Irving Materials, Inc. v. Coal, Ice, Building Material & Supply Drivers, Heavy Haulers, Warehousemen & Helpers, Local 716
S.D. Ind.1/3/1992
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ORDER ON MOTIONS FOR SUMMARY JUDGMENT McKINNEY, District Judge. This matter, which raises questions about the power of arbitrators in the labor grievance process, is before the Court on motions for summary judgment by the plaintiff-counterdefendant Irving Materials, Inc. (âIrvingâ or âthe companyâ), and the defendants-counterclaimants, Coal, Ice, Building Material and Supply Drivers, Heavy Haulers, Warehousemen and Helpers Local 716 (the âUnionâ or âLocal 716â), Local 716 president Kenneth Sutton (âSuttonâ), and Local 716 business agent John Marshall (âMarshallâ). Jurisdiction and venue are proper, and both motions are ready for resolution. I. FACTUAL AND PROCEDURAL BACKGROUND The relevant facts are not in dispute. 1 On January 19, 1990, Fred Morris, a member of Local 716 and a cement truck driver for Irving, collided with a Conrail train at a railroad crossing some 200 feet south of the entrance to Irvingâs plant in Greenfield, Indiana. Morris was heading north at 40 miles per hour and failed to see the train, which was approaching from the east, until his truck was approximately 80 feet from the track. Morris, unable to stop, swerved to the left as he passed through the crossing, but failed to clear the track before being hit by the train. The collision caused estimated damage of $15,000. A deputy sheriff who examined the scene concluded that Morrisâs negligence and inattentiveness caused the accident, and that Morris violated Indiana law by failing to yield to the train. The deputy issued no ticket, however, apparently because he did not witness the accident first-hand. Irving promptly discharged Morris. In a letter dated January 19, 1990, the company wrote: This is your third major accident in two years. In January 1988 you turned your truck over on 96th Street causing $5,000 damage to your truck. In August of 1989 you rear-ended a stopped car on I-465 causing $9,734.79 in damages. This latest accident will cost in excess of $15,-000 in damages. The police reported [sic] on this accident indicates a high degree of negligence, disregard of safety rules, careless handling of Company equipment, and/or willful damage to Company equipment. In addition, an inspection of your truck reveals that you have added sunscreen to all windows and your windows are so dirty it is difficult to see out of them. These practices also indicate a high degree of negligence and disregard of safety rules. We are concerned about your personal safety and the safety of the driving public as you are unable to operate a truck safely. [Irving] is exposed to tremendous liability if we continue to allow you to drive one of our trucks. Therefore, we are hereby dismissing you effective January 26, 1990, based on our work rules. See Opinion and Award of Arbitrator Gil Vernon at 2 [hereinafter âAwardâ] (quoting from letter). In terminating Morris, Irving apparently relied on two provisions of the collective bargaining agreement (the âAgreementâ) 2 it had with Local 716: a clause requiring employees to observe cer *971 tain safety regulations pertaining to tools and equipment; 3 and a clause stating that Irving retained all ârights of the traditions of managementâ not specifically limited by the Agreement. 4 The company, despite referring to Morrisâs 1988 and 1989 accidents in its letter, had never disciplined him in any way for these incidents, and did not precede his discharge with any âprogressive disciplineâ â e.g., a suspension or written warning â as required by the Agreement. 5 Shortly after Morris received the letter, the Union filed a grievance in accordance with procedures outlined in the Agreement, 6 claiming that Morris was discharged without just cause 7 or proper warning, 8 and that he therefore was entitled to reinstatement and back wages. Irving and the Union could not resolve the grievance, and it ultimately was referred to arbitration. 9 *972 The parties selected Gil Vernon to decide the dispute, and he conducted a full hearing on December 13, 1990. Vernonâs decision, issued on April 3, 1991, focused on two questions: (1) whether Morris was âguilty of the misconduct with which [he was] accused,â and (2) if yes, whether âthe punishment fit the crime.â Award at 11. In dealing with the first question, Vernon initially found that the evidence did not support a conclusion that Morris caused âwillful damage to Company equipmentâ as charged in the companyâs discharge letter. Vernon went on to determine, however, that Morrisâs inattentiveness and consequent failure to see the train did demonstrate a âhigh degree of negligence.â 10 According to Vernon, this degree of negligence did not rise to the level of gross negligence, recklessness, or a willful disregard of safety; on the other hand, it constituted âsomething more seriousâ than simple negligence. Award at 12. The second question â whether Morrisâs misconduct warranted termination â required greater consideration. Vernon first addressed Irvingâs three asserted justifications for its decision to discharge Morris: (1) the threat of a âwillful retentionâ suit by the driver of the car involved in Morrisâs July 1989 accident; (2) a possible loss of insurance coverage; and (3) Morrisâs past record of accidents in company vehicles. 11 Vernon dismissed these rather quickly, stating that no real threat of a negligent retention suit had been shown, and that evidence which suggested that Irving might lose insurance coverage â a letter from an agent â was not probative because the agent was inclined to say whatever Irving wanted. Vernon also concluded that Irving had âwaived its right to attach any disciplinary consequenceâ to Morrisâs previous accidents, because it had not imposed timely discipline for them. See Award at 13-14. Vernon then discussed Irvingâs failure to adhere to progressive discipline. Irving admitted that it had not followed the Agreementâs requirement for progressive discipline, but claimed that Morrisâs conduct was serious enough to warrant immediate termination. Vernon conceded that some offenses â âtheft, punching out a supervisor, etc.â â might justify immediate discharge, but noted that other offenses, such as negligence, âvary in ... seriousnessâ and âbecause of varying circumstances, might warrant immediate discharge in one instance but require a warning/suspension prior to discharge in another.â While acknowledging that it was a âdifficult call to make,â Vernon concluded that the circumstances did not justify immediate discharge in this case. Vernon stated that he was led to this conclusion by the fact, âmore than any other,â that âthe Company has benignly condoned, if not blatantly tolerated, carelessness on the part of [Morris], as well as *973 other employees, in the past.â By failing to discipline Morris for the earlier accidents, Irving sent the message that â[t]here was no penalty for negligence.â Morris, therefore, had been discharged without just cause. Id. at 14-15. Still, Vernon felt that Morris bore some responsibility for the accident, so he ordered a ten day suspension and conditioned Morrisâs reinstatement on the âsuccessful completion of a remedial/defensive driving skills course and the presentation of a valid license necessary to operate the Companyâs truck.â Id. at 17. On April 17, 1991, Irving filed its complaint in this Court to vacate the arbitratorâs award, pursuant to § 301 of the Labor Management Relations Act of 1947, 29 U.S.C. § 185 , and the Arbitration Act, 9 U.S.C. § 10 (d). The Union, Sutton, and Marshall counterclaimed for enforcement of the award on May 24, 1991. Irving moved for summary judgment on July 2, 1991, on grounds that (1) Vernon, by ordering Morrisâs reinstatement despite agreeing that he had demonstrated a high degree of negligence, exceeded his powers as arbitrator under the collective bargaining agreement, and (2) the award, even if properly made, nevertheless violated public policy. The defendants responded by filing their own motion for summary judgment on August 1, 1991. II. DISCUSSION A. Summary Judgment Standard Motions for summary judgment are governed by Rule 56(c) of the Federal Rules of Civil Procedure, which provides in relevant part: The judgment sought shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. When the standard embraced in Rule 56(c) is met, summary judgment is mandatory. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 , 106 S.Ct. 2548, 2552 , 91 L.Ed.2d 265 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-50 , 106 S.Ct. 2505, 2510-11 , 91 L.Ed.2d 202 (1986). As stated in Celotex, summary judgment is not a disfavored procedural shortcut, but rather is an integral part of the Federal Rules as a whole, which are designed to secure the just, speedy, and inexpensive determination of every action. Celotex, ill U.S. at 327, 106 S.Ct. at 2555. Decisions of the Seventh Circuit are in conformity with this view. See, e.g., Patrick v. Jasper County, 901 F.2d 561, 565 (7th Cir.1990); Spellman v. Commissioner, 845 F.2d 148, 151-52 (7th Cir.1988). Moreover, the mere existence of a factual dispute is not by itself sufficient to bar summary judgment; the disputed fact must be outcome determinative. Anderson, 477 U.S. at 248, 106 S.Ct. at 2510; International Bhd. of Boilermakers v. Local D354, 897 F.2d 1400, 1406 (7th Cir.1990). Irrelevant or unnecessary facts do not preclude summary judgment even when in dispute. Clampitt v. Ft. Wayne, 682 F.Supp. 401 (N.D.Ind.1988), affâd, 864 F.2d 486 (7th Cir.1988). In this case, the parties do not dispute the relevant facts, and all agree that summary judgment is appropriate. B. Review of Arbitratorâs Decision (1) General Considerations When parties agree to submit labor contract interpretation disputes to arbitration, the arbitratorâs decision âbinds the court asked to enforce the award or to set it aside.â Chicago Typographical Union v. Chicago Sun-Times, 935 F.2d 1501, 1505 (7th Cir.1991) (citations omitted). As the Supreme Court has stated: [Cjourts are not authorized to reconsider the merits of an award even though the parties may allege that the award rests on errors of fact or on misinterpretation of the contract. âThe refusal of courts to review the merits of an arbitration award is the proper approach to arbitration under collective bargaining agreements. The federal policy of settling labor disputes by arbitration would be under *974 mined if courts had the final say on the merits of the awards.â United Paperworkers v. Misco, 484 U.S. 29, 36 , 108 S.Ct. 364, 370 , 98 L.Ed.2d 286 (1987) (quoting United Steelworkers v. Enterprise Wheel & Car Corp., 363 U.S. 593, 596 , 80 S.Ct. 1358, 1360 , 4 L.Ed.2d 1424 (1960)). As a result, a court âis forbidden to substitute its own interpretation even if convinced that the arbitratorâs interpretation was not only wrong, but plainly wrong.â Chicago Typographical, 935 F.2d at 1505 ; see also E.I. DuPont de Nemours v. Grasselli Employees Indep. Assân, 790 F.2d 611, 614 (7th Cir.), cert. denied, 479 U.S. 853 , 107 S.Ct. 186 , 93 L.Ed.2d 120 (1986). This deferential approach embodies the statutory lawâs âdecided preference for private settlement of labor disputes without the interference of government.â Misco, 484 U.S. at 37 , 108 S.Ct. at 370 . Consequently, courts will be obliged to enforce most of the arbitration awards they review. Absolute deference is not required, however. Case law indicates that a court may refuse to enforce an arbitration award in three narrow situations: (a) when the dispute arguably was not arbitrable, or was submitted to the arbitrator improperly or prematurely, Sheet Metal Workers Local 20 v. Baylor Heating, 877 F.2d 547, 551 (7th Cir.1989); (b) when the award violates, or fails to âdraw its essence from,â the governing collective bargaining agreement, Enterprise Wheel & Car, 363 U.S. at 597 , 80 S.Ct. at 1361 ; Chicago Typographical, 935 F.2d at 1505 ; or (c) when enforcement of the award would violate public policy. Misco, 484 U.S. at 42-45 , 108 S.Ct. at 373-74 ; W.R. Grace & Co. v. Local Union 759, United Rubber Workers, 461 U.S. 757, 766 , 103 S.Ct. 2177, 2183 , 76 L.Ed.2d 298 (1983). Irving does not claim that its disagreement with the Union was not arbitrable or was submitted to arbitration improperly; the company does claim, however, that the remaining two grounds apply here and require vacation of the award. The Court will address each of these grounds in turn. (2) Violation of the Agreement Most suits seeking the vacation of arbitration awards try to show that the arbitrator failed to base his award on the governing collective bargaining agreement, thereby exceeding his authority. In general: [A]n arbitrator is confined to interpretation and application of the collective bargaining agreement; he does not sit to dispense his own brand of industrial justice. He may of course look for guidance from many sources, yet his award is legitimate only so long as it draws its essence from the collective bargaining agreement. When the arbitratorâs words manifest an infidelity to this obligation, courts have no choice but to refuse enforcement of an award. Enterprise Wheel & Car, 363 U.S. at 597 , 80 S.Ct. at 1361 ; see Chicago Typographical, 935 F.2d at 1505 . Arbitration clauses generally limit arbitrators to interpreting the agreements of which they are part; as a result, arbitrators can exceed their authority by basing awards on personal views, Chicago Typographical, 935 F.2d at 1505 , or on positive law not invoked by the agreements, Roadmaster Corp. v. Production & Maintenance Employees Local 504, 851 F.2d 886, 888-89 (7th Cir.1988), or by imposing terms clearly not contemplated by the parties. See Sheet Metal Workers, 877 F.2d at 555-56 . On the other hand, arbitrators typically may refer to sources outside the agreement, such as their own experiences or the âindustrial common law,â in interpreting difficult or ambiguous provisions. See United Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 581-82 , 80 S.Ct. 1347, 1352-53 , 4 L.Ed.2d 1409 (1960); Tootsie Roll Indus. v. Local Union No. 1, Bakery, Confectionery & Tobacco Workers, 832 F.2d 81, 84 (7th Cir.1987) (noting limited circumstances in which this is allowed). Despite these general rules, however, it is increasingly clear that an arbitrator can do nothing beyond what he is empowered to do by the collective bargaining agreement. The validity of a given award therefore will depend on whether the arbitrator has complied with the express stipulations of the *975 parties, who are free to restrict or expand arbitrator authority beyond usual norms. See Chicago Typographical, 935 F.2d at 1505 . (a) Just Cause Irvingâs first claim that Vernon exceeded his authority rests on three assumptions: (a) that Vernon found Morris âguilty of the misconduct with which he was charged,â i.e., a high degree of negligence; (b) that a high degree of negligence constitutes just cause for discharge under the Agreement; and (c) that Vernon, having found just cause, had no choice but to uphold the companyâs termination decision. The first assumption is correct; it is clear that Vernon found Morris âguiltyâ of a âhigh degree of negligence.â The second assumption, howeverâand by derivation the thirdâis not supported by the language of the Agreement. Vernon had substantial discretion to interpret and apply the Agreement, so long as he did not âadd to, subtract from, or in any way modifyâ its terms. Agreement, Article XXIII, Section 3. Because it had no express limitations, 12 this power included the authority to determine just causeâ â[pjerhaps the single most significant and common issue to which [judicial] deference extends.â See Florida Power Corp. v. International Bhd. of Elec. Workers, Local 433, 847 F.2d 680, 681-82 (11th Cir.1988) (citing several cases). Vernon therefore possessed broad discretion to determine the existence of just cause for Morrisâs discharge. See Crafts Precision Inds. v. Lodge No. 1836, Intâl Assân of Machinists, 889 F.2d 1184, 1185-86 (1st Cir.1989); see also DuPont, 790 F.2d at 614-15 (upholding arbitrator, because âmere disagreement does not allow an overturning of the awardâ). Given the scope of his power, Vernonâs determination that Morris was discharged without just causeâdespite finding a high degree of negligenceâwas entirely proper, because it was his decision to make. See Crafts Precision, 889 F.2d at 1185-86 (upholding arbitratorâs reversal of termination for violation of shop rule, because agreement, although stating that violation could result in discharge, did not state that it would result in discharge). The sections of the Agreement relied on by Irving do not affect this conclusion. It is true that Irving retained all management and workforce direction rights ânot specifically limitedâ by the Agreement, but this did not constitute a reservation of the right to determine just cause, and could not overcome Vernonâs general authority to interpret the Agreement. In addition, the Agreement does not list specific acts or conductânegligence includedâthat constitute just cause for discharge; in fact, it does not define âjust causeâ at all. See Agreement, Article XVII, Section 2. 13 Vernon therefore had no contractual limits or mandates as to what specific incidents âjust causeâ would or would not include. See Litvak Packing v. United Food & Commercial Workers, Local No. 7, 886 F.2d 275, 276 (10th Cir.1989) (upholding arbitratorâs finding that employeeâs âcarelessness, laziness, and neglect, none of which are mentioned specificallyâ in agreement, âdid not constitute just and sufficient causeâ to fire the employee). In addition, Irvingâs repeated assertions that Vernon found Morris guilty of âdisregard[ing] safety rulesâ are without merit. First, the Court cannot find such a holding anywhere in Vernonâs award. Second, Irving has cited no specific company *976 rules that Morrisâs actions violated. 14 Finally, Irving appears to take the section of the Agreement stating that âall employees shall strictly observe all applicable federal and state safety regulationsâ out of proper context. The quoted section (Article XVI, Section 3) seems narrowly to invoke federal and state safety codes that pertain to the maintenance of tools and equipment. See supra note 3. Irving apparently reads the provision broadly, to include local traffic laws as they may apply to an employeeâs operation of âvehicular equipment.â While this interpretation is not totally implausible, Vernon was within his authority to interpret the section more narrowly, and to conclude that it did not apply to Morrisâs case. The cases cited by Irving do not command a different result. In BallwinWashington, Inc. v. International Assân of Machinists, 615 F.Supp. 865 (E.D.Mo.1985), the collective bargaining agreement provided that an employeeâs violation of a contractual âthree day â no reportâ rule would provide the employer with just cause for dismissal; in fact, termination was the companyâs exclusive remedy. The company discharged an employee who violated the rule, but an arbitrator found that the violation was unintentional and rescinded the discharge. The district court vacated this award, holding that the agreement âclearly state[d] that termination is the sole disciplinary action available for violationâ of the rule, and that the arbitrator, having found a violation (intentional or not), had no choice but to affirm the companyâs decision. Id. at 870 . Similarly, in Florida Tel. Corp. v. Communication Workers of Am., 475 F.Supp. 213 (M.D.Fla.1979), the arbitrator found that âthe employer had just cause ... to impose a severe penaltyâ on an employee who had committed an act specified in the agreement as constituting cause for discharge. See id. at 214-15 and n. 1. Nevertheless, the arbitrator reduced the discharge to a suspension. The district court, although acknowledging the arbitratorâs general power to review disciplinary actions, held that he could not reduce the companyâs choice of penalty once he found that just cause existed, because the governing agreement placed discretion to impose penalties âsolely and exclusively in the company.â Id. at 216 . Ballwin-Washington and Florida Telephone, while informative, are distinguishable from Morrisâs situation, because the arbitrators in those cases found that the discharged employees had engaged in conduct which, by express terms of the governing agreements, justified their termination. The arbitratorâs findings therefore constituted âimplicitâ conclusions that just cause existed. See Delta Queen Steamboat Co. v. District 2 Marine Engârs Beneficial Assân, 889 F.2d 599 (5th Cir.1989) (stating that âshould the arbitrator âimplicitly findâ that proper cause exists, he need not recite the operative phraseâ), cert. denied, â U.S. â, 111 S.Ct. 148 , 112 L.Ed.2d 114 (1990). Here, in marked distinction, the Agreement specifies no acts or offenses that constitute just cause for discharge, and Vernon expressly found that no just cause existed. Vernonâs decision that Morris showed a high degree of negligence, therefore, did not equal an implicit finding that Morris was terminated for just cause. (b) Reference to Other Employees Irving also claims that Vernon exceeded his authority by basing his award on âthe fact that the Company ... benignly condoned, if not blatantly tolerated, carelessness on the part of [Morris], as well as other employees, in the past.â See Award at 15. According to Irving, this statement shows that Vernon improperly reached a decision based on how the company has treated other employees in past similar situations, rather than on the Agreement. In support of this position, Irving cites Delta Queen Steamboat Co., 889 F.2d at 599 , Container Prods., Inc. v. United Steel *977 workers, 873 F.2d 818 (5th Cir.1989), and Local 814, Intâl Bhd. of Teamsters v. Sothebyâs, Inc., 665 F.Supp. 1089 (S.D.N.Y.1987). In these cases, the arbitrators modified employer-imposed penalties after comparing them with disciplinary treatment of other employees who had committed similar infractions. In each case, the arbitratorâs award was vacated. Delta Queen, 889 F.2d at 604 ; Container Products, 873 F.2d at 820 ; Sothebyâs, 665 F.Supp. at 1096 . Despite factual similarities to the situation here, the cited cases do not support Irvingâs position. In each case, the arbitrator found just cause for discharge, at least implicitly, and having made such a finding was prevented by the Agreement from disturbing the employerâs choice of discipline. See Delta Queen, 889 F.2d at 601 ; Container Products, 873 F.2d at 819-20 ; Sothebyâs, 665 F.Supp. at 1092 . 15 Here, by contrast, Vernon made no finding of just cause â either implicit or explicit â and expressly reached the opposite conclusion. Moreover, there is no language in the Agreement âwhich expressly limits or removes from the arbitrator the authority to review the remedy in this case.â Eberhard Foods, Inc. v. Handy, 868 F.2d 890, 892 (6th Cir.1989). Just as important, however, is the fact that Vernonâs decision â despite briefly mentioning other employees â appears to have been based primarily on Irvingâs failure to adhere to progressive discipline. Vernon stated that âthe Company has benignly condoned, if not blatantly tolerated, carelessness on the part of the Grievant, as well as other employees, in the past.â Award at 15 (emphasis added). This statement, combined with the finding that Irving did âabsolutely nothingâ to warn Morris that ânegligent handling of his truck would result in discharge,â strongly supports a conclusion that Vernon found Irving to be in violation of the Agreementâs recognition of progressive discipline. Id. The treatment of other employees, in Vernonâs own words, simply âreinforced [the companyâs] tolerant attitudeâ toward negligence. As such, their cases may have supplied some minor âguidanceâ to Vernon, see Enterprise Wheel & Car, 363 U.S. at 597, 80 S.Ct. at 1361, but do not appear to have played any more significant role in his decision. See Award at 16. It is true that Vernon could not disregard the Agreement and base an award on his âown personal notions of right and wrong.â DuPont, 790 F.2d at 614 . Vernon did not do this, however; he simply interpreted that part of the Agreement dealing with progressive discipline, and this was well within his authority. (3) Violation of Public Policy Even if an arbitrator acts within his authority in deciding a labor contract dispute, his award will not be enforced if it violates public policy. Misco, 484 U.S. at 42-43 , 108 S.Ct. at 373 ; W.R. Grace & Co., 461 U.S. at 766 , 103 S.Ct. at 2183 ; Sheet Metal Workers, 877 F.2d at 551 . The public policy allegedly violated, however, âmust be well defined and dominant, and is to be ascertained âby reference to the laws and legal precedents and not from general considerations of supposed public interests.â â W.R. Grace & Co., 461 U.S. at 766 , 103 S.Ct. at 2183 (quoting Muschany v. United States, 324 U.S. 49, 66 , 65 S.Ct. 442, 451 , 89 L.Ed. 744 (1945)). If the supposed public policy is not properly established, the arbitration award will not be set aside, no matter how âfirmly rooted in common senseâ a decision to vacate might be. Misco, 484 U.S. at 44 , 108 S.Ct. at 374 . Irving alleges that Vernonâs award violates âthe publicâs interest in having safe drivers on the road who do not repeatedly violate traffic rules and regulations,â which is a âpublic policy ... embodied in the case law, statutory law, and pure common sense.â In support, Irving cites numerous federal and state laws that Mor *978 risâs driving has supposedly violated. 16 Irving also points out that Morris âwas involved in three serious accidents in the two years preceding his discharge,â and that his driving record is less than stellar. According to Irving, the combination of these factors âinescapably lead[s] to the conclusion that the arbitratorâs order to reinstate [Morris] is clearly in contravention of public policy.â See Plaintiffs Supporting Memorandum at 19-21; Plaintiffâs Reply/Response at 17-20. To be successful, Irvingâs arguments must meet the standards set out in Misco . In that case, a company employee was âapprehended by police in the back seat of his car with marijuana smoke in the air and a lighted marijuana cigarette in the frontseat ashtray.â Misco, 484 U.S. at 33 , 108 S.Ct. at 368 . The company, which had a rule against drug use on company property, discharged the employee. The arbitrator, finding that the company failed to prove that the employee actually had used the marijuana, reinstated him. Id. at 34 , 108 S.Ct. at 368 . The district court and the Fifth Circuit Court of Appeals both held that the arbitratorâs award must be set aside, because it violated a public policy âagainst the operation of dangerous machinery by persons under the influence of drugs or alcohol.â Id. at 35 , 108 S.Ct: at 369. The Supreme Court reversed, holding first that the courts below had failed to âestablish a âwell-defined and dominantâ policy against the operation of dangerous machinery while under the influence of drugs.â Id. at 44 , 108 S.Ct. at 374 . The Court stated that â[although such a judgment is firmly rooted in common sense,â it was founded on âa formulation of public policy based only on âgeneral considerĂĄ-tions of supposed public interestsâ â and was ânot the sort that permits a court to set aside an arbitration award that was entered in accordance with a valid collective-bargaining agreement.â Id. The Court then held that even if the supposed public policy had been sufficiently well-defined, the connection between discharge of the employee and promotion of the policy was âtenuous at best,â and provided an insufficient basis for vacating the arbitratorâs award. As the Court stated, ârefusal to enforce an award must rest on more than speculation or assumption.â Id. In light of Misco , Irvingâs claim fails. Initially, the Court is not convinced that the cited group of individual laws, although clearly related to traffic regulation, necessarily embody the policy advanced by Irving. See Nupulse, Inc. v. Schlueter Co., 853 F.2d 545, 548-49 (7th Cir.1988) (discussing the standards for determining the meaning and purpose of statutes). 17 Ultimately, however, this issue is not critical, because even if such a policy exists, Irving has failed to show how Vernonâs reinstatement of Morris would violate it. Irving has cited no law that prohibits the employment, reemployment, or reinstatement of an employee who has been involved in an accident, whether ticketed or not, and the Court knows of no such prohibition. Vernonâs award therefore does not violate any established law or legal precedent. See id. at 44. 18 Irving also has failed to show that Morris is not a âsafe driver.â Vernon â the fact-finder chosen by the parties â examined all the evidence about Morrisâs driving, including his accident record, yet decided to reinstate him. The Court will not second-guess this decision. 19 *979 III. CONCLUSION In sum, the Court concludes that Vernonâs decision to reinstate Morris conditionally was properly rendered, because it did not contravene the partiesâ collective bargaining agreement and did not violate any well-defined public policy. Accordingly, the Court DENIES Irvingâs motion for summary judgment, GRANTS the defendants/counterclaimantsâ motion for summary judgment, and ORDERS that the arbitration award be ENFORCED. SO ORDERED. 1 . The Court derives its factual summary from the partiesâ pleadings, as elaborated by the findings of arbitrator Gil Vernon in his Opinion and Award of April 3, 1991 (a copy of which was attached as Exhibit B to Defendantsâ Memorandum in Support of Motion for Summary Judgment). 2 . The Agreement went into effect April 1, 1989 and expires at midnight March 31, 1992. 3 . Article XVI, Section 3 of the Agreement states, in relevant part: All equipment and tools shall be maintained in a safe and efficient working order and regulations and safety codes adopted by appropriate federal and state agencies, in the interest of protecting health and safety of employees as they affect this industry, shall be strictly observed by both the employers and the employees. Although Irving referred to "our work rules" in its letter to Morris, it has not asserted in this action that Morris violated any specific company-made rules. See infra note 8. 4 . Article XXV of the Agreement states: All of the traditions of the management of the business and the direction of the work force which are not specifically limited by the expressed language of this Agreement are exclusively vested in and retained by the Employer. 5 . Article XVII, Section 2 states: "The Employer and the Union recognize the principle of progressive discipline. A disciplinary measure more than twelve (12) months old shall be removed from an employeeâs record.â 6 . Article XXIII of the Agreement outlines the proper grievance procedure, and states in part: When any question arises between an employee and the Employer or between the Employer and the Union, concerning the meaning and application of the terms of this Agreement, which cannot be satisfactorily settled with the employee's foreman or supervisor ... such question shall be settled in accordance with the following grievance procedure: The employee affected, the Union or the steward shall reduce the question to writing on the form furnished by the Union within five (5) working days of the day that the employee knew, or by the exercise of reasonable diligence should have known, of its occurrence. The employee, the Union or the steward shall then take up the question with the foreman, or supervisor (if the Employer has such representative), or with the Employer directly. Failing satisfactory adjustment, the question shall then be taken up within a further period of five (5) working days between the Employer and a representative of the Union. Failing satisfactory adjustment within ten (10) working days from the time of discussion between the Employer and the Union, any question as to the meaning, interpretation, or application of the provisions of this Agreement, shall be referred to arbitra-tion_ Agreement, Article XXIII, Section 1 (attached as Exhibit A to Plaintiffs Complaint to Vacate Arbitratorâs Award). 7 . Article XVII, Section 2 of the Agreement states in part: No employee shall be disciplined or discharged except for just cause_ Any employee who is subject to disciplinary action under this Section shall receive written notice of such within five (5) scheduled working days after the Employer is made aware of the infraction, with a copy going to the employee, steward and the Union. Failure on the part of the Employer to issue such notice will result in the disciplinary action being voided. 8 . In addition to alleging a lack of required progressive discipline, the Union claimed that the "safety rulesâ supposedly disregarded by Morris, insofar as they were rules made by Irving, did not comply with the notice requirements of the Agreement: The Employer shall have the right to make rules from time to time, provided, that no rule shall be effective unless: (a) A copy has been previously sent to the offices of the Union. (b) It has been posted. (c) It is not in violation of the terms of this Agreement. (d) It is reasonable. It is understood that the Union has the right to grieve on the question of whether or not a rule violates the terms of this Agreement or is unreasonable. In connection with a grievance against a penalty imposed by the Employer for the violation of a rule, the Union shall have the right to raise the question of whether or not the rule is in violation of this Agreement or is unreasonable as well as whether or not the employee violates the rule and whether the penalty imposed by the Employer is proper. Agreement, Article XVI, Section 4. 9 . Article XXIII, Section 2 of the Agreement states: *972 Either party may refer the question involved to arbitration by written notice to the other within the ten (10) working days from the discussion between the Employer and a representative of the Union. When such written notice is given, the Employer and the Union shall seek to agree upon an arbitrator. If they fail to agree within five (5) working days from the date of said written notice, they shall jointly request the Federal Mediation and Conciliation Service to furnish a list of five (5) persons qualified to act as an arbitrator from which list they shall alternately strike until one remains. The person whose name remains shall be appointed the arbitrator. 10 . Specifically, Vernon stated: In the Arbitratorâs opinion, for a professional driver not to notice something as big and bright as two blue locomotives moving along with several cars, is a high degree of negligence. While there were no lights at the crossing and while the horn/whistle might not have been detectable in the cab of the cement mixer, it still is difficult to understand why a reasonably attentive driver would not have noticed the engine or at least noticed that other traffic was stopped at the crossing. The Union is right that [Morris] is guilty of only inattentive driving, but under these circumstances, this demonstrates a high degree of negligence. Award at 12 (emphasis in original) (footnote omitted). 11 . Irving also urged Vernon to sustain the discharge on the ground that Morris's negligence constituted a violation of law. Vernon dismissed this ground because it was not mentioned in the discharge letter, and because Morris was not cited for any violation stemming from the accident. Award at 12 n. 1. 12 . Parties may limit an arbitrator's authority by expressly removing the just cause determination from his scope of authority, see International Bhd. of Elec. Workers v. Sawnee Elec. Membership Corp., 862 F.2d 1534, 1536 (11th Cir.1989), or by enumerating the specific items that will constitute just cause. See Delta Queen Steamboat Co. v. District 2 Marine Engârs Beneficial Assân, 889 F.2d 599, 601 (5th Cir.1989), cert. denied, â U.S. -, 111 S.Ct. 148 , 112 L.Ed.2d 114 (1990). Neither limitation is present in the Agreement here. 13 . The only possible exception is found in Article XVII, Section 3, which states that â[n]o em *976 .ployee shall refuse to obey an order.â This provision is not at issue here. 14 . As noted earlier, the Agreement has strict requirements regarding enforcement of company-made rules. See supra note 8. 15 . In Container Products, the finding of just cause was not perfectly clear, but the Fifth Circuit held that the arbitrator, by stating that "evidence of cause for discharge ... has been presented by the Company," had "implicitly found the existence of just cause for dismissal.â Container products, 873 F.2d at 819-20 . 16 . Among the laws Irving cites is Indianaâs codification of the Uniform Act Regulating Traffic on Highways, Ind.Code §§ 9-4-1-1 to 9-4-1-136. This entire section, however, has been repealed. See Ind.Code Arm. § 9-4-1-1 (West Supp.1991). 17 .Indeed, the stated purpose of the repealed Uniform Act Regulating Traffic on Highways, rather than âhaving safe drivers on the road who do not repeatedly violate traffic rules,â was "to make uniform the law of those states which enact it.â Ind.Code § 9-4-1-136 (1979) (now repealed). 18 . This Court does not reach the issue of whether public policy is violated only if a positive law is broken. See DuPont, 790 F.2d at 616 ; id. at 617-20 (Easterbrook, J., concurring). 19 . Any examination of Vernonâs conclusions about Morris as a driver would be improper, because this would approach the kind of review on the merits that this Court is forbidden to *979 conduct. See Chicago Typographical, 935 F.2d at 1504-05 . Moreover, the Court notes as a practical matter that it is unlikely Vernon would have reinstated Morris to a truck-driving position â even conditionally â if he had believed him to be unsafe.
Case Information
- Court
- S.D. Ind.
- Decision Date
- January 3, 1992
- Status
- Precedential