Petition for Writ of Certiorari — Hart v. Stockmar Energie, Inc.

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IN THE

Supreme Court of the Vuited States

OCTOBER TERM, 1993

JOHN J. HART,

Petitioner,

Vv.

STOCKMAR ENERGIE, INCORPORATED,

d/b/a L.F.C. POWER CORPORATION,

Respondent.

Petition for a Writ of Certiorari to the

Superior Court of the State of California

in and for the County of Sacramento

Appellate Department

PETITION FOR A WRIT OF CERTIORARI

LAURENCE J. COHEN

VICTORIA L. Bor *

SHERMAN, DUNN, COHEN,

LEIFER & YELLIG, P.C.

1125 Fift. anth Street, N.W.

Suite 801

Washington, D.C. 20005

(202) 785-9300

Attorneys for Petitioner

* Counsel of Record

WILSON - EPES PRINTING Co.. INC. - 789-0096 - WASHINGTON, D.C. 20001

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QUESTION PRESENTED

In ruling that Section 301 of the Labor-Management

Relations Act, 29 U.S.C. § 185, pre-empts application of

the California wage-and-hour law to employees working

under collective bargaining agreements, did the Superior

Court for the State of California; in and for the County

of Sacramento, Appellate Department, deprive petitioner

of rights guaranteed him under Section 7 of the National

Labor Relations Act, 29 U.S.C. § 157?

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PARTIES TO THE PROCEEDINGS BELOW

All parties to the proceedings in the courts below are

listed in the caption.

TABLE OF CONTENTS

Page

OPINIONS BELOW ............ ne 1

hile nliilininnsiiesensienmetsesnetdinentiinnsetans 2

STATUTORY PROVISIONS INVOLVED ........ 2

STATEMENT OF THE CASE 022 2oo.n......2..-..se-seess-e-- 3

ee 3

SE 5

REASONS FOR GRANTING THE WRIT... 7

EE ee 16

(iii)

iv

TABLE OF AUTHORITIES

CASES Page

Alexander v. Gardner-Denver Co., 415 U.S. 36

EEO ee Se TTR ss CPN ERE To 11

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

RE PU OR Ee oe a ee 8,9

Barrentine v. Arkansas-Best Freight System, Inc.,

gS Re 0 Pe ee ee 9,11

Caterpillar, Inc. v. Williams 482 U.S. 386 (1987).. 9

Commodore v. University Mechanical Contractors,

Inc., 120 Wash. 2d 120, 839 P.2d 314 (1992)... 8

Electrical Workers v. Hechler, 481 U.S. 851

8 | RS PR SERA” SL a 9

Fort Halifax Packing Co., Inc. v. Coyne, 482 U.S.

Ee: ; esters eee 10, 11, 14-18

Galvez v. Kuhn, 933 F.2d 773 (9th Cir. 1991) -....... 8

Knudson v. Superior Court, 267 Cal. App. 2d 876,

73 Cal. Rptr. 513 (4th Dist. 1968) 7

Lingle v. Norge Division of Magic Chef, Inc., 486

es I ail ac cnc ccceeepingnevestapanecithdicinnssene 8

Livadas v. Aubry, 749 F. Supp. 1526 (N.D. Cal.

1990), rev’d, 943 F.2d 1140 (9th Cir. 1991),

petition for cert. filed, 61 U.S.L.W. 3836 (June

Se Cs aii rtiticieietinctinenerentenannn passim

Machinists v. Wisconsin Employment Relations

Commission, 427 U.S. 1382 (1976) ..........---0-.. 10, 15

Metropolitan Life Insurance Co. v. Commonwealth

of Massachusetts, 471 U.S. 724 (1985) —.........-. passim

Nash v. Florida Industrial Commission, 389 U.S.

Ms TR ia BRR” “EN aL see 11-12

Rum Creek Coal Sales v. Caperton, 971 F.2d 1148

A a eaiiemate 9,12

Simon v. Superior Court, 4 Cal. App. 4th 63, 5

- 8 fF eee 7

Steelworkers v. Johnson, 830 F.2d 924 (8th Cir.

alta 9, 12-13

Teamsters v. Lucas Flour, 369 U.S. 95 (1962)........ 9

STATUTES

I i call 2

National Labor Relations Act, 29 U.S.C. § 157 __.... passim

Vv

TABLE OF AUTHORITIES—Continued

Page

National Labor Relations Act, 29 U.S.C. § 158 _........ 7,11

Labor Management Relations Act, 29 U.S.C. §185.. 6,7

1 aca cic ccconsusiinsnehaeminernatiniidecss 5

i a a nn cnetanmelinsenine 7

Cal. Civ. Proc. Code § 1086 ........................000.....000....... 7

os scesaiateceicaabbidaiamebaieies 5

— § ES ee 4, 5,10, 15

i ans nsnccnntntmenncnsenntguannsingennial passim

Cal. Lab. Code § 208 ....... sdenlidnagescaniinaneanabeoningtaaaaas 5

IT ssicalasboeapbenbaiesinaeeiueal 5, 6, 7,16

. A, RRNA eee Re ae APTS om 12

MISCELLANEOUS

Note, The Need for a New Approach to Federal

Preemption of Union Members’ State Law

Claims, 99 Yale L.J. 209 (1989) 8

Supreme Court uf the Auited States

OctToBer Term, 1993

No.

Joun J. Hart,

¥. Petitioner,

STOCKMAR ENERGIE, INCORPORATED,

d'b/a L.F.C. Power CorPORATION,

Respondent.

Petition for a Writ of Certiorari to the

Superior Court of the State of California

in and for the County of Sacramento

Appellate Department

PETITION FOR A WRIT OF CERTIORARI

Petitioner John J. Hart prays that the Court issue a

writ of certiorari to the Superior Court of the State of

California, in and for the County of Sacramento, Appel-

late Department.

OPINIONS BELOW

The decision of the Sacramento Municipal Court is set

forth at pages la to 9a of the Appendix (App. 1a-9a).

The ruling of the Superior Court of the State of Califor-

nia, in and for the County of Sacramento, Appellate De-

partment, reversing the Municipal Court, is set forth at

App. 10a, and the Superior Court's decision on petition

the Third Appellate District, denying petitioner's petition

for writ of mandate, is set forth at App. 13a. The order

the Supreme Court of the State of California, denying

petitioner's petition for review, is set forth at App. 14a.

None of these decisions or orders has been officially re-

JURISDICTION

The Superior Court of the State of California, in and

for the County of Sacramento, Appellate Department,

entered its ruling on petition for rehearing, reversing the

trial court and finding the petitioner's claim pre-empted by

federal law, on October 13, 1992. On January 28, 1993,

the Court of Appeal of the State of California denied

itioner’s writ of mandate, and on March 17, 1993,

the California State Supreme Court issued its order deny-

ing petitioner's petition for review of the Court of Appeal

order. On June 9, 1993, the Honorable Justice Sandra

Day O'Connor issued an order granting petitioner a

thirty-day extension of time, until July 15, 1993, in which

to file this petition for writ of certiorari. This Court has

jurisdiction over this petition pursuant to 28 U.S.C.

§ 1257(a).

STATUTORY PROVISIONS INVOLVED

Section 7 of the National Labor Relations Act, 29

U.S.C. § 157, provides in relevant part:

Employees shall have the right of self-organization,

to form, join, or assist labor organizations, to bar-

gain collectively through representatives of their own

ing, and to engage in other concerted activities

for the purpose of collective bargaining or other

mutual aid or protection * * *.

Section 301(a) of the Labor-Management Relations

Act, 29 U.S.C. § 185(a), provides:

Suits for violation of contracts between an employer

and a labor organization representing employees in

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an industry affecting commerce as defined in this

Act, or between any such labor organizations, may

be brought in any district court of the United States

having jurisdiction of the parties, without respect to

the amount in controversy or without regard to the

citizenship of the parties.

Cal. Lab. Code § 201 provides in relevant part:

If an employer discharges an employee, the wages

earned and unpaid at the time of discharge are due

and payable immediately.

Cal. Lab, Code § 203 provides in relevant part:

If an employer willfully fails to pay, without abate-

ment or reduction, in accordance with Sections 201,

201.5, and 202, 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 or until an action therefor

is commenced; but such wages shall not continue for

more than 30 days.

Cal. Lab. Code § 229 provides:

Actions to enforce the provisions of this article for

the collection of due and unpaid wages claimed by

an individual may be maintained without regard to

the existence of 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.

STATEMENT OF THE CASE

A. Facts

Petitioner John Hart is a construction electrician. Be-

tween May 16 and August 29, 1988, Respondent Stock-

mar Energie, doing business as L.F.C. Power Systems

Corp. (“LFC”), employed Hart under a collective bar-

gaining agreement between the company and the National

a ae

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4

Industrial Union (“NIU”).’ On August 29, LFC’s field

supervisor, Don Morrell, terminated Hart, and presented

him with a check for wages owed through the time of his

termination. Upon receiving the check, Hart pointed out

to Morrell that he had worked one hour of overtime dur-

ing the preceding pay-period which was not reflected in

the paycheck, and that he was therefore entitled to more

money. App. 5a.

The California Labor Code requires an employer who

discharges an employee to pay that employee all wages

due at the time of discharge. Cal. Lab. Code § 201. It

further imposes penalties on employers who willfully fail

to make timely payments. /d. § 203.

Two weeks after he was terminated, Hart still had

not received pay for his overtime. At Hart’s request,

Ed Stuart, the NIU Business Manager, filed a grievance

with LFC, seeking both the wages owed for the overtime

work, and “all applicable penalties under state and federal

law.” App. 2a. Stuart met with an LFC representative

on September 26, 1988, and, on October 10, Hart re-

ceived a check from LFC for $27.38 in overtime com-

pensation. NIU declined to process the grievance any

further: there were no provisions in the collective bar-

gaining agreement for penalties for late payments, and

the union had therefore secured all the relief available

through the grievance-arbitration procedure. App. 3a.

Hart then began his attempts to secure § 203 penal-

ties under California law. The California Labor Code

authorizes the state Labor Commissioner to enforce claims

for penalties owed under §§ 201 and 203, on behalf of

employees who are “financially unable to employ counsel

and . .. have claims which are valid and enforceable.”

1 At the time of the events in this case, petitioner Hart was a

member of the NIU. That union subsequently disbanded, App. 3a,

and Hart is now a member of Local 340 of the International Brother-

hood of Electrical Workers, AFL-CIO.

5

Cal. Lab. Code § 98.3(a). Hart filed a claim for penal-

ties with the Labor Commissioner. As a matter of policy,

however, the Commissioner does not process claims

filed by employees working under collective bargaining

agreements, Livadas v. Aubry, 749 F. Supp. 1526, 1528

(N.D. Cal. 1990), rev’d, 943 F.2d 1140 (9th Cir. 1991),

petition for cert. filed, 61 U.S.L.W. 3836 (U.S. June 3,

1993) (No. 92-1920),? and he therefore declined to

process Hart’s claim. App. 3a. Hart subsequently filed a

civil action to collect the penalties in the Sacramento Mu-

nicipal Court.’

B. Proceedings Below.

Hart filed his complaint in the Sacramento Municipal

Court on September 1, 1990. LFC defended on the

grounds, inter alia, that resolution of Hart’s claim re-

quired “the interpretation or application of a collective

bargaining agreement,” and was therefore both barred by

§ 229 of the California Labor Code and preempted by

§ 301 of the Labor Management Relations Act, 29 U.S.C.

§ 185. App. 3a. After trial, Judge John Lewis held, as

2The facts underlying Livadas are almost identical to those

herein. Karen Livadas was terminated from her job, received her

final paycheck three days later, and filed a claim under Labor Code

§§ 201 and 203 with the State Labor Commissioner, who declined

to process it “for the sole reason that she [was] an employee with a

[collective bargaining agreement] containing an arbitration clause.”

749 F. Supp. at 1528. Rather than pursuing her claim in state

court, as did Mr. Hart, Ms. Livadas filed an action in the federal

district court, claiming that the Commissioner’s denial of benefits

interfered with her federal rights under the NLRA, and therefore

violated 42 U.S.C. § 1983. On cross motions for summary judgment,

the district court held that Livadas had stated a claim under § 1983.

749 F. Supp. at 1535. The Ninth Circuit, however, reversed. 943

F.2d at 1147.

3 Section 208 of the California Labor Code, Cal. Lab. Code § 208,

permits individuals to pursue claims to enforce provisions of the

Code in state court. Hart filed his complaint and prosecuted the

action in Municipal Court pro se.

6

a matter of law, that the claim was neither barred by the

statute nor pre-empted by Section 301. App. 4a. He fur-

ther found, on the facts, that LFC had willfully withheld

Hart’s overtime compensation, and awarded Hart penal-

ties totalling $4,380.00. App. 8a-9a. The judge found no

need to apply or interpret the collective bargaining agree-

ment in making these determinations.

LFC appealed the Municipal Court’s decision to the

Appellate Department of the Superior Court of the State

of California. In opposing the appeal, Hart specifically

noted the dangers inherent in finding § 301 to pre-empt

minimum state labor standards. Quoting from Metropoli-

tan Life Insurance Co. v. Commonwealth of Massachu-

setts, 471 U.S. 724, 756 (1985), Hart pointed out that:

[i]t would turn the policy that animated the Wagner

Act on its head to understand it to have penalized

workers who have chosen to join a union by pre-

venting them from benefiting from state labor regu-

lations imposing minimum standards on nonunion

employers.

Respondent’s Opening Brief on Appeal from the Munici-

pal Court of Sacramento County, at 7.

On September 10, 1992, the Superior Court entered an

order, reversing the Municipal Court’s judgment without

explanation. LFC filed a petition for rehearing, requesting

a statement of the rule of law to be applied by the trial

court. The Superior Court granted the petition and en-

tered a new decision, holding that Hart’s claims were

“barred by Labor Code section 229 and pre-empted by

section 301 ....” App. 11a.

Hart sought review of the Superior Court’s decision by

filing a petition for writ of mandate with the California

Supreme Court.‘ The Supreme Court transferred the

4 California does not provide any appeal as of right from the

Superior Court. A litigant seeking relief from a Superior Court

decision may attempt to obtain discretionary review, either through

a court of appeal order, transferring the case “when the superior

court certifies, or the court of appeal determines, that such transfer

7

matter to the Court of Appeals, App. 12a, which denied

the petition for writ of mandate. App. 13a. Hart then

sought review by the State Supreme Court, which that

court denied. App. 14a.

REASONS FOR GRANTING THE WRIT

In crafting doctrines of federal labor pre emption—

under § 301 of the LMRA, and under §§ 7 ana © of the

National Labor Relations Act, 29 U.S.C. §§ 157 and

158—this Court has sought to balance the states’ legiti-

mate local interests in exercising their police powers, and

the federal interest in advancing the various policies em-

bodied in national labor law. Purporting to apply this

Court’s principles governing pre-emption under § 301,

the Superior Court held that provisions of California’s

minimum wage statute were unavailable to the petitioner

solely because he was employed under a collective bar-

gaining agreement.” The court’s decision in this regard—

which “penalized workers who have chosen to join a

union” by withholding the benefits of state labor regula-

tions, Metropolitan Life, 471 U.S. at 756—merits this

Court’s review for two related reasons.

appears necesary to secure uniformity of decision or to settle im-

portant questions of law,” Cal. Civ. Proc. Code § 911; or through

a writ of mandate, Cal. Civ. Proc. Code § 1085. See, Simon v.

Superior Court, 4 Cal. App. 4th 638, 68, 5 Cal. Rptr. 2d 428 (1992);

Knudson v. Superior Court, 267 Cal. App. 2d 876, 880 (1968)

(citing Cal. Code of Civ. Pro. § 988t, precursor to § 911.)

5 Although Cal. Labor Code § 229 and the Commission’s non-

enforcement policy purport to apply when employees work under

bargaining agreements containing arbitration provisions, the fact

is that “[f]ully 96% of [collective bargaining agreements] provide

for arbitration.” Livadas v. Aubrey, 749 F. Supp. at 1533 (citing

Characteristics of Major Collective Bargaining Agreements (U.S.

Dept. of Labor Bull. 2013, 1979), 82.) As a practical matter, the

Commissioner’s policy, endorsed by the Superior Court, thus pre-

cludes virtually all employees working under bargaining agreements

from enjoying the protections of the Labor Code.

8

First, the Superior Court’s ruling conflicts with the

principles articulated by this Court in Allis-Chalmers

Corporation v. Lueck, 471 U.S. 202 (1985), and Lingle

v. Norge Division of Magic Chef, Inc., 486 U.S. 399

(1988), regarding when the resolution of a state claim is

sufficiently “independent” of the collective bargaining

agreement to survive a claim of pre-emption under § 301.

To the extent the court’s error in this regard reflects

lingering confusion within both the federal and state ju-

diciaries in identifying when claims are “intertwined with”

or “independent of” labor agreements,° Allis-Chalmers,

471 U.S. at 212, the California court’s ruling warrants the

Court’s attention.

Moreover, the cavalier treatment of this case by the

Superior Court points up the danger that lurks in leavins

this area confused, for that court’s misapprehensions con-

cerning the reach of § 301 pre-emption threaten to under-

mine fundamental policies embodied in the NLRA, and

thus implicate principles of NLRA pre-emption. The court

understood § 301 to require the state to withhold the

benefits of an otherwise generally-applicable state mini-

mum-standards law to employees covered by a collective

bargaining agreement, without regard to whether that

agreement reaches the subject of the state law. The

California court’s decision disrupts the balance that fed-

eral labor laws seek to maintain, by placing a serious

6The Ninth Circuit has characterized § 301 pre-emption as a

“tangled interplay between federal and state law,” constituting ‘“‘one

of the most confused areas of federal litigation,” Galvez v. Kuhn,

933 F.2d 773, 776 (9th Cir. 1991), while the Supreme Court of

Washington has described this as an area in which “the courts are

still struggling to ascertain when a claim’s resolution actually will

involve interpretation of the collective bargaining agreement.”

Commodore v. University Mechanical Contractors, 120 Wash. 2d

120, 129, 889 P.2d 314, 318 (1992) (emphasis in original). As the

Washington court observed, “Section 301 cases are still far from

uniform or consistent, varying widely in their holdings, even after

Lingle.” Id. See also Note, The Need for a New Approach to

Federal Preemption of Union Members’ State Law Claims, 99 Yale

L.J. 209, 209 (1989) (describing Section 301 preemption as a

“thicket’).

9

impediment in the path of employees’ decisions whether,

and to what extent, to engage in collective bargaining.

In this regard, while it comports with the approach taken

by the Ninth Circuit in Livadas v. Aubry, 943 F.2d 1140,

the Superior Court’s decision directly conflicts with deci-

sions of the Fourth and Eighth Circuits. See Rum Creek

Coal Sales v. Caperton, 971 F.2d 1148 (4th Cir. 1992),

and Steelworkers v. Johnson, 830 F.2d 924 (8th Cir.

1987) (en banc). It accordingly presents an important

issue which should be settled by this Court.

1. In delineating the contours of § 301 pre-emption,

this Court has taken pains to define rules that would

preserve the interests embodied in federal labor policy,

while not subverting rights of states to establish minimum

protections for its citizens. Thus, on the one hand, § 301

pre-emption is invoked to foster the federal interests in

assuring uniform interpretations of collective bargaining

agreements, Teamsters v. Lucas Flour, 369 U.S. 95,

103-04 (1962), and preserving “the central role of arbi-

tration in our ‘system of industrial self-government.’ ”

Allis-Chalmers v. Lueck, 471 U.S. at 219 (quoting Steel-

workers v. Warrior & Gulf Navigation Co., 363 U.S. 574,

581 (1960)). In that respect, claims asserted under

state law will be deemed pre-empted when either “founded

directly on rights created by collective-bargaining agree-

ments, [or] ‘substantially dependent on analysis of a col-

lective-bargaining agreement.’” Caterpillar, Inc. v. Wil-

liams, 482 U.S. 386, 394 (1987) (quoting Electrical

Workers v. Hechler, 481 U.S. 851, 859 n.8 (1987)).

On the other hand, “different considerations apply

where the employee’s claim is based on rights arising out

of a statute designed to provide minimum substantive

guarantees to individual workers.” Barrentine v. Arkansas-

Best Freight System, Inc., 540 U.S. 728, 737 (1981).

This Court has accordingly made clear that it would be

“inconsistent with congressional intent under [§ 301] to

pre-empt state rules that . . . establish rights and obliga-

tions, independent of a labor contract.” Allis-Chalmers,

471 U.S. at 212 (emphasis added).

10

Petitioner’s claim herein is that the California Labor

Code established “rights” for private sector employees

who are terminated from their jobs, and imposed precise

“obligations” on employers, which exist, and are enforce-

able, “independent of a labor contract.” The Labor

Commissioner, and ultimately the Superior Court, viewed

both the state law itself and principles of labor pre-

emption to dictate otherwise. Thus, the Commissioner—

as endorsed by the court—read § 229, the state legisla-

ture’s pre-emption formula, to deprive any employee cov-

ered by a collective bargaining agreement of the protec-

tions of §§ 201 and 203. And the court found that

principles of federal labor law support and demand the

same result.

2. In Fort Halifax Packing Co., Inc. v. Coyne, 482

U.S. 1, 21 (1987), this Court emphasized that “pre-

emption should not be lightly inferred in this area, since

the establishment of labor standards falls within the

traditional police power of the State.” In Fort Halifax,

the state legislature guaranteed minimum benefits to rep-

resented and unrepresented employees alike. The issue

for this Court was whether it was inconsistent with

federal law for the state to exercise its power by pre-

scribing conditions for represented employees which their

unions could otherwise bargain. In the instant case, by

contrast, the state has “lightly inferred’ pre-emption as

a basis for withholding its power from one distinct sector

of the working public: those employees covered by col-

lective bargaining agreements. This case thus presents,

in the starkest terms, the risk to employees’ federally pro-

tected rights when the state erroneously views § 301 as

precluding it from even-handedly utilizing its traditional

police powers.

By misapplying principles of § 301 pre-emption, the

California court has implicated the related, but analytically

distinct, area of “Machinists” pre-emption under the

NLRA.’ As explained in Metropolitan Life v. Massachu-

7 Machinists v. Wisconsin Employment Relations Comm'n, 427

U.S. 182 (1976).

11

setts, 471 U.S. at 749, Machinists pre-emption “protects

against state interference with policies implicated by the

structure of the Act itself, by pre-empting state law and

state causes of action concerning conduct that Congress

intended to be unregulated.”* Understanding that the

NLRA’s primary concern is not with the substantive terms

of a privately-bargained agreement, but instead “with

establishing an equitable process for determining” those

substantive terms, id. at 753, this Court has held that

“{mJinimum state labor standards [that] affect union and

nonunion employees equally . . . neither encourage nor

discourage the collective-bargaining processes that are

the subject of the NLRA.” 7d. at 755 (emphasis added).

Under these principles, this Court has found no in-

consistency between the NLRA and state laws which

specify minimum benefits that either are available to all

employees, id., or are available to all unless the parties

to a collective bargaining agreement agree otherwise,

Fort Halifax Packing, 482 U.S. at 22. See also Barren-

tine v. Arkansas-Best Freight System, 450 U.S. at 745

(no incompatibility between federal law establishing mini-

mum employment standards and NLRA); Alexander v.

Gardner-Denver Co., 415 U.S. 36, 51 (1974). This

Court has, however, found a basic incompatibility between

federal labor policy and a state’s threat to withdraw state

benefits from employees who utilize the instruments of

that policy. Nash v. Florida Industrial Comm'n, 389

U.S. 235 (1967).°

8 While initially used “to determine whether certain weapons of

bargaining neither protected by §7 nor forbidden by § 8(b) could

be subject to state regulation[,]” the doctrine has come to be used

“to determine the validity of state rules of general application that

affect the right to bargain or to self-organization.” Jd. at 750-51

n.27.

® Nash involved Florida's application of its unemployment com-

pensation statute, which disqualified putative recipients for time

when their unemployment was “due to a labor dispute in active

progress.” 389 U.S. at 441. The state unemployment commission

considered an employee to be ineligible under that provision during

12

Three federal courts of appeals have recently considered

whether states may validly withhold the benefits of gener-

ally-applicable laws in ways which impinge on federally-

protected rights. Two of the three courts—the Fourth

and Eighth Circuits—found these state actions to vio-

late federal labor policy, while the Ninth Circuit held

otherwise. The Fourth Circuit case, Rum Creek Coal

Sales v. Caperton, 971 F.2d 1148, involved West Vir-

ginia’s application of its “Neutrality Statute,” W. Va.

Code § 15-2-13, which forbids state officers to “aid or

assist either party . . . in any labor trouble or dispute

between employer and employee ... .” 971 F.2d at

1150-52. The state police officially understood the stat-

ute to require them to refrain from providing even their

usual measure of protection during a labor dispute, and

during a coal mine strike, the police accordingly refused

to arrest picketers trespassing on mine property. While

acknowledging that the Neutrality Statute was facially

valid, the Fourth Circuit held that the police’s inaction

had hampered the mine owner’s federal right to withstand

a strike.

The Eighth Circuit reached a similar result in Steel-

workers v. Johnson, 830 F.2d 924, 926-29, concerning

South Dakota’s application of its unemployment compen-

sation laws. The state statute required that claimants be

“involuntarily unemployed” to be eligible for benefits.

In Johnson, a coal mine operator shut down the mine in

response to the union’s vote to strike. The South Dakota

Department of Labor denied benefits to all union mem-

bers who were locked out, but granted them to the

nonunion members of the bargaining unit, on the theory

the time when her unfair labor practice charge, alleging she had

been laid off for her union activities, was pending before the NLRB

since, in the state’s view, there was a “labor dispute in active prog-

ress” during that time. This Court held that the state’s threat to

withhold its benefits from employees who “cooperat[e] with the

Government’s constitutional plan” violated the Supremacy Clause.

Id. at 239.

13

that, because the latter were ineligible to participate in

the strike vote, they were “involuntarily unemployed.”

The members, by contrast, were deemed to be “voluntarily

unemployed.” Holding that the state agency’s “skewed

application of its facially neutral test . . . significantly

burdens the section 7 right to participate in organized

labor,” 830 F.2d at 928-29, the en banc court enjoined

South Dakota from applying the statute to disqualify

employees based on their union activity. /d.

Unlike the Eighth and Fourth Circuits, the Ninth

Circuit has failed to comprehend the damage to federal

labor policy wrought by a state’s practice of withholding

benefits based on the intended recipient’s exercise of pro-

tected rights. In Livadas v. Aubry, 943 F.2d 1140, the

Ninth Circuit was confronted with precisely the same

California Labor Commissioner’s policy that is at issue

herein. Livadas claimed that by denying her the benefits

of § 203, the Commissioner had violated her federal rights.

According to the Ninth Circuit, the gravamen of Livadas’

claim was that the Commissioner had misapplied facially

valid eligibility criteria, and in its view, Livadas had no

federal right to a correct interpretation of a valid state

statute. /d. at 1146. The court therefore held that it was

without jurisdiction to evaluate the Commissioner’s deci-

sion to deny represented employees the benefits of the

State statute.”®

10 While finding it unnecessary to reach the question whether the

Commissioner had incorrectly held Livadas’ claim to be pre-empted,

id. at 1145, the court nonetheless essentially applauded the Com-

missioner for erring—if at all—on the side of leaving the dispute

to be resolved through arbitration, id. at 1147, ignoring, as did the

state court in this case, the fact that the remedies available under

state law were not available under the collective bargaining agree-

ment, and therefore not attainable through arbitration.

Between Livadas and this case, employees working under collec-

tive bargaining agreements in California are trapped in a sort of

“Catch-22.” According to the Ninth Circuit, employees like Livadas

and Hart have no recourse in federal law and should, instead, pursue

a mandamus action in state court. Jd. at 1146. But according to the

14

3. The reach of the Superior Court's decision goes well

beyond the interests of the individual petitioner in this

case. Even limited to its particular facts, the case poses

serious questions whether the California Labor Com-

missioner may continue to decline to enforce protective

governed by collective bargaining agreements, and whether

the state courts may similarly refuse to entertain such

claims when individual employees attempt to prosecute

them on their own behalf.

Minimum labor standards, like those in Metropolitan Life,

Fort Halifax Packing, and the California Labor Code, are

extremely commonplace.” Indeed, enacting legislation

which provides basic protections, and forms the “back-

drop” against which parties may negotiate, “is ‘a valid

and unexceptional exercise of the [State's] police power.’ ”

Superior Court's ruling in the instant case, such a state court action

will not lie. These employees thus have no recourse at all, except in

this Court.

11 In providing but a “partial catalogue of [such] statutory em-

ployment standards in the [nine states in the) Ninth Circuit,” the

Service Employees International Union, AFL-CIO, CLC (“SEIU”),

was able to identify twenty state statutes which create minimum

employment conditions, including

timely wage payment on discharge, employee access to per-

sonnel files, prohibitions against wage deductions for breakage

or loss, prohibitions against blacklisting former employees, vest-

ing rights in unused vacation pay on discharge, mandatory

meal breaks and rest periods during the workday, and manda-

tory leave for jury and witness duty.

Brief of Amicus Curiae SEIU in Support of Petition for Certiorari,

Livadas v. Aubry, No. 92-1920, at 4-5 (citations omitted). See, id.

nn. 3-9 and Appendix.

15

Fort Halifax Packing, 482 U.S. at 21, 22 (quoting Metro-

politan Life, 471 U.S. at 758). The California court has

sanctioned the view that the mere presence of a collective

bargaining agreement strips employees of the protections

of state labor standards. Permitting this view to stand

would essentially give the states carte blanche to penalize

employees who choose to be represented by a collective

bargaining agent, or indeed, who, though not themselves

choosing union representation, are nonetheless represented

by a collective bargaining agent by virtue of the choice

of a majority of their co-workers.

Leaving the states with that power would serve seri-

ously to undermine the collective bargaining scheme em-

bodied in the NLRA and protected through Machinists

preemption. As Judge Kozinski noted in his dissent in

Livadas v. Aubry, California's approach to §§ 201 and

203 permits employers truthfully to warn their employees

during labor organizing campaigns: “Look here, if you

vote for the union, the first thing that happetis is that the

state Labor Commissioner abandons you.” 943 F.2d at

1150 n. 2 (Kozinski, dissenting). In fact, accepting the

Superior Court's approach as a reasonable means of state

regulation would permit employers to warn employees

generally that “if you vote for the union”, or if your

colleagues vote for the union, you may stand to lose the

full panoply of minimum wage and employment protec-

tions otherwise available under state law. No greater

deterrent to the exercise of § 7 rights is imaginable.

16

CONCLUSION

The Court should grant the petition for writ of

certiorari

Respectfully submitted,

LAURENCE J. COHEN

Victoria L. Bor *

SHERMAN, DUNN, COHEN,

Leirer & YELLIG, P.C.

1125 Fifteenth Street, N.W.

Suite 801

Washington, D.C. 20005

(202) 785-9300

Attorneys for Petitioner

* Counsel of Record

APPENDICES

la

APPENDIX A

SACRAMENTO MUNICIPAL COURT DISTRICT

COUNTY OF SACRAMENTO,

STATE OF CALIFORNIA

Case No. 89C18711

JOHN J. HART,

Plaintiff,

VS.

STOCKMAR ENERGIE, INC., dba L. F. C. POWER Corp.,

Defendant

DECISION ON SUBMITTED MATTER

The above entitled cause came before the Court for

trial on May 13, 1991. Plaintiff appeared in propria

persona; defendant appeared by attorney DOROTHY

BACSKATI EGEL. Evidence and argument were received,

and the matter was submitted.

No statement of decision was requested; none is re-

quired. The Court will, nevertheless, briefly explain its

decision.

The following facts were established by stipulation:

Plaintiff was employed by Defendant as a construction

electrician between May 16, 1988 and August 29, 1988.

During the period of employment, Plaintiff was covered

by the terms of a collective bargaining agreement (herein-

after referred to as “the CBA”) between the National

Industrial Union (hereinafter referred to as “NIU”) and

Defendant. The CBA governs the terms and conditions

of employment of Plaintiff by Defendant, including the

2a

payment of overtime pay; but per Plaintiff is not the sole

determinant. Article I, subsections 1.4(a) through 1.6

of the CBA provides for the resolution of grievances aris-

ing out of the CBA by the parties.

On August 29, 1988, Plaintiff was terminated from

employment with Defendant. During his last pay period,

Plaintiff did not inform either Morrell or Butterfield that

he had worked any overtime during that period. On or

about September 10, 1988, two (2) weeks after his em-

ployment ended, Plaintiff presented a grievance to his

union representative claiming, inter alia, that Defendant

owed Plaintiff overtime wages for one (1) hour’s over-

time work, and also claiming all applicable penalties under

state and federal law. On or about September 10, 1988,

Plaintiff's union representative presented a written griev-

ance on behalf of Plaintiff to Defendant’s collective bar-

gaining representative claiming, inter alia, overtime wages

and all applicable penalties under state and federal law.

On or about September 26, 1988, Plaintiff's union repre-

sentative met to discuss, inter alia, Plaintiff's claim for

overtime compensation and penalties. By check dated

September 30, 1988, Defendant paid Plaintiff Twenty

Seven Dollars Thirty-eight cents ($27.38). As of October

10, 1988, Plaintiff was paid all overtime wages which he

claimed to be owed by Defendant.

On the evidence presented without contradiction or

impeachment, the Court makes the following additional

findings:

At the time of Plaintiff's termination, Plaintiff’s hourly

rate was Eighteen Dollars Twenty-five cents ($18.25):

and Defendant furnished Plaintiff with a payroll check

which included payment for the hours worked, exclusive

of overtime hours, through the time of termination on

August 29, 1988. Defendant has not cashed the Twenty

Seven Dollars Thirty-eight cents ($27.38) check ulti-

mately paid for overtime. During the union and manage-

ment meetings regarding the grievance submitted on

LL

3a

Plaintiff's behalf, Defendant insisted that federal and state

penalties were not a part of the CBA. They in fact are

not included or excluded by the CBA. When contacted,

the union President refused to pursue the matter of penal-

ties through arbitration on that basis, informing Plaintiff

that his remedy lay with the state authorities for such a

claim. Shortly thereafter, the union “dissolved or dis-

banded” and per the evidence the union President “dis-

appeared.” Plaintiff sought intervention regarding the

penalties with the California Labor Commissioner. De-

fendant’s attorney at such proceedings asserted that the

Commission had no jurisdiction in light of Labor Code

§ 229 and federal preemption; that Plaintiff's remedy lay

with the NLRB. The Labor Commission declined jurisdic-

tion in light of Labor Code § 229. Plaintiff sought a

remedy with the NLRB, which declined to exercise juris-

diction to enforce the state penalties. Plaintiff then filed

this civil action.

In its answer to the amended complaint, Defendant

asserted certain affirmative defenses, to wit: (1) that

Plaintiff's claim requires the interpretation or application

of a collective bargaining agreement and is thereby pre-

empted by Section 301 of the Labor Management Rela-

tion Act, 29 USC § 185; (2) that Plaintiff's claim is

barred by Section 229 of the California Labor Code; (3)

that Plaintiff's claim is barred by the doctrine of accord

and satisfaction; (4) that Plaintiff's claim is barred by the

doctrine(s) of res judicata and/or collateral estoppel;

and (5) that any failure to pay wages due upon termina-

tion of Plaintiff's employment was not “willful” within

the meaning of California Labor Code § 203.

In earlier proceedings before a different Judge of this

Court, Plaintiff prevailed against Defendant’s demurrer

and motion for summary judgment.

The Court respecting the trial, has independently re-

searched the legal principles relevant to defendant’s af-

firmative defenses, and concludes that Plaintiff's claim

4a

(1) is not preempted by Section 301 of the Labor Man-

agement Relations Act; (2) is not barred by Section 229

of the California Labor Code; (3) is not barred by the

doctrine of accord and satisfaction; and (4) is not barred

by the doctrine(s) of res judicata and/or collateral estop-

pel. These conclusivs.. are legal in nature, based upon

essentially undisputed facts.

The substantial issue litigated and argued by the parties

at trial was that identified by the Court in its denial of

Defendant’s motion for summary judgment to wit:

Whether Defendant willfully failed to pay any overtime

wages due Plaintiff in accordance with Labor Code § 201

(sic).

Although the Court’s prior order refers only to Labor

Code § 201, the essential dispute between the parties

involves Labor Code § 203, which provides for waiting

time penalties for a willful failure to pay wages required

to be paid under Labor Code § 201. By regulation effec-

tive August 8, 1988, the State Labor Commission inter-

prets “willful” under the statute as follows:

“A willful failure to pay wages within the meaning

of Labor Code § 203 occurs when an employer in-

tentionally fails to pay an employee when those

wages are due. However, a good faith dispute that

any wages are due will preclude imposition of wait-

ing time penalties under Section 203.

A “good faith dispute” that any wages are due occurs

when an employer presents a defense, based in law

or fact which, if successful, would preclude any re-

covery on the part of the employee. The fact that a

defense is ultimately unsuccessful will not preclude a

finding that a good faith dispute did exist. Defenses

presented which, under all the circumstances, are un-

supported by any evidence, are unreasonable, or are

presented in bad faith, will preclude a finding of a

“good faith dispute”.”

8 Cal Code Reg 13520.

Sa

There was no dispv ia the evidence that on the after-

noon of Wednesday, August 24, 1988, Plaintiff, the field

supervisor (Morrell) and ‘he overall construction site

supervisor (Butterfield) met to discuss construction prog-

ress and Plaintiff's performance on the site. There was no

dispute that during the .vurse of that meeting there were

discussions regarding Plaintiff (as lead man) coming in

one-half (42) hour early to review the plans in prepara-

tion for each day’s activities. There was no dispute in the

evidence that if Plaintiff was authorized to do so, and if

Plaintiff did so prior to termination, Plaintiff was entitled

at termination to overtime pay both under the CBA and

under the company employee manual. There was no dis-

pute as to what the rate of pay would be, nor as to the

overtime Plaintiff claimed at termination.

There was no dispute in the evidence that Defendant

made the determination to terminate Plaintiff on Friday,

August 26, 1988; and effectuated the termination at mid-

morning on August 29, 1988. At that time, the check

tendered and accepted did not include payment for over-

time. There was no dispute in the evidence that when

Plaintiff accepted the check he indicated that he was

entitled to overtime pay.

Plaintiff was clear and adamant in his testimony that:

at the August 24, 1988 meeting, Butterfield stated that

he would authorize overtime for Plaintiff to come in early;

that Plaintiff came in early on Thursday, Friday, and

Monday; and that, when queried regarding the failure to

include overtime in the termination check, Morrell indi-

cated that he had just forgotten it, and would notify Port-

land to have an additional check forwarded. Butterfield

did not testify at the trial.

Testimony established that shortly prior to the termina-

tion of Plaintiff, Plaintiff had been a part of a dispute with

two or three other workers on the project, and that the

dispute had been discussed between Holland (Plaintiff's

6a

foreman), Morrell, and Butterfield. Holland testified that

he was quite satisfied with Plaintiff's work; and that, con-

trary to his recommendation, Morrell and/cr Butterfield

made the determination to layoff Plaintiff. Morrell testi-

fied that he thought he recalled that others were laid off

at about the same time as Plaintiff; all other evidence

presented was to the contrary.

Morrell testified that he recalled a discussion with

Holland regarding Plaintiff working overtime. His ada-

mant recollection was that the discussion was part of a

process of determining whether overtime would be au-

thorized. Holland’s recollection, though neither specific

nor unequivocal, was that Morrell’s statements were such

that Morrell knew that overtime had been authorized, and

was being worked.

On the issues of whether Plaintiff was authorized to

work overtime and whether Morrell knew of the authori-

zation, the Court finds in favor of Plaintiff and against

Defendant. The clear preponderance of the evidence so

indicated. As Plaintiff argued, the ultimate “smoking gun”

on the point is the “6:30 a.m.” entry by Morrell appear-

ing on Defendant’s Exhibit “E”.

Did Plaintiff begin work early on Thursday, Friday,

and Monday? His supporting witnesses (Norwood and

Murray) were little helpful on the question of whether

Plaintiff actually did work overtime as he testified. Nor-

wood’s testimony was internally inconsistent as he at-

tempted to recall whether he was or was not still com-

muting with Plaintiff on the subject mornings; Murray

recalled that Plaintiff worked early on Monday; but be-

lieved that Plaintiff started with the rest of the crew on

Thursday and Friday.

The foreman’s (Holland) Time Distribution Sheet did

not indicate overtime work, but Holland testified that he

did not come in early on Thursday, Friday, or Monday;

so would not know whether Plaintiff was working early

7a

or not. He was not informed on Friday of the Butterfield/

Morrell decision to terminate Plaintiff on Monday; so

would have had no special reason to inquire of Plaintiff

regarding the point. All witnesses agreed that it was

standard practice regarding the preparation of payroll and

termination checks to use both the Time Distribution

Sheet and the time cards. Plaintiff testified that he did

start work early, and that he did clock in. His time card,

- thus, would indicate whether he did or did not start

work early on the days involved. Morrell testified that on

Friday the 26th, to verify the Time Distribution Sheet

information as to Plaintiff, he looked for and could not

find Plaintiff's time card. Dorothy Beach Kofski testified

regarding her inability to find Plaintiff's card at some

point (she thought either Monday or Wednesday; con-

ceded it could have been the preceding Friday). Norwood

and Murray testified that Plaintiff's card was in the card

locker after Plaintiff left the project. When pressed by the

Court, Ms. Beach Kofski conceded that in the normal

practice of Defendant and in light of Defendant’s Exhibit

“D”, one might reasonably infer that Morrell had Plain-

tiffs time card when Defendant’s Exhibit “D” was pre-

pared. More importantly to the decision on this issue,

when confronted by Plaintiff at the time of termination

with the overtime issue, Morrell said nothing about a lost

time card; specifically it “never occurred to him” to say

anything about it. He testified that he later looked “aga.n”

for the time card and thinks he discussed it with Butter-

field, but did not remember whether he had inquired of

Holland. Finally, per his testimony, without Plaintiff’s

time card “there was no way to double check” Plaintiff's

contentions that he was owed wages for overtime work.

Plaintiff has suggested that Morrell did not check the

time card in connection with the preparation of the

termination check, and that its absence was not discovered

until Wednesday when Ms. Beach Kofski looked for it in

connection with her end of the month practice. This

8a

would be consistent with the testimony of Norwood and

Murray that Plaintiff's time card had remained at the

card locker after Plaintiff was terminated; but inconsistent

with Morrell’s testimony that immediately after Plaintiff

complained regarding the overtime pay he searched for

the card and it was missing. Moreover, it is inconsistent

with Morrell’s testimony that, when he accumulated the

information for the termination check, (on Friday) he

looked for and could not find Plaintiff's card.

On the evidence presented, the Court finds that De-

fendant was authorized to work the overtime hours, that

he did work the overtime hours, and that he was not paid

for the overtime hours until more than thirty (30) days

after they were due.

Undoubtedly, there will be cases where an employer,

upon good faith efforts to verify a terminating employee's

claims, will properly delay payment and submit to griev-

ance procedures related claims without incurring Labor

Code Section 203 penalties. But in this case, the Court

finds that Morrell (either in conjunction with Butterfield

or not) either participated in circumstances giving rise to

the loss of Plaintiff's card (after reviewing same and

determining that overtime was claimed); or, prepared and

delivercd to Plaintiff a termination check without verify-

ing by the time card whether overtime was claimed; then,

when reminded of an overtime claim, proceeded with a

reckless disregard for or indifference to Plaintiff's claim

until the time card was lost—thereby leaving the employee

in a situation where his claim would be fraught with the

difficulties of litigation, and failing memories. The cir-

cumstances of this case, on the evidence presented, pre-

clude a finding of a “good faith dispute”; Defendant's

failure to pay the overtime was “willful” within the mean-

ing of Labor Code § 203.

Plaintiff shall recover from defendant as a penalty

under Labor Code § 203 One Hundred Forty Six Dol-

9a

lars ($146.00) per day times thirty (30) days, for a

total of Four Thousand Three Hundred Eighty Dollars

($4,380.00), plus costs. Plaintiff to prepare and submit

an appropriate judgment for signature by the Court, sub-

mitting first to counsel for Defendant for approval as to

form.

Dated: May 22, 1991

/s/ John R. Lewis

JoHN R. Lewts

Judge of the Municipal Court

[SEAL]

10a

APPENDIX B

SUPERIOR COURT

OF THE STATE OF CALIFORNIA

IN AND FOR THE COUNTY OF SACRAMENTO

APPELLATE DEPARTMENT

Dept. No.: 21

August 21, 1992

Jupce ANTHONY DeCristororo, Jr., Presiding

CV368127

Joun J. HART,

plaintiff respondent

vs.

STOCKMAR ENERGY, INC., ef al.,

defendant ‘appellant

APPEAL FROM MUNICIPAL COURT

RULING ON SUBMITTED MATTER

The above entitled matter came on for oral argument

on August 21, 1992. The matter was argued and the

Court took the matter under submission. The Court now

makes the following ruling:

The judgment is reversed.

lla

APPENDIX C

SUPERIOR COURT

OF THE STATE OF CALIFORNIA

IN AND FOR THE COUNTY OF SACRAMENTO

Dept. No.: 21

October 13, 1992

JupGe ANTHONY DeCRrisToForoO, JR., Presiding

CV 368127

JouN J. Hart,

plaintiff /respondent

vs.

STOCKMAR ENFRGY, INC., et al.,

ey defendant/appellant

APPEAL FROM MUNICIPAL COURT

RULING ON PETITION FOR REHEARING

The petition for rehearing is granted. The new deci-

sion is the following:

Plaintiff's claim for penalties under Labor Code sec-

tions 201 and 203 is barred by Labor Code section 229

and preempted by section 301 of the Labor Management

Relations Act (29 U.S.C., § 185.)

The judgment is reversed and the trial court is di-

rected to enter judgment for defendant.

12a

APPENDIX D

No. S030678

IN THE SUPREME COURT

OF THE STATE OF CALIFORNIA

IN BANK

JOHN J. HART,

Petitioner

Vv.

SUPERIOR COURT OF THE STATE OF CALIFORNIA

IN AND FOR THE COUNTY OF SACRAMENTO

APPELLATE DEPARTMENT,

Respondent

STOCKMAR ENERGIE, INCORPORATED, et al.,

Real Party in Interest

[Filed Jan. 15, 1993]

The above entitled matter is transferred to the Court

of Appeal, Third Appellate District.

/s/ Mosk,

Acting Chief Justice

13a

APPENDIX E

IN THE COURT OF APPEAL

OF THE STATE OF CALIFORNIA

IN AND FOR THE THIRD APPELLATE DISTRICT

3 Civil CO15086

Sacramento CV368127

JOHN J. HART,

Petitioner

VS.

SUPERIOR COURT, SACRAMENTO COUNTY,

Respondent

STOCKMAR ENERGIE, INC.,

Real Party In Interest

[Filed Jan. 28, 1993]

By the Court:

The petition for writ of mandate is denied.

Dated: January 28, 1993

BLEASE,

Acting P.J.

14a

APPENDIX F

Third Appellate District No. C015086

$031138

IN THE SUPREME COURT

OF THE STATE OF CALIFORNIA

IN BANK

JOHN J. HART,

Petitioner

Vv.

SACRAMENTO COUNTY SUPERIOR COURT,

Respondent

STOCKMAR ENERGIE INCORPORATED,

Real Party In Interest

[Filed Mar. 17, 1993]

Petition for review DENIED.

/s/ Mosk

Acting Chief Justice