Sunday, March 1, 2015

Adrian Peterson, arbitration and the law of the shop

The decision of Judge David Doty in the NFLPA's challenge to the award in the Adrian Peterson case has been the subject of considerable press. Despite earlier predictions about the difficulty of overturning arbitration awards, Judge Doty has vacated the award on two distinct grounds. NFL Players Association v. NFL and NFL Management Council

Peterson had been suspended for his actions relating to what he claimed was the discipline of his child. The suspension was imposed pursuant the Commissioner's authority under the cba to discipline a player for "conduct detrimental to the integrity of, or public confidence in, the game."  Under the Standard Player Contract the Commissioner, upon a finding of such conduct, has " the right, but only after giving Player the opportunity for a hearing ... to fine Player in a reasonable amount; to suspend Player for a period certain or indefinitely; and/or to terminate this contract."

 After a dispute about the scheduling and scope of a hearing, and without hearing directly from Peterson, the Commissioner suspended him for the remainder of the season, fined him six weeks pay, inclusive of amounts forfeited during the suspension, and ordered him to participate in a counselling and treatment program.

Under the process contained in the cba, the NFLPA appealed the discipline to a hearing officer appointed by the Commissioner. The Union claimed that the Commissioner had improperly, and retroactively, imposed discipline on Peterson pursuant to a new policy issued after the adverse publicity concerning the discipline of Ray Rice. The Union maintained that under the policy in existence at the time of the incident in issue, the presumptive penalty was a two game suspension. The Union also claimed that Peterson had been deprived of a fair hearing, that the imposition of psychiatric counseling was not permissible under the cba, and that the Exempt List had improperly been used as a form of discipline. In support of its claim the Union relied, in part, on the decision of Judge Barbara Jones (here) in connection with the appeal of the discipline imposed on Ray Rice. The Union asserted that the Rice decision established that the new policy could not be applied retroactively and that this decision had become "the law of the shop."

After a hearing, the Hearing Officer rejected each of the Union's arguments. (The decision of Hearing Officer Harold Henderson can be found here). He concluded that the Commissioner had broad discretion to impose discipline under the cba and found the new policy consistent with the prior one. He acknowledged that the discipline imposed was greater than that imposed in previous cases under the prior policy but found that it involved "one of the most egregious cases of domestic violence in this Commissioner's tenure." He also rejected the claims that Peterson had been improperly denied a hearing and that the Commissioner had no authority to require counseling. Accordingly he denied the grievance and affirmed the discipline.

The NFLPA filed suit to vacate the award. The NFLPA's complaint can be found here. It maintained that the award violated "the essence of the cba," that Henderson exceeded his authority by deciding whether the discipline was permissible under the old policy, that the award was fundamentally unfair given the retroactive application of the new policy and that Henderson was an evidently partial arbitrator.

While recognizing the substantial deference ordinarily given by courts to arbitrator's awards, Judge Doty noted that "Arbitration awards ... are not inviolate, and the court need not merely rubber stamp the arbitrator's interpretations and decisions." He explained:

Although the court may not vacate an award if the arbitrator was “arguably construing or applying the CBA,” vacatur is proper when the award “fails to draw its essence from the CBA or is contrary to the plain language of the [CBA].” Bureau of Engraving, Inc. v. Graphic Commc’ns Int’l Union, Local 1B, 164 F.3d 427, 429 (8th Cir. 1999). “The essence of the CBA is derived not only from its express provisions, but also from the industrial common law.” Id. The industrial common law includes “past practices of the industry and the shop,” i.e., the law of the shop, and “the parties’ negotiating history and other extrinsic evidence of intent.” Id.; see also United Steelworkers of Am. v. Warrior & Gulf Navigation Co., 363 U.S. 574, 581-82 (1960) (“The labor arbitrator’s source of law is not confined to the express provisions of the contract, as the industrial common law - the practices of the industry and the shop - is equally a part of the collective bargaining agreement although not expressed in it.”) The law of the shop necessarily includes prior arbitration awards. See Warrior & Gulf, 363 U.S. at 581 (“The processing of disputes through the grievance machinery is actually a vehicle by which meaning and content are given to the collective bargaining agreement.”).

 Judge Doty agreed with the NFLPA that, in this case, Henderson's award failed to draw its essence from the cba. He found that "in the Rice decision, the hearing officer unequivocally recognized that the New Policy cannot be applied retroactively." He rejected Henderson's efforts to distinguish the Rice decision as one involving double punishment and observed that Henderson had not explained why the "well recognized bar against retroactivity" did not apply to Peterson. The Judge concluded:

Even leaving the Rice decision aside, it is not seriously contested that the Commissioner understood he was constrained to apply the New Policy prospectively.... United Transp. Union, Local Lodge No. 31, 434 F2d 220, 222 (8th Cir. 1970) (recognizing that the law of the shop includes the understanding of the parties). Henderson simply disregarded the law of the shop and in doing so failed to meet his duty under the CBA. As a result, the arbitration award fails to draw its essence from the CBA and vacatur is warranted. See Trailways Lines, Inc. v. Trailways, Inc. Joint Council, 807 F.2d 1416, 1423 (8th Cir. 1986) (finding that failure to consider the law of the shop can be the sole basis to vacate an arbitration award).

The Judge also concluded that Henderson exceeded his authority by adjudicating the "hypothetical question" of whether Peterson's discipline could be sustained under the earlier policy. He determined that the NFLPA had not submitted that issue to the hearing officer, but only "the pure legal issue" of whether the New Police could be applied retroactively." Finding that Henderson had "strayed" beyond the issues submitted by the NFLPA the Judge concluded that vacatur was warranted on that basis as well.

In light of these two conclusions, Judge Doty found it unnecessary to decide whether Henderson was evidently partial or whether the award violated fundamental fairness. He granted the petition to vacate the award and remanded the case "for such further proceedings consistent with this order as the CBA may permit."

The NFL has issued a statement, here, expressing its disagreement with the decision and its intent to appeal.

Sunday, February 22, 2015

Reinstatement of teacher who required autistic student to wear sign not contrary to public policy

So held the Commonwealth Court of Pennsylvania in Colonial Intermediate Unit 20 v. Colonial Intermediate Unit 20 Education Association.

The dispute arose from the dismissal of a life skills special education teacher. Several days after a group of students went on a field trip to a petting zoo, the teacher was informed that one of his students, an autistic student with special needs, had repeatedly lured a goat with food and then hit it on the nose.  In an effort to impress upon the student the inappropriateness of his behavior, the teacher hung a sign around the student's neck which read "I abuse animals." The teacher texted a photo of the student with the sign to an associate teacher who had brought the incident to his attention. The student became upset, and the associate teacher and another staff member calmed him and altered the sign to read "I love animals." When the student was returned to the teacher's classroom he created a second sign reading "I abuse animals" and hung it on the student's back. The incident was reported to the school's principal and an investigation was conducted. The teacher was ultimately dismissed for this incident as well as other incidents occurring during previous years. The teachers union filed a grievance and arbitrated the dismissal.

Arbitrator Rochelle Kaplan sustained the grievance in part, converting the dismissal into a 53 day suspension, and conditioning grievant's reinstatement on participation in an improvement plan created by the Employer. The Arbitrator concluded:

The evidence showed that placing the sign on [Student] was not a proper educational technique to use, however, this incident is not the same as a teacher using drugs, accessing porn on a school website or sexually or physically abusing students. There was no evidence to suggest that placing a sign on [Student] violated a morality norm in an educational setting or that it offended the morals of the community.
* * *
[Employer] believes in `positive behavior supports' and prohibits `aversive techniques.' The Grievant was aware of the principle of `positive behavior supports.' However, what those concepts mean in practical terms and implementation appear to be subjective. Thus, in order for Grievant to have willfully violated these policies, there had to be some showing that the Grievant was trained on the principles and was aware that the techniques he was using were in clear derogation of the directives. Thus, [Employer] failed to prove that the Grievant willfully violated the school's directives.
* * * 
The Arbitrator concludes that the Grievant's conduct did not constitute immorality, cruelty, persistent negligence, willful violation of [Employer's] directive, or willful neglect of duties. Thus the dismissal on those grounds cannot stand.

The Arbitrator also concluded that the School District had not established that grievant had used excessive force when dealing with students. 

The School District sought to set aside the award as in excess of the Arbitrator's authority and in violation of public policy. The trial court rejected this effort, and the Commonwealth Court has now affirmed. 

The Court found the Arbitrator's decision was rationally derived from the cba and was within the authority of the Arbitrator. Turning to the public policy issue, the Court determined: 

...under the circumstances presented to Arbitrator, we discern no error in a determination that any public policy regarding aversive techniques was not so well-defined and ascertainable by reference to the laws and legal precedents as to qualify for the narrow exception to the essence test.
In light of the conditions imposed by Arbitrator, which address Employer's concerns in this case, Arbitrator's award does not pose an unacceptable risk to any well-defined or dominant school law or policy.... Accordingly, we reject Employer's contention that the trial court erred in failing to determine Arbitrator's award violates the public policy exception.

Sunday, February 15, 2015

NLRB General Counsel issues Guideline Memo on deferral to arbitration

In its decision in Babcock & Wilcox Construction Co. the NLRB revisited the issue of deferral of unfair labor practice charges to arbitration. In that case it announced a new policy, setting forth standards for when deferral would be appropriate.

In Memorandum GC 15-02 General Counsel Richard Griffin has issued guidelines to the Board's Regional Offices on handling this issue.

The memo summarizes the standards to be followed in deciding whether deferral is appropriate in cases alleging violation of Sections 8(a)1 or (3) of the Act (typically interference or discrimination because of an employee's union or other protected concerted activity).The GC notes that under the new test the applicable cba must explicitly authorize the arbitrator to decide the statutory issue before deferral is appropriate. This authorization can take the form of either language in the cba or through the parties' separate agreement. Given that arbitration is a consensual process, the GC notes that under the Babcock decision:

... a party will retain the option of adjudicating a statutory claim before the Board in the event the arbitrator denies the grievance where the collective-bargaining agreement is silent as to the statutory right and the party refused to authorize arbitration of the claim in the particular case. 

The memo also notes that the Babcock standard now requires that the arbitrator have been presented with and must have "actually considered" the statutory issue to warrant deferral. This is contrary to the previous test which required only that the arbitrator "in some fashion" have considered the facts relevant to both the statutory and contractual claim. Under the new test:

In order to show that the arbitrator actually considered the statutory issue, the Board will require that the arbitrator “identified that issue and at least generally explained why . . . the facts presented either do or do not support the unfair labor practice allegation.”

Upholding a dismissal under a just cause analysis will not, standing alone, be a basis for deferral.

Finally, the arbitrator's award must be "reasonably permitted" under Board law. This is in contrast to the previous test of whether the award was "clearly repugnant" to the Act or was "palpably wrong." While the arbitrator need not rule exactly as the Board might, the award must reach a result a "decision maker reasonably applying the Act could reach."

The memo also addresses the issue of deferral to grievance settlement agreements and notes the timeline for implementing the new standards. 

Sunday, February 8, 2015

3M succesfully terminated a past practice but contract language supported grievance

The Steelworkers union represents a unit of production employees at 3M's Cottage Grove, MN facility. The facility is fueled by natural gas and, on January 5th, 2014, 3M was notified by the utility company that because of the severe cold it was curtailing their use of gas. As a result, certain gas-dependent production lines were shut down and, because of the resulting loss of work, the affected employees were temporarily laid off. This gas curtailment continued until the afternoon of January 7th. This was the first time in at least ten years that the gas supply to the facility had been curtailed. Because of continued cold weather gas supply was again curtailed from January 25th through January 29th. Once again, certain employees were temporarily laid off as a result of loss of work caused by the curtailment. The Steelworkers filed grievances claiming in both instances that 3M had breached its cba by laying off employees out of seniority order.

In support of the grievances the Union claimed that the Company had breached an established past practice of providing employees with a 40 hour work week guarantee. It also relied on language in the cba providing that "The principle of Plant Seniority shall be applied in cases of layoff, recall, promotion, demotion, reduction and transfer of employees ...." 3M maintained that even if a past practice had existed it was effectively terminated in the last round of negotiations It also pointed to language in the cba providing that employees reporting for work without prior notice that work was not available would be provided with a minimum of four hours pay "except in cases beyond the control of the Company" as evidence that the layoff language did not apply in this situation.

Arbitrator Mario Bognanno rejected the Union's claim of breach of a binding past practice. He found that 3M had notified the Union during negotiations that it was repudiating certain practices, including "Granting employees work when work is not available." He noted:

It is firmly established in labor law, labor arbitration and industrial relations that an enforceable past practice may not be changed during the term of a CBA, without mutual assent. This is the rule, whether the term of employment is implied (i.e., an enforceable past practice) or expressly stated in CBA language. However, absent mutual assent, implied and expressed terms of employment may be changed during the negotiations of a successor agreement. In the present case, 3M repudiated the practice in question (i.e., it withdrew “mutuality”), during negotiations of the current CBA. At that point, for the practice to have continued, the Union, through negotiations, would had to have the terms of the practice explicitly incorporated into the CBA or to have persuaded the Company to objectively retract its expression of repudiation. The record evidence is that the Parties neither incorporated the referenced practice into the current CBA nor did 3M recant. (Un. Ex. 6) For these reasons, the undersigned rejects the Union’s claim that 3M violated an enforceable past practice when it laid off the Grievants in January 2014.

The Arbitrator then turned to an analysis of the impact of the express language of the cba, ultimately reaching different decisions on the two layoffs. With regard to the first, the Arbitrator concluded:

 Record evidence supports the conclusion that the actual curtailment of gas on January 5th and the resulting need to close down production lines was unprecedented, or nearly so, even though Minnesota’s freezing cold January weather is anything but unprecedented. Thus, even though the gas curtailment in question was a possibility, at least to Mr. Rogers, it is properly and sensibly characterized as a condition that 3M could not have reasonably expected. ...
[A]s the Union accurately pointed out, the CBA does not expressly allow management to disregard Article 8, §8.01 and §8.07’s seniority rules. However, as the Company accurately observed, arbitrators often hold that layoffs may be exempted from the seniority rule when unusual, unexpected, unplanned, even emergency, circumstances dictate same. Mr. Wakefield’s decision to have immediately shut down the FATT production lines at 10:00 p.m. on Sunday, January 5th was a necessity.
The first of 3M’s two (2) January 2014 layoff events was an unforeseen emergency that required 3M to immediately shutdown the FATT production lines unfettered by the seniority rule and its time-consuming procedure. Under these circumstances, to penalize 3M would be unjust and wholly inequitable. Thus, under said circumstances, the undersigned concludes, to penalize 3M would be to impose a remedy that the Parties never intended under Article 8. For these reasons, Grievance #2014-14 is denied.

With regard to the second shutdown, however, Arbitrator Bognanno concluded that the Company was now on notice that a shutdown was a possibility, and the Union's grievance made it clear that the Union would be seeking to enforce the seniority provisions of the cba. He sustained the grievances regarding the second layoff, noting:

... it cannot be concluded that on January 26th 3M was confronted by an unforeseen emergency situation. Such an event either was or should have been reasonably anticipated. The record evidence does not credibly explain why 3M did not, as a contingency matter, execute Article 8’s bidding/bumping process among employees working in production operations that most likely would be affected by a gas curtailment. At a minimum, it should have done so during the week of January 19th.In effect, in a contract-compliant way, 3M should have pre-determined who to layoff in the event MERC again cut off its supply of gas. Under the circumstances that prevailed on January 26th, Article 8’s seniority rights would have no meaning whatsoever unless, facing layoff, the affected senior employees were given the opportunity to bid jobs held by junior employees, jobs that they were qualified to work. 

Arbitrator Bognanno's award can be found here.

Sunday, February 1, 2015

Last chance agreement doesn't bar arbitration when union is not a party

An employee of Southwestern Bell Telephone Company represented by the Communications Workers of America filed a grievance over her termination. At the initial step of the grievance process the Company, in the presence of a local Union representative, presented the grievant with a last chance agreement. Pursuant to the terms of the LCA, grievant would be reinstated but, for a period of 24 months, should grievant be suspended or terminated for conduct contrary to the Agreement "any grievance relating in any way to such suspension or dismissal will not be subject to arbitration." The grievant signed the agreement, but the Union did not.

Approximately three months later the employee was dismissed for poor work performance. A grievance was filed and pursued without resolution.  CWA demanded arbitration and the parties selected an arbitrator and scheduled a hearing date. At the hearing the Company, for the first time, refused to arbitrate the dispute. It claimed that the right to arbitration had been waived by the LCA. CWA filed suit to compel arbitration, and the District Court for the Western District of Missouri has granted the Union's request.

The Court described the issue before it as:

 whether the LCA entered into between [grievant] and SWBT supersedes the rights of CWA under the CBA with regard to the arbitrability of grievances. Specifically, Plaintiff contends [grievant's] termination, for alleged just cause, should be subject to arbitration pursuant to Article IV. Defendant claims the right to arbitrate under the CBA was waived when [grievant] voluntarily signed the LCA.

Rejecting the Company's contention that the right to arbitrate the dispute had been waived by the LCA, the Court concluded that the Union's absence as a party to the agreement rendered the agreement essentially unenforceable. The Court noted that the Eighth Circuit had previously held (in Coca-Cola Bottling Company of St. Louis v. Teamsters Local Union No. 688) that a last chance agreement between a Company and Union could effectively modify a cba and bar arbitration of the just cause issue in a subsequent dispute. It noted further, however, that the Eighth Circuit had more recently cautioned against too broad a reading of its decision. In Associated Electric Coop. Inc v. IBEW Local No. 53 the Court refused to bar arbitration where the Union was not a party to the LCA. The District Court also observed that in both cases resolution of the impact of the LCA took place after the arbitrator had issued an award. 

The Court agreed with CWA that:

CWA cannot be estopped from pursuing its right to arbitrate under the terms of the CBA in a contract between only SWBT and an employee. The terms of the CBA covering arbitration are between SWBT and CWA. Article IV references the Union and the Company's right to arbitrate. The CBA contains no provision which empowers an individual employee to waive CWA's rights under the CBA.

The Court's decision in Communication Workers of America v. Southwestern Bell Telephone Co. can be found here. Other issues arising under last chance agreements are discussed here and here.

Sunday, January 25, 2015

Arbitrator: Homicide detective's inattention to cases provides just cause for termination

Grievant was employed as a detective in the Houston Police Department, employed in the homicide division. Upon his transfer out of that division his Lieutenant discovered that in a significant number of grievant's cases had not been updated and, on further investigation, determined that grievant had failed to follow up on a number of cases. The investigation concluded that grievant had also falsified records by claiming to have referred cases to the prosecutor or the grand jury when, in fact, he had not. 

Grievant's employment was terminated for, inter alia, inattention to duties, for untruthfulness concerning the records and reports, and for insubordination (in failing to follow instructions to bring in all files). Grievant challenged the decision and the dispute was submitted to Arbitrator Lynne Gomez for resolution. The Union acknowledged that grievant had not timely updated his files, but maintained that the City had failed to establish the other charges. It claimed that while some discipline was warranted, termination ("indefinite suspension") was unwarranted.

Arbitrator Gomez found that the City had established its charges. She rejected grievant's claim that his case load was excessive and his denial that he had been untruthful.

 Upholding the termination Arbitrator Gomez concluded:

The Union zealously represented the Grievant. However, the totality of the credible evidence presented demonstrates that just cause existed for issuance of the Indefinite Suspension, and that Chief McClelland's decision should not be disturbed. The full impact of the Grievant's misconduct may never be known, but the evidence demonstrated that it allowed murderers to remain on the streets; caused unnecessary frustration and heartache to the families of victims; and led Houston's citizens to question the Department's integrity. The Grievant's misconduct and lack of concern for victims and their families has also caused embarrassment to the Department and, specifically, to Homicide investigators, whose ability to solve cases may be hampered by diminished trust and confidence in the Department. 

The Houston Chronicle reports on the case here and links to the award of Arbitrator Gomez here.

Sunday, January 18, 2015

"Functus officio" precludes arbitrator from substituting new award for an earlier one

Ruling on cross motions for summary judgment, the District Court for the Middle District of Florida addressed the "unique question" of:

whether an arbitrator, having finally addressed the merits of a CBA grievance, may reconsider and substitute an award which substantively changes the result, after being mistakenly persuaded that he had addressed an issue which was not to be arbitrated. 

Concluding that the arbitrator's first award was intended to be final, the Court determined that the doctrine of functus officio precluded the arbitrator from reconsidering the award and substituting a new one.

The dispute arose after several employees of Verizon Florida were declared surplus. The cba provided (in Article XI, Section 2) that surplus employees could bump junior employees within the same or lower wage progression schedule. Article XI also provided that an employee seeking to bump another

must have the ability to perform any job which he/she seeks to obtain through bumping. If it is a job which the employee has previously held, the employee will be allowed a reasonable period of time for re-familiarization and, if the job is one which he/she has not previously held, the employee must be able to perform the job with minimum additional training.

At the arbitration hearing the parties declined to stipulate an issue. The arbitrator framed the issue and, after reviewing the evidence and the cba, concluded that two of the nine grievants had previously held the position they sought to bump into and that they should have been allowed to bump into those positions. He rejected the grievance as it applied to the other grievants.

After the award, the Union requested clarification, maintaining that two additional employees had also previously held the position they sought to bump into and should therefore have been allowed to bump. Verizon opposed this request and also sought reconsideration, claiming that the issue of whether grievant's had previously held the job they sought to bump into was not properly before the arbitrator, and that the only issue was whether the grievants would require more than minimal training to perform the job. Three days after Verizon sought reconsideration the arbitrator issued a substituted decision, captioned "Order on Cross-Motions for Clarification/Change and Substituted Arbitrator's Award. In the new award the arbitrator indicated he had been persuaded that his earlier award had, in fact, relied on a contract provision not submitted for consideration. His new award deleted reference to whether the grievants' had previously held the position and rejected the grievances of all employees. 

The Union sought to vacate the second award while Verizon sought to confirm the second. 

Ruling on both motions the Court concluded:

the issue which the original arbitration award addressed had been presented to the arbitrator through the Union's broadly worded grievance and he was therefore well within his authority in his original determination of the merits. And contrary to the common law doctrine of functus officio, the arbitrator exceeded his authority when he reconsidered and issued the substituted award. The substituted award is therefore due to be vacated and the initial award confirmed.

The court explained:

The doctrine of functus officio ("a task performed") provides that an arbitrator may not revisit the merits of an award once it has issued. Office & Prof'l Emps. Int'l Union, Local No. 471 v. Brownsville Gen. Hosp., 186 F.3d 326, 331 (3d Cir. 1999). Because the arbitrator acts only as judge for a particular case, the doctrine arises "based on the analogy of a judge who resigns his office and, having done so, naturally cannot rule on a request to reconsider or amend his decision." Glass, Molders v. Excelsior Foundry Co., 56 F.3d 844, 846-47 (7th Cir.1995) (observing that an additional rationale is an arbitrator's susceptibility to ex parte communications, absent the constraint of judicial ethics). There are three established exceptions to functus officio, which allow an arbitrator to: (1) correct a mistake that is apparent on the face of the award; (2) rule upon an issue presented but not adjudicated; and (3) clarify an ambiguity in an otherwise complete award. Brown v. Witco Corp., 340 F.3d 209, 219 (5th Cir. 2003); Office & Prof. Emps., 186 F.3d at 331.

Finding that the question initially decided by the arbitrator was within the issue submitted, and that none of the exceptions applied, the court concluded that the arbitrator was without authority to reconsider his decision as Verizon had requested. 

The Court's opinion in IBEW, Local 824 v. Verizon Florida,LLC can be found here.