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Self v. United Parcel Service11/23/1998
{1} We reverse the trial court's decision that state Minimum Wage Act claims brought by union workers covered by a collective-bargaining agreement are preempted by Section 301 of the Labor Management Relations Act, ch. 120, tit. III, § 301(a), 61 Stat. 156 (codified at 29 U.S.C. § 185(a) (1994)). We hold that these claims were not preempted because they are based on non-negotiable state law rights, and can be resolved independent of any collective-bargaining agreement. For the same reasons, we hold that these workers are not required to exhaust the remedies provided in the collective-bargaining agreement before proceeding in state court. We remand.
I. Factual and procedural background.
{2} Plaintiffs are package delivery drivers formerly employed by Defendant United Parcel Service (UPS, or the Company), whose terms and conditions of employment were governed by a collective-bargaining agreement between their union and the Company. Plaintiffs filed suit in state district court alleging that UPS violated the New Mexico Minimum Wage Act, NMSA 1978, §§ 50-4-19 to-30 (1993). Specifically, they complained that UPS automatically deducted a one-hour meal period from their hours worked despite the Company's actual and constructive knowledge that drivers regularly work through that period. They allege that UPS violated the Act by not crediting them for this and other "off- the-clock" work, and by not paying them time and a half for such work in excess of forty hours a week.
{3} The Company removed the action to federal district court, arguing that Plaintiffs' claims were preempted by Section 301 of the Labor Management Relations Act, 29 U.S.C. § 185 (1994). See 28 U.S.C. § 1441(a) (1994) (a defendant may remove a civil state court action to federal court when the federal court has original jurisdiction over the claims). The federal district court remanded the case to state court, holding that it lacked federal question jurisdiction "because plaintiffs' claims were not `founded directly on rights created by collective-bargaining agreements "substantially dependent on analysis of a collective-bargaining agreement,"' Caterpillar, Inc. v, Williams, 482 U.S. 386, 394 (1987) (citations omitted), and could be decided under New Mexico law."
{4} After remand to the state district court, UPS moved to dismiss, arguing that the Minimum Wage Act did not apply to Plaintiffs because they were parties to a collective-bargaining agreement from which they received more than minimum wage and for overtime pay, also arguing that Plaintiffs' claims were preempted by Section 301. Meanwhile, Plaintiffs moved to certify their case as a class action pursuant to the Minimum Wage Act, NMSA 1978, § 50-4-26(B)(2) and Rule 1-023 NMRA 1998. While that motion was pending, the trial court dismissed the case, apparently on the basis that Plaintiffs' claims were preempted under Section 301. Plaintiffs appealed to the Court of Appeals, which certified the matter to this court.
II. Analysis
{5} Introduction. The Company argues that because the terms and conditions of Plaintiffs' employment were controlled by the collective- bargaining agreement, Section 301 implicitly preempts Plaintiffs' claims. Alternatively, it claims the Plaintiffs failed to exhaust their remedies under the collective-bargaining agreement which is required by federal law. Thus, the success of both arguments depends on whether federal law controls Disposition of this case. See Livadas v. Bradshaw, 512 U.S. 107, 124 n.18 (1994); . We hold that it does not control. Therefore, we reject the Company's arguments, and reverse dismissal of the Plaintiffs' claims by the trial court.
{6} Standard of
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