Litigating California Wage & Hour and Labor Code Class Actions

multiple entities control different aspects of the employment relationship, as when one entity, which
hires and pays workers, places them with other entities that supervise the work.” 525
The Court noted that the plaintiffs in Reynolds had conceded that “the plain language of Wage
Order No. 9 defining employer does not expressly impose liability under section 1194 on individual
corporate agents.” 526 “In a footnote, we added that the ‘plaintiff . . . ha[d] not persuaded us that one
may infer from the history and purposes of section 1194 a clear legislative intent to depart, in the
application of that statute, from the common law understanding of who qualifies as an employer.’” 527
The Martinez plaintiffs, however, gave the Court extremely detailed, exhaustive briefing on the
history of California’s minimum wage law, the IWC, and the Wage Orders. This apparently
convinced the Court that “an examination of section 1194 in its full historical and statutory context
shows unmistakably that the Legislature intended to defer to the IWC’s definition of the employment
relationship in actions under the statute.” 528 As a result, the Court limited the application of
Reynolds:
In sum, we hold that the applicable wage order‘s definitions of the employment
relationship do apply in actions under section 1194. The opinion in Reynolds, supra, 36
Cal.4th 1075, properly holds that the IWC‘s definition of employer does not impose
liability on individual corporate agents acting within the scope of their agency. (Reynolds,
at p. 1086.) The opinion should not be read more broadly than that. 529
525
526
527
528
529
Id. at 59.
Id. at 63.
Id. at 64.
Id.
Id. at 66. The Court of Appeal in Futrell v. Payday California, Inc. held that, because the language of Wage Order 12
and Wage Order 14 use identical language to define the terms “employ,” “employee” and “employer,” the Supreme
Court’s holding in Reynolds that applied Wage Order 14’s definition of “employment” also applies to Wage Order 12.
190 Cal. App 4th 1419, 1429 (2011).
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