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Make Sure to Review Federal Exemptions When Fighting Class Actions in CA

February 29, 2012

Countless employers have now been faced with class action litigation, making claims for various deviations from the California Labor Code. Many times employers will face these head on with evidence that the claims made by one former employee are not sufficiently common to a substantial number of other past and current employees to merit class action treatment. Other times, employers argue the plaintiff’s allegations don’t demonstrate a uniform set of facts such that the Court would be able to decide a single legal question that would be applicable to an entire class. However, before dealing with these issues head on, California employers should always look beyond our borders to see if Federal law preempts the California Labor Code.

The scourge of California class actions is one factor that has led many employers to be driven from our state’s shores, valleys, and mountains. However, what if your job is to drive into or within California? This is the case faced by many employers in the transportation industry.

Last year, the Ninth Circuit in Am. Trucking Ass’ns, Inc. v. City of Los Angeles (ATA II), 660 F.3rd 384 (2011), and the Southern District of California in Dilts v. Penske Logistics LLC, paved a new highway for California’s transportation companies dealing with meal and rest class actions involving their route drivers. Traveling down this same road, the Central District of California has recently dismissed a putative class action brought by a group of route delivery drivers against Vistar Corp. in Esquivel v. Vistar Corp. dba Roma Food and dba Performance Food Group., Central District of California Case No. 2:11-cv-07284-JHN-PJWx.

In Esquivel the plaintiff route drivers claimed that throughout their employment, their transportation company employer scheduled their delivery routes in such a way so as to prevent them from taking duty-free meal breaks. The plaintiff route drivers also claimed that the time pressures involved in making deliveries by a certain time of day also prevented them from taking breaks. Many customers require that deliveries be done during few specific hours. The plaintiffs attempted to capitalize on this customer requirement to force liability on their employer.

Vistar Corp. moved to dismiss the case on the grounds that the plaintiffs’ claims were preempted by the Federal Aviation Administration Authorization Act (“FAAAA”), 49 U.S.C. § 14501 et seq. The Court agreed and dismissed the case, finding the reasoning in Dilts applicable and persuasive. The Court pointed out that in Dilts, “‘the length and timing of meal and rest breaks seems directly and significantly related to such things as the frequency and scheduling of transportation,’ such that requiring off-duty breaks ‘at specific times throughout the workday . . . would interfere with competitive market forces within the . . . industry.” (quoting Dilts, 2011 WL 4975520 at *9.)

The plaintiffs attempted to argue that the FAAAA does not preempt California’s meal and rest break laws. In support of this failed notion, the citing to various state and federal cases, which the Court found were either “fundamentally distinguishable” from cases involving meal and rest break laws or unpersuasive because they predated ATA II and Dilts. The plaintiffs further argued that Dilts was an “outlier decision” and was “wrongly decided”, but the Court disagreed, finding that Dilts applied a novel test enunciated by the Ninth Circuit in ATA II to cover a previously unanswered question regarding FAAAA preemption.

For motor carriers, this decision is welcome news in that it continues and solidifies the earlier decisions in ATA II and Dilts. For those outside the transportation industry, these cases serve as a great reminder that we should look beyond our state’s borders when addressing wage and hour liabilities to explore whether any Federal laws preempt the draconian California Labor Code provisions often used as the basis for class action litigation. Happy travels!