States’ Wage Law Immunity Curbed : Court’s Action on Transit System Pay May Affect All Governmental Workers

The Supreme Court, widening federal authority over the states, Tuesday reversed a landmark 1976 decision and ruled 5 to 4 that the federal government could impose minimum wage and overtime laws on transit systems operated by state and local agencies.

The decision specifically paves the way for increased federal control over the wages and hours of all state and municipal employees--an action that could prove costly to taxpayers and transit riders as new revenues are required to support higher labor costs.

The ruling removes an 8-year-old legal precedent that had proved one of the few barriers to the far-ranging power of Congress to force state and local agencies to comply with federal laws.

Difficult to Implement

The court majority concluded that the 1976 ruling--which had exempted fire and police services, sanitation and other “traditional” state functions from such federal regulation--had proved too difficult to implement, producing confusion among the lower courts as they tried to apply it to a wide range of governmental services.

State and local government officials reacted to the court’s decision with anger, disbelief and uncertainty, and some asserted that it could have a ruinous impact on their budgets.

“This is a very shocking document,” former Transportation Secretary William T. Coleman, now legal counsel for the American Public Transit Assn., said as he thumbed through the ruling.

However, labor union officers applauded the decision and said that it cures an obvious injustice.

“We are pleased that the Supreme Court has ruled that public employees should have the same rights and protections as all other workers covered by federal wage and hour laws,” said Gerald W. McEntee, president of the 1.1-million-member American Federation of State, County and Municipal Employees.

Public transit officials contended that the decision would cost local systems at least $100 million a year in higher overtime pay and administrative expenses. Many bus and subway drivers work split shifts--the morning and evening rush hours--and transit systems often pay them less than the federally required time and a half for their hours between shifts.

Switches Sides

Justice Harry A. Blackmun, who had voted with the 5-4 majority that had issued the 1976 decision, switched sides and ended up writing Tuesday’s majority opinion. The previous ruling, he said, “tried to repair what did not need repair.”

“We therefore now reject, as unsound in principle and unworkable in practice, a rule of state immunity from federal regulation that turns on a judicial appraisal of whether a particular governmental function is . . . ‘traditional,’ ” Blackmun said.

The court said that the part of the Constitution giving the federal government power to regulate interstate commerce may extend to whatever activities Congress decides to regulate.

Dissenters expressed dismay at the court’s unusually abrupt reversal of itself, saying that it undermined the stability of judicial decision making. Although the court on occasion reconsiders and overrules itself, few reversals have been rendered so quickly, they pointed out.

Justice Lewis F. Powell Jr., in an opinion joined by Chief Justice Warren E. Burger and Justices William H. Rehnquist and Sandra Day O’Connor, argued that the new decision reduced constitutional guarantees of state sovereignty to “meaningless rhetoric.” The ruling, they said, effectively authorized federal control over the wages and hours of all state and local employees.

“Members of the immense federal bureaucracy are not elected, know less about the services traditionally rendered by states and localities and are inevitably less responsive to recipients of such services than are state legislatures, city councils, boards of supervisors and state and local commissions, boards and agencies,” Powell wrote.

‘Core’ Activities

The 1976 decision, issued in a case called National League of Cities vs. Usery, represented a big victory for the states. The court said then that the 10th Amendment, which gives the states all powers not specifically given to the federal government, barred the application of federal wage and hour laws to “traditional” or “core” state and local activities.

Since then, lower court rulings had differed markedly over which state and local functions were immune from federal regulation under the 1976 ruling. Airport operations, waste disposal and the licensing of motorists, for example, have been held subject to federal control. But issuing industrial development bonds, regulating traffic on public roads and operating mental health facilities have been held beyond the ruling’s scope.

‘Wait and See’

Jerry Selmers, assistant administrative officer for the city of Los Angeles, said that it is too early to tell what effect the court ruling would have on the city. “If there is any impact, it would be on the overtime provision, but we’ll just have to wait and see,” he said.

A spokesman for the Southern California Rapid Transit District said that the 5,000 RTD drivers earn an average of $11.90 an hour, well above the $3.35 federal minimum wage, and get time and a half for overtime.

Bill Stewart, senior assistant counsel for Los Angeles County, said that the ruling might affect overtime pay for the nearly 2,000 firefighters and 6,000 sheriff’s deputies who had been exempted from federal labor regulations.

The new case arose from San Antonio, Tex., where local public transit authority officials challenged an attempt by the Department of Labor to make the system comply with the minimum-wage and overtime requirements of the Fair Labor Standards Act.

Defining Functions

In Tuesday’s decision (Garcia vs. San Antonio Metropolitan Transit Authority, 82-1913), the court majority concluded that it was “difficult, if not impossible,” to define the extent of the governmental functions covered by the 1976 decision. Any decision using such vague terms “inevitably invites an unelected federal judiciary to make decisions about which state policies it favors and which ones it dislikes,” Blackmun observed.