Ninth Circuit Court of Appeals Holds that US Airways’ Employees Who Trade Shifts Are Not Entitled to Overtime Pay in California

On January 24, 2020, the Ninth Circuit Court of Appeals held that US Airways’ employees that trade shifts are not entitled to overtime pay for added shifts in California.

In Joseph Angeles v. US Airways, Inc., the plaintiffs claimed that US Airways failed to pay its employees overtime for hours worked during shift trades in violation of California Labor Code Section 510, which requires employers to compensate work at a rate of at least one and one-half times regular pay for any hours worked that exceed eight hours per day or forty hours per week.  However, the Court of Appeals, in affirming the district court’s decision, held that the Railway Labor Act exemption in California Wage Order 9 (which regulates wages, hours, and working conditions in the transportation industry) exempted employees in the airline and railway industries who have entered into a collective bargaining agreement that meets the requirements of the Railway Labor Act.

While the plaintiffs tried to argue that the Railway Labor Act exemption did not create an exemption to the Labor Code’s overtime requirements, the Court of Appeals rejected this argument and held that the California Labor Code authorizes the Industrial Welfare Commission “to establish minimum wages, maximum hours and standard conditions of employment for all employees in the state.”  The Court further held that Industrial Welfare Commission issued a series of wage orders and exemptions in exercising this authority, including the Railway Labor Act exemption after determining that “it would be difficult to enforce standards for employees crossing state lines and that the exempted employees were better protected by their collective bargaining agreements pursuant to the Railway Labor Act.”

The Court of Appeals found that there was a proper collective bargaining agreement governing US Airways’ employees which states that shifts added through shift trades do not trigger overtime premium wage rates.  Therefore, it was held that US Airways’ employees could not recover overtime pay for traded shifts.

If you have questions about this recent decision, or about wage & hour rules in California, please contact Fadi K. Rasheed. Fadi is a Partner with Leech Tishman and a member of the firm’s Employment, Litigation and Corporate Practice Groups. Fadi is based in the Leech Tishman’s LAX – El Segundo, CA office. and can be reached at 424.738.4400 or frasheed@leechtishman.com. 

Leech Tishman’s Employment Practice Group can help clients ensure compliance with California’s complex and technical employment laws and can assist clients with defending against civil or administrative actions.

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