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Extendicare Health Services, Inc. v. District 1199p

October 17, 2006


The opinion of the court was delivered by: Judge Sylvia H. Rambo


This action is to determine the enforceability of an arbitration award reinstating an employee to her position in a personal care home. The personal care home argues that her reinstatement is contrary to public policy, and requests that this court enter summary judgment vacating or modifying the award. The union representing the employee maintains that her reinstatement is not contrary to public policy and therefore must be enforced by this court. Guided by the Supreme Court's decision in Eastern Associated Coal Corp. v. United Mine Workers, Dist. 17, 531 U.S. 57 (2000), this court agrees with the union and will enter summary judgment in its favor.

I. Background

A. Facts

Tracey Poth was hired by Glenshire Woods Personal Care Home ("Glenshire Woods"), operated by Plaintiff Extendicare Health Services, Inc., on or about May 16, 1998. (Arbitrator's Award ["Award"] 11.) She was employed as a Medication Aide at Glenshire Woods from that date until she was fired on July 2, 2004. (Id.)

Ms. Poth was fired because the management of Glenshire Woods discovered that her criminal history included four misdemeanor convictions, dated October 18, 1990, for receiving stolen property. (Id. at 25.) The facility administrator determined that the misdemeanor convictions constituted "barrier offenses" under the Older Adult Protective Services Act, 35 Pa. Cons. Stat. Ann §§ 10225.101-10225.5102 ("OAPSA"). The administrator read the statute to mean that a personal care home, such as Glenshire Woods, is prohibited from continuing to employ an individual convicted of such barrier offenses. (Award 25.) Additionally, Ms. Poth's record showed a number of additional convictions for DUI-related offenses (Joint Appendix ["J.A."] Ex. J), none of which are barrier offenses under OAPSA. As a result, on July 2, 2004, Ms. Poth was fired. (Award 27.)

Ms. Poth filed a grievance with her union, Defendant District 1199P, Service Employees International Union AFL-CIO, CLC ("Union"). The Union and Glenshire Woods are bound by a collective bargaining agreement ("CBA") that governs the terms and conditions of facility employment practices. (CBA Art. 1.) The CBA states that "no employee shall be dismissed . . . without just cause." (Id. Art. 14.1.) The term "just cause" is not defined in the agreement.

The Union and Glenshire Woods disagreed over whether Ms. Poth's termination was based on "just cause." They resorted to arbitration, as required by the CBA. (Id. Art. 16.2.) The arbitrator was charged to decide whether Glenshire Woods had "just cause" to terminate Ms. Poth because her criminal history made her dismissal mandatory under OAPSA. (Award 29.) Other facts before the arbitrator were Ms. Poth's DUI-related convictions during her employment at Glenshire Woods. (Award 13.) The Joint Appendix filed with this court also shows a number of reports of her disciplinary infractions while employed (J.A. Ex. N) and a collection of employee awards and commendations that she earned at Glenshire Woods (J.A. Ex. T).

The arbitrator found that Ms. Poth's termination was neither mandatory nor the result of "just cause." (Id. at 30.) He determined that, in Nixon v. Commonwealth, 839 A.2d 277 (Pa. 2003), the Pennsylvania Supreme Court had declared unconstitutional the criminal records chapter of OAPSA, as it applied to "employees similarly situated to [Ms. Poth]." (Award 29-30.) He found that the Pennsylvania Department of Aging ("PDA") promulgated "new rules" after Nixon that do not prohibit someone with Ms. Poth's criminal history from being employed by a personal care home. (Id. at 30.) Because Glenshire Woods was not required by law to discharge Ms. Poth and her termination was not supported by just cause (id.), the arbitrator ordered her reinstated to her position as Medication Aide retroactively to July 2, 2004, with all lost salary, benefits, and seniority owed her from that date (id. at 34-35).

B. Procedural History

The arbitral award was entered on December 1, 2005. On December 28, 2005, Glenshire Woods filed the instant suit, requesting that this court modify or vacate the award. (Doc. 1.) The parties agreed that the matter be determined upon motions for summary judgment. (Doc. 7.) The Union filed its motion for summary judgment (Doc. 16) and supporting brief (Doc. 17) on May 11, 2006. Glenshire Woods filed its motion for summary judgment (Doc. 20) and supporting brief (Doc. 21) on the same date. After both sides filed briefs in opposition (Docs. 24, 25) and reply briefs (Docs. 26, 27), the matter is ripe for disposition.

II. Legal Standard

A. Summary Judgment

The familiar standard of Federal Rule of Civil Procedure 56(c) provides that summary judgment shall be granted when "there is no genuine issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law." Fed. R. Civ. P. 56(c). The standard remains the same when parties file cross-motions for summary judgment. Pa. Fed'n of Sportsmans Clubs v. Norton, 413 F. Supp. 2d 358, 365 (M.D. Pa. 2004). The court must construe each motion separately, however, viewing the evidence presented in the light most favorable to the non-moving party. Id. When the parties agree on the facts presented to the court, the court may accept them as true and not in dispute for purposes of summary judgment. Baer v. Chase, 392 F.2d 609, 615 (3d Cir. 2004).

Here, the parties do not dispute the facts of this case. They submitted to the court a joint appendix of exhibits that comprise the entire factual record. The parties recognize that their arguments are solely arguments of law and have agreed to dispose of the case on summary judgment. (Doc. 7.) Thus, summary judgment by the court is proper.

B. Judicial Review of an Arbitral Award

1. Generally

Judicial review of a labor arbitrator's decision, when entered pursuant to a collective bargaining agreement, is exceedingly narrow. Nat'l Ass'n of Letter Carriers v. U.S. Postal Serv., 272 F.3d 182, 185 (3d Cir. 2001). If the arbitrator is unbiased, honest, and acts within the scope of the authority granted him, a reviewing court may set aside an arbitral award only in rare cases. E. Associated Coal Corp., 531 U.S. at 62. The award must be closely derived from the collective bargaining agreement itself, not from the arbitrator's "own notions of industrial justice." Id. at 62 (quoting United Paperworkers Int'l Union v. Misco, Inc., 484 U.S. 29, 38 (1987)). If these requirements are met, the reviewing court may not vacate an award even if the court "is convinced [the arbitrator] committed serious error." Misco, Inc.,484 U.S. at 38-39 (allegations of "improvident, even silly, factfinding" insufficient to overturn award); Nat'l Ass'n of Letter Carriers, 272 F.3d at 185 (the test of a valid arbitration award is "singularly undemanding") (quotation omitted).

Limited judicial review of arbitration awards is proper because such awards are part of the "continuous collective bargaining process" between a union and an employer. United Steelworkers v. Enter. Wheel & Car Corp., 363 U.S. 593, 596 (1960). When a union and an employer contract to be bound by an arbitrator's decision in the event of a dispute about the interpretation of the agreement, the arbitrator's findings of fact and conclusions of law must be treated as if they represent "an agreement between [the employer] and the union as to the proper meaning of the contract's words." E. Associated Coal Corp., 531 U.S. at 62; accord Misco Inc., 484 U.S. at 37-38; Enter. Wheel & Car Corp., 363 U.S. at 599. A party "should not be deprived of the arbitrator's judgment, when it was his judgment and all that it connotes that was bargained for." Misco, Inc., 484 U.S. at 37.

As with all contracts, however, a reviewing court may not enforce an award that renders the collective bargaining agreement unenforceable as contrary to public policy. E. Associated Coal Corp., 531 U.S. at 62; W.R. Grace & Co. v. Local Union 759, Int'l Union of the United Rubber, Cork, Linoleum, & Plastic Workers, 461 U.S. 757, 766 (1983). The reviewing court must determine whether the award itself "run[s] contrary to an explicit, well-defined, and dominant public policy, as ascertained by reference to positive law and not from general considerations of supposed public interests." E. Associated Coal Corp., 531 U.S. at 63; accord W.R. Grace & Co., 461 U.S. at 766.

"Positive law" includes existing statutes, legal precedent, Misco, Inc., 484 U.S. at 44, and agency regulations, E. Associated Coal Corp., 531 U.S. at 63. It does not encompass mere common sense, assumption, or speculation.*fn1 Misco, Inc., 484 U.S. 29, 44 (1987). The statutes, precedent, and regulations considered must state with specificity the public policy to be enforced. See W.R. Grace & Co., 461 U.S. at 766. The court, not the arbitrator, is the final authority on the question of public policy. Id. Accordingly, the court may examine the arbitrator's findings of fact and conclusions of law if either are implicated in the public policy analysis. See id.; E. Associated Coal Corp., 531 U.S. at 62.

2. Awards for Reinstatement

When examining an award of reinstatement, the court "must assume that the collective-bargaining agreement itself calls for [the employee's] reinstatement." Id. at 61. Thus, the party seeking to vacate the award must show that the reinstatement itself would contravene public policy, as ascertained by reference to a specific provision of positive law. Id. 62-63, 66; Mercy Hosp., Inc. v. Mass. Nurses Ass'n, 429 F.3d 338, 343 (1st Cir. 2005); see Stead Motors v. Automotive Machinists Lodge No. 1173, 886 F.2d 1200, 1216-17 (9th Cir. 1989). If reinstatement is not prohibited by statute, precedent, or regulations, the award must be enforced. E. Associated Coal Corp., 531 U.S. at 66.

A broadly-worded statute stating general goals for a profession is not sufficient to bar an employee's reinstatement when awarded by an arbitrator. Boston Med. Ctr., 260 F.3d at 23; see id. at 25 (statutes and case law in favor of competent nursing care did not establish a public policy prohibiting the reinstatement of a nurse who committed one act of negligence in her ten-year employment history); Pan Am. Airways Corp. v. Air Line Pilots Ass'n, 206 F. Supp. 2d 12, 23 (D.D.C. 2002) (statute requiring "safe and adequate interstate air transportation" was too general to prohibit the reinstatement of a pilot). Though "reasonable people can differ" on the wisdom of an award reinstating a particular employee, as long as it is not prohibited by law, the award must stand. E. Associated Coal Corp., 531 U.S. ...

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