United States District Court, E.D. Pennsylvania
January 13, 2004.
COMMUNICATIONS WORKERS OF AMERICA, AFL-CIO, Plaintiff
VERIZON COMMUNICATIONS, INC. and VERIZON PENNSYLVANIA, INC., Defendants
The opinion of the court was delivered by: SAM JOYNER, Magistrate Judge
MEMORANDUM AND ORDER
Presently before the Court is the motion to dismiss of Defendants
Verizon Communications, Inc. and Verizon Pennsylvania, Inc. ("Verizon").
For the reasons that follow, the motion is granted.
The parties were previously before this Court pursuant to a Motion for
Preliminary Injunction and a Complaint filed by Plaintiff, Communications
Workers of America, AFL-CIO ("Union"), on December 5, 2002.
Communications Workers of America, AFL-CIO v. Verizon
Communications, Inc., et al. Civ. 02-8893 (J. Curtis Joyner). In
that action, Plaintiff sought to enjoin Verizon from enacting a
threatened lay off of hundreds of bargaining unit members in violation of
provisions contained in the parties' collective bargaining agreement
("CBA") and provisions set forth
in a merger agreement executed by the parties. After an injunction
hearing, this Court denied the Union's petition for injunctive relief and
encouraged the parties to proceed to arbitration.
Meanwhile, another case presenting nearly identical issues was being
heard by Arbitrator Shyam Das in New York. On July 10, 2003, Arbitrator
Das issued an Opinion and Award in the New York case announcing that
Verizon had violated the parties' CBA ("New York decision"). (Plf.'s
Complaint Ex. A). Under the New York decision, employees who were
involuntarily transferred were to be returned to their former work
locations and employees laid off were "to be returned to the payroll and
made otherwise whole." Id. at pages 57-58. On July 14, 2003,
Executive Director of Labor Relations for the Mid-Atlantic Region and
Verizon Chairperson Ronald H. Williams announced that the New York
decision would apply to the outstanding arbitration cases in New Jersey
and Pennsylvania. (Plf.'s Complaint Ex. B). By letter dated July 16,
2003, "All New England and Mid-Atlantic Laid Off Associates" were
notified that Verizon was offering reinstatement. (Plf.'s Complaint Ex.
C). The letter further stated that the laid off associates would be "made
whole" in accordance with the terms of the CBA under which the associates
Following this offer, Verizon petitioned this Court to
dismiss the pending matter as moot. On August 27, 2003, the Union
filed a Notice of Dismissal of the Pennsylvania case.
The Union brings the present action pursuant to section 301 of the
Labor Management Relations Act ("LMRA"), 29 U.S.C. § 185, to compel
Verizon's performance of its obligations set forth in the New York
decision, the parties' CBA, and the "additional agreements" between the
parties. Specifically, the Union alleges that Verizon has failed and
refused to remit back pay to laid off employees, to make laid off
employees whole for their health care expenses/losses/damages, and to
reverse transfers of laid off employees.
The question before the Court is whether the current dispute is subject
to the arbitration provisions of the parties' CBA.*fn1 For the reasons
that follow, we find that this dispute is subject to the arbitration
provisions and accordingly, dismiss the case.
In general, federal labor policy requires a party to a collective
bargaining agreement ("CBA") to first attempt use of the contract
grievance procedures agreed upon by the parties before proceeding to
litigation. See Republic Steel Corp. v.
Maddox, 379 U.S. 650, 652-53 (1965). The question of
whether a dispute is subject to a CBA's arbitration provisions is to be
decided by the court, unless the parties "clearly and unmistakably
provide otherwise." United Steelworkers v. Luckens Steel Co.,
969 F.2d 1468, 1473-74 (3d Cir. 1990) (quoting AT & T
Technologies, Inc. V. Communications Workers of America,
475 U.S. 643, 649 (1986)). Where a CBA contains an arbitration clause, a
presumption of arbitrability applies whereby a court should deny an order
to arbitrate only where "it may be said with positive assurance that the
arbitration clause is not susceptible of an interpretation that covers
the asserted dispute." Luckens, 969 F.2d at 1474 (quoting AT
& T, 475 U.S. at 650) (internal quotations omitted). Doubts are to be
resolved in favor of coverage. Id. In the context of settlement
agreements, this Circuit has held that "[s]ettlement agreements . . .
between parties to a collective bargaining agreement containing a broad
arbitration clause are arbitrable when the underlying disputes are
arbitrable, except when the parties expressly exclude the settlement
agreements from arbitration" or "[t]he party contesting the presumption
of arbitrability [produces] `strong and forcefull evidence of an
intention to exclude the matter from arbitration." Id. at 1475
(citing Niro v. Fearn Int'l, Inc., 827 F.2d 173, 175 (7th Cir.
In the present case, the Union argues that the "agreement to
apply the New York decision to the affected Pennsylvania employees
in exchange for suspension of the Gorman arbitration and dismissal of the
federal action was an agreement made by and between [the Union] and
Verizon that was entirely independent of any prior written agreements of
the parties," including the CBA. Plf.'s Memo, of Law at 10.
Under the principles set forth in Luckens, this argument is
unpersuasive. By the Union's own admission, the "settlement agreement"
ended the pending arbitration and the federal action. The underlying
dispute was clearly based on the parties' CBA and was arbitrable.
See Communications Workers of America, AFL-CIO v. Verizon
Communications, Inc., et al. Civ. 02-8893 (E.D.Pa. April 1, 2003)
(Document No. 22) (J. Curtis Joyner). Furthermore, Verizon's letter
offering to reinstate and "make whole" laid off employees specifically
refers to the CBA. The letter states that the "make whole" remedy is to
be calculated in accordance with the employees' CBA. The CBA clearly
governs the back pay and health benefits to which an employee is entitled
following a grievance settlement-the pay and benefits which the Union now
alleges Verizon has failed to remit. See Def.'s Ex. D. We
therefore fail to see how the "settlement agreement" can be "entirely
independent" of the parties' CBA.
The Union also argues that because it has not identified a specific
provision of the CBA that has been violated, the
arbitration provisions cannot apply. This argument stems from
language in the grievance and arbitration provisions that requires
"written notice specifying the Section of the Agreement alleged to be
violated." This language, however, should be examined in the context of
the entire provision, which reads:
[If at any time, a controversy should arise
between the Union and the Company regarding the
true intent]*fn2 and meaning of any provision of
this Agreement or regarding any claim that either
party has not performed a commitment of this
Agreement, the controversy may be presented for
review in accordance with the preceding Sections
of this Article. If the controversy is processed
under these Sections and is not satisfactorily
settled, the Union or the Company, by written
notice specifying the Section of the Agreement
alleged to be violated, may submit the question
under dispute to arbitration in accordance with
the provisions of Article 13 of this Agreement
. . . Grievances and controversies shall be
settled only in accordance with the procedures set
Def.'s Motion to Dismiss. Ex. E.
This Court cannot fathom how the Union can show that employees have not
received the benefits to which they are entitled by virtue of the
"settlement agreement" without reference to the provision of the CBA that
dictates what it means to be "made whole."
Applying the above principles, we find that because the original
dispute underlying the "settlement agreement" was
arbitrable and because the arbitration clause is sufficiently
broad, the current dispute regarding the parties' "settlement agreement"
is subject to the arbitration provisions of the parties' CBA. Plaintiff's
complaint is therefore dismissed.
An appropriate order follows.
AND NOW, this day of January, 2004, upon consideration of Defendants'
Motion to Dismiss (Document No. 6), and Plaintiff's response thereto
(Document No. 11), for the reasons stated in the accompanying Memorandum,
it is hereby ORDERED that Defendants' Motion is GRANTED.