Petition for Writ of Certiorari — Los Angeles County Department of Public Social Services, Petitioner v. Trina Ray, et al.

i

APPENDIX TABLE OF CONTENTS

Page

United States Court of Appeals for the Ninth

Circuit, Opinion, November 4, 2022 ................ App. 1

United States District Court for the Central District of California, Order, October 27, 2020 .... App. 33

United States Court of Appeals for the Ninth

Circuit, Order, October 8, 2019 ...................... App. 59

United States Court of Appeals for the Ninth

Circuit, Opinion, August 22, 2019 ................. App. 62

United States District Court for the Central

District of California, Order, September 28,

2017 ................................................................ App. 91

United States Court of Appeals for the Ninth

Circuit, Order (denying rehearing), December

20, 2022 ........................................................ App. 117

Statutory Provisions ........................................ App. 119

App. 1

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

TRINA RAY; SASHA WALKER,

individually, and on behalf of

all others similarly situated,

Plaintiffs-Appellants,

v.

No. 20-56245

D.C. No.

2:17-cv-04239-PA-SK

OPINION

(Filed Nov. 4, 2022)

LOS ANGELES COUNTY

DEPARTMENT OF PUBLIC

SOCIAL SERVICES,

Defendant-Appellee,

and

CALIFORNIA DEPARTMENT

OF SOCIAL SERVICES,

Defendant.

Appeal from the United States District Court

for the Central District of California

Percy Anderson, District Judge, Presiding

Argued and Submitted November 18, 2021

Pasadena, California

App. 2

Before: Marsha S. Berzon and Johnnie B. Rawlinson,

Circuit Judges, and Matthew F. Kennelly,* District

Judge.

Per Curiam Opinion;

Partial Concurrence and

Partial Dissent by Judge Berzon

COUNSEL

Matthew C. Helland (argued) and Daniel S. Brome,

Nichols Kaster LLP, San Francisco, California; Philip

Bohrer, Bohrer Brady LLC, Baton Rouge, Louisiana;

for Plaintiffs-Appellants.

Jennifer M. Hashmall (argued), Jason H. Tokoro, Jeffery B. White, and Emily A. Rodriguez-Sanchirico, Miller Barondess LLP, Los Angeles, California; Lester J.

Tolnai, Office of the County Counsel, Los Angeles, California; for Defendant-Appellee.

Jennifer Bacon Henning, California State Association

of Counties, Sacramento, California, for Amicus Curiae

California State Association of Counties.

Per Curiam

The State of California and the County of Los

Angeles administer an In-Home Supportive Services

* The Honorable Matthew F. Kennelly, United States District Judge for the Northern District of Illinois, sitting by designation.

App. 3

program (“IHSS program”), which allows low-income

elderly, blind, or disabled residents of the County to

hire a provider to help them with daily living activities.

In 2013, the U.S. Department of Labor (“DOL”) issued

a new rule entitling IHSS providers and other homecare workers to overtime pay under the Fair Labor

Standards Act (“FLSA”). 78 Fed. Reg. 60,454 (Oct. 1,

2013) (codified at 29 C.F.R. pt. 552). A district court

vacated the rule before January 1, 2015, the rule’s

scheduled effective date. Home Care Ass’n of Am. v.

Weil (“Weil”), 76 F. Supp. 3d 138, 148 (D.D.C. 2014). The

D.C. Circuit reversed, upholding the rule in a decision

that mandated on October 13, 2015. Home Care Ass’n

of Am. v. Weil (“Weil II”), 799 F.3d 1084, 1087 (D.C. Cir.

2015). The State began paying overtime wages to IHSS

providers on February 1, 2016.

In June 2017, Trina Ray, an IHSS provider in Los

Angeles County, filed a putative collective action

against the County seeking relief for unpaid overtime

wages for the period between January 1, 2015, and

February 1, 2016.1 This is our second published opinion

in this case. Our previous opinion, Ray v. County of

Los Angeles (“Ray I”), 935 F.3d 703 (9th Cir. 2019),

held, first, that the County was not an “arm of the

state” with respect to the implementation of the IHSS

program and therefore was not entitled to Eleventh

Amendment immunity from suit, and, second, that the

1

Ray initially named California as a defendant but later voluntarily dismissed the State. Ray filed an amended complaint

adding a second named plaintiff, Sasha Walker. We refer to the

plaintiffs collectively as “Ray.”

App. 4

effect of Weil II was to reinstate the overtime rule’s

original effective date of January 1, 2015. Id. at 705,

713–14.

Three summary judgment rulings by the district

court are at issue in this appeal: The court granted

summary judgment to the County on the ground that

the County does not employ IHSS providers for purposes of the FLSA, granted partial summary judgment to the County on the issue of willfulness, and

denied partial summary judgment to Ray on the issue

of liquidated damages. We unanimously hold that the

County is a joint employer of IHSS providers under the

FLSA, and we reverse the district court’s ruling to the

contrary. In this per curiam opinion, Judges Rawlinson

and Kennelly also affirm the district court’s rulings on

willfullness and liquidated damages. Judge Berzon

dissents with regard to those rulings.

I.

A.

California’s IHSS program “serves hundreds of

thousands of recipients.” Ray I, 935 F.3d at 705. Providers help qualified individuals in their homes with

“daily activities like housework, meal preparation, and

personal care.” Id. “California implements the program through regulations promulgated by the California Department of Social Services (CDSS), and the

program is administered in part by California counties.” Id. The federal government, the State, and the

counties all contribute funding to the program.

App. 5

“In the County of Los Angeles alone there are

about 170,000 homecare providers and more than

200,000 recipients.” Id. County residents seeking IHSS

services apply through the County. County social workers review applications and conduct in-home visits to

assess recipients’ needs. Social workers determine the

services recipients are entitled to receive, the time allotted for each service, and the total number of hours a

provider may work for the recipient each month.

“Recipients . . . retain the right to hire, fire, and

supervise the work of any in-home supportive services

personnel providing services for them.” Cal. Welf. &

Inst. Code § 12301.6(c)(2)(B). Prospective providers

must attend an in-person orientation in a County field

office, where they view state-provided training materials and sign state-issued forms. Cal. Welf. & Inst. Code

§ 12301.24.

The County has established a public authority, the

Personal Assistance Services Council, that serves as

providers’ employer of record for collective bargaining

purposes. The Personal Assistance Services Council

maintains a registry of providers, coordinates provider

background checks, and provides training for providers

and recipients.

Recipients are responsible for setting their provider’s work schedule. See id. § 12300.4(d)(1)(A). Recipients also review and approve their provider’s timesheets.

App. 6

Providers submit their timesheets directly to the State,

which issues their paychecks.2

B.

As mentioned, DOL issued a new rule in 2013 entitling IHSS providers to overtime pay under the

FLSA. 78 Fed. Reg. 60,454. “Before the Weil I decision,

California (through the CDSS) began taking steps to

meet the January 1, 2015, implementation date, including modifying its systems to process and calculate

overtime compensation.” Ray I, 935 F.3d at 707 (internal quotation marks omitted). The County participated

in state-organized meetings and trainings on the new

overtime rule beginning in 2014.

After Weil I vacated the new rule, “the CDSS decided that it would not implement overtime payments

‘until further notice.’ ” Id. Once Weil II upheld the rule,

DOL announced that it would “not bring enforcement

actions against any employer for violations of FLSA

obligations resulting from the amended domestic service regulations for 30 days after the date the mandate

[in Weil II] issues,” 80 Fed. Reg. 55,029, 55,029 (Sept.

14, 2015), which occurred on October 13, 2015. DOL

later confirmed that it would not begin enforcing the

rule until November 12, 2015, and also stated that

through December 31, 2015, it would “exercise prosecutorial discretion in determining whether to bring enforcement actions, with particular consideration given

2

We provide more specifics about the roles of the County and

State as pertinent to our substantive analysis, below.

App. 7

to the extent to which States and other entities have

made good faith efforts to bring their home care programs into compliance with the FLSA.” 80 Fed. Reg.

65,646, 65,646 (Oct. 27, 2015).

On December 1, 2015, the State notified all counties that it would begin implementing the rule on February 1, 2016. The County supported the State’s

implementation plan by training County staff on the

new overtime requirements, conducting information

sessions for providers and recipients, and developing

informational materials. California began paying overtime wages to providers on February 1, 2016.

Ray filed suit in June 2017, seeking relief for unpaid overtime wages between January 1, 2015, and

February 1, 2016. After we decided Ray I, the district

court conditionally certified a putative collective consisting of IHSS providers in Los Angeles County who

worked overtime between January 1, 2015, and January 31, 2016. More than 10,000 providers opted in as

plaintiffs.

The parties filed several motions for partial summary judgment. First, Ray sought partial summary

judgment on the issue of whether the County was liable for liquidated damages for the time period after October 13, 2015—the date that Weil II mandated. The

district court denied the motion, ruling that there was

a “factual dispute as to whether the County [was]

Plaintiffs’ employer,” and that the County had “presented evidence of its efforts to comply with the FLSA,

App. 8

sufficient to avoid summary judgment as to its good

faith defense to liquidated damages at this stage.”

Second, the County asked the district court to find

that the statute of limitations for Ray’s FLSA claims

was two years, rather than three years for “willful” violations. The district court granted partial summary

judgment to the County on this issue, ruling that “the

County’s inability to implement overtime payment to

IHSS providers demonstrates as a matter of law that

the County’s alleged violation of the FLSA was not

‘willful,’ ” and that “the undisputed facts in the record

show that the County did not act with knowing or reckless disregard of whether its conduct was prohibited by

the FLSA.”

Finally, both sides moved for partial summary

judgment on the issue of whether the County was an

employer of IHSS providers. Only an employer covered

by the statute can be liable under the FLSA for failing

to pay overtime compensation. After weighing several

factors, the district court held that “as a matter of law

. . . the ‘economic reality’ is that the County is not an

employer of IHSS providers.” The court therefore

granted summary judgment in favor of the County.

Ray timely appealed all three orders. Because the

district court’s determination that the County does not

employ IHSS providers could be dispositive of the entire action, we address the last order first.

App. 9

II.

The district court erred in granting summary

judgment to the County on the ground that the County

does not employ IHSS providers.

“The FLSA broadly defines the ‘employer-employee

relationship[s]’ subject to its reach.” Torres-Lopez v.

May, 111 F.3d 633, 638 (9th Cir. 1997) (alteration in

original) (citation omitted). “ ‘Employ’ includes to suffer or permit to work.” 29 U.S.C. § 203(g). “ ‘Employer’

includes any person acting directly or indirectly in the

interest of an employer. . . .” Id. § 203(d).

“[A]n employee may have more than one employer

under the FLSA.” Torres-Lopez, 111 F.3d at 638. DOL

so recognized in a regulation providing guidance on

joint employment. 29 C.F.R. § 791.2 (2019).3 “All joint

employers are individually responsible for compliance

with the FLSA.” Bonnette v. Cal. Health & Welfare

Agency, 704 F.2d 1465, 1469 (9th Cir. 1983) (citing 29

C.F.R. § 791.2(a)), disapproved of on other grounds by

Garcia v. San Antonio Metro. Transit Auth., 469 U.S.

528 (1985). Like the employer-employee relationship

itself, “the concept of joint employment should be defined expansively under the FLSA.” Torres-Lopez, 111

F.3d at 639. The parties agree that, to decide whether

the County is a joint employer of IHSS providers, we

must consider the “economic reality,” applying the four

factors enumerated in Bonnette: “whether the alleged

3

Section 791.2 is not currently in effect but was in effect during the time period at issue in this case. See 86 Fed. Reg. 40,939

(July 30, 2021).

App. 10

employer (1) had the power to hire and fire the employees, (2) supervised and controlled employee work

schedules or conditions of employment, (3) determined

the rate and method of payment, and (4) maintained

employment records.” 704 F.2d at 1469–70.

Ray maintains that Bonnette directly controls this

case. Bonnette held that the State and three counties

(not including Los Angeles County) were joint employers of IHSS providers, then called “chore workers,”

“under the FLSA’s liberal definition of ‘employer.’ ” 704

F.2d at 1470. The County disagrees that Bonnette is

dispositive, and points to differences between the IHSS

program operating in Los Angeles County today and

the programs analyzed in Bonnette. We conclude that

Bonnette’s analysis and result do apply here, notwithstanding the differences identified by the County.

Bonnette addressed whether recipients of services

were the sole employers of IHSS providers for FLSA

purposes or whether the State and counties were joint

employers as well. We reasoned that the State and

counties had “complete economic control” over the employment relationship, because they paid the providers’ wages and “controlled the rate and method of

payment.” Id. The State and counties also “maintained

employment records.” Id. Additionally, the State and

counties “exercised considerable control over the nature and structure of the employment relationship.”

Id. They made the “final determination, after consultation with the recipient, of the number of hours each

chore worker would work and exactly what tasks

would be performed.” Id. Although Bonnette did not

App. 11

take a position on whether the State and counties

should be “viewed as having had the power to hire and

fire” providers, we observed that “their power over the

employment relationship by virtue of their control over

the purse strings was substantial.” Id. In light of the

economic and structural control the State and counties

exercised, Bonnette concluded that the State and the

counties were joint employers of IHSS providers. Id.

The most significant change between the IHSS

program when Bonnette was decided and now concerns

the payment of providers. At the time of Bonnette, the

counties were responsible for making payments either

to recipients of services, who then paid their providers,

or directly to providers. Bonnette, 704 F.2d at 1468. The

counties did not fund those payments, however. The

federal government provided 75% of the funding for

the program and the State, 25%. Id. at 1467; Bonnette

v. Cal. Health & Welfare Agency, 525 F. Supp. 128, 130

(N.D. Cal. 1981). The “counties were relieved of any financial responsibility.” 525 F. Supp. at 130.4

Today, payroll is consolidated statewide, and the

State issues paychecks to IHSS providers. We are not

persuaded that the State’s assumption of payroll responsibility changes Bonnette’s analysis. The County continues to exercise considerable economic and structural

4

The County maintains that it has “always contributed

funds that make up a small fraction of the total IHSS program

costs,” citing a document from the Legislative Analyst’s Office

showing that before 1991, counties were responsible for 3% of program costs.

App. 12

control over the employment relationship in a variety

of ways.

As to economic control, the record shows that the

County contributes a substantial amount of funding to

the IHSS program. As the result of a 1991 “realignment” of State and county responsibilities for social

services, counties are now responsible for 35% of the

nonfederal costs of the program.5 See Cal. Welf. & Inst.

Code § 12306(c) (1992). The County maintains that its

35% share of program costs is only nominal, because

the State offsets the increase by directing revenue

from sales taxes and vehicle license fees to the counties. See Cal. Welf. & Inst. Code §§ 17602, 17604. The

record indicates, however, that counties have some

flexibility in deciding how to spend the realignment

funds they receive from the State. For one thing, the

funds are deposited in a social services account, which

the County uses to fund a variety of social services

programs, not just the IHSS program. See Cal. Welf.

& Inst. Code § 17602(a). Counties are authorized to

transfer a certain percentage of funds among their social services, health, and mental health accounts.

Moreover, during the time period under consideration in this case, the County contributed significant

additional funding to the IHSS program, apart from

the realignment revenue it received from the State. A

representative of the County testified that in fiscal

5

In 2012, the State passed “Maintenance of Effort” legislation, which capped the counties’ ongoing contributions to the

IHSS program to no more than a 3.5 percent annual increase. Cal.

Welf. & Inst. Code § 12306.15(c)(1), repealed (2017).

App. 13

year 2014-2015, the County paid its share of IHSS program costs using $118 million from its general fund

and $237 million in realignment revenue. The representative also testified that the County’s share of program costs goes toward provider wages.

Given that the County makes a significant financial contribution to provider wages, Bonnette’s finding

that providers “were paid by the [counties and State]”

remains accurate, even though the State is now responsible for cutting the checks.6 704 F.2d at 1470. If

anything, the County’s share of funding for provider

wages is greater than it was at the time of Bonnette.

Additionally, the County now has the authority, either by itself or through a separate entity, to negotiate

for wages covering the providers. Cal. Welf. & Inst.

Code § 12302.25. So the County sets or could set wages.

As mentioned, the County has established a public authority for collective bargaining purposes, the Personal

Assistance Services Council. The County can negotiate

to pay providers a rate above the state minimum

wage, although the State must review and approve all

changes. Cal. Welf. & Inst. Code § 12306.1(a). California pays “65 percent and the County 35 percent of the

6

The California Court of Appeal reached the same conclusion in rejecting a demurrer by Sonoma County to an IHSS provider’s suit for unpaid wages and overtime under the FLSA. See

Guerrero v. Superior Court, 213 Cal. App. 4th 912, 933 (2013), as

modified on denial of rehearing (Mar. 11, 2013). The court held

that, “[a]s was the case in Bonnette, . . . the chore workers’ wages

were determined and paid by the state and its agents, [Sonoma]

County and [the county’s] Public Authority,” although the “providers were paid directly by the state.” Id. (emphasis omitted).

App. 14

nonfederal share of wage and benefit increases negotiated by the Public Authority, with the state contribution capped at a maximum amount set by statute.”

Guerrero, 213 Cal. App. 4th at 933 (citing Cal. Welf. &

Inst. Code § 12306.1(c), (d)). Between 2012 and 2016,

the County requested pay increases for providers and

the State approved those increases. The County therefore “exercised some power in determining the pay

rates” for providers. Torres-Lopez, 111 F.3d at 643.

Such authority is a significant indication of joint employer status even though the employer “was not involved in preparing [employees’] payroll or directly

paying their wages.” Id.7

The County also chooses the method of payment,

as it did at the time of Bonnette. At that time, as today,

California state law “specified three methods by which

the counties could deliver chore worker services: the

counties could hire chore workers directly, contract

with agencies or individuals for such services, or make

direct payment to the recipients for the ‘purchase’ of

chore worker services.” 704 F.2d at 1467 (citing Cal.

Welf. & Inst. Code § 12302). In Bonnette, all three counties had chosen “the third method of delivery.”8 Id.

7

Torres-Lopez held a grower a joint employer of farmworkers

although a labor contractor prepared the payroll and directly paid

the wages.

8

The district court in this case misconstrued the facts in

Bonnette with respect to the counties’ choice of service delivery.

The court stated incorrectly that “[a]ll three counties at issue in

Bonnette chose the first option for assisting the state with the

IHSS program. In other words, the counties opted to hire providers

App. 15

Here, too, the County chose to use the third option, the

“direct payment” method.9 The County therefore exercises at least some control over the method of payment,

as in Bonnette.

Besides exercising substantial economic control,

the County also continues to “exercise considerable

control over the nature and structure of the employment relationship,” as in Bonnette. 704 F.2d at 1470. In

Bonnette, a county social worker would “consult[ ] with

the recipient and others, using a standard county

form,” and “would determine the tasks to be performed

for the recipient by the chore worker and the hours per

week required to perform the tasks.” 704 F.2d at 1468.

Similarly, today a County social worker performs an

initial in-home assessment of the recipient’s needs and

applies state guidelines to determine how many service hours the recipient is eligible to receive. The social

worker reviews a list of twenty-five types of services

directly with money provided by the counties.” The court erroneously distinguished Bonnette on that basis.

9

The statutory language describing the “direct payment”

option refers to payments to recipients, but in Bonnette, payments were sometimes conveyed directly to providers: “At different times the counties used various methods of payment,

including two-party checks payable to the recipient and chore

worker, checks payable directly to the recipient with the understanding that the recipient would pay the chore worker, and

checks payable directly to the chore worker.” 704 F.2d at 1468.

Likewise, today, although payments are conveyed directly to providers, the parties agree that the County uses the third, direct

payment option, presumably because it is evident that the County

is not hiring the providers or contracting with agencies or individuals for such services.

App. 16

that IHSS providers can give and assigns a “functional

rate index” number of 1 to 5 for each of the services for

which the recipient qualifies. The social worker then

authorizes the number of hours allocated to each task,

based on state guidelines prescribing a range of hours

for each task at each functional ranking. The social

worker may deviate from the prescribed range if the

worker justifies the deviation.

Once the County has authorized the tasks and service hours the recipient is entitled to receive, it is up to

the recipient to set the IHSS provider’s schedule, Cal.

Welf. & Inst. Code § 12300.4(d)(1)(A), just as in Bonnette the “recipient was responsible for the day-to-day

supervision of the chore worker,” 704 F.2d at 1468.

“These aspects of the relationship between recipient

and provider are no different than when Bonnette was

decided.” Guerrero, 213 Cal. App. 4th at 936–37.

Today, however, if a recipient needs a provider to

work overtime hours beyond the authorized amount,

the recipient must request County approval, except in

narrow circumstances. And today, County social workers inspect the home to make sure recipients are receiving the care they need.

Finally, the County is the public face of the employer as far as the providers are concerned. Prospective providers attend an orientation session conducted

by County employees at a County field office, where

they view state-provided training materials and sign

state-issued forms. Cal. Welf. & Inst. Code § 12301.24.

The County also assigned dozens of employees to

App. 17

answer providers’ questions regarding the overtime requirements at issue here. And the County maintains

some employment records, including the forms a provider signs when applying for employment, a copy of

the provider’s ID, and a copy of the provider’s Social

Security card.

In light of the economic and structural control the

County exercises over the employment relationship,

we conclude that Bonnette’s holding that counties are

joint employers of IHSS providers applies to the

County. We reverse the district court’s grant of summary judgment to the county and direct the court to

grant partial summary judgment to Ray on this issue.

III.

The district court did not err in granting partial

summary judgment to the County on the issue of

willfulness and denying partial summary judgment to

Ray on the issue of liquidated damages. A review of

the cases addressing willfulness and the assessment of

liquidated damages under the FLSA reflect that a determination of willfulness and the assessment of liquidated damages are reserved for the most recalcitrant

violators. See Alvarez v. IBP, Inc., 339 F.3d 894, 909 (9th

Cir. 2003) (“[W]e will not presume that conduct was

willful in the absence of evidence.”) (citation omitted);

(“[C]ourts need not award liquidated damages in every

instance . . . ”); see also Bratt v. Cnty. of Los Angeles,

912 F.2d 1066, 1072 (9th Cir. 1990) (noting that the

case was not one “like many of those cited by the

App. 18

Employees, where the employer is using ‘ticky-tack’

reasons to attempt to evade the wage and hour laws”)

(alterations omitted). The County does not belong in

that group of recalcitrant employers.

It is undisputed that the County had no ability to

pay overtime wages in the absence of the State making

funds available to satisfy the overtime obligations. See

Ray v. Cnty. of Los Angeles, 935 F.3d 703, 711 (9th Cir.

2019) (Ray I) (“[T]he County contends—and Plaintiffs

do not dispute—that it has no discretion over the action (or inaction that subjected it to potential liability

here: payment of overtime wages under the FLSA.”)

In Ray I, we noted that “[t]he County had no choice

in the matter of the overtime wages, as the State mandated the payment start date.” Id. That conclusion has

not changed. Specifically relying on our opinion in Ray

I, the district court found that “the facts of this case

demonstrate as a matter of law that the County had no

authority or ability to implement overtime pay for [InHome Supportive Services] (IHSS) providers.” District

Court Order, p. 6.

We agree with the district court’s reliance on our

reasoning in Ray I, and its application of that binding

precedent to the facts of this case. Notably, as the district court determined, the payroll systems for IHSS

providers “are all centralized on a state-wide database

App. 19

controlled by [the California Department of Social Services],” rather than by the County. Id.10

The facts of this case are more akin to those declining to impose a willfulness penalty on the employer

in the absence of an affirmative refusal to comply with

the requirements of the FLSA. For example, in Bratt,

we reasoned that there was no evidence in the record

“that the County attempted to evade its responsibilities under the Act.” 912 F.2d at 1072. We explained that

“a decision made above board and justified in public,”

as was done by the County in this case, “is more likely”

made in good faith. Id. (alteration omitted).

We added that liquidated damages “are designed

in part to compensate for concealed violations, which

may [otherwise] escape scrutiny.” Id.

It is undisputed that resolution of the overtime

wages for IHSS providers in California played out in

public, including numerous training sessions on implementing the new FLSA requirements. Under this circumstance, we agree with the district court and with

our precedent in Bratt that the County acted in good

faith. See id.

The facts in this case are in stark contrast to those

in Alvarez, in which we upheld the district court’s determination of “willful conduct.” 339 F.3d at 909. The

employer in Alvarez “took no affirmative action to

10

Our colleague in dissent characterizes the State’s fiscal

control as “a practical matter.” This description is not consistent

with the holding in Ray I.

App. 20

assure compliance with [the FLSA requirements].” Id.

Rather, the employer “attempt[ed] to evade compliance, or to minimize the actions necessary to achieve

compliance.” Id. (footnote reference omitted). We emphasized that the employer “could easily have inquired

into . . . the type of steps necessary to comply” with the

provisions of the FLSA, but failed to do so. Id. (citation

and internal quotation marks omitted).

There is absolutely no evidence in the record that

the County “attempt[ed] to evade compliance, or to

minimize the actions necessary to achieve compliance”

with the overtime provisions of the FLSA. Id. Instead,

the record reflects that the only reason that the County

failed to pay the required overtime wages sooner is because the State controlled the purse strings.

IV.

We REVERSE the district court’s grant of summary judgment to the County on the ground that the

County does not employ IHSS providers. On remand,

the district court is directed to grant partial summary

judgment to Ray on the issue of whether the County is

a joint employer of IHSS providers. The majority AFFIRMS the district court’s decisions granting partial

summary judgment to the County on the issue of willfulness and denying partial summary judgment to Ray

on the issue of liquidated damages; Judge Berzon dissents from those holdings for the reasons stated in her

dissent.

App. 21

AFFIRMED IN PART, REVERSED IN PART, AND

REMANDED.

Ray v. Los Angeles County Department of Public Social Services, No. 20-56245

BERZON, Circuit Judge, concurring in part and dissenting in part:

I fully concur in the per curiam opinion to the extent it holds that the district court erred in granting

summary judgment to the County of Los Angeles on

the ground that the County does not employ In-Home

Supportive Services (“IHSS”) providers. Per Curiam

Op. 10. The opinion rightly holds that based on the

County’s economic and structural control over the employment relationship, the County is a joint employer

of IHSS providers. Per Curiam Op. 18. Notwithstanding that conclusion, the majority holds that because, as

a practical matter, the State controlled the payroll system (1) the County acted in good faith for purposes of

determining whether it has established a defense to

liquidated damages; and (2) the County’s failure to pay

overtime wages could not have been willful for purposes of determining the applicable statute of limitations. Per Curiam Op. 18–21. I disagree as to each

of these holdings. Although the result the majority

reaches on liquidated damages and willfulness may

seem equitable, it is not consistent with the standards

we are obligated to apply under the Federal Labor

Standards Act (“FLSA”). I would therefore reverse the

App. 22

district court’s denial of partial summary judgment to

the plaintiffs (“Ray”) as to liquidated damages, as well

as the district court’s grant of partial summary judgment to the County on the question of willfulness.

I.

“In addition to overtime compensation, successful

FLSA plaintiffs are entitled to liquidated damages in

the amount of the unpaid overtime compensation (i.e.

double damages).” Haro v. City of Los Angeles, 745 F.3d

1249, 1259 (9th Cir. 2014) (citing 29 U.S.C. § 216(b)).

“Liquidated damages are ‘mandatory’ unless the employer can overcome the ‘difficult’ burden of proving

both subjective ‘good faith’ and objectively ‘reasonable

grounds’ for believing that it was not violating the

FLSA.” Id. (quoting Alvarez v. IBP, Inc., 339 F.3d 894,

909–10 (9th Cir. 2003), aff ’d, 546 U.S. 21 (2005)); see 29

U.S.C. § 260. Thus, Ray is entitled to partial summary

judgment on this issue if the County is unable to meet

its burden of establishing either of these two prongs.

Because the County falls short on both, I would hold

that the district court erred in denying the motion for

partial summary judgment.

The majority’s analysis of this issue begins with

the premise that “the assessment of liquidated damages [is] reserved for the most recalcitrant of violators.” Per Curiam Op. 19. That starting premise is just

wrong. Under the FLSA, “liquidated damages represent compensation, and not a penalty.” Chao v. A-One

Med. Servs., Inc., 346 F.3d 908, 920 (9th Cir. 2003)

App. 23

(quoting Local 246 Util. Workers Union v. S. Cal. Edison Co., 83 F.3d 292, 297 (9th Cir. 1996)). “Double damages are the norm; single damages are the exception.”

Id.

Here, Ray moved for partial summary judgment

as to the County’s liability for liquidated damages for

the time period after October 13, 2015, the date Home

Care Ass’n of Am. v. Weil (“Weil II”), 799 F.3d 1084 (D.C.

Cir. 2015), mandated. The district court denied Ray’s

motion on two grounds, ruling first that there was a

“factual dispute as to whether the County [was] Plaintiffs’ employer,” and, second, that the County had “presented evidence of its efforts to comply with the FLSA,

sufficient to avoid summary judgment as to its good

faith defense to liquidated damages at this stage.” The

per curiam opinion’s holding that the County employs

IHSS providers eliminates the first ground. And I

disagree with the district court’s holding that the

County’s evidence creates a triable issue as to whether

the County’s effort eventually to comply with the

FLSA’s overtime requirements is a viable affirmative

defense to the usual liquidated damages for the period

between October 13, 2015, and February 1, 2016, for

which overtime wages have never been paid.

“To satisfy the subjective ‘good faith’ component,

the County [is] obligated to prove that it had ‘an honest

intention to ascertain what the FLSA requires and to

act in accordance with it.’ ” Bratt v. Cnty. of Los Angeles,

912 F.2d 1066, 1072 (9th Cir. 1990) (alterations omitted). For the objective component, the County must prove

it had “objectively ‘reasonable grounds’ for believing

App. 24

that it [did] not violat[e] the FLSA” for the period between October 13, 2015, and February 1, 2016. See

Haro, 745 F.3d at 1259.

The County cites a single case, Bratt, in which we

concluded that an employer (also Los Angeles County

in that case) had successfully made out a good faith

defense to liquidated damages under the FLSA. In

Bratt, there was no evidence “that the County had anything other than an honest intention to comply with

the Act,” satisfying the subjective component of the

test. 912 F.2d at 1072. And the County’s conclusion

that certain employees were exempt from FLSA coverage, based on its interpretation of FLSA regulations,

was “incorrect” but “not unreasonable,” satisfying the

objective component. Id.

Here, the County has asserted on the merits that

it does not employ IHSS providers. But Ray introduced

evidence that the County knew that courts could well

decide it was an employer of IHSS providers for FLSA

purposes: the County knew that DOL and state agencies had taken the position that it was a joint employer

of IHSS providers; there was pending litigation on the

issue; and other counties had been held liable for both

back wages as well as liquidated damages. And the existing judicial precedents, as well as decisions of the

California Labor Commissioner, pointed toward holding the County liable as a joint employer. See Bonnette

v. Cal. Health & Welfare Agency, 704 F.2d 1465, 1470

(9th Cir. 1983); Guerrero v. Superior Court, 213 Cal.

App. 4th 912, 930–37 (2013).

App. 25

Moreover, unlike in Bratt, the County does not argue, for purposes of meeting the narrow defense to the

liquidated damages obligation, that it believed IHSS

providers were not entitled to overtime pay during

the relevant period. Ray pointed to evidence that the

County knew the overtime rule would take effect on

October 13, 2015, when Home Care Ass’n of Am. v. Weil

(“Weil II”), 799 F.3d 1084 (D.C. Cir. 2015) mandated.

See infra pp. 8–9, 12.

Instead, the County maintains that it showed subjective good faith because paying overtime wages required California to make “sweeping” and “complex”

changes to the IHSS program, and the County participated in the State’s efforts. In other words, complying

with the FLSA was difficult and took time, and the

State and County implemented overtime pay as

quickly as they could.

The problem with this argument is that, even if

the County could show that it was not practical to pay

overtime wages before February 1, 2016—more than

three months after Weil II mandated—that showing

alone would not satisfy the subjective component of the

good faith test. To this day, IHSS providers have never

been paid overtime wages for the period between October 13, 2015, and February 1, 2016. And although the

County contends it “took substantial steps to help the

State comply with the FLSA in 2015 and 2016,” nowhere does the County argue that it raised the matter

of paying overtime wages for the period from October

13, 2015, and February 1, 2016 with the State, or that

it took other steps to promote compliance with their

App. 26

joint obligation to pay overtime for that period, even

retroactively. Given the complete failure to pay the

IHSS providers overtime wages for that period either

when they were owed or retroactively and the absence

of any contention by the County that it believed payment was not required,1 the County has not demonstrated “an honest intention to ascertain what the

FLSA requires and to act in accordance with it.” Bratt,

912 F.2d at 1072.

Nor has the County raised a triable issue on the

second required showing, whether it had “objectively

‘reasonable grounds’ for believing that it was not violating the FLSA” after October 13, 2015. See Haro, 745

F.3d at 1259. Notably, the majority’s liquidated damages discussion does not address this essential prong

at all.

The County’s argument on objective reasonableness is threefold: (1) the U.S. Department of Labor

(“DOL”) guidance on the final rule “highlighted the

State”; (2) the February 1, 2016, implementation date

was objectively reasonable, in light of the “shifting legal landscape” and DOL’s time-limited nonenforcement policy; and (3) the State controls payroll for IHSS

providers, and the County had no authority to pay

overtime wages sooner.

1

That the County was aware of the overtime obligation for

the contested period is reinforced by County documents in the record, which discuss the possibility that IHSS providers would be

owed retroactive pay for overtime after October 13, 2015.

App. 27

In support of its first argument, the County cites

an announcement from DOL indicating that the federal agency, in exercising its enforcement discretion,

would give “particular consideration . . . to the extent

to which States and other entities have made good

faith efforts to bring their home care programs into

compliance with the FLSA since promulgation of the

Final Rule.” 79 Fed. Reg. at 60,974. The County does

not explain the significance of this quotation—which

on its face refers to “States and other entities,” not just

“States.” 79 Fed. Reg. at 60,974 (emphasis added). The

sentence certainly is not sufficient to override the rule

that “joint employers are individually responsible for

compliance with the FLSA.” Bonnette, 704 F.2d at

1469. Nor does it establish that DOL does not consider

any counties to be employers of IHSS providers. Elsewhere, DOL has said just the opposite. In 2014, DOL

issued an opinion letter entitled “Joint employment of

home care workers in consumer-directed, Medicaidfunded programs by public entities under the Fair Labor Standards Act,” which explained that “a state itself, a statewide agency that oversees Medicaid

programs, or a county department of aging could all be

potential joint employers of home care workers providing services through a consumer-directed program.”

Dep’t of Labor, Administrator’s Interpretation No.

2014-2, 2014 WL 2816951, at *4 (June 19, 2014).

As for the County’s second contention, DOL’s timelimited non-enforcement policy does not excuse the State

and County’s failure to pay overtime wages before February 1, 2016. After Weil II upheld the overtime rule,

App. 28

DOL said it would not begin enforcing the rule until

November 12, 2015, and that through December 31,

2015, it would “exercise prosecutorial discretion in determining whether to bring enforcement actions.” 80

Fed. Reg. 65,646, 65,646 (Oct. 27, 2015). But as recognized in Ray v. County of Los Angeles (“Ray I”), 935 F.3d

703 (9th Cir. 2019), “[a]n agency’s discretionary decision to hold off enforcement does not and cannot strip

private parties of their rights to do so.” Id. at 715; see

Kinkead v. Humana at Home, Inc., 450 F. Supp. 3d 162,

187, 189 (D. Conn. 2020) (holding, in a private action

to enforce the overtime rule, that defendants’ reliance

on DOL’s non-enforcement policy as a defense to liability and liquidated damages was “not reasonable”).

Moreover, there is record evidence that private enforcement actions could still go forward, and that the

County knew that. Minutes from an October 1, 2015,

meeting of the County’s FLSA Steering Committee noted

that the overtime rule would be “effective 10/13/15”

and that the “only way to ‘postpone’ implementation is

if agencies file a motion with the United States Supreme Court.”2 On November 30, 2015, the California

Welfare Directors Association sent the County a Q&A

document noting that DOL’s non-enforcement policy

“doesn’t insulate employers from potential lawsuits.”

Earlier that month, the California Association of

Counties had circulated similar guidance. As these

2

The Supreme Court denied an application for a stay of the

mandate on October 6, 2015. The Supreme Court denied a petition for writ of certiorari on June 27, 2016. Home Care Ass’n of

Am. v. Weil, 579 U.S. 927 (2016).

App. 29

communications attest, DOL’s decision to delay federal

enforcement of the overtime rule until November 12,

2015 is not informative as to whether the County had

an objectively reasonable belief that no overtime wages

were due to IHSS provides for the period between October 13, 2015, and February 1, 2016.

The County’s third argument—that it lacked authority to pay IHSS providers—is more substantial.

We recognized in Ray I that the County had “no discretion over the action (or inaction) that subjected it to

potential liability here: payment of overtime wages under the FLSA.” 935 F.3d at 711. But although it may

seem anomalous to hold the County liable for unpaid

overtime wages when it ordinarily did not directly remit payment, the FLSA compels that result.

The County has not pointed to any cases excusing

a joint employer from compliance with the FLSA on

the ground that only the other employer had the usual

authority directly to take the actions that would constitute compliance. Such a result would be inconsistent

with the well-established rule that “joint employers

are individually responsible for compliance with the

FLSA.” Bonnette, 704 F.2d at 1469. That rule reflects

the “broad remedial purposes of the [FLSA],” TorresLopez v. May, 111 F.3d 633, 639 (9th Cir. 1997) (citation

omitted), a statute we “construe[ ] liberally in favor of

employees,” Rosenfield v. GlobalTranz Enters., Inc.,

811 F.3d 282, 285 (9th Cir. 2015) (citation omitted). Allowing joint employers to avoid liability for violations of the FLSA by showing they ordinarily did not

perform a particular employer function would risk

App. 30

undermining the statute’s remedial purposes. Holding

joint employers “individually and jointly” responsible

for compliance, regardless of whether, for example, one

joint employer “is controlled by” the other employer

and may not perform some functions, is consistent with

DOL’s longstanding guidance on joint employment. 29

C.F.R. § 791.2(a), (b)(3) (2019).

I would reverse the district court’s denial of partial

summary judgment to Ray on the issue of liquidated

damages.

II.

I would also reverse the district court on the issue

of willfulness. The FLSA has a two-year statute of limitations for actions for unpaid overtime compensation

unless the violation was “willful,” in which case the

statute of limitations is three years. 29 U.S.C. § 255(a).

Ray filed suit on June 7, 2017, seeking relief for

unpaid overtime wages between January 1, 2015, and

February 1, 2016. For IHSS providers who opted into

the collective action after the complaint was filed, the

timeliness of their claims is measured from the date

they filed a written consent to opt into the action. See

29 U.S.C. § 256(b). The district court equitably tolled

the statute of limitations from September 28, 2017, the

date the district court denied the County’s motion to

dismiss, to December 11, 2019, the date the court conditionally certified the collective.3 Ray maintains that

3

That ruling has not been appealed.

App. 31

the County’s alleged violation of the FLSA was willful

beginning on October 13, 2015, when Weil II mandated.

Although some providers opted into the collective action within two years of that date (not counting the

time during which the statute of limitations was equitably tolled), others did not.

To show a willful violation, Ray must prove that

“the employer either knew or showed reckless disregard for the matter of whether its conduct was prohibited by the statute.” McLaughlin v. Richland Shoe Co.,

486 U.S. 128, 133 (1988). I would hold that Ray introduced evidence sufficient to raise a triable issue as to

whether the County “either knew or showed reckless

disregard for the matter of whether its conduct” violated the FLSA between October 13, 2015, and February 1, 2016. See id.

As I have explained, there was evidence that the

County knew (1) that the overtime rule would take effect when Weil II mandated on October 13, 2015, and

(2) that there was a likelihood the courts would hold it

was liable as a joint employer of IHSS providers, particularly given Bonnette, DOL’s position, and the fact

that other counties had been deemed liable. See Bonnette, 704 F.2d at 1470; Guerrero, 213 Cal. App. 4th at

930–37. And Ray introduced evidence that the County

knew that employers could face liability in private lawsuits for failing to pay overtime wages after October

13, 2015, even if DOL was not yet enforcing the new

rule. See supra pp. 8–9.

App. 32

The County maintains that it had no ability to implement overtime pay because the State controls payroll for IHSS providers. But, again, the County does not

cite any authority excusing it from complying with the

FLSA because it is a joint employer with only partial

responsibility for implementing the program. Ray’s evidence was sufficient to create a triable issue as to

whether the County knew or showed reckless disregard for whether the failure to pay overtime wages beginning on October 13, 2015, violated the FLSA. I

would therefore hold that the district court erred in

granting partial summary judgment to the County on

the issue of the length of the limitations period.

III.

For the foregoing reasons, I would hold that the

County is, on the record here, liable for liquidated damages for the period between October 13, 2015 and February 1, 2016. Further, for purposes of determining

whether its conduct was willful and so triggered a

three-year limitations period, I would hold that Ray

raised a triable issue of fact as to whether the County

knew or showed reckless disregard that its conduct violated the FLSA during that period. I therefore respectfully dissent as to those two issues.

App. 33

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

CIVIL MINUTES - GENERAL

Case No. CV 17-04239 PA (SKx) Date October 27, 2020

Title

Trina Ray, et al. v. California Department

of Social Services, et al.

===========================================================================================

Present:

The Honorable

PERCY ANDERSON, UNITED

STATES DISTRICT JUDGE

G. Garcia

Deputy Clerk

Not Reported

Court Reporter / Recorder

N/A

Tape No.

Attorneys Present

for Plaintiffs:

Attorneys Present

for Defendants:

None

None

Proceedings: MOTION FOR PARTIAL SUMMARY

JUDGMENT

Before the Court is a Motion for Partial Summary

Judgment filed by plaintiffs Trina Ray and Sasha

Walker (“Plaintiffs”). (Dkt. No. 132 (“Mot.”).) Defendant

the County of Los Angeles (the “County”) filed an Opposition (Dkt. No. 143) and Plaintiffs filed a Reply (Dkt.

No. 144). The Court construed the County’s Opposition

as the County’s own Motion for Summary Judgment

(Dkt. No. 148) and allowed Plaintiffs the opportunity

to oppose the County’s Motion (Dkt. No. 151). Pursuant

to Rule 78 of the Federal Rules of Civil Procedure and

App. 34

Local Rule 7-15, the Court finds this matter appropriate for decision without oral argument.

I.

Factual and Procedural Background

The following facts are undisputed. California provides domestic in-home services to the aged, the blind,

and the disabled through programs that were initiated

by and funded in part by the federal government.

Homecare providers such as Plaintiffs help recipients

with daily activities including housework, meal preparation, and personal care. Since 1974, these services

have been provided under California’s In-Home Supportive Services (“IHSS”) plan. Cal. Welf. & Inst. Code

(“CWIC”) §§ 12300-12308 (West 1980). California implements the program through regulations promulgated by the California Department of Social Services

(“CDSS”), and the program is administered in part by

California counties, including the County. CDSS ensures uniformity across the State by issuing regulations and other guidelines to direct counties in their

administrative roles. Id. §§ 12301.

The State, counties, and IHSS recipients all play

roles in implementing the IHSS program. See Guerro

v. Superior Court, 213 Cal. App. 4th 912, 920-22 (2013).

The State sets the rules for the program and delegates

day-to-day administration of the program to the counties. The State identifies specific services authorized

under the IHSS program, and creates standardized

“hourly task guidelines” and a “uniform needs assessment tool” for counties to use in assessing individual

App. 35

service needs and service-hour requirements.. CWIC

§§ 12301.1, 12301.2.

Following State guidelines and protocols, counties

process a recipient’s application for IHSS services, assess a recipient’s needs, authorize services and hours,

and periodically reassess a recipient’s needs. Id.

§ 12301.1. Counties also provide for delivery of IHSS

services to recipients and carry out “quality assurance”

including background checks, orientations, and unannounced home visits to confirm service delivery. Id.

§§ 12301.24, 12305.7-12305.87.

Counties have three options for assisting the

State. Counties can: (1) hire in-home supportive personnel, (2) contract with a city, county, agency, local

health district, or individual, or (3) make direct payment to a recipient for the purchase of services. Id.

§ 12302. The County uses the third option, known as

the Direct Payment Mode. Under the Direct Payment

Mode, IHSS providers in the County are paid directly

by the State. The State must “perform or ensure the

performance of all rights, duties and obligations of the

recipient relating to [the] services as required for purposes of unemployment compensation, unemployment

compensation disability benefits, workers’ compensation, retirement savings accounts, . . . federal and state

income tax, and federal old-age, survivors, and disability insurance benefits.” Id. § 12302.2(a)(1). This payroll

function includes paying or transmitting contributions, premiums or taxes under these programs “on the

recipient’s behalf as the employer,” and making relevant payroll deductions from checks paid directly to

App. 36

providers. Id. §§ 12302.1(a)(2), 12302.2(b). The State is

responsible for collecting time cards, maintaining

timekeeping records, and issuing paychecks drawn on

the State’s treasury. Id. § 12300.4.

In addition, each county must act as or establish

an employer for purposes of collective bargaining. Id.

§ 12302.25, subd. (a). If a county establishes a public

authority or contracts with a nonprofit consortium,

those entities are deemed the employer for purposes

of collective bargaining. Id. § 12301.6. In 1997, the

County created the Public Assistance Services Counsel

(“PASC”) to act as the employer of record for collective

bargaining, to establish a registry of potential providers interested in working in the IHSS program, and

to provide access to training for providers and recipients. The PASC bills the County for its services. The

PASC coordinator also provides background checks

for the County. However, the State continues to perform payroll services on the recipient’s behalf. Id.

§§ 12301.6(i)(1), 12302.2(a)(2) (“[c]ontributions, premiums, and taxes shall be paid or transmitted [by the

State] on the recipients behalf as the employer.”).

Recipients of the IHSS program “retain the right

to hire, fire, and supervise the work of any in-home

supportive services personnel providing services for

them.” Id. § 12301.6(c)(2)(B). Recipients are responsible for setting their provider’s schedule. In addition,

the recipient supervises the provider’s work. Providers

work at the times selected by the recipient, subject to

the recipient’s total allotted service hours as determined by the County in accordance with State

App. 37

guidelines. Recipients of personal care services choose

their own provider. Id. § 12303.4.

On January 1, 2015, federal regulations changed

to provide overtime payments to IHSS providers like

Plaintiffs under the Fair Labor Standards Act (“FLSA”).

Following this new rule, the California Assembly

charged CDSS and other State actors with implementing the new overtime rules. Id. § 12300.4(k). The State

shared draft guidance, including All-County Letters,

All-County Informational Notices, and Program Manager Letters to guide all 58 counties in implementing

the new overtime rules. The State also developed web

seminars and videos to train counties and staff on implementation, held FLSA time sheet training, and had

monthly meetings where CDSS informed the counties

of upcoming changes. The County used the State’s letters and training materials to develop handouts, FAQs,

and instructions for IHSS providers.

On June 7, 2017, Plaintiffs filed a putative collective action under Section 216(b) of the FLSA against

the State of California and the County. Plaintiffs’ Complaint seeks relief for themselves and the putative collective for unpaid overtime wages between January 1,

2015 and February 1, 2016. Plaintiffs originally sued

both the State and the County. (See Dkt. No. 1.) Plaintiffs later dismissed the State as a defendant. (See Dkt.

No. 29.) Both Plaintiffs and the County now seek summary judgment on the diapositive issue of whether the

County is an employer of HISS providers.

App. 38

II.

Evidentiary Objections

Both Plaintiffs and the County have objected to

evidence submitted in connection with the motions for

partial summary judgment. Plaintiffs’ evidentiary objections to the County’s evidence are denied as moot,

as the Court does not rely on any evidence submitted

by the County that Plaintiffs’ objected to. See American Guard Services, Inc. v. First Mercury Insurance

Co., 15-cv-9259, 2017 WL 6039975, at * fn. 5 (C.D. Cal.

Apr. 14, 2017) (overruling plaintiff ’s evidentiary objections “as moot because the Court [did] not rel[y] on any

evidence to which an evidentiary objection [was] asserted”).

The Court also overrules the County’s evidentiary

objections to Plaintiffs’ evidence. First, the County objects to virtually all of Plaintiffs’ exhibits for failure to

include a stipulation, declaration, or testimony regarding the exhibits’ authenticity. (See Dkt. No. 143-1,

Def.’s Obj. to Plf. Separate Statement.) “On summary

judgment, the non-moving party’s evidence need not be

in a form that is admissible at trial . . . as long as a

party submits evidence which, regardless of its form,

may be admissible at trial.” Brimberry v. Northwest

Mut. Life Ins. Co., 13-cv-00127, 2013 WL 4677592, at

*3 (C.D. Cal. Aug. 28, 2013). The Court therefore overrules the County’s evidentiary objections based on the

exhibits’ authenticity because these exhibits, most of

which came from the County’s own productions, may

be admissible at trial. For this same reason, the Court

overrules the County’s hearsay objections. See Atkinson v. Kofoed, 06-cv-2652, 2008 WL 508410, at *1 (E.D.

App. 39

Cal. Feb. 22, 2008) (“As to [defendant’s] arguments

about hearsay and authentication, the court finds that

[defendant] fails to support these objections with any

argument that would justify exclusion of the record.”)

Similarly, the Court overrules the County’s objections to evidence based on the evidence’s probative

value purportedly being “outweighed by . . . unfair

prejudice.” Fed. R. Evid. 403. “In the summary judgment context, a court need not exclude evidence for

danger of unfair prejudice, confusion of issues, or any

of the other grounds outlined in Federal Rule of Evidence 403.” Brimberry, 2013 WL 4677592, at *3.

III. Legal Standard

1. Summary Judgment

Summary judgment is proper where “the movant

shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a

matter of law.” Fed.R.Civ.P. 56(a). The moving party

has the burden of demonstrating the absence of a genuine issue of material fact for trial. Anderson v. Liberty

Lobby, Inc., 477 U.S. 242, 256 (1986). “[T]he burden on

the moving party may be discharged by ‘showing’ - that

is, pointing out to the district court - that there is an

absence of evidence to support the nonmoving party’s

case.” Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986).

The moving party must affirmatively show the absence

of such evidence in the record, either by deposition testimony, the inadequacy of documentary evidence, or by

any other form of admissible evidence. See Celotex, 477

App. 40

U.S. at 322. The moving party has no burden to negate

or disprove matters on which the opponent will have

the burden of proof at trial. See id. at 325.

As required on a motion for summary judgment,

the facts are construed “in the light most favorable

to the party opposing the motion.” Matsushita Elec.

Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587

(1986). However, the nonmoving party’s allegation that

factual disputes persist between the parties will not

automatically defeat an otherwise properly supported

motion for summary judgment. See Fed.R.Civ.P. 56(c).

A “mere ‘scintilla’ of evidence will be insufficient to

defeat a properly supported motion for summary judgment; instead, the nonmoving party must introduce

some ‘significant probative evidence tending to support the complaint.’ ” Fazio v. City & County of San

Francisco, 125 F.3d 1328, 1331 (9th Cir. 1997) (quoting

Anderson, 477 U.S. at 249, 252).

2. Employer Under the FLSA

“A defendant must be an ‘employer’ of the plaintiff

to be liable under the FLSA.” Johnson v. Serenity

Transportation, Inc., 15-cv-02004, 2017 WL 1365112,

at *5 (N.D. Cal. Apr. 14, 2017) (citing Bonnette v. Cal.

Health & Welfare Agency, 704 F.2d 1465, 1470 (9th Cir.

1983), abrogated on other grounds by Garcia v. San

Antonio Metro. Transit Auth., 465 U.S. 528 (1985)). Under the FLSA, “employer” is defined as “any person acting directly or indirectly in the interest of an employer

in relation to an employee.” 29 U.S.C. § 203(d). Two or

App. 41

more employers may be “joint employers” for the purposes of the FLSA. Id. “All joint employers are individually responsible for compliance with the FLSA.”

Bonnette, 704 F.2d at 1469. Whether an entity is a

“joint employer” under the FLSA is a question of law.

Torres-Lopez v. May, 111 F.3d 633, 638 (9th Cir. 1997).

“The Ninth Circuit has stated that the concept of

joint employment should be defined expansively under

the FLSA.” Maddock v. KB Homes, Inc., 631

F. Supp. 2d 1226, 1232 (C.D. Cal. 2007) (citing TorresLopez v. May, 111 F.3d 633, 639 (9th Cir. 1997)). “On

the other and, ‘[t]aken literally and applied in this context [too expansive a definition of employer] would

make any supervisory employee, even those without

any control over the corporation’s payroll, personally

liable for the unpaid or deficient wages o[f ] other employees.” Id. (citing Baird v. Kessler, 172 F. Supp. 2d

1305, 1311 (E.D. Cal. 2001)).

To determine whether a defendant is an employer,

courts look to the “economic reality” behind the relationship, and consider the following four factors:

whether the alleged employer “(1) had the power to

hire and fire the employees, (2) supervised and controlled employee work schedules or conditions of employment, (3) determined the rate and method of

payment, and (4) maintained employment records.”

Bonnette, 704 F.3d at 1470.

These factors are meant to guide a court’s analysis, but the ultimate determination must be based

“upon the circumstances of the whole activity.”

App. 42

Rutherford Food Corp. v. McComb, 331 U.S. 772, 730

(1947); Bonnette, 704 F.2d at 1470 (“The [ ] factors . . .

provide a useful framework for analysis . . . but they

are not etched in stone and will not be blindly applied.”

“As a result, summary judgment may be proper even

when some factors favor joint employment and others

do not.” Johnson, 2017 WL 1365112 at *5. The Ninth

Circuit has identified additional factors that might be

applicable, depending on the situation. See Torres, 111

F.3d at 639.1

IV. Analysis

1. Prior Case Law Establishes that the

County does not Employ IHSS Providers

A California Court of Appeal has already held that

the County does not employ IHSS providers. Service

Employees International Union v. County of Los Angeles (“SEIU”) 225 Cal. App. 3d 761 (1990). The Court of

Appeal affirmed a trial court’s finding that

The [C]ounty has no authority to screen providers, control who will be a provider, control

the number of providers (which is unlimited),

or regulate their hours of work, vacations

hiring or termination. While the county is required to fix the providers’ compensation at

not less than the minimum wage, the compensation is paid from the state treasury, with the

1

The only Torres factors that apply here are largely duplicative of the Bonnette factors. Thus, the Court does not address

these factors separately.

App. 43

state assuming responsibility for various deductions for insurance and other benefits.

Id. at 766-77. Under the Direct Payment Mode used

by the County, the Court of Appeal affirmed the trial

court’s finding that the County “exercises no supervisory control over providers.” Id. at 766.

The case law by Plaintiffs is distinguishable. In

Bonnette, the Ninth Circuit looked at whether Solana

County, San Francisco County, Sacramento County,

and California are joint employers of IHSS providers.

704 F.2d at 1467. All three counties at issue in Bonnette chose the first option for assisting the State with

the IHSS program. In other words, the counties opted

to hire providers directly with money provided by the

counties. The Ninth Circuit found that the counties,

along with the state, “exercised considerable control

over the structure and condition of employment,” including by, among other things, paying plaintiffs’

wages, controlling the rate and method of payment,

and maintaining employment records. Id. The Court

therefore found that the counties and state’s “power

over the employment relationship by virtue of their

control over the purse strings was substantial,” and

found that the counties and the state are joint employers of IHSS providers.

Here, in contrast, the County chose the third option, the Direct Payment Mode, for assisting the State

with IHSS providers. Under this option the State pays

providers directly. As discussed in more detail below,

under the Direct Payment Mode the County does not

App. 44

control the purse strings.2 This makes the present case

distinguishable from Bonnette, and as discussed in

more detail below, means that the County is not an

employer of IHSS providers.

2. The Bonnette Factors

The Court finds that the Bonnette factors weigh

in favor of finding that the County is not an employer

of IHSS providers as a matter of law.

a. Power to Hire and Fire IHSS Providers

The Court first looks to whether the County has

“[t]he right, directly or indirectly, to hire, fire, or modify

the employment conditions of the workers.” TorresLopez, 111 F.3d at 640. Here, the Court finds as a

matter of law that the County does not have the authority to hire or fire IHSS providers, and that this

factor weighs in favor of finding that the County is not

an employer of IHSS providers.

Considering all of Plaintiffs’ evidence in the light

most favorable to Plaintiffs, the facts show that the

County plays an administrative roll on behalf of the

State and that the County has no power, absent State

authority, to hire or fire IHSS providers. Plaintiffs’

2

Plaintiffs also cite to Guerrero v. Superior Court as authority for finding the County employs IHSS providers. 213 Cal. App.

4th 912 (2013). However Guerrero involved a demurrer, not a

motion for summary judgment. The court merely held that, at

the pleading stage, a county and public authority could be joint

employers.

App. 45

argue the County plays a large role in the hiring of

IHSS providers because “[b]efore providers can work

in the County IHSS program, they have to meet the

enrollment requirements, which are to attend an inperson orientation, to sign the provider enrollment

agreement, to sign the provider responsibility form, to

provide identification for identity purposes, and also

submit and pass a criminal background check.” (Mot.

at 2, Helland Decl. Ex. 48, Decl. M. Magallanes).) Plaintiffs argue that because these steps take place at

County offices, and providers cannot work in the IHSS

program until they completed these steps, this demonstrates that the County has the ability to hire IHSS

providers. The Court disagrees.

The undisputed facts show that the County performs these administrative tasks at the direction of the

State. The County does not, absent State authority,

have the ability to deviate from these onboarding tasks

or independently determine whether to hire IHSS providers. All of the onboarding documents are provided

by the State, and the orientation for providers is held

on behalf of the State at County offices. (See id. 86:413 (“It’s not that they [the County] themselves are doing a presentation. . . . [The State] give[s] them the

preliminary things that are going to happen that day,

but it’s . . . [the County’s] just facilitating.”)). That the

County helps facilitate the onboarding process on behalf of the State by providing a space for providers to

watch training videos and sign some documents does

not demonstrate that the County has any authority to

hire providers. See Johnson, 2017 WL 1365112, at

App. 46

*13-44 (“[T]he County’s limited involvement in the

hiring process does not establish that the County had

the power to hire . . . technicians for the purposes of

this Bonnette factor,” particularly where “there is evidence that the County must comply with certain state

. . . requirements.”). Once a provider completes all of

the State mandated onboarding tasks, the County has

no authority to refuse to hire a provider. That the

County was “somewhat involved in the hiring process”

does not “tip the balance in favor of joint employment.”

Id. at * 14.

In addition, Plaintiffs argue the County “exercises

its power to hire through the PASC. (Mot. at 3.) The

County created the PASC in 1997 to “[a]ct as employer

of record for collective bargaining purposes,” “maintain

a registry to assist IHSS recipients in finding eligible

providers,” “[p]rovide training to both providers and

recipients,” and “administer new provider enrollment

requirements such as background checks.” (Mot. at 3,

Helland Decl. Ex. 2 PASC’s Role After In-Home Supportive Services Statewide Authority Takes Over Collective Bargaining). Plaintiffs argue that if the County

chose to end its relationship with PASC, it would resume authority for the PASC’s functions, and effectively be an employer of IHSS providers. The Court

disagrees that taking over PASC’s current duties

would render the County an employer.

PASC plays an administrative role similar to that

provided by the County. Namely, PASC helps with

onboarding, screening, and maintaining a list of available providers. None of these tasks demonstrate that

App. 47

the PASC has any discretionary authority when it

comes to hiring and firing providers. See Montoya v.

3PD, Inc., 13-cv-8068, 2014 WL 3385116, at * (D. Ariz.

July 10, 2014) (granting summary judgment under the

FLSA, and finding that “Home Depot requiring [truck

driver] Montoya to pass a criminal background check

and meet [Department of Labor] requirements d[id]

not establish that it had the power to hire and fire

him.”). The California Welfare Code specifically states

that the power to hire and fire remains with the recipient. CWIC § 12302.25(a) (“Recipients of in-home supportive services shall retain the right to choose the

individuals that provide their care and recruit, select,

train, reject, or change any provider under the contract

mode or to hire, fire train, and supervise any provider

under any other mode of service.”). That the PASC and

the County assist the State with administrative

onboarding tasks does not give the PASC or the County

any independent authority to hire providers.

The evidence likewise demonstrates that the

County does not have the power to fire IHSS providers.

Plaintiffs argue the County has “the power to terminate providers if they repeatedly exceeded the number

of weekly hours the County approved for the provider’s

recipient.” (Mot. at 3.) Plaintiffs provide evidence

showing that IHSS providers receive a “violation” if

they worked more than the budgeted overtime hours

without County approval, or exceed the limit of seven

hours of travel time per month. (Id. at 4, Helland Decl.

Ex. 5 Dep’t of Public Social Services FLSA Presentation.) However, Plaintiffs’ own evidence demonstrates

App. 48

that a county issues violations based solely on the

State’s guidelines, and the State determined when to

fire an IHSS provider after a certain number of violations. (See Mot., Ex. 49, Maria Magallanes Dep. 49:211 (“Based on the instructions from the State, if a provider had a second violation, they were sent information they had to review and read.”); Id. 60: 7 - 61:7

(“[T]he different violations have a time limit. So based

on the review and whatever outcome it was as a violation, if it was a fourth violation . . . the State would

then terminate that provider.”); Ex. 9, Fair Labor

Standards Act In-Home Supportive Services Program

Presentation at COLA 002950 (noting that CDSS had

the ultimate authority to determine whether a violation warranted firing a provider)).

Based on the above, the Court finds as a matter of

law that the County does not have the power to hire

and fire IHSS providers, and that this Bonnette factor

weighs in favor of finding that the County is not an

employer of IHSS providers.

b. Control Over Providers’ Work Schedules and Conditions of Employment

Next, the Court finds the County did not exercise

control over the structure and conditions of IHSS provider’s employment. Even considering all of the

County’s evidence, the Court finds as a matter of law

that IHSS recipients, not the County, controlled the

providers’ work schedules and conditions of employment. Plaintiffs argue the County “exerted substantial

App. 49

control over providers’ work schedules by setting the

maximum number of hours, approving deviations from

those hours, and adjudicating punishment for exceeding those hours.” (Mot. at 21.) The Court disagrees.

Plaintiffs’ evidence shows that recipients of IHSS

services applied through the County. (Mot. at 5, M.

Magallanes Decl. 71:14 - 72:15.) A County social

worker would review the recipient’s application and

perform an in-home assessment of the recipient’s

needs.” (Id. 74:19 - 75:1.) (“Based on the information

that the applicant has provided and briefly described

to the social worker during the initial call, [the social

worker] will go into the home and complete the IHSS

application form, asking them different questions on

the form, as well as review the 25 services that IHSS

provides individually, using the State guidelines they

gave us.”) The social worker would then assign a “functional rank index” number of 1-5 for each of the services the recipient qualified for, based on an index

provided by the State. (Id., 75:2-12.) The State provided hourly task guidelines, which assign a range of

eligible hours for each service at each functional ranking. (Id., P. 77:11-16, 78:4-10.) After the social worker

finishes their assessment, the social worker inputs

data into the State’s Case Management and Information Payroll System (“CMIPS”), and the State’s

CMIPS generates an approval notice that the County

then mails to the provider. (Id. 82:18-23.) This approval

notice identifies how many hours the recipient can receive. The County social worker cannot make a determination on their own as to the number of hours to give

App. 50

a recipient outside of the index provided by the State.

(Id. 76:11 - 77:22.)

In addition, the IHSS sheet provided by the State,

and filled out by a County social worker notes that it is

the “responsibility of the [r]ecipient to set a schedule

within the authorized hours [provided to the [r]ecipient] each month.” (Mot. at 6, Helland Decl. Ex. 20.) If

the recipient has “more than one provider, it is the responsibility of the [r]ecipient to set a schedule for each

provider so that the total hours worked by all providers

does not exceed monthly authorized [hours].” (Id.) Further, if a recipient receives services for more than the

authorized number of hours, it is the “responsibility of

the [r]ecipient to provide payment for those hours.”

(Id.) The County conducts annual oversight of the recipient’s needs. CWIC § 12301.1(b)(1).

Even taking all of these facts as true, the Court

finds that the County’s supervision over the number of

hours an IHSS recipient needs does not mean the

County controls the IHSS provider’s work schedule or

conditions of employment. Here, the County’s own evidence demonstrates that the County provides minimal

oversight to ensure IHSS recipients receive adequate

care in compliance with State regulations. While the

County recommends the number of hours an IHSS recipient needs, the recipient, not the County, is responsible for setting a provider’s work schedule, deciding

when a provider should come and go, determining

how many of the recipient’s allotted hours a provider

would work, and paying a provider should the recipient want more services than the hours they were

App. 51

allotted through the IHSS program provided. Id.

§ 12301.6(c)(2)(B). For example, an IHSS recipient

given 10 hours of care under the IHSS program can

choose to hire one provider who works 5 hours two

days a week, one provider who works two hours five

days a week, or two providers, one who works five of

the recipients’ provided hours, and a second who works

the other five hours. The number of hours a recipient

is provided does not determine a provider’s work

schedule. See Zhao v. Bebe Stores, Inc., 247 F. Supp. 2d

1154, 1160 (C.D. Cal. 2003) (holding defendant was

not liable under the FLSA as a joint employer, finding

the defendant did not control plaintiffs’ work conditions because the employer’s supervisors, not the defendant’s personnel, were primarily responsible for the

day-to-day management of the employees in that it

was they who managed employee assignments, shifts,

and work hours.).

Further, while Plaintiffs suggest that a County

worker’s periodic visits to IHSS recipients’ homes

demonstrates the County acted as an employer, the

Plaintiffs’ own evidence shows otherwise. These home

visits were simply to ensure that the IHSS program

was performed according to regulations set by the

State. The home visits were to make sure IHSS recipients’ needs were being met and that the recipient

didn’t require any additional assistance. (Mot. at 7,

Holland Decl. Ex. 48, M. Magallanes Decl. P. 99 L. 25 100 L. 2 (County workers “go in and make sure the recipient is safe in their home and there [are] not additional needs required.”) The use of County employees

App. 52

to ensure State regulations are being met does not

demonstrate that the County has control over providers’ work places. See Zhao, 247 F. Supp. 2d at 116061(clothing store’s use of a compliance monitor to ensure garment manufacturer’s compliance with labor

laws that the Department of Labor required did not

indicate control for determining joint employer relationship); Taylor v. Waddell & Reed Inc., 2010 WL

3212136, at *3 (S.D. Cal. Aug. 12, 2010) (“[C]ompliance

with legal requirements is not indicative of control for

purposes of establishing an employer-employee relationship.”).

Finally, Plaintiffs suggest that the fact that the

County provided training and resources for IHSS providers about overtime and travel time requirements

demonstrates that the County was an employer of

IHSS providers. Again, the Court disagrees. Plaintiffs

point to several documents the County created in an

effort to help train IHSS providers and recipients on

regulations regarding overtime hours and travel time

hour requirements. (See Mot. at 7-9, Exs. 25-35) These

documents simply show that the County provided

training materials and guidance to IHSS providers

and recipients on behalf of the State. This evidence

does not show that the County exercises control over a

provider’s work schedule or conditions of employment.

See Godlewska v. HDA, 916 F. Supp. 2d 246, 259

(E.D.N.Y. 2013) (“Exercising quality control by having

strict standards and monitoring compliance with those

standards does not constitute supervising and controlling employees’ work conditions. . . . This is especially

App. 53

true where the quality control’s purpose is to ensure

compliance with the law or protect clients’ safety.”).

Based on the above, the Court finds the County

does not exercise control over IHSS providers’ work

schedules and conditions of employment. Therefore,

this second Bonnette factor weighs in favor of finding

that the County is not an employer of IHSS providers.

c. Control Over the Rate and Method of

Payment

The third Bonnette factor looks to whether the alleged employer determined the rate and method of the

employees’ pay. Here again, the Court finds this factor

weighs in favor of finding as a matter of law that the

County is not an employer of IHSS providers.

First, Plaintiffs argue the County shares financial

responsibility for IHSS providers’ wages through a

“Maintenance of Effort” (‘MOE’) arrangement with the

State.” (Mot. at 9, Ex. 53 30(b)(6) Dep. of V. Zamirripa

15:4-8 (“So the State gives us every month, for, for our

MOE requirement – which is the maintenance of effort

apportionment that the State imposes on counties –

and in the case of LA County, we receive a monthly

billing from the State requesting payment for . . .

that”).) Under this agreement, the State sends the

County a bill each month for its share of IHSS costs,

which the Department of Social Services pays out of

County funds appropriated in an annual budget.” (Id.)

The money goes towards funding the County’s share

of the program. (Id. 18:19-23.) In addition, Plaintiffs

App. 54

argue the County “urg[ed] the Board of Supervisors to

‘join Alameda and Ventura counties to provide a path

to an increased compensation, including health benefits, above $12.00 per hour.” (Mot. at 21.)

The Court finds this evidence does not demonstrate as a matter of law that the County had control

over the rate or method of payment for IHSS providers.

First Plaintiffs’ own evidence demonstrates that the

County helped negotiate a pay increase alongside the

IHSS providers’ union, and the County’s minor role

in supporting IHSS providers in adjusting wage rates

was subject to State approval, and ultimately paid

by the State. (Holland Decl. Ex. 53, 30(b)(6) Decl. V.

Zamirripa 29:9-14 (“[T]he County has the ability to

negotiate for wage increases for the providers . . . with

the union.”)

In SEIU, the California Court of Appeals affirmed

the trial court’s finding that “[w]hile the [C]ounty [of

Los Angeles] is required to fix the provider’s compensation at not less than the minimum wage, the compensation is paid from the state treasury, with the

state assuming responsibility for various deductions

for insurance and other benefits.” 225 Cal. App. 3d at

766-77. Further, the Ninth Circuit has already recognized that the State controls IHSS providers’ payroll.

Ray v. County of Los Angeles, 935 F. 3d 703, 712 (9th

Cir. 2019) (“Los Angeles is not a constituent member of

the Union, but it acted at the direction of the State and

had no authority over the payments at issue.”). The

facts provided by Plaintiffs merely demonstrate that

the County can advocate for the State to provide a pay

App. 55

raise to IHSS providers, but the State ultimately determines whether or not to provide a raise. Thus, the

County, absent State authority, does not have the discretion to provide pay raises for IHSS providers.

The case law cited by Plaintiffs does not support

finding otherwise. (See Mot. at 21, citing HardgersPowell v. Angels in Your Home LLC, 330 F.R.D. 89, 109

(W.D.N.Y. 2019)). In Hardgers-Powell, the Court found

that the fiscal intermediary was an employer of Consumer Directed Personal Assistance Program (CDPAP)

aides where the fiscal intermediary “processes each

CDPAP’s wages and benefits, processes all tax and

wage withholdings, complies with worker’s compensation, disability, and unemployment insurance requirements, and maintains personnel records.” Id. The

Court found the “fiscal intermediary’s responsibilities

[went] beyond those of a mere payroll-processing company.” Id. “Most importantly, the fiscal intermediary

[was] responsible for establishing the amount of each

[CDPAP’s] wages.” Id. (internal quotations omitted).

Here, Plaintiffs’ own evidence demonstrates the

County did not have the authority to set wages absent

the State’s approval. Thus, the Count finds this factor

weighs in favor of finding that the County is not an

employer of IHSS providers.

d. Maintaining Employment Records

The final Bonnette factor considers whether the

County maintains employment records for IHSS providers. Plaintiffs argue “[t]he [C]ounty maintained a

App. 56

file on each provider in its offices, first in hard copy

form and then in electronic form.” (Mot. at 23.) Plaintiffs further argue that when “providers needed to

change their address, they called the County.” (Id.)

Finally, Plaintiffs argue the “undisputed facts show

that County employees were directly responsible for

entering information about providers into CMIPS.”

(Id.)

Even assuming all of this is true, this does not

demonstrate that the County maintained employment

records for purposes of establishing an employeremployee relationship. First, the fact that the County

has access to CMIPS, which undisputedly is a centralized State database, “cannot and should not be equated

with [the County’s] control, either direct or indirect,

over Plaintiffs’ payroll records, wages, or working conditions.” Zhao, 247 F. Supp. 2d at 1160. Similarly, the

County’s maintenance of background documents does

not support a finding that the County is an employer.

See Johnson, 2017 WL 1365112, at *17. The State undisputedly requires the County to maintain certain

records as part of its quality control function. This is

not the role of an employer. See Godlewska, 916

F. Supp. 2d at 262 (finding fourth Bonnette factor did

not weigh in favor of employer-employee relationship

where the defendant only reviewed certain employment records) (internal quotations omitted). Thus, the

Court finds the fourth Bonnette factor weighs in favor

of finding that the County is not an employer of IHSS

providers.

App. 57

Conclusion

Considering all of the evidence submitted by

Plaintiffs, the Court finds as a matter of law that the

“economic reality” is that the County is not an employer of IHSS providers. The Court therefore denies

Plaintiffs’ Motion for Summary Judgment and, after

providing Plaintiffs an opportunity to respond and

submit additional briefing, grants summary judgment

in favor of the County. Zhao, 247 F. Supp. 2d at 1161

(denying plaintiffs’ motion for summary judgment on

issue of joint employer status and finding as a matter

of law that defendant was not a joint employer under

the FLSA).

Under the FLSA, only an “employer” can be held

liable for failing to pay overtime compensation. 29

U.S.C. § 207. Because the Court finds as a matter of

law that the County is not an employer of HISS providers, the County cannot be held liable for failing to

pay overtime compensation. Thus, Plaintiffs cannot

state a claim for violation of the FLSA against the

County. Therefore, even though the parties’ motions

are framed as partial motions for summary judgment,

the issue of whether the County is an employer of

HISS providers is diapositive of the entire case. Moreau v. Air France, 356 F.3d 942, 946-47 (9th Cir. 2004)

(affirming order granting summary judgment where

plaintiff failed to establish that defendant was plaintiff ’s employer). Thus, the Court grants summary judgment in favor of the County. The Court will issue a

judgment consistent with this Order.

App. 58

IT IS SO ORDERED.

App. 59

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

TRINA RAY, individually, and

on behalf of others similarly

situated,

Plaintiff-Appellee,

No. 17-56581

D.C. No.

2:17-cv-04239-PA-SK

v.

COUNTY OF LOS ANGELES,

Defendant-Appellant.

TRINA RAY; SASHA WALKER,

individually, and on behalf of

all others similarly situated,

Plaintiffs-Appellants,

No. 18-55276

D.C. No.

2:17-cv-04239-PA-SK

v.

LOS ANGELES COUNTY

DEPARTMENT OF PUBLIC SOCIAL

SERVICES, Erroneously Sued

As County of Los Angeles,

Defendant-Appellee.

Filed October 8, 2019

ORDER

App. 60

Before: Kim McLane Wardlaw and Mark J. Bennett,

Circuit Judges, and Kathleen Cardone,*

District Judge.

Order

ORDER

The opinion filed on August 22, 2019 is amended

as follows:

On page six of the opinion, in the paragraph beginning “As employers of the homecare providers,” replace <As employers of the homecare providers, the

State and County> with <Assuming, without deciding,

the State and County are employers of the homecare

providers, they>.

With this amendment, the panel votes to deny the

appellant’s petition for panel rehearing. [Dkt. 51]

Judges Wardlaw and Bennett vote to deny the appellant’s petition for rehearing en banc [DKT No. 51], and

Judge Cardone so recommends. The full court has been

advised of the petition for rehearing en banc, and no

active judge has requested a vote on whether to rehear

the matter en banc. Fed. R. App. P. 35. The petition for

panel rehearing and rehearing en banc is therefore

DENIED. No further petitions for panel or en banc rehearing shall be permitted.

* The Honorable Kathleen Cardone, United States District

Judge for the Western District of Texas, sitting by designation.

App. 61

IT IS SO ORDERED.

App. 62

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

TRINA RAY, individually, and on

behalf of others similarly situated,

Plaintiff-Appellee,

v.

No. 17-56581

D.C. No.

2:17-cv-04239PA-SK

COUNTY OF LOS ANGELES,

Defendant-Appellant.

TRINA RAY; SASHA WALKER,

individually, and on behalf of

all others similarly situated,

Plaintiffs-Appellants,

No. 18-55276

D.C. No.

2:17-cv-04239PA-SK

v.

LOS ANGELES COUNTY DEPARTMENT

OF PUBLIC SOCIAL SERVICES,

Erroneously Sued As

County of Los Angeles,

Defendant-Appellee.

OPINION

Appeal from the United States District Court

for the Central District of California

Percy Anderson, District Judge, Presiding

Argued and Submitted March 7, 2019

Pasadena, California

Filed August 22, 2019

App. 63

Before: Kim McLane Wardlaw and Mark J. Bennett,

Circuit Judges, and Kathleen Cardone,* District Judge.

Opinion by Judge Bennett

COUNSEL

Jennifer Mira Hashmall (argued) and Jeffrey B. White,

Miller Barondess LLP, Los Angeles, California, for

Defendant-Appellant/Cross-Appellee.

Matthew C. Helland (argued) and Daniel S. Brome,

Nichols Kaster LLP, San Francisco, California; Philip

Bohrer, Bohrer Brady LLC, Baton Rouge, Louisiana;

for Plaintiff-Appellee/Cross-Appellants.

OPINION

BENNETT, Circuit Judge:

This case concerns whether a county is an arm of

the state and thus entitled to Eleventh Amendment

immunity when it shares responsibility with the state

for implementing a state-wide homecare program. We

also consider the effective date of regulations that

(1) a district court vacated before their original effective date; (2) an appellate court upheld, reversing the

district court; and (3) the agency then decided not to

enforce until a date after the original effective date. We

agree with the district court that the County of Los Angeles is not entitled to Eleventh Amendment immunity

* The Honorable Kathleen Cardone, United States District

Judge for the Western District of Texas, sitting by designation.

App. 64

but disagree as to the effective date of the regulations,

which we hold is the original effective date of January

1, 2015. We thus affirm in part, reverse in part, and

remand.

FACTS

California’s In-Home Supportive Services program

(“IHSS program” or “the program”) provides in-home

supportive services to eligible low-income elderly, blind,

or disabled persons. Homecare providers help recipients with daily activities like housework, meal preparation, and personal care. The program serves hundreds

of thousands of recipients. In the County of Los Angeles alone there are about 170,000 homecare providers

and more than 200,000 recipients. California implements the program through regulations promulgated

by the California Department of Social Services (CDSS),

and the program is administered in part by California

counties. Plaintiffs are current or former Los Angeles

IHSS homecare providers.

The State and its counties share responsibility for

implementing and running the IHSS program. The

CDSS ensures that “in-home supportive services [are]

provided in a uniform manner in every county,” Cal.

Welf. & Inst. Code § 12301(a), and it must “adopt regulations establishing a uniform range of services available to all eligible recipients based upon individual

needs,” id. § 12301.1(a). The State also procures and

implements a “Case Management Information and Payroll System.” Id. § 12317(b).

App. 65

But counties have some oversight of the IHSS program as well. They, like the State, may terminate

homecare providers. See id. § 12300.4(b)(5). And counties evaluate recipients and ensure quality compliance.

See id. § 12301.1. Counties also “ensure that services

are provided to all eligible recipients.” Id. § 12302.

Plaintiffs claim that although they receive paychecks

from the State, the County is responsible for a “share”

of their wages. For example, if a county imposes “any

increase in provider wages or benefits [that] is locally

negotiated,” then “the county shall use county-only

funds” to fund that increase. Id. § 12306.1(a). Each

county also determines whether its providers may exceed the maximum number of hours set by the CDSS.

See id. § 12300.4(d)(3).

As employers of the homecare providers, the State

and County must comply with the Fair Labor Standards Act’s (FLSA) overtime wage requirements. See 29

U.S.C. § 207(a)(1). But that wasn’t always the case.

In 1974, Congress created a “companionship exemption” to the FLSA for employees “employed in domestic service employment to provide companionship

services for individuals who (because of age or infirmity) are unable to care for themselves.” See id.

§ 213(a)(15); Fair Labor Standards Amendments of

1974, Pub. L. No. 93-259, 88 Stat. 55. This exemption

applied to homecare providers like Plaintiffs.

In October 2013, however, the Department of Labor (DOL) promulgated a new rule that changed the definition of “companionship services” so that homecare

App. 66

providers like Plaintiffs would be entitled to overtime

pay under the FLSA. See Application of the Fair Labor

Standards Act to Domestic Service, 78 Fed. Reg. 60,454,

60,454 (Oct. 1, 2013) (codified at 29 C.F.R. pt. 552). The

final rule had an effective date of January 1, 2015. See id.

Before the rule’s effective date, a group of “trade

associations that represent businesses employing workers” subject to the FLSA exemption filed a lawsuit in

the District Court for the District of Columbia. See

Home Care Ass’n of Am. v. Weil, 76 F. Supp. 3d 138, 142

(D.D.C. 2014) (Weil I). The plaintiffs claimed that the

rule was arbitrary and capricious and thus sought to

enjoin its implementation. Id. at 139. At step one of its

Chevron analysis, the district court found that Congress had “clearly spoken” on the issue. Id. at 146. The

district court then vacated the rule, id. at 148, and the

DOL appealed.

On August 21, 2015, the D.C. Circuit reversed and

ordered the district court to enter summary judgment

for the DOL. Home Care Ass’n of Am. v. Weil, 799 F.3d

1084, 1087 (D.C. Cir. 2015) (Weil II). Although the DOL

prevailed, on September 14, 2015 it announced that it

would “not bring enforcement actions against any employer for violations of FLSA obligations resulting

from the amended domestic service regulations for 30

days after the date the mandate issues.”1 Application

1

The DOL also stated:

This 30-day non-enforcement policy does not replace

or affect the timeline of the Department’s existing

time-limited non-enforcement policy announced in October 2014. 79 FR 60974. Under that policy, through

App. 67

of the Fair Labor Standards Act to Domestic Service;

Announcement of 30-Day Period of Non-Enforcement,

80 Fed. Reg. 55,029, 55,029 (Sept. 14, 2015) (codified at

29 C.F.R. pt. 552). The Weil II mandate issued on October 13, 2015.

On October 27, 2015, the DOL said that it would

not begin enforcing the final rule until November 12,

2015. And, echoing its September 14, 2015 statement,

the DOL again said that

from November 12, 2015 through December

31, 2015, [it would] exercise prosecutorial discretion in determining whether to bring enforcement actions, with particular consideration

given to the extent to which States and other

entities have made good faith efforts to bring

their home care programs into compliance

with the FLSA since the promulgation of the

Final Rule.

Application of the Fair Labor Standards Act to Domestic Service; Dates of Previously Announced 30-Day

December 31, 2015, the Department will exercise prosecutorial discretion in determining whether to bring

enforcement actions, with particular consideration

given to the extent to which States and other entities

have made good faith efforts to bring their home care

programs into compliance with the FLSA since the

promulgation of the Final Rule. The Department will

also continue to provide intensive technical assistance

to the regulated community, as it has since promulgation of the Final Rule.

Application of the Fair Labor Standards Act to Domestic Service;

Announcement of 30-Day Period of Non-Enforcement, 80 Fed.

Reg. at 55,029.

App. 68

Period of Non-Enforcement, 80 Fed. Reg. 65,646, 65,646

(Oct. 27, 2015) (codified at 29 C.F.R. pt. 552).

Before the Weil I decision, California (through the

CDSS) began taking steps to “meet the January 1,

2015, implementation date,” including modifying its

systems to “process and calculate overtime compensation.” But after the Weil I decision, the CDSS decided

that it would not implement overtime payments “until

further notice.” After Weil II, the CDSS again said that

it would comply with the overtime requirements—but

not until February 1, 2016.

In June 2017, Ray filed a putative collective action,2 under Section 216(b) of the FLSA, against the

State of California and the County of Los Angeles.

Ray’s complaint sought relief for herself and the putative collective for unpaid overtime wages between January 1, 2015—the rule’s original effective date—and

February 1, 2016, the date on which the State began

paying overtime wages.

As relevant here, the County moved to dismiss the

complaint on Eleventh Amendment immunity grounds.3

In the alternative, the County moved to strike all references in the complaint to overtime wages allegedly

2

Collective actions are provided for in the FLSA and are different from class actions, see Campbell v. City of L.A., 903 F.3d

1090, 1101 (9th Cir. 2018), but the differences are not relevant to

this appeal.

3

Early on, Ray voluntarily dismissed the CDSS as a defendant, and Plaintiffs did not name the State as a defendant in the

now-operative complaint.

App. 69

earned before October 13, 2015—the date on which the

mandate issued in Weil II.

The district court first held that the County had

no Eleventh Amendment immunity. The district court

noted that the Supreme Court has long refused to

grant Eleventh Amendment immunity to counties and

that the Court has already held that California counties are not arms of the State. The district court then

assumed arguendo that a county could be an arm of

the State under the five-factor test that we set out in

Mitchell v. Los Angeles Community College District,

861 F.2d 198 (9th Cir. 1988) for determining whether

an entity is an arm of the state for purposes of Eleventh Amendment immunity. The district court found

that only one of the five factors favored the County, and

thus it held that the County enjoyed no Eleventh

Amendment immunity.

The district court then “reject[ed] Plaintiffs’ efforts to enforce the FLSA companionship exemption

regulations retroactively to January 1, 2015.” Instead,

it held “that the putative collective period extends from

November 12, 2015, through January 31, 2016,” and

not before. The court said that although the Weil II decision applied retroactively, that decision was merely

that the DOL could amend the FLSA and that those

amendments were not arbitrary and capricious. This,

the district court held, differed from “the retroactive

application of the amended regulations themselves.”

The district court reasoned:

App. 70

The rule of law announced by the D.C. Circuit

is given retroactive effect by allowing DOL to

reinstate those regulations without having to

begin a new rule-making process. That is not

the same thing as reinstating an earlier and

judicially vacated effective date and retroactively creating liability for violations of the reinstated regulations as if the District Court’s

vacation of the regulations had never occurred.

The district court also found it “compelling” that

both the D.C. Circuit and the DOL “intended” that the

regulation become effective “no earlier than November

12, 2015.” As evidence of this intent, the district court

pointed to the DOL’s decision not to enforce the new

regulations before that date.

Finally, the district court found that its holding

was consistent “with the general rule that a private

right of action should ordinarily not exist when the applicable rule could not be enforced by the relevant enforcement agency.”

The County filed an interlocutory appeal as to the

denial of Eleventh Amendment immunity. The district

court granted Plaintiffs’ motion to certify for interlocutory appeal the district court’s holding that the putative collective period began on November 12, 2015, and

we granted Plaintiffs’ request to appeal that holding.

DISCUSSION

We review de novo the denial of Eleventh Amendment immunity. Cal. ex rel. Lockyer v. Dynegy, Inc., 375

App. 71

F.3d 831, 843 n.12 (9th Cir. 2004). We construe the motion to strike as a motion to dismiss in part, and thus

we review the effective date holding de novo because it

essentially dismissed Plaintiffs’ overtime claims for

the period between January 1, 2015 and November 12,

2015. See Yamaguchi v. U.S. Dep’t of the Air Force, 109

F.3d 1475, 1482 (9th Cir. 1997).

A. The County is not entitled to Eleventh

Amendment immunity.

Plaintiffs first argue that Eleventh Amendment

immunity is never available to counties. The County

argues that it enjoys Eleventh Amendment immunity

when acting as an “arm of the State.”

Federal courts have long declined to extend Eleventh Amendment immunity to counties.4 Indeed, the

Supreme Court once said that Eleventh Amendment

immunity does not extend to municipal corporations.

4

See, e.g., Lake Country Estates, Inc. v. Tahoe Reg’l Planning

Agency, 440 U.S. 391, 401 (1979) (“[T]he Court has consistently

refused to construe the Amendment to afford protection to political subdivisions such as counties and municipalities, even though

such entities exercise a slice of state power.” (internal quotation

marks omitted)); Lincoln Cty. v. Luning, 133 U.S. 529, 530 (1890)

(holding that the Eleventh Amendment does not bar a suit

against a county, though the principle advanced has changed over

time); Del Campo v. Kennedy, 517 F.3d 1070, 1075–76 (9th Cir.

2008) (“State sovereign immunity . . . does not extend to counties

and similar municipal corporations, even though they share some

portion of state power.” (internal quotation marks omitted) (quoting Mt. Healthy City Sch. Dist. Bd. of Educ. v. Doyle, 429 U.S. 274,

280 (1977))).

App. 72

Mt. Healthy, 429 U.S. at 280. But thirty years later, the

Supreme Court suggested that it was at least possible

for a county to receive Eleventh Amendment immunity. In Northern Insurance Company of New York v.

Chatham County, 547 U.S. 189, 190 (2006), which involved a county-operated drawbridge, the Court stated

that a county might be entitled to Eleventh Amendment immunity if it were “acting as an arm of the

State, as delineated by this Court’s precedents, in operating the drawbridge.”5

The Court cited several cases for this proposition.

First, Alden v. Maine: “The second important limit to

the principle of sovereign immunity is that it bars suits

against States but not lesser entities. The immunity

does not extend to suits prosecuted against a municipal corporation or other governmental entity which is

not an arm of the State.” 527 U.S. 706, 756 (1999). This

sentence means one of two things: either (1) that Eleventh Amendment immunity does not extend to municipal corporations because they are not arms of the

state or (2) that Eleventh Amendment immunity does

not extend to a municipal corporation unless it is acting, in a particular circumstance, as an arm of the

5

At least one circuit has relied on this language and held

that counties might be entitled to Eleventh Amendment immunity. See Fuesting v. Lafayette Par. Bayou Vermilion Dist., 470 F.3d

576, 579 (5th Cir. 2006) (“[A] municipality can be immune from

suit if it was ‘acting as an arm of the State, as delineated by [the

Supreme] Court’s precedent’ ” (alteration in original) (quoting

Chatham, 547 U.S. at 194)). But, to our knowledge, no court has

ever actually extended Eleventh Amendment immunity to a

county.

App. 73

state. Alden in turn cites Mt. Healthy, in which the

Court considered whether “the Mt. Healthy Board of

Education is to be treated as an arm of the State partaking of the State’s Eleventh Amendment immunity,

or is instead to be treated as a municipal corporation

or other political subdivision to which the Eleventh

Amendment does not extend.” Mt. Healthy, 429 U.S. at

280. That citation suggests the former reading.

The Chatham Court also cited Lake Country Estates, but while that case noted that “some agencies exercising state power have been permitted to invoke the

[Eleventh] Amendment in order to protect the state

treasury from liability that would have had essentially the same practical consequences as a judgment

against the State itself,” it also stated that “the Court

has consistently refused to construe the Amendment to

afford protection to political subdivisions such as counties and municipalities, even though such entities exercise a ‘slice of state power.’ ” Lake Country Estates,

440 U.S. at 400–01. Although these passages seem to

support Plaintiffs’ argument that counties never enjoy

Eleventh Amendment immunity, it is not for us to clarify Chatham’s apparently contrary statement.

The Chatham Court ultimately found it dispositive that the County there had conceded below that it

had no Eleventh Amendment immunity and that the

question on which certiorari was granted assumed

that conclusion. Given that the Supreme Court appears to have left open the possibility that a county

could be entitled to Eleventh Amendment immunity

in some cases, we decline to hold to the contrary. We

App. 74

therefore assume without deciding that, consistent

with the Court’s language in Chatham, a county might

be entitled to Eleventh Amendment immunity if acting

as an arm of the state.

1. The County is not an arm of the State

here.

In Mitchell, we set out five factors for determining

whether a government entity is an arm of its state for

Eleventh Amendment immunity purposes: (1) “whether

a money judgment would be satisfied out of state

funds”; (2) “whether the entity performs central governmental functions”; (3) “whether the entity may sue

or be sued”; (4) “whether the entity has the power to

take property in its own name or only the name of the

state”; and (5) “the corporate status of the entity.” 861

F.2d at 201. “To determine these factors, the court looks

to the way state law treats the entity.” Id.

a. First Mitchell factor

“The first Mitchell factor—whether a money judgment . . . would be satisfied out of state funds—is the

most important.” Sato v. Orange Cty. Dep’t of Educ.,

861 F.3d 923, 929 (9th Cir. 2017); see also Beentjes v.

Placer Cty. Air Pollution Control Dist., 397 F.3d 775,

785 (9th Cir. 2005) (noting that the first Mitchell factor

is “the one given the most weight”). The County conceded, both below and on appeal, that it cannot show

that a money judgment would be paid directly with

App. 75

State funds.6 Thus, this factor weighs against Eleventh

Amendment immunity.

b. Second Mitchell factor

As to the second Mitchell factor—whether the

County performs central governmental functions—we

must determine whether the County addresses “a matter of statewide rather than local or municipal concern,

and the extent to which the state exercises centralized

governmental control over the entity.” Beentjes, 397

F.3d at 782 (internal quotation marks omitted) (first

quoting Belanger v. Madera Unified Sch. Dist., 963 F.2d

248, 253 (9th Cir. 1992); then quoting Savage v. Glendale Union High Sch., Dist. No. 205, Maricopa Cty., 343

F.3d 1036, 1044 (9th Cir. 2003)).

To begin, it is unclear whether the second Mitchell

factor concerns whether the County performs central government functions in general or whether the

County performs central government functions in carrying out the particular function at issue—here implementing the IHSS program.

As the district court correctly noted, the closest

analogue in our case law is Streit v. County of Los

Angeles, 236 F.3d 552 (9th Cir. 2001). There, the Los

Angeles County Sheriff ’s Department (LASD) would

check its systems, before releasing a prisoner, to see if

6

The parties discuss at length how the County and the State

allocate the costs of the program, but that is not relevant—what

matters is who would be responsible for satisfying a money judgment against the County, not who pays for the program.

App. 76

the prisoner was wanted by another law enforcement

agency. Id. at 556. This extended the period of incarceration one or two days past the prisoners’ release dates.

Id. The plaintiffs alleged that the County delayed their

release during these checks, in violation of their civil

rights. Id. The LASD argued that because it was an

arm of the state, it was not a “person” that could be

liable for damages under § 1983. Id. at 557.

We looked at the LASD’s performance of the particular function at issue—implementing the pre-release policy—not the LASD’s general function as a

sheriff ’s department. See id. at 567. We held that “conducting the AJIS checks is not a central government

function.” Id. (emphasis added). Thus, it appears from

Streit that we look to whether the County, in performing the particular function at issue, performs a central

government function. This fits with the Court’s statement in Chatham that the county there might have

been entitled to Eleventh Amendment immunity if it

were “acting as an arm of the State, as delineated by

this Court’s precedents, in operating [a] drawbridge.”

Chatham, 547 U.S. at 194 (emphasis added).

i. A matter of statewide rather than

local or municipal concern

The in-home care of the elderly and disabled is a

matter of both statewide and local concern. Plaintiffs

are residents of California, and the IHSS program is a

statewide program implemented through State legislation that provides care to hundreds of thousands of

App. 77

California residents. But Plaintiffs are also, of course,

residents of Los Angeles County, and the County has

an interest in the program and the care provided in

Los Angeles.

ii. The extent to which the state exercises centralized governmental

control over the entity

Here we consider the extent to which the County,

in implementing the program, has “discretionary powers” and “substantial autonomy in carrying out [its]

duties.” Beentjes, 397 F.3d at 783.

The County may negotiate, implement, and pay for

pay raises. See Cal. Welf. & Inst. Code § 12306.1. The

County may also allow its providers to exceed the maximum number of hours that the CDSS has set. See id.

§ 12300.4(d)(3). Thus, the County has discretion to

make some important choices on its own.

But the County contends—and Plaintiffs do not

dispute—that it has no discretion over the action (or

inaction) that subjected it to potential liability here:

payment of overtime wages under the FLSA. In taking

the actions that have subjected it to potential liability,

the County had neither “discretionary powers” nor

“substantial autonomy” in carrying out its duties.

We think this clearly tips the scales in the

County’s favor as to this factor. The County had no

choice in the matter of the overtime wages, as the

State mandated the payment start date. We therefore

App. 78

hold that the second Mitchell factor favors Eleventh

Amendment immunity.

c. Third, fourth, and fifth Mitchell factors

The County does not dispute that it can sue and

be sued (third Mitchell factor), that it has the power to

take property in its own name (fourth Mitchell factor),

or that it has an independent corporate status7 separate from the State (fifth Mitchell factor). Thus, these

three Mitchell factors weigh against Eleventh Amendment immunity.

*

*

*

In sum, the first Mitchell factor is the most important, and it weighs against Eleventh Amendment

immunity. So do the third, fourth, and fifth Mitchell

factors. Only the second factor favors immunity. We

therefore hold that, under Mitchell, the County is not

an arm of the State when it administers the IHSS program, and thus it has no Eleventh Amendment immunity barring this action.

7

The fifth Mitchell factor asks whether the entity has “independent corporate status,” Holz v. Nenana City Pub. Sch. Dist.,

347 F.3d 1176, 1188 (9th Cir. 2003), or is, instead, merely an

agency of the state without an identity that is separate from the

state, Beentjes, 397 F.3d at 785. Here the County does not dispute

its independent corporate status, as the Supreme Court has already held that California counties have independent corporate

status and are not agents of the State of California. See Moor v.

Alameda Cty., 411 U.S. 693, 719 (1973).

App. 79

2. The Supreme Court has not overruled or

undermined Mitchell.

The County argues that we should overrule Mitchell because a later Supreme Court case, Hess v. Port

Authority Trans-Hudson Corporation, 513 U.S. 30 (1994),

undermined it. As a three-judge panel, if we find that

intervening Supreme Court authority is clearly irreconcilable with our own precedent, we must consider

ourselves bound by the intervening higher authority

and consider our precedent effectively overruled. See

Miller v. Gammie, 335 F.3d 889, 900 (9th Cir. 2003). Because Hess is not clearly irreconcilable with Mitchell,

we reject the County’s argument.

In Hess, the Court held that a Congressionally

approved bistate entity—the Port Authority TransHudson Corporation (PATH), created to improve coordination of the “terminal, transportation and other

facilities of commerce in, about and through the port of

New York”—did not have Eleventh Amendment immunity. 513 U.S. at 35, 52–53 (citation omitted). The

County argues that Hess established “indicators of immunity” that undermine the Mitchell test. We disagree.

The Hess Court noted that “current Eleventh

Amendment jurisprudence emphasizes the integrity

retained by each State in our federal system.” Id. at 39.

The Court then emphasized the difference between

PATH and the States of the Union: “The States, as

separate sovereigns, are the constituent elements of

the Union. Bistate entities, in contrast, typically are

App. 80

creations of three discrete sovereigns: two States and

the Federal Government.” Id. at 40.

The Court stated that “[p]ointing away from Eleventh Amendment immunity, the States lack financial

responsibility” for the bistate entity. Id. at 45. Here,

California similarly lacks financial responsibility for

the County generally, but Plaintiffs allege that although California writes their checks, the County pays

a share of their wages and sets their hours of work.

In Hess, “indicators of immunity point[ed] in different directions.” Id. at 47. Perhaps they do here as

well. Los Angeles is not a constituent member of the

Union, but it acted at the direction of the State and had

no authority over the payments at issue. But when

faced with a different dichotomy in Hess, the Court emphasized that the most important factor was whether

judgments against PATH would be paid by the State:

“the vulnerability of the State’s purse [is] the most salient factor in Eleventh Amendment determinations.”

Id. at 48; see also id. at 48–49 (citing cases for the “prevailing view” that the state-treasury factor is “generally accorded . . . dispositive weight”); id. at 51 (stating

that “the Eleventh Amendment’s core concern is not

implicated” if the State is not “in fact obligated to bear

and pay the . . . indebtedness of the enterprise”).8

8

The dissent read the holding even more broadly:

In place of the various factors recognized in Lake Country Estates, Inc. v. Tahoe Regional Planning Agency,

440 U.S. 391, 99 S. Ct. 1171, 59 L.Ed.2d 401 (1979),

for determining arm-of-the-state status, we may now

App. 81

After noting that the bistate entity “was financially self-sufficient,” generated “its own revenues,”

and paid “its own debts,” the Court held that “[r]equiring the [bistate entity] to answer in federal court to injured railroad workers who assert a federal statutory

right, under the FELA, to recover damages does not

touch the concerns—the States’ solvency and dignity—

that underpin the Eleventh Amendment.” Id. at 52.

The same is true here. Mitchell and Hess both emphasize the state-treasury factor. Hess thus fully supports

and does not undermine Mitchell.9

The County argues that Hess emphasized the

amount of control that a state maintains over an entity,

a factor supposedly not mentioned in Mitchell and

one that, according to the County, favors Eleventh

Amendment immunity here. First, as we mentioned

above, the second Mitchell factor does include a “control” inquiry—it just doesn’t make that factor dispositive. In addition, Hess pointed out that “[g]auging

actual control . . . can be a ‘perilous inquiry,’ [and] ‘an

uncertain and unreliable exercise.’ ” 513 U.S. at 47

(quoting Note, 92 Colum. L. Rev. 1243, 1284 (1992)).

substitute a single overriding criterion, vulnerability of

the state treasury. If a State does not fund judgments

against an entity, that entity is not within the ambit of

the Eleventh Amendment, and suits in federal court

may proceed unimpeded.

Id. at 55 (O’Connor, J., dissenting).

9

Los Angeles makes a legitimate point about the unfairness

of the result here. But that unfairness springs from the State and

its implementing legislation, not the Eleventh Amendment. Los

Angeles must air its grievance, if at all, in Sacramento.

App. 82

The Court therefore doubted not only the efficacy but

also the utility of a “control” analysis, and it did not

suggest that control was a favored, much less dispositive, factor in the Eleventh Amendment analysis.10

Hess clearly stated that “rendering control dispositive does not home in on the impetus for the Eleventh

Amendment: the prevention of federal-court judgments that must be paid out of a State’s treasury.” Id.

at 48. And, in specifically discussing the control factor,

the Court noted that even though “ ‘political subdivisions exist solely at the whim and behest of their

State,’ . . . cities and counties do not enjoy Eleventh

Amendment immunity.” Id. at 47 (quoting Port Auth.

Trans-Hudson Corp. v. Feeney, 495 U.S. 299, 313

(1990)).

Finally, the County insists that Hess compels us to

consider the State’s dignity, a factor not mentioned in

Mitchell. Hess noted that the State’s “solvency and dignity . . . underpin the Eleventh Amendment.” 513 U.S.

at 52. That is undoubtedly true. But the State is no

longer a party to this action, and it will not be responsible for an adverse judgment against the County.

10

The control discussed in Hess seems to have gone to overall

control over the entity, not just control within the context of the

particular function at issue: “PATH urges that we find good reason to classify the Port Authority as a state agency for Eleventh

Amendment purposes based on the control New York and New

Jersey wield over the Authority. . . . But ultimate control of every

state-created entity resides with the State, for the State may destroy or reshape any unit it creates.” Id. at 47. Thus, looking at

the State’s overall control over the County as a county would not

help the County’s position here.

App. 83

Allowing this action against Los Angeles does not injure California’s dignity.11

The Supreme Court decided Hess about five years

after we decided Mitchell. And although Hess arose in

a different context than Mitchell-Hess addressed a bistate entity, not a county—nothing in Hess so undermines Mitchell that we have the power to overrule it.

More importantly, even if we used Hess rather than

Mitchell to guide our analysis, we would reach the

same result.

When a non-state entity invokes Eleventh Amendment immunity, the most important factor for determining whether the entity is an arm of the state

remains the state-treasury factor—that is, whether

the state will be liable for a money judgment against

the non-state entity. That factor, and all but one of the

other Mitchell factors, dictates the result here. The

Eleventh Amendment does not bar Plaintiffs’ suit

against Los Angeles.

B. The effective date of the rule is January 1,

2015.

We next consider whether the effective date of the

rule is the original effective date of January 1, 2015 or

some date after the D.C. Circuit reversed the district

11

And, although it would not have altered our analysis, we

note that California has not sought to file an amicus brief (below

or on appeal) arguing either that the County is entitled to Eleventh Amendment immunity or that this case threatens California’s dignity.

App. 84

court’s vacatur. The County argues that the rule cannot have an effective date that is earlier than the date

on which the D.C. Circuit reversed the district court’s

vacatur. Plaintiffs argue that the legal effect of the vacatur is to reinstate the original January 1, 2015 effective date. We agree with Plaintiffs and hold that the

effective date of the rule is January 1, 2015.

1. A January 1, 2015 effective date is not

impermissibly retroactive.

The County argues that a January 1, 2015 effective date is impermissibly retroactive. Plaintiffs argue

that the D.C. Circuit’s decision, not the rule, applies

retroactively, because the D.C. Circuit was “explaining

what the law always was,” and thus reinstating the

original effective date is merely a return to the status

quo ante.

When an appellate court applies “a rule of federal

law to the parties before it,” that interpretation “must

be given full retroactive effect in all cases still open on

direct review and as to all events, regardless of whether

such events predate or postdate [the] announcement of

the rule.” Harper v. Va. Dep’t of Taxation, 509 U.S. 86,

97 (1993). That is because “when a court delivers a ruling, even if it is unforeseen, the law has not changed.

Rather, the court is explaining what the law always

was.” Jones Stevedoring Co. v. Dir., Office of Workers’

Comp. Programs, 133 F.3d 683, 688 (9th Cir. 1997).

When the D.C. Circuit held that the DOL had the

rulemaking authority to promulgate the new rule and

App. 85

that its new rule was a reasonable exercise of that authority, see Weil II, 799 F.3d at 1090, it did not change

the law but merely explained what the law always

was—the district court’s erroneous contrary holding

notwithstanding.

Two cases support our holding. In GTE South, Inc.

v. Morrison, 199 F.3d 733, 738, 740 (4th Cir. 1999), the

Fourth Circuit addressed an issue much like the one

we face: determining the effective date of certain pricing rules, promulgated by the FCC, that the Eighth

Circuit stayed and then vacated before their effective

date. The Supreme Court later reversed the Eighth

Circuit. See AT & T Corp. v. Iowa Utilities Bd., 525 U.S.

366, 385 (1999). The Morrison panel held that “the Supreme Court’s determination that the FCC has jurisdiction to issue pricing rules would appear to compel

the conclusion that the FCC always had such jurisdiction and that the rules apply as of the effective date

originally scheduled.” 199 F.3d at 740 (emphasis added).

The Fourth Circuit emphasized that its holding was

not unfair to the parties who argued for a later effective date because they had “ample notice” of the original effective date and “surely knew that the FCC’s

authority to issue pricing rules might ultimately be upheld by the Supreme Court.” Id. at 741.

In US West Communication, Inc. v. Jennings, 304

F.3d 950, 955 (9th Cir. 2002), we considered a similar

question: whether the regulations that the Fourth Circuit considered in Morrison applied to conduct that

occurred during the period of vacatur. Finding the

Fourth Circuit’s reasoning in Morrison persuasive and

App. 86

applicable, we noted that the Supreme Court’s determination that the regulations were valid meant that

we should apply them “to all . . . agreements arbitrated

under the Act, including agreements arbitrated before

the rules were reinstated.” Id. at 957 (emphasis added).

Relying on Morrison, we held that applying the reinstated regulations to conduct that occurred during the

period of vacatur would not give the regulations an impermissible retroactive effect. Id. at 958.

Morrison and Jennings are analogous to this case

because both involved determining how to apply rules

or regulations that were vacated but ultimately reinstated on appeal. Indeed, Morrison commented not

only on the retroactivity of the Supreme Court’s reversal but also on the effective date of the regulations,

holding that the intervening vacatur did not alter the

original effective date of the pricing rules. 199 F.3d at

740.

Thus, Morrison and Jennings guide our analysis

here. The D.C. Circuit’s holding that the DOL had the

authority to promulgate the new rule and that the rule

was reasonable applies retroactively. As in Jennings,

the regulations apply as of the original effective date.

To hold otherwise could encourage dilatory appellate

litigation. If an erroneously vacated rule or regulation

were not effective until sometime after the mandate issued in a later appeal, then a party might drag out the

appellate process to avoid compliance for as long as

possible. Put differently, an erroneous vacatur cannot

postpone a rule’s effective date until an appellate court

corrects the error sometime in the future. And, as the

App. 87

Fourth Circuit noted in Morrison, in a case like this

everyone knows that the lower court decision might be

reversed on appeal.

The State and its counties knew from October 13,

2013, when the DOL first announced its final rule, that

January 1, 2015 was the rule’s effective date. See Application of the Fair Labor Standards Act to Domestic

Service, 78 Fed. Reg. at 60,454. The State and its counties had a full fifteen months to comply with the final

rule—indeed the State initially said that it would comply with the original effective date, but it changed

course after the Weil I court vacated the rule. That decision may have been reasonable, but it created a monetary risk, as the State and its counties were well

aware that an appellate court might uphold the regulations on appeal.

The district court held that to apply the Weil II decision retroactively would be to “reinstate[ ] an earlier

and judicially vacated effective date and retroactively

creat[e] liability for violations of the reinstated regulations as if the District Court’s vacation of the regulations had never occurred.” That is exactly correct. And

although the district court found that to be unfair, it

would be equally unfair to hold that a putative collective of homecare providers is not entitled to nearly a

year’s worth of overtime wages just because a single

district court issued an erroneous decision that another court reversed on appeal. The State gambled that

Weil I would be affirmed. The effect of that gamble

might be unfair to the County, but the County must

seek any recourse from the State. It is not fair for the

App. 88

homecare providers to bear the financial consequences

of the State’s calculated risk.

2. The DOL’s decision not to enforce a new

rule does not obviate private rights of

action.

According to the County, the DOL’s choice against

enforcing the rule until November 12, 2015 eliminated

the availability of private rights of action until that

date because a private right of action cannot precede

an agency’s enforcement of a rule or regulation. We disagree.

“An agency’s informal assurance that it will not

pursue enforcement cannot preclude a citizen’s suit to

do so.” Ohio Valley Envtl. Coal. v. Fola Coal Co., LLC,

845 F.3d 133, 145 (4th Cir. 2017) (emphasis added).

Congress created a private right of action under the

FLSA for unpaid overtime: “Any employer who violates

the provisions of section 206 or section 207 of this title

shall be liable to the employee or employees affected in

the amount of their . . . unpaid overtime compensation. . . .” 29 U.S.C. § 216(b). An agency’s discretionary

decision to hold off enforcement does not and cannot

strip private parties of their rights to do so. See Ohio

Valley, 845 F.3d at 145 (“Congress enacted the citizen

suit provision of the Clean Water Act to address situations, like the one at hand, in which the traditional enforcement agency declines to act.”).

The district court’s hypothesis that the D.C. Circuit and DOL “intended” that the regulation become

App. 89

effective “no earlier than November 12, 2015” is tenuous and, in any event, irrelevant. First, the D.C. Circuit

said nothing at all on the issue. Second, there is nothing in the several statements of the DOL, which the

district court relied on, that suggest that it intended

its discretionary enforcement choices to preclude private enforcement. Indeed, other than by amending the

rule, the DOL could not have precluded private enforcement even if it wanted to.

The rule’s original effective date remains January

1, 2015. If the DOL “intended” for the effective date be

something other than January 1, 2015, the DOL could

have sought to change that effective date through the

procedures set out in the Administrative Procedure

Act. Were we to hold to the contrary and impose our

view that the DOL’s exercise of discretion amended the

effective date sub silentio, we would in fact be usurping

the rulemaking authority of the DOL. See Nat. Res. Def.

Council, Inc. v. U.S. E.P.A., 683 F.2d 752, 762 (3d Cir.

1982) (holding that a final rule’s effective date is an

“essential part” of that rule and is thus subject to the

rulemaking procedures of the APA).

The effective date of the rule is January 1, 2015.12

12

Although some district courts have reached a different conclusion—see, e.g., Bangoy v. Total Homecare Solutions, LLC, No.

1:15-CV-573, 2015 WL 12672727, at *3 (S.D. Ohio Dec. 21, 2015)

(holding that the plaintiffs failed to state a claim for a violation of

the FLSA between January 1, 2015 and “late August 2015”)—

nearly all of them have reached the same result we reach here,

see, e.g., Kinkead v. Humana, Inc., 206 F. Supp. 3d 751, 752 (D.

Conn. 2016) (holding that the effective date of the rule is January

App. 90

CONCLUSION

We AFFIRM the district court’s holding that the

County is not entitled to Eleventh Amendment immunity and REVERSE the district court’s holding that

the putative collective period began on November 12,

2015, holding instead that the rule’s effective date—

and thus the beginning of the putative collective period—is January 1, 2015. We REMAND for proceedings

consistent with this opinion. Costs shall be awarded to

Plaintiffs-Appellants.

1, 2015, “the effective date set forth by the agency”); Collins v.

DKL Ventures, LLC, 215 F. Supp. 3d 1059 (D. Colo. 2016) (same);

Lewis-Ramsey v. Evangelical Lutheran Good Samaritan Soc’y,

215 F. Supp. 3d 805 (S.D. Iowa 2016) (same).

App. 91

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

CIVIL MINUTES - GENERAL

Case No. CV 17-4239 PA (SKx) Date September 28, 2017

Title

Trina Ray, et al. v. California Dep’t of Soc.

Servs., et al.

===========================================================================================

Present:

The Honorable

PERCY ANDERSON, UNITED

STATES DISTRICT JUDGE

Kamilla Sali-Suleyman

Deputy Clerk

Not Reported

Court Reporter

N/A

Tape No.

Attorneys Present

for Plaintiffs:

Attorneys Present

for Defendants:

None

None

Proceedings: IN CHAMBERS - COURT ORDER

Before the Court is a Motion to Dismiss filed by

defendant County of Los Angeles (the “County”) (erroneously sued as the Los Angeles County Department

of Public Social Services) (Docket No. 53). Also before

the Court is a Motion for Conditional Certification filed

by plaintiffs Trina Ray and Sasha Walker (“Plaintiffs”)

(Docket No. 27). Pursuant to Rule 78 of the Federal

Rules of Civil Procedure and Local Rule 7-15, the Court

finds that these matters are appropriate for decision

without oral argument. The hearings calendared for

App. 92

July 31, 2017 and September 11, 2017, are vacated,

and the matters taken off calendar.

I.

Factual and Procedural Background

Plaintiff Trina Ray commenced this action on June

7, 2017. In her original Complaint, Ms. Ray asserted a

claim for unpaid overtime under the Fair Labor Standards Act “(“FLSA”) on behalf of herself and a putative

collective of In-Home Supportive Services (“IHSS”)

providers against the California Department of Social

Services (“DSS”) and the County. Plaintiffs filed the

First Amended Complaint (“FAC”) on July 21, 2017.

The FAC dropped DSS as a defendant and added Ms.

Walker as a named plaintiff. The FAC seeks to represent an FLSA collective of “all persons who have been

employed by [the County] as IHSS Homecare Providers in the County of Los Angeles, and who were paid

for hours in excess of forty (40) per week at a rate of

less than 1.5 times their regular rate at any time from

January 1, 2015 to February 1, 2016.” (FAC ¶ 2.) There

are approximately 169,246 IHSS providers in the

County. (Docket No. 31 at 4:22-23.)

A. IHSS Program

“ ‘IHSS is a state social welfare program designed

to avoid institutionalization of incapacitated persons.

It provides supportive services to aged, blind, or disabled persons who cannot perform the services themselves and who cannot safely remain in their homes

unless the services are provided to them. The program

App. 93

compensates persons who provide the services to a

qualifying incapacitated person.’ ” Guerrero v. Superior

Court, 213 Cal. App. 4th 912, 920, 153 Cal. Rptr. 3d 315,

321 (2013) (quoting Basden v. Wagner, 181 Cal. App.

4th 929, 931, 104 Cal. Rptr. 3d 394, 395 (2010)). The

state “intends that necessary in-home supportive services shall be provided in a uniform manner in every

county based on individual need. . . .” Cal. Welf. & Inst.

Code § 12301(a). The California Court of Appeal has

described the IHSS program:

The Department [the state Department of

Social Services or DSS] promulgates regulations that implement the program, and county

welfare departments administer the program

under the Department’s supervision. Counties process applications for IHSS, determine

the individual’s eligibility and needs, and authorize services. The county either obtains

and pays the provider of the services, or it

pays the recipient who hires a provider.

...

The services that may be authorized through

IHSS are specified in the DSS Manual sections 30–757.11 through 30–757.19. (DSS

Manual, § 30–757.1.) The Department must

adopt regulations establishing a uniform

range of services available to all eligible recipients based up individual needs, subject

to county plans developed in conformity

with state law. ([Cal. Welf. & Inst. Code ]

§§ 12301.1, 12302.) Counties evaluate the recipients based on those regulations and

App. 94

reassess periodically, but at least annually.

(§ 12301.1) The Department, in consultation

with the counties, must also “establish and

implement statewide hourly task guidelines”

and a standardized tool to assess recipient

needs. (§§ 12301.2, 12309.) Although County

may authorize exceptions to the hourly task

time guidelines for particular services based

on factors set forth in the DSS Manual (see

DSS Manual, § 30–757.1), no exception may

result in the recipient’s total hours exceeding

the maximum monthly limits specified. (Id.,

§ 30–757.1(a)(4).)

...

Counties are tasked with performing “quality

assurance activities,” including establishing a

dedicated, specialized unit or function to ensure quality assurance and program integrity,

including fraud detection and prevention in

the provision of services; performing routine

reviews of supportive case services to ensure

there are accurate assessments of needs and

hours; developing, with the state, policies, procedures, timelines, and instructions under

which counties will receive, resolve and respond appropriately to claims data match discrepancies or other information that indicates

potential overpayments to providers or recipients or third-party liability; monitoring the

delivery of supportive services to detect and

prevent potential fraud by providers, recipients and others to maximize recovery of overpayments. (§ 12305.71, subds.(a), (b), (c).)

Such monitoring may include unannounced

App. 95

home visits to a recipient’s home to verify the

receipt of services. (§ 12305.71, subd. (c)(3)(A),

(B).)

Guerrero, 213 Cal. App. 4th at 920-22, 153 Cal. Rptr.

3d at 321-23 (some citations omitted). “ ‘The program

was originated, and is largely funded, by the federal

government. A state may participate in the program by

paying a portion of the funding and complying with

federal requirements. California participates in the

IHSS program pursuant to . . . section 12300 et seq.

The county administers the program locally on behalf

of the state in accordance with the statute and state

regulations establishing a uniform range of services

available to all eligible recipients. County social workers interview applicants for IHSS services and determine their eligibility and need for such services and

the number of hours of service to which the applicant

is entitled under the regulations.’ ” Id. at 920 n.3, 153

Cal. Rptr. 3d at 321 n.3 (quoting Service Emps. Int’l

Union v. County of Los Angeles, 225 Cal. App. 3d 761,

765, 275 Cal. Rptr. 508, 510 (1990)).

The IHSS program is paid for through a combination of federal, state, and county funds:

[T]he IHSS program is primarily delivered as

a Medi-Cal benefit. Accordingly, around 50

percent of IHSS program costs are paid for by

the federal government. The nonfederal costs

of the IHSS program are shared by the state

and counties. Historically, the state paid for

65 percent of nonfederal program costs and

counties paid for the remaining 35 percent.

App. 96

There are some IHSS costs that are not

shared according to the historical statecounty cost-sharing arrangement. For example, pursuant to state law, the state only participates in funding IHSS provider wages and

benefits up to $12.10 per hour, placing the responsibility on counties to fund 100 percent of

the nonfederal costs of IHSS provider wages

and benefits above $12.10 per hour.

(Docket No. 54, Ex. 1 at 13-14.1) Based on “Maintenance of Effort” legislation that capped a county’s

share of nonfederal IHSS expenses, the share of county

costs fell from 35% in 2012 to 24% in 2016. (Id. at 20.)

As a result of new budget legislation enacted by the

State of California (the “State” or “California”), the

county share of IHSS costs is expected to increase to

36% during the 2017-18 budget year, with the state

share falling to 64%. (Id.; see also Cal. Welf. & Inst.

Code § 12306.16.) IHSS providers such as Plaintiffs

and the collective they seek to represent receive

paychecks issued by the California State Controller.

(FAC ¶ 18; Cal. Welf. & Inst. Code § 12300.4.) DSS processes payroll through a statewide computer system it

operates. Cal. Welf. & Inst. Code § 12317. Counties may

increase IHSS provider wages, but when they do so,

“the county shall use county-only funds to fund both

the county share and the state share, including employment taxes, of any increase in the cost of the program, unless otherwise provided for in the annual

1

Plaintiffs have not objected to the County’s Request for

Judicial Notice.

App. 97

Budget Act or appropriated by statute.” Cal. Welf. &

Inst. Code § 12306.1.

B. FLSA Overtime Rules

The FLSA generally requires employers to pay

overtime at a rate of at least 150% of regular pay to

their employees whenever the employees work more

than 40 hours in a week. 29 U.S.C. § 207(a)(1). The FLSA

does, however, contain exemptions from the overtime

requirements. 29 U.S.C. § 213. In 1974, Congress added

a “companionship exemption” for employees employed

in “domestic service employment to provide companionship services for individuals who (because of age or

infirmity) are unable to care for themselves.” 29 U.S.C.

§ 213(a)(15). In October 2013, the federal Department

of Labor (“DOL”) promulgated new regulations that

changed the definition of “companionship services.”

See 29 C.F.R. §§ 552.6 & 552.109. By changing the

definition of “companionship services,” the new regulations limited the scope of the exemption provided by

29 U.S.C. § 213(a)(15) and made many IHSS providers,

including Plaintiffs and the members of the collective

they seek to represent, eligible for overtime pay under

the FLSA beginning on January 1, 2015. 78 Fed. Reg.

60454-01.

In Home Care Ass’n of America v. Weil, 76 F. Supp.

3d 138 (D.D.C. 2014), a group of IHSS employers challenged DOL’s enactment of the amended regulations.

The United States District Court for the District of

Columbia concluded that the DOL’s revised

App. 98

“companionship services” regulations were inconsistent with the intent of Congress and the language

of the FLSA. On December 31, 2014, the District Court

in Weil temporarily stayed the regulations from going

into effect. (Docket No. 54, Ex. 14.) The District Court,

on January 14, 2015, vacated the regulations. Home

Care Ass’n of America v. Weil, 78 F. Supp. 3d 123

(D.D.C. 2015). As a result of the District Court’s actions, California’s DSS issued an “All-County Letter”

(“ACL”) on January 5, 2015, advising California’s counties that “implementation of the new FLSA regulations

. . . will be delayed until further court clarification.”

(Docket No. 54, Ex. 5.) DSS advised the counties that

the payroll system it operates for IHSS providers “will

not process payments for overtime or travel time until

further clarification is ascertained based on the court

decisions.” (Id.)

DOL appealed the District Court’s order vacating

the regulations. The United States Court of Appeals for

the District of Columbia reversed the District Court’s

invalidation of the regulations on August 21, 2015.

Home Care Ass’n of America v. Weil, 799 F.3d 1084

(D.C. Cir. 2015). The D.C. Circuit remanded the action

to the District Court with instructions to enter summary judgment in favor of DOL. Id. at 1093. The Court

of Appeals issued its mandate on October 13, 2015. In

granting DOL’s request for expedited issuance of the

mandate, the D.C. Circuit concluded that the “mandate

should be issued expeditiously so that the final rule

can be implemented,” noted that the DOL “indicated

that, through December 31, 2015, it will exercise

App. 99

prosecutorial discretion in determining whether to

bring enforcement actions, with particular consideration given to the extent to which States and other entities have made good faith efforts to bring their home

care programs into compliance with the FLSA since

promulgation of the final regulations,” and that DOL

“will not bring enforcement actions against any employer as to violations of FLSA obligations resulting

from the amended regulations until 30 days after the

mandate issues.” (Docket No. 54, Ex. 16.) Consistent

with the representations it had made to the D.C. Circuit to obtain expedited issuance of the mandate, DOL

issued a policy statement on October 27, 2015, confirming that it would not bring enforcement actions against

any employer for FLSA violations of the amendments

to the companionship services regulations for 30 days

after the D.C. Circuit issued its mandate. 80 Fed. Reg.

65646-01. DOL stated that its non-enforcement period

would conclude on November 12, 2015, and that it

would, as a matter of prosecutorial discretion, extend

its period of nonenforcement through December 31,

2015. Id. California’s DSS issued a statement on November 4, 2015, providing that it would start paying

overtime wages beginning on February 1, 2016.

(Docket No. 54, Ex. 17.) DSS issued an ACL on December 1, 2015, notifying “counties of the responsibility to

implement the overtime and travel compensation requirements effective February 1, 2016.” (Docket No. 54,

Ex. 7.)

App. 100

II.

Analysis

In its Motion to Dismiss, the County asserts that

it is entitled to sovereign immunity under the Eleventh Amendment as an arm of the state when it performs its statutory roll in the IHSS program. The

County alternatively contends that this action should

be dismissed because California is a necessary and indispensable party that cannot be joined as a result of

its Eleventh Amendment immunity. The County also

challenges the sufficiency of the FAC by arguing that

Plaintiffs have not alleged with sufficient detail specific workweeks in which they did not receive overtime

pay as required by Landers v. Quality Commc’ns, Inc.,

771 F.3d 638 (9th Cir. 2014).2 In both the County’s Motion to Dismiss and Plaintiffs’ Motion for Conditional

Certification, the parties dispute when the amendments to the companionship services exemption regulations became effective and entitled Plaintiffs and the

putative collective to overtime wages. Plaintiffs seek a

collective period beginning on January 1, 2015, when

the regulations were originally scheduled to take effect. The County contends that the collective period

could not begin any earlier than October 13, 2015,

when the D.C. Circuit issued its mandate in Weil, and

may not have started until November 12, 2015, or later,

when DOL could begin to enforce the regulations.3

2

The Court concludes that the FAC alleges sufficient facts to

satisfy Landers. (See FAC ¶ 24.) The Court therefore denies the

County’s Motion to Dismiss for failure to state a claim.

3

Because Ms. Ray worked as an IHSS provider from 2010

or 2011 “until approximately October 2015,” and then again

App. 101

A. Eleventh Amendment Immunity

The Eleventh Amendment of the United States

Constitution provides that “[t]he Judicial power of the

United States shall not be construed to extend to any

suit in law or equity, commenced or prosecuted against

one of the United States by Citizens of another State,

or by Citizens or Subjects of any Foreign State.” U.S.

Const. amend. XI. “The ultimate guarantee of the Eleventh Amendment is that nonconsenting States may

not be sued by private individuals in federal court.”

Board of Trs. of Univ. of Ala. v. Garrett, 531 U.S. 356,

363, 121 S.Ct. 955, 962 (2001). The Supreme Court has

“ ‘consistently refused to construe the Amendment to

afford protection to political subdivisions such as

counties and municipalities, even though such entities

exercise a slice of state power.’ ” Beentjes v. Placer

County Air Pollution Control Dist., 397 F.3d 775, 777

(9th Cir. 2005) (quoting Lake Country Estates, Inc. v.

Tahoe Reg’l Planning Agency, 440 U.S. 391, 401, 99

S. Ct. 1171, 1177 (1979)). The Supreme Court has also

specifically concluded that California’s counties are

not entitled to Eleventh Amendment immunity. See

beginning in September or October 2016 (FAC ¶ 5), the County

challenges her standing to assert a claim because, if the FLSA

regulations were not in effect until October or November 2015,

she would have no entitlement to overtime wages. Because Ms.

Walker has worked as an IHSS provider from 2006 to the present

(FAC ¶ 7), she has standing no matter when the FLSA regulations became effective. Because at least one of the named plaintiffs has standing to pursue the claims alleged in the FAC

regardless of the effective date of the FLSA regulations at issue,

the Court declines to address the County’s standing argument in

this order.

App. 102

Moor v. Alameda County, 411 U.S. 693, 719, 93 S. Ct.

1785, 1800-01 (1973) (“[A] detailed examination of the

relevant provisions of California law . . . convinces us

that the County cannot be deemed a mere agent of the

State of California.”).

Despite this Supreme Court and Ninth Circuit

precedent establishing that California’s counties may

not assert Eleventh Amendment immunity, the County

contends that it should be considered an “arm of the

state” because the “particular function” performed by

the County in administering the IHSS program is pursuant to California statutory authority and the County

had no authority to pay overtime to IHSS providers

without the State’s consent. (See Docket No. 53 at 12:520 & Docket No. 60 at 3:3-18.) The County therefore

contends that it should be entitled to Eleventh Amendment immunity under the Ninth Circuit’s test for determining if an entity is an arm of the state. See

Beentjes, 397 F.3d at 778 (“In the Ninth Circuit, we

employ a five-factor test to determine whether an entity is an arm of the state: (1) whether a money judgment would be satisfied out of state funds, (2) whether

the entity performs central governmental functions,

(3) whether the entity may sue or be sued, (4) whether

the entity has the power to take property in its own

name or only the name of the state, and (5) the corporate status of the entity.” (quoting Belanger v. Madera

Unified Sch. Dist., 963 F.3d 248, 250-51 (9th Cir. 1992));

see also Mitchell v. Los Angeles Cmty. Coll. Dist., 861

F.2d 198, 201 (9th Cir. 1988).

App. 103

Other than the extent to which a “particular function” performed by an entity might be assessed as part

of the second Mitchell factor in determining if an entity

is entitled to Eleventh Amendment immunity, the

Ninth Circuit does not appear to have adopted the

“particular function” analysis to a county’s assertion

of immunity. The closest the Ninth Circuit appears to

have come to analyzing a particular function is when

it assessed if the Los Angeles Sheriff ’s Department

was acting as an arm of the state “when administering

the local county jails.” Streit v. County of Los Angeles,

236 F.3d 552, 566-67 (9th Cir. 2001). Streit treated the

Sheriff ’s Department as a “separately suable entity”

from the County when it determined that the Sheriff ’s

Department was not entitled to Eleventh Amendment

immunity when administering the local jails. Id. A

focus on the particular function undertaken by the

County appears to be inconsistent with both the binding precedent from the Supreme Court and Ninth Circuit holding that California’s counties are not entitled

to Eleventh Amendment immunity and the Supreme

Court’s description of its jurisprudence in the area that

its “cases have inquired into the relationship between

the State and the entity in question” and that in “making this inquiry, we have sometimes examined ‘the

essential nature and effect of the proceeding’ and

sometimes focused on the ‘nature of the entity created

by state law’ to determine whether it should ‘be treated

as an arm of the State.’ ” Regents of the Univ. of Cal. v.

Doe, 519 U.S. 425, 429-30, 117 S. Ct. 900, 904 (1997)

(citations omitted). The Supreme Court has already

looked at the “nature of the entity created by state law”

App. 104

and concluded that California’s counties are not “arms

of the State.” Moor, 411 U.S. at 719, 93 S. Ct. at 180001.

Even if the Court were not bound by the precedent

declaring that California’s counties are not entitled to

Eleventh Amendment immunity, and could assess the

Mitchell factors in light of the facts presented in this

action, it would conclude that the County is not an

“arm of the state” for purposes of its involvement in the

IHSS program. First, although the County presents

substantial evidence that a large portion of the nonfederal IHSS funds are contributed by the State rather

than the County, the State’s contribution of those

funds does not establish that a money judgment

against the County in this case would be paid with

State rather than County funds. In its Reply, the

County argues for the first time that California Government Code sections 895.2 and 895.6 would impose

upon the State an obligation to contribute a pro rata

share of any judgment. But sections 895.2 and 895.6 of

the California Government Code only apply to “public

entities that are parties to an agreement.” Cal. Gov’t

Code § 895.6. Here, the County has not submitted any

evidence that its involvement in the IHSS program is

subject to an “agreement” as contemplated by these

provisions of the California Government Code. Instead,

the relationship between the County and State appears to be dictated by the statutory scheme created

by sections 12300 through 12317.2 of the California

Welfare and Institutions Code and regulations promulgated pursuant to that statutory authority. The

App. 105

County therefore has not established that a “money

judgment would be satisfied out of state funds.”

Beentjes, 397 F.3d at 778. Because this factor is “the

predominant factor,” the County’s failure to show that

State funds would be used to satisfy a judgment “is

given additional weight.” Id. The County also does not

dispute that it has the power to take property in its

own name, to sue or be sued, and that it has a corporate

status separate from the State. The third through fifth

Mitchell factors therefore weigh against a finding that

the County is an arm of the state.

Only the second Mitchell factor weighs at all in

favor of extending Eleventh Amendment immunity to

the County for its involvement in the IHSS program.

“In assessing the second Mitchell factor—whether the

entity performs a central governmental function—we

evaluate whether the [County] addresses ‘a matter of

statewide rather than local or municipal concern,’ and

‘the extent to which the state exercises centralized

governmental control over the entity.’ ” Id. at 782

(quoting Belanger, 963 F.2d 253 and Savage v. Glendale

Union High Sch., 343 F.3d 1036, 1044 (9th Cir. 2003)).

The California Welfare and Institutions Code states

the California Legislature’s intent “that necessary inhome supportive services shall be provided in a uniform manner in every county based on individual need

consistent with this chapter.” Cal. Welf. & Inst. Code

§ 12301(a). To further this goal, DSS is required to

“adopt regulations establishing a uniform range of services available to all eligible recipients based upon

individual needs.” Cal. Welf. & Inst. Code § 12301.1(a).

App. 106

But within this framework of State oversight, counties

are allowed at least some discretion in how they operate their local IHSS programs. See Cal. Welf. & Inst.

Code § 12302 (involving creation of county plans for

the provision of IHSS services within the counties).

While the Court is sympathetic to the apparent

inequity of making the County liable for overtime payments that the State directed that the counties not

provide until February 1, 2016, through a payroll system controlled and administered by the State, that

inequity does not overcome the four other Mitchell factors that weigh in favor of denying Eleventh Amendment immunity to the County arising out of its role,

with the State, as a joint employer of IHSS providers.

See Bonnette v. Cal. Health & Welfare Agency, 704 F.2d

1465, 1470 (9th Cir. 1983) (citations omitted), disapproved on other grounds by Garcia v. San Antonio

Metro. Transit Auth., 469 U.S. 528, 105 S. Ct. 1005

(1985) (concluding that the State and counties were

“joint employers” of IHSS providers under the FLSA);

see also Guerrero, 213 Cal. App. 4th at 929-30, 153 Cal.

Rptr. 3d at 328-29. The Court therefore concludes that

the County is not entitled to Eleventh Amendment

immunity.

B. Joinder of the State of California as a

Necessary and Indispensable Party

The County alternatively contends that this action

should be dismissed pursuant to Federal Rule of Civil

Procedure 12(b)(7) because the State is a necessary

App. 107

party that cannot be joined in this action without violating its Eleventh Amendment immunity. Rule 19

“prescribes a bifurcated analysis to determine whether

parties should or must be joined.” Takeda v. Northwestern Nat’l Life Ins. Co., 765 F.2d 815, 819 (9th Cir.

1985). “First, a court must determine whether an absent party should be joined as a ‘necessary party’ under subsection (a). Second, if the court concludes that

the nonparty is necessary and cannot be joined for

practical or jurisdictional reasons, it must then determine under subsection (b) whether in ‘equity and good

conscience’ the action should be dismissed because the

nonparty is ‘indispensable.’ ” Virginia Sur. Co. v.

Northrop Grumman Corp., 144 F.3d 1243, 1247 (9th

Cir. 1998). A party is “necessary” under Rule 19(a)(1)

if:

(A) in that person’s absence, the court cannot

accord complete relief among existing

parties; or

(B) that person claims an interest relating to

the subject of the action and is so situated

that disposing of the action in the person’s absence may:

(i)

as a practical matter impair or impede the person’s ability to protect

the interest; or

(ii) leave an existing party subject to a

substantial risk of incurring double,

multiple, or otherwise inconsistent

obligations because of the interest.

App. 108

Fed. R. Civ. P. 19(a)(1). Under Rule 19(b), “[i]f a person

who is required to be joined if feasible cannot be joined,

the court must determine whether, in equity and good

conscience, the action should proceed among the existing parties or should be dismissed.” Fed. R. Civ. P. 19(b).

In deciding whether to proceed with the action despite

the absence of a required party.

The factors for the court to consider include:

(1) the extent to which a judgment rendered

in the person’s absence might prejudice

that person or the existing parties;

(2) the extent to which any prejudice could

be lessened or avoided by:

(A) protective provisions in the judgment;

(B) shaping the relief; or

(C) other measures;

(3) whether a judgment rendered in the person’s absence would be adequate; and

(4) whether the plaintiff would have an adequate remedy if the action were dismissed for nonjoinder.

Fed. R. Civ. P. 19(b). Rule 19(b) “emphasizes practical

consequences and its application depends on the circumstances of each case.” Takeda, 765 F.2d at 819 (citing Provident Tradesmens Bank & Trust v. Patterson,

390 U.S. 102, 118-19, 88 S. Ct. 733, 742-43 (1968)).

As the Court previously stated, the State and

County are “joint employers” of IHSS providers under

App. 109

the FLSA. See Bonnette, 704 F.2d at 1470; see also

Guerrero, 213 Cal. App. 4th at 929-30, 153 Cal. Rptr.

3d at 328-29. “Two or more employers may jointly employ someone for purposes of the FLSA. All joint employers are individually liable for compliance with the

FLSA.” Bonnette, 704 F.2d at 1469; see also Maddock

v. KB Homes, Inc., 631 F. Supp. 2d 1226, 1232 (C.D.

Cal. 2007) (“Two or more employers may jointly employ

an employee and be individually liable under the

FLSA.”). The individual liability of joint employers is

“joint and several liability.” See Boucher v. Shaw, 572

F.3d 1087, 1094 (9th Cir. 2009) (citing with approval

Donovan v. Agnew, 712 F.2d 1509, 1514 (1st Cir. 1983)

for the proposition that “a corporate officer with operational control of a corporation’s covered enterprise is

an employer along with the corporation, jointly and

severally liable under the FLSA for unpaid wages.”);

see also Chao v. A-One Med. Servs., Inc., 346 F.3d 908,

917 (9th Cir. 2003) (citing with approval Moon v. Kwon,

248 F. Supp. 2d 201, 236-38 (S.D.N.Y. 2002) (applying

[29 C.F.R. §] 791.2(a) to find joint and several liability

for overtime wages from joint employers)). “It has long

been the rule that it is not necessary for all joint tortfeasors to be named as defendants in a single lawsuit.”

Temple v. Synthes Corp., 498 U.S. 5, 7, 113 S. Ct. 315,

316 (1990); see also Fed. R. Civ. P. 19 advisory committee’s note to 1966 amendment (“It should be noted

particularly, however, that the description is not at

variance with the settled authorities holding that a

tortfeasor with the usual ‘joint-and-several’ liability is

merely a permissive party to an action against another

with like liability.”).

App. 110

Because the County and State are jointly and severally liable for FLSA violations arising out of their

status as joint employers of IHSS providers, the State

is a permissive rather than necessary party and, “because the threshold requirements of Rule 19(a) have

not been satisfied,” no “inquiry under Rule 19(b) is

necessary.” Temple, 498 U.S. at 8, 111 S. Ct. at 316. The

Court therefore denies the County’s Motion to Dismiss

brought pursuant to Federal Rule of Civil Procedure

12(b)(7).

C. Effective Date of the FLSA Regulations

As the Court has already explained, DOL’s amendments to the regulations concerning the companionship exemption regulations were originally scheduled

to go into effect on January 1, 2015, but the District

Court for the District of Columbia vacated those regulations before their effective date. See Weil, 78 F. Supp.

3d 123. The D.C. Circuit reversed the District Court’s

order and remanded the action “for the entry of summary judgment in favor of DOL. Weil, 799 F.3d at 1097.

In granting DOL’s Motion for

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