Goyette & Associates wage & hour attorney Gary Goyette has helped establish new case law affirming the application of California overtime pay requirements to tugboat employees working within California waters and servicing vessels which travel on the high seas involved in international trade. The California Supreme Court just denied the petition for review filed by the tugboat employer seeking to have the Court of Appeal decision affirming the overtime pay requirements, making the Court of Appeal decision final.

 As previously summarized, Gary Goyette has represented Bay Area tugboat Captain Jerrold Karmin since Mr. Karmin won his overtime pay complaint filed with the CA Labor Commissioner against his employer, Marine Express, and after this employer ‘appealed’ this award to the Alameda Count Superior Court. In the Superior Court, a one day bench trial was held and closing briefs were then filed by both sides. The attorneys for Marine Express argued that California overtime pay requirements (to pay time and a half wages for hours worked above eight hours in a day) did not apply to Mr. Karmin because he fell under the federal wage law ‘seaman’s exemption’ based on the fact that his work primarily involved transporting personnel and goods in the San Francisco Bay to ocean-going vessels anchored in the Bay, and therefore his work qualified as interstate and/or international trade falling under Maritime law. In turn, Marine Express attorneys argued that the federal ‘seaman’s exemption’, which did not require overtime pay for extra hours worked, controlled over or “preempted” the state wage law overtime pay requirements. The Superior Court agreed with the Marine Express arguments and ruled that CA overtime pay requirements were preempted by the federal wage law ‘seaman’s exemption’ for tugboat employees servicing ocean-going vessels.

Goyette & Associates appealed this ruling for Mr. Karmin to the California Court of Appeal, which reversed the Superior Court ruling and concluded that the federal wage law ‘seaman’s exemption’ does not preempt California’s overtime pay requirements for tugboat employees servicing ocean-going vessels. The Court of Appeal relied on the established case law cited by Gary Goyette to find that transportation of personnel and goods to vessels which would travel on the high seas, engaging in international trade and falling under various aspects of Maritime law, did not alter the application of state wage law regarding overtime pay – - at least not for tugboat employees working within California boundaries/waters. The Court of Appeal found the mere ‘connection’ to international trade did not affect California overtime pay requirements. Click here to view the document.

Also as previously summarized, Marine Express refused to accept the Court of Appeal decision as issued, and filed a petition for review to the California Supreme Court. On December 2nd, the Supreme Court denied this petition for review, making the Court of Appeal decision that state wage law is not preempted by the federal ‘seaman’s exemption’ for tugboat employees working within California waters final.

To see the courts decision click here: Court of Appeal DECISION 8 27 09

It’s becoming a long road for Bay Area tugboat Captain Jerrold Karmin.  After filing an overtime wage claim with the California Labor Commissioner based on his employer, Marine Express, refusing to provide overtime pay for work above eight hours per day, Mr. Karmin won at the hearing when the Labor Commissioner ruled that the belief held by Marine Express that the federal wage law ‘seaman’s exemption’ preempted state wage law was incorrect.  Marine Express then ‘appealed’ this decision to the Alameda County Superior Court and Mr. Karmin retained Goyette & Associates.  Following a one day trial, the Superior Court bought Marine Express’ argument that the state overtime pay requirement was preempted by the seaman’s exemption under the federal Fair Labor Standards Act (FLSA).  Gary Goyette then took that decision to the California Court of Appeal and won; the Court of Appeal ruled that even if a tugboat Captain satisfies the FLSA seaman’s exemption, such exemption from overtime pay under the FLSA does not preempt or overrule California’s overtime pay requirements when the employee in question performs his work within California boundaries, lives in California, and pays California taxes.

Marine Express won’t give up, as they have now filed a Petition to the California Supreme Court to hear this matter.  They still believe that since Mr. Karmin’s work involved servicing anchored, ocean going vessels in the San Francisco Bay, and since such vessels travel on the high seas after being serviced by Marine Express, the federal law must control over state wage law.  Of course for such argument to make sense, any work having a connection to the high seas, or to work in other countries, or even in multiple states should be governed only under federal wage law.  This of course was never the intention of California Legislators enacting state wage law and requiring time and a half pay for all work above eight hours per day.

Goyette & Associates will soon file a preliminary Answer to the Marine Express Petition, arguing that state wage law for California residents working entirely within the state is well established, and therefore the California Supreme Court should not even hear this matter. Whether the Supreme Court will accept the Marine Express Petition and will require full briefing from the parties will be determined over the next few months.

Karmin v. Marine Express:

In August 2009, the California Court of Appeal, ruled that the “Seaman’s Exemption” under the federal Fair Labor Standards Act (FLSA) did not automatically preempt California wage law requiring overtime pay for employee’s falling under this FLSA exemption – - at least not when such employee’s perform all their work within California boundaries, and are California residents & taxpayers.  State wage law as it applies to overtime pay to persons falling under this federal exemption still applies.  This CA Court of Appeal ruling was made in the case in which Goyette & Associates represents an individual employee, tugboat & launch boat captain Jerrold Karmin.

Jerrold Karmin, a resident of California and licensed tugboat and launch boat captain was denied overtime pay by his employer Marine Express.  Marine Express is a California corporation that, among other things, services ocean going vessels.  These vessels engage in interstate and international commerce and sail under both domestic and international flags with crews from all over the world.  All of Karmin’s work servicing these vessels, however, was performed within the territorial waters of California; more specifically, most of his work was performed within the San Francisco Bay. Despite this fact, Marine Express has always relied on the theory that once an employee falls under the FLSA ‘seaman’s exemption’, this exemption also ‘preempts’ and renders inapplicable California wage law regarding overtime pay.  The CA Court of Appeal did not see it that way.

Following the guidance of established case law and statutes, the CA Court of Appeal recognized that the FLSA does not preempt state regulation.  In fact the FLSA contains a “savings clause” which has been interpreted to expressly permit states to regulate overtime wages, particularly when other federal or maritime laws are not controlling and when the work performed is not done on the high seas or on bodies of water which cross between two or more states.  The Court determined that, regardless of whether the serviced ships were bound for interstate or international commerce, a California resident working exclusively within the state territorial waters of California is entitled to overtime compensation as required by state law. 

The CA Court of Appeal decision in favor of Mr. Karmin may be applicable to Marine Express and their present tugboat and launch boat captains and deckhands. For work performed entirely within California borders (and not on the high seas or between two or more states) the state law requirements for overtime pay for hours worked above eight (8) hours in a day remain controlling for tugboat and launch boat captains and deckhands.