Amicus Curiae Brief — Livadas v. Bradshaw

No. 92-1920 «MAN 4

—— De wo

ee a

Iu the Supreme Court of the United States

OCTOBER TERM, 1993

KAREN LIVADAS, PETITIONER

Vv.

LLOYD AUBRY,

CALIFORNIA LABOR COMMISSIONER

ON WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

BRIEF FOR THE UNITED STATES

AS AMICUS CURIAE SUPPORTING PETITIONER

Drew S. Days, III

Solicitor General

DANIEL SILVERMAN LAWRENCE G. WALLACE

Acting General Counsel Deputy Solicitor General

LINDA SHER Amy L. WAX

Acting Associate General Assistant to the Solicitor

Counsel General

NORTON J. COME Department of Justice

Deputy Associate Washington, D.C. 20530

General Counsel (202) 514-2217

National Labor

Relations Board

Washington, D.C. 20570

QUESTION PRESENTED

Whether petitioner may sue the California Labor

Commissioner for injunctive relief and damages

under 42 U.S.C. 1983, for refusing to prosecute her

state wage-and-hour claim on the basis of her status

as an employee covered by a collective bargaining

agreement containing an arbitration clause.

(1)

a

TABLE OF CONTENTS

Page

Interest of the United States 20200... .ccccccccccecceceeceneeeees 1

ELL 2

ee 10

Argument:

LE

Petitioner is entitled to relief under 42 U.S.C. 1983

for respondent’s interference with her right to bar-

gain collectively under Section 7 of the NLRA by

refusing to enforce her state wage claim ................ 13

A. Respondent’s practice of refusing to enforce

state wage claims such as petitioner’s is not re-

quired by principles of federal labor law pre-

emption and interferes with employees’ rights

to bargain collectively ........................-c.c0...c..0000.-.-- 16

1. Enforcement of petitioner’s claim is not pre-

empted by Section 301 of the LMRA ............ 16

2. Respondent’s refusal to enforce petitioner’s

wage claim interferes with the exercise of

her rights under Section 7 of the NLRA re-

gardless of whether it results from an “er-

roneous” or overly broad application of state

B. Petitioner has a cause of action under 42 U.S.C.

1983 for respondent’s refusal to enforce her

wage claim under state law .............00000.00.0....

oS &

TABLE OF AUTHORITIES

Cases:

Adickes Vv. S.H. Kress & Co., 398 U.S. 144 (1970). 28

Allis-Chalmers Corp. v. Lueck, 471 U.S. 202

ESS SI 6, 11, 16, 17, 19

Brown V. Hotel Employees, 468 U.S. 491 (1984) .... 10, 13,

14, 15

Building & Constr. Trades Council Vv. Associated

Builders & Contractors of Massachusetts /Rhode

Island, Inc., 113 S. Ct. 1190 (1998) 15

(II)

IV

Cases—Continued: Page

Damico Vv. California, 389 U.S. 416 (1967) ............. 27-28

Franchise Tax Board v. Construction Laborers

Vacation Trust, 463 U.S. 1 (1983) ...........----....... 26

Golden State Transit Corp. v. City of Los Angeles:

I LE Re 5, 15

498 U.S. 108 (1989) .................... 5, 10, 12, 18, 14, 15, 25

Hill v. Florida, 325 U.S. 538 (1945)... 10, 13

Houghton v. Shafer, 392 U.S. 689 (1968) 28

Lingle v. Norge Div. of Magic Chef, Inc., 486 U.S.

Xf ES 6, 11, 16, 17, 18, 19, 20, 21, 26

Local 174, Teamsters v. Lucas Flour Co., 369 U.S.

eee ee eee ee 20

Lodge 76, Int'l Ass’n of Machinists Vv. Wisconsin

Employment Relations Comm’n, 427 U.S. 132

Se ed : 15

McNeese V. Board of Educ., 373 U.S. 668 (1963).. 12, 27

Metropolitan Life Ins. Co. Vv. Massachusetts, 471

OT ee 15

Monell v. Department of Social Services, 436 U.S.

FO eee 28

Monroe V. Pape, 365 U.S. 167 (1961)... 28

Nash Vv. Florida Industrial Comm’n, 389 U.S. 235

0 SRE Se ee eee 10, 12, 13, 14, 24

Phillips v. Martin Marietta Corp., 400 U.S. 542

ITT icsicieieenerinlaterenieactuiastasiadaanbiadaiataanii kiana aiec tenia 23

Plumbing, Heating & Piping Employers Council

Vv. Howard, 126 Cal. Rptr. 406 (Cal. Ct. App.

Ee 6, 18

Rum Creek Coal Sales, Inc. v. Caperton, 971 F.2d

TS Ce 25

San Diego Building Trades Council v. Garmon,

I I 26

United Steelworkers v. Johnson, 830 F.2d 924

I 24, 25

Constitution and statutes:

U.S. Const. Art. VI, Cl. 2 (Supremacy Clause)... 2, 10,

18, 14

Civil Rights Act of 1964, Tit. VII, 42 U.S.C. 2000e

GF GE eecetcnencnnctaemncienenttcnsrentintintateenbinengtenatitilimaniints 23

Statutes—Continued: Page

Labor-Management Relations Act, 1947, 29 U.S.C.

141 et seq.: oo

Ae passim

National Labor Relations Act, 29 J.S.C. 151 et

i cicinisientailiiiesininncinntniiininsianinsisintesiitatiiisiinaiigiiiamsmmmmentiens 1,5

§ 7, 29 U.S.C. 157 .......... 10, 11, 12, 18, 15, 20, 23, 24, 27

§ 8(a) (1), 29 U.S.C. 158 (a) (1) 10, 13

EES ES ee passim

Cal. Lab. Code (West 1989) :

IT disci tihantancsiathi iadeniaiaindemaetittaingitalua ieee 3

EN eee 2, 3, 16

ERE e ene 3, 4, 7, 16, 17, 20

I ahaa te cae ia adie passim

Miscellaneous:

Individual Employment Rights Manual, 9A Lab.

Rel. Rep. (BNA) No. 60 (1990) —...00.. 22

Iu the Supreme Court of the United States

OCTOBER TERM, 1993

No. 92-1920

KAREN LIVADAS, PETITIONER

Vv.

LLOYD AUBRY,

CALIFORNIA LABOR COMMISSIONER

ON WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

BRIEF FOR THE UNITED STATES

AS AMICUS CURIAE SUPPORTING PETITIONER

INTEREST OF THE UNITED STATES

The court of appeals in this case (Pet. App. 7a)

acknowledged that the National Labor Relations Act

(NLRA), 29 U.S.C. 151 et seq., gives petitioner “a

right to engage in collective bargaining, and [42

U.S.C.] 1983 therefore provides a remedy for a

deprivation of that right.” The court held, however,

that respondent did not impermissibly interfere with

petitioner’s exercise of her rights under the NLRA by

refusing to prosecute her wage claim under the

California Labor Code on the basis of her status as an

employee covered by a collective bargaining agree-

ment containing an arbitration clause. Respondent’s

action was based on the legal conclusion that petition-

(1)

2

er’s claim was preempted under Section 301 of the

Labor-Management Relations Act (LMRA), 29 U.S.C.

185.

The court of appeals’ decision misapplies the doc-

trine of federal labor law preemption under Section

301 of the LMRA, as articulated in decisions of this

Court. It is also inconsistent with decisions of the

Court holding that state action that impairs rights

protected by the NLRA is preempted by direct opera-

tion of the Supremacy Clause. The United States,

and the National Labor Relations Board in particu-

lar, have an important interest in ensuring that States

do not discriminate against employees who exercise

their rights under the NLRA, and that States enforce

their laws in a manner consistent wtih NLRA and

Section 301 preemption principles. At the Court’s in-

vitation, the United States filed a brief amicus curiae

at the petition stage of this case.

STATEMENT

1. On January 2, 1990, petitioner, a union-

represented employee covered by a collective bargain-

ing agreement, was discharged from her position as a

clerk at a Safeway store in Napa County, Cali-

fornia.’ On that date, she requested payment of all

wages due her. The store manager refused, telling

petitioner that he would mail her a check instead.

Petitioner received that check three days later, on

January 5. Pet. App. 2a.

Petitioner believed that Safeway’s three-day delay

in payment violated California law. Section 201 of

the California Labor Code provides: “If an employer

1 Petitioner was represented by Local 373, United Food and

Commercial Workers, AFL-CIO. Pet. App. 24a.

3

discharges an employee, the wages earned and un-

paid at the time of discharge are due and payable

immediately.” Cal. Lab. Code § 201 (West 1989).

Section 203 provides: “If an employer willfully fails

to pay * * * in accordance with Section[] 201 * * *

any wages of an employee who is discharged or who

quits, the wages of such employees shall continue

as a penalty from the due date thereof at the same

rate until paid.” Cal. Lab. Code § 203 (West 1989).

On January 9, petitioner filed a claim with the

California Division of Labor Standards Enforcement

(DLSE) seeking a penalty payment from Safeway

pursuant to Section 203. Pet. App. 2a-3a.

Respondent is the California Labor Commissioner

and head of DLSE. He is authorized by Section

98.3(a) of the California Labor Code to prosecute

actions to collect penalties on behalf of individuals

who are “financially unable to employ counsel and

* * * have claims which are valid and enforceable”

under the California Labor Code. Cal. Lab. Code

§ 98.3(a) (West 1989). Pet. App. 3a. On February

7, 1990, DLSE sent petitioner a letter declining to

prosecute her claim. /bid. The letter stated (id. at

8a):

It is our understanding that the employees

working for Safeway are covered by a collective

bargaining agreement which contains an arbitra-

tion clause. The provisions of Labor Code Sec-

tion 229 preclude this Division from adjudicating

any dispute concerning the interpretation or ap-

plication of any collective bargaining agreement

containing an arbitration clause. [*]

* Cal. Lab. Code § 229 (West 1989) states (Pet. 3):

Actions to enforce the provisions of this article for the

collection of due and unpaid wages claimed by an individ-

ual may be maintained without regard to the existence of

4

Labor Code Section 203 requires that the

wages continue at the “same rate” until paid. In

order to establish what the “same rate” was, it

is necessary to look to the collective bargaining

agreement and “apply” that agreement. The

courts have pointed out that such an application

is exactly what the provisions of Labor Code

Section 229 prohibit.

2.a. On February 16, 1990, petitioner filed an

action in federal district court against respondent

in his official capacity as Labor Commissioner under

42 U.S.C. 1983, seeking injunctive and declaratory

relief and damages based on respondent’s refusal to

prosecute petitioner’s claim against Safeway for the

penalty prescribed by Section 203 of the California

Labor Code. Pet. App. 3a. As described by the dis-

trict court (id. at 24a-25a), the complaint alleged

that DLSE maintains “[an] agency policy of dis-

crimination in the enforcement of the California

Wage and Hour Law against employees who work

under collective bargaining agreements which have

arbitration clauses.” That policy, petitioner alleged,

“denied her access to the investigatory, prosecutorial,

and remedial resources provided under [the] Cali-

fornia Labor Code * * * for the sole reason that she

is an employee” covered by such an agreement. /d.

at 25a. DLSE’s policy entitles her to relief under

Section 1983, petitioner urged, since it denies her

benefits merely because she has engaged in federally

protected rights to “participat[e] in a labor union

and in collective bargaining.” /bid.

any private agreement to arbitrate. This section shall not

apply to claims involving any dispute concerning the

interpretation or application of any collective bargaining

agreement containing such an arbitration agreement.

5

Respondent admitted in the district court that

DLSE’s policy “is to enforce Labor Code [Sections]

201 and 203 for all employees except for those whose

work is governed by [collective bargaining agree-

ments] containing binding arbitration clauses.” Pet.

App. 25a. He defended DLSE’s policy on the ground

that it is required by federal labor law preemption

doctrine. Respondent explained that “[s]ince dam-

ages under [Section] 203 are determined in terms

of wages, which are established by the [collective

bargaining agreement], * * * enforcement of the

statute would entail interpretation of the [agree-

ment].” Jd. at 26a.

b. The district court granted summary judgment

for petitioner. Pet. App. 49a. Relying on this

Court’s decision in Golden State Transit Corp. v.

City of Los Angeles, 475 U.S. 608 (1986) (Golden

State I), the district court stated that a state or

local governmental policy that burdens or penalizes

employees’ exercise of rights granted by the National

Labor Relations Act (NLRA), 29 U.S.C. 151 et seq.,

is preempted by the NLRA. Moreover, under Golden

State Transit Corp. v. City of Los Angeles, 493 U.S.

103 (1989) (Golden State IT), an employee so affected

by such a policy may obtain injunctive relief and

damages from the governmental unit under Section

1983. Pet. App. 27a-32a. The district court con-

cluded that the NLRA affords petitioner the right

to negotiate, through her union, a collective bargain-

ing agreement containing an arbitration clause, and

that DLSE’s policy of granting benefits provided by

state law to all employees except those who work

under such a labor contract infringes upon that

federal right. Jd. at 32a-38a.

6

Finally, the district court rejected respondent’s

defense (reflected in DLSE’s February 7 letter to

petitioner) that DLSE was “preempted” from prose-

cuting petitioner’s claim by Section 229 of the Cali-

fornia Labor Code, as interpreted by the California

courts.* The district court held that preemption doc-

trine is a matter of federal, not state, law and that,

insofar as Section 229 is interpreted as going beyond

the requirements of federal preemption doctrine, it

is invalid. Pet. App. 39a-44a, 48a. Relying on Allis-

Chalmers Corp. v. Lueck, 471 U.S. 202 (1985), and

Lingle v. Norge Div. of Magic Chef, Inc., 486 U.S.

399 (1988), the district court concluded that peti-

tioner’s state-law claim for a penalty payment from

Safeway was not preempted by Section 301 of the

Labor-Management Relations Act (LMRA), 29 U.S.C.

185. The question whether Safeway violated state

law, the district court found, “can be determined

wholly independently from the [collective bargaining

agreement]. * * * It requires reference only to a

calendar, not to the [agreement], to determine that

the statute was violated and penalties are due.” Pet.

App. 41a.

Accordingly, the district court, inter alia, issued

an injunction requiring respondent te enforce Sec-

tions 201 and 203 “without discrimination based upon

a given claimant’s coverage under a_ collective-

In Plumbing, Heating & Piping Employers Council V.

Howard, 126 Cal. Rptr. 406 (Cal. Ct. App. 1975), discussed in

note 6, infra, the state appellate court addressed the question

whether Section 229 “precludes the Labor Commissioner from

hearing and enforcing a claim for collection of alleged due and

unpaid wages by an employee who belongs to a union which

has entered into a collective bargaining agreement which con-

tains an arbitration clause.” 126 Cal. Rptr. at 409.

7

bargaining agreement having an arbitration clause.”

Pet. App. 49a. It ordered respondent to institute an

action on petitioner’s behalf in the California courts

under Section 203, and to pay her the full value of

her wage claim in the event that the state courts

found her claim time-barred. J[bid.

3. A divided panel of the Ninth Circuit reversed.

The panel majority agreed with the district court that

petitioner has a right under the NLRA to engage in

collective bargaining and that she has a cause of

action under Section 1983 to obtain a remedy if the

State interferes with that right. Pet. App. 7a. The

majority held, however, that DLSE’s policy does not

‘“implicate[] [petitioner’s] federal rights at all.” Jd.

at 10a. The court understood Section 229, as inter-

preted by the state courts, “to preclude the adjudi-

eation of claims that would be preempted by federal

labor law.” Jd. at 9a. For respondent to so limit his

enforcement of Section 203 claims, the court con-

cluded, “is perfectly permissible under federal law.”

Id. at lla. The court further stated that, even if

respondent were mistaken in deciding that petition-

er’s claim is preempted by federal law (an issue

which the majority did not reach), he did not thereby

deprive her of rights under the NLRA. That is be-

cause respondent’s refusal to prosecute petitioner’s

claim amounted, at most, to a misapplication of Sec-

tion 229, and “fa] misinterpretation of a perfectly

valid state statute * * * does not provide grounds

for federal relief.” Jd. at 12a. Rather, the appro-

priate avenue of relief in these circumstances, the

court stated, is for petitioner to seek a writ of man-

date against respondent in the California courts.

Ibid.

8

The court of appeals concluded that “[t]o hold that

[petitioner] is entitled to federal relief in this case

would require us to hold that she is entitled under

the NLRA to a correct interpretation of California

law regarding enforcement of [Section] 203 claims.”

Pet. App. 12a. The court stated that Congress did

not intend the NLRA to confer any such entitlement

upon unionized employees. The court reasoned that

such an entitlement would “place employees who bar-

gain collectively in a better position than those who

do not because it gives them an extra avenue of re-

dress for the erroneous determination of state law.”

Id. at 13a. Congress could not have intended that

result, said the court, “[b]ecause [Section] 7 of the

NLRA gives employees the right to refrain from bar-

gaining collectively as well as the right to do so.”

Ibid.

In addition, the panel majority was “persuaded by

the more general policies of federal labor law” that

“Congress would not want state officials erring on

the side of adjudicating state law disputes whenever

it is a close call as to whether a claim is preempted.”

Pet. App. 13a-l4a. “If anything,” the court reasoned,

“Congress would presumably want state officials to

defer to arbitration * * * if a claim even arguably is

intertwined with consideration of a collective bargain-

ing agreement containing an arbitration clause.” /d.

at 14a.

Judge Kozinski dissented. He noted that respond-

ent’s refusal to process petitioner’s claim because she

was covered by a collective bargaining agreement “is

clearly discrimination based on an exercise of pro-

tected federal rights.” Pet. App. 17a. In his view,

it does not matter that respondent’s policy was based

on his interpretation of state law: “[t]he point is,

9

[respondent] is applying state law and his own policy

in a way that impinges on protected federal rights.”

Ibid. Therefore, and contrary to the panel majority’s

view, it was necessary for the court to determine

whether Section 301 of the LMRA, 29 U.S.C. 185,

actually preempts resolution of petitioner’s claim by

the state agency, not whether the state policy was

reasonably intended to avoid the preemptive force of

Section 301. Jd. at 17a-18a.

Judge Kozinski then concluded, in agreement with

the district judge, that, under Lingle, petitioner’s

claim is not preempted by Section 301. “A court could

find that [Safeway] did not pay [petitioner] im-

mediately upon termination—and thus violated the

statute—without ever looking at the [collective bar-

gaining agreement].” Pet. App. 19a. The dissent also

found that respondent’s refusal to enforce wage-and-

hour claims under these circumstances impermissibly

burdens the NLRA rights of employees in petitioner’s

position in two ways. First, it denies only employees

“who exercise their federal labor rights” the benefits

of respondent’s pursuit of their state labor law

claims free of charge. Jd. at 20a. Second, it impedes

unionization efforts by giving employers a plausible

basis for telling employees during election campaigns

that if they “vote for the union,” then “the state

Labor Commissioner [will] abandon[] you.” IJd. at

21a & n.2.

10

SUMMARY OF ARGUMENT

1. Section 7 of the National Labor Relations Act

(NLRA), 29 U.S.C. 157, guarantees employees the

right to bargain collectively, and Section 8(a) (1),

29 U.S.C. 158(a) (1), protects employees from coer-

cion in the exercise of that right. This Court has

held that state action that impairs rights guaranteed

by the NLRA—including the right to bargain col-

lectively—is barred by direct operation of the Su-

premacy Clause. See Golden State Transit Corp. v.

City of Los Angeles, 493 U.S. 103, 109 (1989)

(Golden State II) ; Nash v. Florida Industrial Comm’n,

389 U.S. 235 (1967); see also Brown v. Hotel Em-

ployees, 468 U.S. 491, 503 (1984); Hill v. Florida,

325 U.S. 538 (1945). In Golden State II, supra, this

Court further held that 42 U.S.C. 1983 provides em-

ployees with a remedy for the State’s deprivation of

federal rights guaranteed under the NLRA.

In accordance with these principles, petitioner in

this case has a valid claim for relief under Section

1983, arising from respondent’s refusal to enforce her

state wage-and-hour claim. In applying Section 229

of the California Labor Code, respondent has adopted

a general policy of not enforcing certain wage-and-

hour claims of employees covered by collective bar-

gaining agreements containing an arbitration clause,

while at the same time enforcing similar claims of

employees who are not covered by such agreements.

See Pet. App. 25a. Because the policy goes beyond

the requirements of federal labor law preemption,

and effectively interferes with employees’ rights to

bargain collectively, it gives rise to a cause of action

under Section 1983 for the impairment of rights

guaranteed by the NLRA.

ll

2. Section 229 of the California Labor Code states

that respondent may not enforce claims involving

“any dispute concerning the interpretation or appli-

cation” of any collective bargaining agreement con-

taining an arbitration clause. See Pet. 3. Contrary

to respondent’s submission, see Pet. App. 8a, enforc-

ing state wage claims such as petitioner’s would not

require respondent to interpret Section 229 of the

California Labor Code in a manner that is inconsist-

ent with principles of preemption under Section 301

of the Labor-Management Relations Act (LMRA), 29

U.S.C. 185. Petitioner’s claim is not preempted by

Section 301 because the disposition of her claim turns

on whether petitioner received her final wage pay-

ment on time—an issue that can be resolved without

referring to any term of the collective bargaining

agreement covering petitioner. See Allis-Chalmers

Corp. v. Lueck, 471 U.S. 202, 220 (1985); Lingle v.

Norge Div. of Magic Chef, Inc., 486 U.S. 399, 409-

410 (1986). Moreover, as this Court made clear in

Lingle, 486 U.S. at 413 n.12, the fact that it might

be necessary to refer to the collective bargaining

agreement to determine the amount of wages due pe-

titioner as a remedy for her employer’s violation of

the state wage-and-hour laws would not require pre-

emption of her state-law claim.

3. In refusing to enforce late-payment claims

such as petitioner’s, where that policy is not required

by federal law, respondent in effect treats a category

of employees covered by collective bargaining agree-

ments with arbitration clauses less favorably than

other employees. That practice impermissibly bur-

dens the exercise of Section 7 rights by systemati-

cally depriving employees who exercise those rights

12

of the benefit, which other employees enjoy, of having

respondent press their state-law wage claims free

of charge. The fact that the discriminatory policy

might be characterized as arising from a good faith

“error” in applying a state statute that purports to

coincide with the scope of federal preemption does

not affect the analysis. Whatever the motive for the

policy, its effect is to impair employees’ federal rights

by selectively treating some categories of workers

covered by collective agreements less favorably than

employees not so covered. Moreover, the fact that

respondent’s refusal to enforce petitioner’s claim

might stem from an incorrect application or interpre-

tation of a state statute does not foreclose relief

under 42 U.S.C. 1983. See Nash v. Florida Industrial

Comm’n, supra; Golden State 11, supra. Regardless

of whether petitioner might be able to obtain enforce-

ment of her state-law claim by seeking a writ of

mandate in California state court, she is entitled

to sue directly for relief in federal court for the

impairment of her Section 7 rights. As this Court

held in McNeese Vv. Board of Educ., 373 U.S. 668,

671 (1963), the availability of a remedy under Sec-

tion 1983 for a violation of federal rights “may not

be defeated because relief was not first sought under

state law which provided a remedy.”

13

ARGUMENT

PETITIONER IS ENTITLED TO RELIEF UNDER 42

U.S.C. 1983 FOR RESPONDENT'S INTERFERENCE

WITH HER RIGHT TO BARGAIN COLLECTIVELY

UNDER SECTION 7 OF THE NLRA BY REFUSING

TO ENFORCE HER STATE WAGE CLAIM

Section 7 of the National Labor Relations Act

(NLRA), 29 U.S.C. 157, guarantees employees the

right to bargain collectively, and Section 8(a)(1),

29 U.S.C. 158(a) (1), makes it an unfair labor prac-

tice for an employer to coerce employees in the exer-

cise of that right. This Court has recognized, how-

ever, that the NLRA confers rights “generally on

employees and not merely as against the employer.”

Golden State Transit Corp. v. City of Los Angeles,

493 U.S. 103, 109 (1989) (Golden State 11) (NLRA

“creates rights in labor and management both

against one another and against the State.”). There-

fore, state action that impairs rights guaranteed

under the NLRA—including the right to bargain

collectively—is barred by direct operation of the

Supremacy Clause. See Nash v. Florida Industrial

Comm’n, 389 U.S. 235 (1967); see also Brown v.

Hotel Employees, 468 U.S. 491, 503 (1984); Hill v.

Florida, 325 U.S. 538 (1945). For example, in Nash,

the Florida Industrial Commission interpreted a state

law that barred individuals unemployed due to a labor

dispute from receiving unemployment benefits as ap-

plying to any individual who filed an unfair labor

practice charge with the National Labor Relations

Board. The Court found that the manner in which

the State applied the “labor dispute” disqualification

imposed a “financial burden” that, “like the coercive

actions which employers and unions are forbidden to

14

engage in,” had a “direct tendency to frustrate the

purpose of Congress to leave people free to make

charges of unfair labor practices to the Board.” 389

U.S. at 239. It therefore concluded that the Florida

law, as applied, violated the Supremacy Clause be-

cause the State could not “defeat or handicap a valic

national objective by threatening to withdraw state

benefits from persons simply because they cooperate

with the Government’s constitutional plan.” /bid.

The Court further held, in Golden State 11, that

42 U.S.C. 1983 provides employees with a remedy for

the State’s deprivation of federal rights guaranteed

under the NLRA. If a state statute or policy inter-

feres with conduct that is protected by the NLRA,

then “pre-emption follows ... as a matter of sub-

stantive right,” 493 U.S. at 110 (quoting Brown V.

Hotel Employees, 468 U.S. at 503), and any affected

employee may obtain relief under Section 1983 for

interference with his federal statutory rights. Golden

State I], 493 U.S. at 109 (NLRA gives employees

“rights enforceable against governmental interference

in an action under [Section] 1983”).

It follows, in our view, that petitioner has a valid

claim for relief under Section 1983, arising from re-

spondent’s refusal to enforce her wage-and-hour

claim. In applying Section 229 of the California

Labor Code, respondent has adopted a general policy

of not enforcing certain wage-and-hour claims of

employees covered by collective bargaining agree-

ments containing an arbitration clause, while at the

same time enforcing similar claims of employees that

are not covered by such agreements. See Pet. App.

25a. As explained more fully below, that categorical

policy is not required by principles of federal labor

law preemption under Section 301 of the Labor-

15

Management Relations Act (LMRA), 29 U.S.C. 185.

Because the policy goes beyond what preemption re-

quires, and systematically operates to the detriment

of employees covered by collective bargaining agree-

ments (in comparison with other employees), it effec-

tively interferes with employees’ rights to bargain

collectively under the NLRA. It therefore is barred

by the Supremacy Clause, and gives rise to a cause

of action under Section 1983 for the impairment of

rights guaranteed by the NLRA.*

* Petitioner asserts (Pet. 7-8, 11) that the governmental

action in this case, as in Golden State Transit Corp. v. City

of Los Angeles, 475 U.S. 608 (1986) (Golden State 1), impli-

cates Machinists preemption. See also Pet. App. 37a-38a

(district court opinion). Machinists preemption precludes

States from regulating in areas that Congress intended to be

“free from all reguiations, whether state or federal.” Building

& Constr. Trades Council v. Associated Builders & Contractors

of Massachusetts/Rhode Island, Inc., 113 S. Ct. 1190, 1195

(1993); see also Metropolitan Life Ins. Co. v. Massachusetts,

471 U.S. 724, 749-751 (1985); Lodge 76, Int’l Ass'n of Ma-

chinists V. Wisconsin Employment Relations Comm’n, 427

U.S. 132 (1976). However, the state action in this case is

barred not because it intrudes into an area that Congress

intended to leave unregulated, but because “of an actual con-

wed _ [Section] 7.” Brown v. Hotel Employees, 468 U.S.

a ;

In any event, it is immaterial to our analysis whether the

state action here is preempted because of an actual conflict

with Section 7 or based on principles of preemption articu-

lated in the Machinists case. In Golden State II, the Court

explained that a Section 1983 suit could be predicated, as here,

on state interference with rights “explicitly set forth in [Sec-

tion] 7,” or, as in Golden State I, on state interference with

“the right to make use of ‘economic weapons,’ not explicitly

set forth in the [NLRA], free of governmental interference.”

493 U.S. at 110-111.

16

A. Respondent’s Practice Of Refusing To Enforce State

Wage Claims Such As Petitioner's Is Not Required

By Principles Of Federal Labor Law Preemption And

Interferes With Employees’ Rights To Bargain Col-

lectively

1. Enforcement of petitioner’s claim is not preempted

by Section 301 of the LMRA

Before the district court in this case, both parties

agreed that respondent’s policy was to enforce Sec-

tions 201 and 203 of the California Labor Code “for

all employees except for those whose work is gov-

erned by [collective bargaining agreements] contain-

ing binding arbitration clauses.” Pet. App. 25a. Re-

spondent explains that the systematic policy of not

enforcing wage-and-hour claims of workers covered

by such contracts results from interpreting Section

229 of the California Labor Code in a manner that

is “required under federal law.” See Resp. Supple-

mental Brief in Reply to Brief for the United States

as Amicus Curiae 4 [hereinafter Resp. Supp. Br.].

Section 229 of the California Labor Code states that

respondent may not enforce claims involving “any

dispute concerning the interpretation or application”

of any collective bargaining agreement containing an

arbitration clause. See note 2, supra. Pet. App. 8a.

Respondent contends that the scope of the Section

229 bar, as construed by the California Division of

Labor Standards Enforcement (DLSE), is consistent

with, and required by, the preemptive force of Sec-

tion 301 of the LMRA, 29 U.S.C. 185, as interpreted

by this Court. See Allis-Chalmers Corp. v. Lueck,

471 U.S. 202, 220 (1985); Lingle v. Norge Div. of

Magic Chef, Inc., 486 U.S. 399, 409-410 (1986).

According to respondent, claims for late payment of

wages upon termination of employment are included

17

in the category of preempted claims that are unen-

forceable under state law, because determining the

amount due the employee as a result of the employ-

er’s violation always requires reference to the rate of

pay established by the agreement. Cf., e.g., Pet. App.

8a, 26a, 43a; Resp. Supp. Br. 4-5, 6 n.4. Respondent

explains that, under Section 203 of the California

Labor Code, the wages due an employee who has not

been timely paid continue at the “same rate” until

paid; in order to establish that rate and the amount

due, “it is necessary to look to the collective bargain-

ing agreement and ‘apply’ that agreement.” Pet.

App. 8a. Since resolution of late-payment claims re-

quires both “application” and “interpretation” of the

collective bargaining agreement, those claims are

preempted under Section 301 of the LMRA.

Respondent errs in concluding that wage-and-hour

claims such as petitioner’s are preempted by Section

801 of the LMRA. In Lingle, 486 U.S. at 409-410.

this Court ruled that a state-law claim is preempted

under Section 301 only if resolution of the claim in-

volves interpreting a collective bargaining agree-

ment.® See also Allis-Chalmers Corp. v. Lueck, 471

U.S. at 220 (preemption applies when “resolution of

* The Lingle Court held that a state tort claim of retaliatory

discharge was not preempted, even though the employee in

Lingle was covered by a collective bargaining agreement con-

taining a “just cause” discharge clause, because resolution of

the claim involved “purely factual questions” pertaining to

the conduct of parties and “d[id] not require construing the

collective-bargaining agreement.” 486 U.S. at 407. The Court

explained that Section 301 preemption “merely ensures that

federal law will be the basis for interpreting collective-

bargaining agreements, and says nothing about the substan-

tive rights a State may provide to workers when adjudication

of those rights does not depend upon the interpretation of

such agreements.” Jd. at 409.

18

a state-law claim is substantially dependent upon

analysis of the terms of an agreement made between

the parties in a labor contract’). As the district

court and the dissenting judge in the court of ap-

peals correctly observed (Pet. App. 19a, 41a), it is

not necessary to refer to the collective bargaining

agreement to determine whether petitioner’s late pay-

ment claim has merit. Rather, it is possible to de-

termine whether Safeway violated its state-law obli-

gation to make prompt payment of wages at termi-

nation without referring to the collective bargaining

agreement at all. Both parties agreed on the amount

that petitioner had earned and was due to be paid;

the only disagreement concerned the timing of the

payment. Thus, the liability determination in this

case does not turn on any dispute about the precise

amount of wages due petitioner, or about how her

wages should be calculated under terms of the collec-

tive bargaining agreement governing rate of pay.°

* That is not to say that there could never be any disputes

arising under the California Labor Code provisions governing

wages and hours that would be preempted under Section 301.

For example, this case is arguably distinguishable from

Plumbing, Heating & Piping Employers Council v. Howard,

126 Cal. Rptr. 406 (Cal. Ct. App. 1975), in which the Cali-

fornia Court of Appeal held that Section 229 of the Labor

Code precluded the California Labor Commissioner from en-

forcing a claim for wages that arose from a dispute over

whether a journeyman plumber was entitled to receive a fore-

man’s rate of compensation for his work on a construction

job. There were two collective bargaining agreements in that

case that set forth the conditions under which a worker quali-

fied as a foreman entitled to a foreman’s rate of pay. The

contracts apparently had to be “interpreted” and “applied,”

within the meaning of Lingle, supra, to resolve the merits of

the claim. First, it was necessary to decide which contract

19

Moreover, and contrary to respondent’s assump-

tion, the mere fact that it might be necessary to refer

to the collective bargaining agreement to determine

the amount of wages due an employee as a remedy

for a violation of the state wage-and-hour laws would

not require preemption of the claim. Cf., e.g., Pet.

App. 8a, 26a, 43a; Resp. Supp. Br. 4-5, 6 n.4. As

Lingle made clear, 486 U.S. at 413 n.12:

A collective-bargaining agreement may, of

course, contain information such as rate of pay

and other economic benefits that might be helpful

in determining the damages to which a worker

prevailing in a state-law suit is entitled.

In such a case, federal law would govern the inter-

pretation of the agreement, but “the separate state-

law analysis would not be thereby pre-empted.” Lin-

gle, 486 U.S. at 413 n.12. See also Allis-Chalmers

Corp. v. Lueck, 471 U.S. at 211 (“not every dispute

* * * tangentially involving a provision of a collec-

tive-bargaining agreement * * * is pre-empted by

[Section] 301”).’

applied to the particular job on which the plumber was work-

ing. Then it was necessary to interpret the applicable con-

tract to determine whether he qualified as a foreman, which

in turn determined whether the employer had paid the claim-

ant at the correct rate.

* Nor, contrary to respondent’s contention (Br. in Opp. 6-7

& n.9; Resp. Supp. Br. 4-5, 6 n.4), was it necessary to inter-

pret the collective agreement to determine whether Safeway’s

refusal to pay petitioner upon her discharge was “willful.”

Safeway did not refuse prompt payment because of a dis-

agreement over what was owed petitioner, but simply because

it preferred to mail her a check. Pet. App. 2a. In any event,

whether there exists a “good faith dispute” concerning

whether payment is due that precludes imposition of waiting

20

Allowing limited reference to the collective bar-

gaining agreement in establishing the damages due

on a state-law claim is not inconsistent with the ra-

tionale underlying federal preemption of claims un-

der Section 301 of the LMRA. Preemption seeks to

preserve interpretative uniformity and predictabil-

ity, as well as the role of arbitration, in resolving

contract disputes. It does so by requiring that dis-

putes over the meaning of contract terms be resolved,

in the first instance, through arbitration and by ap-

plying federal law. See Local 174, Teamsters v.

Lucas Flour Co., 369 U.S. 95, 103-104 (1962); Lin-

gle, 486 U.S. at 410-411. Looking to a collective bar-

gaining agreement for the sole purpose of obtaining

information on peripheral issues such as “rate of pay

and other economic benefits that might be helpful in

determining the damages to which a worker prevail-

ing in a state-law suit is entitled” (Lingle, 486 U.S.

at 413 n.12) does not create the same threat of dis-

uniformity, uncertainty, and avoidance of arbitra-

tion that would be presented by allowing state courts

to interpret substantive contract terms to determine

the parties’ respective rights and responsibilities un-

der the contract, or the existence of liability under

state law.

2. Respondent’s refusal to enforce petitioner’s wage

claim interferes with the exercise of her rights

under Section 7 of the NLRA regardless of whether

it results from an “erroneous” or overly broad

application of state law

As explained above, respondent is mistaken in his

assumption that, in refusing to enforce petitioner’s

wage claim, he is applying Section 229 of the Cali-

time penalties under California Labor Code Section 203 is a

question of state law that can be determined without inter-

preting the terms of the collective agreement.

ee

21

fornia Labor Code in a manner that coincides with

the scope of federal preemption under Section 301 of

the LMRA. Section 301 does not preempt late-

payment claims such as petitioner’s, and does not re-

quire that respondent refrain from enforcing such

claims under state law.

Although a State would be entitled to adopt a rule

of refusing to process claims that come within the

scope of this Court’s doctrine of federal labor law

preemption under Section 301 of the LMRA, as artic-

ulated in Lingle, supra, and other cases, respondent

simply does not follow such a practice here. Re-

spondent has in fact adopted a general rule in apply-

ing Section 229 of the California Labor Code that

exceeds the scope of federal preemption: he does not

enforce certain categories of wage-and-hour claims

of individuals covered by collective bargaining agree-

ments containing an arbitration clause, even where,

as here, those claims do not require an interpretation

of the collective bargaining agreement under this

Court’s decisions. By categorically refusing, without

any valid justification, to enforce some types of

claims of individuals covered by collective bargaining

agreements containing an arbitration clause, while

at the same time enforcing similar claims for the

benefit of other employees not covered by such agree-

ments, the State has in effect discriminated against

the former employees based on the exercise of their

rights under the NLRA. As the dissent correctly

noted, respondent’s refusal to enforce wage-and-hour

claims under these circumstances impermissibly bur-

dens the NLRA rights of employees in petitioner’s

position in two ways. First, it denies only employees

“who exercise their federal labor rights” to negotiate

a collective agreement with an arbitration clause the

benefit of having the Commisioner press their state-

22

law wage claims for them free of charge. Pet. App.

20a. Second, it impedes the efforts of employees to

unionize by giving employers a plausible basis for

telling employees during election campaigns that i

they “vote for the union,” then “the state Labor

Commissioner [will] abandon[] you.” Jd. at 21a

& n.2.

The fact that the discrimination might be charac-

terized as arising from a good faith “error” in apply-

ing a state law or policy that purports to coincide

with the scope of federal preemption does not affect

the analysis in this case. For the error, which is

based on a misconception of the requirements of fed-

eral law, results in withdrawing important state pro-

tections from an entire group of employees who dif-

fer from protected employees only in having exer-

cised their federally guaranteed rights.* Although the

policy might not have been formulated with the ex-

press purpose of “discriminating” against workers

who have chosen to be covered by a collective bar-

gaining agreement, it nevertheless has the effect of

impairing employees’ federal rights by selectively

treating some categories of workers covered by col-

lective agreements less favorably than employees not

so covered.

The preemption rationale for DLSE’s policy, as

interpreted by the court of appeals, might conceivably

permit the Commissioner to pursue some wage-and-

8’ Many States have statutes similar to that of California.

See individual Employment Rights Manual, 9A Lab. Rel. Rep.

(BNA) No. 60, at 519:107 (1990). The purpose of such

statutes is to protect lower-wage workers who live from pay-

check to paycheck and cannot afford the uncertainty of wait-

ing weeks after termination until their employer decides to

make a final payment of wages due.

oe co _

23

hour claims of individuals covered by collective bar-

gaining agreements.’ Nevertheless, the pattern of

enforcement dictated by such a policy would still

give rise to a cause of action under Golden State

II where, as here, the Commissioner is refusing

to process a category of claims that is not in fact

preempted under a correct reading of federal law.

A policy that systematically results in the enforce-

ment of all otherwise qualified claims of eligible

employees-who are not covered by collective agree-

ments, but of only some claims of employees covered

by such agreements, impermissibly burdens the right

to bargain collectively under the NLRA, because the

precondition for respondent’s less favorable treatment

would be the employee’s exercise of Section 7 rights.

Cf. Phillips v. Martin Marietta Corp., 400 U.S. 542

(1971) (employer’s policy of refusing to hire women

with pre-school-age children while hiring men with

such children constitutes sex discrimination within

the meaning of Title VII of the Civil Rights Act of

1964). That burden is especially pronounced here,

since many collective bargaining agreements that

contain arbitration clauses customarily fix employees’

rate of pay.

® Respondent contends (Br. in Opp. 4 & nn.5, 6) that Sec-

tion 229 would not preclude him from prosecuting claims for

recovery of wages paid by a check returned for insufficient

funds, for recovery of employees’ work tools or damages for

their loss, or for recovery of state-mandated minimum wages.

Also, the Commissioner presumably would take the position

that he would not be barred from pursuing late-payment

claims like petitioner’s on behalf of employees covered by

collective bargaining agreements that do not fix wages.

24

B. Petitioner Has A Cause Of Action Under 42 U.S.C.

1983 For Respondent's Refusal To Enforce Her Wage

Claim Under State Law

The fact that respondent’s actions could arguably

be characterized (see Br. in Opp. 4-8) as stemming

from an erroneous application of a state statute

(which, if correctly applied, would not preclude en-

forcement of petitioner’s claim) does not negate the

violation of petitioner’s Section 7 rights that results

from that erroneous application, nor does it fore-

close relief under Section 1983. In analogous situa-

tions, the courts have found unlawful the application

of a facially valid policy in a manner that abridged

NLRA rights or discriminated against those exercis-

ing such rights.

Thus, in Nash v. Florida Industrial Comm'n,

supra, this Court held that a permissible state

policy of denying unemployment benefits to indi-

viduals unemployed due to a labor dispute could

not be applied to deny such benefits to an individual

simply because she had filed an unfair labor practice

charge with the National Labor Relations Board.

Similarly, in United Steelworkers vy. Johnson, 830

F.2d 924 (8th Cir. 1987) (en banc), the court en-

joined a state official from denying unemployment

benefits to union employees while granting benefits

to their non-union coworkers in connection with the

same labor dispute. The court acknowledged that the

state statute, which prescribed an “able and willing

to work” eligibility standard for unemployment bene-

fits, was valid and could be applied to employees

participating in a labor dispute, but it nonetheless

held that the State had “failed to apply this test in

a neutral, nondiscriminatory manner” by presuming

that no union members, as opposed to non-members,

ee eee

25

would be willing to work despite the labor dispute.

830 F.2d at 928-929. Finally, in Rum Creek Coal

Sales, Inc. vy. Caperton, 971 F.2d 1148 (4th Cir.

1992), the court enjoined the State’s policy of not

arresting picketers trespassing on a coal mine oper-

ator’s property during a strike. The court acknowl-

edged that the State’s “Neutrality Statute,” which

barred the state police from “aid[ing] or assist[{ing]

either party” to “any labor trouble or dispute be

tween employer and employee,” placed a facially

neutral and permissible condition upon the ability

of the parties to a labor dispute to claim the services

of the state police. 971 F.2d at 1150, 1154. It none-

theless held that, by interpreting the Neutrality

Statute as requiring state officials to allow strikers

to “prevent{] ingress and egress into [private]

property,” the State applied the statute in a manner

that undermined the coal company’s “rights to stay

in business and withstand a strike,” which were

guaranteed under federal law. /d. at 1154.

These cases illustrate that the court of appeals

was simply mistaken in stating that “[a] misinter-

pretation of a perfectly valid state statute * * *

does not provide grounds for federal relief.” Pet.

App. 12a. And, as this Court’s decision in Golden

State II makes clear, if the misinterpretation of a

facially valid state statute leads to the adoption of

a policy that interferes with employees’ exercise of

rights under the NLRA, that interference would pro-

vide grounds for federal relief under Section 1983.

Finally, the court of appeals advanced two insub-

stantial reasons for concluding that, even if the Com-

missioner had misapplied Section 229 of the Cali-

fornia Labor Code in refusing to enforce a claim

that was not preempted under federal law, petitioner

26

would still have no cause of action under Section

1983. First, the court reasoned that, “[g]iven the

primacy of the federal scheme for handling labor

disputes,” Congress “would not want state officials

erring on the side of adjudicating state law disputes

whenever it is a close call as to whether a claim is

preempted.” Pet. App. 14a. Rather, the court con-

cluded, “Congress would presumably want state offi-

cials to defer to arbitration and adjudication under

the federal scheme if a claim even arguably is inter-

twined with consideration of a collective bargaining

agreement containing an arbitration clause.” Ibid.

As the dissent correctly responded (id. at 18a), how-

ever, “[t]o the extent my colleagues are divining

some preemptive corona surrounding the federal

labor laws, it surely cannot include that which the

Supreme Court has said is not preempted.” This

Court in Lingle and other cases has made clear that

a state-law claim is preempted under Section 301 of

the LMRA only if resolution of the claim in fact

requires interpreting a collective bargaining agree-

ment. See pages 17-18, supra; see also Franchise Tax

Board y. Construction Laborers Vacation Trust, 463

U.S. 1, 25 n.28 (1983) (“we have never intimated

that any action merely relating to a contract within

the coverage of [Section] 301 arises exclusively under

that section”). In this respect, preemption under

Section 301 is more restrictive than preemption

under the doctrine of San Diego Building Trades

Council v. Garmon, 359 U.S. 236, 245 (1959) (state

jurisdiction must yield over activities that are

“arguably” protected or prohibited by the NLRA).

To permit Section 301 to preempt state wage-and-

hour claims that do not, in fact, require interpreta-

tion of the terms of a collective bargaining agree-

ee ee ee ee

ee ee oe We

27

ment would advance none of the purposes the pre-

emption doctrine is designed to serve, see page 20,

supra, and thus would result in an unjustified dis-

crimination against unionized employees who are

covered by collective bargaining agreements.

Second, the court of appeals erred in concluding

that petitioner could not sue for relief under Section

1983 because a remedy for respondent’s allegedly er-

roneous application of state law to bar enforcement of

her claim was available elsewhere: petitioner should

have sought a writ of mandate against respondent in

the California courts. Pet. App. 12a. As an initial

matter, it is unclear whether the California courts

would interpret Section 229 of the California Labor

Code in a way that vindicates petitioner’s rights un-

der Section 7 of the NLRA. Section 229, on its face,

prevents the Labor Commissioner from exercising

jurisdiction over claims requiring the “interpretation

or application of any collective bargaining agree-

ment” containing an arbitration clause. See Resp.

Supp. Br. 5-6. There is no assurance that the Cali-

fornia courts would reject the Commissioner’s ad-

ministrative interpretation of that unqualified statu-

tory language and would instead interpret it as

covering only those claims that are preempted by

Section 301 of the LMRA under principles set forth

in Allis-Chalmers and Lingle. But, in any event, this

Court has specifically recognized that Section 1983

was enacted “to provide a remedy in the federal

courts supplementary to any remedy any State might

have.” McNeese v. Board of Educ., 373 U.S. 668,

672 (1963). Therefore, the availability of relief

under Section 1983 for a violation of federal rights

“may not be defeated because relief was not first

sought under state law which provided a remedy.”

28

Id. at 671. Accord Damico vy. California, 389 U.S.

416, 416-417 (1967) (per curiam); Houghton v.

Shafer, 392 U.S. 639, 639-641 (1968) (per curiam).

See Monroe v. Pape, 365 U.S. 167, 183 (1961); cf.

id. at 224-225 (Frankfurter, J., dissenting in part)

(taking the position, rejected by the majority in that

case, that the availability of a civil remedy under

state law should bar relief under Section 1983); see

also Adickes v. S.H. Kress & Co., 398 U.S. 144,

167-168 (1970) (Section 1983 relief available for

discriminatory practices of state officials, “[a]lthough

not authorized by written law’); Monell v. Depart-

ment of Social Services, 436 U.S. 658, 690-691 (1978)

(same). It follows that petitioner stated a valid claim

under Section 1983 and is entitled to appropriate

relief.

CONCLUSION

The judgment of the court of appeals should be

reversed.

Respectfully submitted.

Drew S. Days, III

Solicitor General

DANIEL SILVERMAN LAWRENCE G. WALLACE

Acting General Counsel Deputy Solicitor General

LINDA SHER Amy L. WAX

Acting Associate General Assistant to the Solicitor

Counsel General

NORTON J. COME

Deputy Associate

General Counsel

National Labor

Relations Board

MARCH 1994

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