Ford v. St. Charles Health System, Inc.

Filing 30

ORDER: The Court declines to adopt Judge Beckerman's Findings and Recommendation, ECF 24 . Based on the Court's de novo review, plaintiff's claims are not preempted by § 301 of the LMRA, and defendant's Motion to Dismiss, ECF 4 , is DENIED. IT IS SO ORDERED. Signed on 3/26/2024 by Judge Adrienne Nelson. (gw)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON

ANNA FORD,

Case No.: 3:23-cv-00871-SB
Plaintiff,

v.
ORDER
ST. CHARLES HEALTH SYSTEM, INC.,
Defendant.

Adrienne Nelson, District Judge
United States Magistrate Judge Stacie F. Beckerman issued Findings and Recommendation
("F&R") in this case on November 06, 2023, in which she recommended that this Court grant defendant St.
Charles Health System, Inc.'s motion to dismiss. Plaintiff Anna Ford timely filed objections to the F&R,
to which defendant responded. See Objs. to F&R ("Objs."), ECF [26]; Resp. to Objs. to F&R, ECF [29].
The matter is now before this Court pursuant to 28 U.S.C. § 636(b)(1)(B) and Federal Rule of Civil
Procedure 72(b).
A district court judge may "accept, reject, or modify, in whole or in part, the findings or
recommendations made by the magistrate judge." 28 U.S.C. § 636(b)(l). If any party files objections to a
magistrate judge’s proposed findings and recommendations, "the court shall make a de novo determination
of those portions of the report." Id. If no objections are filed, then no standard of review applies. However,
further review by the district court sua sponte is not prohibited. Thomas v. Arn, 474 U.S. 140, 154 (1985).
The Advisory Committee notes to Federal Rule of Civil Procedure 72(b) recommend that, when no
objection is filed, the recommendations be reviewed for "clear error on the face of the record." Fed. R. Civ.
P. 72(b) advisory committee’s note to 1983 amendment.

DISCUSSION
Plaintiff brings this putative class action against defendant, her former employer, alleging

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state-law claims for violations of Oregon's wage and hour laws. See Notice of Removal, ECF [1], Ex. 1.
Plaintiff's wage claims are primarily based on Oregon Revised Statutes ("ORS") §§ 653.055 and 653.261
and Oregon Administrative Rule ("OAR") 839-020-0050. Id. ¶¶ 19-29. ORS § 653.055 "provid[es] for
liability of an employer 'who pays an employee less than the wages to which the employee is entitled[.]'"
Maza v. Waterford Operations, LLC, 300 Or. App. 471, 473, 455 P.3d 569, 570 (2019) (quoting ORS §
653.055(1)).
ORS § 653.261(1)(a) authorizes the Oregon Bureau of Labor and Industries ("BOLI") to
"adopt rules prescribing minimum conditions of employment, including minimum meal periods, 'as may be
necessary for the preservation of the health of employees.'" Id. at 473 (quoting ORS § 653.261(1)(a)).
Pursuant to that authority, BOLI promulgated OAR 839-020-0050(2), which requires an employer to
provide a minimum unpaid meal period of thirty continuous minutes, and if the employer fails to do so, the
employer must pay a penalty wage. Id. at 473-74.
Defendant moved to dismiss on the grounds that § 301 of the Labor Management Relations
Act ("LMRA"), 29 U.S.C. § 185, completely preempts plaintiff's state law claims, and plaintiff fails to state
a claim upon which relief can be granted. F&R, ECF [24], at 1. Judge Beckerman agreed.
Plaintiff makes two objections to the F&R: (1) it improperly finds complete preemption of
plaintiff's state law claims; and (2) even with a finding of preemption, it improperly dismissed plaintiff's
claims with prejudice. Objs. 2-6. As set forth below, the Court finds that the F&R improperly found that
plaintiff's state law claims were completely preempted. Thus, the Court only addresses plaintiff's first
objection.
A.

Preemption
In the Ninth Circuit, courts engage in a two-prong analysis when analyzing whether

employment class actions are preempted by the LMRA. Burnside v. Kiewit Pac. Corp., 491 F.3d 1053,
1059 (9th Cir. 2007). First, the court asks whether the asserted cause of action involves a "right [that] exists
solely as a result of the CBA." Id. (citation omitted). If not, the court proceeds to the second step and asks
"'whether a plaintiff's state law right is substantially dependent on analysis of [the CBA],' which turns on
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whether the claim cannot be resolved by simply 'look[ing] to' versus 'interpreting' the CBA." Curtis v. Irwin
Indus., Inc., 913 F.3d 1146, 1153 (9th Cir. 2019) (quoting Kobold v. Good Samaritan Reg'l Med. Ctr., 832
F.3d 1024, 1033 (9th Cir. 2016)).
1.

Prong One
The F&R found plaintiff's claims preempted on the basis that ORS § 653.261(3) sets forth

a carve-out that explicitly excludes certain nurses covered by collective bargaining agreements ("CBAs")
from BOLI regulation protections. ORS § 653.261(3), in relevant part, states: "Rules adopted by [BOLI]
pursuant to [ORS § 653.261(1)] regarding meal periods and rest periods do not apply to nurses who provide
acute care in hospital settings if provisions of [CBAs] entered into by the nurses prescribe rules concerning
meal periods and rest periods."
Judge Beckerman found this carve-out to be significant, reasoning, that "there does not
appear to be any dispute that [plaintiff] and the other class members are nurses who 'provide[d] acute care
in hospital settings,' and 'were subject to CBAs that 'prescribe[d] rules concerning meal periods and rest
periods.'" F&R 20 (citing ORS § 653.261(3)). Thus, because the carve out exempted plaintiff and the other
class members from the BOLI regulations, Judge Beckerman found that the CBA was the sole source of
plaintiff's and other class members' rights concerning meal and rest periods. Id.
Plaintiff, however, argues that the F&R should have looked to the plain language of the
CBA, which defers to state law for requirements related to interrupted or shorted meal periods. Objs. 2.
Plaintiff points to provisions in the CBA that state: "[Defendant] will comply with all legal requirements
with respect to meals and breaks if not otherwise provided in this Agreement" and "All other provisions
regarding meal and/or rest breaks contained in the labor contract, work instructions, or [BOLI] regulations
will apply." Notice of Removal, Ex. 2, at 13-14. Plaintiff maintains that those provisions are not mere
catchall provisions, but "bargained-for limitation[s] on the CBA's replacement of BOLI's rules on meal and
rest periods." Objs. 2.
The F&R relied on the Ninth Circuit's decision in Curtis v. Irwin Industries, Inc. In Curtis,
the Ninth Circuit found the plaintiff's claims preempted because a state statute contained a carve-out that
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expressly excluded employees covered by valid CBAs. 913 F.3d at 1153. However, unlike the present
case, the CBA in Curtis contained a bargained-for alternative standard to the minimum or default state
standard covered under the statute. Id. at 1154. The court found that "[b]y [the statute's] terms, . . . the
[default standards provided in the statute] do[ ] not apply to an employee who is subject to a qualifying
CBA." Id. at 1153-54. To find otherwise, "would render the collective bargaining exception in [the statute]
superfluous." Id. at 1154. Supporting that interpretation, the court noted that the statute's exception
demonstrated the legislature's intent to allow unionized employees to contract around the statute's
requirements. Id. at 1154-55. It follows that, when state statutes related to employee rights include carveout provisions excluding certain employees covered by CBAs, and the exclusion is triggered, any right an
employee may have to the associated statutory benefits arise exclusively under the CBA. Put simply, if a
statutory exclusion provision is triggered, an employee's claims under that statute will fail under the first
prong of the Burnside test. Id. at 1151.
Contrasting Curtis, plaintiff relies on Paige v. Henry J. Kaiser Company, 826 F.2d 857,
863 (9th Cir. 1987). Objs. 3-4. Paige, plaintiff argues, "rejected the notion that by stating that the parties
agree that state law will govern certain aspects of the relationship between an employer and its employees,
a CBA removes the state courts' jurisdiction over enforcement and interpretation of that state law." Id. at
4. Judge Beckerman was unpersuaded by plaintiff's reliance on Paige, stating "[It] did not address or appear
to involve a wage claim under a state statute that set forth a carve-out exception for certain CBA-covered
employees." F&R 20.
Paige involved employees who filed safety complaints and were subsequently discharged,
which they claimed was a violation of the California Occupational Safety and Health Act ("Cal/OSHA").
826 F.2d at 859-60. The Ninth Circuit centered its analysis on "whether the [state] tort action 'as applied
here confers nonnegotiable state-law rights on employers or employees independent of any right established
by contract, or, instead, whether evaluation of the tort claim is inextricably intertwined with consideration
of the terms of the labor contract.'" Id. at 863 (quoting Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 213
(1985)). The court maintained, "Congress did not intend for section 301 to preempt 'state rules that
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proscribe conduct, or establish rights and obligations, independent of a labor contract.'" Id. (quoting Lueck,
471 U.S. at 212). While the underlying CBA in Paige included a "catchall" provision stating that the
employer would comply with all state and federal law, including Cal/OSHA, the Ninth Circuit found that
the defendant had no authority to contract out of Cal/OSHA requirements. Id. at 865. Thus, a right cannot
solely arise from a CBA where the CBA cannot legally grant or deny that right.
While its true Paige did not involve a wage claim under a state statute with a carve-out
exception and Curtis does, Paige and Curtis do not conflict. Reading those principles together, where a
defendant has legal authority to contract for standards that differ from the statute, and with that authority
bargains for different standards, the operative CBA, not the statute, controls.
While not mentioned by the parties or the F&R, the principles set forth in Burnside and
McCray are instructive. The Ninth Circuit in Burnside and McCray addressed state statutes containing optout provisions for CBA-covered employees. Burnside, 491 F.3d at 1064; McCray v. Marriott Hotel Servs.,
Inc., 902 F.3d 1005, 1010-11 (9th Cir. 2018). In both cases, the court expressly "rejected the employer's
argument that the fact that a right could theoretically be waived meant that the right necessarily depended
on a CBA." McCray, 902 F.3d at 1010-11 (discussing Burnside, 491 F.3d at 1064-65). Indeed, the right
to be paid according to state law is "'one that came into existence entirely independently of the CBA, and
that remains in existence, independently of the CBA' unless and until the CBA waives it." Id. at 1011
(quoting Burnside, 491 F.3d at 1064). The Court emphasized that this principle stood irrespective of an
opt-out provision. Id. ("[T]he fact that the state law 'contain[ed] an opt-out provision [did] not change [the]
analysis.'") (quoting Burnside, 491 F.3d at 1070).
In the present case, while ORS § 653.261(3) authorized defendant to contract for standards
that differed from the BOLI regulations, the fact remains that it failed to do so. More significantly,
defendant's incorporation of existing state law forces plaintiff's claims to be independent of the CBA. The
Court need only to look at the plain language of ORS § 653.261(3), which provides that nurses who provide
acute care are exempted under the statute where their CBAs prescribe meal and rest period rules. Had the
CBA not incorporated existing BOLI regulations, defendant would have been able to utilize the exemption,
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as the CBA does in fact prescribe meal and rest period rules. However, the CBA's meal and rest period
rules are silent on the issue raised by plaintiff: the right to a continuous meal period. Thus, the only source
of this right in the CBA is by virtue of its deferral to BOLI regulations. In turn, the CBA's incorporation
of existing law sets plaintiff's claims outside of interpretation of the contract terms, and into interpretation
of state law. Thus, the Court finds that plaintiff's claims arise independently under state law and are not
subject to § 301 preemption on that basis.
2.

Prong Two
Because plaintiff's claims arise independently under state law, the Court turns to whether

her claims substantially depend on an analysis of the CBA. "To answer this, [the court] must decide if
[plaintiff's] case will require a court to merely 'look to' the CBA or instead 'interpret' its terms." McCray,
902 F.3d at 1011 (citations omitted). Merely needing to "look to" a CBA is insufficient to preempt a state
law claim, but needing to interpret a CBA will render the claim preempted. Livadas v. Bradshaw, 512 U.S.
107, 125 (1994). "Interpret" is narrowly defined—"it means something more than 'consider,' 'refer to,' or
'apply.'" Balcorta v. Twentieth Century Fox Film Corp., 208 F.3d 1102, 1108 (9th Cir. 2000). Indeed,
"reading and applying relevant, unambiguous provisions of the CBA" requires a court to only "look to,"
rather than "interpret," the agreement. McCray, 902 F.3d at 1012.
The only state regulation that plaintiff seeks to enforce is OAR 839-020-0050(2). F&R at
7. OAR 839-020-0050(2)(a) requires employers to provide, "for each work period [between six and eight
hours in length], a meal period of not less than [thirty] continuous minutes during which the employee is
relieved of all duties." If the employee is "not relieved of all duties for [thirty] continuous minutes during
the meal period," subsection (2)(b) requires the employer to "pay the employee for the entire [thirty]-minute
meal period." Plaintiff alleges that defendant "failed to ensure sufficient uninterrupted [thirty]-minute meal
periods, as required by law, were taken by [p]laintiff and other class members, resulting in regular net
underpayment of wages to them." Notice of Removal, Ex. 1, ¶ 6.
Defendant argues that the interpretive questions are "what it means to 'provide' a meal
period, what obligation [p]laintiff has to 'take' her meal period, and what constitutes 'interruption' to a meal
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period." Def.'s Reply in Supp. of Mot. to Dismiss ("Def.'s Reply"), ECF [12], at 8. Defendant points to
Section 7.7 of the CBA, which states, "[Defendant] is responsible for providing rest breaks and meal
periods; it is the nurse's responsibility to take them." Id., Ex. 2, at 20. Moreover, defendant points to
another provision that requires nurses to inform the charge nurse if they "anticipate[ ] that he or she will be
unable to take a meal period or rest break[.]" Id., Ex. 2, at 21. Thus, defendant maintains that "[w]hether
alleged interrupted meal periods constitute compensable time is a dispute regarding the meaning of the
CBA's terms and relative responsibilities of the parties and requires interpretation of the CBA." Def.'s
Reply 8-9.
Defendant misunderstands the principal inquiry. The Court's primary task in deciding this
case will be determining whether defendant provided uninterrupted meal periods of not less than thirty
minutes. Plaintiff's responsibility "to take" the meal period is triggered only if defendant provides a
continuous meal period. Because the CBA does not define "provide" or "continuous," the Court need not
interpret the CBA to determine whether a continuous meal break was provided. That is, if defendant
provides a meal period, but continues to interrupt that meal period, it seems unambiguous that defendant is
not actually providing a continuous meal period. Therefore, the Court finds that plaintiff's claims are not
substantially dependent on interpreting the CBA.

CONCLUSION
Accordingly, the Court declines to adopt Judge Beckerman's Findings and
Recommendation, ECF [24]. Based on the Court's de novo review, plaintiff claims are not preempted by §
301 of the LMRA, and defendant's Motion to Dismiss, ECF [4], is DENIED.

IT IS SO ORDERED.

DATED this 26th day of March, 2024.
______________________
Adrienne Nelson
United States District Judge
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