Wednesday, January 11, 2012

Management rights clause properly subject to arbitral review

          The Eighth Circuit has affirmed enforcement of an arbitration award finding that Breckenridge O'Fallon violated its labor agreement by inconsistently applying its return to work policy. Breckenridge O'Fallon, Inc. v. Teamsters Local Union No. 682.

          Grievant was injured on the job and was out for an extended period. After a workers compensation physician released him to return to work , Breckenridge required him to complete a functional capacity evaluation (FCE) pursuant to its return to work policy. The FCE physician found him unable to return to work, as did another physician selected by grievant from a list provided pursuant to the policy.

          Grievant's personal physician subsequently released him to return to work without restrictions but Breckenridge refused to schedule a second FCE. Grievant and the Union claimed that Breckenridge was inconsistently applying its policy and ultimately arbitrated the issue.

        The arbitrator concluded that while the company had the contractual right to establish reasonable rules, including those relating to FCEs, it had to apply those rules consistently. Finding inconsistent enforcement, the arbitrator ordered the company to schedule grievant for another FCE and to restore his seniority if he passed.

          Breckenridge sought to set aside the award, arguing that it failed to draw its essense from the parties CBA. The district court rejected this claim and the circuit court affirmed.  The court noted that the case was an unusual one because "the grievance as resolved by the arbitrator involved only the CBA's management rights provision. " Nevertheless, the court concluded:

                    When a management rights provision is expressly limited to the right to establish            reasonable work rules, determining whether the employer acted reasonably in adopting and applying its work rules is within the scope of the arbitrators authority to decide a particular grievance the parties have submitted to him.

          The court rejected the company's challenge to the merits of the claim, observing that the correctness of the arbitrator's decision was beyond the scope of their limited review. The court also rejected the company's claim that the award was contrary to the employer's right under the FMLA to require the employee to obtain a third medical opinion when there were conflicting opinions, noting that this right was permissive rather than mandatory, and that nothing in the FMLA diminished the obligation of an employer to comply with its collective bargaining agreement.


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