Collins v. Overnite Trans. Co.

• Decision Date: 09 January 2003
• Docket Number: No. A097623.,A097623.
• Citation: 105 Cal.App.4th 171,129 Cal.Rptr.2d 254
• Court: California Court of Appeals Court of Appeals
• Parties: David COLLINS et al., Plaintiffs and Appellants, v. OVERNITE TRANSPORTATION COMPANY, Defendant and Respondent.

129 Cal.Rptr.2d 254

105 Cal.App.4th 171

David COLLINS et al., Plaintiffs and Appellants, v. OVERNITE TRANSPORTATION COMPANY, Defendant and Respondent.

No. A097623.

Court of Appeal, First District, Division 1.

January 9, 2003.

As Modified February 3, 2003.

Van Bourg, Weinberg, Roger & Rosenfeld, David A. Rosenfeld, San Diego, Esq., Lisa W. Pau, Esq., for Plaintiffs and Appellants.

Paul, Hastings, Janofsky & Walker LLP, Peter S. Rukin, Esq., M. Kirby C. Wilcox, Esq., San Francisco, for Defendant and Respondent.

SWAGER, J.

David Collins, Ed Lizarrago, and Mitch Moreno appeal a judgment dismissing their complaint for unpaid overtime compensation and other relief against their employer, Overnite Transportation Company (hereafter Overnite). We affirm.

PROCEDURAL BACKGROUND

Appellants are truck drivers employed by Overnite, a motor carrier. In a complaint filed in Alameda County Superior Court on May 3, 2001, they brought a class action on their own behalf and on behalf of other driver employees, seeking compensation for unpaid overtime pay and other relief. The complaint alleged several causes of action based on various violations of the Labor Code and Unfair Practices Act, which were each predicated on the theory that the Eight-Hour-Day Restoration and Workplace Flexibility Act of 1999 imposed new statutory liability on motor carriers relating to hours of service of their employees. Overnite filed a demurrer raising an exemption for motor carriers contained in wage order No. 9 of the Industrial Welfare Commission (IWC). In an order filed August 6, 2001, the trial court sustained the demurrer without leave to amend and subsequently filed a judgment on December 12, 2001, in favor of Overnite. Appellants filed a timely notice of appeal.

The appeal calls on us to review the pertinent exemption in wage order No. 9 of the IWC, the purpose and effect of EightHour-Day Restoration and Workplace Flexibility Act of 1999, and certain disputed language in Labor Code section 515, subdivision (b)(2).

DISCUSSION

A. Wage Order No. 9

"The IWC is a five-member appointive board initially established by the Legislature in 1913. For the first 60 years of its existence, the IWC's mission was to regulate the wages, hours and conditions of employment of women and children employed in this state, in furtherance of such employees' `health and welfare.' To this end, the commission—beginning in 1916— promulgated a series of industry and occupation-wide "wage orders,' prescribing various minimum requirements with respect to wages, hours and working conditions to protect the health and welfare of women and child laborers." (Industrial Welfare Com. v. Superior Court (1980) 27 Cal.3d 690, 700, 166 Cal.Rptr. 331, 613 P.2d 579.) "There was no similar state overtime requirement for adult male workers, although in 1938 those workers were covered by different overtime rules under the provisions of the federal Fair Labor Standards Act of 1938 (FLSA) (29 U.S.C. §§ 201-219)." (California Labor Federation v. Industrial Welfare Com. (1998) 63 Cal.App.4th 982, 986, 74 Cal.Rptr.2d 397.)

"In the early 1970s, a number of federal judicial decisions invalidated a substantial portion of the then-prevailing IWC wage orders on the ground that the limited application of such orders to women workers (and children) violated the prohibition on sex discrimination embodied in title VII of the federal Civil Rights Act of 1964. [Citations.] In response to these federal decisions, the California Legislature in 1972 and 1973 amended the applicable provisions of the Labor Code to authorize the IWC to establish minimum wages, maximum hours and standard conditions of employment for all employees in the state, men as well as women. [Citations.] The constitutionality of this legislative expansion of the IWC's jurisdiction to all California workers is explicitly confirmed by article XIV section 1 of the California Constitution . . .." (Industrial Welfare Com v Superior Court, supra, 27 Cal.3d 690, 700-701, 166 Cal.Rptr. 331, 613 P.2d 579; see also Bell v. Farmers Ins. Exchange (2001) 87 Cal.App.4th 805, 810, 105 Cal.Rptr.2d 59).

The expansion of its jurisdiction in the mid-1970's "did not alter the basic nature of the IWC's decision-making authority. . .." (Industrial Welfare Com. v. Superior Court, supra, 27 Cal.3d 690, 701, 166 Cal.Rptr. 331, 613 P.2d 579.) As noted by our high court, "Judicial authorities have repeatedly emphasized that in fulfilling its broad statutory mandate, the IWC engages in a quasi-legislative endeavor, a task which necessarily and properly requires the commission's exercise of a considerable degree of policy-making judgment and discretion." (Id. at p 702, 166 Cal.Rptr. 331, 613 P.2d 579.) In the exercise of this quasi-legislative power, the IWC has promulgated 15 wage orders, following a similar format, which each apply to separate industries or occupations. (See Morillion v. Royal Packing Co. (2000) 22 Cal.4th 575, 581, 94 Cal.Rptr.2d 3, 995 P.2d 139; Cal.Code Regs., tit. 8, § 11000 et seq.) Wage order No. 9 applies to the transportation industry. (See Cal. Code Regs., tit. 8, § 11090.)

Wage order No. 9-76, the first wage order promulgated for the transportation industry under the IWC's present jurisdiction, provided that the state regulation of hours of service did not apply to "employees whose hours of service are regulated by the United States Department of Transportation Code of Federal Regulations, Title 49, Sections 395.1 to 395.13, Hours of Service of Drivers." (See wage order No. 9-76, subd. 3(1).) The cited regulations form part of the Federal Motor Vehicle Safety Standards (49 C.F.R. § 371 et seq. (2001)) and establish a unique regulatory scheme regulating the driving hours of truck drivers, which is designed to balance safety considerations against the demands of the trucking industry. They exist under statutory authority for the regulation of motor vehicle safety (49 U.S.C. § 31501(b)(1)), which has a pedigree going back to the Motor Carrier Act, 1935. (49 Stat. 543, 546.) Those motor carrier employees, whose hours of service are regulated by this set of safety standards, have always been exempted from the coverage of the federal Fair Labor Standards Act of 1938. (See 29 U.S.C. § 213(b)(1), Pub.L. No. 718 (June 25, 1938) and 52 Stat. 1068.)

Subsequent revisions of wage order No. 9, reflected in wage order Nos. 9-80 and 9-90, retained this exemption based on Federal Motor Vehicle Safety Standards and added a reference to a parallel set of California regulations in title 13, California Code of Regulations, subchapter 6.5, governing the maximum driving and on-duty time of truck drivers. (See wage order No. 9-80, subd. 3(1) and wage order No. 9-90, subd. 3(H).) As in effect during 1997, wage order No. 9-90, subdivision 3(H), provided: "The provisions of this section are not applicable to employees whose hours of service are regulated by (1) the United States Department of Transportation Code of Federal Regulations, title 49, sections 395.1 to 395.13, Hours of Service of Drivers, or (2) Title 13 of the California Code of Regulations, subchapter 6.5, section 1200 and following sections, regulating hours of drivers." An identical exemption is contained in 11 other wage orders covering industries that may involve use of motor carriers.¹

B. Eight-Hour-Day Restoration and Workplace Flexibility Act of 1999

The Eight-Hour-Day Restoration and Workplace Flexibility Act of 1999 (hereafter Act) was in large measure a response to the IWC's amendment of five wage orders on April 11, 1997, which, among other things, eliminated the state's daily overtime rule in favor of the less restrictive weekly overtime rule of the federal FLSA. Prior to amendment, the IWC wage orders established a rule requiring payment of overtime for more than eight hours of work in a day; the FLSA required payment of overtime for hours worked beyond 40 hours in a week. (See California Labor Federation v. Industrial Welfare Com., supra, 63 Cal.App.4th 982, 986-989, 74 Cal.Rptr.2d 397.) These amendments, which were effective January 1, 1998, applied to the wage orders covering manufacturing; professional, clerical, mechanical and similar occupations; public housekeeping industry; mercantile industry; and transportation industry.²

Section 21 of the Act declared the five wage orders, as amended effective January 1, 1998, to be null and void and reinstated the earlier wage orders that were in effect during 1997.³ Other portions of the Act established a new statutory scheme governing hours of labor and overtime compensation for all industries and occupations, which codified certain provisions of IWC wage orders, amended other provisions, and added a series of new options for alternative workweeks. The alternative workweek provisions do not concern this appeal. It is important to note, however, that Labor Code section 510 constitutes the key provision in this new statutory scheme. As amended by the Act, section 510 now states the general eight-hour-day rule that was earlier contained only in wage orders. Subdivision (a) of section 510 provides in part: "Eight hours of labor constitutes a day's work. Any work in excess of eight hours in one workday and any work in excess of 40 hours in any one workweek and the first eight hours worked on the seventh day of work in any one workweek shall be compensated at the rate of no less than one and one-half times the regular rate of pay for an employee."

C. Labor Code section 515, subdivision (b)(2)

Appellants contend that, with respect to truck drivers in their class, the Act eliminated the exemption for motor carriers contained in past wage orders and brought them within the overtime rules of Labor Code section 510 and other pertinent provisions of the Act. Each of their causes of action alleges violations of the Act, which necessarily assumes that appellants are no longer within the motor carrier exemption. Their ...