Non-Agricultural Employers May Use Workweek Averaging To Satisfy State Minimum Wage Obligations In Washington

Jackson Lewis P.C.

On September 5, 2019, the Washington Supreme Court confirmed that non-agricultural employers may use a workweek averaging methodology to satisfy the Washington Minimum Wage Act in Valerie Sampson et al v. Knight Transportation Inc. et al. In other words, non-agricultural employers can satisfy their state minimum wage obligations by showing that an employee’s total wages for a workweek, when divided by the total hours worked during that week, results in a figure that is equal to or greater than the state minimum wage.

Workweek averaging is a well-accepted concept as a matter of federal law. It had also been a long-accepted practice in Washington in both the agricultural and non-agricultural contexts. However, an employer’s ability to use that methodology to satisfy its minimum wage obligation in a nonagricultural setting was recently thrown into question as a result of the Washington Supreme Court opinion in Carranza v. Dovex Fruit Co., 190 Wn.2d 612 (2018). In Carranza, the Court held that workweek averaging was not permitted in an agricultural setting. Instead, the Court ruled that employers must pay their employees at least the minimum wage for each hour worked. This meant that employers who paid their employees on a piece rate basis, for example by the amount of fruit that was picked, had to separately and hourly pay their employees for work that was not directly related to the picking of fruit (e.g., traveling between orchards, attending meetings, storing and maintaining equipment and materials, etc.).

In Sampson, the Court considered a certified question from the United States District Court for the Western District of Washington, which posed the question “Does the Washington Minimum Wage Act require non-agricultural employers to pay their piece-rate employees per hour for time spent performing activities outside of piece-rate work?” Essentially, the Court was tasked with determining whether the rule established by Carranza in an agricultural setting would be applied to non-agricultural employers. In a 6-3 decision, the Sampson Court responded in the negative, and affirmed the validity of workweek averaging as set forth in WAC 296-126-021.

While Sampson arose in a transportation context – involving truck drivers who were paid by the mile – its application extends well beyond the specifics of that industry and provides relief to all non-agricultural employers who pay their employees on a piece rate or commission basis.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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