68 Litigating CA Wage & Hour Class and PAGA Actions (23rd Edition) Seyfarth Shaw LLP | www.seyfarth.com from one’s obligations.” When someone has an assignment of a fixed term or performs a fixed task, the employer “discharges” (i.e., releases) the employee at the end of the term or completion of the task. Smith analyzed the legislative history and concluded that this interpretation—”discharge” as synonymous with “release from one’s obligations”—was more consistent with the overall purpose of the statute and the strong public policy for immediate payment underlying Section 203. Accordingly, the end of a fixed-term assignment that ends the employment relationship between the employer and employee triggers the obligation for immediate payment under Labor Code sections 201-203. 2. Temporary Employment Agencies In 2006, a slew of class actions were filed against temporary agencies, arguing that the end of every temporary assignment is a “discharge” that triggers the right to immediate payment and the application of waiting time penalties. Temporary agencies typically do not pay wages on the date a given assignment ends, but rather send paychecks in regular one- or two-week intervals (except in the rare case where the agency “fires” the temporary employee by giving notice that the individual will not be considered for further work). In one such class action, Elliot v. Spherion Pacific Work, LLC,336 Seyfarth Shaw obtained summary judgment for the defendant temporary agency. The plaintiff was a Spherion temporary worker for over a year, during which time she completed 15 temporary assignments of varying length. She submitted time sheets for work performed each Friday, and was paid by Spherion on the following Friday via direct deposit. Following what turned out to be her last assignment with Spherion, she was paid pursuant to the normal pay schedule, and continued to seek assignments through Spherion for over a month thereafter. The district court held that the plaintiff was not “discharged” each time one of her temporary assignments ended, noting that she remained employed by Spherion and she understood that assignments would be intermittent. Therefore, she was not entitled to waiting time penalties under the Labor Code.337 The Ninth Circuit affirmed the judgment for the employer.338 In 2009, Labor Code section 201.3 resolved this issue, providing: If an employee of a temporary services employer is assigned to work for a client, that employee’s wages are due and payable no less frequently than weekly, regardless of when the assignment ends, and wages for work performed during any calendar week shall be due and payable not later than the regular payday of the following calendar week. A temporary services employer shall be deemed to have timely paid wages upon completion of an assignment if wages are paid in accordance with this subdivision. 336 572 F. Supp. 2d 1169 (C.D. Cal. 2008), aff’d, 368 Fed. App’x 761 (9th Cir. Feb. 26, 2010). 337 See also Sullivan v. Kelly Servs., Inc., No. C 07-2784 CW, 2008 WL 4891051 (N.D. Cal Nov. 12, 2008) (granting summary judgment in favor of defendant temporary agency on Labor Code Section 201 claim on grounds that plaintiff was not “dismissed” by the agency at the conclusion of a temporary work assignment). 338 Elliot v. Spherion Pacific Work, LLC, 368 Fed. App’x 761 (9th Cir. Feb. 26, 2010); See also Young v. Remx, 91 Cal.App.5th 427 (2023)(staffing agency did not discharge worker when it abruptly ended her assignment, because she remained employed by the agency).
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