Ninth Circuit Upholds Victory for Trucking Industry: California Meal and Rest Break Rules Preempted by Federal Law as to Commercial Drivers
Ninth Circuit Upholds Victory for Trucking Industry: California Meal and Rest Break Rules Preempted by Federal Law as to Commercial Drivers

In a welcome surprise to the trucking industry, the Ninth Circuit Court of Appeals on January 15, 2021, upheld the Federal Motor Carrier Safety Administration’s (“FMCSA”) December 2018 determination that California’s meal and rest break rules (“MRB rules”) are preempted by federal law and do not apply to commercial truck drivers engaged in interstate commerce.  California’s strict meal and rest break laws require more breaks, more often, and with less flexibility as to timing than the federal hours-of-service regulations do for commercial drivers.  The decision is a welcome reprieve for the trucking industry which has faced a fair share of wage and hour battles in California over the last decade.

Background on FMCSA and Its 2018 Preemption Determination

The Motor Carrier Safety Act of 1984 grants the Secretary of Transportation the express power to preempt any state law or regulation “on commercial motor vehicle safety.”  This authority has been delegated to the FMCSA, an agency within the Department of Transportation.  The FMCSA is responsible for issuing federal regulations in commercial motor vehicle safety and has the authority to determine if state laws on commercial motor vehicle safety are preempted by federal regulations.  The FMCSA first evaluates the state law to see if it is “less stringent” or is “additional to or more stringent than” the federal regulation.  If it is, then the FMCSA compares the state law to the federal regulation to determine if the state law: has “no safety benefit;” “is incompatible with the federal regulation;” or if “enforcement of the state law would cause an unreasonable burden on interstate commerce.”  If the state law satisfies any of these conditions, then it is preempted by the federal regulation and not applicable.  (49 USC §§ 31141(c)(1)(C) and (c)(4)(A)-(C).)

For the last decade, the FMCSA has maintained that California’s MRB rules do not fall within the agency’s statutory authority under Section 31141 for preemption because they are not specifically directed at commercial motor vehicle safety but instead laws of general applicability.  However, in December 2018, under the Trump Administration, the FMCSA reversed course on its long standing position and determined that California’s MRB rules did not apply to commercial drivers as the MRB rules were preempted by federal regulations.  A petition for review followed.

Petition for Review to the Ninth Circuit

The California Labor Commissioner, the International Brotherhood of Teamsters, Local Union 2785, and several individual drivers (“Petitioners”) petitioned the Ninth Circuit for review of the FMCSA’s decision as arbitrary and capricious.  There is a presumption that courts defer to federal agency determinations on ambiguous law as long as the agency’s interpretation of the law is reasonable and the determination at issue is not arbitrary and capricious.  This deference is known as the Chevron deference doctrine based on the U.S. Supreme Court case Chevron USA Inc. v. Natural Resources Defense Council, Inc. (1984) 467 U.S. 837.

Petitioners challenged the FMCSA’s interpretation that California’s MRB rules were directed at commercial motor vehicle safety and emphasized the FMCSA’s decade-long position that they were rules of general applicability.  Petitioners also argued that the MRB rules were not more stringent than federal regulations and not a burden on interstate commerce.  The Ninth Circuit panel disagreed on all accounts and unanimously denied the petition. 

The FMCSA acknowledged that it changed its position from 2008 and reasoned to the Ninth Circuit that the change was based on different circumstances and new federal regulations that did not exist in 2008.  For example, it was not until 2011 that the FMCSA issued regulations on breaks for commercial drivers.  The FMCSA compared the federal regulations on breaks to the California MRB rules to show that the MRB rules were more stringent than the federal regulations.  The MRB rules require more breaks, with greater frequency, and with lesser ability to adjust the break time, resulting in more time off during the day when subject to the MRB rules.  The FMCSA was also successful in demonstrating to the court that the MRB rules cause an unreasonable burden on interstate commerce.  The FMCSA relied on public comments demonstrating how the MRB rules’ more demanding break requirements affected productivity and, in turn, the efficient operation of an interstate delivery system. 

The Ninth Circuit found that the FMCSA weighed the costs and benefits in concluding that the MRB rules posed an unreasonable burden on interstate commerce, and that the agency did not act arbitrarily or capriciously.  The Ninth Circuit opined that based on the principles that govern its ability to evaluate federal agency determinations, the petitions must be denied.

What This Means for Transportation Employers

While the Ninth Circuit’s decision is a victory for employers with drivers subject to federal rules and may provide a reprieve from rampant wage and hour lawsuits for meal and rest break violations under California law, employers should continue to proceed with caution in California.  The decision may be subject to an en banc rehearing before the Ninth Circuit — where the outcome could be different.  Even if the decision withstands an en banc hearing at the Ninth Circuit, the United States Supreme Court may be asked to review the decision and weigh in on various issues, including the Chevron deference doctrine.  Additionally, the Biden Administration is expected to be more favorable to employee and union interests than the prior administration, and thus, may seek to have the FMCSA retract its 2018 preemption determination.

Given the steep and costly ramifications for non-compliance with California meal and rest break laws, trucking companies should continue to closely monitor the developments in this area of law and consult with experienced counsel to determine appropriate policies and practices. 

Employers with questions regarding the implications of this case or who may be looking to evaluate their current meal and rest break policies for drivers subject to federal regulations should consult with their trusted employment counsel at AALRR or may contact the authors.

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