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Arbitration Law Memo September 2006
by Ross Runkel at LawMemo
Arbitration Law Memo September 2006
by LawMemo - World's Best
Also available by free monthly email.
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Arbitration - Individual Contracts ***
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Arbitration - Collective Bargaining Agreements ***
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10th - Arbitrator upheld on interpretation of conflicting discharge provisions.
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CA - Court finds no authority for the proposition that arbitrators can't interpret statutes.
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3rd - Grievances not arbitrable because CBA's arbitration clause was narrow.
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10th - Anti-strike injunction conditions violated RLA (2-1).
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CA - State employees' union failed to exhaust its arbitration remedy.
*** Arbitration - Individual Contracts ***
CA - Arbitrator's award wasn't reviewable for errors of law.
Baize v. Eastride Companies (California
Ct App 08/25/2006)
http://www.courtinfo.ca.gov/opinions/documents/B185823.PDF
Baize was discharged, but claimed that he was entitled to unpaid compensation pursuant to his employment agreement. He and the employer submitted the dispute to arbitration. Baize prevailed, but the employer sought to have the arbitration award vacated on the ground that the arbitrator failed to correctly apply California law. The trial court concluded that it lacked jurisdiction to review the award for errors of law. The court affirmed, stating "[a]n arbitrator's award is not reviewable for claimed errors of law."
2nd - Arbitration clause was effective, even though employment contract that contained it had expired.
George v. LeBeau (2nd Cir 09/08/2006)
http://caselaw.lp.findlaw.com/data2/circs/2nd/054241pv2.pdf
LeBeau's employment contract contained an arbitration clause. The contract expired prior to termination of LeBeau's employment, however, and LeBeau kept on working at her job for years without another written contract. The general rule under New York law is that when an employment contract expires and the employee continues to render the same services as he did prior to expiration of the contract, "it will be presumed that he is serving under a new contract having the same terms and conditions .... " In Waldron v. Goddess, 461 NE2d 273 (NY 1984), however, a state appellate court opined that "the threshold for clarity of agreement to arbitrate is greater than with respect to other contractual terms [,]" and that there must be a "clearly expressed intention to renew the arbitration agreement." That proposition conflicts with several state and federal cases, and at least one federal case has interpreted Waldron as limited to its facts. The court agreed that Waldron should be limited to its facts, and declined to apply it. The court thus determined that the arbitration clause in LeBeau's employment contract survived the contract's stated expiration date and that the parties were bound to arbitrate their dispute.
*** Arbitration - Collective Bargaining Agreements ***
10th - Arbitrator upheld on interpretation of conflicting discharge provisions.
LB&B
Associates v. IBEW (10th Cir 08/29/2006)
http://laws.findlaw.com/10th/051110.html
The employer appealed the trial court's refusal to vacate a grievance arbitration award rendered in favor of an employee and his union. The employee had been discharged for allegedly making sexually harassing comments to a female employee. The arbitrator concluded that the employee did engage in the conduct alleged, but ordered reinstatement after concluding that the employee's conduct did not constitute "good cause" for discharge. The 10th Circuit affirmed.
The parties' collective bargaining agreement (CBA) contained two provisions regarding discharge. One provision stated that the employer may discharge employees for "just cause." Another provision listed a number of offenses that were grounds for immediate discharge. The arbitrator concluded that an employee committing one of the enumerated offenses is vulnerable to discharge because of the serious nature of the offense, but that the ultimate discharge decision must be supported by "just cause" as required under the CBA. Different courts have treated such contradicting CBA provisions different ways.
In Warrior & Gulf Navigation Co. v. United Steelworkers of America, 996 F.2d 279 (11th Cir 1993), the 11th Circuit found that an arbitrator's similar interpretation of a CBA "contradicted the express language of the Agreement." However, both the 3rd Circuit (Arco-Polymers, Inc. v. Local 8-74, 671 F.2d 752 (3rd Cir 1982)) and the 6th Circuit (Bruce Hardwood Floors v. S. Council of Indus. Workers, 8 F.3d 1104 (6th Cir 1993)) have deferred to arbitrators' interpretations of similar contract provisions. The court adopted the approach taken by the 3rd and 6th Circuits, concluding that "[w]hen an agreement includes a 'just cause' termination provision and does not explicitly provide that an enumerated offense is such cause, the 'profound deference' owed to an arbitrator's decision, coupled with the fact that the parties have bargained for the arbitrator, not the courts, to decide their dispute, compels affirmance of an arbitrator's interpretation requiring both the enumerated offense and circumstances amounting to just cause in order to justify termination."
CA - Court finds no authority for the proposition that arbitrators can't interpret statutes.
California
Correctional Peace Officers Assn v. State (California Ct App 08/23/2006)
http://caselaw.lp.findlaw.com/data2/californiastatecases/a112311.pdf
The union (representing correctional officers) petitioned to compel arbitration. The public employer opposed the petition on the ground that the relief sought by the union would violate California Government Code Section 3529 (which states that supervisory employees "shall not participate in meet and confer sessions on behalf of" non-supervisory employees). The trial court accepted the employer's argument and denied the union's petition. The court reversed and remanded for arbitration.
The court framed the primary issue on appeal as "whether a party opposing a petition to compel arbitration may defeat the petition by demonstrating that the relief sought by the petitioner in arbitration is precluded by statute." The employer argued that only courts (and not arbitrators) are permitted to interpret statutes. The court rejected that argument, finding "no authority" in support of it.
6th - NLRB didn't have exclusive jurisdiction over dispute.
Intl Brotherhood of Elec Workers v.
Trafftech (6th Cir 08/23/2006)
http://caselaw.lp.findlaw.com/data2/circs/6th/054392p.pdf
The union sued the employer, seeking enforcement of a grievance arbitration clause in the parties' collective bargaining agreement (CBA). The trial court granted summary judgment in favor of the union. The 6th Circuit affirmed. The underlying dispute arose from the fact that the employer entered into collective bargaining agreements with two different unions - promising each of them the same work on an exclusive basis. The employer argued that this was thus a representational matter outside the jurisdiction of the federal courts. The court noted that "[t]he fact that [the employer] may have entered into another collective bargaining agreement regarding some of the same work does not necessarily make the dispute a representational one committed exclusively to the National Labor Relations Board (NLRB)."
3rd - Grievances not arbitrable because CBA's arbitration clause was narrow.
Local 827 v. Verizon (3rd Cir
08/17/2006)
http://caselaw.lp.findlaw.com/data2/circs/3rd/053613p.pdf
The union sued the employer, seeking to compel arbitration of three grievances. The trial court granted summary judgment in favor of the union, based on its conclusion that the arbitration clause contained in the parties' collective bargaining agreement was broad. The 3rd Circuit reversed, concluding that the arbitration clause was narrow and that the issues underlying the grievances were not within its scope. The court noted that another federal district court has concluded that the very same arbitration clause is narrow (Local 827, Int'l Bhd. of Elec. Workers v. Verizon N.J., Inc., Civ. No. 03-3612 (D.N.J. filed June 25, 2005)).
10th - Anti-strike injunction conditions violated RLA (2-1).
Brotherhood of Maintenance of Way
Employees Division/IBT v. Union Pacific Railroad Co (10th Cir 08/11/2006)
http://laws.findlaw.com/10th/051511.html
The union sued the employer for violation of the Railway Labor Act (RLA). The trial court granted the employer's motion to dismiss the action as a "minor dispute" and the motion for an anti-strike injunction. The trial court conditioned the anti-strike injunction upon the parties submitting their dispute to a previously-formed arbitration panel. The 10th Circuit reversed the anti-strike injunction conditions. The court found that by conditioning its grant of the anti-strike injunction on the parties submitting their dispute to the arbitration panel, the trial court effectively ignored the provisions of the RLA and deprived the employer of its statutory right to have either the National Railroad Adjustment Board (NRAB) or a newly-formed-board decide the dispute. The DISSENT argued that the mere presence of a statutory scheme was not sufficient to strip the equitable powers of the trial courts.
CA - State employees' union failed to exhaust its arbitration remedy.
Service Employees Intl Union v. Dept of
Personnel Admin (California Ct App 09/01/2006)
http://caselaw.lp.findlaw.com/data2/californiastatecases/c049936.pdf
The union sued the state employer, challenging the employer's refusal to permit worksite distribution of materials supporting a ballot proposition. The trial court dismissed, concluding that the union was required to arbitrate the question of whether the materials were of a "partisan political nature" under the parties' collective bargaining agreement. The court affirmed, stating "[w]e agree with the trial court that the union's failure to exhaust its arbitration remedy bars its premature civil action."
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Editor: Ross Runkel, Professor of Law Emeritus. email Ross@LawMemo.Com, Phone 503-399-8028. Copyright LawMemo, Inc.
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