Matson v. United Parcel Service, Inc., No. 13-36174 (9th Cir. 2016)
Annotate this CasePlaintiff filed suit against her employer, UPS, alleging a state law gender-based hostile work environment claim. A jury returned a verdict for plaintiff on that claim, but the district court granted UPS's motion for a new trial on the ground that the claim was preempted under section 301 of the Labor Management Relations Act (LMRA), 29 U.S.C. 185(a). The jury in the second trial found for UPS. The court concluded that the district court erred in holding plaintiff's claim preempted. The court fashioned a two-part test to determine whether a state law claim is preempted under section 301. At the first step, the court asks “whether a particular right inheres in state law or, instead, is grounded in a CBA.” Only if the claim is “founded directly on rights created by collective-bargaining agreements” is preemption warranted at this step. At step two, “to determine whether a state law right is ‘substantially dependent’ on the terms of a CBA,” the court asks “whether the claim can be resolved by ‘look[ing] to’ versus interpreting the CBA.” In this case, the jury did not have to decide what any provision of the CBA requires. Therefore, the court reversed the district court's conclusion that plaintiff's claims were preempted to the extent they relied on her allegations regarding UPS’s extra work assignments, and reinstated the jury verdict from the first trial. The court also reversed the district court’s conclusion that the jury’s damages award was “grossly excessive” and remanded for reconsideration.
Court Description: Labor Law / Preemption. The panel reversed the district court’s preemption ruling; held that the district court erred in holding that an employee’s state law gender-based hostile work environmental claim was preempted under § 301 of the Labor Management Relations Act (LMRA); reinstated the jury verdict from the first trial in favor of the employee; and remanded. The panel noted the two-part test used to determine whether a state law claim is preempted under § 301 of the LMRA. At the first step, the court asks “whether a particular right inheres in state law or, instead, is grounded in a [collective bargaining agreement (CBA)],” Burnside v. Kiewit Pac. Corp., 491 F.3d 1053, 1060 (9th Cir. 2007); and preemption is warranted at this step only if the claim is directly founded on rights created by the CBA. At step two, the court asks whether the state law claim can be resolved by “looking to” the CBA, in which case the claim is not preempted; or whether the claim “interprets” the CBA, in which case the claim is preempted. The panel held that adjudication of the employee’s hostile work environment claim did not require interpretation of a provision of the CBA, and preemption under § 301 of the LMRA was not warranted. Specifically, the panel rejected the employer’s suggestion that the employee’s claim was nothing more than a repackaged “contractual dispute” over MATSON V. UPS 3 the assignment of extra work. The panel concluded that the claim was not preempted under the first Burnside factor because it was not grounded in any right created by the CBA. The panel further held that nothing in the nature of the employee’s hostile work environment claim required interpretation of the CBA. The panel also rejected the employer’s argument that Perugini v. Safeway Stores, Inc., 935 F.2d 1083 (9th Cir. 1991), controlled this case. The panel held that because the district court’s conclusion that the jury’s damages award was “grossly excessive” rested in part on its erroneous preemption ruling, that determination was also reversed, and the panel remanded for reconsideration of the damages question.
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