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Title: Graphic Packaging International and Association of Western Pulp and Paper Workers
Date: August 14, 2004
Arbitrator: David Gaba
Citation: 2004 NAC 146

Federal Mediation and Conciliation Service


In the Matter of an Arbitration





(Extrusion Labor Pool Staffing)







This arbitration arises pursuant to a collective bargaining agreement (hereinafter the AGREEMENT) between the ASSOCIATION OF WESTERN PULP AND PAPER WORKERS, LOCAL 78 (hereinafter the UNION), and GRAPHIC PACKAGING INTERNATIONAL, INC. (hereinafter the COMPANY or EMPLOYER), under which DAVID GABA was selected to serve as Arbitrator and under which his Award shall be final and binding among the parties.

A hearing was held before Arbitrator Gaba on May 13, 2004 at Portland, Oregon.  The parties had the opportunity to examine and cross-examine witnesses, introduce exhibits, and fully argue all of the issues in dispute.  A transcript of the proceedings was provided.  Both parties filed post-hearing briefs on July 23, 2004.


On behalf of the Union:

Thomas K. Doyle
Bennett, Hartman, Morris & Kaplan
851 S.W. Sixth Avenue  
Suite 1600
Portland OR  97204-3627

On behalf of the Company:

Jerry S. Nicholson
Graphic Packaging International, Inc.
P.O. Box 35800
West Monroe LA  71294-5800


During the period of time relevant to this Arbitration, the Association of Western Pulp and Paper Workers, Local 78 and Graphic Packaging International, Inc. were parties to a collective bargaining agreement dated March 1, 2002 through February 28, 2006.

The Union and the Company did not stipulate to the issues, but rather advocated different wording of the issues.  The Union formulated the issues as follows:

                     1.  Was the processing of the grievance timely?

                     2.  Did Graphic Packing violate the collective bargaining agreement when it classified workers in the rewind position of Extruder #3 as “labor pool” rather than “helpers”?

The Company formulated the issues as follows:

                     1,  Was the grievance filed in a timely manner in accordance with Section 17, Handling of Complaints and Arbitration, of the current Labor Agreement?

                     2.  If so, is the “Letter of Understanding” entered into between the Company and the Union on August 2, 2002 a valid and binding agreement?

                     3.  If not, did the Company violate Section 3, Management, of the current Labor Agreement by assigning the work on Extruder #3 to an Operator, Helper and Labor Pool employee as contended by the Union in its grievance?

The Arbitrator has determined the issues to be:

                     1.  Was the grievance filed in a timely manner in accordance with Section 17, (Handling of Complaints and Arbitration) of the current Labor Agreement?

                     2.  If so, is the “Letter of Understanding” entered into between the Company and the Union on August 2, 2002 a valid and binding agreement?


The “AGREEMENT Between GRAPHIC PACKAGING CORPORATION, North Portland Plant, And THE ASSOCIATION OF WESTERN PULP AND PAPER WORKERS acting through its North Portland Local Union No. 78”[1] contains the following policies that are relevant to this Arbitration:


        1.1            THIS AGREEMENT, made and entered into this 11th day of March, 2002 by and between North Portland Plant of Graphic Packaging Corporation, which is hereinafter called “Company,” and THE ASSOCIATION OF WESTERN PULP & PAPER WORKERS, hereinafter called “Union”, acting through its North Portland Local Union No. 78.  The purpose of this agreement is to promote and maintain mutually satisfactory industrial and economic relationships between the Company and the Union which will further to the fullest extent possible the safety and welfare of the employees, economy of operations, quality and quantity of output, cleanliness of the plant and protection of the property.  Both will abide by this agreement, it being their purpose to settle all differences without disturbance to industrial peace.


        2.1            The Company recognizes the Union as the sole collective bargaining agent for the employees covered herein as to wages, hours and working conditions.  The term “employee” as used in this agreement shall include all production and maintenance employees of the Company employed at its North Portland, Oregon plant and any expansion or relocation thereof within a fifty (50) mile radius of the present plant site, but shall not include office employees, clerical employees, research employees, sales personnel, administrative e4mployees, professional employees, guards and supervisors as defined in the Act.

        2.2            Neither the Company nor any supervisor shall have any private understanding or agreement with any individual employee or group of employees in conflict with this agreement.


        3.1            The management of the plant and the direction of the working forces, including the right to hire, suspend or discharge for just and sufficient cause, transfer and the right to relieve employees from duty because of lack of work or for other legitimate reasons, the scheduling of work and assignment of employees to such work, the control and regulation of all equipment and other property of the Company and the determination of the quality and quantity of work to be produced, are vested exclusively in the Company.  Except as provided in the following sentence of this Section 3, this enumeration of management prerogatives shall not be deemed to exclude other prerogatives not herein enumerated.  However, nothing contained in this section shall be applicable if inconsistent with any of the other terms of this agreement.  The Company shall not exercise any of its management prerogatives for the purpose of discrimination against any employee.  Disputes arising under this section shall be subject to the grievance procedure set forth in Section 17 hereof.

        3.2            The Union has all rights which are specified in the subsequent sections of this agreement and retains all rights granted by law except as such rights may be limited by provisions of this agreement.

        3.3            The Company retains all rights except as those rights are limited by the subsequent sections of this agreement.  Northing anywhere in this agreement (for example, but not limited to, the recognition and/or arbitration sections) shall be construed to impair the right of the Company to conduct all of its business in all particulars except as modified by the subsequent sections of this agreement.

        3.4            The failure of the Union to enforce any of the provisions of this agreement or exercise any rights granted by law or the failure of the Company to exercise any rights reserved to it or its exercise of any such right in a particular way shall not be deemed a waiver of such right or a waiver of its authority to exercise any such right in some other way not in conflict with the terms of this agreement.


        6.2            The Company agrees that in granting promotions, transfers, laying off, recalling employees . . .  For seniority purposes the classifications of bundlers, roll wrappers, (offbearer/packer), and shall be considered Labor Pool –not in departments.


        10.2.         It is the intent of both the Company and the Union that employees in progression shall, during the progression period, receive as much experience in their trade as it is practical for the Company to give them without making extra work.  To this end, there shall be no restrictions on classification work assignments.

        10.3          If the employee in progression does not make satisfactory progress during his/her progression period, he/she may be transferred to the labor pool.  An employee in progression who has the seniority and qualifications to be promoted must accept the promotion when offered to him/her except for a good and valid reason acceptable to and mutually approved by the Company and the Union Standing Committee, and failing to accept same, he/she will be assigned to the labor pool.  It is the intent of the parties that employees in progression shall work during the entire progression period.  It is also the intent of the parties that employees shall actually work on the job involved an average of at least one hundred forty-four (144) hours per month during each progression period before he/she may advance to the next step.

        10.4.         It is the desire of both parties to move helpers into progression to provide for vacancies as they may occur in the ranks of journeymen, but the Company is not precluded from hiring journeymen from the outside, provided it first explains to the Union Standing Committee the reason for doing so.  The Company will post on the bulletin board a notice advising employees of the existence of a job opportunity in the Maintenance Department before hiring maintenance employees from outside the plant.

        10.12.       If during the term of this agreement new job classifications are created, the Company may voluntarily determine the rate of pay for the new job classification and shall send written notification of such rate to the Union Classification Committee within one (1) working day of the implementation of such rate.  If the union fails to protest such rate within sixty (60) days of such notification, the rate established by the Company will become the permanent rate for the new job classification.  If the Union does protest the rate set by the Company it will be referred to the joint Job Classification Committee who will meet within fourteen (14) days to process the complaint in accordance with the procedure set forth in paragraph 10.13 of this Section 10.  The permanent rate so established, if higher than the temporary rate, established by the Company shall be retroactive to the date on which the employees were assigned to work in the new classification.

        10.13.       There shall be Classification Committee consisting of Union and Company representatives.  The Company representatives shall be appointed by the Company.  The Union representatives shall be appointed by the Union.  The Classification Committee shall meet within 14 days of notification by either party.  The Classification Committee shall have the authority to establish new occupations and new classification whenever they mutually agree that such action is desirable or necessary.  If, during the term of this agreement, the Company makes sufficient change in the job content of an existing job classification listed in Section 10 or a classification added to Section 10 during the term of this agreement the Classification Committee may agree to make an appropriate adjustment in the wage rate of such occupation or classification.  If the Classification Committee fails to agree on any such matter, it may be submitted for consideration in subsequent labor contract renewal negotiations and shall have an effective date as agreed upon in those negotiations, but shall not result in a charge against the cost package of contract improvements in those negotiations.

        10.14.       The Union Committee shall be privileged to present recommendations to the Company regarding the manning in the new job classifications, which recommendations will be considered by the Company prior to making its decision with respect to manning, it being understood that management’s decision in this regard shall be final.  After the Company has determined the manning questions, the further question of who will work in the new job classification will be determined in accordance with the seniority provisions of this agreement.


















Year 1





Year 2





Year 3










   6     EXTR. HELPER (Existing Dept. ees 3/11/02)





   7     EXTR. HELPER (Existing Plant ees 3/11/02)





   8     EXTR. HELPER (Hired after 3/1/02)















LABOR POOL (Open Classifications)

  30     Labor Pool (Hired Prior to 3/11/02)





  31     Labor Pool (Hired On/After 3/11/02)







        17.2          The Union shall select from its membership a Union Standing Committee of at least three (3) employees, one of whom shall be the chairman.  The Union also shall select shop stewards who shall represent the employees in the plant for the specific purposes stated in this section.

A representative of the Union shall be entitled to sit with the Union Standing Committee.

        17.3          The Company shall appoint a Company Committee of at least three (3) employees which shall represent the Company for the purposes stated in this section.

        17.4          Either the Union Standing Committee or the Company Committee shall have the right to have any individual necessary for purposes of advice or consultation present at joint grievance or disciplinary meetings as set forth is this sections.

        17.5          Grievance Procedure-

Should there be any dispute, complaint or grievance of any employee of the Union, herein collectively referred to as grievances, the following procedure shall apply:

        17.51        Informal Stage:

Any employee having a grievance shall first discuss it with his/her supervisor.  A shop steward may take part in the discussion with the supervisor or handle it with the supervisor alone if the aggrieved employee so requests.

This discussion shall take place within seven calendar days after the grievance becomes known to the employee.  The two parties shall make an honest effort to settle the grievance; such settlement shall not be inconsistent with the terms of this agreement.

Settlement of any unwritten grievance presented informally to the supervisor shall not be used by either party as a precedent for later disputes, complaints, or grievances.

        17.6          Step One – Formal:

If the employee cannot achieve resolution to their grievance, then he/she may present it as a formal grievance.  If a formal grievance is presented, it must be submitted in writing within 10 calendar days of the date it was first discussed with the supervisor.  The supervisor shall answer the grievance in writing, within seven (7) calendar days, with a copy to the appropriate shop steward as to the reason for approving or denying the grievance.

        17.7          Step Two – Committees

The Union Standing Committee shall make a timely investigation and decide whether the grievance shall be carried further.  If the Union Standing Committee decides to proceed with the grievance it shall notify the Company Committee in writing.  The two shall meet within ten (10) calendar days of the request.  The matter shall be discussed and every effort made to settle the grievance.  The Company Committee shall answer the grievance in writing within seven (7) calendar day of the meeting.

        17.8          Step Three- Plant Manager

If the Union Standing Committee is not satisfied with the results at the second step, in order to proceed with the grievance the Union must notify the plant manager within ten (10) calendar days of receipt of the second step answer.

The Union Standing Committee shall then discuss, within 30 calendar days, the grievance with plant manager in an honest attempt to settle the grievance.

The plant manager shall answer the grievance in writing within seven (7) calendar days of the meeting, giving the reasons for approval or denial.

        17.9          Arbitration

If the discussion between the plant manager and the Union Standing Committee does not result in a satisfactory settlement, the Union may by written notification, submit the grievance to arbitration.  The Union must submit the grievance to arbitration within forty-five (45) days from the plant managers written denial.

        17.13        Arbitration Procedure

Matters to be submitted to arbitration shall be referred to an arbitrator to be chosen by the Company and the Union.  In the event the Union and the Company cannot agree upon the selection of an arbitrator, they shall apply jointly to the Federal Mediation and Conciliation Service for list of seven (7) persons.

Promptly after the list is received, the Company and the Union shall strike names from the list in the following manner.  The Company and the Union shall determine by lot the order in which they will strike names and thereafter each shall in that order alternately eliminate one name until only one name remains on the list, and that person whose name remains on the list shall become the impartial arbitrator.

The arbitration hearing will be convened as expeditiously as possible to render a decision.  In matters destined for arbitration, if the parties can agree to facts concerning the grievance involved, the facts agreed upon shall be reduced to writing and signed by the parties.  The Union and the Company may agree to a stipulated arbitration hearing.

The written decision of the arbitration shall be final and finding upon the parties.  If the arbitrator determines that an employee was unjustly terminated and back pay is awarded, the back pay award shall not exceed six months of lost straight time earnings.  Any unemployment benefits received shall be deducted from such amount.

The arbitrator shall have no power to add to or subtract from or modify any of the terms of this agreement.

The expenses incident to the services of the arbitrator, court reporter and the meeting place shall be shared equally by the Company and the Union.  In the event the arbitrator’s services are cancelled without a resolution to the grievance, the party canceling shall be responsible for any cancellation fees.


        19.1          The parties hereto believe that each and every provision of this agreement is lawful.  However, if any provision of this agreement is or should become in contravention of the laws or regulations of the United States or of the state in which the plant covered by this agreement is located, such provision shall be superseded by the appropriate provisions of such laws or regulations, so long as such laws or regulations remain in force and effect, but all other provisions of this agreements shall continue in full force and effect.  If the parties are unable to agree as to whether or not any provision hereof is in contravention of any such laws or regulations, the provisions hereof involved shall remain in effect until the disputed matter is settled by the court or other authority having jurisdiction in the matter.

Letter of Understanding-Current Extrusion Dept. Employees

The following is an understanding between AWPPW Local 78 and Graphic Packaging Corporation North Portland facility.

Current qualified operators will be allowed to keep their shift preference and take the helper rate.  The choice to be an operator or helper will be allowed on a yearly basis (approximately Jan. – Dec.).

Union and Management will work together to develop a system to protect seniority and shift preference.

Department seniority will not be affected.

Management reserves its usual and customary rights.


The North Portland Plant of Graphic Packaging International manufactures paper products.  Most employees at the Plant are assigned to specific departments on a permanent basis, but the Plant also has employees assigned to a Labor Pool who are delegated to different departments as needed.  The Agreement was revised for 2002-2006 to include language designating the Labor Pool job classification as a general “Open Classification” to confirm established practice of assigning these employees to departments as needed.

The North Portland Plant has an Extrusion Department that manufactures plastic-covered paper-products which are primarily used by the food industry.  Prior to the implementation of the current Agreement, all employees in the Extrusion Department were classified as operators, and staffing for extruder machines was done on a team model.  There are three (3) extruder machines in this department; the machine designated as Extruder #3 is the largest and most complex machine and is the only machine that requires three (3) employees to operate it.

During negotiations for the current Agreement, which commenced in mid-October 2001 and were concluded in March, 2002, the Company raised concerns about the necessity for cost-saving measures in the Extrusion Department.  Consequent to Company proposals for changes to the job classification and staffing procedures in the Extrusion Department, a job classification of helper was reinstated and added to that Department in the 2002-2006 Agreement.  This classification incorporates three levels:  employees who were employed in the Extrusion Department prior to March 11, 2002; employees who were employed elsewhere in the Plant prior to March 11, 2002 and subsequently transferred to the Extrusion Department; and employees who began employment at the Plant subsequent to March 11, 2002.  Testimony by Union negotiators and management at the arbitration hearing indicated that it was their understanding that Extruder #3 would be staffed by one (1) operator and two (2) helpers rather than the previous three (3) operator team.  Helpers are paid substantially less than operators.

On March 14, 2002, Joe Walczyk, Extrusion and Coating Department Manager, sent a memorandum to Extrusion Department Associates wherein he indicated a sign-up sheet had been posted so each employee could indicate whether he/she wished to be scheduled as an operator or a helper, with the goal of beginning scheduling using those two categories as of March 25.[2]

On March 20, 2002, Joe Walczyk and Alan Kirkwood, Chairman of the Union Standing Committee and an extruder operator, sent another memo to Associates indicating they would entertain further questions from employees and outlining a process for doing so, with the understanding that the sign-up roster would be re-posted the week of April 8 and employees would be expected to make their final choices (between being scheduled as an operator and a helper) prior to 8:00 a.m. on April 18, 2002.[3]

Mr. Kirkwood and Mr. Walczyk sent a further memo to the Associates on March 28, 2002 titled “Extrusion Operator/Helper Transition Information” which addressed classification preferences and shift preferences and outlined the guidelines that would be employed in scheduling once the new operator/helper positions were in place.[4]

On June 7, 2002 the Company and Union representatives met and discussed the implementation of the job classification change, namely the addition of the helper classification, for Extruder #3.  At this meeting the Company raised the issue of changing the composition of Extruder #3 staffing, informing the Union that it intended to staff that machine with one (1) operator, one (1) helper and one (1) Labor Pool employee, which latter employee would be responsible for the rewind and roll wrap work on that machine.  The Company maintained that it was within its rights in making this decision according to the terms of the Agreement.

At a second meeting between Company and Union representatives held on July 31, 2002 there was further discussion of the work assignment plan for Extruder #3.  At this meeting the Company reiterated its intention to use a Labor Pool employee to staff the third position on that machine, namely to rewind and roll wrap.

On August 2, 2002, Jeannie Schell, Union President; David Freudenthaler; and Alan Kirkwood, Chairman of the Union Standing Committee, signed a Letter of Understanding on behalf of the Union on the subject of Extrusion Labor Pool Staffing.  This letter was a result of discussions at the July 31 meeting, and can be summarized as an agreement by the Union not to challenge the Company’s right to schedule Labor Pool employees to work on the rewind end of Extruder #3, in consideration of which agreement the Union was granted four considerations.  The considerations were described as requests of disqualification/demotion in lieu of termination for four (4) Extrusion Department employees.  These considerations are colloquially known as “wild cards.”  The Letter of Understanding listed three (3) employees for whom the considerations would be applied and stipulated that the considerations were not applicable to employees who had committed what were characterized as “cardinal sins.”  The Letter also contained the following language:

b)  For a 1-year period, the Company will attempt to schedule two operators on #3 Extruder.  The Company reserves its usual and customary rights including, but not limited to:

-determining the Lead Operator in charge of #3 Extruder

-scheduling a Helper in lieu of an operator if there’s a shortage of qualified Operators who have designated “Operator” status

-not working operators OT if a Helper is available

-scheduling a Helper in lieu of an Operator for training purposes on #3 Extruder[5]

On August 7, 2002, Mr. Walczyk sent a memo to Extrusion personnel indicating that beginning August 12, Extruder #3 would be staffed by two (2) Extrusion Department staff and one (1) Labor Pool employee, with the provision that whenever possible the two (2) Department staff would both be operators.  The memo also noted that the operator/helper selection list would be reopened and would remain open until August 28 so employees could change their previous choices.[6]

On or about August 12, 2002 the Company began using Labor Pool employees to staff the third position on Extruder #3.

On August 26, 2002, Local 78 President Jeannie Schell sent a letter to Senior Regional Human Resources Manager George Karambelas and Director of Operations Michael Stratton terminating the August 2, 2002 Letter of Understanding effective August 24, 2002.[7]  She did so subsequent to a conversation with Kenneth Hardwick, Area Rep for the Association of Western Pulp and Paper Workers for Oregon, Idaho and Utah, and acting on his advice.  On the same day she sent a memo to the Local 78 members informing them that the Letter of Agreement was terminated.[8]

On August 27, 2002, Mr. Karambelas sent a letter to Ms. Schell indicating the Company would not accept her withdrawal of the Letter of Agreement and offering to meet with her the following week to discuss her concerns.[9]

On September 9, 2002, Lenard Roberts, President of the Association of Western Pulp and Paper Workers, sent a letter to Mr. Karambelas informing him of the Union’s position that the Standing Committee did not have the authority to sign the Letter of Understanding because the Committee’s authority did not extend to any additional agreement that would change the negotiated and ratified Agreement proper.[10]

On September 10, 2002, Mr. Kirkwood filed a First Step Grievance, No. 16-02, on behalf of the Union.  The Grievance was stated to be “Changed Bargained Job to Labor Pool” and the Existing Agreement Violated was listed as “2003 Bargain - Section 1-10.12 - 10.13 - - 10.14 - 10.2 - 10.3 - 10.”  The Desired Settlement was noted to be “Return job to dept.  Not labor pool.  Make employees whole.”[11]

On September 13, 2002, Mr. Walczyk responded to the First Step Grievance.  His response as department head was as follows:

The position in question only requires labor pool skills and responsibilities.  Staffing is consistent with Section 3 of the Labor Agreement.  The contract has not been violated.  Grievance is untimely.[12]

On October 7, 2002, in response to Joe Walczyk’s denial of the First Step Grievance, Alan Kirkwood filed a Step 2 Grievance.[13]

The Company denied the Second Step Grievance on October 9, 2002, which response was received by the Union on October 14.  The Company response stated:

The filing of this grievance violates the agreement reached on August 2, 2002.  Additionally, the Company considers the Union’s actions as bad faith bargaining.  This Grievance is also untimely.[14]

On October 23, 2002, Alan Kirkwood filed a Third Step Grievance and requested that George Karambelas and Michael Stratton contact him to set up meeting times for the Committee.[15]  On November 22, 2002, Mr. Stratton forwarded a copy of a letter from Alan Kirkwood listing outstanding 3rd Step Grievances to Mr. Karambelas with a note indicating they needed to get together to discuss Grievance 06-02 and schedule a Committee meeting time.[16]

On February 3, 2003, Mr. Karambelas wrote to Mr. Hardwick regarding several grievances.  With respect to Grievance 06-02, he stated the Company position that it was not arbitrable and indicated that if the Union believed it to be arbitrable it should retain an arbitrator to make that determination.[17]

David Gaba was chosen as Arbitrator and an arbitration hearing was held before Arbitrator Gaba on May 13, 2004 at Portland, Oregon.


The Union in its brief characterizes the grievance as a “relatively simple contract interpretation case… complicated by a now voided side agreement.”[18]  The Union argues that the grievance was filed in a timely manner because this is a continuing violation with a new contract violation occurring daily, i.e., whenever an employee in the rewind position on Extruder #3 is paid Labor Pool wages.  The Union further states that the filing should be considered timely even if its argument with reference to continuing violation is denied, noting that on August 26, 2002 the Local withdrew from the Letter of Understanding, or “wild card” agreement and at the Company’s request agreed to meet with Company representatives on September 9.  On September 9 the Association President sent another letter affirming that the Letter of Understanding was void.  The Union notes that the First Step Grievance was filed the next day and contends that it was thus timely.  The Union points out that there is no explicit time requirement in the contract language for moving from a step one to a step two grievance once the former has been denied, but notes that the Union had the discretion to perform a timely investigation to determine whether to move to step two, and that the Union filed a Step Two Grievance on October 7, 2002.  The Union contends that, because its representative did not receive the Company’s October 9 denial of its Step Two Grievance until October 14, the October 23 submission of the Step Three Grievance was within the ten (10) day limit.  The Union also points out that the Union was within the forty-five (45) day limit in its request for arbitration, as the Third Step Grievance was denied on January 7, 2003 and the Union requested arbitration on February 2.

It is the Union’s position that the Company violated the Agreement when it failed to maintain the rewind position on Extruder #3 at helper pay rates, and that the Company has essentially lowered the wages for that position even though the job responsibilities have not been changed.  The Union considers the very fact that the Company proposed the Letter of Agreement to eliminate the possibility of a grievance being filed on this issue as evidence that the Company knew its behavior was a contract violation and was attempting to ensure that that violation would not be contested.

The Union points out that no Labor Pool employees had ever worked on extruder machines prior to the Company assigning them to Extruder #3, with the exception of one (1) employee who was at one point assigned to bag and load rolls for an old machine that made wax paper.  It is the Union’s position that the understanding derived from the negotiations leading to the current Agreement was clearly that the #3 Extruder would be staffed by one (1) operator and two (2) helpers rather than the three (3) operators who had previously done so.  The Union also indicates that, while the helper classification was in a sense new to the current Agreement, in that it had not been in place in the previous one, it was actually a reinstatement of a job classification that had previously existed in the Extrusion Department, prior to the adoption of the team model.

The Union notes that the June 7, 2002 meeting was the first time the Company mentioned the possibility of assigning a Labor Pool employee to the third position on Extruder #3, but that it was not until the meeting on July 30 that it indicated its definite intention to do so in proposing the Letter of Understanding that precluded grievance of such a change.  While the change was implemented on or around August 12, the Union notes that it was not until several weeks later that the Local was made aware that the Union did not consider that the Local representatives had had the authority to sign the disputed Letter of Understanding.

Addressing the Company’s refusal to cease using Labor Pool employees on Extruder #3, the Union reiterates that the Company had clearly sought to buy off the Local with “wild cards” for unrelated disciplinary matters to preclude a Union challenge on the issue of Extruder #3 staffing.  It is the Union’s position that the Local was within its rights in withdrawing from the Letter of Agreement at any time, in that it contained no specified term and no termination consequences.  The Union is emphatic in its belief that the Company knew its staffing changes for Extruder #3 were in violation of the recently ratified Agreement, in that the Company had never, during negotiations, raised the possibility of having that Extruder staffed by one (1) operator, one (1) helper and one (1) Labor Pool employee, nor did it try to argue that it had done so.

The Union contends that the level of skill for the Extruder #3 rewind position is significantly greater than that required by any other Labor Pool assignment, and that the work being done by these individuals in fact falls under the classification of helper work.  The Union cites hearing testimony by both management and Union employees in reiterating its conclusion that Labor Pool employees are clearly being used to do work that should clearly be assigned to helpers only.


The Company in its brief begins by challenging the timeliness of the Union’s grievance and contends that the Union specifically waived any right to grieve the change to the Extruder #3 staffing procedure when Local representatives on the Union Standing Committee signed the Letter of Understanding to that effect on August 2, 2002.[19]

The Company’s presentation of the issues is threefold, encompassing untimely filing of the grievance, the valid and binding nature of the afore-mentioned Letter of Understanding, and the Company’s right under Section 3 of the current Agreement to assign a Labor Pool employee to Extruder #3.  The Company argues that only if the Arbitrator finds that the grievance was filed timely and that the Letter of Understanding could be waived can he address the third question of management prerogatives as to work assignments.  The Company states that the Letter of Understanding contained no language that added or subtracted from the Agreement proper and, given that conclusion, insists that the Union had no right to grieve the Extruder #3 staffing issue any further, making the grievance untimely.

Addressing further the issue of timeliness, the Company turns to the Agreement to bolster its case that the Union did not grieve the instant issue in a timely manner.  It is the Company’s position that the Union became aware of the issue of this grievance at the June 7, 2002 meeting, when the Company first raised the question of staffing Extruder #3 with an operator, helper and Labor Pool employee.  Even if that discussion and the subsequent discussion on July 30 are construed as the informal stage of the grievance procedure, the Company reiterates that the Union waived its right to grieve when it entered into the Letter of Understanding on August 2, 2002.

Taking its argument further, the Company concludes that even if the Letter of Understanding is found not to be valid and binding on both parties, the Union was definitely aware of the issue that is the subject of grievance on August 2, August 7, August 8, August 12 and August 26 and could have chosen to file a grievance on any of those dates rather than waiting until September 10.  The Company cites Cincinnati Box & Partition, 86 LA 1122 (Sincropi 1986) wherein a similar situation occurred with reference to a grievance being “untimely in relation to any and all of the events which could have been considered the ‘occurrence’.”  The Company goes on to cite other cases that bolster its contention that the untimely filing precludes any further examination of the merits of the Union’s argument.  The Company also disputes the Union’s argument with reference to a continuing violation of the Agreement, contending that it is not a logical argument.  The Company again notes that the Union was untimely in its filing regardless of which date is determined to be the first occurrence of the purported violation of the Agreement, and notes that the Agreement language with reference to timeliness has been consistently applied in past disputes.

The Company cites Elkouri and Elkouri to clarify that, while the Company maintained all along that the grievance was not timely, it was appropriate that it also continue to discuss the grievance on its merits so as to be prepared for presentation to an arbitrator, if necessary.[20]

Turning again to the Letter of Understanding, the Company reiterates its position that that Letter is a valid and binding agreement that the Local Union Standing Committee had authority to accept.  The Company takes exception to the Union argument that the Letter was an attempt to substantively change the Agreement, citing its good faith and reasonable assumption that conditions of the Letter would prevail and the fact that the Union benefited from the terms of the Letter.  The Company cites past practice with reference to the Union Standing Committee having withdrawn grievances in the past on its own discretion, and in this instance was essentially withdrawing a grievance, albeit before the fact of filing.  The Company’s interpretation of Section 1 of the Agreement is that the Local has authority to act as a party to the Agreement.

The Company asserts that the terms of the Agreement, specifically Section 3, give Company management the right to make decisions as to work schedules and employee assignments, provided such decisions are consistent with the other terms of the Agreement.  It is noted that the Agreement clearly provides that Labor Pool employees are permitted to work in any department in the Plant.

With reference to Sections 1 and 10 of the Agreement, the Company maintains that nowhere does the language of either section support the Union’s contention that the Agreement prohibits the Company from assigning a Labor Pool employee to work on Extruder #3 in lieu of one of the helpers.  The Company emphasizes that there is no specific restriction against such an assignment in the Agreement, and cites several decisions that hinged on the reasonableness of a change of assignment in order to bolster its argument.  The Company argues out that it has not attempted to create a new job classification nor has it made significant changes to the job content of existing classifications.

The Company notes that the Labor Pool Classification, designated as “open” in the recent Agreement, has always performed roll wrap functions across the Plant, and cites Section 6.2 which places bundlers and roll wrappers in the Labor Pool rather than in departments for the purpose of determining seniority.  Absent specific language to the contrary, the Company reiterates that the management rights clause of the Agreement allows it broad discretion in making work assignments for the benefit of the organization.  Several cases are cited wherein jobs were eliminated, past practice was changed, duties were reassigned, and work groups lost work volume, yet arbitrators upheld the employers’ rights to reallocate and reassign work based on contract provisions allowing them to do so.

The Company concludes its arguments by asking that the grievance be dismissed as untimely.  Should it be revisited, the Company asks that the Letter of Understanding be found valid and binding,  Finally, the Company asserts that it is within its managerial rights in its assignment of Labor Pool employees to work on rewind and roll wrap on Extruder #3.


Turning first to the question of whether the Union filing of the grievance was timely under the terms of Section 17 of the Agreement, I concur with the Union and find the matter at issue is indeed in the nature of a “continuing grievance,” i.e., each time the Company uses a Labor Pool employee rather than a helper to staff the third position on Extruder #3, there is a new violation.  An extensive body of arbitral opinion regarding asserted continuing violations exists, and I am in accord with the prevailing view as described by Elkouri and Elkouri:

Many arbitrators have held that “continuing” violations of the agreement (as opposed to a single isolated and completed transaction) give rise to “continuing grievances in the sense that the act complained of may be said to be repeated from day to day --- each day there is a new “occurrence” these arbitrators have permitted the filing of such grievances at any time, this being deemed a violation of the specific limits stated in the agreement (although any back pay ordinarily runs only from the date of filing).[21]

There is no question that the Union has raised a valid question as to the interpretation of the Agreement with respect to the question of whether the Company was within its rights in making changes to the staffing of Extruder #3.  Certainly the Agreement overall does contain some degree of ambiguity.  The Company references the management prerogative language of Section 3 in defending its actions, but testimony at hearing elicited the fact that both parties had a clear understanding, when the Extrusion Department staffing issues were bargained during negotiations, that staffing for Extruder #3 would be changed from three (3) operators to one (1) operator and (2) helpers.  For the Company to continue to maintain otherwise could raise questions of bad faith bargaining during negotiations; when the Company staffed with (1) operator and (2) helpers it was quite simply getting what it bargained for.  Clearly if the Letter of Understanding did not exist this would be a simple case of contract interpretation and the Union would prevail.

The Letter of Understanding

This case clearly turns on whether the  “Letter of Understanding” entered into between Local 78 and the Company binds the Union.  In order to prevail the Union must simply prove that it is correct in its argument that Local 78 had no authority to enter into the Letter of Understanding.  The standard of proof for contractual disputes is preponderance of the evidence.  Preponderance of the evidence can be defined as:

the standard of proof in most civil cases in which the party bearing the burden of proof must present evidence which is more credible and convincing than that presented by the other party or which shows that the fact to be proven is more probable than not.[22]

The applicable standards for contract interpretation are well established.  Where the language in a collective bargaining agreement is clear and unambiguous, the arbitrator must give effect to the plain meaning of the language.  This is so even when one party finds the result unexpected or harsh.  Words are to be given their ordinary and popularly accepted meaning, unless other evidence indicates that the parties intended some specialized meaning.[23] 

As stated by Elkouri and Elkouri:

Arbitrators have often ruled that in the absence of a showing of mutual understanding of the parties to the contrary, the usual and ordinary definition of terms as defined by a reliable dictionary should govern.  The use of dictionary definitions in arbital opinions provides a neutral interpretation of a word or phrase that carries the air of authority.[24]

The Union maintains that Local 78 had no authority to sign the Letter of Understanding and correctly surmises that it was an amendment to the existing Agreement.  I concur with the Union in its contention that the Letter of Understanding does amend the Agreement.  The Company’s position is that the Letter does not substantively amend the contract, yet the Company was willing to grant the Local four “wild cards”[25] in order to obtain it.  By seeking agreement not to grieve the Company’s staffing change in the Extrusion Department, the Employer was tacitly acknowledging that such change was an amendment to the parties Agreement.

Can the Local Amend the Contract?

At first blush this appears to be a simple case; one of the prime tenets of the NLRA is that management is precluded from dealing directly with employees or individual groups of employees.  Absent contract language authorizing the “direct dealing” management would commit an Unfair Labor Practice (ULP) with every attempted individual negotiation.  The Employer’s position at the hearing that previous agreements entered into between the Company and the Local constitute a “past practice,” can be easily disregarded; the parties’ history would only show a pattern of illegal activity absent contract language allowing the direct dealing. 

The difficulty I am faced with is that the language of the Agreement title (and of Section 1, “Purpose,”) clearly states that the Agreement is between the Company and the Union “acting through its North Portland Local Union No. 78.”[26]  I have never before encountered a contractual reference to this effect.  Does the language clearly provide for Local 78 to have authority within the confines of the contract over and above that usually accorded to bargaining units by unions?[27]  Absent that language, the Union’s case that the Union Standing Committee had no authority to enter into the Letter of Understanding would be upheld.  If the afore-mentioned language governs, it is then axiomatic that when Section 2 uses language referring to the Union as “the sole collective bargaining agent for the employees covered herein as to wages, hours and working conditions,” the definition of Local 78 as the agent of that Union would have already been established.

It is the goal of the arbitrator to interpret the language in the manner the parties intended. “Arbitrators must strive to determine what the parties were attempting to accomplish by the contract language used and to effectuate that intent.”[28]  Unfortunately, as noted above, there is no showing that the parties ever had a common understanding of what the language meant and the parties bargaining history has apparently vanished into the mists of time (there being no testimony of those involved with bargaining the language in question).

Since it is impossible to determine the parties intent, one must look at the other rules of contract construction.  It has long been held that  “It is axiomatic in contract construction that an interpretation which tends to nullify or render meaningless any part of the contract should be avoided because of the general presumption that the parties do not carefully write into a solemnly negotiated agreement words intended to have no effect.”[29]  “The fact that a word is used indicates that the parties intended it to have meaning, and it will not be declared surplusage if a reasonable meaning can be given to it consistent with the rest of the agreement.”[30]

 In line with this principle, another rule of contract interpretation is “that the expression of one or more subjects excludes all others.”[31]  This legal doctrine is otherwise known as “inclusion unius est exclusion alterious, i.e., the inclusion of one is the exclusion of others.”[32]  The parties at one time chose to use the language:

THIS AGREEMENT, made and entered into this 11th day of March, 2002 by and between North Portland Plant of Graphic Packaging Corporation, which is hereinafter called “Company,” and THE ASSOCIATION OF WESTERN PULP & PAPER WORKERS, hereinafter called “Union”, acting through its North Portland Local Union No. 78.[33] 

Clearly the parties meant “through its North Portland Local Union No. 78,” to mean something.  One possible meaning is that Local Union No. 78 was the contracting party.  This argument is bolstered by the signature page of the Collective Bargaining Agreement which lists signatures for the “ASSOCIATION OF WESTERN PULP AND PAPER WORKERS LOCAL 78.”  Clearly an argument can be made that Local 78 was the contracting party and had the authority to amend the contract.  While this argument may be flimsy, it is persuasive enough that the Union cannot show another meaning of the language by a preponderance of the evidence.  In a truly close case such as this one cannot say that a preponderance of the evidence supports management’s position, however, I can say that the Union has failed to meet  its burden of proof.


The burden is on the Union to establish by a preponderance of the evidence that: the grievance was timely filed, and that the Company violated the parties’ Collective Bargaining Agreement when it failed to acquiesce to the Union’s request for termination of the “Letter of Understanding.”

           The Union has established that there has been a continuing violation of the initial terms of the Agreement that commenced when the Company began to employ a Labor Pool employee on Extruder #3.  However, the Union has failed to demonstrate by a preponderance of the evidence that the Letter of Understanding is not binding. The Letter amends the parties contract.  The grievance is denied.


            The grievance is denied.  The Union must accept the terms of the Letter of Agreement and the Company may continue to use Labor Pool employees to staff the third position on Extruder #3.

All fees and expenses charged by the Arbitrator shall be shared equally by the Union and the Company, as provided for in Section 17, “Handling of Complaints and Arbitration,” of the Collective Bargaining Agreement,

                                                                        David Gaba, Arbitrator
                                                                        August 14, 2004
                                                                        Seattle, Washington

[1] Exhibit J-1

[2] Exhibit E-14.

[3] Exhibit E-15.

[4] Exhibit E-16.

[5] Exhibit U-1 (G-3, G-4).

[6] Exhibit E-3.

[7] Exhibit U-1 (G-5).

[8] Exhibit U-1 (G-6).

[9] Exhibit U-1 (G-7).

[10] Exhibit U-1 (G-8).

[11] Exhibit J-2.

[12] Exhibit J-2.

[13] Exhibit U-3.

[14] Exhibit U-4.

[15] Exhibit U-2.

[16] Exhibit E-4.

[17] Exhibit E-5.

[18] Union’s Post-Hearing Brief.

[19] Company Post Hearing Brief.

[20] Elkouri and Elkouri, How Arbitration Works, 278 (5th Ed. 1997).

[21] Elkouri and Elkouri, How Arbitration Works, 197 (Fourth Edition).

[22] Merriam-Webster’s Dictionary of Law, 1996.

[23] Seattle School District,  119 LA 481 (2004)

[24] Elkouri and Elkouri, How Arbitration Works, 490-91 (5th ed. 1997).

[25] A “wild card” being an agreement that management will forgo discipline for a yet to be committed infraction.

[26] AGREEMENT Between GRAPHIC PACKAGING CORPORATION, North Portland Plant, and THE ASSOCIATION OF WESTERN PULP AND PAPER WORKERS acting through its North Portland Local Union.

[27] It should be noted that the Union in this case uses the term “Local” to describe what most other Unions would refer to as a “bargaining unit.”

[28] City of Davenport, 91 LA 855 (Hoh, 1988).

[29] Armstrong Rubber Co., 87 LA 146 (Bankston, 1986). 

[30] Elkouri and Elkouri, supra, 493-94 (citing Beatrice Foods Co., 45 LA 540 (Stouffer, 1965).

[31] Columbia Local Sch. Dist., 100 LA 227 (Fullmer, 1992). 

[32] City of Ann Arbor, 102 LA 801, (Roumell Jr., 1994). 

[33] Emphasis added.

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