Title: Bell & Howell Co and IMMCO Employees
hearing in this matter was held in Allentown , Pennsylvania, on February 4 and
5, 1999. The spokesperson for Bell
& Howell Mail Processing Systems (hereinafter
the "Company") was attorney James A. Mills.
The spokesperson for the IMMCO Employees Association (hereinafter the
"Union") was attorney Quintes D. Taglioli. The witnesses for the Company were its former facilities
manager Christopher Reed; RMA senior security consultant Kile Unterzuber;
maintenance employees Larry Jones, William Holden, and Gordon Shively; facility
supervisor Fred Bass; and human relations manager Barbara Dota. The Union's sole witness was the grievant, John Fonseca
The joint exhibits were the collective bargaining agreement (J-1), the
grievance packet (J-2A&B), the discharge letter (J-3), and the plant layout
(J-4). The Company's 16 exhibits
included the 3/24/98 RMA report (C-1), the 4/8/98 Ontrack report (C-2);.the
4/14/98 meeting's notes (C-3); the 4/15/98 meetings' notes (C-6 thru C-9); the
5/6/98 meeting's minutes (C-12), the 1/8/99 RMA final report (C-13); and various
phone logs (C-15 & C-16). Per
the parties' agreement, posthearing briefs were submitted by 3/24/99, when the
Company manufactures mail processing machines at its Allentown plant.
The production and maintenance employees are represented by the Union.
9/22/80, the Company hired John Fonseca as a primary assembler.
After successful bids as an electrical worker in production, a technical
troubleshooter, and electrician in maintenance, he became a maintenance
technician. In this role, his duties included repairing and upgrading PCs
and installing wiring, servers, and communications lines for the Company's
network, but the priority was on repairing manufacturing equipment that broke
down. Among the maintenance team,
the division of duties was as follows: technical - him; electrical - Larry
Jones; general - William Holden and Gordon Shively.
All of them except Shively were on the day shift, which went from 6 am to
supervisor from approximately 1994 until August 1997 was Doug Blick, the
facilities manager at the Allentown plant.
In approximately 1994, the Company provided Blick with a new personal
computer (hereinafter referred to as the "Blick PC") for his office,
and Blick gave the team his old computer (hereinafter referred to as the
"maintenance PC") for use in their work area for the purposes of
energy management and maintenance information.
allowed Fonseca to use the Blick PC as well as the maintenance PC.
The Blick computer had access, via a dual booting procedure, to the
Company's intranet, or network, which was established in 1995-96.
The maintenance PC, apparently with Blick's permission, had access, via a
second, personal password, to Fonseca's personal Internet account, which
provided unlimited for a flat fee. The
other maintenance employees, who were not computer savvy, used the Internet
account to a negligible extent and only with Fonseca's direct assistance.
or about 8/15/97, Blick left the Company, and Fred Bass, a facility and safety
supervisor based at the Company's Raleigh/Durham, North Carolina, plant,
provided interim coverage of the maintenance department in Allentown.
He used the Blick PC for the limited periods that he was in the office
and did not expressly authorize Fonseca or any other maintenance employee to use
9/22/97 until 9/1/6/98, when he left the Company for employment elsewhere,
Christopher Reed served as the facilities manager in Allentown.
10/9/97, Reed had a meeting with Fonseca, who explained that Blick had allowed
him to take the Blick PC modem to use on the maintenance PC for access to his
personal Internet account for work-related purposes.
Reed agreed to allow him to continue this arrangement.
2/2/98, Reed accessed the maintenance PC for the first time and discovered
several hacking directories and a password-cracking system.
As a result, he changed the password to secure access to this information
and instructed Jones, Holden, and at least indirectly, when he came in on the
next shift, Shively not to touch the machine until further notice. Fonseca
was absent that day.
the morning of 2/3/98, Reed and Fonseca had a brief, inconclusive interaction
about the maintenance PC. That afternoon, Fonseca went into the maintenance office,
told one or more of the other maintenance employees that he was going to
retrieve his audio-board from the maintenance PC, and closed the door.
after the end of the shift, Reed returned and tried without success to turn on
the maintenance PC; the screen indicated a disk error.
He disconnected the PC and took it to the Company's PC technician, who
determined that something was wrong with the hard drive.
After consulting with the human resources manager, Reed decided to send
out the hard drive to recovery and security specialists.
He also contacted headquarters to have them monitor for security
2/5/98, Fonseca asked Reed what happened to the PC and when Reed informed him
that it didn't work, Fonseca replied: "You must have banged or dropped the
or about 2/15/98, Reed received the hard drive back from data recovery vendor
Ontrack along with a CD-ROM that contained the information recovered from the
He sent the CD-ROM to Risk Management Associates (RMA) for further
3/24/98, RMA issued a report that specified various downloading sessions,
including: 11/11/97 & 12/2/97 - NASCAR and sport-related Internet sites;
1/6/98 - hacking or cracking programs, a single pornographic photo; and
password-cracking software; and 1/29/98 - hacking (UNIX, PBX, and VAX) and
The report concluded that the
hacker files represented a low-level risk and that the "common problem ...
[of] unauthorized use of company resources for recreational surfing of the
Internet should be addressed by ... corporate policy."
4/8/98, Ontrack issued its report to the Company, finding that the hard drive
included, inter alia, "numerous documents with detailed instructions
on 'hacking' for PBX, VAX, and mainframe systems ..., documents
on picking locks, and random credit card number generator ..., and Wesbsites ...
HackShack and www.tordata.se/hokum/, both of which have numerous
documents available for downloading that refer to hacking or accessing
anonymously many different types of systems."
4/14/98, in the presence of the human relations manager and Union
representatives, Reed interviewed Fonseca regarding alleged "unauthorized
and inappropriate information on the maintenance PC."
Fonseca denied copying or downloading any information or software to the
maintenance PC, including hacking, lock-picking, or password-breaking data.
Later that day, the Company issued a memo to Fonseca, suspending him
"pending completion of investigation" for "serious misconduct
involving the use and abuse of the Company's computer."
4/15/98, RMS informed Reed that its preliminary review of the CD-ROM contained
several e-mail messages attributable to Fonseca's e-mail address.
On that same day, in the presence of the human relations and Union
representatives, Reed separately interviewed Holden, Jones, and Shively.
They all confirmed that Fonseca was the only one who accessed his
Holden and Jones, who were the only
ones present at the time, concurred that Fonseca apparently touched the
maintenance PC, after Reed's directive to the contrary, for the ascribed purpose
of retrieving his sound-board. Jones reported that he had seen Fonseca downloading
lock-picking information from the Internet and that, on another occasion,
Fonseca had supposedly said that he'd like to try to break into the Company's
computer system just to see if he could do it.
4/20/98, again in the presence of Company and Union representatives, Reed
re-interviewed Fonseca, who continued his denials except to the extent of
admitting that he "may have downloaded, don't know" some information.
5//1/98, Reed had a Company specialist examine the Blick PC, revealing that
someone had installed on it nonstandard, or rogue, software.
5/4/98, with Company and Union witnesses, Reed interviewed Fonseca, who
responded that he was "not sure" whether he had his Internet account
on the Blick PC.
Reed also reported that the
Company had found no security breaches to its system.
5/6/98, after a meeting for this purpose, the Company terminated Fonseca for
abuse of Company property,
plus lacking honesty and remorse in the investigation.
At the time, the Company had no written policy on computer use.
5/6/98, Fonseca filed a grievance, alleging that his suspension and subsequent
termination were without just cause and, thus, in violation of the CBA.
- GENERAL TERMS
The sole and exclusive rights of Management which are not abridged by
this Agreement shall include ... to suspend or discharge employees for proper
cause, subject to the grievance procedure....
An employee's ... employment relationship with the Company shall
terminate when an employee ... is discharged for justifiable cause....
the Company have proper or justifiable cause for terminating the Grievant?
If not, what shall the remedy be?
this case, the insubordination charge is weakened by the lack of a Company
policy and the less than complete directive from the supervisor Reed,
particularly in light of the prolonged, relaxed position of former supervisor
Blick. Reed was too absolute to be
For example, he testified that he first issued the directive on 2/2/98 to
not only Jones and Holden, but also Shively.
Yet, Shively's testimony was that he learned about it from Jones and
Holden. Similarly, Reed testified
that he issued the directive on 2/3/98 to the grievant not only at 7:30 am but
also at 10:30 am when the grievant asked him why the maintenance PC would not
respond to his password. Yet, if he
had instructed the grievant at 7:30, there would have been no reason for him to
have tried his password and ask Reed why it was not working.
It is just as believable that Reed did not directly and specifically tell
the grievant about his no-touch directive until the end of the day.
inference, however, does not excuse the grievant's action that day.
Even if Reed did not tell him not to touch the maintenance PC until after
the damage was done, one can objectively conclude that Jones and Holden told him
during that day, before he entered and closed the interior maintenance office,
of Reed's directive. The evidence
is also relatively clear that the grievant damaged the hard drive in an attempt
to cover his tracks. He had the
requisite motive, opportunity, and knowledge.
The odds of the machine just happening to malfunction in such a dramatic
way in the relatively brief and isolated interim between Reed's discovery and
his return to retrieve it are much too remote, particularly when there was no
damaging electrical charge to any other device in the environs.
The grievant's conclusory comment about the physical trauma being the
source of the problem was all too correct.
as to the first charge, the grievant engaged in misconduct, but it was not clear
insubordination. Rather, it fits better with the second charge, abuse of
Company property, along with the referenced 1) downloading inappropriate
materials that had no business-related purpose and, in part, were potentially
harmful and 2) unauthorized use of the Blick PC.
unauthorized use of the Blick PC is unsubstantiated in light of 1) the credible
testimony about Blick's relaxed regime with regard to the grievant's use of PC's
and 2) the outside reports revealing that the inappropriate items were
relatively limited and all pre-dating Reed's regime.
The downloaded materials in the maintenance PC were more serious in scope
and timing, but not as serious as Reed's reaction, or the Company's
characterization, for several reasons. First,
as the Company's expert testified, part of the downloading was merely
attributable to viewing information on the PC.
What was more serious in terms of its potential use and impact but more
limited in its actual extent in terms of the grievant's action was preserving
the information on site, via compressing or printing it. Second, there was no evidence of a security breach or of an
intent on the grievant's part to interrupt or otherwise do damage to the
Company's proprietary functioning.
The Company had reason for action, but not overreaction.
Third, as the outside report concluded, these materials constituted a
relatively low-level risk, and the "common problem ... [of] unauthorized
use of company resources for recreational surfing of the Internet should be
addressed by ... corporate policy."
relatively low level of risk and the lack of a Company policy mitigate but do
not excuse the grievant's conduct. In
line with the third charge, the arbitrator finds that the grievant was indeed
dishonest during the investigation. Although
it is not unusual for a person to be defensive or evasive in the face of charges
of misconduct, including denials and cover-ups, such behavior can compound the
problem in comparison to the partially mitigating effect of fully and promptly
owning up to one's missteps. Although an express Company policy would have
provided clearer boundaries in terms of contents and consequences, the grievant
had reason to know that what he had not only accessed but preserved on Company
property and Company time was subject to at least moderate discipline and his
unduly smooth and almost arrogant attitude in the various investigatory
interviews and in his testimony, although not here an independent basis for
discharge, gives all the more reason for strong, corrective discipline.
moving to the second aspect of justifiable or proper cause, the arbitrator
concludes, not without reservation in giving due regard for managerial
discretion, that termination is not quite warranted in this case. Rather,
although the Company's investigation was certainly thorough and fair, the
cumulative mitigating effects were 1) the lack of a specific policy, 2) the
proven degree of seriousness of the offenses, and 3) the grievant's long and
valuable service to the Company.
In light of the grievant's abuse of Company property and disavowal
of responsibility, a sustained suspension is warranted, clearly extending beyond
the intervening year so that the grievant has the time and incentive to realize
and correct the almost fatal position in which he put himself.
Specifically, the Company shall reinstate the grievant on 8/14/99,
without any back-pay or benefits. The
intervening period shall serve on his record as a suspension and final warning.
 Fonseca did not have a audio-board on the PC at the time. In his testimony, he admitted telling them that he was going into the office for this purpose but, instead, used the phone there to call home.
 In assessing the potential business impact, the report included a copy of a Pennsylvania statute the makes it a crime, inter alia, to "access [or] damage any computer ... with the intent to interrupt the normal functioning of an organization." 18 P.S. § 3933.
 Holden also admitted seeing information downloaded from the Internet; the reasonable inference, in the context, was that he was likely referring to Fonseca. Additionally, although he did not report it at the time, Shively testified at the hearing that he had observed Fonseca downloading NASCAR information from the Internet.
This software should have, at no time been loaded or installed on
any company owned machine.... [T]he individual(s) that were using these tools had the skill or technical breadth to compromise
our systems corporate wide.... The bottom line is that ... all the
applications or programs found were rogue and should have
never been on or network....
RMA's final report, which was issued on 1/9/99, revealed that this software had been installed on 9/10/97.
 Based on phone logs and testimony, the evidence is preponderant that Fonseca accessed his Internet account from the Blick PC between 8/22/97 and 9/19/97, including six sessions of exceeding 29 minutes.
 The termination letter explained this charge in terms of "downloading [during work time] inappropriate materials from the Internet which had no business-related purpose, and, in some cases, had the potential to harm the Company." It also added the unauthorized use of the Blick PC.
 On 4/24/98, he had also separately grieved his 4/14/98 suspension. It is understood that the 4/24/98 grievance is merged into the scope of the 5/6/98 grievance. Subsequent to the grievance, specifically on 1/8/99, RMA submitted a report on its analysis of the hard drives from the Blick PC, revealing a few nonbusiness-related items, such as NASCAR images, with none dated after 9/20/97.
 There is no significant difference between these phrases; they are understood to be among the various terms for the concept most often called "just cause." See, e.g., ELKOURI & ELKOURI, HOW ARBITRATION WORKS 887 (M. Volz & E. Goggin eds. 1997).
 See, e.g., MARVIN HILL & ANTHONY SINICROPI, MANAGEMENT RIGHTS 98 (1986). In Daugherty's famous seven criteria, items 1-6, which include the Employer's forewarning and investigation, relate largely to the first aspect, while the second aspect is addressed by item 7: "Was the degree of discipline ... reasonably related to (a) the seriousness of the employee's proven offense and (b) the record of the employee in his service with the Company? See, e.g., Enterprise Wire Co., 46 Lab. Arb. (BNA) 359 (1966)(Daugherty, Arb.).
 Although obviously competent and conscientious, he had a tendency to overstate the facts. His assertion that the Company had an applicable policy exemplified his otherwise admirable posture; he was by-the-book even when there was no book.
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