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Malia v. RCA Corp.

argued: June 2, 1986.

SAM MALIA AND INGRID MALIA, APPELLANTS
v.
RCA CORPORATION (D.C. CIVIL NO. 85-0721)



ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF PENNSYLVANIA

Author: Gibbons

Before: GIBBONS, BECKER, and STAPLETON, Circuit Judges.

Opinion OF THE COURT

GIBBONS, Circuit Judge :

At issue on this appeal is whether section 301 of the Labor Management Relations Act of 1947 (LMRA), 29 U.S.C. § 185(a)(1982), preempts an employer's state-law claims for breach of an oral contract of employment, intentional infliction of emotional distress, fraudulent misrepresentation, and intentional interference with contract and also preempts a derivative action by the employee's wife for loss of consortium. The district court reasoned that the state law claims were dependent upon a collective bargaining agreement and therefore held that the claims were preempted by federal law. Although the court went on to construe the complaint as alleging claims under § 301 of the LMRA, it granted summary judgment in favor of the employer because the complaint as alleging claims under § 301 of the LMRA, it granted summary judgment in favor of the employer because the complaint was not filed within the applicable six-month statute of limitations. Because we conclude that the district court misconstrued the nature of the employee's state law claims, we reverse.

The appeal arises out of a labor dispute in which the plaintiff, Sam Malia, sought to be reinstated to a job within a collective bargaining unit after Malia had been promoted to a supervisory position.*fn1 Malia had worked as an hourly employee for the defendant, RCA Corporation, from 1966 until April 9, 1984. In connection with his job as an hourly employee, Malia had been a member of a bargaining unit represented by Local 178 of the International Union of Electrical, Radio and Machine Workers. In early April of 1984 Malia, in his capacity as president of Local 178, attended a dinner at which RCA's plant manager, Harlon May, offered to promote Malia to inventory coordinator, a managerial position outside the Local 178 bargaining unit. As an inducement to accepting the promotion, May promised Malia better pay, increased hours and overtime, advancement within the company, less stressful working conditions, and the option to return to the bargaining unit if Malia was not satisfied with the new position. See Malia's Complaint at P 6, reprinted in Joint Appendix at 4. Malia accepted RCA's offer and began to perform his job as inventory coordinator on April 9, 1984. In less than three weeks Malia requested that he be returned to his former position as soon as such a position became available. On April 28, 1984, such a position became available, but RCA's management did not accede to Malia's request for reassignment. As a result, he has remained in the position of inventory coordinator.

Whether a state law claim is preempted by federal law is a question of congressional intent. Malone v. White Motor Corp., 435 U.S. 497, 504, 55 L. Ed. 2d 443, 98 S. Ct. 1185 (1978). Section 301 of the LMRA provides a federal right of action for violations of contracts between an employer and a labor organization representing employees. 29 U.S.C. § 185(a) (1982).*fn2 This statutory provision reflects a congressional intent to ensure that federal common law is applied to the enforcement of collective bargaining agreements. Textile Workers Union v. Lincoln Mills, 353 U.S. 448, 456, 1 L. Ed. 2d 972, 77 S. Ct. 912 (1957). While Congress did not state to what extent it intended § 301 to preempt state law, See Allis-Chalmers Corp. v. Lueck, 471 U.S. 202, 105 S. Ct. 1904, 1910, 85 L. Ed. 2d 206 (1985), the Supreme Court has recently explained that

questions relating to what the parties to a labor agreement agreed, and what legal consequences were intended to flow from breaches of that agreement, must be resolved by reference to uniform federal law, whether such questions arise in the context of a suit for breach of contract or in a suit alleging liability in tort.

Id. at 1911. Thus, in Allis-Chalmers the Court held "that when resolution of a state-law claim is substantially dependent upon analysis of the terms of an agreement made between the parties in a labor contract, that claim must either be treated as a § 301 claim or dismissed as preempted by federal labor-contract law." Id. at 1916 (citation omitted). The focus of inquiry in determining § 301 preemption, therefore, is on the nature of the state-law claims because state-law claims that are independent of collective bargaining agreements are not preempted by § 301 of the LMRA. Id. at 1912. A logical corollary to the rule preempting state-law claims that depend on collective bargaining agreements is the rule that employees who are members of a collective bargaining unit cannot negotiate individual contracts that are inconsistent with the collective bargaining agreement. See J. I. Case Co. v. NLRB, 321 U.S. 332, 337-39, 88 L. Ed. 762, 64 S. Ct. 576 (1944); Eitmann v. New Orleans Public Service, Inc., 730 F.2d 359, 362 (5th Cir. 1984); see also NLRB v. Allis-Chalmers Manufacturing Co., 388 U.S. 175, 180, 18 L. Ed. 2d 1123, 87 S. Ct. 2001 (1967). "["National labor] policy . . . extinguishes the individual employee's power to order his own relations with his employer and creates a power vested in the chosen representative to act in the interests of all employees . . . . Thus only the union may contract the employee's terms and conditions of employment.")

In the case now under consideration the district court reasoned that Malia's state-law claims depended upon an interpretation of a provision of the Local 178 collective bargaining agreement which the court believed governed Malia's right to be reinstated to the bargaining unit. See Malia v. RCA Corp., No. 85-0721, slip op. at 6-7 (M.D. Pa. Oct. 17, 1985). The provision of the Local 178 contract that the district court was referring to provide in relevant part,

When an employee has established seniority privileges in an occupational classification within the Bargaining Unit and is or has been thereafter transferred or promoted to another position which is not within the Bargaining Unit, in the event such employee is again restored to a position within the Bargaining Unit, such employee shall be deemed to have retained but not accumulated seniority privileges within the Bargaining Unit in accordance with Article 56, provided that the privilege of returning to the Bargaining Unit shall be extended to all employees so affected.

Supplementary Local Agreement between RCA and Local 178 at P 56.04, reprinted in Joint Appendix at 58 (emphasis supplied). A careful reading of this paragraph reveals that the district court was mistaken. Paragraph 56.04 of the Local 178 collective bargaining agreement does not govern the right to be reinstated. Rather it governs the issue of seniority if an employee is reinstated to the bargaining unit.*fn3 In part the district court's misinterpretation can be explained by Malia's misleading reference to paragraph 56.04 in his Complaint. Malia's breach of contract claim alleges, "The Defendant by not reinstating the Plaintiff back into the Bargaining Unit at the Plaintiff's request when a position was available has breached Paragraph 56.04 of the Supplemental Local Agreement Between RCA Corporation and Local No. 178." Malia's Complaint at P 16, reprinted in Joint Appendix at 6. To the extent that this claim relies on the Local 178 collective bargaining agreement, the claim is preempted. However, Malia's Complaint also alleges facts that would support a claim for breach of an oral contract. See Malia's Complaint at PP 5, 6, and 7, reprinted in Joint Appendix at 4. This oral contract is a completely separate agreement from the collective bargaining agreement. In addition this oral contract is not preempted by the rule prohibiting members of a collective bargaining agreement. In addition this oral contract is not preempted by the rule prohibiting members of a collective bargaining unit from negotiating inconsistent individual contracts. Although Malia was a member of Local 178 when he negotiated the alleged oral contract, the oral contract relates to the job of inventory supervisor -- a management position outside the Local 178 bargaining unit. Nothing in the LMRA prevents an individual -- whether that individual is to be newly hired or promoted from a bargaining unit -- from negotiating an employment contract for a management position.*fn4 Nor does LMRA prevent an individual -- whether an applicant for new employment or a current employee in a supervisory position -- from negotiating for a job in a bargaining unit so long as that employment will be on the terms and conditions set forth in the collective bargaining agreement.

Thus, because we construe Malia's Complaint as alleging a state-law breach of contract claim based on an oral employment contract we conclude that that claim and Malia's state-law tort claims, which derive from the breach of the oral contract, are independent of and do not interfere with the Local 178 collective bargaining agreement. We, therefore, hold that the district court erred in concluding that Malia's state-law claims were preempted by § 301 of the LMRA. Given this conclusion, the district court's decision concerning the statute of limitations is irrelevant. The six-month statute of ...


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