A California state appeals court has reversed a trial court and found that a group of security guard employees who brought wage and hour claims against the San Francisco Giants must pursue their claim through the arbitration process.
While the alleged statutory violation did not come within the scope of the contractual arbitration provision of the collective bargaining agreement (CBA) between the employer and the employees’ union, the appeals court found that federal preemption applied under § 301 of the federal Labor Management Relations Act, meant the dispute had to be resolved pursuant to the grievance procedure and arbitration under the CBA.
By way of background, the Giants play at AT&T Park in San Francisco, where the Giants play baseball games, and concerts and other events are staged during the off-season. Lead plaintiff George Melendez has been employed by the Giants as a security guard at AT&T Park since March 2005. As required by the terms of the CBA, he has at all times been a member of the union and the terms of his employment are governed by the provisions of the CBA.
The CBA confirms that the union is the sole collective bargaining agency for security personnel employed by the Giants at AT&T Park. The agreement defines several classifications of employees. “Regular” employees are the 13 employees who in 2012 worked the most total hours and who continue to work at least 1700 hours in succeeding years. These employees have priority in scheduling over other classifications of employees and receive benefits not provided to other employees. Any vacancy in these 13 positions “shall be filled by the person who worked the most hours in the previous year from among those employees not classified as ‘regular employees.’” All other employees (other than “supervisory” employees and “probationary” employees) are labelled “seasonal” employees. The CBA also defines “senior seasonal” employees (seasonal employees who have worked a minimum of 300 hours each year for the last five years) and “super senior seasonal” employees (seasonal employees who have worked a minimum of 300 hours each year for the last 10 years), who receive increased hourly wages.
All security personnel are required to meet specified employment qualifications. These qualifications include obtaining a valid California Guard Card, which requires “enrolling in and completing necessary coursework and training, passing the required examination, passing the required background check” and meeting any other applicable requirements. The CBA also provides that “All new applicants for employment as security personnel shall be subject to pre-hire drug screening and background investigation.” The Giants “have the right to discipline or discharge any regular, senior seasonal or seasonal employee for cause.” The term of the CBA is from January 1, 2013, through December 31, 2017, and from year-to-year thereafter unless either party requests modification 60 days prior to the anniversary date.
The CBA contains a schedule of hourly wages for all classifications of employees. The agreement provides that the Giants “retain the right to establish what shall constitute a normal workday and to schedule employees at its discretion.” All non-probationary employees “shall be entitled to overtime pay for Martin Luther King Jr. Day, President’s Day, Memorial Day, Fourth of July, Labor Day, Thanksgiving, Christmas & New Year’s Day.”
According to the Giants’ Senior Director of Security, “security guards do not turn in their uniforms or badges at the end of each homestand or baseball season.” They “do not reapply for work or submit new hire paperwork at the beginning of each homestand or baseball season. Nor do they have to undergo security background checks at the beginning of each homestand or baseball season. The Giants do not terminate their security guards at the end of each homestand or baseball season. On the contrary, security guards remain on the Giants’ payroll between homestands and baseball seasons, unless their employment otherwise ends (by resignation or pursuant to the CBA).” Many Giants’ security guards “regularly work between baseball seasons or year-round. … Based on review of his payroll records, [Melendez] himself regularly worked between baseball seasons. In fact, he worked every pay period in 2015 and each and every pay period in 2016 to date, often working almost as many hours in the ‘off-season’ as those during the baseball seasons.”
Without having invoked the grievance procedures specified in the CBA, the plaintiffs filed their complaints with common allegations. Melendez alleged that he and other security guards are hired by the Giants “intermittently during the baseball season and throughout the rest of the calendar year” and that the Giants fail to comply with Labor Code section 201 “in no less than three (3) ways. (1) At the end of the baseball season defendants do not pay intermittingly employed persons on the last day they work during the season. (2) During the baseball season, defendants do not immediately pay intermittently employed employees on the last day they work during a home-stand. (3) Between baseball seasons, when intermittently employed persons are employed for events such as concerts, college football games, theatrical performances, fan appreciation days, a run of Cirque du Soleil shows, etc., defendants do not immediately pay intermittently employed employees at the end of their work at these events.”
The Giants sought arbitration, pursuant to the CBA and section 301 of the LMRA. Then trial court denied the request and the Giants appealed.
The Court of Appeal reversed the order.
While it agreed with the trial court that the dispute did not come within the arbitration provisions of the CBA, the fact that it was based on an alleged violation of Lab. Code, § 201 implicated § 301 of the LMRA.
“The underlying legal issue was whether the employees were discharged within the meaning of Lab. Code, § 201,” according to the appeals court. “The duration of the employment relationship had to be derived from what was implicit in the CBA, and there were numerous provisions from which inferences as to the intended term of employment could logically be drawn. Thus, because application of Lab. Code, § 201, necessarily required the interpretation of the CBA and substantially depended upon analysis of its terms, federal preemption applied, and the dispute had to be resolved pursuant to the grievance procedure and arbitration under the CBA.”
George Melendez et al. v. San Francisco Baseball Associates LLC; Ct. App. Calif., 1st App. Dist.; A149482, 2017 Cal. App. LEXIS 899; 10/17/17
Attorneys of Record: (for plaintiff and respondent) Dennis F. Moss, Sahag Majarian II. (for defendant and appellant) Nancy Pritikin, Babak Yousefzadeh, Brian S. Fong of SHEPPARD, MULLIN, RICHTER & HAMPTON LLP.