Opinion
B224208
01-31-2012
GARY CHAFFEE, Plaintiff and Respondent, v. BOARD OF ADMINISTRATION OF THE CALIFORNIA PUBLIC EMPLOYEES' RETIREMENT SYSTEM et al., Defendants and Appellants.
Peter H. Mixon, Laurie Eavenson and Rory J. Coffey for Defendant and Appellant Board of Administration. Law Offices of Jimmy L. Gutierrez, Jimmy L. Gutierrez; Pollak, Vida & Fisher, Daniel P. Barer and Anna L. Birenbaum for Defendant and Appellant City of Rialto. McClung and Davis, Paul W. Davis and Charles E. McClung, Jr., for Plaintiff and Respondent.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
(Los Angeles County Super. Ct. No. BS120940)
APPEAL from an order of the Superior Court of Los Angeles County. David P. Yaffe, Judge. Affirmed.
Peter H. Mixon, Laurie Eavenson and Rory J. Coffey for Defendant and Appellant Board of Administration.
Law Offices of Jimmy L. Gutierrez, Jimmy L. Gutierrez; Pollak, Vida & Fisher, Daniel P. Barer and Anna L. Birenbaum for Defendant and Appellant City of Rialto.
McClung and Davis, Paul W. Davis and Charles E. McClung, Jr., for Plaintiff and Respondent.
The City of Rialto (Rialto) contracts with the California Public Employees' Retirement System (CalPERS) for CalPERS to provide retirement benefits to some of Rialto's employees. Section 20502 of the Public Employees' Retirement Law (PERL) (Gov. Code, § 20000 et seq.) permits a contracting agency such as Rialto to exclude identifiable groups of its employees from CalPERS enrollment if the Board of Administration (Board) of CalPERS agrees to the exclusion. (Undesignated section references are to the Government Code.) Pursuant to section 20502, the Rialto-CalPERS contract excludes from CalPERS employees in several job classifications, including "instructors" and "recreation aides." Plaintiff Gary Chaffee, a Rialto employee with the job titles of instructor and recreation aide, sought to avoid the exclusion on the ground that his duties were those of fitness manager, which was not an excluded position. An administrative law judge (ALJ) concluded Chaffee was properly excluded from CalPERS, and the Board adopted this conclusion as its own. Chaffee then successfully petitioned the superior court for a writ of mandate, ordering the Board to vacate its decision.
Rialto and the Board appeal from the order of the superior court. The issue on appeal is whether Chaffee was properly excluded because of his job title, notwithstanding his duties as fitness manager. We conclude that he was improperly excluded because his duties are controlling, not his job title. To decide otherwise would exalt form over substance. (Civ. Code, § 3528 ["The law respects form less than substance."].)
BACKGROUND
Rialto employs several "competitive service" employees under a merit system set forth in its municipal code, which establishes procedures for the selection of the employees and provides them with various benefits. (Rialto Mun. Code, § 2.50.060 et seq.) Rialto's competitive service employees are enrolled in a CalPERS retirement plan pursuant to a Rialto-CalPERS contract entered into in 1958. The original contract excluded school crossing guards.
In addition, Rialto employs dozens of noncompetitive service employees in positions that it classifies as "part time." Pursuant to Rialto's "Personnel Rules & Regulations," a "part-time" employee is "limited to one thousand (1,000) hours per fiscal year, except for positions excluded from PERS membership.'" (Italics added.) The Rules & Regulations provide that "[n]o employee benefits will accrue to part-time employees." Rialto's part-time employees are covered under a non-CalPERS deferred compensation retirement fund.
In 1987, Rialto sought to amend its contract with CalPERS to exclude, in addition to school crossing guards, the following positions: assistant pool manager; assistant recreation leader; cashier; landscape design trainee; lifeguard; locker attendant; pool manager; recreation aide; recreation leader; recreation specialist; and senior lifeguard. In seeking the amendment, Rialto gave the following explanation:
"The remainder of the classifications [to] be excluded are part-time, seasonal classifications in our Parks and Recreation Department. The incumbents in these classifications are high school or college students who are attracted to the positions because of the flexibility in work schedules; and the average length of employment is 1 1/2 years. The part time employees in the Recreation Department who are not students, have no desire to work full-time and are not career oriented. It would be a hardship for some of these employees if they had to enroll with PERS."
In 1988, Rialto requested that further positions be added to the list of excluded positions: instructor, instructor aide, and "Day Care Site Supervisor (PT)." It repeated its justification from the 1987 request and explained that "it has become a burden to continually accumulate hours for employees who will probably never reach qualifying status."
The Board approved Rialto's request, and on June 17, 1989, Rialto and the Board entered into an "Amendment to Contract" in which the following positions were excluded from CalPERS: "school crossing guards; [¶] . . . assistant pool manager; assistant recreation leader; cashier; landscape design trainee; lifeguard; locker attendant; pool manager; recreation aide; recreation leader; recreation specialist; senior lifeguard; instructor; instructor aide; and day care site supervisor (pt) . . . ." (Boldface & capitalization omitted, italics added.)
Chaffee was hired by Rialto in 1996 as an aerobics instructor. At the time, he had worked in the private sector for 26 years and was retired and had a pension. When hired, Chaffee signed an acknowledgment that he was "being hired on a part-time status with the Recreation and Community Services Department and that this position has no medical, dental or other such benefits afforded to it." He was classified as a recreation aide in 2000, was promoted to "Aerobics Instructor II" in 2002, and was reclassified as a recreation aide in 2003. His duties included managing Rialto's fitness center, in which capacity he was given several working titles, including "fitness manager." Working titles were designations used for the public's benefit to reflect the work employees performed, not their employment classifications. Chaffee's other working titles included fitness coordinator, fitness director, boot camp director, supervisor, aerobics coordinator, co-manager, operations specialist, and head of member services.
Chaffee applied for a competitive service position in Rialto's recreation department several times, but was unsuccessful.
From 1998 to 2006, Chaffee worked 40 hours per week almost every week.
In 2003, Chaffee sought CalPERS enrollment on the ground that although he worked 40 hours per week, Rialto designated him a part-time employee and failed to include him in the CalPERS retirement program.
In 2005, the Board wrote Rialto, questioning "whether Mr. Chaffee was properly excluded, since 'Recreation Aide' appears to be his only position that was specifically listed as being excluded. Furthermore, if Mr. Chaffee has been employed on a full-time basis since 1996, he certainly does not match the description of 'part-time, seasonal' employees who 'have no desire to work full-time and are not career-oriented,' which is the basis upon which we originally granted the exclusion." The Board asked Rialto to "review Mr. Chaffee's employment situation to determine whether he may have been improperly excluded from membership in CalPERS" and respond in writing.
Ultimately, in 2006, the Board denied the request because Chaffee's positions as recreation aide and instructor were excluded categories under the 1988 amendment to the Rialto-CalPERS contract. Although Chaffee worked on a full-time basis, the Board explained, the wording of the 1988 amendment did not limit exclusion to part-time employees but applied to all persons in designated positions, including instructor and recreation aide. The Board stated that the exclusions were "consistent with [Rialto's] original description of the class to be excluded ('the average length of employment is 1-1/2 years')": Forty-nine percent of employees in excluded classes worked for 12 months or less and 71 percent worked two years or less.
Chaffee filed an administrative appeal of the Board's determination. His sole argument on the administrative appeal was that he was entitled to membership in CalPERS because his employment responsibilities "did not fit the description of the part-time and seasonal classifications the CalPERS Board agreed to exclude under Rialto's contract. Allowing [Rialto] to avoid its obligations under the Retirement Law by misclassifying . . . employees," he argued, "would undermine the purposes of the Retirement Law . . . ." Chaffee argued that both Rialto and the Board had a duty under the PERL to classify him properly for retirement purposes.
In 2009, a two-day hearing was conducted. Chaffee testified that although at times his working title was fitness manager, he was never officially classified as a fitness manager, but remained a recreation aide. His schedule was theoretically flexible though he never availed himself of that flexibility. He asked to work 40 hours per week but was not required to do so. His working 40 hours per week was "voluntary to the extent that sometimes the job require[d] it." He never objected to working 40 hours.
At the administrative hearing, Scott Enoch, Rialto's recreational and community services advisor, who was Chaffee's supervisor at the fitness center, testified that he gave Chaffee the job title of fitness manager because that title "communicated his responsibility better" than the various official part-time job titles that were applied to Chaffee from time to time in Rialto's personnel records.
Enoch also testified that Chaffee was not required to work 40 hours per week, and if he would have asked to work only 20 hours per week, he would have been allowed to do so; only if Chaffee was excluded by contract from CalPERS enrollment would he have been permitted to work more than 1,000 hours per year.
Jean Wilkerson, a 15-year employee of Rialto's recreation department, testified that in her 11-plus years of working under Chaffee's supervision at the fitness center, she had never heard Chaffee referred to as a "recreation aide."
Documents admitted at the hearing showed that Chaffee has directed all of the fitness programs at the Rialto fitness center since 1998.
Rialto's annual performance evaluations for 1999, 2006, and 2008 contained the following.
In 1999, "The breadth and depth of [Chaffee's] knowledge in fitness and especially in business management has been invaluable in the operation of [Rialto Racquet & Fitness Center]"; "[Chaffee] is at the Center at all hours"; and "[Chaffee's] superior business management skill/abilities are all tremendously valuable to the organization."
In 2006, "[Chaffee] has recruited a great team for his many Programs"; and "[Chaffee] has had an excellent year for results. Personal training is in the thousands of dollars, boot camp over $20K and APEX combined with a weight watchers program is a great idea. [¶] All [his] efforts to create a fitness training empire are paying off. Keep up the great work!"
And in 2008, "Excellent management performance on programming w/projected revenues above 100% of previous year"; "Your management style prevents the need to solve problems by heading them off before they start"; "Making everyone feel welcomed (both your staff and members) and assisting them to greatness is your core strength"; and "Your management of staff, facilities and programming leads us to be a leader in our industry."
Wayne McAfee, Rialto's director of human resources, testified that Chaffee was a part-time employee pursuant to Rialto's definition of that term, even though he worked 40 hours per week. Although Rialto limits part-time employees to 1,000 hours per year, if they are excluded from CalPERS they may work more. McAfee testified that if Chaffee would have asked to work 20 hours a week, he would have been permitted to do so. He also testified that Rialto does not have part-time job descriptions.
Lynn Faulk-Damiano, manager of the membership account maintenance unit in CalPERS's Employer Services Division, testified that although Rialto in its 1987 letter to CalPERS characterized the excluded job positions as "seasonal," the Board did not consider them to be seasonal because the work did not fit the CalPERS definition of seasonal work. A seasonal worker, according to CalPERS, is "somebody who comes in on a seasonal basis. Like you may have agricultural people that come in to pick peaches and they're working on a seasonal basis. They work during a peak workload of time and then they're off." Faulk-Damiano testified that CalPERS does not approve exclusions based on job classification titles or even duties, but on the explanation given for the exclusion.
Faulk-Damiano further testified that if a particular position were classified as part-time but involved more than part-time work (defined by CalPERS as fewer than 1,000 hours per year), the discrepancy would not affect CalPERS's decision to approve or disapprove an exclusion grounded on some other characteristic. In fact, the exclusions in the Rialto-CalPERS contract made no reference to any employee's full-time or part-time status, but only to job classifications. Rialto's rationale for excluding instructors and recreation aides from CalPERS enrollment was that they tended not to work long enough to benefit substantially from CalPERS membership. For example, some CalPERS members may not receive retirement benefits if they retire with fewer than five years of service credit. CalPERS found the rationale continued to apply, as most employees in Rialto's excluded positions worked less than two years.
The ALJ issued a proposed decision setting forth his factual findings and legal conclusions. The ALJ found that Chaffee's "present working title is 'fitness manager' at the Racquet and Fitness Club owned by [Rialto]. Working titles were created by [Rialto] management so that the public could better understand what each employee actually did, rather than calling all of them 'recreation aide' which would be difficult for the public to recognize." Chaffee was not required to work 40 hours per week, and could have worked as little as 20 hours per week had he wanted to. Chaffee's progression from working part-time to working 40 hours per week did not change his part-time classification or move him into a full-time classification that requires a competitive employment examination. Because Chaffee's employment was not seasonal or temporary, section 20305, which mandates inclusion in CalPERS for some seasonal and temporary employees, did not apply. The ALJ concluded: "Chaffee was, and is, classified as a part-time excluded employee. The fact that he chose to work 40 hours, for a long period of time, does not change the fact that he was hired as an excluded employee and remains so to this day. To find otherwise would negate the whole purpose of what is allowed by statute, i.e.[,] allowing [Rialto], with approval by PERS, to exclude certain job classifications from receiving PERS benefits. While this outcome does not favor Chaffee, those employees who worked less than two years benefited by not having retirement contributions withheld from their check for retirement benefits that ultimately would not vest within two years and then later having to seek a refund of those funds." The ALJ denied Chaffee's request for CalPERS enrollment.
On February 19, 2009, the Board adopted the proposed decision as its own.
Chaffee petitioned the superior court for a writ of mandate pursuant to Code of Civil Procedure section 1094.5 to compel the Board to set aside its February 19, 2009 decision adopting the ALJ's proposed decision and enter a new decision ordering that Chaffee be enrolled in CalPERS retroactive to June 1, 1998, the date he began working full time for Rialto.
The trial court initially issued a tentative order denying the petition on the ground that Chaffee's dispute was with Rialto, not the Board, and the Board had no duty or power to compel Rialto to classify Chaffee properly. The Board's only duty, the court tentatively concluded, was to ensure that Rialto's exclusion did not adversely affect the fiscal or actuarial soundness of the retirement system. During the hearing, the court requested supplemental briefing addressing the tentative ruling.
After the second round of briefing and a second hearing, the trial court issued an order granting Chaffee's petition. The court observed that Chaffee's "duties have included working as a Fitness Manager performing managerial duties." The court determined that Chaffee was an employee under section 20305, subdivision (a)(3)(B) because although he was initially hired on an irregular basis, he had worked full time for more than ten years. The court reasoned that under Metropolitan Water Dist. v. Superior Court (2004) 32 Cal.4th 491 (MWD) Rialto could not render an employee ineligible for CalPERS membership "by the mere act of placing him in a 'category that consists mainly of part-time employees or employees employed on an irregular basis,' when in fact the employee works full-time in a position that constitutes an employee under California common law." The court stated that participation in CalPERS "does not depend on whether an agency chooses to classify an employee as eligible for benefits" because "'[s]uch an interpretation could lead, contrary to the letter and spirit of the law, to a patchwork of standards set by local agencies rather than a uniform definition set and applied by the CalPERS Administering Board.' The legislative intent in enacting PERL was to establish a single system-wide standard of eligibility, not various standards by individual participating agencies," quoting MWD, at page 505.
Rialto and the Board appealed.
DISCUSSION
The parties agree that Chaffee cannot be excluded from CalPERS on the ground he was a part-time employee because he worked more than 1,000 hours per fiscal year. Instead, Rialto relies on Chaffee's job titles of instructor and recreation aide to exclude him from CalPERS, notwithstanding that his duties as fitness manager did not fall within an excluded position. We disagree with Rialto because MWD, supra, 32 Cal.4th 491, Boxx v. Board of Administration (1980) 114 Cal.App.3d 79 (Boxx), and Noroian v. Department of Administration (1970) 11 Cal.App.3d 651 (Noroian) focus on form and not substance, that is, the duties of an employee and not the job title assigned to him.
We generally review the record in an administrative mandamus proceedings to determine whether the trial court's judgment is supported by substantial evidence. But when the evidence is undisputed and not subject to conflicting inferences, we independently review the administrative agency's action. (Stermer v. Board of Dental Examiners (2002) 95 Cal.App.4th 128, 132-133.) Here, the facts are undisputed. The issue is whether Chaffee was properly excluded from CalPERS enrollment pursuant to the PERL. It is a question of law that we determine de novo.
"The purpose of [the PERL] is to effect economy and efficiency in the public service by providing a means whereby employees who become superannuated or otherwise incapacitated may, without hardship or prejudice, be replaced by more capable employees, and to that end provide a retirement system consisting of retirement compensation and death benefits." (§ 20001.) Participation in CalPERS is by contract between a public agency and the Board.
The public agency may make all or only some of its employees members of the system (§ 20460), but any exclusion from membership must "be based on groups of employees such as departments or duties, and not on individual employees" (§ 20502). The Board "may disapprove the exclusion of a group, if in its opinion the exclusion adversely affects the interest of this system." (Ibid.; MWD, supra, 32 Cal.4th at pp. 499500.) In other words, once a public agency contracts to make any of its employees members of CalPERS, all of its employees must be made members unless the Board approves specific, group-based exclusions. (MWD, at pp. 505-506.)
In 1958, Rialto and the Board contracted for retirement services for Rialto's employees. In 1989, Rialto and the Board contracted to exclude some of Rialto's job classifications from CalPERS, including recreation aide and instructor. Under section 20502, this was permissible.
It is undisputed that Chaffee was hired in 1996 as a recreation aide and served for a time as an instructor, but he eventually took over the management of the fitness center, and the title "fitness manager" described his position and duties. And Rialto mischaracterized Chaffee as a part-time employee.
Chaffee contends that the authorities of MWD, Boxx, and Noroian compel Chaffee's admission to CalPERS membership based on his duties, not his job title. We agree.
MWD prohibits a contracting agency from creating its own pension exclusion by simply applying a label like "independent contractor"; similarly, Rialto cannot create its own pension exclusion by applying a label of "part-time" instructor or recreation aide that does not conform with the job characteristics and duties an employee actually performs. In MWD, the Metropolitan Water District of Southern California (the District) contracted with CalPERS for retirement benefits for its "employees." (32 Cal.4th at p. 500.) In addition to maintaining regular employees on its payroll, who were enrolled in CalPERS, the District used long-term contract workers obtained from private labor suppliers. It classified these workers as "'consultants'" or "'agency temporary employees'" and refused to enroll them. (MWD, at pp. 497-499.) The District argued they were not its employees for purposes of enrollment because they were paid through private labor suppliers. (Id. at pp. 501 -503.)
The Supreme Court disagreed. It observed that section 20028, subdivision (b) defines "'employee'" as "'[a]ny person in the employ of any contracting agency.'" (MWD, supra, 32 Cal.4th at p. 500.) Applying the maxim that a statutory term with an accumulated settled meaning under the common law must be read as incorporating that meaning unless the statute otherwise dictates (ibid.), the court held that the PERL requires enrollment of all common law employees "except those excluded under a specific statutory or contractual provision." (Id. at p. 496.)
The District argued that workers who were hired without going through the agency's normal merit selection procedures should not be entitled to full employee benefits. The Supreme Court rejected the argument, observing that exclusion from CalPERS could not be based on such a rationale. "Participation in the CalPERS retirement system does not depend on whether an agency chooses to classify an employee as eligible for benefits under civil service or local merit selection rules," the court held. "Such an interpretation could lead, contrary to the letter and spirit of the law, to a patchwork of standards set by local agencies rather than a uniform definition set and applied by the CalPERS administering board." (MWD, supra, 32 Cal.4th at p. 505.) The court noted that the Board has sole authority to determine who are employees and may disapprove an agency's proposal to exclude a group of employees. (Ibid., citing §§ 20125, 20502.)
Boxx, supra, 114 Cal.App.3d 79, and Noroian, supra, 11 Cal.App.3d 651, establish that the Board must determine whether an employee is qualified for a pension by examining the duties the employee actually performs.
In Boxx, the Housing Authority of the City of Los Angeles (HACLA) contracted with CalPERS to provide retirement benefits to all of its employees except "'local safety members.'" It classified Otis Boxx, Jr., one of its patrolmen, as a "'miscellaneous member'" and collected retirement contributions from him and made contributions to CalPERS on his behalf. Boxx was injured in the scope of his employment after four years on the job and sought disability retirement benefits. He did not qualify for benefits as a miscellaneous member because he had only four years' service credit instead of the required five (former § 21021), so he sought retirement as a local safety member. The Board found that Boxx qualified as a local safety member but denied him benefits because local safety members were excluded from the HACLA/CalPERS contract. (Boxx, supra, 114 Cal.App.3d at pp. 82-83.) The trial court issued a writ of mandate requiring HACLA and the Board to reclassify Boxx as a local safety member and grant him benefits.
The appellate court agreed. Pursuant to the version of section 20019 then in effect, "'[l]ocal safety member'" included all local policemen. Pursuant to former section 20020, a "'[l]ocal policeman'" meant any officer of a local police department except one performing primarily clerical duties. (Boxx, supra, 114 Cal.App.3d at pp. 83-84 & fn. 5.) "The key issue [was] whether [Boxx's] duties were within the scope of active law enforcement under [former] section 20020." (Boxx, at p. 86.) The court examined Boxx's duties, compared them to the definitions of "local safety member" found in section 20020 and of "police" found in statutes and case law, and determined that his duties were those of a policeman and local safety member. (Boxx, at pp. 86-87.) The court then ordered that the HACLA-CalPERS contract be reformed to remove the exclusion of local safety members because HACLA and CalPERS had intended that persons such as Boxx, who was a safety member, be enrolled. (HACLA had collected retirement contributions from Boxx and made contributions on his behalf.) (Boxx, at pp. 88-89.)
In Noroian, supra, 11 Cal.App.3d 651, Charles Noroian, a Department of Corrections employee who worked as a foreman in a correctional facility's wood shop, sought retirement benefits pursuant to former section 21292.8, which provided for disability retirement for corrections employees who had "custodial duties." (Noroian, at p. 653.) Noroian argued his duties were custodial because he was required to receive periodic training in ways to quell altercations, on occasion broke up fights, and was required to take into custody any inmate who violated prison regulations. (Noroian, at pp. 653-654.) CalPERS's Department of Administration argued Noroian's duties were not primarily custodial within the contemplation of section 21292.8. The appellate court disagreed. As in Boxx, the court examined the employee's duties, compared them to statutory requirements, and found the employee performed duties envisioned by statute. "[T]he 'custodial duties' envisioned by section 21292.8 are those actually performed by an employee," the court held, "and not necessarily those which are provided for in his job description and duties." (Noroian, supra, 11 Cal.App.3d at p. 656.)
Accordingly, based on his duties as a full-time fitness manager, Chaffee is entitled to be included in CalPERS.
DISPOSITION
The order is affirmed. Chaffee is awarded costs on appeal.
NOT TO BE PUBLISHED.
MALLANO, P. J. I concur:
JOHNSON, J. CHANEY, J., Dissenting.
In 1989, the Board of Administration (Board) of the California Public Employees' Retirement System (CalPERS) agreed with the City of Rialto to exclude instructors and recreation aides from CalPERS enrollment because they generally worked for a short term, i.e., less than two years, and would thus not benefit from enrollment. The Board is expressly authorized to accept (or deny) such an exclusion. (Metropolitan Water Dist. v. Superior Court (2004) 32 Cal.4th 491, 499-500 (MWD) ["The contract between a participating agency and CalPERS may exclude some of the agency's employees, but '[t]he exclusions of employees . . . shall be based on groups of employees such as departments or duties, and not on individual employees.' (§ 20502)"].) In 2006, the Board analyzed Rialto's employment patterns and found the rationale given in 1989 continued to apply because more than half of Rialto's recreation aides worked for less than two years.
Chaffee contends he was improperly excluded from CalPERS on the basis of his job title, which did not match the duties he actually performed. The contention is without merit.
To determine whether a worker is misclassified for purposes of a CalPERS exclusion, the characteristics of the pertinent employment classification must be compared to duties actually performed by excluded workers. For example, in MWD, supra, 32 Cal.4th 491, the Metropolitan Water District of Southern California (MWD or the District) contracted with CalPERS to provide retirement benefits for its "employees." (Id. at p. 500.) The District excluded from CalPERS membership workers hired through private labor suppliers on the ground that they were not employees because they had not been hired under a merit system set forth in the District's administrative code. (Id. at p. 497.)
The Supreme Court first examined the characteristics of the "employee" classification. It held that for purposes of CalPERS, once the District set out to provide CalPERS benefits for "employees," it could not privately define that term in a manner that would exclude workers who would be considered employees under the common law test as set forth in Tieberg v. Unemployment Insurance Appeals Board (1970) 2 Cal.3d 943 and the Second Restatement of Agency. (MWD, supra, 32 Cal.4th at p. 499.) Under Tieberg, "[t]he principal test of an employment relationship is whether the person to whom service is rendered has the right to control the manner and means of accomplishing the result desired. [Citation.] If control may be exercised only as to the result of the work and not the means by which it is accomplished, an independent contractor relationship is established." (Tieberg, at pp. 946-947; Rest.2d Agency, § 220, pp. 485-486.)
Section 220 of the Second Restatement of Agency sets forth the following definition of a servant:
"(1) A servant is a person employed to perform services in the affairs of another and who with respect to the physical conduct in the performance of the services is subject to the other's control or right to control.
(2) In determining whether one acting for another is a servant or an independent contractor, the following matters of fact, among others, are considered:
(a) the extent of control which, by the agreement, the master may exercise over the details of the work;
(b) whether or not the one employed is engaged in a distinct occupation or business;
(c) the kind of occupation, with reference to whether, in the locality, the work is usually done under the direction of the employer or by a specialist without supervision;
(d) the skill required in the particular occupation;
(e) whether the employer or the workman supplies the instrumentalities, tools, and the place of work for the person doing the work;
(f) the length of time for which the person is employed;
(g) the method of payment, whether by the time or by the job;
(h) whether or not the work is a part of the regular business of the employer;
(i) whether or not the parties believe they are creating the relation of master and servant; and
(j) whether the principal is or is not in business."
The MWD Court then examined the workers' actual duties and compared them to the "employee" classification. The workers had alleged "they worked at MWD for indefinite periods, in some cases several years; that MWD managers interviewed and selected them for employment; that they were integrated into the MWD workforce and performed, at MWD offices or worksites, duties that are part of MWD's regular business; that MWD supervisors directly oversaw and evaluated their work, determined their hourly rates of pay, raises, and work schedules, approved their timesheets, and had the power to discipline and terminate them; and in general that MWD had the full right to control the manner and means by which they worked, while the labor suppliers merely provided MWD with 'payroll services.'" (32 Cal.4th at pp. 498-499.) The Court held that "[s]uch facts, if proven, might support an argument that plaintiffs are MWD's employees under the established common law test . . . ." (Id. at p. 499.)
The court in Boxx v. Board of Administration (1980) 114 Cal.App.3d 79 (Boxx) conducted a similar analysis. The issue was whether Otis Boxx, who worked for the Housing Authority of the City of Los Angeles (HACLA), was a "local safety member" as defined in former Government Code sections 20019 and 20020. Section 20019 provided that the term "local safety member" included a "local policeman." Section 20020 provided that to be classified as a "local policeman," one must be engaged in "active law enforcement service." (Former Gov. Code, § 20020; Boxx, at p. 84 & fn. 5.) The Boxx court relied on Crumpler v. Board of Administration (1973) 32 Cal.App.3d 567 for a definition of the phrase "active law enforcement." There, quoting the Attorney General, the court stated that active law enforcement includes "'the active investigation and suppression of crime; the arrest and detention of criminals . . . ."' (Id. at p. 577, quoting from 22 Ops.Cal.Atty.Gen. at p. 229; see Boxx, supra, at p. 86.)
The Boxx Court then examined Otis Boxx's actual duties and compared them to his employment classification. The facts showed that he "was uniformed, armed and designated as a peace officer. [He] was also required to make arrests for criminal activity occurring in and around HACLA property. In May of 1975 he was sworn in as a 'peace officer.'" (114 Cal.App.3d at p. 86.) In addition, "[a]ccording to Housing Authority of the City of Los Angeles Manual of Policies and Operations for HACLA Patrol Officers, the primary duties of a patrolman are '. . . the preservation of peace within the housing developments, the protection of life and property therein against attacks by criminals or injury by the careless and inadvertent offender.'" (Ibid.) The Boxx court held that pursuant to this standard, Otis Boxx's "primary duty" "was the 'active investigation and suppression of crime' and 'the arrest and detention of criminals.'" (Id. at p. 87.) He thus fell within the "local safety member" classification.
In Noroian v. Department of Administration (1970) 11 Cal.App.3d 651 (Noroian), Charles Noroian, who worked in a correctional facility's wood shop, sought retirement benefits under former Government Code section 21292.8, which provided such benefits for those who performed "custodial duties." (Id. at p. 653.) To determine the meaning of "custodial duties," the court, after making "inquiry into sundry sources," relied on Ralston v. State Employees' Retirement System (1969) 273 Cal.App.2d 228, 237, which held that custodial duties included apprehending individuals and returning them to custody. The Noroian court noted that Charles Noroian on occasion "broke up fights between inmates using pipes and wooden clubs" and "was required to take any inmate guilty of violating any prison regulation into custody and escort the latter to an officer for the issuance of a citation." (Noroian, at p. 654.) He "spent a substantial portion of his employment time watching the inmates under his control" and "did, on occasion, subdue inmates and take them into restrictive custody." (Id. at p. 656.) The court held he "thus performed duties custodial in nature." (Ibid.)
In each of these cases the reviewing court evaluated the duties inhering in a subject classification and compared them with the employee's actual duties to determine whether the employee fell within the classification. The cases relied upon by MWD, Boxx and Noroian conducted the same analysis. The Supreme Court in Tieberg v. Unemployment Ins. App. Bd., upon which the Court in MWD relied, itself relied on Isenberg v. California Emp. Stab. Com. (1947) 30 Cal.2d 34 and Moody v. Industrial Acc. Com. (1928) 204 Cal. 668 for its employment test. (Tieberg, supra, 2 Cal. 3d 943, 946-947.) The court in Crumpler v. Board of Administration, cited by Boxx, relied on the Attorney General for a definition of the phrase "active law enforcement service." (32 Cal.App.3d at p. 577.) The court in Ralston v. State Employees' Retirement System, cited by Noroian, examined the legislative history of former Government Code section 21292.8 to determine the meaning of "custodial duties." (273 Cal.App.2d at pp. 236- 237.)
The lesson is that some standard must be applied by which to characterize the employment classification and determine whether an employee's duties fall within the scope of the classification.
Here, Chaffee identifies no such standard and, in fact, ignores the need for one. Instead, in conclusory fashion he simply exchanges one label for another, contending he is a "fitness manager," not a "recreation aide." In doing so he employs a classification everyone agrees is fictional and relies on the unstated premise that an employee who performs managerial duties cannot be a mere "aide." That premise has no basis in reason and is belied by the record.
According to the record, the City of Rialto's recreation department was headed by the "Director of Recreation and Community Services," also called the "Recreation Director." Under that position was the "Recreation Manager," also called the "recreation and community services manager." Under the Recreation Manager was the "recreation and community services supervisor," who headed the Rialto Racquet & Fitness Center under the working title "General Manager." Under the fitness center's general manger were various subordinate, coequal positions, including "Fitness Manager," "Front Counter Manager," "Babysitting Manager," "Pool Manager," "Pro Shop & Snack Bar" manager, and, at other times, "Fitness Director" and "Operations Manager."
Chaffee was hired in 1996 as a recreation aide, served for a time as an "instructor," and then returned to his former classification, where he remained, his three attempts to obtain a different job proving unsuccessful. For years he has worked for the Rialto Racquet & Fitness Center as its "Fitness Manager." It is undisputed that "Fitness Manager" is not a recognized employment classification with the City of Rialto, but rather a working title describing the employee's duties, created to facilitate public relations.
Under Rialto's employment scheme, recreation aides performed a variety of functions, including some that involved supervision of other employees. For example, Amber Wood, a recreation aide, worked as the fitness center's "operations manager," handling its membership, billing, the scheduling of the front staff, and supervising lower-level employees, including recreation leaders, recreation specialists, and even other recreation aides. Christina Holguin, also a recreation aide, also worked as the fitness center's operations manager.
Unlike in MWD, where the definition of "employee" was established by the common law, or Boxx, where the duties of a "local safety member" were described in case law and by the Attorney General, or Noroian, where the definition of "custodial duties" was set forth in the legislative history of former Government Code section 21292.8, no authority defines a recreation aide. The City of Rialto thus had a right to establish the duties a recreation aide shall perform. It did so in practice by permitting its recreation aides to perform a number of managerial duties. If anything, Rialto's system of labeling recreation aides according to their actual duties (e.g., "fitness manager" or "operations manager") was itself a description of the duties inhering in the classification. There was thus no divergence between Chaffee's duties as fitness manager and classification as a recreation aide.
Chaffee implicitly argues that the functions of a recreation aide are incompatible with those of a fitness manager. The argument must be rejected outright because Chaffee offers no standard by which to define a recreation aide or its duties. At any rate, the common definition of "aide" is "a person who acts as an assistant." (Webster's 3d New Internal Dict. (1993) p. 45.) It is undisputed that the Rialto Racquet & Fitness Center's fitness manager was subordinate to and assisted the center's "General Manager." The fitness manager was thus the general manager's aide. Nothing prohibits an aide from performing supervisory functions.
In sum, Chaffee purports to agree that his duties, not his job title, should control for purposes of CalPERS enrollment but does not in fact identify any divergence between the two. Instead, he summarily concludes with no discernable basis that management of a fitness center is incompatible with the recreation aide classification. This result offers no guidance to employers or the Board and, if emulated, would lead to precisely the patchwork of local standards that the PERL was designed to avoid. (See City of Los Altos v. Board of Administration (1978) 80 Cal.App.3d 1049, 1051-1052 [legislative intent was for a single system-wide standard of eligibility, not various standards set by individual participating agencies].) No longer could the Board make objective determinations regarding classes of employees, but each individual's duties would have to be measured against some standardless, subjective, post hoc definition conjured up to reach a desired result. The Board would become the de facto arbiter not of the relationship between duties and classifications, but of the fictional names a contracting agency may give to any particular set of duties. It is ill equipped to make such decisions.
Chaffee also contends public policy and equity favor his inclusion in CalPERS. He argues that the absence of clearly defined job descriptions for employees in excluded groups permitted Rialto arbitrarily to move individual employees into and out of excluded groups by applying "official" titles and classifications that do not match the employees' duties. This manipulation of job titles and classifications circumvents compulsory employee participation requirements of the PERL, Chaffee argues, and thwarts its fundamental purpose, which is to provide retirement benefits to a long-term, full-time employee who has reached the age of retirement after providing years of valuable public service to the community.
I disagree. The City of Rialto classified personnel as recreation aides and gave them limited duties and few hours. If a recreation aide desired, he or she would be given more hours and duties, so long as he or she agreed to remain a recreation aide. Chaffee so agreed, in writing. If Rialto eschewed job descriptions and freely moved employees into and out of positions, the result was flexibility and opportunity, not oppression. By default, Rialto's system limited "part-time" employees to part-time hours, presumably in positions of little professional responsibility (for example lifeguard, crossing guard, cashier, landscape design trainee, or locker attendant). If employees chose to do so, they could work more hours and receive greater authority and responsibilities, so long as they continued to work within the part-time classification. Presumably Chaffee found this to be of benefit, as he did not seek fewer hours or less responsibility, but more hours and greater responsibility. No authority required the City of Rialto to confine its employees to rigidly defined duties, and nothing about the city's system could fairly be called manipulative or arbitrary.
And nothing deprived valuable, long-term employees of retirement benefits. As the Board's investigation in 2006 revealed, 71 percent of Rialto's excluded employees were not long-term, but worked for less than two years, and all short-term employees were invited to participate in a deferred compensation retirement plan. Specifically as to Chaffee, no inequity has resulted, as he knowingly accepted his classification. He was already retired with a pension, was entitled to participate in Rialto's deferred compensation plan, and benefitted from being permitted to work full-time rather than part-time. I do not mean to imply that Chaffee is financially secure or that CalPERS enrollment would not have benefitted him, only that he received the bargain he signed up for when he sought and continued in employment with Rialto.
I therefore would reverse.
CHANEY, J.