Rymel v. Save Mart Supermarkets, Inc.

Rymel alleges he suffered an industrial injury to his back and was out on workers' compensation leave. Because he needed to return to work for financial reasons his doctor lifted his work restrictions. He found it hard to work and asked to be moved to a different position but received no reply. He was forced to perform degrading tasks and work on the cold side of the warehouse, which aggravated his back condition. When he complained he was told to go to an emergency room and have new work restrictions imposed, an impractical solution. When he complained about unduly narrow aisles, he was forced to wear a degrading safety vest. A manager taunted him with questions about his medical condition. Ultimately, Rymel was told he could not work until he was completely healed. Rymel alleges statutory theories of medical condition discrimination, harassment, and retaliation, failure to engage in an interactive process to accommodate, failure to accommodate, and failure to take steps to prevent harassment, discrimination, and retaliation, as well as termination in violation of public policy (set by FEHA and the workers' compensation laws).

Motions to Compel Arbitration

In each case Save Mart moved to compel arbitration, citing the California Arbitration Act (CAA) ( Code Civ. Proc., § 1280 et seq. ) the Federal Arbitration Act (FAA) ( 9 U.S.C. § 1 et seq. ) and the federal Labor Management Relations Act,

of the CBA. Plaintiffs argued that their claims do not rely on the CBA. The trial court denied the motions to compel, finding Save Mart had not shown a valid arbitration provision covering the disputed claims existed, and plaintiffs had not waived their right to sue for state statutory claims. The trial court did not explicitly address preemption. Save Mart addresses only preemption in its initial briefing.

which claims of violation will be subject to arbitration"]; Choate , supra , 215 Cal.App.4th at p. 1467, 155 Cal.Rptr.3d 915 [to effect a waiver the CBA "must be specific, and mention either the statutory protection being waived or, at a minimum, the statute itself"]; Vasquez , supra , 80 Cal.App.4th at pp. 432, 434-436, 95 Cal.Rptr.2d 294 [similar holding where employee alleged FEHA and ADA claims and the relevant CBA did not mention those statutes]; Deschene v. Pinole Point Steel Co. (1999) 76 Cal.App.4th 33 , 41-49, 90 Cal.Rptr.2d 15 [no preemption of claims of wrongful termination based on medical condition under FEHA and retaliation for adverse testimony under Labor Code, § 230 ]; Ackerman v. Western Electric Co . (9th Cir. 1988) 860 F.2d 1514 , 1517 [the statutory right not to be discriminated against because of physical handicap or medical condition is defined and enforced under state law without references to the CBA].)

Not all work-related state law tort claims avoid section 301 preemption. For example, in Chmiel v. Beverly Wilshire Hotel Co . (9th Cir. 1989) 873 F.2d 1283 , the employee in part brought common law claims of wrongful termination and breach of contract. In effect, he claimed that he was entitled to greater employment protection than provided by the CBA, therefore, because "Chmiel's independent contract claim concerns a job position governed by the [CBA], it is completely preempted by section 301. [Citation.]" ( Id . at p. 1286.) Similarly, Chmiel's tort claims based on breach of the implied covenant and fair dealing and intentional infliction of emotional distress were preempted because they placed in issue the terms of the CBA. (See ibid . ) However, his statutory age discrimination claim was not preempted, because the relevant statute set forth "a nonnegotiable right" that applied "to both unionized and nonunionized workers. [Citation.]" ( Ibid . ) In other words, it was not dependent on or connected to the relevant CBA. (Cf. Cortez v. Doty Bros. Equipment Co . (2017) 15 Cal.App.5th 1 , 13-14, 222 Cal.Rptr.3d 649 [CBA clearly and unmistakably covered grievances over wage order]; Ruiz v. Sysco Food Services (2004) 122 Cal.App.4th 520 , 529-531, 18 Cal.Rptr.3d 700 ( Ruiz ) [common law defamation and related torts required interpretation of the CBA and therefore were arbitrable].)

In Cramer v. Consol. Freightways, Inc. (9th Cir. 2001) 255 F.3d 683 , an employer installed cameras in bathrooms behind two-way mirrors to detect

jobsites and back again. ( Id . at pp. 1055, 1058 ) Their CBAs included rules about shift length, overtime, and compensation for transportation. ( Id . at pp. 1056-1057.) But state law set out other rules for determining the compensability of such time. ( Id . at pp. 1060-1061.)

Burnside held the claims were not preempted. First, the claims were based on state laws independent of the CBA. (See Burnside, supra , 491 F.3d at pp. 1060-1070.) Next, the claims did not substantially depend on the CBA. Although the CBA set out detailed work rules; even if state law and the CBA had parallel provisions requiring interpretation that did not mean the state law claims depended on the CBA. (See id . at p. 1072 ; see also Moreau v. San Diego Transit Corp. (1989) 210 Cal.App.3d 614 , 623, 258 Cal.Rptr. 647 ["A mere overlapping of protections or terms found in both a [CBA] and state law does not necessarily require preemption"].) Finally, the fact that ascertainment of damages might require consulting the CBA did not suffice to show preemption, because merely looking at the CBA to determine the appropriate wage rate would not interpret the CBA. (See Burnside , at pp. 1073-1074.)

A defense must require interpretation of the CBA before preemption will be found. "Although the plaintiff cannot avoid preemption by 'artfully pleading' the claim [citation], the claim must ' require interpretation ' of the [CBA]. ... Preemption occurs when a claim cannot be resolved on the merits without choosing among competing interpretations of a [CBA] and its application to the claim." ( Sciborski , supra , 205 Cal.App.4th at pp. 1164-1165, 140 Cal.Rptr.3d 808 .)

Save Mart argues it fired Hagins for repeatedly violating production norms endorsed by the CBA and the custom and practice between the union local and Save Mart, and that it followed all progressive discipline rules set forth therein, and makes similar claims as to the other plaintiffs. If proven, these points could well provide Save Mart with solid defenses. But the CBA does not have to be interpreted to make out these defenses, it merely needs to be consulted , or viewed. (See Kobold , supra , 832 F.3d at p. 1033.)

Save Mart asserts that Rymel's and Roble's FEHA claims are based on the application of work rules under the CBA, legitimate request for medical documentation as provided by the CBA and governing customs, or neutral (grievable) rules about modified work duties. But again, claims that Save Mart acted with an improper motive do not depend on interpreting the CBA.

The two cases Save Mart appears to rely on most heavily prove inapposite and unpersuasive. Ruiz , supra , 122 Cal.App.4th 520 , 18 Cal.Rptr.3d 700 involved common law claims, not statutory claims. Ruiz was fired but then reinstated through a grievance under the relevant CBA; he then sued his employer for defamation and related torts based on "the employer's conduct during the investigation and interviews ... and subsequent notification of the police of alleged false accusations." ( Id . at pp. 524, 529, 18 Cal.Rptr.3d 700 .) The relevant CBA required the employer to investigate the matter, and Ruiz held the claims raised were necessarily intertwined with that investigation. ( Id . at p. 530, 18 Cal.Rptr.3d 700 .) The cases here are nothing like Ruiz .

Evangelista v. Inlandboatmen's Union of Pacific (9th Cir. 1985) 777 F.2d 1390 is even further afield. There the employee was suing because a

arbitration process established by the [CBA].' [Citation.]" ( Ruiz , supra , 122 Cal.App.4th at p. 529, 18 Cal.Rptr.3d 700 .) Ruiz was quoting from Tellez v. Pacific Gas and Elec. Co., Inc . (9th Cir. 1987) 817 F.2d 536 at p. 538. It appears the infringement language was first used casually by Tellez and was interpreted by Ruiz and a federal district court ( Riggs v. Continental Baking Co . (N.D. Cal. 1988) 678 F.Supp. 236 , 238 ) as if there were a separate infringement test. A treatise also quotes that part of Tellez , albeit with no analysis. (See 2 Advising Cal. Employers and Employees (Cont.Ed.Bar 2018) Mediation and Arbitration of Employment Disputes, § 20.34.) Save Mart does not clearly explain the test for purported infringement, nor does Save Mart explain how it would be functionally different from the other ways to determine whether allowing a civil suit to

Plaintiffs Jose Robles, Christopher Rymel, and David Hagins sued defendant Save Mart Supermarkets, Inc., alleging various state law statutory employment claims. After successfully moving to sever, Save Mart moved to compel arbitration as to each plaintiff. The motions were heard

together, and the trial court denied the motions by substantively identical orders. Save Mart timely appealed in each case. The appeals lie. (See Code Civ. Proc., § 1294, subd. (a).) We consolidated the appeals for oral argument and decision and shall affirm the orders denying the motions to compel arbitration.

BACKGROUND

Generally, a collective bargaining agreement (CBA) providing for arbitration of

section 301. Save Mart alleged plaintiffs were members of Teamsters Local 150 and were employed by Save Mart under a CBA that covered the pleaded disputes. Save Mart argued that resolving the disputes would require interpretation of the CBA or would be "substantially dependent" on such interpretation, that the claims were "inextricably intertwined" with parts of the CBA, and that judicial resolution of them would infringe on the arbitration process set forth in the CBA. The CBA was tendered as an exhibit. Article 21 addresses arbitration of grievances.

As for Robles, Save Mart contended his allegations "are based largely on (1) the tasks and schedules he has been assigned to by his employer, (2) his employer's requirement for doctor's notes in response to his complaints of injury, (3) his employer's requirements to wear safety gear, and (4) a three-day suspension he was given pursuant to the strictures of his [CBA]." Save Mart alleged its defense would be that its challenged actions were governed by the CBA, prior practices between Save Mart and the Teamsters, and Save Mart's reserved management rights under the CBA. Save Mart made analogous contentions about the complaints filed by Rymel and Hagins.

Save Mart's motions included meet-and-confer e-mails wherein plaintiffs' counsel cited Mendez v. Mid-Wilshire Health Care Center (2013) 220 Cal.App.4th 534 , 163 Cal.Rptr.3d 80 ( Mendez ) and Vasquez v. Superior Court (2000) 80 Cal.App.4th 430 , 95 Cal.Rptr.2d 294 ( Vasquez ) to argue that Save Mart could not rely on the CBA to compel arbitration of FEHA claims. Save Mart did not reply with contrary authority nor did it offer any factual or other basis for distinguishing these two cases.

Plaintiffs opposed the motions, in part citing Vasquez and Mendez (which we discuss post ) and arguing the pleaded claims did not fall within the scope of the CBA. They also cited Wright v. Universal Maritime Service Corp . (1998) 525 U.S. 70 , 119 S.Ct. 391 , 142 L.Ed.2d 361 ( Wright ) and argued that to overcome the presumption that statutory violations are not arbitrable, a CBA must be explicit on that point.

At the hearing on the motions, Save Mart argued that preemption analysis under section 301 was independent of the analysis required under the FAA and CAA and was unrelated to the arbitration provision

DISCUSSION

Legal Background

The parties agree that the CBA does not explicitly refer to FEHA, the whistleblower statute, and the California workers' compensation laws; the CBA is silent on the California statutes plaintiffs contend Save Mart violated.

To be valid, an arbitration agreement must reflect the mutual intention of the parties that disputes between them will be resolved out of court; in doing so it operates as a waiver of the right to sue for redress of grievances. A party is not generally compelled to arbitrate a claim unless she has agreed to do so; arbitration is conducted by consent. (See, e.g., AT&T Technologies v. Communications Workers (1986) 475 U.S. 643 , 648, 106 S.Ct. 1415 , 89 L.Ed.2d 648 ; Pinnacle Museum Tower Assn. v. Pinnacle Market Development (US), LLC (2012) 55 Cal.4th 223 , 236, 145 Cal.Rptr.3d 514 , 282 P.3d 1217 .)

A CBA is an agreement between an employer and a union and thus may be construed to waive the rights of union members even without explicit, individual consent of each member. But such a waiver, if applied to statutory rights, must be " 'clear and unmistakable.' [Citation.]" ( Wright , supra , 525 U.S. at p. 80, 119 S.Ct. 391 ; see Vasserman v. Henry Mayo Memorial Hospital (2017) 8 Cal.App.5th 236 , 239, 213 Cal.Rptr.3d 480 ["The [CBA] here required arbitration of claims arising under the agreement, but it did not include an explicitly stated, clear and unmistakable waiver of the right to a judicial forum for claims based on statute"]; Choate v. Celite Corp. (2013) 215 Cal.App.4th 1460 , 1465, 155 Cal.Rptr.3d 915 [a CBA "waives a union member's right to litigate ... in a judicial forum only if the waiver is clear and unmistakable"] ( Choate ).)

Ordinarily, a CBA cannot be invoked to bypass state law statutory protections. "When liability is governed by independent state law, 'the bare fact that a [CBA] will be consulted in the course of state-law litigation' " is not sufficient to invoke preemption under section 301. ( Sciborski v. Pacific Bell Directory (2012) 205 Cal.App.4th 1152 , 1164, 140 Cal.Rptr.3d 808 ( Sciborski ), quoting Livadas v. Bradshaw (1994) 512 U.S. 107 , 124, 114 S.Ct. 2068 , 129 L.Ed.2d 93 [reviewing cases and holding "These principles foreclose even a colorable argument that a claim under [California] Labor Code § 203 was pre-empted here"].)

Numerous California and Ninth Circuit cases have applied this rule to hold that claims under FEHA and similar remedial state statutes are not

preempted by section 301 and therefore are not subject to arbitration under a CBA. This body of case law includes Mendez and Vasquez , the two cases plaintiffs' counsel cited in its meet and confer letters and to the trial court. (See, e.g., Mendez , supra , 220 Cal.App.4th at p. 544, 163 Cal.Rptr.3d 80 [CBA did not require arbitration of FEHA claims; "It does not mention FEHA, it does not explicitly incorporate by reference any statutory antidiscrimination laws, and it does not contain an explicit waiver of the right to seek judicial redress for statutory discrimination causes of action"]; id . at p. 546, 163 Cal.Rptr.3d 80 ["At a minimum, the agreement must specify the statutes for

drug use, a misdemeanor violation of California law. Employees sued for invasion of privacy. The employer removed the matter to federal court and argued the claims were preempted by section 301 because their resolution required interpretation of the CBA. ( Id. at pp. 688-689.) The Cramer court explained that "states may provide substantive rights to workers that apply without regard to a CBA; a state court suit seeking to vindicate these rights is preempted only if it 'requires the interpretation of a [CBA].' " ( Id. at p. 690, italics added.) The fact that the CBA referenced drug testing and surveillance did not insulate the employer from state law liability, but was merely an effort to use the CBA as a defense and thereby " 'transform' " a state law suit into a federal case. ( Id . at p. 694.) But under "settled Supreme Court precedent, '§ 301 does not grant the parties to a [CBA] the ability to contract for what is illegal under state law.' [Citation.]" ( Id . at p. 695.)

In Burnside v. Kiewit Pacific Corp . (9th Cir. 2007) 491 F.3d 1053 ( Burnside ), class members alleged violations of California statutes and regulatory orders after their employer failed to pay them for the time spent traveling from meeting sites and

B. Preemption of the Claims

Save Mart next contends that every single claim of each plaintiff herein is preempted by section 301. This position is incorrect and ignores binding precedent.

1. Test for Preemption

The Ninth Circuit "has articulated a two-step inquiry to analyze § 301 preemption of state law claims. First, a court must determine 'whether the asserted cause of action involves a right conferred upon an employee by virtue of state law, not by a CBA. If the right exists solely as a result of the CBA, then the claim is preempted, and [the] analysis ends there.' [Citation.] If the court determines that the right underlying the plaintiff's state law claim(s) 'exists independently of the CBA,' it moves to the second step, asking whether the right 'is nevertheless "substantially dependent on analysis of a [CBA]." ' [Citation.] Where there is such substantial dependence, the state law claim is preempted by § 301. If there is not, then the claim can proceed under state law." ( Kobold v. Good Samaritan Regional Medical Center (9th Cir. 2016) 832 F.3d 1024 , 1032-1033, fn. omitted ( Kobold ).)

As we have set forth in Part I, ante , when determining independence from the CBA, the courts focus on the legal character of the claim rather than the underlying set of facts. The question is whether the claim can be resolved by looking to the CBA without the need for interpretation of the CBA. " '[I]n the context of § 301 complete preemption, the term "interpret" is defined narrowly-it means something more than "consider," "refer to," or "apply." ' [Citation.] And, notably, 'a defendant cannot, merely by injecting a federal question into an action that asserts what is plainly a state law claim, transform the action into one arising under federal law.' " ( Kobold, supra , 832 F.3d at p. 1033.)

2. Analysis

All of plaintiffs' claims here are based on nonnegotiable state law policies against medical condition discrimination and related torts (under FEHA), whistleblower retaliation (under Lab. Code, § 1102.5 ), and discipline in violation of public policies set by positive law (here, FEHA and the workers' compensation statutes).

Plaintiffs' primary claims are that Save Mart violated FEHA by not accommodating their medical conditions. Although the CBA might address things like work assignments and scheduling, which could potentially be relevant in a FEHA suit, the CBA would not have to be interpreted in order

to reference this information. Nor could the CBA possibly permit Save Mart to violate FEHA by making (or denying) work assignments because of an employee's medical condition, rather than for neutral business reasons. (See Matson v. United Parcel Service, Inc. (9th Cir. 2016) 840 F.3d 1126 , 1133-1134 ( Matson ) ["Put differently, Matson's contention is not that UPS created a hostile work environment

grievance proceeding initiated by another employee resulted in her loss of seniority; she initiated a second grievance challenging the decision, to no avail. ( Id . at pp. 1393-1394.) She sued, in part alleging wrongful discharge, interference with economic advantage and inducing breach of contract. ( Id . at pp. 1394, 1400.) Her claims were ruled preempted by section 301 because they hinged on whether the relevant CBA authorized the seniority decision or implicated her union's duty to fairly represent her. ( Id . at p. 1401.) The Ninth Circuit pointed out that "Evangelista does not allege that her reduction in seniority interferes with any independent state public policy." ( Ibid . ) Evangelista does not help Save Mart, because here plaintiffs do allege violations of independent state public policies.

Accordingly, none of the plaintiffs' claims are preempted.

C. Infringement

Finally, Save Mart contends that allowing any of plaintiffs' claims to proceed would "infringe" on the arbitration grievance process set out in the CBA. Save Mart explains that the CBA establishes a for-cause disciplinary scheme with strict procedural safeguards for employees, and argues that allowing these civil tort suits to go forward would frustrate those protections. Save Mart speculates that if any plaintiff succeeded in court, he might leverage that finding to argue the "just cause" provision of the CBA was violated even if both the union local and Save Mart agreed the discipline at issue was appropriate, thereby exposing Save Mart to liability under the CBA by effectively bypassing its arbitration grievance procedures.

Save Mart cites Ruiz to argue that if an employee's claims do not require interpretation of the CBA, "the court must determine whether permitting the state law claims to proceed would infringe upon the