106 | 2023 Cal-Peculiarities ©2023 Seyfarth Shaw LLP www.seyfarth.com defendant suffered no prejudice because the class actions provided adequate notice of the plaintiff’s potential claims.270 5.7.6 Statute of Frauds not a defense Plaintiffs suing for breach of a contract of continued employment, requiring good cause for dismissal, often rely on alleged oral promises made many years ago, by managers no longer with the employer. The Statute of Frauds, found in virtually every state, generally provides that a contract must be in writing to be enforceable, if by its terms the contract is not to be performed within one year from its inception.271 One might think that an oral contract of continued employment, contemplating performance for a period of more than one year, is subject to the Statute of Frauds. Not so in California. The California Supreme Court has held that the Statute of Frauds defense is unavailable in an employment case because an oral employment contract could possibly be completed within one year, in that, within one year, the employee could quit or die or be fired for good cause.272 The Supreme Court’s reasoning thus relied on the possibility of a first-year failure of performance of an oral employment contract, even though the Statute of Frauds itself addresses only actual performance of the contract.273 5.7.7 Federal labor preemption generally not a defense Limited effect of LMRA preemption. Employers sometimes argue that a state law claim is preempted by Section 301 of the Labor Management Relations Act and thus must proceed, if at all, only as a claim under the collective bargaining agreement governing the terms and conditions of the plaintiff’s employment. But in California this defense fails when the claim arises, as it typically does, under independent state law that does not require interpretation of the CBA.274 The Ninth Circuit has held that even where applying the CBA terms might affect the outcome, no preemption applies if one need only “look at” the terms of the CBA.275 Limited effect of RLA preemption. See § 7.7.8. Limited effect of NLRA preemption. Under NLRA preemption, as the U.S. Supreme Court explained in San Diego Unions v. Garmon, the NLRB has exclusive jurisdiction over disputes involving unfair labor practices, requiring state jurisdiction to yield when “state action would regulate conduct governed by the NLRA.”276 Because the NLRB decides whether the NLRA governs conduct, NLRA preemption may extend beyond conduct that the NLRA directly governs to activities that “arguably” constitute unfair labor practices. In a 2020 case, the Court of Appeal rejected an employer’s NLRA preemption defense to employee claims that the employer’s confidentiality policies unlawfully prevented employees from sharing information about wages, working conditions, and corporate wrongdoing, and from engaging in competition.277 The trial court invoked NLRA preemption to dismiss the lawsuit, but the Court of Appeal reversed, holding that the plaintiffs’ claims fell within the “local interest” exception to NLRA preemption.278 That exception applies if (1) there is “a significant state interest” in protecting the citizen from the challenged conduct, and (2) the exercise of state jurisdiction entails little risk of interference with the NLRB’s regulatory jurisdiction.279 Both conditions appeared here, the Court of Appeal thought, where the plaintiffs cite state statutes on traditional matters of local concern, which reasonably seem peripheral to the NLRA.280 States may set minimum employment standards without running afoul of the NLRA, and state violations alleged by the plaintiffs could be proven without considering whether the employer committed unfair labor practices.281 5.7.8 Limits on defensive cross-complaints One weapon in an employment defendant’s arsenal is a cross-complaint filed against the plaintiff for the plaintiff’s own actionable conduct. California limits the effectiveness of such a cross-complaint, however, by authorizing a specialized motion—an “anti-SLAPP” motion—which permits a plaintiff to argue that a cross-complaint should be stricken on the ground that it is simply a litigation tactic.282
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