Opinion
1:22-cv-01394-CL
06-21-2023
ANGELEEN KIRSCHBAUM, Plaintiffs, v. RISE LAW GROUP, INC., a domestic business corporation, MARYANNE PITCHER, an individual, and JAMIE HAZLETT, an individual, Defendants.
FINDINGS AND RECOMMENDATION
Mark D. Clarke United States Magistrate Judge
Plaintiff Angeleen Kirschbaum brings this cause of action against the defendants, Rise Law Group, Inc., Maryanne Pitcher, and Jamie Hazlett. The case comes before the Court on the defendants' motion for partial summary judgment (#19). For the reasons below, the motion should be DENIED.
BACKGROUND
Plaintiff worked as a legal assistant at Rise Law Group, Inc. (“Rise Law”) beginning August 27, 2020. Individual defendants Maiyanne Pitcher and Jamie Hazlett are the attorneys, majority shareholders, and managing partners of Rise Law. Plaintiff alleges that she was paid a salary of $37,200.00 per year as a legal assistant at Rise Law, which is the equivalent of $17.88 per hour for 40 hours per week. Plaintiff alleges, however, that the defendants did not track and maintain accurate records of all hours worked by Plaintiff, including all overtime. Plaintiff estimates that she worked varying hours per week over the course of her employment, but on average she estimates that she worked over 50 hours per week for most of her time at Rise Law. The defendants contend that Plaintiff was overtime-exempt, and Plaintiff disputes this classification. The defendants also assert that Plaintiff never worked more than 40 hours per week during her employment at Rise Law.
On February 23, 2022, Plaintiff sent the defendants an email with the subject line, “Feb 15 Pay Check Questions.” Def Mtn (#19) Ex. A. The email informed defendants that there was a “big mistake” with Plaintiffs paid time off (PTO) and sick time, as recorded on her most recent pay stub. In the email, Plaintiff explained that, based on her prior pay stub and the sick time and PTO she used in the interim, she “should currently have 9 hours remaining of sick [time] and 14.3 hours of PTO remaining.” She also asked why her 3% pay increase was not reflected on her paycheck, along with another pay increase that she was promised, though she could not remember the amount of the increase. Plaintiff estimated that she was due 25.78 hours of combined PTO and sick time. The defendants allege that a Rise Law staff member responded to Plaintiffs February 23 email, and they believed at the time that they had resolved the discrepancy.
Plaintiff tendered her written notice on February 25, 2022, and she offered to provide two weeks' notice, which the defendants declined. Therefore, Plaintiffs employment with Rise Law ended on February 28, 2022, the next business day after she provided notice. Rise Law issued her a final paycheck on March 1, 2022, which was the next business day after her employment ended.
On August 25, 2022, Plaintiff through counsel notified the defendants of nonpayment and wages due. Am. Compl. (#1-1). This notice estimated that Plaintiff was due 42.9 hours of accrued PTO in the amount of $817.20, in addition to unpaid overtime. On September 9, 2022, Rise Law tendered a check for $2000.00. Rise Law indicated that this amount represented “the PTO alleged unpaid in your August 25, 2022 letter received in our office on August 29,2022. This amount includes the $817.20 reflected in your letter and is doubled per ORS 652.150(2)(a).” The payment did not reflect any amount for unpaid overtime.
LEGAL STANDARD
Summary judgment shall be granted when the record shows that there is no genuine dispute as to any material of fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a); Anderson v. Liberty Lobby, Inc., 477 U.S. 242,247 (1986). The moving party has the initial burden of showing that no genuine issue of material fact exists. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986); Devereaux v. Abbey, 263 F.3d 1070, 1076 (9th Cir. 2001) (en banc). The court cannot weigh the evidence or determine the truth but may only determine whether there is a genuine issue of fact. Playboy Enters., Inc. v. Welles, 279 F.3d 796, 800 (9th Cir. 2002). An issue of fact is genuine “if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson, 477 U.S. at 248.
When a properly supported motion for summary judgment is made, the burden shifts to the opposing party to set forth specific facts showing that there is a genuine issue for trial. Id. at 250. Conclusory allegations, unsupported by factual material, are insufficient to defeat a motion for summary judgment. Taylor v. List, 880 F.2d 1040, 1045 (9th Cir. 1989). Instead, the opposing party must, by affidavit or as otherwise provided by Rule 56, designate specific facts which show there is a genuine issue for trial. Devereaux, 263 F.3d at 1076. In assessing whether a party has met its burden, the court views the evidence in the light most favorable to the nonmoving party. Allen v. City of Los Angeles, 66 F.3d 1052, 1056 (9th Cir. 1995).
DISCUSSION
Plaintiff brings two claims for relief: (1) a federal wage claim under the Fair Labor Standards Act (“FLSA”) for unpaid overtime wages and liquidated damages against all three defendants - Rise Law, Maryanne Pitcher, and Jamie Hazlett, Am. Compl. (#1-1) at pp. 37-41, ¶¶ 56-82; and 2) an Oregon wage claim for unpaid wages and penalty wages under ORS 652.140 and ORS 652.150 against defendant Rise Law only. Am. Compl. (#1-1) at pp. 41-49, ¶¶ 82-134. For the reasons below, the defendants' motion for partial summary judgment should be DENIED.
I. Defendants' motion for summary judgment as to individual liability should be denied as moot.
The defendants concede that it is irrelevant whether the individual defendants can be held • individually liable for penalty wages because Plaintiff alleges her claim for penalty wages under ORS 652.140 and ORS 652.150 against Defendant Rise Law only. Therefore, this part of the defendants' motion should be denied as moot.
II. Defendants' motion for summary judgment as to Plaintiff's paid time off and sick time wages should be denied.
In her Oregon wage claim, Plaintiff alleges that defendants failed to timely pay all wages, including paid time off (“PTO”), sick time, and overtime wages, at the end of her employment, in violation of ORS 652.140 and ORS 652.150. The defendants assert, and Plaintiff does not dispute, that Rise Law issued a check for $2,000 in unpaid PTO and sick time wages, which included a matching amount for penalty wages, within 12 days of receiving Plaintiff s August 25, 2022, written notice of nonpayment. Defendants argue that, due to this payment, Plaintiff is not entitled to any additional penalty wages “as it relates to Plaintiffs paid time off and sick time.”
By contrast, the Plaintiff contends that 30 days of penalty wages remains due, based on Plaintiffs February 23 email to the defendants informing them of the incorrect PTO and sick time recorded on her February 15 pay stub and based on Plaintiffs unpaid overtime wages. First, Plaintiff asserts that the February 23 email constituted notice of non-payment of PTO and sick time wages, and the defendants' failure to include compensation for this time in her final paycheck entitled Plaintiff to the full 30 days of penalty wages, or $4,569.60Thus, Plaintiff claims that she was entitled to view the $2,000 check from the defendants as a settlement offer that sought to limit her recovery for these penalty wages, which she had already accrued by the time the August 25, 2022 letter was sent to the defendants. Second, Plaintiff argues that this “settlement offer” of $2,000 also failed to account for her unpaid overtime; she contends that the dispute of fact over that unpaid overtime precludes any limitation of penalty wages, even if defendants had paid the full amount of PTO and sick time, plus 30 days of penalty wages.
The penalty wage calculation is set by statute regardless of the amount or type of wages due as: eight hours per day, times the employee's regular rate of pay up to a maximum of 30 calendar days. ORS 652.150(1); see also Russell v. U.S. Bank Nat'l Ass'n, 246 Or.App. 74, 81 (2011) (penalty wages for each calendar day wages unpaid).
A dispute of fact precludes the Court from determining whether the February 23 email constituted written notice of nonpayment of wages. ORS 652.150(2) states, in relevant part:
(a) If the employee or a person on behalf of the employee submits a written notice of nonpayment, the penalty may not exceed 100 percent of the employee's unpaid wages or compensation unless the employer fails to pay the full amount of the employee's unpaid wages or compensation within 12 days after receiving the notice.
(b) If the employee or a person on behalf of the employee fails to submit a written notice of nonpayment, the penalty may not exceed 100 percent of the employee's unpaid wages or compensation.
(c) A written notice of nonpayment must include the estimated amount of wages or compensation alleged to be owed or an allegation of facts sufficient to estimate the amount owed. Submission of a written notice of nonpayment that fails to include the estimated amount of wages or compensation alleged to be owed or an allegation of facts sufficient to estimate the amount owed does not satisfy the requirement for written notice under this subsection unless the employer has violated ORS 652,610 (Itemized statement of amounts and purposes of deductions), 652.640 (Itemized statement of compensation and deductions required) or 653.045 (Records to be kept by employers).
Plaintiff claims that the email provided enough information to notify Rise Law to investigate its records to not only estimate but calculate the correct amount of PTO due Plaintiff on February 23rd and at her termination, five days later. Defendants claim that a staff member responded to Plaintiffs February 23 email and believed that they resolved the discrepancy, which was the result in a change in firm policy regarding rolling over PTO from the previous year. This dispute of fact precludes summary judgment on this issue.
However, regardless of whether or not the February 23 email constituted written notice under the statute, the issue of whether or not the $2,000 check covered “the full amount of the employee's unpaid wages or compensation” cannot be determined at this time. ORS 652.140(1) requires payment of “all wages earned and unpaid at the time of the [] termination ... not later than the end of the first business day after the [] termination.” Likewise, and without regard to the type or amount of wages, ORS 652.150(1) imposes “a penalty” on an employer when it “willfully fails to pay any wages or compensation” as required by ORS 652.140. In other words, the statute imposes a single penalty on an employer who willfully fails to timely pay “any wages” owed at termination. “We construe ‘wages' to mean all earned compensation contracted . to be paid by the employer for the employee's personal service regardless of the nature of such compensation.” Nilsen v. Oregon State Motor Ass'n, 248 Or 133, 136 (1967).
Defendants admit that “[they] did not tender any payment for Plaintiff's claimed overtime, as defendants dispute those claims.” Def. Mtn (#19). As such, a dispute of material fact exists as to whether “all wages” under 652.140(1), or “the full amount,” under ORS 652.150(2), was paid when the defendants issued the $2,000 check. When the matter of Plaintiff's overtime wages is resolved, only then can the matter of a penalty for nonpayment of “all wages” be addressed. The defendants are not entitled to summary judgment on this issue.
RECOMMENDATION
Defendants' Motion (#19) should be DENIED.
SCHEDULING
This Findings and Recommendation will be referred to a district judge. Objections, if any, are due no later than fourteen (14) days after the date this recommendation is entered. If objections are filed, any response is due within fourteen (14) days after the date the objections are filed. See FED. R. GIV. P. 72, 6.
Parties are advised that the failure to file objections within the specified time may waive the right to appeal the District Court's order. Martinez v. Ylst, 951 F.2d 1153 (9th Cir. 1991).