Curry et al v. Kraft Foods Global, Inc.
Filing
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MEMORANDUM Opinion and Order Signed by the Honorable Virginia M. Kendall on 1/12/2012.(tsa, )
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
CHRISTINE CURRY, TODD SCHILTZ,
ANTHONY THOMPSON, DAVID LENOCI,
THOMAS SHERIDAN, TERRY T. GIBSON,
MARGARET KEY, FELIX KASKIE, ESTELA
DIEHL, and ROBERT KMIECIK, on behalf of
themselves and all others similarly situated,
Plaintiffs,
v.
KRAFT FOODS GLOBAL, INC.,
Defendant.
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Case No. 10 C 1288
Judge Virginia M. Kendall
MEMORANDUM OPINION AND ORDER
Plaintiffs Christine Curry, Todd Schiltz, Anthony Thompson, David Lenoci, Thomas
Sheridan, Terry T. Gibson, Margaret Key, Felix Kaskie, Estela Diehl, and Robert Kmiecik
(collectively “Plaintiffs”), on behalf of themselves and others similarly situated, brought this class
action suit against Kraft Foods Global, Inc. (“Kraft” or “Defendant”) for failing to pay Plaintiffs for
time spent donning and doffing protective equipment before and after their work shift. Plaintiffs
claim that Kraft violated the Illinois Minimum Wage Act (Count I) and the Illinois Wage Payment
and Collection Act (Count II). Plaintiffs move for the Court to remand the case to the Circuit Court
of DuPage County because the state wage claims are not preempted by federal law, and therefore this
Court does not have federal jurisdiction. For the reasons stated below, the Court denies Plaintiffs’
Motion to Remand.
BACKGROUND
Plaintiffs are employees of Kraft’s Naperville, Illinois facility. In performing their duties
they are required to wear personal protective equipment. It takes some time to put on and take off
the protective equipment at the beginning and end of the day. Plaintiffs claim that Kraft has not
counted the donning and doffing as part of their “Work Time.” Plaintiffs claim they are entitled to
receive payment for this “Work Time” and assert that Kraft is liable under two statutes: the Illinois
Minimum Wage Law (“IMWL”), 820 ILCS 105/1 et seq. and the Illinois Wage Payment and
Collection Act (“IWPCA”), 820 ILCS 115/1 et seq.
The issue is whether two federal
statutes—section 301 of the Labor Management Relations Act (“LMRA”) and section 203(o) of the
Fair Labor Standards Act (“FLSA”)—preempt these two state law claims. When the Plaintiffs
initially filed their Motion to Remand, there was a case pending in the Seventh Circuit, Spoerle v.
Kraft Foods Global, Inc., 614 F.3d 427 (7th Cir. 2010), involving issues similar to those in this case
so the Court stayed briefing until the Seventh Circuit decided Spoerle.
STANDARD OF REVIEW
A defendant can remove a case from state court to a federal district court if the district court
has original jurisdiction over the matter. 28 U.S.C. § 1441; Caterpillar Inc. v. Williams, 482 U.S.
386, 392 (1987). The party seeking removal has the burden of establishing federal jurisdiction. Brill
v. Countrywide Home Loans, Inc., 427 F.3d 446, 447 (7th Cir. 2005). After a case is removed, but
before the court renders a final judgment, if it “appears that the district court lacks subject matter
jurisdiction, the case should be remanded” back to state court. 28 U.S.C. § 1447(c). “When ruling
on a motion to remand, ‘[c]ourts should interpret the removal statute narrowly and presume that the
plaintiff may choose his or her forum,’ with any doubt resolved in favor of remand.” See, e.g.,
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Coake v. State Farm Ins. Co., 09-cv-353, 2010 WL 2545162, at *3 (N.D. Ind. May 28, 2010)
(quoting Doe v. Allied-Signal Inc., 985 F.2d 908, 911 (7th Cir. 1993)).
DISCUSSION
Plaintiffs’ Motion for Remand claims there is no preemption based on FLSA section 203(o)
or LMRA section 301. If neither of these federal statutes preempt Plaintiffs’ state law wage and hour
claims, there is no basis for federal jurisdiction the Court must remand the case back to the Circuit
Court of DuPage Court.
I.
Fair Labor Standards Act Section 203(o)
The Plaintiff claims that Spoerle v. Kraft Foods Global, Inc., where the Seventh Circuit
recently held that section 203(o) does not preempt Wisconsin wage and hour laws, applies directly
to this case. 614 F.3d 427 (7th Cir. 2010). While the general rule is that the FLSA requires
employers to pay workers for time spent donning and doffing protective equipment, FLSA section
203(o) allows for management and the union to enter into a collective bargaining agreement
(“CBA”) that excludes from “Hours Worked” any time spent “changing clothes.” See 29 U.S.C. §
203(o).
In a preemption analysis, Congress’ intent governs but there is the assumption that Congress
does not intend to interfere with a state’s police power to improve the welfare of its citizens. Wyeth
v. Levine, 129 S. Ct. 1187, 1994-95 (2009). This assumption is especially strong when Congress
passes legislation in an area such as labor law that has historically been occupied by the states. Altria
Group, Inc. v. Good, 129 S. Ct. 538, 543 (2008); see, e.g., Spoerle v. Kraft Foods Global, Inc., 626
F. Supp. 2d 913, 919 (W.D. Wisc. 2009). The general purpose of the FLSA is to correct “labor
conditions detrimental to the maintenance of the minimum standard of living necessary for health,
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efficiency, and general well-being of workers.” 29 U.S.C. § 202. Further, section 218(a) of the
FLSA shows Congress’ intent to leave more charitable state wage and hour laws unaffected by
federal statutes: “No provision of this chapter . . . shall excuse noncompliance with any Federal or
State law or municipal ordinance establishing a minimum wage higher than the minimum wage
established under this chapter or a maximum work week lower than the maximum workweek
established under this chaper.” 29 U.S.C. § 218(a). As such, if the state law establishes a higher
minimum wage or lower maximum work week than federal law, such a law would facilitate not
hinder Congress’ goals under the FLSA.
The constitutional basis for federal preemption is the Supremacy Clause, which states, “[T]he
Laws of the United States . . .shall be the supreme Law of the Land[.]” U.S. CONST . art. VI, cl. 2.
Federal preemption can exist in three forms. First, under express preemption, “Congress clearly
declares its intention to preempt state law.” Mason v. SmithKline Beecham Corp., 596 F.3d 387, 390
(7th Cir. 2010). Second, under implied preemption, the “‘structure and purpose’ of federal law
shows Congress’s intent to preempt state law.” Id. Third, under conflict preemption, there is “an
actual conflict between state and federal law such that it is impossible for a person to obey both.”
Id.
The Illinois laws at issue here, the IMWL and IWPCA, are wage and hour laws. The IMWL
establishes the minimum wage at $8.25 an hour but expressly states that it does not amend or rescind
any other state laws that provide more favorable minimum wage or maximum hour standards. See
820 ILCS 105/4, 105/13. Likewise, the IMWL does not “in any way diminish the right of employees
to bargain collectively with their employers through representatives of their own choosing in order
to establish wages or other conditions of work in excess of the applicable minimum standards of the
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provisions of this Act. 820 ILCS 105/14 (emphasis added). The IWPCA controls the pay periods
for wages, and also allows the parties to collectively bargain the date and arrangements for the
payment of wages. 820 ILCS 115/4. The federal counterpart to these state laws is FLSA section
203(o), which allows parties to a CBA to specifically exclude donning and doffing from the amount
of hours worked for the purpose of calculating the minimum wage and maximum workweek.
In Spoerle, the management and union agreed in a CBA that time spent donning and doffing
was not compensable. Id. Wisconsin wage and hour law, however, required exactly the opposite
– time spent donning and doffing must be compensated at minimum wage or higher. Id. The
Seventh Circuit held that the CBA created under FLSA section 203(o) did not preempt the
Wisconsin state laws. Id. at 430. The court reasoned that “[n]othing that labor and management can
put into a collective bargaining agreement exempts them from state laws of general application.”
Id. Further, “[m]anagement and labor acting jointly (through a CBA) have no more power to
override state substantive law than they have when acting individually.” Id. State laws that
disregard CBAs for failing to comply with state substantive law are valid. See id.
While Spoerle clearly governs where a conflict exists between the state law and FLSA
section 203(o), no such conflict is present between Illinois wage and hour laws and FLSA section
203(o). In Spoerle, the terms agreed to under the CBA directly conflicted with Wisconsin law: while
Wisconsin law required that donning and doffing count towards hours worked, under section 203(o)
the parties agreed in their CBA to exclude donning and doffing time. Illinois wage and hour law,
however, does not require the calculation of donning and doffing time like Wisconsin. Further, the
CBA between Plaintiffs and Defendant in this case does not explicitly indicate whether donning and
doffing time counts toward “hours worked.” Finally, section 203(o) and the IMWL and IWPCA
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provisions allow for CBAs to alter work hour and workweek calculations in excess of minimum state
or federal standards. Because Spoerle dealt with contrary state and federal provisions (and therefore
conflict preemption), and such a conflict does not exist here, the reasoning in Spoerle is instructive
but the Court cannot mechanically follow the decision as Plaintiffs suggest. For example, while the
CBA in Spoerle effectively exempted the parties from “state law[] of general application” that
required adding donning and doffing time to hours worked, the CBA in this case does not circumvent
Illinois wage and hour law.
Moreover, this is not a case of express preemption because section 203(o) contains no
express intention to replace state law. In fact, FLSA section 218(a), as noted in Spoerle, expressly
says the opposite: federal or state laws that establish higher minimum wages or a lower maximum
workweek than that set forth in the FLSA are valid. Implied preemption fails to apply for similar
reasons. In general, federal labor law “supplement[s] state law where compatible, and supplant[s]
it only when it prevents the accomplishment of the purpose of the federal Act.” 520 South Michigan
Ave. Associates, Ltd. v. Shannon, 549 F.3d 1119, 1127 (7th Cir. 2008) (quoting Metropolitan Life
Ins. Co. v. Mass., 471 U.S. 724, 756 (1985)). Labor law has historically been left to the states, not
the federal government. See, e.g., Anderson v. Sara Lee Corp., 508 F.3d 181, 193 (4th Cir. 2007).
There is no Congressional intent to occupy this entire area of law.
In sum, Spoerle is distinguishable from this case because Illinois law does not contain a
requirement like Wisconsin that requires calculation of donning and doffing time in hours worked.
See, e.g., In re Cargill Meat Solutions Wage and Hour Litigation, 632 F. Supp. 2d 368, 394 (M.D.
Penn. 2008) (more beneficial state law not preempted); Chavez v. IBP, Inc., CV-01-5093, 2005 WL
6304840, at *36 (E.D. Wash. May 16, 2005) (same). In fact, Illinois wage and hour laws are silent
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on the issue. Nevertheless, the end result is the same. Preemption is usually appropriate in cases
where, unlike this case, state laws eliminate employee rights that are set forth in CBAs. See, e.g.,
Spoerle v. Kraft Foods Global, Inc., 626 F. Supp. 2d 913, 921 (W.D. Wis. 2009), aff’d, 614 F.3d 427
(7th Cir. 2010); Livadas v. Bradshaw, 512 U.S. 107, 118 (1994) (grounds for preemption can exist
where state law penalizes use of collective bargaining process). Here, the IMWL/IWPCA and CBA
both say nothing about whether donning and doffing counts toward hours worked and under both
federal and state law management and unions can enter into CBAs exceeding minimum standards.
There is no apparent conflict between the IMWL/IWPCA and section 203(o) and therefore no federal
preemption based on FLSA section 203(o).
II.
LMRA Section 301
Defendant claims that the IMWL and IWPCA are preempted by LMRA section 301. Under
LMRA section 301, federal courts have jurisdiction over disputes that arise out of CBAs. 29 U.S.C.
§ 185(a). So that CBAs are uniformly applied, section 301 requires the application of federal law
to resolve any disagreements as to the CBA’s terms. Id.; Lingle v. Norge Div. of Magic Chef, Inc.,
486 U.S. 399, 403 (1988). Section 301 preemption is a case-by-case analysis and will be found
where a claim is “founded directly on rights created by collective bargaining agreements,” or
“substantially dependent on analysis of a CBA.” Atchley v. Heritage Cable Vision Associates, 101
F.3d 495, 498 (7th Cir. 1996); Int’l Bhd. of Elec. Workers v. Hechler, 481 U.S. 851, 859 n.3 (1987).
In other words, if the dispute centers around interpretation of the CBA’s terms, the state law claims
are “deemed federal in nature.” Atchley, 101 F.3d at 499.
Preemption, however, is not automatically granted in “every situation where a collective
bargaining agreement comes into play.” Atchley, 101 F.3d at 499; Loewen Group Intern., Inc. v.
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Haberichter, 65 F.3d 1417, 1421. For instance, where the CBA has a minimal effect on the dispute,
there is no preemption under section 301:
[C]ourts in this [Seventh]Circuit . . . have overwhelmingly concluded that, when the
resolution of a state wage claim requires more than a mere pro forma application of
collective bargaining provisions defining hours in a work week, determining
applicable rage rates, or delineating the method for calculating overtime pay,
preemption is applicable and the state claim is barred.
See, e.g., Carter v. Tyson Foods, Inc., 08-CV-209, 2009 WL 4790761, at *6 (N.D. Ind. Dec. 3,
2009). Similarly, section 301 preemption does not apply to “preempt nonnegotiable rights conferred
on individual employees as a matter of state law.” See, e.g., Gonzalez v. Farmington Foods, Inc.,
296 F. Supp. 2d 912, 300 (N.D. Ill. 2003) (Levin, M.J.); see Atchley, 101 F.3d at 499. The issue
driving section 301 preemption is whether Plaintiffs’ asserted claims require interpretation of the
CBAs.
Here, Plaintiffs claim that failing to compensate them for donning and doffing involves a
strict application of Illinois state law, without having to turn to the CBA. The Defendant, however,
argues that actions under state wage laws for unpaid wages are preempted by section 301 because
resolving the issue requires an in-depth examination of the CBA’s terms.
IMWL and IWPCA claims for unpaid time donning and doffing often require application of
the wage, overtime, and pay provisions in the CBA, and therefore section 301 preemption is
appropriate. See, e.g., Murray v. Tyson Foods, Inc., 08-4001, 2009 WL 322241, at 3 (LMRA section
301 preempted claims under IMWL and IWPCA for unpaid wages for donning and doffing because
interpreting CBA required determining what activities constituted “work time” and whether plaintiffs
were appropriatel paid); Carter, 2009 WL 4790761, at *6 (Section 301 preempted Indiana Wage
Statute claim for unpaid wages for donning and doffing because although CBAs did not specifically
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define “work,” “it is a matter of federal contract interpretation to determine whether the words of a
collective bargaining agreement created implied rights.”); Gonzalez, 296 F. Supp. 2d at 936
(Plaintiff’s state claims under IMWL and IWPCA for unpaid wages for donning and doffing were
created under CBA and therefore preempted by section 301); Carletto v. Quantum Foods, 05-3163,
2006 WL 2018250, at *5-6 (Ill. App. Ct. 2006) (Plaintiff’s claims under IMWL and IWPCA that
defendants failed to properly pay overtime wages for time spend donning and doffing were
preempted by section 301 because the court would have to determine whether donning and doffing
constitutes “work” under the CBAs). Moreover, another factor supporting preemption is if the CBA
provides overtime compensation exceeding that provided in the relevant state laws. See, e.g.,
Carletto, 2006 WL 2018250, at *6 (workers can earn overtime without working forty hours a week);
Anderson v. JCG Indus., Inc., 09 C 1733, 2009 WL 3713130, at *4 (N.D. Ill. Nov. 4, 2009) (Lefkow,
J.) (CBA allowed double overtime rate on Sundays, whereas state law requires at least time-and-ahalf).
Resolving the dispute in this case would require the Court to interpret, not merely reference,
the CBA. First, the Court must scrutinize the CBA to decide if “work” as defined in the CBA
includes donning and doffing. Both of the CBAs here refer to “work” performed and the rate at
which employees will be compensated for this work, but do not specifically indicate whether
donning and doffing constitutes “work.” (R. 35, Resp. to Mot. to Remand, Exs. A § 8.5, B § 7.6.)
Specifically, the meaning of “work” under the CBA implicates federal contract interpretation, and
therefore section 301. See, e.g., Carter, 2009 WL 4790761, at *7. Second, if the CBAs are
interpreted to include donning and doffing, the Court must decipher the compensation and overtime
provisions to arrive at the total amount Plaintiffs deserve. The CBAs offer different payment rates
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depending on seniority. (R. 35, Resp. to Mot. to Remand, Exs. A § 7.2, B § 28.8.) Premium rates
are also available for certain tasks. (R. 35, Resp. to Mot. to Remand, Exs. A § 7.3, B § 28.5.) If
donning and doffing is determined to fall under the CBAs, calculation of the unpaid wages would
require a factual, unique analysis for each plaintiff. See Atchley, 101 F.3d at 500 (timing of payment
of wage increases and whether employees were paid properly required interpretation of CBA); see,
e.g., Carletto, 2006 WL 2018250, at *6 (interpreting CBA to determine the amount of wages due).
Plaintiffs only allege violation of two state laws – the IMWL and IWPCA – in their
complaint, and therefore claim that “[t]o determine plaintiffs’ ‘hours worked’ for purposes of their
Illinois claim requires solely applying the facts of each plaintiffs’ situation to the definition set out
in Illinois law.” (R. 33, Pl. Renewed Mot. for Remand.) Preemption is not denied simply because
the complaint itself contained no explicit reference to the CBAs. See, e.g., Carter, 2009 WL
4790761, at 4-5 (CBA integral part of court’s motion to dismiss analysis even though it was not
referred to in the complaint). Even if a state statute creates a remedy for workers to obtain unpaid
wages, if that claim involves interpretation of the CBA, as it does here, “such a remedy would be
pre-empted by § 301.” Atchley, 101 F.3d 495. Further, the terms of the CBA provide more generous
compensation options than the IMWL and IWPCA. See Carletto, 2006 WL 2018250, at *6 (worker
can earn overtime without working forty hours a week); Anderson, 2009 WL 3713130, at *4 (“Just
as in Gonzalez, this right to overtime pay of more than time-and-one-half on Sundays is a specific
right created by the CBA and not granted by state or federal law. Interpretation of the CBA is
necessary to determine whether overtime pay was properly recorded and paid pursuant to the CBA’s
overtime provisions.”) Here, one of the CBAs provides for overtime pay double the regular rate on
Sundays, while Illinois law just sets a minimum standard of time-and-a-half for overtime. (R. 35,
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Resp. to Mot. to Remand, Ex. A § 8.4.) Likewise, while the IMWL mandates that employees
working more than 40 hours a week must receive overtime compensation, both CBAs entitle
employees to overtime compensation for “[a]ll work performed in excess of eight (8) hours at
straight time in one day.” (R. 35, Resp. to Mot. to Remand, Ex. A § 8.2, Ex. B § 7.2.) The CBAs
create Plaintiffs’ right to overtime compensation and the Court must interpret the CBAs to resolve
this case. As such, LMRA section 301 preempts Plaintiffs’ IMWL and IWPCA claims.
CONCLUSION AND ORDER
For these reasons, Plaintiffs’ Motion to Remand is denied.
________________________________________
Virginia M. Kendall
United States District Court Judge
Northern District of Illinois
Date: January 12, 2012
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