The Federal Court of Appeals, which oversees California cases, recently issued an opinion that provides guidance to employers trying to comply with collective agreements, while asking for potentially inconsistent definitions to be applied in California`s overtime law. The January 9 9 Decision at Curtis et al v. Irwin Industries, Inc. added a victory to the affected employer, but you shouldn`t necessarily think that this case offers you an automatic grace from state law in every situation. Keep reading to understand the nuances that are at stake and whether the federal pre-emption decision might work in order to clarify your California operations. It is known that the Federal FAIR Labor Standards Act (FLSA) takes precedence over any provision to the contrary in a collective agreement, to the extent that the agreement provides for less compensation than that prescribed by the FLSA. But what if the Wages and Hours Act is not the FLSA, but is found in state laws? The results seem to differ from one State to another as to the feasibility of a collective agreement, even if it provides for a lower compensation than that of a national law on wages and hours. This case offers several reminders to employers when negotiating collective agreements: the current collective agreement (“CBA”) stipulates that workers must use the compulsory claims and arbitration procedure to resolve malfunctions defined in such a way as to encompass claims or disputes relating to remuneration. The company dismissed the complaint on the grounds that the complainant had not exhausted the CBA appeal procedure before his appeal was filed.
The U.S. District Court of the Northern District of Illinois accepted the company`s position and rendered a ruling in favor of the company. The court first noted that California`s Overtime Act, Section 510 of the Labor Code, expressly provides that “the requirements of this section do not apply to the payment of overtime pay to an employee who, in accordance with. [a] n alternative weekly hours adopted in accordance with a collective agreement provided for in Article 514. Section 514 exempts an employer from California`s overtime laws when a CBA “explicitly provides for workers` wages, hours of work, and working conditions and if the agreement provides bonus rates for all overtime worked and a normal hourly wage for such employees no less than 30 percent more than the state minimum wage.” The Tribunal held that if, in this case, the BCAs meet the requirements of the Section 514 Labour Code, Curtis` right to overtime is exclusively within the CBA and is therefore prefabricated. . . .