Opinion
G044777 Super. Ct. No. 30-2010-00391385
12-09-2011
DONALD HUDSON, JR., et al., Plaintiffs and Respondents, v. NATIONAL READY MIXED CONCRETE COMPANY, Defendant and Appellant.
Atkinson, Andelson, Loya, Rudd & Romo, Steven D. Atkinson, Robert R. Roginson, Barbara S. Van Ligten and Ronald W. Novotny for Defendant and Appellant. James Hawkins, James R. Hawkins, Gregory E. Mauro and Alvin B. Lindsay for Plaintiffs and Respondents.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
OPINION
Appeal from an order of the Superior Court of Orange County, Kim Garlin Dunning, Judge. Affirmed.
Atkinson, Andelson, Loya, Rudd & Romo, Steven D. Atkinson, Robert R. Roginson, Barbara S. Van Ligten and Ronald W. Novotny for Defendant and Appellant.
James Hawkins, James R. Hawkins, Gregory E. Mauro and Alvin B. Lindsay for Plaintiffs and Respondents.
Defendant National Ready Mixed Concrete Company appeals from the denial of its motion to compel arbitration of the class action complaint filed by plaintiff Donald Hudson, Jr., for various alleged wage and hour violations arising almost exclusively out of the Labor Code and various wage orders. Defendant's motion was based on arbitration provisions contained in collective bargaining agreements to which it was a party. Defendant argues the collective bargaining agreements specifically require plaintiffs' claims to be arbitrated. We disagree and affirm.
FACTS AND PROCEDURAL HISTORY
Plaintiff Hudson was employed as a truck driver by defendant between June and October 2006. Defendant is a party to two collective bargaining agreements with various Locals of the International Brotherhood of Teamsters (union) with effective dates of July 1, 2004 to June 30, 2007 (2004 agreement) and July 1, 2007 to June 30, 2010 (2007 agreement). The agreements spell out the method of calculating overtime pay and the 2004 agreement sets out the time for lunch, while the 2007 agreement states lunch and break times.
The agreements each contain a paragraph entitled "Wage Order" (bold and underscoring omitted), which states: "The parties to this [a]greement recognize and agree that Industrial Wage Order 16-2001 (Wage Order 16) covers [defendant's] operation and recognize the applicability of and incorporate the provisions of [Wage Order 16], or any Industrial Welfare Commission wage order determined to be applicable to work performed under this [a]greement. An alleged violation of any applicable wage order or claims for damages thereunder[] shall be resolved exclusively under and in accordance with the procedure for settlement of grievances and disputes set forth in this [a]greement." This paragraph in the 2004 agreement contains some additional language not relevant to the issue before us.
The agreements also include a procedure to resolve grievances, which designates arbitration as the ultimate step in the process.
In 2010 plaintiff filed an action on behalf of himself and other members of the class. Although the general allegations state the complaint was filed pursuant to 12 enumerated sections of the Labor Code and California Code of Regulations, Title 8, section 11000 et seq., which contain wage orders, each cause of action designated the specific Labor Code sections or wage orders on which it was based. The claim for failure to pay hourly and overtime wages relied on "Labor Code violations." The count alleging failure to provide periods for rest or meals or payment in lieu of them relied on both Labor Code sections and wage order 1 or 9 or both. The third cause of action for failing to timely pay wages at termination relied solely on three Labor Code sections. The count for failing to maintain itemized wage statements made reference to three specific Labor Code sections and wage orders in general. The final cause of action alleged unfair competition in violation of Business and Professions Code section 17200, based on some of the same conduct as alleged in other causes of action.
Defendant moved to compel arbitration of the entire action. The court's rationale for denying the motion, expressed during the hearing, was: "You've got an arbitration agreement that specifically references . . . Wage Order 16, right? I don't believe the court has been presented with any authority that says a wage order is the equivalent of a statute. That seems to be kind of a significant issue. If you were talking about a statute instead of a wage order it would be a completely different analysis, but we're only talking about a wage order. It doesn't really rise to the . . . dignity, or the gravitas . . . that a statute would."
DISCUSSION
1. No Waiver of Trial
Defendant argues that California case law allows the union to waive plaintiffs' right to a jury trial for alleged violations of Labor Code sections and wage orders as long as the waiver is "'clear and unmistakable.'" In support it relies on three cases, Vasquez v. Superior Court (2000) 80 Cal.App.4th 430, 434-435, Cicairos v. Summit Logistics, Inc. (2005) 133 Cal.App.4th 949, 960, and Flores v. Axxis Network & Telecommunications, Inc. (2009) 173 Cal.App.4th, 802, 808, all of which denied arbitration. It points out that the denials were based on the lack of a clear and unmistakable waiver or intent to waive. In our case, it claims, the waiver is unmistakable.
But other than a passing mention and an incorrect summary of its holding, defendant fails to cite Zavala v. Scott Brothers Dairy, Inc. (2006), 143 Cal.App.4th 585, which we conclude controls here. There, the plaintiff-employees sued the defendant for alleged violation of Labor Code sections 226 and 226.7 and certain wage orders based on failure to provide rest breaks and correctly itemized wage stubs, and for unfair business practices, claims similar to those in our case. The defendant petitioned to compel arbitration based on a collective bargaining agreement that required arbitration of all disputes "arising under" it. (Zavala v. Scott Brothers Dairy, Inc., supra, 143 Cal.App.4th at p. 588, italics omitted.) The agreement provided for coffee breaks and itemization of wage statements but not in the same language as the Labor Code and wage orders. (Ibid.)
In affirming denial of the petition the court held the arbitration provision did not bind the plaintiffs "because the [u]nion could not waive [the] plaintiffs' right to bring statutory labor-rights claims in court and because such claims did not arise under the [collective bargaining agreement]." (Zavala v. Scott Brothers Dairy, Inc., supra, 143 Cal.App.4th at p. 592.) It based much of its reasoning on Barrentine v. Arkansas-Best Freight System, Inc. (1981) 450 U.S. 728 [101 S.Ct. 1437, 67 L.Ed.2d 641] where truck drivers subject to a collective bargaining agreement with a provision requiring arbitration for "'"any controversy which might arise"'" (Zavala v. Scott Brothers Dairy, Inc., supra, 143 Cal.App.4th at p. 593, italics omitted) were not required to arbitrate claims based on alleged violations of statutes "'designed to provide minimum substantive guarantees to individual workers' [citation]" (ibid., italics omitted). "Rights under the [federal Fair Labor Standards Act] . . . 'are independent of the collective-bargaining process'" (ibid.) and "'these congressionally granted . . . rights are best protected in a judicial rather than in an arbitral forum . . .' [citation]" (ibid., fn. omitted).
Relying on 14 Penn Plaza LLC v. Pyett (2009) 556 U.S. 247 [129 S.Ct. 1456, 173 L.Ed.2d 398], defendant argues federal law allows a "'"clear and unmistakable"'" waiver of the right to trial (Livadas v. Bradshaw (1994) 512 U.S. 107, 125 [114 S.Ct. 2068, 129 L.Ed.2d 93]). In Penn Plaza, where the defendant-union members and the plaintiff, their employer, were parties to a collective bargaining agreement requiring arbitration of employment discrimination claims, the defendants sued for violation of the federal Age Discrimination in Employment Act of 1967 (ADEA). The court held "a collective-bargaining agreement that clearly and unmistakably requires union members to arbitrate ADEA claims is enforceable as a matter of federal law." (14 Penn Plaza LLC v. Pyett, supra, 556 U.S. at p. ___, 129 S.Ct. at p. 1474.) But federal law is not at issue here. Plaintiff's claims are based on state statutes and wage orders and on common law. And we see nothing in Penn Plaza that mandates its applicability to anything beyond the facts of the case, i.e., an action for violation of federally protected rights under the ADEA.
Rather, the reasoning in Zavala persuades us that, despite some ineffective language to the contrary in the agreements, plaintiffs have the right to litigate their wage order and statutory wage and hour claims in a court. (Zavala v. Scott Brothers Dairy, Inc., supra, 143 Cal.App.4th at pp. 593-594; see also Chin et al., Cal. Practice Guide: Employment Litigation (The Rutter Group 2010) ¶ 18:553, p. 18-61 [under Zavala, despite arbitration clause in collective bargaining agreement employees retained right to sue for wage claims].)
Moreover, even if we were to agree the right to try these claims could be waived, it was not done here. The only wage order specified in either agreement was Wage Order 16. There was a generalized reference to other wage orders that might be applicable. And there is no mention whatsoever of the Labor Code. Yet two of the four wage and hour claims in the complaint are based exclusively on the Labor Code and the other two rely on the Labor Code and wage orders, but neither of them specifically on Wage Order 16.
To determine if the waiver language is sufficiently clear "courts look to the generality of the arbitration clause, explicit incorporation of [specific] statutory . . . requirements, and the inclusion of specific [statutory] provisions." (Vasquez v. Superior Court, supra, 80 Cal.App.4th at p. 434.) "The test is whether a collective bargaining agreement makes compliance with the statute a contractual commitment subject to the arbitration clause. [Citations.]" (Id. at pp. 434-435.) "A simple agreement not to engage in acts violative of a particular statute will not suffice; the agreement must establish the intent of the parties to incorporate 'in their entirety' the . . . statutes. [Citation.] Compliance with a particular statute must be an express contractual commitment in the collective bargaining agreement." (Id. at pp. 435-436.) That is, there is a clear and unmistakable waiver only when the agreement makes compliance with a statute a contractual obligation and also provides that the contractual obligation is subject to the arbitration provision.
Here the agreements state only that the parties "recognize the applicability of and incorporate the provisions of Industrial Wage Order 16-2001, or any Industrial Welfare Commission wage order determined to be applicable to work performed . . . ." There is no explicit language making compliance with the Labor Code or wage orders a contractual requirement and thus no grounds for compelling arbitration.
2. Labor Code Section 229
Labor Code section 229 (section 229) declares: "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." The first sentence makes clear that despite an agreement to arbitrate unpaid wage claims, a plaintiff has the right to file suit.
In seeking to compel arbitration defendant points to the second sentence, arguing that plaintiffs' claims require the trial court to interpret and apply the provisions of the agreements, thus removing it from section 229's exemption. But there is nothing that needs to be applied or interpreted for plaintiffs' complaint to be resolved. Plaintiffs are relying on Labor Code sections and wage orders in support of their claims and defendant's duties arise from them, not the agreements. Thus, section 229 also protects plaintiffs' rights to litigate their claims for unpaid wages.
DISPOSITION
The order is affirmed. Respondents are entitled to costs on appeal.
RYLAARSDAM, ACTING P. J.
WE CONCUR:
O'LEARY, J.
IKOLA, J.