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Title: Albertson's, Inc and Teamsters Local 537
Date: September 7, 2000
Arbitrator: Thomas Watkins
Citation: 2000 NAC 118

In the matter of arbitration between:



Denver, Colorado











                                                                                                   MILEAGE v. HOURLY PAY


                                                                                                        Juris Pencis, Grievant





                                                                                    Thomas L. Watkins, Arbitrator





            FOR THE COMPANY:


                        Holland and Hart, Attorneys, by Jim Goh

                        Bob Cook, Transportation Supervisor; Witness

                        Marty Mitchell, Transportation Manager; Witness

                        Brian Mumaugh, Attorney, Holland and Hart

                        Barbara Newell, Labor Relations Supervisor

                        Jed Pritchett, Jr., Vice President Labor Relations (Ret.); Witness


            FOR THE UNION


                        Berenbaum, Weinshienk & Eason, Attorneys, by Martin Buckley

                        Frank Ferri, Driver; Witness

                        Bob Luxner, Former Employee; Witness

                        Juris Pencis, Grievant; Witness

                        Mark Rosenau, Driver; Witness

                        Rudolph “Ted” Textor, Business Agent; Witness

                        Mike Thorfinson, Driver; Witness



HEARING HELD:  May 17 and July 6, 2000 in the offices of Berenbaum, Weinshienk & Eason, 370 Seventeenth Street, Denver, Colorado.


THIS PROCEEDING in arbitration was authorized by Article 18 of the Agreement between the parties dated April 5, 1998.  The Arbitrator was selected by the parties.


POST HEARING BRIEFS were timely filed by both parties on August 14, 2000.


The Employer [or Company], a grocery chain, operates stores throughout the Rocky Mountain region.  It maintains a Denver Distribution Center [DDC] for warehousing, opened in August 1982.  Believing that it could not compete with pay procedures identical to the established grocery chains, the Company began a practice of paying “long haul” drivers on a mileage basis, similar to the compensation scheme it had practiced in Salt Lake City.  Long haul drivers are those making runs outside a radius of 50 miles from the DDC, and they are paid a specific amount for each mile driven, plus stop pay and other set amounts for certain activities.  Local drivers, in contrast, receive an hourly rate of pay for each hour worked, due to the unpredictability of traffic problems, delays, etc., associated with in-town driving.  Language codifying this system of two driver categories and two pay methods was adopted into the first labor agreement signed in March 1983.  While the amounts paid have increased over the years, the language has remained essentially unchanged, as has the definition of “long haul:” deliveries or pickups which are outside a 50-mile radius of the DDC.

A combined run, i.e., one involving stops both inside and outside the 50-mile radius, is infrequent; ones involving a “back haul” are particularly rare, since they are normally done locally by hourly drivers, and by long haul drivers servicing other outlying locations exceeding 50 miles.  A “back haul” is one in which, after other duties, the driver takes an empty trailer to a site, then picks up a full one and returns to the DDC. 

The record establishes that when such a combined run involves a single trip packet (a set of assignments), the Company policy is to pay the entire run on a mileage basis.  Only if the driver completes the run and returns to the DDC to receive a second trip packet may the driver change from hourly to mileage (or vice versa). 

There is one notable exception to this practice: milk runs.  The dairy, located several miles from the DDC, is considered a second distribution center.  Therefore, it is common practice for a driver to make local runs early on his shift (receiving hourly pay), then report to the dairy.  There, he calls the DDC dispatcher.  He might receive a milk run that extends beyond the 50-mile radius and he would be compensated on a mileage basis.  In this example, the driver has made two runs even though he has not physically returned to the DDC.



Considering the controversial nature of the matter before us, the fact situation is remarkably free of dispute.  The Grievant, Juris Pencis, is one of the most senior drivers at the Denver Distribution Center.  On November 23, 1998 he was assigned a route (and received a trip packet) which included two stops within a 50-mile radius of the DDC to drop off produce, as well as a “back haul” from a processing facility in Ault, Colorado (some 80 miles away), i.e., he was to drop off his empty trailer and pick up a load of onions for a return to the DDC.  [Jt. Exs. 6, 7]  He called the dispatcher when leaving the local area and requested to be changed from hourly to mileage, but was informed that he was already on mileage.  He received pay on a mileage basis for the entire shift.  [Jt. Exs. 8, 9, 10]

Believing he was entitled to be paid on an hourly basis for the portion of his route that was within the 50-mile radius, which would have resulted in $46.16 of additional earnings, he filed a grievance the same day.  [Jt. Ex. 2]  It was processed through the grievance procedure [Jt. Exs. 3, 4, 5], denied by the Employer throughout, and is now stipulated to be properly before the Arbitrator for a decision on its merits.  The issue to be decided is framed as follows:

Did the Company properly pay the Grievant for his run on November 23, 1998 under the terms of the Collective Bargaining Agreement?  If not, what is the proper remedy?







            Section 3.1.  For the purpose of computing weekly overtime, the basic workweek, Sunday through Saturday, shall consist of forty (40) hours.  All time worked over forty (40) hours per week, as defined above, shall be paid for at the overtime rate of one and one-half (1½) times the employee’s regular straight-time hourly rate of pay. . . .




            Section 17.1.  The terms hereof cover the entire Agreement between the parties, and all rights not specifically abridged or limited herein, are reserved exclusively to the Company, regardless of whether or not such rights have previously been exercised by the Company. . . . . This Agreement contains all of the covenants, stipulations, and provisions agreed upon and no representative of either party has authority to make, and none of the parties shall be bound to a future course of conduct, practice or procedure by any statement, representation or agreement reached either prior to the signing of this Agreement or during its term, other than those set forth explicitly within the terms of this Agreement.  The language contained in this Article does not diminish or alter any individual statutory rights either party may have, but it may not be construed to incorporate any “past practice” as a term of this Agreement.




LONG HAUL DRIVERS (drivers making runs outside a radius of 50 miles from Aurora [Denver] Distribution Center) . . . . .[1]


On January 26, 1998 Arbitrator Marshall Snider rendered his decision in case involving Grievant Robert Grauberger and these same two parties.  There the grievant  received mileage pay for a run that included stops both inside and outside the 50-mile radius.  He contended he was entitled to be paid partly by the hour, and partly by mileage.  In terms of facts, the difference here is that for our Grievant, Pencis, it was a back haul rather than a delivery which took him outside of the 50-mile radius.

The Employer argues that the instant grievance should be barred by the doctrine of collateral estoppel:[2] (1) the issue is identical, (2) the parties are the same, (3) there was a full and fair hearing in the prior proceeding, and (4) there was a final judgment on the merits.  In contrast, the Union believes this case must be heard on its merits because (1) the facts are significantly different in the Pencis matter, (2) the Union only recently learned of the use of two time clocks, (3) Bob Luxner, whose testimony was crucial to establishing management’s pressure to change the routing to avoid overtime, was unavailable for the previous hearing, (4) the experience of other drivers was previously unknown, and (5) Snider based his decision on false and misleading testimony from the Company about the consistency of its practice, and upon a belief that the Company would not go to the trouble of creating mileage runs to avoid paying overtime, a belief that current evidence disproves.

The Union’s position is unpersuasive.  First, the facts and the issue raised in this matter are, in all material respects, identical.  Second, the Union had or certainly should

have been able to obtain information about time clocks, other drivers, and the practices of the Employer.  “Under res judicata, a final judgment on the merits of an action precludes the parties or their privies from relitigating issues that were or could have been raised in that action.”[3]  Even when called as witnesses, however, only one instance of “split pay for a single run” could be identified by drivers (Thorfinson on November 18, 1999), and even then the dispatcher was corrected for his actions. 

Third, Luxner’s unsubstantiated testimony did not establish that the Employer was artificially creating combination routes to avoid overtime, i.e., that the Company was simply “tacking on” a 50-mile-plus destination to an otherwise local run in order to avoid overtime, a practice the Union claims began in 1995 with the hiring of a new transportation manager.  In fact, the Company offered alternative, equally credible evidence that the practice has been consistent since the DDC was opened and that no change in practices occurred in 1995.  It also satisfactorily addressed the matter as to why growth patterns dictated different route structures resulting in combined runs.

While dispatchers do have discretion, there is no proof of manipulation to reduce overtime.  Thus at best one is left with vigorously disputed testimony.  This is not proof, especially in a matter where the burden is on the Union, as it is here.

The Union contends that Snider based his decision on false or misleading testimony, and that he “misunderstood the issue.”  But the record provides scant evidence to support a claim of misleading testimony in the previous hearing:  the Company testimony appears to be identical in both hearings.  True, it may have been uncontroverted in Grauberger; but although the Union here offered contra-testimony, that evidence fell far short of finding the previous Company testimony to have been  “misleading.” 

The Union also feels that Snider misunderstood the issues with which he was faced because he failed to grasp that a “run” really has nothing to do with whether one has a single trip packet or two trip packets (and therefore, in the Union’s judgment, each run must be compensated separately).  I believe Snider understood this fully, and he also understood that from the beginning the mutually accepted practice has been to consider one packet one run, irrespective of the number of stops it may involve, or where they happen to be located.  Indeed, it would appear he gave a full and fair hearing to this entire dispute.

I have very carefully studied all of the materials, testimony, notes and submissions on the instant case, especially the Grauberger decision.  I embrace Snider’s findings of fact, his conclusions and his logic in their entirety.  In the interest of stability in the relationship, arbitrators seek to abide by prior decisions involving same parties unless (1) the decision was made without benefit of some important and relevant facts, (2) the fact situation was clearly distinguishable, (3) relevant language has changed,[4] (4) a full and fair hearing was not afforded in the prior case, (5) the decision was based upon an obvious and substantial error of fact, or (6) the previous award was clearly an instance of bad judgment.  None of those elements are present here.

Where a new incident gives rise to the same issue that is covered by a prior award, the new incident may be taken to arbitration but it may be controlled by the prior award.  The destiny of a party’s claim thus may be governed by a prior award that either precludes the claim under res judicata concepts or controls the decision on the claim by stare decisis concepts.  In some instances arbitrators likewise have made the prior award the governing factor by application of a third judicial concept, collateral estoppel . . . . . However, regardless of whether the arbitrator speaks in terms of res judicata, collateral estoppel, or stare decisis, ordinarily the prior award by some procedure will have been the governing factor in the disposition of the present claim.[5]


It would serve no purpose to merely repeat the findings and conclusions contained in Grauberger.  Suffice it to say that pages 9-18 of that award are adopted herein by reference.  Thus, whether one wishes to consider this matter under the precepts of res judicata, or collateral estoppel or stare decisis, this matter is resolved.  If the Union is to modify this practice to its liking, it will have to do so in negotiations. 



The grievance of Juris Pencis is denied.




                                                            THOMAS L. WATKINS, Arbitrator


September 7, 2000

Frisco, Colorado



[1] The section goes on to specify the cents per mile, stop pay, meal and motel allowances, etc.  It is uncontested that drivers not designated as “long haul” are paid hourly, as specified in Appendix “A”.

[2] Although not a legal scholar in any sense, I believe this is more a matter of res judicata, but that technical distinction is irrelevant here.

[3] McCurry, 101 S.Ct. 411, 414 (1980).  Emphasis added by Elkouri and Elkouri reprint: How Arbitration Works, 5th ed., BNA, 1997, p. 609.

[4] In fact it is noteworthy that during the last negotiations leading to the present Agreement, the Union tried and failed to modify the language directly affecting the issue before us.

[5] Elkouri and Elkouri, id., pp. 609-10.

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