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Halstead & Mitchell Co. v. United Steelworkers of America

decided: December 1, 1969.

HALSTEAD & MITCHELL CO. ET AL., APPELLEES
v.
UNITED STEELWORKERS OF AMERICA ET AL., APPELLANTS



Kalodner, Ganey and Van Dusen, Circuit Judges. Kalodner, C. J. dissenting.

Author: Ganey

GANEY, C. J.:

This cause of action was begun in the Court of Common Pleas of Butler County, Pennsylvania, by the appellees herein against the appellants in the nature of a petition for declaratory judgment. The appellants thereafter removed the cause of action to the Federal District Court for the Western District of Pennsylvania. The petition for declaratory judgment sought a court ruling on whether or not a dispute between the Company and the Union was arbitrable. The appellants filed an answer and, after a pretrial conference, a stipulation was entered into between the parties and the matter was then left to the court to dispose thereof by way of summary judgment. The court made two rulings, (1) denying defendants' motion for summary judgment, and (2) granting plaintiffs' petition for declaratory judgment.

The facts upon which this appeal is based are as follows: The Company reduced its work force in Departmental Units "B" and "C" of the appellee's plant, and this reduction was brought about by the Company's elimination of the third shift, the 11:00 p. m. to 7:00 a. m. stint, for a period of three work weeks or fifteen work days. Since the employees were working on a rotating or swing shift basis, several employees lost five days of work. The reduction in force was made without regard to the seniority of the employees affected. A stipulation agreed to by the parties, paragraph 6, provided as follows: "That if the reduction in work force had been done as the defendants maintained it should have been done, of these 192 employees, 85 would have lost 15 days' work and 107 would have lost no work."

The Union referred this matter of seniority to the Grievance Procedure set forth in the contract.*fn1 When a satisfactory adjustment was not reached by the parties after the appellant had completed the steps required under the Grievance Procedure of the Agreement, the Union sought to submit the dispute to an impartial arbitrator. The Company refused to join in this request on the ground that the dispute was in the area of the arbitration exclusion clause of the Agreement and so the Company would not agree to leave the issue of arbitrability to an arbitrator. We, therefore, as did the district court, turn to the pertinent provisions of the Agreement in effect during the period of the layoffs.

Section 1 of Article III, entitled Management Rights, in pertinent part, provides:

"Except to the extent expressly abridged by a specific provision of this Agreement, the Company reserves and retains, solely and exclusively, all of its Common Law rights to manage the business. The sole and exclusive rights of management which are not abridged by this Agreement shall include, but are not limited to, its right to determine the existence of facts which are the basis of a management decision; to determine . . . volume of production . . . to discontinue processes or operations or to discontinue their performance by employees of the Company; to determine the number of hours per day or per week operations shall be carried on; to select and to determine the number and types of employees required; to assign work to such employees in accordance with the requirements determined by management; to establish and change work schedules and assignments; . . . to lay-off, terminate or otherwise relieve employees from duty for lack of work or other legitimate reasons, to determine the fact of lack of work . . . and otherwise to take measures as management may determine to be necessary for the orderly, efficient and profitable operation of its business -- all to the best regard of its employees."

Article XI, Section 2, regarding Seniority Rights, provides as follows:

"In cases of layoff, reduction in forces, promotions, transfers and recall . . . the Company shall give due consideration to the seniority and the individual qualifications of the employee to perform the work in question and the efficient operation of the Plant."

Later, Article XI, Section 6(c) states:

"(c) Department unit seniority shall be considered in case of temporary layoffs and subsequent recall within a unit. However, if for any reason there is work fluctuation or equipment down time within a section or a departmental unit, necessitating a reduction in work force for a short period of time, not to exceed 15 work days, the Company shall have the right to layoff or make work assignments as are expedient without regard to seniority. If at the end of the period the work interruption continues, the employees will be reassigned based on their qualifications and departmental unit seniority."

The district court, taking into consideration the pleadings and the pretrial conference reports of the parties, as well as the stipulation and the pertinent provisions of the contract, as indicated, held that summary judgment should be denied and the plaintiffs' petition for declaratory judgment should be granted.

It is readily apparent, in reading Article XI, Section 6(c), which points out, "However, if for any reason there is work fluctuation or equipment down time within a section or a departmental unit, necessitating a reduction in work force . . .", that the salient feature thereof is the reduction in the work force and not the name of the motivating reason, be it work fluctuation or equipment down time, as the latter words are merely illuminative of the cause of the reduction of the work force which is the essential factor prompting the bringing into play the seniority rule. It is the latter, and not the fluctuation or equipment down time, which is the core and essence of the provision. Without a reduction in force here, there would be no necessity for the application of the seniority rule, for to quibble over a minute delineation between the connotation of work fluctuation and a reduction in work force, if any there be, is mischievous word play, an indulgence in semantics, since a work fluctuation must, of necessity, be inherent in a work stoppage or reduction in force. While we are not insensitive to the progressive relationship fostered by the courts between Labor and Management,*fn2 we must, nevertheless, accede to the agreement reached by the parties usually after long hours of debate and a procedure hammering out an agreement with a give-and-take by both parties. Here, in our judgment, the language used in the Agreement is clear, precise and unambiguous, as set out heretofore, and especially the granting to management of the right to determine the facts necessitating any reduction in force, reciting them Indian fashion and with specificity. In the same vein Article XI, Section 6(c) abridges the seniority rights set forth in the earlier Section 2, carving out plainly the rights reserved to management arising out of a temporary reduction in force.

In addition, we must examine the concessions made by counsel for the Union and, as here recited, show that repeatedly at the pretrial hearing Counsel for the Union agreed that there were no factual matters to be resolved,*fn3 and he cannot now be heard to complain because the court has ruled against the defendant. ...


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