Employers should always look for a preemption defense when a FLSA suit is lodged against a unionized client. Clear proof of that was just given by the Ninth Circuit when that Court held that unionized offshore oil rig workers could not pursue overtime claims because the Labor Management Relations Act (LMRA) barred the suit. The case is entitled Curtis et al. v. Irwin Industries Inc. et al. and issued from the Court of Appeals for the Ninth Circuit.
The Court affirmed the lower court. The holdings were based on the fact that the labor contract satisfied the California overtime pay requirements. The Court found that “Curtis’s claim for overtime pay is preempted under § 301 of the Labor Management Relations Act because California overtime law does not apply to an employee working under a qualifying collective bargaining agreement, and Curtis worked under such an agreement…”
The workers did twenty-four hour shifts on offshore oil rigs. They worked twelve and were off for twelve but asserted that they could not leave the platform or otherwise use the time for their own pursuits. They were on the platforms for seven consecutive days. The workers worked under two separate labor agreements.
The Ninth Circuit noted that Section 301 meant that “nonnegotiable rights” under state law, i.e. minimum wage and overtime, were not always preempted, even if the parties had a labor contract. The Court stated that a two-step test should be utilized to determine if preemption was appropriate.
The first prong of the test is to determine if the controversy concerned a right inuring to the employees only because of its presence in the labor contract. That would be sufficient to find that preemption was appropriate. If a court determined the controversy involved a right established under state law, then the court would inquire whether any provision(s) of the labor contract had to be interpreted for the claim to be resolved and if such an analysis was necessary, then the matter was also preempted. The Court found that “because Curtis’s right to overtime ‘exists solely as a result of the CBA,’ his claim that Irwin violated overtime requirements by not paying him for the 12 off-duty hours is preempted under § 301.”
Whenever there is a labor contract involved, try to find some connection between provisions in that contract and the purported overtime or other claim. Stress that contractual interpretation is required to resolve the dispute, so it is an arbitral issue, rather than a statutory one. Or violation.
It’s certainly worth a try…