Bargaining Agreement Controls Scope of “Overtime” Hours for Premium Pay
February 20, 2014 by Adrian Barnes
In a recent opinion, a California appellate court considered whether California Labor Code’s definition of “overtime” applies to employees covered by a valid collective bargaining agreement (CBA). The case is Vranish et al. v. Exxon Mobil Corporation. In the private sector, case law related to employee job rights continues to define application of California Labor Code. Beeson, Tayer and Bodine (BT&T) a Sacramento and Oakland employment law firm has over 75 years of experience in employee and union rights and provides this and other summaries of relevant cases via our blog and newsletter. This important case upheld the rights of unions to negotiate CBA terms that define overtime thus giving unionized workforces flexibility not available to non-union workers.
California Labor Code section 510 defines overtime as “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.” Section 514 provides that section 510 does not apply “to any employee covered by a valid collective bargaining agreement if the agreement expressly provides for wages, hours of work, and working conditions of the employees, and if the agreement provides premium wage rates for all overtime hours worked and a regular hourly rate of pay for those employees of not less than 30 percent more than the state minimum wage.” (emphasis added).
Plaintiffs in Vranish v. Exxon Mobil were covered by a collective bargaining agreement which provided for overtime pay for hours worked over 40 hours in a workweek and over 12 hours in a workday, but not for hours in excess of 8 in a day. Plaintiffs were regularly scheduled to work 12 hour shifts, and were not paid overtime for hours worked between 8 and 12 in a workday. Plaintiffs contended that because they were not required to be paid for all overtime as defined by section 510, their CBA did not meet the requirements of section 514 – that is, the CBA did not provide premium pay for “all overtime” hours – and, thus, Plaintiffs were owed monies for overtime. The appellate court rejected the claim, ruling that the definition of overtime in section 510 does not apply to section 514. Rather, provided employers pay premium wage rates for overtime hours as defined in their collective bargaining agreements, section 514 applies and they are exempt from the requirements of section 510. This important labor law ruling ensures that unions retain the flexibility to adopt their own definitions of overtime in their collective bargaining agreements, and, thus, unionized workforces can continue to operate with greater flexibility than their non-union counterparts.
The court noted that, of course, the Federal Fair Labor Standards Act requires payment of time-and-a-half for hours worked that exceed forty in a week, and the employer – and the CBA — in Vranish complied with this federal requirement. Also significant was the fact that employees had been paid for all hours worked, and all overtime hours per the CBA. In cases where employees have not received the pay they are entitled, it is safe to say, they can enforce their job right to receive unpaid wages under the Labor Code. The decision also does not address when the employer must revert to paying overtime in accordance with state law upon the expiration of a CBA. BT&B encourages California union official and individuals to work with legal counsel to understand current employment law and seek assistance from an employment law firm when problems exist in the workplace.
The material on this website is provided by Beeson, Tayer & Bodine for informational purposes only and does not constitute legal advice. Readers should consult with their own legal counsel before acting on any of the information presented. Some of the articles are updated periodically, and are marked with the date of the last update. Again, readers should consult with their own legal counsel for the most current information and to obtain professional advice before acting on any of the information presented.
