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NF&M CORP. v. USW

February 28, 1975

NF&M Corporation, Plaintiff,
v.
United Steelworkers Of America et al., Defendants


Marsh, C.J.


The opinion of the court was delivered by: MARSH

MARSH, C.J.

 This is an action to set aside and vacate an arbitrator's award which, plaintiff employer contends, exceeded the arbitrator's authority under the collective bargaining agreement signed by the parties. The matter is now before us on a motion for summary judgment filed by the defendant unions.

 On March 6, 1974, the plaintiff suspended employee Mathew Catanese for gross neglect of working equipment, and on March 7, 1974, when Catanese appeared at the plant to question his suspension, he was discharged for insubordination. Defendant Local No. 8148, together with Catanese, initiated the first step of the labor contract's three-step grievance procedure on March 8, 1974, protesting both of these actions by the plaintiff. *fn1" Later that day, the defendant local union filed a written grievance (dated March 7, 1974) which read: "Mathew Catanese was suspended unjustly according to Article VII." Article VII is the contract provision relating to discharge which allows the employer to discharge an employee for "just cause." Plaintiff admits that this written grievance complied with all of the "second step" requirements set out in the contract, but argues that this was a written grievance only as to Catanese's suspension and that no written grievance was ever filed with respect to the discharge. The contract states that a second step written grievance is to be submitted within three working days of the conclusion of the first step procedure (Art. VI, para. 2). The contract further provides that the failure of any party to comply with the time limitations shall result in the automatic settlement of the grievance against the position of that party (Art. VI, para. 3). *fn2"

 When no agreement was reached at a March 22nd meeting between the parties, the defendant referred three issues to arbitration: (1) validity of the suspension; (2) timeliness of the discharge grievance; and (3) validity of the discharge. Plaintiff agreed to permit issues (2) and (3) to be submitted to the arbitrator even though it contended that the discharge grievance had been settled against the defendants by reason of Article VI, paragraph 3.

 On July 25, 1974, Arbitrator Harry Pollock held an evidentiary hearing at which both parties were given an opportunity to present testimony and to submit briefs. Subsequently, on August 7, 1974, the arbitrator issued the following award:

 
"1. The suspension was not for 'just cause '.
 
2. The grievance was timely.
 
3. The discharge was not for 'just cause '.
 
4. The grievant shall be reinstated with full seniority and shall be paid for all lost time, less any earnings in the interim and any unemployment compensation received."

 On August 15, 1974, plaintiff filed the present action to have this court set aside and vacate the arbitrator's award.

 The question of what role this court should take in reviewing the award of a labor arbitrator was answered by the United States Supreme Court in United Steelworkers of America v. Enterprise Wheel and Car Corp., 363 U.S. 593, 4 L. Ed. 2d 1424, 80 S. Ct. 1358 (1960). The proper approach, said the Court, is for the courts to refuse to review the merits of an arbitrator's award since the federal policy favoring the settlement of labor disputes through arbitration would be undermined if the courts had the final say on the merits of the award. The arbitrator's award is legitimate so long as it draws its essence from the collective bargaining agreement. 363 U.S. at 596-597. This standard was examined and applied in Ludwig Honold Mfg. Co. v. Fletcher, 405 F.2d 1123, 1128 (3rd Cir. 1969) where the Court of Appeals concluded:

 
". . . only where there is a manifest disregard of the agreement, totally unsupported by principles of contract construction and the law of the shop, ...

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