in effect create an indefinite period for a statute of limitations.3 This would

be an unusual result. We decline to find that the General Assembly intended such an

unusual result absent clear and specific language in the statute. Based on our reading of

the plain language of the statute, we do not believe that the General Assembly intended

this sort of absurd effect. See Leonard, 63 P.3d at 326.

¶18    This interpretation is bolstered when considered in the context of the entire

statutory scheme. In particular, we note that the General Assembly recently amended

the Act to add a requirement that employers keep their employment records for a

period of at least three years. See § 8-4-103(4.5), C.R.S. (2017) (“An employer shall retain

records reflecting the information contained in an employee’s itemized pay statement as

described in subsection (4) of this section for a period of at least three years after the

wages or compensation were due.”). The fact that this record-keeping period matches

the maximum period of liability under the statute of limitations supports our

3Moreover, such an interpretation would also severely reduce the efficacy of the longer
period allowed for willful violations under the statute of limitations, as employees
could seek many years of wages for negligent conduct at separation.

                                            12
conclusion that the General Assembly intended that a terminated employee could reach

back no further than three years for wages that had been previously unpaid.

¶19   Finally, while our interpretation is grounded in the plain language of the Act, we

note that legislative history and common sense corroborate our understanding of the

General Assembly’s intent. Section 122’s statute of limitations was added in 1986 to

“bring[] our laws into compliance with where the Federal Fair Labor Act is.” Hearings

on H.B. 86-1231 before the H. Business Affairs and Labor Comm., 55 Gen. Assemb., 2d

Sess. (Feb. 11, 1986).   The FLSA’s statute of limitations utilizes the same two- or

three-year framework as section 122. See 29 U.S.C. § 255(a) (2012) (“Any action . . . may

be commenced within two years after the cause of action accrued, and every such action

shall be forever barred unless commenced within two years after the cause of action

accrued, except that a cause of action arising out of a willful violation may be

commenced within three years after the cause of action accrued.”).          The FLSA’s

implementing regulations provided, both in 1986 and today, that a cause of action

under the FLSA “‘accrues’ when the employer fails to pay the required compensation

for any workweek at the regular pay day for the period in which the workweek ends.”

29 C.F.R. § 790.21(b) (1985). The FLSA’s statute-of-limitations regime comports with

our reading of the Act that the statute of limitations runs two or three years from when

the wages first become due and payable. In fact, if we permitted the indefinite statute

of limitations that Plaintiffs urge on us, the Act would revive time-barred FLSA claims

since Plaintiffs’ Colorado claims are directly tied to their claim to overtime under the

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FLSA. Instead of bringing Colorado’s laws “into compliance” with federal law, the

state laws would be in direct tension with federal standards.

¶20    We thus hold that while terminated employees may include claims for

previously earned wages under section 109, the right to bring those claims is subject to

section 122’s period of limitations, which runs from the date that the wages first became

due and payable.     That is, the period begins to run on the payday following the

conclusion of the pay period in which the wages were earned—not on the day of

termination.

                                    III. Conclusion

¶21    We conclude that under section 109, terminated employees may seek wages or

compensation that had been earned in prior pay periods but remain unpaid at

termination. This right, however, is subject to the statute of limitations in section 122,

which runs from the date when the wages first became due and payable—the payday

following the pay period in which they were earned. A terminated employee is thus

limited to claims for the two (or three) years immediately preceding termination.

Therefore, we answer the certified question from the District of Colorado in the

negative, and return this case to that court for further proceedings.

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