In a case of statutory interpretation, the California Court of Appeal in Hirdman v. Charter Communications, LLC recently affirmed a win for the employer, holding that outside sales employees can be paid as “exempt employees” under California’s sick leave statute.

Plaintiff Hirdman worked for Charter Communications (the “Company” or “Charter”) as a sales representative. After his employment with the Company ended, Plaintiff Hirdman sued the Company for civil penalties under PAGA for various alleged violations of the Labor Code, including the failure to properly calculate his sick time pay.

During his employment, the Company classified Hirdman as an outside salesperson, making him exempt from overtime. He alleged that the Company improperly classified him as “exempt” for purposes of his sick pay, and thus calculated his sick pay incorrectly by excluding his commissions.

Labor Code Section 246 provides multiple methods of calculations for sick time pay—depending on whether the employee is exempt or non-exempt. Under the statute, the employer is required to pay exempt employees in the same manner it pays them for all other paid leaves. In this instance, Charter paid Hirdman’s sick time at his base rate of pay and did not factor in commissions.

To resolve the issue, the California Court of Appeal analyzed the statutory language and its framework. The Court homed in on the fact that the legislature chose not to limit the reach of “exempt employee” in the statute when it very...

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