Stanford Law School - Robert Crown Law Library

Filed 7/10/06

IN THE SUPREME COURT OF CALIFORNIA

AMANZA SMITH,
Petitioner,
S129476
v.
Ct.App. 2/5 B176918
THE SUPERIOR COURT OF
LOS ANGELES COUNTY,
Los Angeles County
Respondent;
Super. Ct. No. BC 284690
)
L’OREAL USA, INC.,
Real Party in Interest.

Section 201 of the Labor Code1 provides that if an employer “discharges”
an employee, wages earned and unpaid at the time of discharge are due and
payable immediately. Under section 203, an employer’s willful failure to pay
wages to a “discharged” employee in accordance with section 201 subjects the
employer to penalties.
The question presented is whether the discharge element of these two
statutes requires an involuntary termination from an ongoing employment
relationship, such as when an employer fires an employee, or whether this element
also may be met when an employer releases an employee after completion of the

1
Unless otherwise specified, all further statutory references are to this code.
1

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specific job assignment or time duration for which the employee was hired.
Application of settled statutory construction principles leads us to conclude the
statutory discharge element contemplates both types of employment terminations.
FACTUAL AND PROCEDURAL BACKGROUND
Plaintiff Amanza Smith was working as a salesperson in a Beverly Hills
boutique when a representative of defendant L’Oreal USA, Inc., approached her
and asked if she would like to be a “hair model” at an upcoming show featuring
L’Oreal products and a hair stylist. After plaintiff attended a modeling call,
defendant agreed to pay her $500 for one day’s work at the show.
At the show, plaintiff sat on a stage in front of an audience as her hair was
colored and styled. She then walked a runway a few times. Plaintiff stayed at the
show until she was told she could leave. Defendant did not immediately pay
plaintiff the $500 in wages it owed her, but waited over two months to do so.
Plaintiff filed the instant lawsuit against defendant on behalf of herself and
all other similarly situated models who worked for defendant. The complaint
contains causes of action for conversion, fraud and deceit, violation of Business
and Professions Code section 17200, violation of sections 201 and 203, breach of
contract, and negligent misrepresentation. The complaint also includes a cause of
action “on behalf of the public” for violation of Business and Professions Code
section 17200. As relevant here, plaintiff alleges defendant violated section 201
by failing to pay her and the other models their wages immediately upon discharge
from employment. Pursuant to section 203, she seeks penalties against defendant
in the amount of $15,000 for herself, representing 30 days of the applicable wage
rate ($500), and penalties for each similarly situated model according to proof.
Defendant moved for summary adjudication of all causes of action except
conversion and breach of contract. For purposes of its motion, defendant
conceded plaintiff was its employee and not an independent contractor, and it did
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not argue its wage payment timing was in accordance with the parties’ agreement.
Defendant, however, contended plaintiff could not recover penalties under section
203 because the job termination that occurred when she completed her one-day
work assignment did not constitute a “discharge” or “layoff” that triggered section
201’s requirement for immediate wage payment. The trial court agreed and
granted defendant’s motion. Plaintiff filed a petition for writ of mandate. The
Court of Appeal initially issued an order to show cause why the petition should not
be granted, then denied the petition in a published opinion.
We granted plaintiff’s petition for review.
DISCUSSION
The public policy in favor of full and prompt payment of an employee’s
earned wages is fundamental and well established: “ ‘Delay of payment or loss of
wages results in deprivation of the necessities of life, suffering inability to meet
just obligations to others, and, in many cases may make the wage-earner a charge
upon the public.’ ” (Kerr’s Catering Service v. Department of Industrial Relations
(1962) 57 Cal.2d 319, 326.) California has long regarded the timely payment of
employee wage claims as indispensable to the public welfare: “It has long been
recognized that wages are not ordinary debts, that they may be preferred over
other claims, and that, because of the economic position of the average worker
and, in particular, his dependence on wages for the necessities of life for himself
and his family, it is essential to the public welfare that he receive his pay when it is
due. [Citations.] An employer who knows that wages are due, has ability to pay
them, and still refuses to pay them, acts against good morals and fair dealing, and
necessarily intentionally does an act which prejudices the rights of his employee.”
(In re Trombley (1948) 31 Cal.2d 801, 809-810; see Gould v. Maryland Sound
Industries, Inc. (1995) 31 Cal.App.4th 1137, 1147 [statute criminalizing prompt
payment violations shows “the policy involves a broad public interest, not merely
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the interest of the employee”].) We recently identified sections 201 and 203 as
implementing this fundamental public policy regarding prompt wage payment.
(See Smith v. Rae-Venter Law Group (2002) 29 Cal.4th 345, 360.)
In the proceedings below, defendant conceded for purposes of summary
adjudication that it had an employer-employee relationship with plaintiff as
sections 201 and 203 require. The central dispute here is whether defendant
effectuated a “discharge” of plaintiff within the contemplation of these statutes.
Plaintiff contends that sections 201 and 203 protect employees such as herself who
are hired for a particular job assignment or time duration, and that the statutory
discharge element is met when the employment relationship is terminated upon
completion of the specified employment. Conversely, defendant, like the Court of
Appeal below, interprets the discharge element to mean an employer must
affirmatively dismiss an employee from an ongoing employment relationship, for
example, by firing or laying off the employee. The issue is one of statutory
construction that is subject to our independent review. (See Smith v. Rae-Venter
Law Group, supra, 29 Cal.4th at p. 357.)
In construing a statute, our fundamental task is to ascertain the
Legislature’s intent so as to effectuate the purpose of the statute. (Day v. City of
Fontana (2001) 25 Cal.4th 268, 272.) We begin with the language of the statute,
giving the words their usual and ordinary meaning. (Ibid.) The language must be
construed “in the context of the statute as a whole and the overall statutory
scheme, and we give ‘significance to every word, phrase, sentence, and part of an
act in pursuance of the legislative purpose.’ ” (People v. Canty (2004) 32 Cal.4th
1266, 1276.) In other words, “ ‘we do not construe statutes in isolation, but rather
read every statute “with reference to the entire scheme of law of which it is part so
that the whole may be harmonized and retain effectiveness.” [Citation.]’ ” (In re
Marriage of Harris (2004) 34 Cal.4th 210, 222.) If the statutory terms are
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ambiguous, we may examine extrinsic sources, including the ostensible objects to
be achieved and the legislative history. (Day, supra, 25 Cal.4th at p. 272.) In such
circumstances, we choose the construction that comports most closely with the
Legislature’s apparent intent, endeavoring to promote rather than defeat the
statute’s general purpose, and avoiding a construction that would lead to absurd
consequences. (Ibid.)
At issue here is the first sentence of section 201, subdivision (a): “If an
employer discharges an employee, the wages earned and unpaid at the time of
discharge are due and payable immediately.”2 Also relevant is the part of section
203 providing: “If an employer willfully fails to pay, without abatement or
reduction, in accordance with Sections 201, 201.5, 202, and 205.5, any wages of
an employee who is discharged or who quits, the wages of the employee shall
continue as a penalty from the due date thereof at the same rate until paid or until
an action therefor is commenced; but the wages shall not continue for more than
30 days. . . .” (§ 203, 1st par.)
Although each statute specifies its applicability when a “discharge” of an
employee occurs, neither statute provides a definition for that term. Nor is the

2
Section 201, subdivision (a), provides in full: “If an employer discharges
an employee, the wages earned and unpaid at the time of discharge are due and
payable immediately. An employer who lays off a group of employees by reason
of the termination of seasonal employment in the curing, canning, or drying of any
variety of perishable fruit, fish or vegetables, shall be deemed to have made
immediate payment when the wages of said employees are paid within a
reasonable time as necessary for computation and payment thereof; provided,
however, that the reasonable time shall not exceed 72 hours, and further provided
that payment shall be made by mail to any employee who so requests and
designates a mailing address therefor.”
The remainder of section 201 pertains to discharges in state employment.
(§ 201, subds. (b), (c).)
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term elsewhere defined in the Labor Code or in the regulations promulgated by the
Department of Industrial Relations, Division of Labor Standards Enforcement
(DLSE), the agency charged with interpreting and enforcing state wage and hour
laws. (§§ 79, 82, 90.5, 95, subd. (a).)
Relying in part on legal and nonlegal dictionaries to ascertain the most
commonly understood meaning of “discharge,” the Court of Appeal concluded the
term refers only to “the affirmative dismissal of an employee by an employer from
ongoing employment and does not include the completion of a set period of
employment or a specific task.” (Italics added.) We are not convinced.
While various dictionaries indicate a “discharge” often refers to an
employer’s dismissal of an employee from employment that otherwise would be
ongoing, e.g., a firing (e.g., Black’s Law Dict. (8th ed. 2004) p. 495; Merriam-
Webster’s Collegiate Dict. (11th ed. 2003) p. 356), these sources do not
categorically limit the term to that type of employment termination or separation.
Nor do they purport to define the term as excluding situations where employment
is terminated upon the completion of a specific job assignment or time duration.
Indeed, another commonly understood meaning of “discharge” includes the
action of an employer who, having hired an employee to work on a particular job
or for a specific term of service, formally releases the employee and ends the
employment relationship at the point the job or service term is deemed complete.
(E.g., Merriam-Webster’s Collegiate Dict., supra, at p. 356 [“discharge” may
mean “to release from an obligation” or “to release from service or duty <~ a
soldier>”]; Webster’s 3d New Internat. Dict. (2002) p. 644 [reflecting that one
meaning of “discharge,” in its verb form, is “to end formally the service of:
release from duty” and that one meaning of the noun “discharge” is “a release or
dismissal esp. from an office or employment <the ~ of a worker>”]; American
Heritage Dict. of the English Language (4th ed. 2000) p. 515 [defining
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“discharge” as including: “Dismissal or release from employment, service, care,
or confinement”].) In this regard, even though “discharge” includes the meaning
“to dismiss from employment” (e.g., Merriam-Webster’s Collegiate Dict., supra,
at p. 356), the word “dismiss,” in turn, is commonly understood to mean “to
permit or cause to leave” (e.g., id. at p. 360 [italics added]).
The very nature of an employer-employee relationship supports a more
inclusive construction, particularly as to cases where an employer hires an
employee for a specific job assignment, for generally it is up to the employer, not
the employee, to direct how the assignment is to be executed and to determine
when it has been completed. (See Zaremba v. Miller (1980) 113 Cal.App.3d
Supp. 1, 5 [“ ‘most important factor’ ” in determining whether one is an employee,
as opposed to an independent contractor falling outside the protective scope of
sections 201 and 203, is the right of the hirer to “ ‘control the manner and means
of accomplishing the result desired’ ”].) Consistent with the manner in which
assignment-based employer-employee relationships typically function, plaintiff
here stayed at the hair show until defendant told her she was free to leave and
thereby released her from any further hair modeling and show obligations. The
term “discharge,” then, reasonably may encompass either or both of the meanings
the parties have ascribed to it.
Mindful that statutory terms must not be viewed in isolation, we look to the
legislative scheme as a whole, including other related statutes and a provision
within section 201 itself, in order to glean the proper construction.
Sections 201 and 203 are part of article 1 (General Occupations) of chapter
1 (Payment of Wages) of part 1 (Compensation) of division 2 (Employment
Regulation and Supervision) of the Labor Code. Article 1 also includes section
202, which sets forth the wage payment rule for cases in which an employee
without a written contract for a definite period quits his or her employment.
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Under section 202, all earned and unpaid wages generally are due and payable
“not later than 72 hours” after the employee quits.3 Together, sections 201 and
202 direct employers to promptly pay wages when employment is terminated by
discharge, or by resignation if no requisite written contract exists, with section 203
providing for penalties when the employer willfully fails to do so.
Article 1 also contains provisions recognizing that, in certain industries,
extenuating circumstances may require additional time for calculating and
distributing earned wages when an employee is discharged or laid off. Section
201, for example, provides that an employer who “lays off a group of employees
by reason of the termination of seasonal employment in the curing, canning, or
drying of any variety of perishable fruit, fish or vegetables, shall be deemed to
have made immediate payment” by paying the wages within a reasonable time as
necessary to compute and pay such wages, in no event exceeding 72 hours.
(§ 201, subd. (a), italics added; see ante, fn. 2.)
Similarly, section 201.5 provides that, in the motion picture industry, when
the terms of employment are such as to require “special computation” to ascertain
the wages due, an employer “shall be deemed to have made immediate payment of
wages within the meaning of Section 201” in a “layoff” situation if it pays wages
by the next regular payday following the layoff, and in a “discharge” situation if it
pays wages within 24 hours after the discharge, excluding weekend days and

3
Section 202 provides in relevant part: “(a) If an employee not having a
written contract for a definite period quits his or her employment, his or her wages
shall become due and payable not later than 72 hours thereafter, unless the
employee has given 72 hours previous notice of his or her intention to quit, in
which case the employee is entitled to his or her wages at the time of quitting. . . .”
Following a pattern similar to section 201, section 202’s other subdivisions
relate to resignations in state employment. (§ 202, subds. (b), (c).)
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holidays. (§ 201.5, 1st par., italics added.) Section 201.5 explains that “special
provision” must be made for this industry because employees work at various
locations that often are far removed from the employer’s principal administrative
offices, “and the unusual hours of their employment in this industry is often
geared to the completion of a portion of a picture, which time of completion may
have no relation to normal working hours.” (§ 201.5, 2d par., italics added.)
Finally, section 201.7 provides that an employer in the oil drilling business
“shall be deemed to have made immediate payment within the meaning of Section
201” if it pays wages within a reasonable time as necessary not exceeding 24
hours after the discharge, excluding weekend days and holidays. (§ 201.7, 1st
par., italics added.) Like section 201.5, section 201.7 explains that “special
provision” must be made for oil drilling businesses because the various locations
of employment may make “the computation and payment of wages on an
immediate basis unduly burdensome.” (§ 201.7, 2d par.)
These exceptions to section 201’s immediate payment requirement,
especially section 201.5 and the exception within section 201 itself, strongly imply
the statutory discharge element is not limited to dismissals from ongoing
employment. Notably, these exceptions pertain to situations anticipating the
employees will complete the particular job assignment or period of service for
which they were hired—i.e., when a discharge or a layoff occurs “by reason of the
termination of seasonal employment” (§ 201, subd. (a)) or upon “completion of a
portion of a [motion] picture” (§ 201.5, 2d par.). Redefining what “immediate
payment” means, vis-à-vis section 201, and articulating justifications for an
extended payment period in the context of these selected industries, makes little
sense if section 201’s immediate payment requirement does not, in the first
instance, generally apply to employment terminations resulting from completion
of specified job assignments or periods of service.
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To confirm the proper interpretation of sections 201 and 203, we next
examine the ostensible objects to be achieved and the legislative history. We
observe the Legislature first enacted an immediate wage payment provision
similar to section 201 in 1911.4 At the time, the Bureau of Labor Statistics (BLS)
was the agency that recommended and enforced such wage-related legislation.
(See Stats. 1883, ch. XXI, pp. 27-30 [“An Act to establish and support a Bureau of
Labor Statistics”].) Legislation charged the BLS Commissioner with the duties to
“collect . . . and present, in biennial reports to the Legislature, statistical details,
relating to all departments of labor in the State,” including statistics and all other
information relating to labor that the commissioner deemed essential to further the
legislative objective, “together with such strictures on the condition of labor and
the probable future of the same” as the commissioner deemed “good and salutary
to insert in his biennial reports.” (Stats. 1883, ch. XXI, § 3, pp. 28-29.) We
therefore consult these biennial reports for whatever light they may shed regarding
the purpose of the wage payment legislation. (See People ex rel. Lungren v.

4
The first version of the statute that later became section 201 was enacted in
1911. (Stats. 1911, ch. 663, § 1, p. 1268.) After the 1911 act was found to violate
a state constitutional provision that prohibited imprisonment for debt in a civil
action, on mesne or final process, unless in cases of fraud (In re Crane (1914) 26
Cal.App. 22, 25-26 [under the act, mere violation of the immediate wage provision
was a misdemeanor]), the Legislature amended the act in 1915 to adopt a civil
penalty and to require willfulness and ability to pay as elements supporting a
criminal sanction. (Stats. 1915, ch. 143, § 1, p. 299.) The amended statute
survived constitutional challenge. (Moore v. Indian Springs etc. Min. Co. (1918)
37 Cal.App. 370, 372, 380-381 (Moore).) In 1919, the Legislature repealed the
existing law but adopted essentially the same provisions as part of “An act to
regulate the payment of wages or compensation for labor or service in private
employments . . . .” (Legis. Counsel’s Dig., Stats. 1919, ch. 202, p. 294.) Finally,
in 1937, when the Legislature established the Labor Code, the 1919 provision
requiring immediate payment upon discharge was adopted as section 201. (Stats.
1937, ch. 90, p. 197.)
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Superior Court (1996) 14 Cal.4th 294, 309 [although not necessarily controlling,
the contemporaneous administrative construction of a statute by those charged
with its enforcement and interpretation is entitled to great weight].)
In 1910, BLS published a biennial report that included a section on “Wage
Payments,” a subject the BLS Commissioner described as being “of paramount
importance” at that time. (BLS, 14th Biennial Rep.: 1909-1910 (1910) p. 12.) As
part of its report, BLS recommended: “A reasonable provision should be made for
the immediate payment following dismissal of an employee, or at the conclusion
of specified employment.” (Id. at p. 43, italics added.) In addressing the need for
this and other wage-related legislation, BLS emphasized the unrest, dissatisfaction,
and hardship caused by the circumstance that a number of employers were
requiring discharged employees to travel long distances to collect their wages, and
that in many instances, employers were failing to honor their wage obligations for
another 30 to 90 days. (Ibid.)5 This concern was relevant to both types of
discharged employees BLS referenced (those fired and those released after

5
BLS explained: “Instances are numerous of the manifest unfairness to
employees, which is practiced by some employers, in requiring that the wage
earner travel long distances in order to collect the amount due. In many of these
cases the employee finds, upon arrival at the point at which payment was
expected, that the demand will not be honored until after a lapse of a period of
from thirty to ninety days. . . . [¶] This condition tends to develop a spirit of unrest
and dissatisfaction, demanding immediate remedial legislation, which can not be
too strongly urged. The numerous cases that have come within the observation of
[BLS] show conclusively the hardship that has been worked upon employees,
especially the manual labor class, and this applies not only to men who have
become dissatisfied with the character and condition of the labor, but to men who
have been discharged for valid or invalid reasons. In numerous instances these
men have been absolutely refused adequate evidence of the wage earned and
due. . . . [¶] These complaints are not confined to any particular locality, but are
general throughout those portions of the State employing temporary labor,
particularly in construction work.” (BLS, 14th Biennial Rep., supra, at pp. 43-44.)
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conclusion of specified employment), for in either situation, traveling long
distances and waiting for the delayed payment of earned wages would frustrate the
employee’s ability to obtain and maintain other employment. In 1911, the
Legislature enacted the first law requiring prompt wage payment, utilizing the
term “discharges” and other wording nearly identical to that appearing in section
201 today.6
In 1923, BLS identified Moore, supra, 37 Cal.App. 370, as an important
court decision that warranted mention. (BLS, 20th Biennial Rep.: 1921-1922
(1923) p. 36.) While noting the only issue in the case was the constitutionality of
the 1911 immediate wage payment law as amended in 1915 with regard to the
criminal sanction (see ante, fn. 4), BLS found significant Moore’s conclusion in
dictum that laborers employed on a day-to-day basis were particularly in need of
these laws: “ ‘It is not to be expected that the laborer upon whose service these
industries depend will give his service without assurance of receiving the reward
promised for such service, and any law whose object is to give to the laborer some
further assurance that he will be promptly paid for his labor, in addition to his
employer’s promise, would seem to be reasonable, especially as the object is to
induce, if not to compel, the employer to keep faith with his employee, and
imposes a penalty only when he commits a wrong which not only injures the
employee but is an injury to the public in its tendency to deprive the public of an

6
The 1911 act stated in relevant part: “Whenever an employer discharges an
employee, the wages earned and unpaid at the time of such discharge shall become
due and payable immediately. When any such employee not having a contract for
a definite period quits or resigns his employment the wages earned and unpaid at
the time of such quitting or resignation shall become due and payable five days
thereafter.” (Stats. 1911, ch. 663, § 1, p. 1268.) As indicated, section 202 is the
provision that currently addresses prompt wage payment when an employee quits
or resigns.
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incidental benefit which comes from the employee’s labor. The law imposes no
unreasonable burden upon the employer, for, operating as it does in the future, and
disturbing no vested right, he must, and it is but fair he should, make provision to
pay his employee before hiring him, failing in which he should pay the penalty.
Many enterprises require the services of large numbers of men—the numbers
shifting from day to day—some being discharged and others taken on the job. It is
common knowledge that a refusal to pay discharged men under such
circumstances would tend to create breaches of the peace and disturb the public
tranquility. The intention of the penalty imposed by the act in question is to make
it to the interest of the employer to keep faith with his employees and thus avoid
injury to them and possible injury to the public at large.’ ” (20th Biennial Rep.,
supra, at p. 36, quoting Moore, supra, 37 Cal.App. at p. 380.) In quoting this
passage approvingly, BLS demonstrated its relatively contemporaneous
understanding that the 1915 wage payment legislation, consistent with the original
1911 legislation BLS had recommended, applied to day laborers whose
employment “discharge” at the end of the day would not necessarily result from a
“firing” or other involuntary termination. Just as significant, the passage
acknowledged the public policy reasons supporting an immediate wage payment
requirement, and those reasons appeared equally valid for both types of
employees.
Through its biennial reports, BLS consistently emphasized the success of,
and continued need for, wage payment legislation to protect working men and
women from exploitative employers and to alleviate the predicament of discharged
employees and quitting employees who were unable to promptly obtain the wages
they earned. (E.g., BLS, 16th Biennial Rep.: 1913-1914 (1914) p. 15; BLS, 15th
Biennial Rep.: 1911-1912 (1912) p. 9.) In reviewing the particular reports both
sides have identified as relevant, however, we find no instance in which BLS
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purported to distinguish between employees who were fired or otherwise
dismissed from ongoing employment and those who were released after
completing their agreed-upon job assignments or terms of service. Certainly
nothing in these reports indicated a recognition that the consequences of delayed
or withheld wages were dissimilar for these different categories of employees.
Nor was there any suggestion that fired employees were more economically or
socially vulnerable as a result of deferred wage payment, or otherwise more
deserving of immediate wage payment, than those employees who were not fired
but released when their work was deemed completed. To the contrary, the passage
BLS found significant within Moore, supra, 37 Cal.App. at page 380, reflects
there was no perception of such a distinction. Accordingly, it is not surprising, in
light of the important public policy at stake, that the Legislature, rather than
adopting a narrower construction of the statutory term “discharge” in response to
the more inclusive construction reflected in the BLS biennial reports, instead
undertook to enact only limited exceptions to the immediate payment requirement
in three specified industries. (See Stats. 1947, ch. 769, § 1 p. 1849 [amending
§ 201 to address group layoffs occurring “by reason of the termination of seasonal
employment”]; Stats. 1957, ch. 1118, § 1, p. 2419 [adding § 201.5]; Stats. 1980,
ch. 440, § 1, p. 925 [adding § 201.7].)
In light of the above, construing the immediate payment requirement as
applying to both types of discharges appears to (1) be consistent with the statutory
language and history; (2) better reflect the understanding of the agency originally
charged with recommending enactment of such remedial legislation and with its
enforcement;7 and (3) more broadly advance the purpose of the legislation to

7
In 1976, DLSE ultimately succeeded to the duties, powers, purposes,
responsibilities that originally resided with the BLS Commissioner, including the

(footnote continued on next page)
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ensure that discharged employees do not suffer deprivation of the necessities of
life or become charges upon the public. Accordingly, we conclude an employer
effectuates a discharge within the contemplation of sections 201 and 203, not only
when it fires an employee, but also when it releases an employee upon the
employee’s completion of the particular job assignment or time duration for which
he or she was hired.
In construing the statutory discharge element to require the firing or layoff
of an employee from ongoing employment, the Court of Appeal relied in part on
Romano v. Rockwell Internat., Inc. (1996) 14 Cal.4th 479, in which we stated: “In
the employment law context, the usual and ordinary meaning of the term
‘discharge’ is to terminate employment.” (Id. at p. 493.) Romano, however,
examined the discharge issue in the context of determining when the statute of
limitations begins to run in a wrongful termination case brought under the Fair
Employment and Housing Act (Gov. Code, § 12900 et seq.). Because Romano did
not involve a wage-related claim and did not purport to equate a discharge with a
firing for all purposes, it bears little relevance here. (See also Stephens v. County

(footnote continued from previous page)

power to interpret and enforce state wage and hour laws. (Stats. 1976, ch. 746,
§ 16, p. 1777, adding § 82; see also Stats. 1976, ch. 746, §§ 12, 13, p. 1777,
repealing and reenacting § 79; §§ 90.5, 95, subd. (a).) In a letter to this court, the
Assistant Chief Counsel to the Labor Commissioner (the chief of DLSE)
represents that the “Labor Commissioner has uniformly held, where appropriate,
that an employee who is let go by the employer, whether fired, laid off for an
indefinite term, or because the job was for a fixed period of time and ended, must
be paid in accordance with section 201, at the time of ‘discharge.’ ” Although
defendant appears to dispute this representation, it fails to cite any material
reflecting a contrary position taken by the Labor Commissioner.
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of Tulare (2006) 38 Cal.4th 793[construing meaning of phrase “dismissed . . . for
disability” contained in Government Code section 31725].)
Given the lack of relevant California precedent,8 the Court of Appeal also
relied on several Arkansas and Louisiana authorities to bolster its construction of
sections 201 and 203. (See, e.g., Missouri Pacific R. Co. v. Clement (Ark. 1944)
181 S.W.2d 240, 242; Chicago, R.I. & P. Ry. Co. v. Russell (Ark. 1927) 292 S.W.
375, 376; Smith v. Dishman & Bennett Specialty Co. (La.Ct.App. 2002) 805 So.2d
1220; Franklin v. Ram, Inc. (La.Ct.App. 1991) 576 So.2d 546; Collins v. Joseph
(La.Ct.App. 1971) 250 So.2d 796.) That reliance was misplaced. While those
authorities may stand for the proposition that a “discharge” under Louisiana and
Arkansas law excludes termination of a limited employment, they are
unpersuasive here in light of the entire California statutory scheme and its
legislative history.
We next address a contention made by New Avalon, Inc. (New Avalon),
appearing as amicus curiae in support of defendant. New Avalon generally agrees
that BLS’s biennial reports are properly considered as part of the relevant

8
Courts in two cases permitted recovery of section 203 penalties where
employees had been hired for a specific project. (Road Sprinkler Fitters Local
Union No. 669 v. G & G Fire Sprinklers, Inc. (2002) 102 Cal.App.4th 765, 779-
780 [union, under an assignment of rights, could collect penalties where employer
failed to pay all wages due to workers upon their termination from employment];
Zaremba v. Miller, supra, 113 Cal.App.3d at p. Supp. 5 [model employed for a
two-hour assignment was an “employee” and therefore eligible for penalties].)
Neither case, however, involved a dispute regarding the discharge element of
section 201. Another decision suggested that sections 201 and 203 “refer by their
terms to a situation where an individual workman is . . . ‘fired,’ ” and not where
seasonal work being done by an entire crew is terminated, but did so in the context
of addressing a sufficiency-of-the-evidence claim regarding the nature of an
employee’s death. (Argonaut Ins. Co. v. Industrial Acc. Com. (1963) 221
Cal.App.2d 140, 145.)
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legislative history. However, based on one such report (see BLS, 19th Biennial
Rep.: 1919-1920 (1920) p. 38), New Avalon argues that certain legislation
enacted in 1913 to regulate the wage payment of seasonal Alaska cannery workers
would have been superfluous if the discharge language in the 1911 act covered
seasonal employees whose employment terminations were not involuntary. We
disagree.
The BLS biennial reports reflect the 1913 legislation was enacted to
address the serious problem that large numbers of cannery workers were returning
from Alaska to San Francisco at the end of the salmon season with little or no
money due them after a season’s work, primarily because significant deductions
were taken out of their wages for gambling debts, liquor, and food.9 (BLS, 15th
Biennial Rep., supra, at pp. 51-52.) To address these workers’ claims of “false or
exorbitant deductions on their wages” (id. at p. 52), the 1913 legislation authorized
the BLS Commissioner to hear and decide all seasonal labor wage disputes and to
require the commissioner to “allow or reject any deductions made from such
wages; provided, however, that he shall reject all deductions made for gambling
debts incurred by the employee during such employment and for liquor sold to the

9
BLS described how men employed in the Alaska salmon canneries were
hired and paid: “These men are hired in San Francisco during the months of
March and April and are shipped north to work in the salmon canneries, located on
the coast of Alaska. They are returned during the months of August and
September and are paid off in San Francisco for the full season’s work. At the
time these men are paid off the real trouble begins. Innumerable disputes arise on
account of the deductions that are made for various items—principally for
gambling debts, liquor and food.” (BLS, 15th Biennial Rep., supra, at p. 51,
italics added.) BLS referred to the situation as “a grave one, for it must be borne
in mind that, when you cast several thousand irresponsible men who are
penniless—or almost penniless—adrift in [San Francisco], after they have toiled
for five or six months—you add a large factor to the criminal element of the
community.” (Id. at p. 52.)
17

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employee during such employment.” (Stats. 1913, ch. 198, § 3, p. 343.) If
anything, the operative terms and legislative history of the 1913 legislation
together suggest that while the cannery workers were being paid promptly at the
end of their seasonal employment in conformity with the 1911 act, the 1913 law
was necessary to address the special problem that exorbitant deductions for
gambling debts and liquor were diminishing these workers’ wages. (See BLS,
15th Biennial Rep., supra, at p. 52 [“[w]hile [BLS] has been successful in getting
redress in many cases, still our laws at present are inadequate to cover the
situation” (italics added)].)
Finally, defendant relies on Hale v. Morgan (1978) 22 Cal.3d 388 (Hale)
and other authorities in asserting that penalties are never favored by courts of law
or equity and that statutes imposing penalties or creating forfeitures must be
strictly construed. (Hale, at p. 401; see also No Oil, Inc. v. Occidental Petroleum
Corp. (1975) 50 Cal.App.3d 8, 29.)
These authorities and principles do not aid defendant’s position. The rule
of strict construction of penal statutes “has generally been applied in this state to
criminal statutes, rather than statutes which prescribe only civil monetary
penalties.” (People ex rel. Lungren v. Superior Court, supra, 14 Cal.4th at p.
312.) Moreover, Hale, supra, 22 Cal.3d 388, “did not purport to alter the general
rule that civil statutes for the protection of the public are, generally, broadly
construed in favor of that protective purpose.” (People ex rel. Lungren v. Superior
Court, supra, 14 Cal.4th at p. 313.)
In any event, even if there are circumstances in which civil statutes should
be strictly construed, there is very little here to support defendant’s proffered
construction. The plain purpose of sections 201 and 203 is to compel the
immediate payment of earned wages upon a discharge. As discussed, a discharge
is commonly understood as referring both to an involuntary termination from an
18

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ongoing employment relationship and to a release of an employee after completion
of a specified job assignment or duration of time. The statutory scheme as a
whole, as well as the relevant legislative history, evince the Legislature’s intent to
require immediate wage payment in both types of discharge situations. Released
employees generally appear no less deserving or less in need of immediate wage
payment than those who are fired, and as BLS recognized in its biennial report:
“ ‘The law imposes no unreasonable burden upon the employer,’ ” and “ ‘it is but
fair that [the employer] should[] make provision to pay his employee before hiring
him, failing in which he should pay the penalty.’ ” (BLS, 20th Biennial Rep.,
supra, at p. 36, quoting Moore, supra, 37 Cal.App. at p. 380.) Under these
circumstances, it would be inappropriate to construe these statutes as excluding an
entire category of discharged employees from the protections afforded. (Cf.
Oppenheimer v. Sunkist Growers (1957) 153 Cal.App.2d Supp. 897, Supp. 899
[construing section 203 as not providing for continued penalty wages after earned
wages have been paid].)10

10
Defendant makes one additional statutory point. In a different division of
the Labor Code dealing with employment relations (division 3), section 2920
provides: “Every employment is terminated by any of the following: [¶] (a)
Expiration of its appointed term. [¶] (b) Extinction of its subject. [¶] (c) Death of
the employee. [¶] (d) The employee’s legal incapacity to act as such.” Citing this
section, defendant suggests the Legislature was demonstrably aware that
employment may end through means other than a discharge or a quitting, but made
no attempt to refer to these situations in enacting sections 201 through 203. But
section 2920 simply addresses the circumstances under which an employment
relationship is validly terminated. It does not address the matter of employee
wages; nor does it purport to create exceptions to the wage payment requirements
set forth in sections 201, 202, and 203.
19

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CONCLUSION AND DISPOSITION
Excluding employees like plaintiff from the protective scope of sections
201 and 203 would mean that employees who fulfill their employment obligations
by completing the specific assignment or duration of time for which they were
hired would be exposed to economic vulnerability from delayed wage payment,
while at the same time employees who are fired for good cause would be entitled
to immediate payment of their earned wages (§ 201) and many employees who
quit without fulfilling their employment obligations would have a right to wage
payment no later than 72 hours after they quit (§ 202).
While we are not prepared to say the Legislature could not validly adopt a
statutory scheme that operated in this fashion, our review of the relevant statutory
language and the overall statutory scheme, the legislative history, and the intended
purpose of the immediate wage payment legislation to address the economic
vulnerability of discharged employees and potential harm to the public, leads us to
conclude the discharge element of sections 201 and 203 may be satisfied either
when an employee is involuntarily terminated from an ongoing employment
relationship or when an employee is released after completing the specific job
assignment or time duration for which the employee was hired.11

11
Although we conclude defendant effectuated a discharge within the
contemplation of the statutory scheme, we express no opinion on the issue whether
defendant “willfully” failed to pay wages in accordance with section 201, so as to
warrant the penalty amounts plaintiff seeks pursuant to section 203.
20

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The judgment of the Court of Appeal is reversed, and the matter is
remanded to that court for further proceedings consistent with the views herein.

BAXTER, J.
WE CONCUR:

GEORGE, C.J.
KENNARD, J.
WERDEGAR, J.
CHIN, J.
MORENO, J.
CORRIGAN, J.

21

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See last page for addresses and telephone numbers for counsel who argued in Supreme Court.

Name of Opinion Smith v. Superior Court
__________________________________________________________________________________

Unpublished Opinion

Original Appeal
Original Proceeding
Review Granted XXX 123 Cal.App.4th 128
Rehearing Granted
__________________________________________________________________________________

Opinion No.

S129476
Date Filed: July 10, 2006
__________________________________________________________________________________

Court:

Superior
County: Los Angeles
Judge: Frances Rothschild
__________________________________________________________________________________

Attorneys for Appellant:

Glancy, Binkow & Goldberg, Lionel Z. Glancy, Kevin F. Ruf and Avi Wagner for Petitioner.

Rukin Hyland Doria & DuFrane and Peter Rukin for California Employment Lawyers Association as
Amicus Curiae on behalf of Petitioner.

Ivey, Smith & Ramirez, Jean-Claude André; Becky Lyn Monroe and Kevin Richard Kish for Bet Tzedek
Legal Services, Asian Pacific American Legal Center of Southern California, Korean Immigrant Workers
Advocates, La Raza Centro Legal and Stanford Community Law Clinic as Amici Curiae on behalf of
Petitioner.

Steven S. Elster for Clergy and Laity United for Economic Justice as Amicus Curiae on behalf of
Petitioner.

H. Thomas Cadell, Jr., as Amicus Curiae on behalf of Petitioner.

Cynthia L. Rice and Julia Montgomery for California Rural Legal Assistance Foundation, Maintenance
Cooperative Trust Fund, Legal Aid Society of Los Angeles, Legal Aid Society-Employment Law Center
and Asian Law Caucus, Inc., as Amici Curiae on behalf of Petitioner.
__________________________________________________________________________________

Attorneys for Respondent:

No appearance for Respondent.

__________________________________________________________________________________

Attorneys for Real Party in Interest:

Morgenstein & Jubelirer, William J. Carroll, Bruce A. Wagman and Bita A. Karabian for Real Party in
Interest.

Sefarth Shaw, Kenneth D. Sulzer and Thomas R. Kaufman for American Staffing Association as Amicus
Curiae on behalf of Real Party in Interest.

---

Page 2 – S129476 – counsel continued

Attorneys for Real Party in Interest (cont’d):

Mitchell Silberberg & Knupp and Lawrence A. Michaels for The Employers Group as Amicus Curiae on
behalf of Real Party in Interest.

Akin Gump Strauss Hauer & Feld, Rex S. Henke and Jessica M. Weisel for New Avalon, Inc., as Amicus
Curiae on behalf of Real Party in Interest.

---

Counsel who argued in Supreme Court (not intended for publication with opinion):

Kevin F. Ruf
Glancy, Binkow & Goldberg
1801 Avenue of the Stars, Suite 311
Los Angeles, CA 90067
(310) 201-9150

William J. Carroll
Morgenstein & Jubelirer
One Market, Spear Street Tower, 32nd Floor
San Francisco, CA 94105
(415) 901-8700

---

Opinion Information

Date:	Docket Number:
Mon, 07/10/2006	S129476

Disposition
Jul 10 2006	Opinion: Reversed

Dockets
Nov 24 2004	Petition for review filed   petitioner Amanza Smith
Nov 29 2004	Received Court of Appeal record
Dec 14 2004	Answer to petition for review filed   by counsel for real party in interest (L'Oreal USA, Inc.).
Dec 16 2004	Request for depublication (petition for review pending)   by (non-party) The Labor Comissioner.
Dec 20 2004	Request for depublication filed (another request pending)   on behalf of BET TZEDEK LEGAL SERVICES, et al. (non-party)
Jan 19 2005	Petition for review granted (civil case)   Votes: George, C.J., Kennard, Baxter, Werdegar, Chin, Brown and Moreno, JJ.
Jan 19 2005	Letter sent to:   counsel regarding Certification of Interested Entities or Persons w/form & copy of order.
Jan 25 2005	Certification of interested entities or persons filed   by counsel for petitioner.
Feb 3 2005	Certification of interested entities or persons filed   By counsel for RPI.
Feb 22 2005	Opening brief on the merits filed   petitioner Amanza Smith [rulel 40.1]
Mar 11 2005	Request for extension of time filed   RPI requesting to May 5, 2005 to file answer brief on the merits.
Mar 21 2005	Extension of time granted   to and including May 5, 2005 for real party in interest to file answer brief on the merits. No further extensions of time are contemplated.
May 5 2005	Answer brief on the merits filed   by RPI {L'Oreal USA, Inc.}.
May 20 2005	Request for extension of time filed   reply brief/merits to 6-25-05
May 23 2005	Extension of time granted   to and including June 27, 2005 for petitioner to file the reply brief on the merits.
Jun 28 2005	Reply brief filed (case fully briefed)   petitioner Amanza Smith [rule 40.1]
Jul 5 2005	Received application to file Amicus Curiae Brief   American Staffing Association [in support of real party]
Jul 12 2005	Permission to file amicus curiae brief granted   American Staffing Association
Jul 12 2005	Amicus curiae brief filed   by American Staffing Association in support of Real Party in Interest. Answer due by any party within 20 days.
Jul 27 2005	Received application to file Amicus Curiae Brief   by counsel for New Avalon, Inc. in support of real party in interest
Jul 28 2005	Request for extension of time filed   by attorney O'Malley for amici curiae Steele North America, Inc. in support of real party in interest, L'Oreal USA, Inc.
Jul 28 2005	Filed:   Declaration in support of request for extension of time to file application for leave to file an amicus curiae brief from counsel for Amici curiae L'Oreal USA, Inc.
Jul 28 2005	Received application to file Amicus Curiae Brief   by The Employers Group in support of real party in interest
Jul 28 2005	Received application to file Amicus Curiae Brief   and separate brief of H. Thos. Cadell [in support of petitioner]
Jul 28 2005	Received application to file Amicus Curiae Brief   within brief of Clery and Laity United for Economic Justice [in support of petitioner]
Jul 28 2005	Received application to file Amicus Curiae Brief   by California Employment Lawyers Association in support of petitioner.
Jul 29 2005	Request for extension of time filed   to file consolidated answer to ac briefs to 9-14-05>>petitioner Amanza Smith
Jul 29 2005	Received application to file Amicus Curiae Brief   California Rural Legal Assistance Foundation, The Maintenance Coopertaive Trust Fund, Legal Aid Foundation of Los Angeles, Legal Aid Society-Employment Law Center and The Asian Law Caucus in support of petitioner. / CRC 40.1(b). >> also recv'd Request for Judicial Notice.
Jul 29 2005	Permission to file amicus curiae brief granted   The Employers Group in support of RPI.
Jul 29 2005	Amicus curiae brief filed   The Employers Group in support of RPI. Answer is due within twenty days.
Jul 29 2005	Permission to file amicus curiae brief granted   New Avalon, Inc., in support of RPI.
Jul 29 2005	Amicus curiae brief filed   New Avalon, Inc., in support of RPI Answer is due within twenty days.
Aug 1 2005	Permission to file amicus curiae brief granted   California Employment Lawyers Association in support of Petitioner.
Aug 1 2005	Amicus curiae brief filed   California Employment Lawyers Assoc. in support of petitioner Answer is due within twenty days.
Aug 1 2005	Request for judicial notice filed (granted case)   with permission. California Employment Lawyers Association.
Aug 1 2005	Received application to file Amicus Curiae Brief   Bet Tzedek Legal Services, the Asian Pacific American Legal Center of Southern California, Korean Immigrant Workers Advocates, La Raza Centro Legal, and the Stanford Community Law Clinic in support of Petitioner. 40.1(b)
Aug 1 2005	Extension of time granted   On application of amicus curiae Steele North America, Inc. and good cause appearing, it is ordered that the time to serve and file the amicus application and proposed amicus curiae brief in support of real party in interest herein is extended to and including August 12, 2005.
Aug 2 2005	Permission to file amicus curiae brief granted   Clergy and Laity United for Economic Justice in support of petitioner.
Aug 2 2005	Amicus curiae brief filed   Clergy and Laity United for Economic Justice in support of petitioner. Answer is due within twenty days.
Aug 2 2005	Permission to file amicus curiae brief granted   Bet Tzedek Legal Services et al., in support of petitioner. 40.1(b)
Aug 2 2005	Amicus curiae brief filed   Bet Tzedek Legal Services et al., in support of petitioner. 40.1(b) Answer is due within twenty days.
Aug 2 2005	Extension of time granted   for petitioner to serve and file the answer to amicus curiae briefs to and including September 14, 2005.
Aug 3 2005	Permission to file amicus curiae brief granted   H. Thomas Cadell, Jr.
Aug 3 2005	Amicus curiae brief filed   H. Thomas Cadell, Jr. in support of petitioner is hereby granted. Answer due by any party within 20 days.
Aug 4 2005	Permission to file amicus curiae brief granted   California Rural Legal Assistance Foundation, The Maintenance Cooperative Trust Fund, Legal Aid Foundation of Los Angeles, Legal Aid Society-Employment Law Center and The Asian Law Caucus.
Aug 4 2005	Amicus curiae brief filed   California Rural Legal Assistance Foundation, The Maintenance Cooperative Trust Fund, Legal Aid Foundation of Los Angeles, Legal Aid Society-Employment Law Center and The Asian Law Caucus in support of petitioner. Answer due within 20 days.
Aug 4 2005	Request for judicial notice filed (granted case)   by counsel for Amici Curiae - California Rural Legal Assistance Foundation, The Maintenance Cooperative Trust Fund, Legal Aid Foundation of Los Angeles, Legal Aid Society-Employment Law Center and The Asian Law Caucus.
Aug 10 2005	Request for extension of time filed   RPI requesting to Sept. 30, 2005 to file a consolidated answer to multiple amicus curiae briefs.
Aug 12 2005	Extension of time granted   to and including September 30, 2005 for real party in interest to file a consolidated answer to amicus curiae briefs in support of petitioner.
Aug 23 2005	Request for extension of time filed   to file consolidated answer to ac briefs to 9-30-05 >>petitioner Amanza Smith
Aug 25 2005	Extension of time granted   to and including Sept. 30, 2005 for petitioner to file a consolidated answer to multiple amicus curiae briefs.
Sep 30 2005	Response to amicus curiae brief filed   By counsel for L'Oreal USA, Inc. (consolidated answer to amicus curiae briefs)
Oct 3 2005	Response to amicus curiae brief filed   consolidated answer>>petitioner Amanza Smith [rule 40.1]
Dec 21 2005	Association of attorneys filed for:   petitioner Amanza Smith Attorney Steven S. Elster, Retained
May 2 2006	Case ordered on calendar   May 30, 2006, at 1:00 p.m., in San Francisco
May 15 2006	Note: Mail returned and re-sent   Notice to amicus curiae H. thomas Cadll, Jr. returned as undeliverable and unable to forward: 120 Muit Court, Petlauma, CA 94954. Remailed to address at State Bar website: 10 Ford Street, #101, Geneva, IL 60134. Case party tab modified to show this new address.
May 19 2006	Request for judicial notice granted   Amicus curiae California Employment Lawyer's Association - filed August 1, 2005 Amicus curiae California Rural Legal Assistnce Foundation - filed August 4, 2005
May 30 2006	Cause argued and submitted
Jul 10 2006	Opinion filed: Judgment reversed   the matter is remanded to the court of appeal for further proceedings consistent with the views herein. Majority Opinion by Baxter, J. joined by George, C.J., Kennard, Chin, Werdegar, Moreno, and Corrigan, J.
Aug 3 2006	Motion filed (non-AA)   to modify opinion by AC American Staffing Association Attorney Thomas R. Kaufman
Aug 7 2006	Time extended to consider modification or rehearing   Finality of the opinion in the above-entitled case is hereby extended to and including September 8, 2006.
Aug 16 2006	Request for modification denied
Aug 16 2006	Remittitur issued (civil case)
Aug 23 2006	Received:   receipt for remittitur CA 2/5.

Briefs
Feb 22 2005	Opening brief on the merits filed
May 5 2005	Answer brief on the merits filed
Jun 28 2005	Reply brief filed (case fully briefed)
Jul 12 2005	Amicus curiae brief filed
Jul 29 2005	Amicus curiae brief filed
Jul 29 2005	Amicus curiae brief filed
Aug 1 2005	Amicus curiae brief filed
Aug 2 2005	Amicus curiae brief filed
Aug 2 2005	Amicus curiae brief filed
Aug 3 2005	Amicus curiae brief filed
Aug 4 2005	Amicus curiae brief filed
Sep 30 2005	Response to amicus curiae brief filed
Oct 3 2005	Response to amicus curiae brief filed

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