International Brotherhood of Teamsters Local Union No. 618 v. Henkel Consumer Products

Filing 39

MEMORANDUM AND ORDER re: 27 MOTION for Summary Judgment filed by International Brotherhood of Teamsters Local Union No. 618, 24 MOTION for Summary Judgment filed by Defendant Henkel Consumer Products. IT IS HEREBY ORDER ED that plaintiff's motion for summary judgment (#27) is DENIED. IT IS FURTHER ORDERED that defendant's motion for summary judgment (#24) is GRANTED. The arbitration award is hereby CONFIRMED. Signed by District Judge Stephen N. Limbaugh, Jr on 10/26/18. (CSG)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
INTERNATIONAL BROTHERHOOD
OF TEAMSTERS LOCAL UNION
NO. 618,
Plaintiff,
v.
HENKEL CONSUMER PRODUCTS,
Defendant.

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Case No. 4:18-cv-00185-SNLJ

MEMORANDUM AND ORDER
This matter comes before the Court on the parties’ respective motions for
summary judgment. Both motions involve an underlying arbitration award. Plaintiff seeks
to vacate the arbitration award; whereas, defendant—as counterclaimant—seeks to
confirm it. As authority, they cite Section 301 of the Labor Management Relations Act,
29 U.S.C. §§ 185, et seq. and the standards of review under the Federal Arbitration Act, 9
U.S.C. §§ 1 et seq.
I.BACKGROUND
On January 31, 2017, Mitch Wright—a member of plaintiff and employee of
defendant—was suspended for five days without pay and administered a “first written
warning” under defendant’s “plant rules” for disruptive conduct at a workplace meeting.
Wright filed a grievance challenging the disciplinary actions taken by defendant, which
ultimately resulted in an arbitration hearing taking place on August 22, 2017. The issue
presented to the arbitrator, as explained in the arbitration award, was “whether the
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[defendant’s] decision to suspend [Wright] for violating [defendant’s] Plant Rule III-S,
was for proper cause, and, if not, what shall be (sic) the remedy be?” On November 10,
2017, the arbitrator issued a decision both sustaining and denying the grievance in part. In
partially granting the grievance, the arbitrator found defendant did not have proper cause
to suspend Wright without pay and directed defendant to pay Wright five days’ worth of
backpay. In partially denying the grievance, the arbitrator also found the paid suspension
should “follow the normal course of such warnings in the collective bargaining
agreement and/or rules and that it will be placed in [Wright’s] file accordingly effective
for one (1) year (12 months) forward on the day he receives his backpay.”
The parties’ dispute revolves around the arbitrator’s decision to uphold the “first
written warning” for a period of one year following the arbitration hearing. Plant Rules
state that “warning notices are cumulative, regardless of the nature of the violation,
starting with the first written warning notice” and indicate that cumulative warnings in a
twelve-month period can result in discharge of employment. Plant Rules also state that
“warning notices will remain in effect for twelve months.” It is plaintiff’s contention the
arbitration award must be vacated because the arbitrator improperly extended Wright’s
first warning beyond twelve months when ordering the first warning to be held in
Wright’s file for one year following defendant’s payment of backpay post-arbitration. In
so contending, plaintiff notes the parties’ collective bargaining agreement, under Article
27, prohibits the creation of a “new rule” without first informing members of the
effective date and reason for the rule—apparently implying the arbitrator’s decision
either constitutes a new rule or otherwise extends the old rule governing the period for
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which a warning remains on an employee’s record. Conversely, defendant contends the
twelve-month requirement has not, in fact, been violated because Wright’s first warning
only had potential cumulative effect upon the arbitrator’s confirmation of that warning—
in other words, the warning only took effect, and the clock first began to run, upon it
being upheld by the arbitrator.
Plaintiff provides three reasons for vacating the arbitration award: (1) the
arbitrator exceeded his authority by “ignoring the clear and unambiguous language” of
the “CBA and Plant Rules” by “extending the time limit for written warnings”; (2) the
arbitrator exceeded his authority by “ruling on an issue of extending the time limit for
written discipline” though that “issue was never presented to the arbitrator at the
hearing”; and (3) the arbitrator’s decision to “extend the one-year limit on written
warnings for a single disciplinary event” amounts to impermissible double jeopardy.
II. ANALYSIS
1. Legal Standard Applicable to the Review of Arbitration Awards
This dispute regarding the parties’ arbitration award is governed by the Federal
Arbitration Act (FAA), 9 U.S.C. §§ 9-16, which established a highly deferential standard
of review of an arbitrator’s decision. Moses H. Cone Mem. Hosp. v. Mercury Const. Co.,
460 U.S. 1, 24 (1983). The Court accords an “extraordinary level of deference” to the
underlying award “because federal courts are not authorized to reconsider the merits of
an arbitral award ‘even though the parties may allege that the award rests on errors of fact
or on misrepresentation of the contract.’” Stark v. Sandberg, Phoenix & von Gontard, et
al., 381 F.3d 793, 798 (8th Cir. 2004) (internal citations omitted); see also Val-U Const.
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Co. of S.D. v. Rosebud Sioux Tribe, 146 F.3d 573, 578 (8th Cir. 1998). Indeed,
“arbitration awards should be construed, whenever possible, so as to uphold their
validity.” Delta Mine Holding Co. v. AFC Coal Properties, Inc., 280 F.3d 815, 823 (8th
Cir. 2001).
The FAA lists four narrow bases for vacating an arbitration award: (1) where the
award was procedure by corruption, fraud, or undue means; (2) where there was evident
partiality or corruption in the arbitrators; (3) where the arbitrators were guilty of
misconduct in refusing to postpone the hearing, upon sufficient cause shown, or in
refusing to hear evidence pertinent and material to the controversy, or of any other
misbehavior by which the rights of any party have been prejudiced; or (4) where the
arbitrators exceed their powers, or so imperfectly execute them, that a mutual, final, and
definite award upon the subject-matter was not made. 9 U.S.C. § 10(a). In addition to
these statutory grounds, the Eighth Circuit has recognized two “extremely narrow” nonstatutory bases for vacating an arbitration award: where the award is “completely
irrational” or where it “evidences a manifest disregard for the law” Hoffman v. Cargill,
Inc., 236 F.3d 458, 461-462 (8th Cir. 2001). In applying these bases, the Court is
cautioned “not to set aside an award simply because [it] might have interpreted the
agreement differently or because the arbitrators erred in interpreting the law or in
determining the facts.” Id. “Rather, the contract must not be susceptible of the arbitrator’s
interpretation.” Id.
2. The Arbitrator Did Not Exceed His Authority by Ignoring the Language of
the CBA and Plant Rules

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In its first point, plaintiff argues the arbitrator “impermissibly ignored the clear
and unambiguous terms of the collective bargaining agreement and [defendant’s] plant
rules” when his decision acted to extend Wright’s written warning to a period longer than
twelve months. Plaintiff cites Teamsters Local Union No. 688 v. Meridian Medical
Technologies, 2013 WL 171809 (E.D. Mo. Jan. 16, 2013) in support, which vacated an
arbitration award that “failed to draw its essence from the parties’ collective bargaining
agreement.” In Meridian Medical, the CBA at issue unambiguously required, prior to
discharge, that the employer “give at least one warning notice of the complaint against
such employee to the employee in writing” and also unambiguously provided “the
warning notice as herein provided shall not remain in effect for a period of more than
twelve (12) months from the date of said warning notice received.” Id. at *4. In a separate
set of administrative rules, the employer laid out a four-step policy of progressive
discipline that was silent as to time limits for completion. Id. The Court found the
arbitrator had erred when he concluded—without a basis in the language of either the
CBA or administrative rules—that the four-step discipline policy had to occur within the
same twelve-month period mentioned in the CBA. Id. at *4-5. The Court concluded “the
parties’ agreement simply does not allow for this interpretation” and, therefore, vacated
the arbitration award. Id. at *5.
Meridian Medical does not support plaintiff’s position, it harms it. Plaintiff
suggests defendant’s plant rules are “unambiguous” when they state that “warning
notices will remain in effect for twelve months.” But, such language is clearly lacking in
clarity when compared to the CBA in Meridian Medical, which stated “the warning
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notice as herein provided shall not remain in effect for a period of more than twelve (12)
months from the date of said warning notice received.” Id. at *4 (emphasis added).
Plaintiff would have this court read the italicized language into defendant’s plant rules.
Indeed, plaintiff reads these rules to mean that the twelve-month clock begins
immediately upon the issuance of a written warning. But, plaintiff provides no evidence
to support such a reading through, for example, the past practices of defendant who—
plaintiff could have been shown—discharged someone for cumulative written warnings
in the same time period of a pending grievance process, thereby indicating the grievance
process does not affect the running of the twelve-month clock.
As this Court sees it, there are at least three potential reading of the plant rules: as
plaintiff argues, a written notice is effective on the date it is received; in a hybrid
scenario, a written notice is effective on the date it is received but can only be acted upon
if upheld by an arbitrator; or, as defendant argues, a written notice takes effect only after
it is upheld by an arbitrator. Under the evidence presented, which lacks proof of the
underlying intent of the clause at issue, none of these interpretations seem more
conclusive than the others. That’s because, ultimately, the language is not “unambiguous”
as plaintiff urges; rather, the plant rules are silent as to the issue of the effective dates of
the twelve-month probationary period. There being nothing expressly stated on the issue,
it cannot be said that the arbitrator exceeded his authority by “ignoring” language that
simply does not exist.
3. The Arbitrator Did Not Exceed His Authority by Ruling on an Issue Outside
of the Agreed-Upon Issues Presented to Him

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Plaintiff next argues that vacatur is proper because the arbitrator “rul[ed] on an issue
of extending the time limit for written discipline under defendant’s plant rules and this
issue was never presented to the arbitrator at the hearing.” The issue submitted to the
arbitrator was “whether the [defendant’s] decision to suspend [Wright] for violating
[defendant’s] Plant Rule III-S, was for proper cause, and, if not, what shall be (sic) the
remedy be?” Foremost, as already explained, it is not clear that the arbitrator was
“extending” any time limit for written discipline. Moreover, implicit in the issue
presented to arbitration is the appropriateness or inappropriateness of a written warning
imposed in conjunction with the subject-matter of the arbitration—Wright’s suspension.
The clause “what shall [the] remedy be”—triggered by the arbitrator initially finding
Wright was not properly suspended—is broad enough to permit the arbitrator to fashion a
remedy that may include, for example, a written warning in lieu of suspension. See, e.g.,
Midwest Division-LSH, LLC. v. Nurses United for Improved Patient Care, 720 F.3d 648,
651 (8th Cir. 2013) (stating that “when the parties stipulated that the issues submitted to
an arbitrator included ‘what shall the remedy be,’ [a party] can hardly argue that the
arbitrator ‘acted outside his authority’ in fashioning a remedy, unless that remedy was
expressly prohibited by the [parties’ agreement]”). Indeed, arbitrators do not exceed the
scope of their arbitration submission so long as they “confine [themselves] to the areas
marked out for consideration” generally. See Int’l Ass’n of Machinists and Aerospace
Workers, AFL-CIO v. Northwest Airlines, Inc., 858 F.2d 427, 432-433 (8th Cir. 1988)
(arbitration panel did not exceed its authority by imposing penalty, despite arbitration
submission not requesting a penalty, where said penalty was necessary to ensure
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compliance of the issues submitted to arbitration). The facts presented here do not
indicate the arbitrator impermissibly travelled beyond the boundaries of the issues
submitted to him.
4. The Arbitrator’s Decision Does Not Amount to Double Jeopardy
For its third point, plaintiff argues the arbitrator’s “decision to extend the one-year
limit on written warnings for a single disciplinary event amounts to double jeopardy.”
Plaintiff appears to be invoking the doctrine of industrial double jeopardy, which only
one federal court has ever considered in detail. See Zayas v. Bacardi Corp., 524 F.3d 65
(1st Cir. 2008). In Zayas, it was noted that “the doctrine of industrial double jeopardy
enshrines the idea that an employee should not be penalized twice for the same
infraction.” Id. at 69. This “doctrine” is suspect, however, because the Double Jeopardy
Clause applies specifically to criminal penalties. See Hudson v. U.S., 522 U.S. 93, 98
(1997). The so-called penalty plaintiff appears concerned with under this “doctrine”—
even should it be considered—is the idea that Wright was vulnerable to the cumulative
warning effect under defendant’s disciplinary policies when his single warning served a
double duration. But, as was already explained, plaintiff speculates that Wright’s warning
served a double duration; it is defendant’s theory, as Wright’s employer, that the
grievance process forestalled the twelve-month clock applicable to cumulative warnings
and, therefore, plaintiff was not actually exposed to progressive discipline while the
grieving process was taking place. Plaintiff’s mere speculation is insufficient to support
the application of this doctrine.
III. CONCLUSION
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For these reasons,
IT IS HEREBY ORDERED that plaintiff’s motion for summary judgment (#27)
is DENIED.
IT IS FURTHER ORDERED that defendant’s motion for summary judgment
(#24) is GRANTED.
The arbitration award is hereby CONFIRMED.

So ordered this 26th day of October 2018.

STEPHEN N. LIMBAUGH, JR.
UNITED STATES DISTRICT JUDGE

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