CSX Transportation, Inc. v. Healey ( 2017 )

United States Court of Appeals
For the First Circuit
No. 16-2171
CSX TRANSPORTATION, INC.; CSX INTERMODAL TERMINALS, INC.;
NATIONAL RAILROAD PASSENGER CORPORATION, d/b/a Amtrak;
SPRINGFIELD TERMINAL RAILWAY COMPANY,
Plaintiffs, Appellees,
v.
MAURA HEALEY, in her official capacity as Attorney General of
the Commonwealth of Massachusetts,
Defendant, Appellant,
TRANSPORTATION DIVISION OF THE INTERNATIONAL ASSOCIATION OF
SHEET METAL, AIR, RAIL AND TRANSPORTATION WORKERS; MECHANICAL
DIVISION OF THE INTERNATIONAL ASSOCIATION OF SHEET METAL, AIR,
RAIL AND TRANSPORTATION WORKERS; BROTHERHOOD OF LOCOMOTIVE
ENGINEERS AND TRAINMEN; BROTHERHOOD OF MAINTENANCE OF WAY
EMPLOYES DIVISION/IBT; BROTHERHOOD OF RAILROAD SIGNALMEN;
INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS; NATIONAL
CONFERENCE OF FIREMEN & OILERS DISTRICT OF LOCAL 32BJ, SEIU,
Defendants.
No. 16-2172
CSX TRANSPORTATION, INC.; CSX INTERMODAL TERMINALS, INC.;
NATIONAL RAILROAD PASSENGER CORPORATION, d/b/a Amtrak;
SPRINGFIELD TERMINAL RAILWAY COMPANY,
Plaintiffs, Appellees,
v.
TRANSPORTATION DIVISION OF THE INTERNATIONAL ASSOCIATION OF
SHEET METAL, AIR, RAIL AND TRANSPORTATION WORKERS; MECHANICAL
DIVISION OF THE INTERNATIONAL ASSOCIATION OF SHEET METAL, AIR,
RAIL AND TRANSPORTATION WORKERS; BROTHERHOOD OF LOCOMOTIVE
ENGINEERS AND TRAINMEN; BROTHERHOOD OF MAINTENANCE OF WAY
EMPLOYES DIVISION/IBT; BROTHERHOOD OF RAILROAD SIGNALMEN;
INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS; NATIONAL
CONFERENCE OF FIREMEN & OILERS DISTRICT OF LOCAL 32BJ, SEIU,
Defendants, Appellants,
MAURA HEALEY, in her official capacity as Attorney General of
the Commonwealth of Massachusetts,
Defendant.
APPEALS FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Nathaniel M. Gorton, U.S. District Judge]
Before
Lynch, Lipez, and Kayatta,
Circuit Judges.
Douglas S. Martland, Assistant Attorney General, with whom
Maura Healey, Attorney General of Massachusetts, and Pierce O.
Cray, Assistant Attorney General, were on brief, for the
Commonwealth appellant.
Michael S. Wolly, with whom Zwerdling, Paul, Kahn & Wolly,
P.C., Richard S. Edelman, Mooney, Green, Saindon, Murphy and Welch
PC, Erika A. Diehl-Gibbons, Kevin C. Brodar, and SMART-TD were on
brief, for the union appellants.
Donald J. Munro, with whom Anthony J. Dick and Jones Day were
on brief, for the appellees.
M. Patricia Smith, Solicitor of Labor, United States
Department of Labor, G. William Scott, Associate Solicitor,
Elizabeth Hopkins, Counsel for Appellate and Special Litigation,
Melissa Moore, Attorney, Plan Benefits Security Division, Benjamin
C. Mizer, Principal Deputy Assistant Attorney General, United
States Department of Justice, Civil Division, Alisa B. Klein,
Attorney, Appellate Staff, Civil Division, Lindsey Powell,
Attorney, Appellate Staff, Civil Division, and Carmen M. Ortiz,
United States Attorney, on brief for the United States as amicus
curiae in support of the appellants.
June 23, 2017
KAYATTA, Circuit Judge. In 2014, Massachusetts voters
enacted by plebiscite the Massachusetts Earned Sick Time Law
("MESTL"). 2014 Mass. Legis. Serv. ch. 505 (West). The law
requires most employers with eleven or more employees to provide
"[e]arned paid sick time" for a variety of reasons, including
absence from work due to illness. Mass. Gen. Laws ch. 149,
§ 148C(a)-(c). The question posed by these appeals is whether
application of the MESTL to interstate rail carriers that employ
workers in Massachusetts is preempted by the Railroad Unemployment
Insurance Act ("RUIA"), 45 U.S.C. §§ 351-369. That federal law
requires interstate rail carriers to bear the cost of an insurance
program for employees who miss work on account of sickness and are
not otherwise compensated during their absence. See id.
§ 352(a)(1)(B). The RUIA states that its provision for the payment
of sickness benefits is "exclusive," and that no person employed
by an interstate rail carrier "shall have or assert any right . . .
to sickness benefits under a sickness law of any State." Id.
§ 363(b).
For the following reasons, we agree with the district
court that the RUIA certainly preempts some parts of the MESTL as
applied to employees of interstate rail carriers. We nevertheless
remand for further consideration of whether other parts of the
Massachusetts law that are not within the preemptive reach of the
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RUIA, and are not otherwise preempted by another federal law, might
still be applied to interstate rail carriers.
I.
A.
As originally enacted in 1938, the RUIA mandated that
interstate rail carriers fund an insurance system that provides
partial wage replacement, known as "unemployment benefits," to
covered employees who are not working but who are able and
available to work. See Act of June 25, 1938, ch. 680, §§ 1(k),
2(a), 52 Stat. 1094, 1096 (codified as amended at 45 U.S.C.
§§ 351(k)(1), 352(a)(1)(A)). In 1946, Congress added to the RUIA
a mandate that interstate rail carriers also fund "sickness
benefits" to provide a minimum level of wage replacement for
employees unable to work due to sickness. See Act of July 31,
1946, ch. 709, §§ 301–07, 60 Stat. 722, 735-37 (codified at 45
U.S.C. §§ 351(h)–(i), (k)(2), (l), 352(a), (c), (f)).
Adding sickness benefits to the statute required
Congress to address a series of questions. Who was covered? Which
conditions qualified as a sickness? When did the employee become
eligible for sickness benefits? What was the amount and duration
of the benefits? How and to what extent must the employer fund
the benefits? The text of the RUIA answers each of these
questions. As generally applicable to most employees, it requires
the payment of "sickness benefits" for "each day of sickness after
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the 4th consecutive day of sickness in a period of continuing
sickness."1 45 U.S.C. § 352(a)(1)(B)(i). A "day of sickness"
means "a calendar day on which because of any physical, mental,
psychological, or nervous injury, illness, sickness, or disease
[the employee] is not able to work." Id. § 351(k)(2). It also
encompasses, "with respect to a female employee, a calendar day on
which, because of pregnancy, miscarriage, or the birth of a child,
(i) she is unable to work or (ii) working would be injurious to
her health." Id. The only added criteria defining "day of
sickness" are that a "day of sickness" does not include: (1) a
day on which "remuneration is payable or accrues to [the
employee]," or (2) a day of unpaid absence not documented in
accordance "with such regulations as the [Railroad Retirement]
Board may prescribe." Id. In other words, the employee gets no
wage replacement if the employee is collecting payment for services
anyhow, or if the employee does not document the claim for sickness
benefits in accordance with regulations established by the Board
that administers these benefits.
These decisions by Congress established only the minimum
level of benefits that must be paid. Employers remained free to
provide benefits to sick workers sooner, to continue benefits
1In certain circumstances, the statute imposes a one-week
waiting period such that no benefits are payable for the employee's
first seven days of sickness. 45 U.S.C. § 352(a)(1)(B)(ii).
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longer, or to pay benefits at higher rates. The employees, in
turn, remained free to bargain for better benefits.
B.
Having mandated a nationwide, minimum level of sickness
benefits for this quintessentially interstate business, Congress
also exercised its power under the Supremacy Clause to preempt
certain state laws. The text of the preemption provision states
as follows:
By enactment of this chapter the Congress
makes exclusive provision for the payment of
unemployment benefits for unemployment
occurring after June 30, 1939 and for the
payment of sickness benefits for sickness
periods after June 30, 1947, based upon
employment (as defined in this chapter). No
employee shall have or assert any right to
unemployment benefits under an unemployment
compensation law of any State with respect to
unemployment occurring after June 30, 1939, or
to sickness benefits under a sickness law of
any State with respect to sickness periods
occurring after June 30, 1947, based upon
employment (as defined in this chapter). The
Congress finds and declares that by virtue of
the enactment of this chapter, the application
of State unemployment compensation laws after
June 30, 1939, or of State sickness laws after
June 30, 1947, to such employment, except
pursuant to section 362(g) of this title,
would constitute an undue burden upon, and an
undue interference with the effective
regulation of, interstate commerce.
Id. § 363(b).
The parties agree that the foregoing language, as
applied today to interstate rail carriers, plainly preempts any
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mandate to provide "sickness benefits under a sickness law of any
State . . . based upon employment." Id. Their disagreement
centers on whether the employee benefits mandated by the MESTL
qualify as such. Before the MESTL took effect, several interstate
rail carriers sought assurance from the Massachusetts Attorney
General that the law would not apply to their railroad employees
working in Massachusetts. The Attorney General "declined to offer
any assurances" about the relationship between the state and
federal laws.
Facing "a substantial threat of imminent prosecution,"
the carriers filed the present action against the Attorney General
seeking a declaratory judgment that the MESTL is preempted by the
RUIA as well as by the Railway Labor Act ("RLA"), 45 U.S.C. §§ 151-
165, and the Employee Retirement Income Security Act ("ERISA"), 29
U.S.C. §§ 1001-1461. The district court permitted several unions
representing Massachusetts railroad workers to intervene as
defendants. It also accepted a "statement of interest" filed by
the United States in support of the defendants. In due course,
the district court granted summary judgment in favor of the
plaintiff carriers, holding that the RUIA preempted the MESTL in
its entirety as applied to the plaintiff carriers. In so disposing
of the action, the district court did not reach the plaintiffs'
alternative claims that either the RLA or ERISA preempted the
MESTL, which the parties had agreed to litigate, if necessary, in
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a second phase of the action. Nor did it expressly consider
whether any portions of the MESTL might be saved by severance.
Following entry of final judgment in favor of the plaintiff
carriers, the Attorney General and the union intervenors
(collectively, "appellants") timely appealed.
II.
We start with the text of the MESTL and ask whether it
provides "sickness benefits under a sickness law of any State" as
that phrase is used in 45 U.S.C. § 363(b). In its most relevant
part, the MESTL states:
(c) Earned sick time shall be provided by an
employer for an employee to:
(1) care for the employee's child,
spouse, parent, or parent of a spouse,
who is suffering from a physical or
mental illness, injury, or medical
condition that requires home care,
professional medical diagnosis or care,
or preventative medical care; or
(2) care for the employee's own physical
or mental illness, injury, or medical
condition that requires home care,
professional medical diagnosis or care,
or preventative medical care; or
(3) attend the employee's routine medical
appointment or a routine medical
appointment for the employee's child,
spouse, parent, or parent of spouse; or
(4) address the psychological, physical
or legal effects of domestic
violence . . . .
Mass. Gen. Laws ch. 149, § 148C(c)(1)-(4). Qualified employees
may earn and use up to forty hours of sick time per year, id.
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§ 148C(d)(4), (6), and those at firms of eleven or more employees
are entitled to payment for the sick time they use at their normal
hourly rate through their usual payroll system, id.
§ 148C(a),(d)(4),(d)(7).
We observe at the outset that the four quoted subsections
of § 148C(c) of the MESTL recognize several different reasons for
which paid sick time must be provided. One of those reasons, as
specified in subsection (c)(2), is the need to "be absent from
work . . . to . . . care for the employee's own physical or mental
illness, injury, or medical condition." Id. § 148C(b)-(c)(2).
Plainly a benefit paid for such a reason is a benefit that helps
protect an employee from economic loss resulting from a sickness.
Other uses (such as, for example, addressing the legal effects of
domestic violence) seemingly have nothing to do with employee
sickness. We will therefore begin our analysis by focusing on
MESTL subsection (c)(2).
A.
Crafting subsection (c)(2) of the MESTL required
answering the questions addressed by Congress in creating the
RUIA's sickness benefits. Who was covered? Which conditions
qualified as a sickness? When did the employee become eligible
for sickness benefits? What was the amount and duration of the
benefits? And so on. On many such questions, the MESTL reflects
different answers than does the RUIA. Rather than requiring
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employers to fund an insurance program that in turn pays workers,
the MESTL requires the employer to pay the worker directly. The
MESTL also mandates payment starting on the very first hour of
absence due to sickness at one hundred percent of regular pay.
See id. § 148C(a),(d)(1). But earned paid sick time under the
MESTL is limited to forty hours per calendar year. Id.
§ 148C(d)(4),(7). The upshot: as compared to the RUIA sickness
benefits, the MESTL sick time is a larger benefit in the short run
but does not cover the longer run.
At first blush, and even more so after a careful read,
it seems quite plain that subsection (c)(2) of the MESTL provides
"sickness benefits under a sickness law of [a] State," and is
therefore expressly preempted. Certainly a "physical or mental
illness, injury, or medical condition" is a sickness, and certainly
"paid sick time" is a benefit. Nevertheless, the appellants and
the United States as amicus curiae advance several arguments in
support of their reading of the preemption clause as a narrow
provision with a meaning that does not encompass the type of
benefits mandated by subsection (c)(2). We consider those
arguments, moving from simple to complex.
B.
1.
The appellants first try an ordinary meaning argument.
See In re Hill, 562 F.3d 29, 32 (1st Cir. 2009) ("We assume that
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the words Congress chose, if not specially defined, carry their
plain and ordinary meaning."). Citing to Roberts' Dictionary of
Industrial Relations, they contend that the term "sick benefit" is
customarily understood to mean only "short-term disability
insurance," and not "sick pay" or "sick leave." Harold S. Roberts,
Roberts' Dictionary of Industrial Relations (4th ed. 1994). But
the pertinent term in the RUIA is "sickness benefits," not "sick
benefit." And the pertinent legislation predates the cited
dictionary by half a century. The 1998 and 2011 glossaries cited
by the union intervenors defining "short-term disability plan" and
"sick leave" suffer from the same anachronistic defect. So this
argument falls short.
2.
The Attorney General next undertakes an elaborate
attempt to find in the text of the RUIA a narrow technical reading
of "sickness benefits" that excludes the type of benefit that the
MESTL mandates in subsection (c)(2). The resulting, principal
textual argument has eight steps: The word "benefits" as used in
the RUIA is a defined term that "means the money payments payable
to an employee as provided in this chapter, with respect to his
unemployment or sickness," 45 U.S.C. § 351(l)(1) (emphasis
supplied); the chapter provides for payments in the form of partial
wage replacement when an employee is unable to work, and receiving
no earned income, due to sickness, id. § 352(a)(1)(B)(i), (a)(2);
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this interpretation of "money payments . . . as provided in this
chapter" is confirmed by the definition of "day of sickness," which
excludes any day on which the employee receives remuneration from
the employer, id. § 351(k)(2); the benefit mandated by the MESTL
is not a partial wage replacement for when an employee is unable
to work, and receiving no earned income, due to sickness; this
interpretation is confirmed by federal law's designation of the
MESTL benefit as "remuneration," 20 C.F.R. § 322.2(c); any day the
MESTL benefit is paid is thus not a "day of sickness"; that benefit
is therefore not a "money payment . . . as provided in th[e]
chapter"; and so it is not a "sickness benefit."
We react to this reasoning with considerable skepticism
concerning the first step: that "benefits" as used in the
preemption clause means only "benefits" as artificially defined in
45 U.S.C. § 351. See Yates v. United States, 135 S. Ct. 1074,
1082 (2015) ("We have several times affirmed that identical
language may convey varying content when used in different
statutes, sometimes even in different provisions of the same
statute."). The definition provision itself warns that the
supplied definition of "benefits" does not apply "in phrases
clearly designating other payments." 45 U.S.C. § 351(l)(1). The
preemption clause uses just such a phrase, designating as the
target of its preemptive force "sickness benefits under a sickness
law of any State." Id. § 363(b) (emphasis supplied). Furthermore,
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the preemption clause seems to be express in specifying when it
intends a word of common usage to be understood only as defined in
the RUIA, four times using the phrase "as defined in this chapter"
to modify terms that are given specific meanings in § 351. Id.
The full text of the preemption clause reinforces our
skepticism. In explaining its exercise of preemptive force, the
clause states that "application . . . of State sickness laws . . .
to such employment . . . would constitute an undue burden upon,
and an undue interference with the effective regulation of,
interstate commerce." Id. In so stating, Congress found it
natural to avoid altogether any use of the word "benefits" upon
which the Attorney General's textual argument against preemption
depends. The Attorney General makes no claim that the
Massachusetts law is not, in relevant part, "a sickness law of a[]
State." It would therefore be quite remarkable for Congress,
having declared that such a law impedes effective regulation of
interstate commerce, to have nevertheless excluded it from the
scope of preemption by use of the roundabout textual path that the
Attorney General has sought to discern.
Tellingly, if the Attorney General were correct that the
RUIA preempts only state sickness laws that mandate "benefits"
precisely as that term is defined in § 351, then it would follow
that no reasonably plausible state law would be preempted. As
summarized above, the defined term "benefits" is limited to money
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payments for "days of sickness." And while the Attorney General
is correct that the RUIA's definition of "day of sickness" excludes
any day on which remuneration is paid, it also excludes any day
for which timely documentation as required by Railroad Retirement
Board regulations is not filed. Id. § 351(k)(2). So if the
Attorney General's textual reading were correct, no state law would
be preempted unless, implausibly, it mandated the filing of
Railroad Retirement Board documentation. And the Attorney General
ultimately concedes that her interpretation would limit the scope
of the preemption clause "to those state laws . . . that create
short-term disability insurance programs that would replicate the
RUIA's and hence result in duplicate liability for the Railroads."
This interpretation does not comport with the statute's
stated purpose of protecting interstate rail regulation from the
burdens of state sickness law. As the United States explains in
its brief, the legislative history of § 363(b) and the thrust of
the Act's pertinent sections are clear on at least one point: the
RUIA was enacted to ensure "a uniform federal scheme." See H.R.
Rep. No. 75-2668 at 1 (1938) ("Congress has long recognized that
a number of problems peculiar to the railroad industry necessitate
separate treatment of that industry in various aspects, rather
than . . . leaving it subject to varied State laws, and to meet
that necessity has enacted such legislation as [the RUIA].").
Given that aim, it would have been nonsensical to preempt only
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state replicas of the RUIA while allowing dozens of divergent
schemes to proliferate. Instead, as is customarily the case, it
is the prospect of a clash between differing schemes that most
naturally precipitates preemption. See, e.g., Tobin v. Fed. Exp.
Corp., 775 F.3d 448, 455 (1st Cir. 2014) (applying preemption
clause of Airline Deregulation Act to avoid subjecting national
carrier to patchwork of state regulations in contravention of
clause's purpose); Danca v. Private Health Care Sys., Inc., 185
F.3d 1, 7 (1st Cir. 1999) (same with respect to ERISA and multi-
jurisdiction employer). And even if Congress were concerned only
about threats from copycats (such as disparate interpretation,
disparate enforcement, or duplicate liability), leaving the door
open to almost-but-not-quite copycats invites those same threats.
Nor are we persuaded by the Attorney General's second
and related textual argument based on the term "sickness periods."
Recall that the RUIA, pursuant to its preemption clause, "makes
exclusive provision . . . for the payment of sickness benefits for
sickness periods after June 30, 1947." 45 U.S.C. § 363(b).
According to the Attorney General, although the term "sickness
periods" is not defined in the statute, we should construe it to
mean times when the employee both is unable to work due to sickness
and is not receiving any remuneration from the employer. Working
from that assumption, the Attorney General contends that,
"[b]ecause [MESTL] sick pay by definition is pay from the employer,
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the necessary 'sickness periods' do not exist, and preemption
cannot occur." The United States presses the same argument. In
doing so on behalf of the Department of Labor, and not the Railroad
Retirement Board, which administers the RUIA, see id. § 362(l),
the United States makes no claim to any deference due. In any
event, this argument fares no better than the "sickness benefits"
argument we have already rejected. The appellants offer no sound
basis for conflating "sickness periods" with the specifically
defined term "period of continuing sickness," see id.
§ 352(a)(1)(B)(iii), and they fail to refute the natural reading
of the phrase "for sickness periods after June 30, 1947" as simply
providing an effective date for preemption.
The Attorney General's final stab at using the statutory
language to limit the scope of preemption relates to a
reimbursement provision in the Act. The provision empowers the
Railroad Retirement Board to reimburse a state that provides
sickness benefits to workers if the state takes railroad employment
into account in determining whether workers are eligible for state
sickness benefits or in setting the amount of such benefits. Id.
§ 362(g). In those circumstances, "the Board is authorized to
reimburse such State such portion of such . . . sickness benefits
as the Board deems equitable." Id. According to the Attorney
General, this situation could never arise unless Congress
"anticipate[d] the continued existence of State 'sickness
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benefits' and State 'sickness compensation law[s]' as applied to
railroads."
This point does not carry the force assigned to it by
the Attorney General. Section 362(g) deals with the "problem of
handling those workers who move between the railroad industry and
other employment." Hearings Before a Subcommittee of the Committee
on Interstate and Foreign Commerce on H.R. 10127, 75th Cong. 100
(1938) (statement of Horace Bacus); see also H.R. Rep. No. 75-
2668, at 11 (1938) (explaining that § 362(g) is a "special
provision . . . designed to overcome inequities that may arise in
the cases of persons regularly employed in the railroad industry
and also elsewhere"). So, for example, a person might work the
summer months for a railroad, and then the winter for a local
warehouse. If the worker becomes ill or injured during the winter,
the state may count all of his or her days of employment in
determining eligibility for state-provided benefits. There is no
suggestion, though, that the state itself may impose on the rail
carriers the cost of any benefits paid. Rather, § 362(g) grants
to the Railroad Retirement Board the discretion to reimburse the
state in such situations. The very fact that this discretion and
power is granted to the federal board by federal law thus
reinforces the fact that the federal law does not allow states of
their own accord to impose on interstate rail carriers, even
indirectly, the burden of providing state benefits. In short,
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nothing in § 362(g) suggests that there exists any authority
outside the "exclusive" reach of federal law for mandating the
provision of sickness benefits by interstate rail carriers. And
when reimbursements are in fact paid out, they are specifically
"included within the meaning of the word 'benefits' as used in
[the RUIA]," 45 U.S.C. § 362(g), thereby expanding rather than
contracting the scope of "sickness benefits" as the preempted
domain.
3.
The appellants next claim that various Railroad
Retirement Board publications demonstrate that the particular
sickness benefits provided under the RUIA do not include employer-
provided sick pay or sick leave. For example, the appellants cite
a publication noting that "[s]ickness benefits are not payable for
any day for which you receive sick pay from your employer."
(Quoting U.S. Railroad Retirement Board, Sickness Benefits for
Railroad Employees, Form UB-11 4 (2012),
https://www.rrb.gov/sites/default/files/2016-10/ub11.pdf.) This
sentence must mean, they say, that "sick pay" is not a "sickness
benefit" and that railroad workers can receive both. But the
quoted language simply describes how the RUIA sickness benefits
work; unsurprisingly, employees do not receive the benefits when
they are paid for their day off work. There is no reason to think
the preemption clause's use of "sickness benefits under a sickness
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law of any State" imports this exclusion. See 45 U.S.C. § 363(b).
Tellingly, the MESTL benefits likewise need not be paid if the
employer is already paying the employee pursuant to, for example,
a sick leave plan. See Mass. Gen. Laws ch. 149, § 148(C)(j)-(k).
The Board's recognition that a railroad worker might be eligible
for both sick pay and RUIA benefits absent some coordination of
benefits does not require a reading of the preemption clause that
places a state-mandated continuation of wages due to sickness
outside the clause's scope. In fact, the union intervenors point
to another Board publication that defines "sick pay" as
"compensation paid under a plan or agreement," not a state mandate.
See U.S. Railroad Retirement Board, Rail Employer Reporting
Instructions, Part IV - Particular Types of Compensation Payments,
Chapter 3: Sick Pay 1 (2012),
https://www.rrb.gov/sites/default/files/2017-06/RERI-
Part%20IV_CH%203.pdf.
4.
Implicitly acknowledging the problems with their effort
to derive a textually restricted definition of "sickness
benefits," the appellants and their amicus at times abandon any
textual argument in describing what is preempted. They argue,
instead, that RUIA preemption applies only to state benefits that
are "similar" or "comparable" to, or "of the type provided by[,]
the RUIA." Of course, in making this version of their argument,
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the appellants and their amicus are adrift: there is no anchor in
the text of the preemption clause for limiting in this manner the
type of state-mandated sickness benefits subject to preemption.
They moor, instead, to the context and purpose of the
preemption clause. This is a fair point, at least conceptually.
In construing a statutory provision that expressly preempts state
law, we do examine its purpose and context. See Medtronic, Inc.
v. Lohr, 518 U.S. 470, 485-86 (1996). Such an examination in this
case, though, simply reinforces our conclusion that, even if we
limit the preemptive reach of § 363(b) to state sickness benefits
that are "similar" or "comparable" to those provided by the RUIA,
the paid sick time mandated by subsection (c)(2) of the MESTL would
fit comfortably within that limitation.
The MESTL addresses the exact same problem that the
RUIA's provision of sickness benefits addresses: absent
legislation or agreement, an employer is not required to bear the
cost of providing any form of income to an employee who is not
working due to illness. The MESTL also settles upon a similar
type of solution: make the employer provide a source of income,
subject to various conditions and limitations. In this respect,
the appellants and their amicus overlook the fact that the status
quo ante, i.e., the state of affairs before enactment of either
law at issue, is that whether the employee receives pay during an
absence due to sickness hinges on the employment agreement. If
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that agreement requires full pay, neither the RUIA nor the MESTL
mandates anything more. Conversely, if no pay is required, then
the absence generally counts as a "day of sickness" under the RUIA,
and as a day on which the MESTL requires payment of earned paid
sick time. So, in this respect, the benefits are much more alike
than the appellants claim.
There are, of course, real differences between the
respective benefits. As we have explained, the formula used to
calculate the onset, duration, and amount of benefits, as well as
the manner in which the employer funds the benefits, differ. The
Attorney General concedes that such differences do not defeat
preemption as long as the state sickness law mandates an "RUIA-
like short-term disability insurance" as opposed to some "other
form[] of benefits." But it is unclear how, where, or why the
Attorney General draws the line between those schemes. The
Attorney General seems to argue that the dispositive factor for
preemption purposes is the method of payment: indirect employer
payments through an insurance fund are preempted, but direct
employer payments through a payroll system are not. We are not
persuaded that Congress cared only about the mechanism by which
burdens were placed on the employer to benefit the employee, and
not about the burdens themselves. After all, the statute expressly
refers to Congress's concern about the burdens. See 45 U.S.C.
§ 363(b). Nor are we persuaded that Congress crafted a preemption
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clause that a state could readily sidestep merely by burdening the
employer more directly. See Daboub v. Gibbons, 42 F.3d 285, 290
(5th Cir. 1995) ("[I]f the language of the act could be so easily
circumvented, the preemption provision would be useless, and the
policies behind a uniform . . . statute would be silenced.").
For these reasons, among others, we also reject efforts
by the United States to use the "historical context in which the
amendments were enacted" to limit the scope of the preemption
clause. According to the United States, when Congress added
sickness benefits to the RUIA in 1946, the only existing state
sickness laws required "a similar form of insurance for employees
unable to work for an extended period on account of illness or
injury." Because no state had passed "an earned-sick-time law" at
that time, the United States says, it therefore follows that
Congress had in mind only the existing state sickness laws when it
amended the preemption clause to bar "any right . . . to sickness
benefits under a sickness law of any State." 45 U.S.C. § 363(b).
Nothing in the text, however, indicates that Congress meant to
preempt all contemporaneous state sickness laws and their ilk, but
not any new variations. To the contrary, Congress stated its
intent to "make[] exclusive provision . . . for the payment of
sickness benefits." Id.
The Attorney General points out that the heading of the
RUIA's preemption provision, "Effect on State unemployment
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compensation laws," was not amended when the provision itself was
amended. As we explained earlier, Congress amended the RUIA in
1946 to add sickness benefits to the unemployment benefits it had
mandated in 1938. The Attorney General argues that, because
Congress made no revisions to the heading, it meant for the heading
to limit the preempted "sickness benefits" to only those sickness
benefits mandated by "unemployment compensation laws." But the
text of the clause makes plain that Congress knew how to limit
preemption to unemployment compensation laws, as it expressly did
in the context of the original benefits. See id. ("No employee
shall have or assert any right to unemployment benefits under an
unemployment compensation law of any State . . . ." (emphasis
supplied)). Congress chose different words to describe the
preempted domain for sickness benefits. Id. We reject the
Attorney General's effort to seek refuge from the force of the
statutory text and purpose in the short-hand heading. See Lawson
v. FMR LLC, 134 S. Ct. 1158, 1169 (2014) ("[T]he headings here are
'but a short-hand reference to the general subject matter' of the
provision, 'not meant to take the place of the detailed provisions
of the text.'" (quoting Bhd. of R.R. Trainmen v. Balt. & Ohio R.
Co., 331 U.S. 519, 528 (1947))).
We also reject the Attorney General's claim that the
MESTL does not tread "within the domain of 'sickness benefits'
preempted by [the RUIA]." Application of the MESTL to the
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plaintiff interstate rail carriers would directly alter the
balance struck by the RUIA in setting a minimum level of costs
that must be borne by such carriers to offset partially the
hardships to employees caused by an inability to work due to
sickness.
5.
As evidenced by the foregoing discussion, we find it
unnecessary to resolve the parties' debate concerning the nature
of any interpretative presumptions that might guide our analysis,
in particular the presumption against preemption. See Medtronic,
518 U.S. at 485 ("[B]ecause the States are independent sovereigns
in our federal system, we have long presumed that Congress does
not cavalierly pre-empt state-law causes of action."). Compare
Wyeth v. Levine, 555 U.S. 555, 565 n.3 (2009) (rejecting argument
that presumption against preemption does not apply in areas of
lasting federal regulation), with Brown v. United Airlines, Inc.,
720 F.3d 60, 68 (1st Cir. 2013) (rejecting application of
presumption against preemption in air-transportation context due
to "both longstanding and pervasive" federal regulation in that
field). The textual, contextual, and purpose-related cues all
point sufficiently strongly in the direction of finding that
§ 363(b) preempts subsection (c)(2) of the MESTL so as to overcome
any presumption that may apply. See Cuomo v. Clearing House Ass'n,
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L.L.C., 557 U.S. 519, 534 (2009) (finding presumption against
preemption immaterial in light of "plain terms" of federal law).
C.
Anticipating the possibility that we might agree with
the district court that the RUIA preempts subsection (c)(2) of the
MESTL as applied to interstate rail carriers, the Attorney General
and the union intervenors have asked us in the alternative to
determine whether any or all other sections of the MESTL might
still be applied to such employers. Resolving this issue of
severability raises three potential questions: (1) Are any of the
remaining sections of the MESTL themselves preempted by the RUIA?
(2) Are any remaining sections that are not so preempted
nevertheless preempted by either the RLA or ERISA as alleged in
the complaint? (3) Should any sections of the MESTL be preserved
by severing the preempted sections as applied to interstate rail
carriers?
The district court did not consider these questions,
perhaps because the Attorney General did not raise severability in
her summary judgment briefing. But the union intervenors raised
a severability argument in their memorandum below, and they press
severability as an alternative argument on appeal (as does the
Attorney General). It is, in short, a contention that was raised
below and preserved on appeal, certainly as to the union
intervenors. Nor do the plaintiff carriers argue otherwise.
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We often hesitate to address in the first instance issues
on which we lack the benefit of a district court's consideration.
See, e.g., United Parcel Serv., Inc. v. Flores-Galarza, 318 F.3d
323, 337-38 (1st Cir. 2003) (remanding, after affirming preemption
determination, for district court to resolve "three selected
issues" where submissions and arguments below adverted to, but did
not focus on, such issues). Issues can sharpen--or disappear--
when contested and resolved first in the district court. In this
case, we lack any answers to the three critical questions. The
need to consider each question, in turn, depends in part on the
answers to the other questions. For example, were it clear that
the MESTL is not severable, then our decision today would dispose
of the whole case. Conversely, were it clear that one of the other
federal laws preempted all of the MESTL, there would be no need to
decide severability. There is some chance, too, that an assessment
of all three questions might counsel in favor of certifying the
severability question to the Massachusetts Supreme Judicial Court.
We therefore decline to reach these questions in the context of
the present appeals.
III.
We hold that the RUIA preempts subsection (c)(2) of the
MESTL as applied to interstate rail carriers that employ workers
in Massachusetts. We remand for the district court to determine
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whether any or all other sections of the MESTL might be applied to
such employers. Each party shall bear its own costs.
Affirmed in part, vacated in part, and remanded.
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