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Labor Union Employees Avoid Arbitration: Security Guards Sue Giants for Failure to Pay Wages Upon Te

“It is up to the state courts, not an arbitrator, to interpret state labor law standards applicable to all workers."

Union employees may be able to avoid forced arbitration, depending on the language in their collective bargaining agreement and the types of claims brought in the lawsuit.

On April 25, 2019, in Melendez v. S.F. Baseball Associates, LLC (SC S245607 4/25/19), the California Supreme Court held that a lawsuit for

unpaid wages upon discharge under Labor Code section 201 was not preempted by the Labor Management Relations Act of 194 ((29 U.S.C. § 185(a)), avoiding arbitration under Labor Code section 219. Security guards sued for unpaid wages. Under California’s labor laws, “[i]f an employer discharges an employee, the wages earned and unpaid at the time of discharge are due and payable immediately.” (Lab. Code, § 201, subd. (a).)

Applying a two-part test to decide whether the lawsuit was preempted under Labor Relations Act section 301 (a), the Court concluded that the claim in dispute under Labor Code section 201 required an interpretation of the state law, and not an interpretation of the collective bargaining agreement (“CBA”). Nor was the resolution of the Labor Code section 201 claim “substantially dependent upon analysis of the terms of” the collective bargaining agreement. So, the federal law requiring arbitration did not preempt the state law allowing employees to avoid arbitration under Labor Code section 219.

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