Sunday, May 12, 2013

NLRB Defers to Arbitrator's award despite limited remedy

NLRB Acting General Counsel Lafe Solomon has announced his intent to ask the Board to revise its standards for deferring to arbitrators' awards in cases alleging unlawful discrimination because of an employee's union or other protected concerted activity. Guideline Memorandum Concerning Deferral to Arbitral Awards and Grievance Settlements in Section 8(a)(1) and (3) cases. While the Board has not yet ruled on that request, it has recently reaffirmed its decision to defer unless the arbitrator's award is "clearly repugnant" to the Act.

Sheds Jacksonville Medical Center, Inc. involved a claim that the employer had unlawfully dismissed an employee because of her activity on behalf of the Union representing the Center's employees. The employee had been dismissed after the employer concluded that she had distributed a Union flyer on work time and in work areas. The employer claimed that the flyer called for an unauthorized work stoppage. An unfair labor practice charge was filed but the processing of the charge was deferred to the grievance/arbitration procedures. The Union grieved the dismissal, and Arbitrator Richard Potter concluded that while the employee had distributed the flyer on duty time and in a work area as alleged, the Medical Center's enforcement of its no distribution policy was lax, the flyer did not call for a job action, and that the activity was brief and casual and did not require her to sign out for Union duties. However, because he concluded that the employee had lied about the distribution, both during the Medical Center's investigation and at the hearing he ordered her reinstated without back pay.

The Acting General Counsel issued a complaint on the ulp charge and asserted that the deferral to the arbitrator's award was unwarranted. The ALJ disagreed and dismissed that portion of the  complaint. On appeal, the Board affirmed the ALJ's decision.The Board expressly declined to consider the Acting General Counsel's request to modify it deferral standards at this time.  Applying its traditional standard, it noted that the proceeding was fair and regular, that the parties had agreed to be bound, and that the issue before the Arbitrator was  factually parallel to that in the ULP proceeding. The only remaining question was whether the award was "clearly repugnant" to the Act. Addressing the issue of the Arbitrator's decision not to award back pay, the Board observed: 

As a general matter, the mere fact that an arbitration award is not coextensive with the Board’s usual remedies does not, without more, make the award clearly repugnant to the Act. ... More specifically, an award that reinstates an employee without full backpay and accrued benefits is not necessarily inconsistent with the Act. Indeed, the Board itself has, at times, decided not to grant those
remedies where doing so would not effectuate the policies of the Act.

The Board noted that while the employee's lie during the employer's investigation might arguably be protected, a lie during the arbitration hearing clearly was not. It concluded:

In making the latter observation, we are mindful that the arbitrator did not state whether he would have denied Palmer backpay based only on her lie at the arbitration hearing, and, from the record before us, it is not possible to say definitively that the arbitrator denied Palmer backpay for conduct at the hearing that was completely unrelated to her arguably protected conduct. Our established policy, however, is to defer to arbitration decisions unless they are “not susceptible to an interpretation consistent with the Act.” Olin, 268 NLRB at 574. Because the arbitrator’s award can be interpreted in a way consistent with the Act (i.e., that backpay was denied because Palmer lied under oath), we find that the arbitrator’s denial of backpay and credit for time lost does not make the award repugnant to the Act. [footnote omitted].

The Board left for another day a decision on the Acting General Counsel's request to modify its deferral procedures.

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