Butler v. Fidelity Technologies Corp.

685 So. 2d 676, 96 La.App. 3 Cir. 821, 1996 La. App. LEXIS 3057, 1996 WL 734593
CourtLouisiana Court of Appeal
DecidedDecember 26, 1996
Docket96-821
StatusPublished
Cited by2 cases

This text of 685 So. 2d 676 (Butler v. Fidelity Technologies Corp.) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Butler v. Fidelity Technologies Corp., 685 So. 2d 676, 96 La.App. 3 Cir. 821, 1996 La. App. LEXIS 3057, 1996 WL 734593 (La. Ct. App. 1996).

Opinion

685 So.2d 676 (1996)

Lonnie B. BUTLER, et al., Plaintiffs-Appellants,
v.
FIDELITY TECHNOLOGIES CORPORATION, Defendant-Appellee.

No. 96-821.

Court of Appeal of Louisiana, Third Circuit.

December 26, 1996.

*677 Robert Joseph Tete, Lake Charles, for Lonnie B. Butler.

James Robinson Madison, Shreveport, for Fidelity Technologies Corp.

Before THIBODEAUX, PETERS, and GREMILLION, JJ.

GREMILLION, Judge.

The plaintiffs, former employees of the defendant, Fidelity Technologies Corporation, appeal the trial court's judgment sustaining Fidelity's exception of lack of subject matter jurisdiction. For the following reasons, we reverse and remand this matter to the trial court for further proceedings.

FACTS

On March 1, 1991, Fidelity entered into a contract with the Seventh Signal Command of the United States Army to provide operation and maintenance services for the administrative telephone system at Ft. Polk, Louisiana. Because the subject matter of the contract is the provision of services to the Federal Government, it is governed by the mandates of the Service Contract Labor Standards Act (SCA), 41 U.S.C. § 351, which ensures that service employees working on government contracts are paid the prevailing wages paid in the locality by non-governmental contractors. The wage and benefit determinations are made by the Department of Labor under the direction of the Secretary of Labor by surveying the wages for similar jobs in the locality. Fidelity provided the operation and maintenance services from April 1, 1991 until November 4, 1992, when Fidelity novated the contract to Dynamic Concepts, Incorporated (DCI), who then succeeded to all of Fidelity's duties and responsibilities under the contract.

At the time of the novation, the plaintiffs were employees of Fidelity. On November 4, 1992, the date DCI assumed all of Fidelity's responsibilities, they became employees of DCI and on November 5, 1994, they were promptly discharged. At this time, the plaintiffs had accrued unused vacation days and they made timely demand to be paid all wages and benefits due. However, a dispute arose over whom, Fidelity or DCI, was responsible for payment of this vacation time. Fidelity and DCI were unable to negotiate a resolution to this dispute and thereafter submitted their dispute to the United States Department of Labor, Wage and Hour Division, for resolution as required by the SCA. On January 6, 1993, the plaintiffs requested intervention by the Department of Labor in this dispute. The plaintiffs allege that they never received a response to this request.

On December 4, 1994, the plaintiffs instituted the present litigation against Fidelity pursuant to La.R.S 23:631 and 632. La.R.S. 23:631 provides that upon discharge, the employer has the duty to pay the employee the amount of the wages due under the terms of employment within three days of the discharge. Failure to pay or tender payment subjects the employer to liability in the amount of either ninety days wages at the employee's daily rate or full wages from the time of demand until the employer pays or tenders payment, whichever is the lesser amount. La.R.S. 23:632. In addition, reasonable attorney fees are available to the employee in the event it is necessary to file suit to collect the unpaid wages. Id.

*678 On March 14, 1995, Fidelity filed an exception to subject matter jurisdiction alleging that because the contract between it and the Seventh Signal Command incorporated the SCA, state law is preempted and the exclusive remedy available to the plaintiffs is administrative relief through the United States Department of Labor. The hearing on this motion was held on February 23, 1996, wherein the trial court sustained the exception finding that the SCA preempted state law.

ASSIGNMENT OF ERROR

The plaintiffs have appealed alleging that the trial court erred in holding that the Service Contract Act of 1965 preempts a state law claim arising out of an employer's failure to pay its employees all amounts due within seventy-two hours of termination.

PREEMPTION

The United States Supreme Court clearly set forth the standard for federal preemption under the Supremacy Clause of the United States Constitution in Cipollone v. Liggett Group, Inc., 505 U.S. 504, 516, 112 S.Ct. 2608, 2617, 120 L.Ed.2d 407 (1992):

Article VI of the Constitution provides that the laws of the United States "shall be the supreme Law of the Land; ... any Thing in the Constitution or Laws of any state to the Contrary notwithstanding." Thus, since our decision in M'Culloch v. Maryland, 17 U.S. (4 Wheat.) 316, 427, 4 L.Ed. 579 (1819), it has been settled that state law that conflicts with federal law is "without effect." Consideration of issues arising under the Supremacy Clause "start[s] with the assumption that the historic police powers of the States [are] not to be superseded by ... Federal Act unless that [is] the clear and manifest purpose of Congress." Accordingly, "`[t]he purpose of Congress is the ultimate touchstone' " of preemption analysis.
Congress' intent may be "explicitly stated in the statute's language or implicitly contained in its structure and purpose." In the absence of an express congressional command, state law is pre-empted if that law actually conflicts with federal law, or if federal law so thoroughly occupies a legislative field "`as to make reasonable the inference that Congress left no room for the States to supplement it.'"

(citations omitted).

"Preemption is not to be presumed lightly. In fact, there is typically a presumption weighing against preemption to insure that neither the Congress nor the courts unintentionally or unnecessarily disturb the federal-state balance." Huntleigh Corp. v. Louisiana State Board of Private Security Examiners, 906 F.Supp. 357, 360 (M.D.La. 1995). The historic police powers of the states are not to be superseded by federal act unless it is the clear and manifest purpose of Congress. Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 67 S.Ct. 1146, 91 L.Ed. 1447 (1947). To determine whether a state statute is preempted by federal statute, the court must first determine the construction of the two statutes and then resolve the question of whether the state statute interferes with the accomplishment and execution of the full purposes and objectives of Congress. Tenneco, Inc. v. Sutton, 530 F.Supp. 411 (M.D.La.1981). "Thus, where a state and the Congress enact similar legislation, the Court must review the history and purpose of the federal regulation to determine whether the Congress intended to pre-empt the state legislation and regulate the area in question." Id. at 433, 434.

DISCUSSION

Fidelity argues that the courts do not have jurisdiction over this action because the plaintiffs' exclusive remedy for non-payment is the administrative remedy provided by the SCA and the regulations enacted pursuant to that Act. We disagree. The SCA does not explicitly nor implicitly address the issue of nonpayment.

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685 So. 2d 676, 96 La.App. 3 Cir. 821, 1996 La. App. LEXIS 3057, 1996 WL 734593, Counsel Stack Legal Research, https://law.counselstack.com/opinion/butler-v-fidelity-technologies-corp-lactapp-1996.