Kilby v. CVS Pharmacy, Inc.

Facts

The regulatory text. Two Industrial Welfare Commission wage orders — No. 4-2001, covering professional, technical, clerical, mechanical and similar occupations, and No. 7-2001, covering the mercantile industry — carry identical seating provisions. Subdivision (A) of section 14 in each states that “[a]ll working employees shall be provided with suitable seats when the nature of the work reasonably permits the use of seats.” (Kilby v. CVS Pharmacy, Inc. (2016) 63 Cal.4th 1, 8, quoting Cal. Code Regs., tit. 8, §§ 11040, subd. 14(A), 11070, subd. 14(A).) Subdivision (B) addresses a different moment: “When employees are not engaged in the active duties of their employment and the nature of the work requires standing, an adequate number of suitable seats shall be placed in reasonable proximity to the work area and employees shall be permitted to use such seats when it does not interfere with the performance of their duties.” (Id. at p. 9.) Whether those two subdivisions are mutually exclusive drove the litigation below.

The regulatory pedigree. The court traced the provision to 1911, when the Legislature required mercantile employers to “provide suitable seats for all female employees.” (Kilby, supra, 63 Cal.4th at p. 11, quoting Stats. 1911, ch. 258, § 2, p. 437.) Orders in 1919, 1947 and 1968 carried the concept forward. (Id. at pp. 11–12.) From that survey the court drew the point that anchors the opinion: “This review demonstrates that the ‘nature of the work’ involved has been an aspect of these regulations since at least 1919.” (Id. at p. 12.) In 1976 the IWC added the word supplying the modern standard, requiring seats “when the nature of the work reasonably permits the use of seats.” (Id. at p. 13.)

Kilby. Nykeya Kilby worked eight months as a customer service representative for CVS Pharmacy, Inc. CVS told her during both the interview and training that it expected her to stand while performing her duties. Her duties, which “varied by both store and shift,” “included operating a cash register, straightening and stocking shelves, organizing products in front of and behind the sales counter, cleaning the register, vacuuming, gathering shopping baskets, and removing trash.” CVS gave her no seat for any of them. (Kilby, supra, 63 Cal.4th at p. 9.)

Henderson. Kemah Henderson and three other JPMorgan Chase Bank, N.A., tellers sued under the parallel provision of Wage Order No. 4-2001. Their duties included station work — “accepting deposits, cashing checks, and handling withdrawals” — and duties away from the station, “such as escorting customers to safety-deposit boxes, working at the drive-up teller window, and making sure that automatic teller machines were working properly.” Those duties varied by shift, branch, and whether the teller was a lead. (Id. at p. 10.)

The interpretive backdrop. IWC wage orders are quasi-legislative regulations, and “IWC regulations are liberally construed to protect and benefit employees.” (Kilby, supra, 63 Cal.4th at p. 11.) They “are to be accorded the same dignity as statutes.” (Ibid., quoting Brinker Restaurant Corp. v. Superior Court (2012) 53 Cal.4th 1004, 1027.) The Division of Labor Standards Enforcement’s views drew attention but not deference: its “enforcement policies are not entitled to deference because they were not adopted in compliance with the Administrative Procedure Act,” though they may “be persuasive as precedents in similar subsequent cases.” (Id. at p. 13.) DLSE and IWC letters from 1979 through 1987, and the DLSE’s amicus briefs in Garvey v. Kmart Corp. and in this case, occupy pages 14 through 16 and supplied a long enforcement history favoring case-by-case reasonableness.

Procedural history

In Kilby, the United States District Court for the Southern District of California granted CVS summary judgment. It held sections 14(A) and 14(B) “mutually exclusive,” reasoning that subdivision (A) governs when an employee is actively working and subdivision (B) when the employee is not, so that assessing the “nature of the work” under section 14(A) required considering an employee’s “entire range of assigned duties.” It observed that “there is no dispute that many of the duties performed by Clerk/Cashiers at CVS require the employee to stand while performing them.” Kilby appealed. (Kilby, supra, 63 Cal.4th at p. 9.)

In Henderson, the United States District Court for the Central District of California denied class certification, resting on the variation in teller duties by shift, branch, and lead status. Henderson appealed. (Id. at p. 10.)

The Ninth Circuit, which had addressed the seating question in the Kilby appeal (see 739 F.3d 1192), certified three questions under California Rules of Court, rule 8.548. The Supreme Court reframed them, as rule 8.548(f)(5) permits, and answered them. (Kilby, supra, 63 Cal.4th at p. 8 & fns. 1–2.) The posture is easily misread: this is an answer on questions of California law, not a merits disposition. The court entered judgment for no one and decided neither plaintiff’s entitlement to a seat, “answer[ing] the certified questions as set out at page 8, ante, as amplified by our subsequent discussion.” (Id. at p. 24.)

Issue

As reframed by the court, three questions were presented. First, does “nature of the work” refer “to individual tasks performed throughout the workday, or to the entire range of an employee’s duties performed during a given day or shift”? Second, in determining whether the nature of the work “reasonably permits” a seat, “what factors should courts consider” — specifically, are “an employer’s business judgment, the physical layout of the workplace, and the characteristics of a specific employee relevant factors”? Third, “[i]f an employer has not provided any seat, must a plaintiff prove a suitable seat is available in order to show the employer has violated the seating provision?” (Kilby, supra, 63 Cal.4th at p. 8.)

Holding

Reasoning

1. The text, read against the regulation’s purpose. “Questions about the ‘nature of the work’ and when that work ‘reasonably permits the use of seats’ are analytically distinct. Yet, the answers to those questions are necessarily intertwined,” and the former “cannot be meaningfully answered without consideration of the underlying purposes of the seating requirement, in light of the objective standards imposed by the wage orders.” (Kilby, supra, 63 Cal.4th at p. 16.) That framing predetermined a good deal: neither a reading that defeated the protective purpose nor one that made the requirement absolute would survive.

2. The employers’ “holistic” test would let standing tasks swallow sitting ones. CVS and Chase argued that entitlement turns on the job as a whole — weigh all standing tasks against all sitting tasks and classify the job accordingly. The court rejected it: “Defendants’ argument sweeps too broadly and is inconsistent with the purpose of the seating requirement.” (Kilby, supra, 63 Cal.4th at p. 16.) The defect was granularity: the approach “ignores the duration of those tasks, as well as where, and how often, they are performed,” producing an all-or-nothing result. (Id. at p. 17.) “There is no principled reason for denying an employee a seat when he spends a substantial part of his workday at a single location performing tasks that could reasonably be done while seated, merely because his job duties include other tasks that must be done standing.” (Ibid.)

The court then supplied the hypothetical that has done most of the doctrinal work since. Two employees perform identical register work; one mostly stocks shelves and occasionally covers a register, the other spends most of the day at the register. On the employers’ theory the second gets a seat and the first does not, for the same task at the same place. “Nothing in the language or history of the seating requirement allows such disparate treatment of employees performing the same tasks.” (Ibid.) From that came the operative rule: “The inquiry does not turn on the individual assignments given to each employee, but on consideration of the overall job duties performed at the particular location by any employee while working there, and whether those tasks reasonably permit seated work.” (Ibid.) That sentence — not the job-versus-task framing — is the working holding on question one, and it is what gives the claim classwide traction.

3. The plaintiffs’ single-task test failed too. The court was equally unwilling to hold that any single seatable task triggers the entitlement; that “view is too narrow and likewise inconsistent with the language and history of section 14(A).” (Kilby, supra, 63 Cal.4th at p. 17.) The 1976 addition of “reasonably” was deliberate — the IWC was making the requirement “more flexible and more subject to administrative judgment as to what is reasonable.” (Ibid.) Hence: “The seating requirement has never been understood as absolute or doctrinaire,” and the standard “was intended to balance an employee’s need for a seat with an employer’s considerations of practicability and feasibility.” (Id. at p. 18.)

4. The synthesis: group tasks by location. Having rejected both poles, the court adopted a middle rule with a concrete unit of analysis. “When evaluating whether the ‘nature of the work reasonably permits the use of seats,’ courts must examine subsets of an employee’s total tasks and duties by location, such as those performed at a cash register or a teller window, and consider whether it is feasible for an employee to perform each set of location-specific tasks while seated.” (Kilby, supra, 63 Cal.4th at p. 18.) Two evidentiary directives follow: courts “should look to the actual tasks performed, or reasonably expected to be performed, not to abstract characterizations, job titles, or descriptions that may or may not reflect the actual work performed,” and “[t]asks performed with more frequency or for a longer duration would be more germane to the seating inquiry than tasks performed briefly or infrequently.” (Ibid.) The payoff is stated plainly: “An employee may be entitled to a seat to perform tasks at a particular location even if his job duties include other standing tasks, so long as provision of a seat would not interfere with performance of standing tasks.” (Ibid.)

5. Sections 14(A) and 14(B) are complementary. The court corrected the district court’s premise directly. The two subdivisions are “not mutually exclusive in terms of the protections afforded to a particular employee,” and “[b]oth provisions may apply at various times during the workday, though not at the same time.” (Kilby, supra, 63 Cal.4th at pp. 18–19.) Section 14(B) governs “lulls in operation,” when an employee is on the job but not actively engaged in any duty. So “if an employee’s actual tasks at a discrete location make seated work feasible, he is entitled to a seat under section 14(A) while working there. However, if other job duties take him to a different location where he must perform standing tasks, he would be entitled to a seat under section 14(B) during ‘lulls in operation.’” (Id. at p. 19.) A single seat can serve both provisions, but only on conditions: although the two inquiries “are analytically different, the seat provided to an employee under section 14(A) may satisfy the requirement of section 14(B) to the extent it is within ‘reasonable proximity to the work area’ (§ 14(B)) and is available when work is not required to be performed.” (Ibid.)

6. “Reasonably permits” is qualitative, not arithmetic. Turning to the second question, the court set the frame before naming factors: “Whether an employee is entitled to a seat under section 14(A) depends on the totality of the circumstances.” (Kilby, supra, 63 Cal.4th at p. 19.) Analysis starts with tasks grouped by location, then is “balanced against considerations of feasibility,” which may include “whether providing a seat would unduly interfere with other standing tasks, whether the frequency of transition from sitting to standing may interfere with the work, or whether seated work would impact the quality and effectiveness of overall job performance.” (Id. at p. 20.) The court then foreclosed the reflexive defense move of counting minutes: “This inquiry is not a rigid quantitative analysis based merely upon the counting of tasks or amount of time spent performing them. Instead, it involves a qualitative assessment of all relevant factors.” (Ibid.) And no factor carries fixed weight: “The weight given to any relevant factor will depend upon the attendant circumstances.” (Id. at p. 21.)

7. Business judgment counts — but only the objective kind. The employers wanted deference to their judgment that standing employees deliver better customer service, or are perceived to. The court gave them part of it. “There is no question that an employer may define the duties to be performed by an employee,” and those duties are not limited to physical tasks: “Providing a certain level of customer service is an objective job duty that an employer may reasonably expect.” (Kilby, supra, 63 Cal.4th at p. 21.) Then came the limit that defines the doctrine: “However, ‘business judgment’ in this sense does not encompass an employer’s mere preference that particular tasks be performed while standing. The standard is an objective one.” (Ibid.) An objective inquiry credits the employer’s reasonable customer-service expectations, but “does not allow employers unlimited ability to arbitrarily define certain tasks as ‘standing’ ones, undermining the protective purpose of the wage order.” (Id. at p. 22.) Notably, the court did not adopt CVS’s proposed screen — CVS had urged that its business judgment “must be accorded deference” and that the relevant inquiry is whether the reasons for that judgment “are legitimate or pretextual.” (Id. at p. 21.) The court replaced that deference-plus-pretext test with objective reasonableness.

8. Physical layout is relevant — but cannot be gamed. Plaintiffs wanted layout excluded entirely. The court declined: “We conclude the physical layout of a workspace may be relevant in the totality of the circumstances inquiry,” because a workspace’s configuration “may inform the expectations of both the employer and employee with respect to job duties.” (Kilby, supra, 63 Cal.4th at p. 22.) The symmetry with business judgment is exact: “an employer may not unreasonably design a workspace to further a preference for standing or to deny a seat that might otherwise be reasonably suited for the contemplated tasks.” (Ibid.) Nor is layout a fixed given: “Evidence that seats are used to perform similar tasks under other, similar workspace conditions may be relevant to the inquiry, and to whether the physical layout may reasonably be changed to accommodate a seat.” (Ibid.)

9. Agency inaction proves nothing. The employers argued that decades of non-enforcement reflected an agency view that tellers and cashiers need no seats. The court rejected the inference, quoting Christopher v. SmithKline Beecham Corp. (2012) 567 U.S. 142, 157: “‘[A]n agency’s enforcement decisions are informed by a host of factors, some bearing no relation to the agency’s views regarding whether a violation has occurred.’” (Kilby, supra, 63 Cal.4th at p. 23.) It added a structural point. Quoting Arias, the court recalled that the Legislature enacted the Private Attorneys General Act on the declared premise that “staffing levels for labor law enforcement agencies had declined and were unlikely to keep pace with the future growth of the labor market,” and “that it was therefore in the public interest to allow aggrieved employees, acting as private attorneys general, to recover civil penalties for Labor Code violations …” (Ibid., quoting Arias v. Superior Court (2009) 46 Cal.4th 969, 980.) Non-enforcement is “at best, inconclusive.” (Ibid.)

10. The work, not the worker. CVS also argued that physical differences among employees matter. The court sided with plaintiffs on textual grounds: section 14(A) “requires a seat when the nature of the work reasonably permits it, not when the nature of the worker does.” (Kilby, supra, 63 Cal.4th at p. 23.) The historical focus “has been on the characteristics of the particular location and the duties associated with it.” (Ibid.) The court reserved, rather than resolved, the adjacent accommodation question. (Ibid.)

11. Burden: the employer must prove unavailability. Chase argued that a suitable seat is an “independent element” the plaintiff must prove. “The independent element argument fails.” (Kilby, supra, 63 Cal.4th at p. 24.) The text is unconditional — if the nature of the work reasonably permits seated work, employees “shall be provided with suitable seats” — and “[t]here is no language suggesting that an employee must additionally show a particular type of seat would fulfill that requirement.” (Ibid.) Accordingly, “[a]n employer seeking to be excused from the requirement bears the burden of showing compliance is infeasible because no suitable seating exists.” (Ibid.) There was no dissent and no separate concurrence.

Significance

Kilby took a provision that had been on the books in some form since 1911 and, for the first time, gave it an administrable structure. Before Kilby, federal district courts were split over whether section 14(A) reached actively working employees at all, and the “entire range of assigned duties” reading effectively immunized any job with a meaningful standing component — which is to say nearly every customer-facing job in the state.

Three features supply the decision’s practical force. First, the unit of analysis is the location, and the entitlement runs to “any employee while working there.” (Kilby, supra, 63 Cal.4th at p. 17.) That reorients the case away from an individualized inquiry into each plaintiff’s duty mix — the ground on which the Henderson class had been denied certification — and toward a common question about a workstation, far more amenable to classwide and representative treatment. Second, the objective standard strips employer preference of independent weight, changing what a summary-judgment record must contain: a declaration that the company wants its tellers standing is not evidence under this test. Third, placing the unavailability burden on the employer removes the plaintiff’s hardest proof problem, since the employer controls the information about what seating would fit the station.

The decision belongs to a line — Brinker, Mendiola, Martinez v. Combs — in which the court treats wage orders as statutes, construes them to protect employees, and consults but does not defer to DLSE views. Its PAGA passage is more than rhetorical: by holding that agency inaction proves nothing about the merits, the court removed the practical objection to private enforcement of a long-dormant regulation.

The limits deserve equal care. This is an answer to certified questions, not a merits ruling, and the court reserved application to these plaintiffs. The test is fact-intensive and qualitative, which cuts both ways at certification. And the court declined to say how the factors trade off, holding only that weight “will depend upon the attendant circumstances.” (Id. at p. 21.)

Key quotes

“The ‘nature of the work’ refers to an employee’s tasks performed at a given location for which a right to a suitable seat is claimed, rather than a ‘holistic’ consideration of the entire range of an employee’s duties anywhere on the jobsite during a complete shift.” (Kilby v. CVS Pharmacy, Inc. (2016) 63 Cal.4th 1, 8.)

“The inquiry does not turn on the individual assignments given to each employee, but on consideration of the overall job duties performed at the particular location by any employee while working there, and whether those tasks reasonably permit seated work.” (Id. at p. 17.)

“However, ‘business judgment’ in this sense does not encompass an employer’s mere preference that particular tasks be performed while standing. The standard is an objective one.” (Id. at p. 21.)

“An employer seeking to be excused from the requirement bears the burden of showing compliance is infeasible because no suitable seating exists.” (Id. at p. 24.)

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Practice pointer

Open questions

How the factors trade off. The court identified relevant considerations but refused to rank them, holding that “[t]he weight given to any relevant factor will depend upon the attendant circumstances.” (Kilby, supra, 63 Cal.4th at p. 21.) Nothing says how much a seat must “unduly interfere with other standing tasks,” or how frequent a sit-stand transition must be before it “may interfere with the work.” (Id. at p. 20.)

What counts as a “location.” The court gave examples — a cash register, a teller window (id. at p. 18) — but did not define the granularity of a “discrete location” (id. at pp. 19–20). Whether a sales floor or a multi-station service counter is one location or several is left to case-by-case litigation, and is often outcome-determinative.

Individualized accommodation. Having held that section 14(A) looks to the work and not the worker, the court reserved the adjacent question: this case “presents no issue regarding any accommodations that may be required for particular workers under other provisions.” (Id. at p. 23.) The interaction with FEHA’s accommodation duty remains undeveloped.

Suitability itself. The court held that the employer bears the burden of proving no suitable seat exists (id. at p. 24) but did not say what makes a seat “suitable,” nor what quantum of evidence discharges the burden.

Application to these plaintiffs. Because the court answered certified questions rather than deciding the appeals, it resolved neither Kilby’s entitlement to a seat nor whether the Henderson class could be certified under the standard it announced. (Id. at p. 24.)