Brandon Gay v. Pacific Steel Group

• Court: District Court, N.D. California
• Decided: June 15, 2021
• Docket: 4:20-cv-08442
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 BRANDON GAY, Case No. 20-cv-08442-HSG

8 Plaintiff, ORDER DENYING MOTION TO REMAND 9 v. Re: Dkt. No. 17 10 PACIFIC STEEL GROUP, 11 Defendant.

12 13 Plaintiffs Brandon Gay and Israel Berber filed this putative wage-and-hour class action in 14 California state court. Dkt. No. 1. Defendant removed the action to federal court based on federal 15 preemption under § 301 of the Labor Management Relations Act of 1974 (“LMRA”), 29 U.S.C. § 16 185. Id. Plaintiffs now seek to remand the action back to state court. Dkt. No. 17 (“Mot.”). For 17 the following reasons, the Court DENIES the motion to remand. 18 I. LEGAL STANDARD 19 “Except as otherwise expressly provided by Act of Congress, any civil action brought in a 20 State court of which the district courts of the United States have original jurisdiction, may be 21 removed” to federal court. 28 U.S.C. § 1441(a). 22 Under § 301 of the LMRA, “[s]uits for violation of contracts between an employer and a 23 labor organization . . . may be brought in any district court of the United States.” 29 U.S.C. § 24 185(a). As reaffirmed by the Ninth Circuit, the Supreme Court has interpreted the LMRA to 25 authorize federal courts “to create a uniform body of federal common law to adjudicate disputes 26 that arise out of labor contracts.” Curtis v. Irwin Indus., Inc., 913 F.3d 1146, 1155 (9th Cir. 27 2019) (citations omitted). “A state rule that purports to define the meaning or scope of a term in a 1 Corp. v. Lueck, 471 U.S. 202, 210 (1985)). Although federal preemption is a defense that does not 2 generally authorize removal to federal court, the Supreme Court has held that § 301 has such 3 “extraordinary pre-emptive power” that it “converts an ordinary state common law complaint into 4 one stating a federal claim for purposes of the well-pleaded complaint rule.” Metro. Life Ins. v. 5 Taylor, 481 U.S. 58, 65 (1987). 6 However, § 301 “cannot be read broadly to pre-empt nonnegotiable rights conferred on 7 individual employees as a matter of state law.” Curtis, 913 F.3d at 1152 (quoting Livadas v. 8 Bradshaw, 512 U.S. 107, 123 (1994)). Further, “not every dispute concerning employment, or 9 tangentially involving a provision of a collective-bargaining agreement, is preempted by § 301 or 10 other provisions of federal labor law.” McCray v. Marriott Hotel Servs., Inc., 902 F.3d 1005, 11 1009 (9th Cir. 2018) (quoting Lueck, 471 U.S. at 211). Claims which have no relationship to a 12 collective-bargaining agreement “beyond the fact that they are asserted by an individual covered 13 by such an agreement are simply not pre-empted by § 301.” Id. (citation and quotations omitted). 14 The Ninth Circuit has employed a two-step test to ensure that § 301 preemption “extends 15 only as far as necessary to protect the role of labor arbitration in resolving CBA disputes.” Curtis, 16 913 F.3d at 1153 (citation and quotations omitted). First, the court asks whether the asserted cause 17 of action involves a “right [that] exists solely as a result of the CBA.” Burnside v. Kiewit Pac. 18 Corp., 491 F.3d 1053, 1059 (9th Cir. 2007). “If the right exists solely as a result of the CBA, then 19 the claim is preempted, and our analysis ends there.” Id. (citing Lueck, 471 U.S. at 210). If not, 20 the court proceeds to the second step and asks “‘whether a plaintiff’s state law right is 21 substantially dependent on analysis of [the CBA],’ which turns on whether the claim cannot be 22 resolved by simply ‘look[ing] to’ versus ‘interpreting’ the CBA.” Curtis, 913 F.3d at 23 1153 (citations and quotations omitted and alterations in original). Interpretation is construed 24 narrowly in this context. Id. If claims are dependent on interpretation of the CBA, then the claim 25 is preempted by § 301; if not, the claim may proceed under state law. Burnside, 491 F.3d at 1059– 26 60. 27 II. DISCUSSION 1 Labor Code §§ 510 and 1198); (2) unpaid meal period premiums (violation of California Labor 2 Code §§ 226.7 and 512(a)); (3) unpaid rest period premiums (violation of California Labor Code § 3 226.7); (4) unpaid minimum wages (violation of California Labor Code §§ 1194, 1197, and 4 1197.1); (5) final wages not timely paid (violation of California Labor Code §§ 201 and 202); (6) 5 wages not timely paid during employment (violation of California Labor Code § 204); (7) non- 6 compliant wage statements (violation of California Labor Code § 226(a)); (8) failure to keep 7 requisite payroll records (violation of California Labor Code § 1174(d)); (9) unreimbursed 8 business expenses (violation of California Labor Code §§ 2800 and 2802); and (10) violation of 9 California Business & Professions Code §§ 17200 et seq. Dkt. No. 1 at ECF 13. 10 Plaintiffs initially argued that the case should be remanded because Defendant failed to 11 “provide any evidence of Plaintiffs’ or the putative class members’ membership in a union.” Mot. 12 at 4. In the declaration attached to its opposition, Defendant provided extensive excerpts from the 13 collective bargaining agreement (“CBA”) that it argues governed the employment relationship 14 with Plaintiffs as well as reports which show Plaintiffs as active members of the relevant union. 15 Dkt. No. 18-1. In their reply, Plaintiffs appear to have abandoned their argument that Defendant 16 failed to provide evidence of the CBA. See Dkt. No. 19 (“Reply”).1 In any event, Plaintiffs do not 17 dispute the existence of the CBA, and it does not appear that they could do so in good faith. 18 In opposing remand, Defendant refers to the provisions of the CBA that govern wages, 19 overtime wages, meal periods, rest periods, reimbursement of certain employee expenses, and 20 dispute resolution. Dkt. No. 18 (“Opp.”) at 3-4. Defendant argues that the Court cannot 21 adjudicate Plaintiffs’ claims without interpreting several separate provisions of the CBA, such that 22 Plaintiffs’ claims are preempted. Id. at 7. The Court agrees. 23 First, the Court notes that it will be required to determine whether the Plaintiffs’ claims are 24 exempted from the relevant California overtime, meal period, and rest period statutory 25 26 1 While Plaintiffs filed a series of evidentiary objections to the declaration in a separate document, Dkt. No. 19-1, it is unclear to the Court what purpose these objections serve at this point in the 27 litigation. Further, the Local Rules direct parties to include evidentiary or procedural objections to 1 requirements because of the CBA. For example, to determine whether Plaintiffs’ meal period 2 claims are exempted from the statutory meal period requirements, the California Labor Code 3 requires the Court to consider the extent of the CBA’s meal period provisions. See Cal. Lab. Code 4 § 512(e).2 Similarly, with regard to Plaintiffs’ overtime claims under California Labor Code §510, 5 the Court will need to consider whether the CBA’s overtime provisions exempt Plaintiffs’ claims 6 under California Labor Code § 514.3 7 Defendant argues that the relevant provisions of the CBA provide for the wages, hours of 8 work, working conditions of employees, and expressly provide for meal periods for those 9 employees4 and for premium overtime wages and wages of at least 30 percent more than the state 10 2 Cal. Lab. Code § 512(e) provides: 11

Subdivisions (a) and (b) do not apply to an employee specified in 12 subdivision (f) if both of the following conditions are satisfied:

13 (1) The employee is covered by a valid collective bargaining agreement. 14

(2) The valid collective bargaining agreement expressly provides for 15 the wages, hours of work, and working conditions of employees, and expressly provides for meal periods for those employees, final and 16 binding arbitration of disputes concerning application of its meal period provisions, premium wage rates for all overtime hours worked, 17 and a regular hourly rate of pay of not less than 30 percent more than the state minimum wage rate. 18

19 3 Cal. Lab. Code § 514 provides: 20 Sections 510 and 511 do not apply to an employee covered by a valid collective bargaining agreement if the agreement expressly provides 21 for the wages, hours of work, and working conditions of the employees, and if the agreement provides premium wage rates for all 22 overtime hours worked and a regular hourly rate of pay for those employees of not less than 30 percent more than the state minimum 23 wage.

24 4 The meal break provision of the CBA provides:

25 B-1 - If workmen are required to work continuously for more than four and one-half (4½) hours or five (5) hours when the normal 26 starting time is established before 8:00 a.m. without an opportunity for lunch during the period of a normal shift, they shall receive 27 overtime pay for work after the four and one-half (4 ½ ) hours, (or 1 minimum wage.5 Opp. at 8. It does not appear that Plaintiffs dispute this position, which is well 2 supported by the excerpts of the CBA provided by Defendant. 3 Instead, Plaintiffs’ Reply focuses on the “final and binding arbitration of disputes” 4 requirement of § 512(e) and a similar requirement in Cal. Lab. Code § 226.7, which addresses rest 5 periods. Reply at 4-6. Plaintiffs argue that the CBA’s grievance procedure is insufficient to 6 establish that the CBA requires final and binding arbitration of disputes. Id. Plaintiffs’ argument 7 is self-defeating, since they are asking the Court to consider the CBA’s detailed grievance 8 procedure and find that, as a matter of law, the procedure does not provide for final and binding 9 arbitration of disputes. In other words, to adjudicate Plaintiffs’ argument, the Court will 10 necessarily have to interpret the scope and validity of the CBA’s grievance procedure provisions. 11 The necessity of such an analysis satisfies the preemption test’s standard of “an active dispute over 12 ‘the meaning of contract terms.’” See Curtis, 913 F.3d at 1153. It may be that Plaintiffs will 13 prove to be correct in their arguments about the applicability of the CBA’s grievance procedure 14 and the operation of the statutory exemptions, but the Court clearly cannot conduct that analysis 15 without resolving “questions about the scope, meaning, or application of the CBA.” Id. (“[A] state 16 law claim may avoid preemption if it does not raise questions about the scope, meaning, or 17 application of the CBA.”). Accordingly, the Court finds that the second prong of the § 301 18

19 the individual employer’s time. (Example: 6:00 a.m. starting time - 5 hours; 7:00 a.m. starting time – 5 hours; 8:00 a.m. starting time - 4 ½ 20 hours.)

21 Dkt. No. 18-1 at ECF 8-9. 5 Sections 6 and 7 of the CBA contain numerous provisions on wages including the following 22 provision on overtime:

23 Overtime - Time and one-half shall be paid for the first two (2) hours worked in excess of eight (8) hours on any regular work day Monday 24 through Friday. Time and one half shall be paid for the first eight (8) hours worked on Saturday and double time shall be paid for all hours 25 worked in excess of eight (8) hours. All other overtime worked, including Sundays and holidays, shall be paid at the double time rate. 26 Overtime pay shall be computed by not less than half-hour increments. No work shall be performed on Labor Day except to save 27 life and property. 1 preemption test is satisfied with respect to Plaintiffs’ overtime, meal period, and rest period 2 claims. 3 Plaintiffs’ remaining claims under California law arise from the same working conditions 4 and relationship with Defendant during the same period as Plaintiffs’ overtime, meal period, and 5 rest period claims. See Dkt. No. 1 at ECF 22-33. Therefore, the Court finds that the claims derive 6 from a “common nucleus of operative fact” and asserts supplemental jurisdiction over the 7 remaining claims. Kuba v. 1-A Agr. Ass'n, 387 F.3d 850, 855 (9th Cir. 2004) (“Nonfederal claims 8 are part of the same ‘case’ as federal claims when they derive from a common nucleus of 9 operative fact and are such that a plaintiff would ordinarily be expected to try them in one judicial 10 proceeding.” (citation and quotations omitted)). 11 III. CONCLUSION 12 Plaintiffs’ motion to remand is DENIED. The Court SETS a telephonic case management 13 conference for June 22, 2021 at 2:00 p.m. with a joint case management statement due on June 18, 14 2021. 15 This proceeding will be held by AT&T Conference Line. The court circulates the 16 following conference number to allow the equivalent of a public hearing by telephone. 17 For conference line information, see: https://apps.cand.uscourts.gov/telhrg/ 18 All counsel, members of the public and press please use the following dial-in information 19 below to access the conference line: 20 Dial In: 888-808-6929 21 Access Code: 6064255 22 The Court may be in session with proceedings in progress when you connect to the 23 conference line. Therefore, mute your phone if possible and wait for the Court to address you 24 before speaking on the line. For call clarity, parties shall NOT use speaker phone or earpieces for 25 these calls, and where at all possible, parties shall use landlines. The parties are further advised to 26 ensure that the Court can hear and understand them clearly before speaking at length. 27 PLEASE NOTE: Persons granted access to court proceedings held by telephone or 1 proceedings, including screenshots or other visual copying of a hearing, is absolutely prohibited. 2 || See General Order 58 at Paragraph IIL. 3 IT IS SO ORDERED. 4 || Dated: 6/15/2021 □ ° HAYWOOD S. GILLIAM, JR. 6 United States District Judge 7 8 9 10 11 12

© 15 16

= 17

Z 18 19 20 21 22 23 24 25 26 27 28