The anticipated decision by the U.S. Court of Appeals for the Ninth Circuit in Teamsters v. FMCSA dealing with federal preemption of California meal and rest breaks for motor carriers, highlighted in a previous Transportation Blog on Jan. 12, 2020,1 was more imminent than was suspected. In its decision issued on Jan. 15, 2021, the Ninth Circuit rejected the Teamsters challenge to the Federal Motor Carrier Safety Administration's (FMCSA) authority and upheld the FMCSA's order that California's meal and rest break rules (MRB rules) were preempted by the FMCSA Hours of Service Rules (HOS rules) as they applied to drivers of property-carrying commercial motor vehicles. See California's Meal and Rest Break Rules for Commercial Motor Vehicle Drivers, Petition for Determination of Preemption, FMCSA Docket No. 2018-0304, 83 FR 67470 (Dec. 28, 2018).
In its administrative ruling, the FMCSA had determined that the HOS rules addressed the area of safety specifically addressed by the California meal and rest break rules. Therefore, the FMCSA found that the MRB rules had "no safety benefit," were "incompatible" with the HOS rules and that "enforcement of 'the MRB rules' would cause an unreasonable burden on interstate commerce."
The Ninth Circuit determined that the FMCSA's decision "reflects a permissible interpretation of the Motor Carrier Safety Act of 1984, and is not arbitrary or capricious." (Slip. Op. at 9.) Citing the FMCSA's specific statutory authority to preempt state rules governing commercial vehicle safety, and the deference due to an agency decision in certain circumstances under the established doctrine of administrative agency review set forth in Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837 (1984), the Ninth Circuit found that the FMCSA acted squarely within its authority. Significantly, the Ninth Circuit's opinion dispensed with the Teamsters' argument that the FMCSA had no authority to act because the MRB rules were not specifically targeted to commercial motor vehicles, finding that California's MRB rules clearly applied to drivers of such vehicles and were designed, as the California Labor Commissioner had acknowledged, to "promote driver and public safety." The court also rejected the Teamsters' argument that the MRB rules should be upheld as they are part of California's "traditional 'police power'" given the express preemption authority given to the FMCSA by Congress.
The Ninth Circuit also agreed with the FMCSA that the MRB rules were "additional to or more stringent than" the federal regulations, because, as the FMCSA determined, "California requires more breaks, more often, and with less flexibility as to timing." The court rejected the Teamsters' argument that the MRB rules could be complied with by simply paying an extra hour of pay, as California's MRB rules require, as that would still be an added burden on transportation operations in interstate commerce, which are not imposed by the federal agency and its regulations.
Interestingly, the Ninth Circuit took into account the "patchwork of requirements" created by 20 states' meal and rest break statutes, and approved of the FMCSA considering the "cumulative 'effect on interstate commerce' " of the burdens created by the different states' requirements.
While it is not clear whether the Teamsters will seek review by the U.S. Supreme Court, this issue likely will be a focal point in the Biden Administration, given the appointments of Pete Buttigieg as Secretary of Transportation and Boston Mayor Marty Walsh as Secretary of Labor, both supporters of union labor. That said, as both are also reputedly pragmatists, there is an opportunity for them also to consider the persuasive decision of the Ninth Circuit finding that interstate commerce has been burdened by the different state requirements and that the federal HOS rules adequately protect driver and public safety.
1 See " Another Shift on Joint Employment and Independent Contractors," Holland & Knight Transportation Blog, Jan. 12, 2021. While the blog focused on independent contractor (IC) issues, Holland & Knight discussed the pending FMCSA decision in the Ninth Circuit given its impact on logistics operations in California. As substantial litigation over IC status in California has involved claims regarding meal and rest breaks, the fact that the federal hours of service (HOS) rules have been found to adequately protect driver and public safety removes these claims from such challenges.
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