WOLFE V. ADKINS: WAGE PAYMENT AND COLLECTION ACT CLARIFIED IN FAVOR OF EMPLOYERS
Every employer and human resource professional with an interest in West Virginia needs to be aware of a recent decision from the West Virginia Supreme Court of Appeals concerning the Wage Payment and Collection Act, W. Va. § 21-5-1, et. seq. In Wolfe, et al. v. Adkins, et. al., Number 101476 (Sept. 29, 2011), the Court reversed and remanded the case to the Circuit Court of Cabell County, issuing a new syllabus point which provides clarity to a confusing area of law. Specifically, the issue was whether an employee is entitled to payment of unused, accumulated sick leave upon termination from employment. Under the WPCA, it has long been held by the Court that the WPCA itself does not define what fringe benefits are “wages” (and thus payable) but, rather, what constitutes wages are determined by the terms of the applicable employment policy.
This sounds simple when the terms of the employment are reduced to writing and expressly state that accumulated yet unused sick leave is not payable upon termination. But what happens when the employment terms are silent on this point? Unfortunately, in the early part of the last decade, the Court decided a series of convoluted cases which seemingly required the employer to expressly state that particular unused, accumulated leave would not be paid. In the absence of a written exclusion, the employer needed to show some level of knowledge by the employee that unused, accumulated leave would not be paid upon termination lest the unwitting employer be caught in the WPCA trap.
In Wolfe, an action brought by several correctional officers terminated when the Cabell County Jail closed, the Court recognized the inherent “burden” placed upon employers to “negate a fringe benefit never conferred in the first instance.” The Court held concisely that:
[w]here there is no provision in a written employment agreement, personnel handbook, personnel policy materials or employer documents granting employees payment for unused, accumulated sick leave upon termination from employment, the unused, accumulated sick leave, upon termination from employment is not a vested, nonforfeitable fringe benefit under the Wage Payment and Collection Act and is not payable to the employees.
The Court considered various documents containing the terms of the correctional officers’ employment, some of which were clearly provided to the officers and others of which the Court determined that the officers should have known about. Critically, in none of the documents were the employees affirmatively told that they would receive compensation for accumulated sick leave upon termination. Rather, when a written term did relate to sick leave and the use thereof, the term limited the use of leave to “bona fide personal illness absences.” Regardless of the actual written terms, the Court did find persuasive that the trial testimony revealed that no employee of the County had been ever been paid sick leave upon termination. In conclusion, the Court remanded the matter to the Circuit Court with instructions for entry of a judgment as a matter of law in favor of the County.