1. Federal Framework: Section 301 Complete Preemption
Section 301 of the Labor Management Relations Act places any claim “for violation of contracts” between an employer and a union in federal court. The Supreme Court applies a complete preemption analysis meaning that if the resolution of a state law claim depends upon the meaning of a collective bargaining agreement, then the application of state law is preempted, and federal labor law principles must be employed to resolve the dispute. Lingle v. Norge Division of Magic Chef, Inc., 486 U.S. 399 (1988). The Ninth Circuit refines the inquiry through a two-step test set out in Burnside v. Kiewit Pacific Corp., 491 F.3d 1053 (9th Cir. 2007):
- Does the right exist only because the agreement creates it? If yes, preemption applies.
- If the right is independent, must a court interpret a disputed clause to decide the claim? If so, then preemption still applies. Otherwise, the state claim proceeds.
In the Burnside v. Kiewit Pacific case, the Court determined the meal and rest break claims were not pre-empted by the LMRA because: 1) The right to be compensated for employer-mandated travel time is a right conferred by state law, independent of the CBAs; and 2) The matter could be resolved without interpreting the CBAs.
2. California’s Statutory Exemptions Require Equal or Greater Protection
California allows a union to bargain away certain statutory wage benefits only when the agreement gives employees protection that the Legislature considers at least equivalent.
Two statutes show how the rule works.
Labor Code § 514 – Wages, Daily Overtime.
Agreement must (a) spell out wages, hours, and working conditions, (b) pay a premium rate for all overtime hours, and (c) pay a regular hourly rate at least
Labor Code § 512(e)–(f) – Meal (and related rest) periods for construction, motion picture, commercial driving, security services, electrical, gas or local public electric utility employees. Agreement must provide meal period rules, final and binding arbitration of meal period disputes, premium rates for all overtime, and a regular hourly rate at least 30 percent above minimum wage.
If the equal or greater threshold is met, the statutory right simply does not apply. As such, Courts treat the claim as one that “exists only because the agreement creates it,” satisfying Step One of Burnside and triggering Section 301 preemption.
3. Practical Guidance for Litigators
For both sides.
- Remember that “equal or greater protection” is a policy floor, not an interpretive aid. If the floor is not met, the statutory right exists, and Step Two of the preemption test clarified in Burnside v. Kiewit determines preemption.
- Be prepared to litigate wage inflation. An agreement that satisfied the 30 percent rule three years ago may fail today as the minimum wage rises.
- Be prepared for claims that are outside the scope of the preemption, such as minimum wage claims.
4. Takeaways
- Section 301 moves a claim to federal court when a disputed contract term must be interpreted.
- California will exempt overtime and meal period claims only when the collective bargaining agreement provides compensation terms that are at least thirty percent richer than the statutory floor.
- The equal or greater protection rule can eliminate the state right altogether, making federal preemption nearly automatic.
- A waiver of any remaining statutory right to a judicial forum must be clear and unmistakable.
California continues to balance its strong wage protections with respect for collective bargaining. Understanding where the equal or greater protection threshold lies is often the decisive move in wage and hour cases involving union employees.