November 2016 Archives

Is There Federal Preemption for California AB 1513 Claims Against California Trucking Companies for Rest and Recovery Breaks and Non-Productive Time?

By: Kyle D. Kring and Tyler Kring

AB 1513/Labor Code section 226.2 provides that companies who pay piece rate must pay for rest and recovery breaks and non-productive time separate and in addition to traditional piece rate wages. Trucking companies often opt to use piece rate pay because it incentivizes drivers to perform as efficiently as possible. In 1994, Congress aimed to prevent states from interfering with the trucking carriers' way of doing business and drafted a preemption provision in the Federal Aviation Administration Authorization Act of 1994 (FAAAA). The "safe harbor" affirmative defense which the recently passed AB 1513 create, has resulted in a number of trucking companies signing up with the Department of Industrial Relations (DIR) for the AB 1513 affirmative defense. The intersection between the FAAAA and AB 1513 has raised the question whether federal law, specifically the FAAAA, preempts California meal and rest break law including AB 1513/Labor Code section 226.2?

The answer to this question may be costly for California truck companies. The Ninth Circuit, in Dilts v. Penske Logisitcs, refused to adhere to Congress, holding that federal preemption did not apply to meal and rest breaks in California because the state laws were not sufficiently "related to" prices, routes, or services.

AB 1513 Due Diligence and Payment Procedures - Time to Comply is Running Out

By: Kyle D. Kring

Posted on November 8, 2016

As many of you know, the deadline to make the AB 1513 payments is currently December 15, 2016, unless the Fresno Superior Court issues a stay on payments made per AB 1513 within the next week or two, which appears unlikely at this time. What you may not know is that the December 15th deadline applies to both payments to employees you are able to identify and payments to the DIR/DLSE (two separate checks) for employees who you are not able to locate.

In order to accomplish your "due diligence" in locating ex-employees, you need to start the investigative process now to ensure compliance by December 15, 2016. We have recommended a two-step process of sending an initial letter to your ex-employees requesting they confirm their last known address. If the employee does not respond to this letter, we recommend that you conduct a public records search in a further attempt to locate the ex-employee and satisfy the "due diligence" requirement in AB 1513.

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