Loves v. World Ins. Co. -- supplemental opinion

D orothy M. L oves , appeLLant, v. WorLD I nsurance coMpany,
a nebraska corporatIon, appeLLee .
773 N.W.2d 348
Filed March 13, 2009. 	No. S-07-1067.
suppLeMentaL opInIon
Appeal from the District Court for Douglas County: J ohn D.
hartIgan , J r ., Judge. Supplemental opinion: Former opinion
modified. Motion for rehearing overruled.
Steven J. Riekes and Howard N. Epstein, of Marks, Clare &
Richards, L.L.C., for appellant.
Mary Kay O’Connor and Pamela Epp Olsen, of Cline,
Williams, Wright, Johnson & Oldfather, L.L.P., for appellee.
heavIcan, c.J., connoLLy, gerrarD, stephan, MccorMack ,
and MILLer-L erMan, JJ.
per curIaM.
Case No. S-07-1067 is before this court on the motion for
rehearing of appellant Dorothy M. Loves regarding our opinion
reported at Loves v. World Ins. Co., 276 Neb. 936, 758 N.W.2d
640 (2008). We overrule the motion but for purposes of clarifi-
cation modify the opinion as follows:
In the portion of the opinion designated “ANALYSIS,” we
withdraw the first through the third paragraphs, id. at 939-41,
758 N.W.2d at 643-44, and substitute the following paragraphs
in their place:
The NWPCA requires an employer to pay “unpaid
wages” to an employee who separates from the payroll
“on the next regular payday or within two weeks of the
date of termination, whichever is sooner.”8 A sick leave
plan is considered a fringe benefit under the NWPCA. At
the time Loves retired from World, in 2003, the NWPCA
defined “wages” as “compensation for labor or services
rendered by an employee, including fringe benefits, when
previously agreed to and conditions stipulated have been
8 § 48-1230.
LOvES v. WORLD INS. CO. 	359
Cite as 277 Neb. 359
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met by the employee, whether the amount is determined
on a time, task, fee, commission, or other basis.”9 The
NWPCA was subsequently amended to include the fol-
lowing provision: “Paid leave, other than earned but
unused vacation leave, provided as a fringe benefit by the
employer shall not be included in the wages due and pay-
able at the time of separation, unless the employer and the
employee or the employer and the collective-bargaining
representative have specifically agreed otherwise.”10 This
amended language was in effect at the time of the district
court’s disposition of the case in 2007.
When applying § 48-1229, we have consistently held
that a payment will be considered a wage subject to the
NWPCA if (1) it is compensation for labor or services,
(2) it was previously agreed to, and (3) all the conditions
stipulated have been met.11
[5] In the absence of a statutory indication to the con-
trary, words in a statute will be given their ordinary mean-
ing.12 Under the plain language of either § 48-1229(4)
(Reissue 2004) or § 48-1229(4) (Cum. Supp. 2008), no
fringe benefit, including sick leave, is payable to a sepa-
rating employee unless it was previously agreed to and all
the conditions stipulated have been met.
Unlike the employee handbook in Professional Bus.
Servs. v. Rosno,13 which provided, “‘Any sick leave not
used will be paid to the employee at the time of termi-
nation,’” it is undisputed in this case that at the time
9 § 48-1229(4) (Reissue 2004).
10 § 48-1229(4) (Cum. Supp. 2008).
11 Pick v. Norfolk Anesthesia, ante p. 511, 755 N.W.2d 382 (2008); Roseland
v. Strategic Staff Mgmt., supra note 2; Hawkins v. City of Omaha, 261 Neb.
943, 627 N.W.2d 118 (2001); Moore v. Eggers Consulting Co., 252 Neb.
396, 562 N.W.2d 534 (1997); Knutson v. Snyder Industries, Inc., 231 Neb.
374, 436 N.W.2d 496 (1989).
12 McClellan v. Board of Equal. of Douglas Cty., 275 Neb. 581, 748 N.W.2d
66 (2008).
13 Professional Bus. Servs. v. Rosno, 268 Neb. 99, 115, 680 N.W.2d 176, 188
(2004).
360 	277 NEbRASKA REPORTS

of Loves’ retirement, the World policy did not permit
employees to cash out their earned but unused sick leave.
When Loves retired, World’s employee handbook pro-
vided that sick leave could be used “for employee illness
or that of a dependent child” and that “[u]nused sick time
cannot be carried over but will be placed in an emer-
gency reserve account to be used for extended periods
of illnesses, greater than 3 days, or disability.” It also
provided that “[u]nused personal and sick time can not be
cashed in at time of termination. Any unused balance will
be forfeited.”
[6] Under either version of § 48-1229(4), the one in
effect at the time of Loves’ retirement or the one in effect
at the time of the district court’s disposition, accrued but
unused sick leave may be treated differently than accrued
but unused vacation leave for purposes of determining
unpaid wages when employment ends, because the stipu-
lated conditions for each type of leave may differ. Other
courts have recognized an employer’s right to treat sick
leave as a “contingent benefit due only in the event an
employee misses work due to illness.”14 We conclude that
the NWPCA does not prohibit an employer from provid-
ing a sick leave benefit which may be used only in the
event of illness or injury and which has no monetary
value upon termination of employment if it is not so used.
In this case, the agreement of the parties at the time of
Loves’ retirement, as reflected in the employee handbook,
contemplated a benefit of this nature. Loves did not con-
tend that she was entitled to the value of sick leave based
on a qualifying illness or injury, and she did not present
any medical evidence to that effect.
The remainder of the opinion shall remain unmodified.
ForMer opInIon MoDIFIeD.
MotIon For rehearIng overruLeD.
W rIght, J., not participating.
14 Teamsters, Local 117 v. NW Beverages, 95 Wash. App. 767, 768, 976 P.2d
1262, 1263 (1999). See, also, Simpson v. City of Blanchard, 797 P.2d 346
(Okla. App. 1990).
LOvES v. WORLD INS. CO. 	361
Cite as 277 Neb. 359