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Court of Appeal, Second District, Division 1, California.


Civ. 62373.

Decided: February 05, 1982

Isman, Wolf & Feinberg and Herman J. Isman, Encino, for plaintiff and appellant. Proskauer, Rose, Goetz & Mendelsohn and Howard D. Fabrick, Steven G. Drapkin, and Carol A. Lombardini, Los Angeles, for defendant and respondent.


Plaintiff [Motion Picture Studio Grips, Local 80, International Alliance of Theatrical Stage Employees and Moving Picture Machine Operators of the United States and Canada] appeals from an order of dismissal entered after the trial court sustained without leave to amend defendant's [Association of Motion Picture and Television Producers, Inc.] demurrer to plaintiff's second amended complaint.


The second amended complaint discloses the following allegations:  Plaintiff union and defendant association executed a collective bargaining agreement dated February 1, 1976;  the agreement contains provisions relating to the receipt of holiday pay, vacation pay, and severance pay.   Holiday and vacation benefits become payable on March 15 of the year following the year in which services are performed, while severance benefits are payable within either 90 or 180 days after termination.   The collective bargaining agreement further provides, with respect to each type of benefit, that “[a]ny claim for the payment of holiday pay, not presented to the Producer within three hundred sixty-five (365) calendar days after the date upon which the employee is qualified ․ for such holiday [vacation or severance] pay shall be deemed to be waived.”

Members of plaintiff union are hired as employees by members of defendant association under the terms of the above collective bargaining agreement;  circumstances unique to the motion picture industry lead to an employment duration which varies from a day-to-day or “job” designation to more regular weekly or monthly designations;  at the end of each designated period of employment, union workers are terminated.   Hence, union workers may be employed by many members of defendant association within a brief period of time.

Upon each termination from employment, a union worker becomes eligible to receive holiday, vacation, and severance benefits which are payable in accordance with the terms of the collective bargaining agreement.   Accordingly, members of defendant association presently withhold the sums designated as holiday, vacation, or severance benefits until a claim therefor is made;  if no claim is made within 365 days of the employee's eligibility date, the funds are retained by members of defendant association as their own.   At present, members of defendant association are holding funds due to eligible employees who have not submitted claims;  in addition, members have deemed forfeited an estimated $200,000 in withheld funds over the last several years.


Plaintiff contends that the trial court erred in sustaining without leave to amend the demurrer to the second amended complaint in the following respects:


The application of state law to the claim and waiver provisions of the collective bargaining agreement is not preempted by federal labor law.


The claim and waiver provisions of the collective bargaining agreement are inconsistent with the public policy and law of this state;  specifically, the provisions contravene the requirements of sections 201, 201.5, 206 and 227.3 of the Labor Code.

For the reasons set forth below, we conclude that the demurrer was properly sustained without leave to amend.


 We note at the outset that a demurrer is appropriate where facts alleged are not sufficient to state a cause of action.  (Code Civ.Proc., § 430.10, subd. (e).)  A trial court's ruling sustaining a demurrer on that ground will be upheld if a plaintiff has failed to state a cause of action under any possible legal theory.  (See Barquis v. Merchants Collection Assn. (1972) 7 Cal.3d 94, 103, 101 Cal.Rptr. 745, 496 P.2d 817;  Porten v. University of San Francisco (1976) 64 Cal.App.3d 825, 833, 134 Cal.Rptr. 839.)   The second amended complaint purports to state causes of action on theories of breach of statutory obligation, conversion, declaratory relief, fraud, constructive trust, and quantum meruit;  however, plaintiff concedes that all causes of action are premised on the invalidity of the claim and waiver provisions of the collective bargaining agreement vis-a-vis the public policy and labor law of this state, and we limit our review accordingly.



Plaintiff misconceives the nature of the issue of preemption, framing it in jurisdictional terms;  yet, the instant issue is not one of jurisdiction in the sense of whether the power to entertain the proceeding rests with federal or state courts.  (Cf. Plumbing, Heating Etc. Council v. Howard (1975) 53 Cal.App.3d 828, 833–834, fn. 1, 126 Cal.Rptr. 406;  Jones v. General Tire & Rubber Co. (1976) 541 F.2d 660, 663.)   Rather, the issue is constitutional in dimension:  May the terms of the state's labor laws be applied to invalidate the subject provisions of the collective bargaining agreement?  (See Porter v. Quillin (1981) 123 Cal.App.3d 869, 875, 177 Cal.Rptr. 45.)

 Where a contractual provision deals with a subject matter properly included within the scope of mandatory collective bargaining under the National Labor Relations Act, state law may not be applied to invalidate the agreement of the contracting parties.  (Teamsters Union v. Oliver (1959) 358 U.S. 283, 294–296, 79 S.Ct. 297, 303–05, 3 L.Ed.2d 312.)  “The application [of inconsistent state law] would frustrate the parties' solution of a problem which Congress has required them to negotiate in good faith toward solving ․  [T]he paramount force of the federal law remains even though it is expressed in the details of a contract federal law empowers the parties to make, rather than in terms in an enactment of Congress.”  (Id., at pp. 296–297, 79 S.Ct. at 304–05;  see also Machinists v. Wisconsin Emp. Rel. Comm'n. (1976) 427 U.S. 132, 153, 96 S.Ct. 2548, 2559, 49 L.Ed.2d 396.)

Section 8(d) of the National Labor Relations Act (29 U.S.C. § 158, subd. (d)) requires employers and unions to “meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment ․”  Included within the scope of mandatory collective bargaining are such terms as vacation or holiday pay (Great Southern Trucking Co. v. National Labor R. Bd. (4th Cir. 1942) 127 F.2d 180, 186;  Singer Mfg. Co. v. National Labor Relations Board (7th Cir. 1941) 119 F.2d 131), pension benefits (Alessi v. Raybestos-Manhatten, Inc. (1981) 451 U.S. 504, 524, 101 S.Ct. 1895, 1907, 68 L.Ed.2d 402, 418), and limitations periods for the assertion of claims (Crockett v. Union Terminal Company (Tex.Civ.App.1960) 342 S.W.2d 129, 133).   Accordingly, the state is without power to influence such substantive terms of collective bargaining agreements.


Application of State Law

 It is clear that the Legislature and the courts of this state recognize the tension between the Labor Code and the substantive contracting authority of employers and unions under federal law.   Section 204 provides for the semimonthly payment of wages except “when such employees are covered by a collective bargaining agreement that provides different pay arrangements”;  section 204.1 requires the monthly payment of commission wages except “if there exists a collective bargaining agreement ․ which provides for the date on which wages shall be paid”;  and section 204.2 contains a similar exemption.

Moreover, the provisions on which plaintiff relies, Labor Code sections 227.3 and 201, manifest the same intent.  Section 227.3 expressly excludes collective bargaining agreements from its operation, providing:  “Unless otherwise provided by a collective-bargaining agreement, whenever a contract of employment or employer policy provides for paid vacations, and an employee is terminated without having taken off his vested vacation time, all vested vacation shall be paid to him ․ in accordance with such contract of employment or employer policy respecting eligibility or time served ․;  provided, however, that an employment contract or employer policy shall not provide for forfeiture of vested vacation time upon termination ․”  Labor Code section 201, provides that “the wages earned and unpaid at the time of [an employee's] discharge are due and payable immediately”; 2  but judicial construction holds that section 201 has no application where a collective bargaining agreement or contract of employment specifies that a particular form of compensation is payable on an established date and under defined terms and conditions.  (Sayre v. Western Bowl (1946) 76 Cal.App.2d 793, 799, 174 P.2d 466 [disapproved on another point in Reid v. Overland Machined Products (1961) 55 Cal.2d 203, 207–208, 10 Cal.Rptr. 819, 359 P.2d 251];  see also Hagin v. Pacific Gas & Elec. Co. (1957) 152 Cal.App.2d 93, 98, 312 P.2d 356.)   Thus, the Labor Code manifests an intent to leave the parties to a collective bargaining agreement free to negotiate the time and manner of payment of vacation benefits and other forms of wages, as well as the terms and conditions attendant thereon, both in the normal course of events and following an employee's termination.

The claim and waiver provisions at issue herein purport to do nothing more than condition the receipt of vacation, holiday and severance pay on the timely presentation of a claim after the arrival of the eligibility date.   So conditioning payment does not work a forfeiture upon termination, as claimed by plaintiff;  rather, recognizing the difficulties inherent in the administration of such payments, it allocates the burden of timely collection to the union member.   This is the very sort of negotiated problem-solving envisioned by the National Labor Relations Act (see Teamsters Union v. Oliver, supra, 358 U.S. 283, 296, 79 S.Ct. 297, 305, 3 L.Ed.2d 312) and exempted from the provisions of the Labor Code.   Accordingly, to construe the claim and waiver provisions as violative of the provisions of the Labor Code would contravene federal labor law as well as the declared policy of this state.

The order is affirmed.


1.   On demurrer, all material facts properly pleaded and all reasonable inferences which can be drawn therefrom are deemed admitted.   (See Glaire v. La Lanne-Paris Health Spa, Inc. (1974) 12 Cal.3d 915, 918, 117 Cal.Rptr. 541, 528 P.2d 357;  Daar v. Yellow Cab Co. (1967) 67 Cal.2d 695, 713, 63 Cal.Rptr. 724, 433 P.2d 732.)

2.   A companion provision, Labor Code section 201.5, recognizes the unique nature of the motion picture industry, providing:“An employer who lays off a group of employees engaged in the production of motion pictures whose unusual or uncertain terms of employment require special computation in order to ascertain the amount due, shall be deemed to have made immediate payment within the meaning of Section 201 if the wages of such employees are paid within such reasonable time as may be necessary for computation or payment thereof;  provided, however, that such reasonable time shall not exceed 24 hours after discharge excluding Saturdays, Sundays, and holidays;  and provided further, such payment may be mailed and the date of mailing is the date of payment.”

SPENCER, Presiding Justice.

LILLIE and DALSIMER, JJ., concur. Hearing denied;  BIRD, C. J., and MOSK, J., dissenting.