KESSLER, J.
¶ 1 Mauricio Aguilar and multiple additional employees of Husco International, Inc. ("the employees"), Husco International, Inc. ("Husco"), and the International Association of Machinists and Aerospace Workers, District No. 10 ("District 10") appeal from a circuit court order denying all of their respective motions for summary judgment. The parties all agree that none of the material facts necessary to resolve the legal issues presented in this case are in dispute. Consequently, all of the parties petitioned for permission to appeal the circuit court's non-final order. We granted all of the petitions. For the reasons explained below, we reverse the circuit court's order and remand for entry of summary judgment in favor of the employees and District 10. We also remand for an order denying Husco's summary judgment motion and for any further action consistent with this opinion that may be appropriate.
¶ 2 This case arises out of a class action wage claim under WIS. STAT. § 109.03(5) (2011-12),
¶ 3 From 1981 to the present, District 10 has been the collective bargaining representative for a bargaining unit of production and maintenance employees at Husco. In 1983, Husco and District 10 agreed to implement certain changes into the employees' collective bargaining agreement ("CBA") with Husco. The agreement provided for a paid 10-minute break, an unpaid 20-minute break and paid wash-up periods totaling five minutes per eight-hour and 20-minute shift, so that employees would work a total of seven hours and 45 minutes for every eight hours of pay.
¶ 5 In November 2006, District 10 became aware that the provision in the employees' CBA providing unpaid 20-minute breaks was unlawful. Donald Griffin, District 10's business representative for the Husco bargaining unit, wrote a letter to Gary Strand, Husco Vice President of Human Resources, asking how Strand planned to resolve the issue. Strand responded that both Husco and District 10 should apply to the DWD for a waiver that would have a prospective and retroactive effect. The effect of the retroactive waiver would eliminate the employees' right to compensation for the unpaid 20-minute breaks already taken. Griffin declined to apply for the retroactive waiver, asserting that District 10 did not have the authority to take away the employees' right to seek back pay for the unlawful unpaid breaks they had already taken.
¶ 6 District 10 filed a complaint with the DWD, seeking back pay, on behalf of the affected Husco employees. In July 2007, the DWD issued a decision declining to order back pay, concluding that it would be inequitable to do so and that the failure to request a waiver was merely a technical violation. However, the DWD ordered Husco to comply with lawful break requirements by October 2007.
¶ 7 In September 2007, District 10 and Husco representatives met to negotiate a solution; however, none was reached. Husco then unilaterally changed the 20-minute breaks to lawful 30-minute unpaid breaks. An arbitrator later rejected Husco's argument that it could permanently switch to 30-minute unpaid breaks, but upheld Husco's right to switch to 30-minute unpaid breaks as a temporary measure. The arbitrator concluded that the CBA did not require District 10 to join in signing a waiver request and that he did not have the authority to insert provisions into the CBA which the parties did not agree upon.
¶ 8 In January 2008, the employees commenced the class action litigation underlying this appeal seeking unpaid wages from Husco. Husco filed a third-party complaint against District 10, alleging: (1) breach of the duty of good faith and fair dealing; (2) equitable indemnity; (3) unjust enrichment; and (4) promissory estoppel.
¶ 10 The circuit court denied all of the motions, explaining:
The parties all petitioned for an interlocutory review of the circuit court's order. These appeals followed.
¶ 11 A party is entitled to summary judgment when there are no disputed issues of material fact and that party is entitled to judgment as a matter of law. WIS. STAT. § 802.08(2).
¶ 12 If the resolution of a state law claim is substantially dependent upon an analysis of an agreement between the parties to a labor contract, then that claim must either be treated as a claim arising under § 301 of the Labor Management Relations Act ("LMRA"), or that claim must be dismissed as preempted under federal labor contract law. See Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 210-212, 105 S.Ct. 1904, 85 L.Ed.2d 206 (1985). The United States Supreme Court, in Allis-Chalmers Corp., explained that:
Id. at 211, 105 S.Ct. 1904.
¶ 13 Section 301 of the LMRA:
Miller Brewing Co. v. DILHR, 210 Wis.2d 26, 37, 563 N.W.2d 460 (1997) (quotation marks and citation omitted). Thus, we must determine whether "the adjudication of the state-law claim depend[s] on the interpretation of the collective-bargaining agreement." See International Ass'n of Machinists & Aerospace Workers, IAM Local 437 v. United States Can Co., 150 Wis.2d 479, 492, 441 N.W.2d 710 (1989).
¶ 14 At the heart of the employees' argument is their contention that Husco violated WIS. STAT. § 109.03(1) and WIS. ADMIN. CODE § DWD 274.02(3) when it did not compensate them for the unpaid 20-minute breaks. The employees argue that, absent a waiver from the DWD, Husco cannot circumvent its statutory obligation to compensate the employees for breaks under 30 minutes. As such, the employees contend that they are entitled to compensation for the unlawful unpaid breaks already taken and that all of Husco's defenses are preempted by federal law. We agree.
¶ 15 WISCONSIN STAT. § 109.03(1) requires employers to pay each employee, during each payroll period, all wages that are earned by the employee.
Pursuant to WIS. ADMIN. CODE § DWD 274.05, parties to a CBA may apply to the DWD for a waiver to the "hours of work" requirement of WIS. ADMIN. CODE § DWD ch. 274. It is undisputed that a waiver was not obtained in this case. Nonetheless, Husco contends that the employees are not entitled to compensation because the employees: (1) are not owed any
¶ 16 A close examination of Husco's defenses indicate that Husco's arguments all depend on an interpretation of the CBA. If the employees waived their right to the wages at issue, they did so in exchange for other benefits under the CBA. If the employees would be unjustly enriched by receiving the statutorily required back wages, it is because of benefits already received under the CBA. If the employees are equitably estopped to claim the statutory wages, it is also because of the CBA. If the employees did not mitigate their damages, it is because (from Husco's perspective) the employees breached the CBA by refusing to jointly petition the DWD for waiver of the obligations Wisconsin law places on the employer.
¶ 17 The United States Supreme Court provided valuable insight when it dealt with the issue of illegal wages in a collective bargaining agreement in Northwest Airlines, Inc. v. Transport Workers Union of America, AFL-CIO, 451 U.S. 77, 101 S.Ct. 1571, 67 L.Ed.2d 750 (1981). In that case, a class action suit was brought against the airline by female flight attendants alleging wage discrepancies between themselves and their male counterparts. Id. at 77, 101 S.Ct. 1571. The wages were agreed to by both the airline and the union; however, a federal district court determined that the wage discrepancies violated both the Equal Pay Act of 1963 and Title VII of the Civil Rights Act of 1964. Id. Following the ruling, the airline sought contribution from the union in a separate action, which formed the basis of the case before the Supreme Court. Id. The Supreme Court held that the contribution claim was not available because the employer was not an intended beneficiary under the Equal Pay Act or Title VII, and the comprehensive remedial scheme in the statutes precluded the court from inferring additional remedies which the legislature had not provided. The reasoning in Northwest Airlines is instructive in the situation before us.
¶ 18 The statutory scheme of WIS. STAT. ch. 109 evidences a clear legislative intent to protect employee rights to wage payment in certain workplace conditions and at certain times. WISCONSIN STAT. § 109.03(1) requires an employer to timely pay all required wages. Additionally, WIS. STAT. § 109.03(5) prohibits the employer from contracting away that obligation.
¶ 19 Because Wisconsin law unambiguously requires payment for the 20-minute breaks and does not allow the employer to contract away that obligation, the defenses are not permitted under Wisconsin law.
¶ 20 The plain language of WIS. STAT. ch. 109, and the DWD rules related thereto, demonstrate the legislative intent to set certain minimum conditions of compensation (breaks of less than 30 minutes), to give employees the tools to enforce those requirements (DWD action and/or litigation), and to prevent an employer from insulating itself from liability by contracts with the employees or any other entity. Husco's defenses all arise out of its theory that the implication of the CBA is that it contracted away its liability to pay for breaks of less than 30 minutes. Accepting the legal theory underlying those defenses would require that we ignore the plain language of WIS. STAT. § 109.03(5). "We cannot ignore words in a statute to achieve a desired construction. Rather, a statute should be construed to give effect to its leading idea, and the entire statute should be brought into harmony with its purpose." State v. Okray Produce Co., 132 Wis.2d 145, 150, 389 N.W.2d 825 (Ct.App.1986), superseded on other grounds by State v. Marshland Acres, Inc., 2013 WI App 72, 348 Wis.2d 29, 832 N.W.2d 157 (internal citation omitted).
¶ 21 We conclude that because all of Husco's defenses implicate and depend on the provisions of the CBA, the defenses are preempted by § 301 of the LMRA.
¶ 22 For all the foregoing reasons, summary judgment in favor of the employees and against Husco should have been granted.
¶ 23 As stated, Husco sought summary judgment on its claims against District 10. District 10 reciprocated, seeking dismissal of all of Husco's claims. As we have explained above, claims that depend on an interpretation of the CBA are preempted by federal law. We will not repeat the analysis again here.
¶ 24 Husco's summary judgment motion against District 10 alleges: (1) breach of the contractual duty of good faith and fair dealing; (2) unjust enrichment; and (3) promissory estoppel. These are substantially the same arguments Husco raised as defenses against the employees' motion. We address each claim related to District 10.
¶ 25 Husco argues that District 10 violated its contractual good faith and fair dealing obligation when it: (1) refused to seek a waiver from the DWD; (2) filed a complaint with the DWD seeking wages for the unpaid breaks; and (3) initiated a class action lawsuit.
¶ 26 At the motion hearing on the multiple summary judgment motions, Husco acknowledged that its breach of contract claims arise out of § 301 of the LMRA. Specifically, counsel for Husco stated: "With respect to the breach of contract claim, it's not an issue. Section 301 is where the breach of contract claim arises.... There's no need to address
¶ 27 To recover on a claim for unjust enrichment, a claimant must prove the following three elements: (1) the claimants conferred a benefit upon the other party; (2) the other party had an appreciation or knowledge of the benefit; and (3) the other party accepted or retained the benefit under circumstances that would make it inequitable for the other party to retain the benefit without payment of its value. Ludyjan v. Continental Cas. Co., 2008 WI App 41, ¶ 7, 308 Wis.2d 398, 747 N.W.2d 745.
¶ 28 Husco contends that District 10 will be unjustly enriched if its members are allowed to retain "the benefits they have already received by agreeing to 20 minute, unpaid breaks and to now also receive wages for those same breaks." (Emphasis in Husco's brief to this court.) How District 10 was enriched by something Husco gave its employees is not explained. How District 10 would be unjustly enriched by the employees' wage recovery is likewise not explained. The failure to state a claim for unjust enrichment against District 10 required dismissal of that claim on summary judgment.
¶ 29 "Promissory estoppel has three elements: (1) the promise was one for which the promisor should reasonably expect to induce action or forbearance of a definite and substantial character on the part of the promisee; (2) the promise did induce such action or forbearance; and (3) injustice can be avoided only by enforcement of the promise." Champine v. Milwaukee Cnty., 2005 WI App 75, ¶ 21, 280 Wis.2d 603, 696 N.W.2d 245.
¶ 30 Husco contends that "[t]his is a case that would call out for the application of promissory estoppel if the unpaid break provision is held to be contractually unenforceable." Husco argues that "District 10 unquestionably promised that the breaks its members would receive would be unpaid. Similarly, there is no dispute that HUSCO relied on that promise by giving those members additional monetary benefits in their contracts for approximately 25 years." (Emphasis in Husco's brief.) Husco's argument is a concession that any promise by District 10 arose out of the CBA. As such, it is preempted by federal law.
¶ 31 This claim is also barred by Wisconsin law. Husco contends that it is not asserting a claim for contribution against District 10, however its arguments suggest that Husco may be seeing indemnification from District 10. To the extent Husco does assert a claim for contribution, we conclude that indemnification or contribution to unpaid wages by a union is not part of the labor-management regulatory scheme of Wisconsin law. Here, as in Northwest Airlines, the collective bargaining agreement included provisions that, unbeknownst to the parties, violated Wisconsin law.
¶ 32 WISCONSIN STAT. ch. 109 is designed to protect employees by providing for the reasonably prompt payment of wages.
¶ 33 For all the reasons described above, the circuit court order denying summary judgment to all parties is reversed. Summary judgment is ordered in favor of the employees and Husco's affirmative defenses are dismissed. Summary judgment is ordered dismissing Husco's claims against District 10. The case is remanded for further proceedings consistent with this opinion.
Order reversed and cause remanded.
All references to the Wisconsin Statutes are to the 2011-12 version unless otherwise noted.
With exceptions not material here WIS. STAT. § 227.01(13) provides that "`[r]ule' means a regulation, standard, statement of policy, or general order of general application which has the effect of law and which is issued by an agency to implement, interpret, or make specific legislation enforced or administered by the agency or to govern the organization or procedure of the agency."