41 F.4th 1147
9th Cir.2022Background:
- RUIA (45 U.S.C. §§351–369) provides exclusive federal unemployment and sickness benefits to railroad employees; Congress added sickness benefits in 1946 and included an express preemption clause forbidding state sickness benefits for railroad employment.
- California’s Healthy Workplaces, Healthy Families Act (Cal. Lab. Code §§245–249) (2014) requires paid sick leave (minimum 24 hours/3 days/year) usable for employee or family medical care, preventive care, and certain domestic-violence–related purposes (medical, counseling, safety planning, legal relief).
- Six railroad companies sued the California Labor Commissioner, arguing the California Act is preempted by RUIA (and raising ERISA and dormant Commerce Clause claims); unions intervened to defend the law.
- The district court granted summary judgment to the railroads; the Commissioner and unions appealed.
- The Ninth Circuit affirmed: RUIA’s express preemption bars application of California’s paid-sick-leave law to railroad employees because the Act is a “sickness law” providing “sickness benefits” within the meaning and scope of §363(b).
Issues:
| Issue | Plaintiff's Argument (Railroads) | Defendant's Argument (Commissioner / Unions) | Held |
|---|---|---|---|
| Whether RUIA preempts California’s paid-sick-leave law as applied to railroad employees | Yes — §363(b) makes RUIA the exclusive source of sickness benefits for railroad employees | No — California’s law is a separate state regime that should remain applicable | Held: Yes. RUIA preempts the California Act as applied to railroad employees |
| Whether “sickness benefits” in §363(b) includes state-provided paid sick leave (including family care and domestic-violence–related uses) | Yes — RUIA’s broad definition of “day of sickness” and the Act’s health-focused purposes bring paid sick leave within “sickness benefits” | No — paid sick leave (short absences, family care, social/legal services) is different in kind from RUIA benefits | Held: Yes. The Court reads “sickness” and “sickness benefits” broadly to include the Act’s paid sick days |
| Whether an express preemption clause should be read against preemption (presumption against preemption) | N/A (railroads relied on express clause) | Apply presumption against preemption to preserve state authority | Held: No presumption applies where statute contains an express preemption clause; §363(b) governs |
| Whether §363(b) should be limited to the kinds of state laws that existed in 1946 or to laws similar in form to RUIA | §363(b) intended to preempt state sickness laws broadly to prevent divergent schemes | Limit preemption to historical or RUIA-like state laws (short-term disability regimes) | Held: Rejects the historical/narrow-limitation argument; Congress intended broad exclusivity to avoid multiple conflicting state schemes |
Key Cases Cited
- R.R. Ret. Bd. v. Duquesne Warehouse Co., 326 U.S. 446 (1946) (historical context for federal railroad unemployment and sickness system)
- CSX Transp., Inc. v. Healey, 861 F.3d 276 (1st Cir. 2017) (First Circuit held RUIA preempted a Massachusetts paid-sick-leave law; rejected limiting preemption to RUIA-like schemes)
- CSX Transp., Inc. v. Healey, 327 F. Supp. 3d 260 (D. Mass. 2018) (district court ruling that RUIA preempted Massachusetts ‘earned sick time’ for railroad employees)
- Mut. Pharm. Co. v. Bartlett, 570 U.S. 472 (2013) (federal law preempts conflicting state law under the Supremacy Clause)
- Puerto Rico v. Franklin Cal. Tax-Free Tr., 579 U.S. 115 (2016) (no presumption against preemption when statute contains an express preemption clause)
- Altria Grp., Inc. v. Good, 555 U.S. 70 (2008) (scope of express preemption is determined by statutory text and structure)
- Egelhoff v. Egelhoff ex rel. Breiner, 532 U.S. 141 (2001) (Congress may design preemption broadly; form of state regulation is not dispositive)