Labor Law - Stephen W. Mooney and Leigh Lawson Reeves

• Publication year: 1995

Labor Lawby Stephen W. Mooney^* and Leigh Lawson Reeves^**

I. Introduction

This Article surveys the 1994 decisions of the United States Court of Appeals for the Eleventh Circuit that impacted on the areas of traditional labor law. This Article specifically addresses decisions by the Eleventh Circuit under the National Labor Relations Act ("NLRA"),¹ the Labor Management Relations Act ("LMRA"),² the Fair Labor Standards Act of 1938 ("FLSA"),³ the Occupational Safety and Hazard Act ("OSHA"),⁴ and the Employee Retirement Income Security Act of 1974 ("ERISA").⁵

Given the volume of cases decided by the Eleventh Circuit in the area of traditional labor law this past survey year, this Article does not address every case. It does attempt, however, to address the noteworthy decisions issued by the Eleventh Circuit in 1994. As in years past, this survey year the Eleventh Circuit considered several cases covering a wide variety of issues. The majority of cases revisited old rules and attempted to clarify their use through the facts presently before the court. Some cases, however, addressed new issues and broke new ground in the area of traditional labor law.

II. The National Labor Relations Act and the Labor Management Relations Act

A. Judicial Review of Arbitration Awards

As in the years past, the Eleventh Circuit again addressed the standard for judicial review of an arbitration award. In Interstate Brands Corp. v. Local 441 Retail, Wholesale & Department Store Union AFL-CIO,⁶ the court of appeals reiterated the long-standing policy that although the court generally gave a great deal of deference to an arbitrator's award, when the award did not "draw its essence from the [labor] contract," then the reviewing court need not defer to the arbitrator's conclusions.⁷ In this particular case, the employer, Merita Bakery, employed several truck drivers to deliver bakery goods throughout the Southeast. These drivers were represented by a local union. In May 1993, a driver named Willard Hamrick was informed by his supervisor that he was due for a physical examination, which also included the Department of Transportation ("DOT") mandated drug testing. This testing was subsequently performed and Mr. Hamrick tested positive for illegal drugs. Consequently, he was terminated from his position.⁸

Shortly thereafter, pursuant to the labor contract, Mr. Hamrick requested that his termination be reviewed by an arbitrator which would then be binding on all parties. The arbitrator framed the issue to be determined as "whether the urine test . . . [met] the criteria of the [DOT's] standards and, if so, whether the penalty of discharge [was] appropriate under the company drug policy."⁹ The arbitrator did not find fault with the collection site or the laboratory procedures but, instead, held that the DOT Regulation 40.25(c) required a chain of custody in the handling of the specimen and that there was a break in the chain in this case (i.e. couriers of specimen between collection site and laboratory did not sign the shipping box). Based upon this break in chain of custody, the specimen could not be considered in his analysis of whether or not Mr. Hamrick's termination was proper; thus, he excluded it from the arbitration and ordered Mr. Hamrick to be reinstated.¹⁰

The employer, Merita Bakery, then brought suit against the union challenging the arbitration award.¹¹ The district court granted summary judgment to the union and upheld the arbitration award in its entirety. Merita then appealed the award to the Eleventh Circuit.¹²

On appeal, the Eleventh Circuit noted that although their review of arbitration awards was generally very limited, this did not mean that they were bound by each and every arbitration award that was issued.¹³ The court reiterated the long-standing principle that they would not consider the merits of an award if it was argued that the award rested on errors of fact or on a misinterpretation of the contract.¹⁴ When the award, however, [did] not "draw its essence from the contract, but rather reflect [ed] the arbitrator's 'own brand of industrial justice,' the [Eleventh Circuit held that the] reviewing court need not defer to the arbitrator's conclusions."¹⁵

The Eleventh Circuit then went on to find that the arbitrator in this case went beyond the collective bargaining agreement when he attempted to interpret the actual DOT regulations requiring a "chain of custody" for the specimen.¹⁶ Since the arbitrator's analysis was confined to the DOT regulations and his interpretation of them, rather than his interpretation of the actual contract between the union and the employer, the court was not bound by his findings of fact. Thus, the issue became whether or not the arbitrator was correct when he found that section 40.25(k) required such a stringent chain of custody requirement and, specifically, whether it required the signature of each and every individual who handled the sealed shipping box between the collection site and the testing laboratory.¹⁷

In reviewing the DOT regulations concerning chain of custody requirements, the court paid special attention to the interpretation of the regulations shared by the DOT.¹⁸ The DOT contended they had never interpreted their regulations to require couriers, postal employees, or other intervening personnel involved in the transportation of urine specimens, to make specific chain of custody entries.¹⁹ The court of appeals pronounced the general rule that "[a court] owe[d] substantial deference to an agency's interpretation of its own regulation."²⁰ Since the DOT's construction of its custody and control regulation was reasonable, the Eleventh Circuit found that such stringent chain of custody procedures, as ruled upon by the arbitrator, did not have to be followed as was ruled upon by the arbitrator.²¹ Thus, the court of appeals held that the specimen was incorrectly excluded from the arbitrator's consideration; therefore, they reversed the district court's grant of summary judgment and remanded the case for further proceedings.²²

B. Exhaustion of Contract Remedies as a Requirement for Bringing Breach of Contract Suit

In Thomas v. Kroger Co.,²³ a discharged employee brought an action against her employer alleging that she was terminated on the basis of her race in violation of her collective bargaining agreement and Title VII of the Civil Rights Act of 1964, 42 U.S.C. Sec. 2000e-2.²⁴ The employer filed a motion for summary judgment arguing, among other things, that the plaintiff had failed to exhaust the contract remedies outlined in her collective bargaining agreement; thus, she had not met the prerequisites needed to bring a breach of contract claim in federal court.²⁵ The district court agreed with the employer and dismissed the plaintiff's breach of contract claim. The plaintiff then filed an appeal to the Eleventh Circuit.²⁶

The Eleventh Circuit reiterated the earlier United States Supreme Court holding that "federal labor policy requires that individual employees wishing to assert contract grievances must [initially] attempt use of the contract grievance procedure agreed upon by the employer and union as a means of redress."²⁷ Thus, the analysis became whether or not the plaintiff had exhausted the grievance procedures outlined in her union contract; if not, her claim would necessarily be dismissed.²⁸

The facts in this case demonstrated that the plaintiff was a member of the United Food and Commercial Workers Local 1063 Union and was covered by its collective bargaining agreement with the employer. This contract provided for a four step procedure for dispute resolution; and, if the parties agreed, they could skip the intermediary steps in favor of an immediate "step three" conference. If those conferences failed, the matter would then be referred to arbitration.²⁹

After the plaintiff's termination, she did file a grievance with the union to initiate the dispute resolution process. A "step three" meeting was scheduled between the union, the plaintiff, and the company's representative. The plaintiff was informed of this meeting, and she explained that she wished to have her lawyer present. The union representative told her that she could not bring her lawyer to the "step three" meeting, and on the night the meeting occurred, the plaintiff failed to attend. The meeting went forward in the plaintiff's absence, and she later received a letter from her employer stating that the investigation of her discharge was complete and that the termination decision was final.³⁰

Based on these facts, the Eleventh Circuit found that since the plaintiff was aware of the meeting and she simply failed to attend, she had not exhausted her contractual remedies.³¹ The fact that the plaintiff had wanted her lawyer to attend this meeting was not a relevant factor since the contract between the union and the employer did not allow for the attendance of lawyers at such meetings. Since the plaintiff had failed to exhaust her contractual remedies, the Eleventh Circuit affirmed the district court's order granting summary judgment to the employer.³²

C. Successorship Doctrine

This past survey year, the Eleventh Circuit addressed the successor-ship doctrine in detail and further delineated the reasoning behind the doctrine and what parties, if any, were subject to the doctrine. In Road Sprinkler Fitters Local Union No. 669 v. Independent Sprinkler Corp. ,³³ the union commenced an action requiring arbitration against a union employer and a nonunion employer that signed a settlement agreement stating they would participate in arbitration.³⁴ The union also, however, commenced an action requiring an alleged "successor" nonunion employer to comply with arbitration that had not signed the agreement. The district court granted summary judgment in favor of the union and required all three employers to arbitrate the issues currently in dispute. The alleged "successor" employer appealed to the Eleventh Circuit.³⁵

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