California Courts of Appeal
A PAGA claim’s allegations that compensation was to be kept confidential, in violation of the Labor Code, was not preempted by the NLRADOE v. GOOGLE
PLAINTIFFS ALLEGED LABOR CODE VIOLATIONS BY GOOGLE AND ADECCO’S CONFIDENTIALITY POLICIES
Plaintiffs were employees with Google, placed there by Adecco. Both companies were considered joint employers for the purposes of the demurrers that they filed.
Plaintiffs alleged that Google and Adecco’s confidentiality policies prohibited them from discussing their wages, or from reporting illegal activities either internally or to government agencies. Plaintiffs alleged that these policies violated various provisions of the Labor Code, and sued under PAGA.
Meanwhile, one of the plaintiffs filed a complaint with the National Labor Relations Board, alleging violations of the National Labor Relations Act (“NLRA”) because of the policies, as well as his termination for violating those policies. The NLRB filed a complaint, which it ultimately settled in exchange for Google’s posting notice of employee’s rights. That settlement did not preclude the claims in the state courts.
THE TRIAL COURT SUSTAINED THE DEMURRER ON THE GROUNDS OF NLRA PREEMPTION
THE PAGA CLAIMS WERE NOT SUBJECT TO NLRA PREEMPTION
In examining the preemption issue, the appellate court looked to San Diego Bldg. Trades Council v. Garmon, 359 US 236 (1959) for the parameters of NLRA preemption. Although state laws addressing the same conduct prohibited by the NLRA are “presumptively preempted,” the court pointed out that there exist two analytically distinct types of exceptions to that rule under Garmon: (a) where the activity in question is merely a “peripheral concern” of the NLRA, and (b) where the conduct challenged is “deeply rooted in local feeling and responsibility . . . . “
Here, the plaintiffs sought to enforce Labor Code provisions that protect individual action, as opposed to the concerted action that is the stated purpose of the NLRA. The prohibition against discussing wages, for example, was made illegal by Labor Code §232 originally to help employees determine if they were being discriminated against on the basis of sex.
Moreover, the “local interest” exception to Garmon preemption applied because, as the US Supreme Court has said, labor standards are typically a matter left to the police power of the States. Furthermore, the NLRA was not enacted to enforce minimum labor standards, and thus the claims were of “peripheral concern” to the NLRA.
CONCLUSION
Labor Code claims, even when brought under PAGA on behalf of others, are not subject to NLRA preemption. Practitioners should be careful about filing concurrent claims with the NLRB, because the analysis – if not the outcome — might have been different had that body reached a decision on the merits or had Google admitted liability in the settlement agreement.
COA 1st Dist., Div. 4; Filed 9/21/20. Opinion by Justice Tucher.
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