Hughes v. UPS Supply Chain Sols.

1

MARION HUGHES; JAMES A. CRUME; PHILLIP L. WESTERN; RAYMOND S. BATTS; AND TERRI A. ROGERS APPELLANTS v. UPS SUPPLY CHAIN SOLUTIONS, INC.; UNITED PARCEL SERVICE, INC. APPELLEES

No. 2021-SC-0444-DG

Supreme Court of Kentucky

August 24, 2023

RENDERED: MARCH 23, 2023

ON REVIEW FROM COURT OF APPEALS NO. 2019-CA-1457 JEFFERSON CIRCUIT COURT NO. 07-CI-009996

COUNSEL FOR APPELLANTS: Andrew Michael Grabhorn Michael Douglas Grabhorn Grabhorn Law Andrew John Horne Horne Law Office

COUNSEL FOR APPELLEES: Samuel Benjamin Goldstein Joseph Russell Palmore Morrison & Foerster, LLP Kyle Donald Johnson Charles Laurence Woods, III Frost Brown Todd, LLC John Choate Roach Ransdell Roach & Royce, PLLC

COUNSEL FOR AMICUS, AIRLINES FOR AMERICA: James Burton Lind Vorys, Sater, Seymour & Pease, LLP

COUNSEL FOR AMICUS, CHAMBER OF COMMERCE OF THE UNITED STATES OF AMERICA: Philip Williamson Taft Stettinius & Hollister, LLP

COUNSEL FOR AMICUS, INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS LOCAL UNION 369: Benjamin Sequoyah Basil Schulz Messex Dermody, PLLC

COUNSEL FOR AMICUS, INTERNATIONAL BROTHERHOOD OF TEAMSTERS LOCAL 783: Jerome Park Prather Garmer & Prather, PLLC

COUNSEL FOR AMICUS, KENTUCKY CHAMBER OF COMMERCE: Philip Williamson Taft Stettinius & Hollister, LLP

COUNSEL FOR AMICUS, KENTUCKY EQUAL JUSTICE CENTER: John Saoirse Friend Friend Law, PSC

COUNSEL FOR AMICUS, KENTUCKY JUSTICE ASSOCIATION: Michele Diane Henry Craig Henry, PLC

COUNSEL FOR AMICUS, KENTUCKY RETAIL FEDERATION: Philip Williamson Taft Stettinius & Hollister, LLP

COUNSEL FOR AMICUS, NATIONAL RETAIL FEDERATION: Philip Williamson Taft Stettinius & Hollister, LLP

ORDER DENYING PETITION FOR REHEARING

The Petition for Rehearing, filed by the Appellants, of the Opinion of the Court, rendered March 23, 2023, is DENIED.

On the Court's own motion, however, the Opinion of the Court, rendered on March 23, 2023, is modified and the Opinion of the Court is hereby ORDERED SUBSTITUTED for the Opinion originally rendered. The modification does not affect the holding of the original Opinion.

All sitting.

VanMeter, CJ, and Bisig, Conley, Keller, and Nickell, JJ, concur

Lambert and Thompson, JJ., dissent and would grant the petition for rehearing.

OPINION

VANMETER, CHIEF JUSTICE

In matters of statutory construction, courts have the duty to ascertain and give meaning to the intent of the legislature. In this case, our task is to determine whether KRS^[1] Chapter 337 encompasses the federal Portal-to-Portal provisions such that preliminary and postliminary activities, such as undergoing security screens, are non-compensable. Under customary rules of statutory construction, we hold that such activities are non-compensable and therefore affirm the Court of Appeals and the Jefferson Circuit Court.

I. Factual and Procedural Background.

This action was filed back in 2007 as a wage-and-hour class action by Marion Hughes^[2] against UPS Supply Chain Solutions and United Parcel Service, Inc.^[3] The complaint alleged that UPS violated KRS Chapter 337 by failing to compensate Class Members for time spent complying with mandatory security procedures upon entering/exiting UPS facilities. The allegations were that Class Members expended work time on (i) entering after complying with mandatory entry security procedures and before being permitted to clock-in and (ii) exiting after being required to clock-out and then complying with mandatory exit security procedures. The Class Members refer to this uncompensated time as "security time."

The long procedural history of this case is not particularly germane to the issue before us, since, as noted, that issue is one of statutory construction. Suffice to say that this case spent some time in the federal courts on UPS's attempt to remove it there,^[4] and then back in state court on whether it would proceed as a class action.^[5] Ultimately, the Court of Appeals affirmed the trial court's order certifying the class. UPS Supply Chain Sols., Inc. v. Hughes, No. 2014-CA-1496-ME, 2018 WL 3602262 (Ky. App. July 27, 2018).

Following the Court of Appeals' opinion affirming the trial court's class certification, UPS moved for judgment on the pleadings, arguing that "the time for which the Class was seeking compensation - time spent waiting for and undergoing security screenings - was not compensable under Kentucky law[]" based on the Portal-to-Portal Act, 29 U.S.C.^[6] §§ 251-262, and federal and Kentucky case law interpreting the federal Fair Labor Standards Act, 29 U.S.C. §§ 201- 219, the Portal-to-Portal Act and KRS Chapter 337. The Class Members' response was that because KRS Chapter 337 did not include language tracking the provisions of the Portal-to-Portal Act, specifically 29 U.S.C. § 254,^[7] our legislature had elected not to include those provisions and therefore they were inapplicable. The trial court granted UPS's motion and the Court of Appeals affirmed. We granted the Class Members' motion for discretionary review.

II. Standard of Review.

In this case, the trial court granted UPS's motion for partial judgment on the pleadings. CR 12.03. A motion for judgment on the pleadings "should be granted if it appears beyond doubt that the nonmoving party cannot prove any set of facts that would entitle him/her to relief." Mosley v. Arch Specialty Ins. Co., 626 S.W.3d 579, 585 (Ky. 2021); City of Pioneer Vill. v. Bullitt Cnty. ex rel. Bullitt Fiscal Ct., 104 S.W.3d 757, 759 (Ky. 2003). Such motions are "based purely on whether the plaintiff has stated a cause of action as a matter of law and do not require or permit the trial court to make any findings of fact." Mosley, 626 S.W.3d at 585 (footnote omitted). Because a trial court's ruling on a motion for judgment on the pleadings is a question of law, appellate review of a judgment on the pleadings is de novo. Id. (footnote omitted). Thus, we afford no deference to the lower court's opinions or rulings. Id. Similarly, we interpret statutes without deferring to lower courts' interpretations. Wheeler & Clevenger Oil Co. v. Washburn, 127 S.W.3d 609, 612 (Ky. 2004).

III. Analysis.

The issue presented is one of statutory construction, i.e., whether the Portal-to-Portal exceptions are contained within Kentucky's wage and hour provisions.

In matters of statutory construction, "our goal, of course, is to give effect to the intent of the [legislature]." Shawnee Telecom Res., Inc. v. Brown, 354 S.W.3d 542, 551 (Ky. 2011). To derive that intent, we look first to the statute's language, "giving the words their plain and ordinary meaning." Pleasant Unions, LLC v. Ky. Tax Co., 615 S.W.3d 39, 45 (Ky. 2021); see Shawnee Telecom, 354 S.W.3d at 551 (holding that intent is derived "from the language the [legislature] chose, either as defined by the [legislature] or as generally understood in the context of the matter under consideration[]"). "All words and phrases shall be construed according to the common and approved usage of language, but technical words and phrases, and such others as may have acquired a peculiar and appropriate meaning in the law, shall be construed according to such meaning." KRS 446.080(4). If the statutory language is plain and unambiguous, the legislature's intent is deduced from the language used. W. Ky. Coal Co. v. Nall &Bailey, 228 Ky. 76, 80, 14 S.W.2d 400, 401-02 (1929). On the other hand, if the language is ambiguous, we resort to rules of interpretation to guide our determination of the legislature's intent. Pleasant Unions, 615 S.W.3d at 45; MPM Fin. Group, LLC v. Morton, 289 S.W.3d 193, 198 (Ky. 2009).

In this case, KRS Chapter 337 is ambiguous in that it does not define "work," and contains no provision which addresses, either way, whether preliminary or postliminary activities constitute compensable work or time on the job. We acknowledge that KRS Chapter 337 "protects employees from the unlawful wage and hour practices of their employer." Mouanda v. Jani-King Int'l, No. 2021-SC-0089-DG, 653 S.W.3d 65, 2022 WL 3641175, at *3 (Ky. Aug. 18, 2022). KRS 337.010(1)(c)1 defines "wages" to include "any compensation due to an employee by reason of his or her employment, including salaries, commissions, vested vacation pay, overtime pay, severance or dismissal pay, earned bonuses, and any other similar advantages agreed upon by the employer and the employee or provided to employees as an established policy." An "employee," with exceptions not applicable to this case, is defined as "any person employed by or suffered or permitted to work for an employer[.]" KRS 337.010(1)(e). KRS 337.275 defines "minimum wage," but that provision does not specifically help our interpretation in this case. And, finally, and perhaps most pertinently, "any employer who pays any employee less than wages and overtime compensation to which such employee is entitled under or by virtue of KRS 337.020 to 337.285 shall be liable to such employee affected for the full amount of such wages and overtime compensation[.]" KRS 337.385(1).^[8]

To resolve this ambiguity, we are guided by both state administrative interpretation and federal case law. We discuss each in turn.

A. State Administrative Interpretation of KRS Chapter 337.

The legislature has empowered the Kentucky Labor Cabinet specifically the Kentucky Department of Workplace Standards, to issue administrative regulations "defining and governing" KRS Chapter 337. See KRS 337.295. Those agencies enjoy "wide discretion" in interpreting Kentucky law. Ky. Mun. League v. Commonwealth Dep't of Labor, 530 S.W.2d 198, 201-02 (Ky. App. 1975) (citing Butler v. United Cerebral Palsy of N. Ky., Inc., 352 S.W.2d 203 (Ky. 1961)). And the Department of Workplace Standard's administrative interpretation of Kentucky law serves as a basis for...