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Dauphin Precision Tool, LLC v. United Steel Workers of America


March 26, 2008


The opinion of the court was delivered by: Christopher C. Conner United States District Judge

(Judge Conner)


Presently before the court is the challenge of plaintiff Dauphin Precision Tool, LLC ("Dauphin Precision") to an arbitration award in favor of defendant union United Steel Workers ("the USW"), which represents its employees. Dauphin Precision seeks to set aside the award because it is allegedly contrary to the collective bargaining agreement between the parties and because of arbitral bias in favor of the union. The USW contends that neither argument warrants vacatur of the award. The parties have filed cross-motions for summary judgment. For the reasons that follow, Dauphin Precision's motion (Doc. 16) will be denied, and the USW's motion (Doc. 20) will be granted.

I. Factual Background*fn1

On May 10, 2006, Dauphin Precision discharged Timothy Tschopp ("Tschopp"), an employee of nineteen years and member of the USW, for repeated unexcused absence from work. (Doc. 29 ¶ 8; Doc. 34 ¶ 8.)*fn2 Dauphin Precision and the USW dispute the legitimacy of this discharge under the terms of the collective bargaining agreement ("CBA") then in effect between the parties.

A. The Collective Bargaining Agreement

Dauphin Precision and USW entered the CBA controlling this dispute on November 15, 2005. (Doc. 1, Ex. A at 1.) The agreement, which has a term of one year, includes an absenteeism policy outlining progressive sanctions for employees as they accumulate absentee hours. (See id. & app. D.IV.) The policy provides that an employee will receive verbal counseling after twenty-four absentee hours and written counseling after thirty-two hours and forty hours of absence respectively.

(Id.) Employees accumulating more forty absentee hours are subject to discharge.*fn3

(Id.) The policy does not define "absentee hours" but exempts military service, jury duty, approved union activity, and absences under the Family Medical Leave Act ("FMLA"). (Id.) In addition, the policy does not state whether vacation hours qualify as "absentee hours" within the ambit of the progressive discipline provisions. A substantively identical absentee policy was in effect during the previous contract year, which commenced November 16, 2004. (Doc. 19 at 45-46.)*fn4

The CBA contains separate provisions governing vacation, leaves of absence, and discharge. It authorizes employees to substitute one day of vacation pay for one day of illness, provided that the employee informs the company on the day of absence. (Doc. 1, Ex. A § XVII.3.) The contract also authorizes the company to control allotment of employees' vacation periods to ensure that the company is able to maintain adequate staffing for essential positions on all shifts. (Id. § XVII.3.) The CBA's seniority terms provide that employees will lose their seniority and employment upon "discharge[] for just cause." (Doc. 1, Ex. A § XVIII.7.b.)

B. Tschopp's Absences

Beginning in the spring of 2004, Tschopp commenced an annual pattern of expending all his vacation days within approximately three months of receiving them. (Doc. 19 at 47-49.) According to Dauphin Precision's time records, Tschopp was absent from work on twenty-two days between mid-March and mid-June of 2004. (Doc. 1, Ex. B at 7; Doc. 19 at 47.) Nine days were vacation taken with proper notice (hereinafter "proper vacation days"). For ten of the twenty-two days, Tschopp did not provide notice but had unused vacation time to cover the absences (hereinafter "improper vacation days"). For the remaining three days, he provided no notice and lacked vacation time to cover the absences. (hereinafter "unexcused absences"). (Doc. 1, Ex. B at 7; Doc. 19 at 47.) Tschopp behaved in a similar manner in spring 2005, with twenty days of absence in March and April. (Doc. 1, Ex. B at 7; Doc. 19 at 48.) Five of these were proper vacation days; fifteen were improper vacation days. (Doc. 1, Ex. B at 7; Doc. 19 at 48.) The pattern continued in spring 2006, when Tschopp was absent twenty-eight days in March, April, and May. (Doc. 1, Ex. B at 8; Doc. 19 at 49.) Six absences were proper vacation days. (Doc. 1, Ex. B at 8; Doc. 19 at 49.) Sixteen were improper vacation days, and six were unexcused absences. (Doc. 1, Ex. B at 8; Doc. 19 at 49.) Dauphin Precision discharged Tschopp on May 10, 2006, avowedly because the six unexcused absences translated into forty-four absentee hours under the absenteeism policy, which prescribed termination. (Doc. 1, Ex. B at 8; Doc. 19 at 68.)

The USW acknowledges that these absences occurred but contends that many of them were associated with Tschopp's diagnosis of polycythemia, a condition causing an abnormal increase in the number of red blood cells circulating in the blood stream.*fn5 (Doc. 1, Ex. B at 11). Tschopp had applied for and received FMLA leave for his condition in spring 2005, and he had also submitted statements of his physicians describing his medical problems to the company during early 2006.

(Doc. 1, Ex. B at 9; Doc. 29 ¶ 10; Doc. 34, ¶ 10.) He began the process of reapplying for FMLA leave during the spring of that year, and he had planned to submit the requisite paperwork after a May 25, 2006 appointment with his treating physician. (Id. at 11-12.) His May 10, 2006 discharge preempted those plans.

C. The Dispute and Arbitration Proceeding

The USW instituted a grievance on behalf of Tschopp, claiming that Dauphin Precision discharged him in violation of the CBA. (Doc. 29 ¶ 12; Doc. 32 ¶ 12.) Internal conciliation attempts under the CBA's grievance procedures proved unsuccessful, and the parties submitted the grievance to arbitrator Patrick McFadden ("Arbitrator McFadden" or "McFadden") on October 24, 2006. (Doc. 19 at 36.) William Coyle, Jr. ("Coyle"), the president of Dauphin Precision, represented the company at the hearing. (Doc. 1, Ex. B at 1.) The USW was represented by its subdistrict director assigned to the geographic area where Dauphin Precision is located. (Id.; see also Doc. 21, Ex. B ¶ 1.)

The parties' accounts of the arbitration hearing vary significantly.*fn6

According to Arbitrator McFadden and the USW, Coyle was unfamiliar with arbitration procedure and challenged McFadden's authority. (Doc. 21, Ex. B ¶ 6.) Coyle initially protested procedural rules, which dictate that the company present its case first in termination disputes. (Doc. 21, Ex. B ¶ 6.) Coyle also refused to enter the CBA or grievance documents as joint exhibits. (Doc. 19 at 17; Doc. 21, Ex. B ¶ 6.) Arbitrator McFadden described Coyle's conduct at the beginning of the hearing as "extremely aggressive" to an extent that impaired McFadden's "ability to control [the] proceeding." (Doc. 19 at 20-21.) The union representative recalls Coyle telling Arbitrator McFadden: "You're not telling me what to do." (Doc. 21, Ex. B ¶ 6.) As the arbitration progressed, McFadden explained procedural and evidentiary rules to Coyle on several occasions,*fn7 and Coyle was behaving cordially by the end of the proceeding. (Doc. 19 at 17-26; Doc. 21, Ex. B at ¶ 7.)

Dauphin Precision acknowledges that Coyle received procedural assistance from Arbitrator McFadden but denies that he engaged in an aggressive manner. (Doc. 33-2 ¶¶ 14, 16, 18.) It also denies that Coyle told Arbitrator McFadden that the McFadden lacked authority over him. (Id. ¶ 12.) To the contrary, Coyle recalls McFadden startling him early in the proceedings by stating: "Now I know what kind of employer you are." (Id. ¶ 5.) Coyle asked McFadden to recuse himself after making this statement, a request that the union opposed and Arbitrator McFadden denied. (Id. ¶¶ 8-10.) Dauphin Precision contends that this statement demonstrates that Arbitrator McFadden was biased in favor of the USW. (Id. ¶ 8.) Neither Dauphin Precision nor Coyle explain what prompted McFadden's statement other than alleged bias in favor of the USW.

Arbitrator McFadden recalled making a statement substantially similar to that alleged by Dauphin Precision, but he explained that it was an intentional response to Coyle's disruptive conduct and a measured attempt to regain control of the proceeding. (Doc. 19 at 24-25.) McFadden testified that his strategy proved successful and that, thereafter, he was able to direct the remainder of the arbitration. (Doc. 19 at 25, Doc. 21, Ex. B ¶ 7.)

D. The Arbitrator's Decision

Arbitrator McFadden issued his decision on October 27, 2006. He interpreted the just-cause provision of the CBA in conjunction with the absenteeism policy and concluded that any termination-under the absenteeism policy or otherwise- required just cause. (Doc. 1, Ex. B at 10, 13.) Hence, when Dauphin Precision discharged Tschopp, it was required to comply with both the absenteeism policy and the CBA's just-cause requirement.

McFadden examined Tschopp's attendance records and determined that he had exceeded his allotted absenteeism hours during 2004, 2005, and 2006, rendering him amenable to discharge during each successive year. (Id. at 11-13.) Further, the arbitrator determined that Dauphin Precision was aware of Tschopp's health problems during his 2006 absences. (Id. at 12.) Thus, McFadden concluded that the company discharged Tschopp despite waiving its termination rights during the two preceding years and despite having knowledge that he was suffering from a long-term illness. (Id. at 12-13.)

Arbitrator McFadden concluded that discharge under these circumstances violated the CBA's just-cause requirement because Dauphin Precision's failure to discharge Tschopp in 2004 and 2005 created an expectation that it would not require strict adherence to its absenteeism policy:

If the company didn't miss [Tschopp] in 2004 or 2005 for [abuse of the absenteeism policy,] he had no reason to expect or believe he would be subject to dismissal [in 2006] for similar action and conduct. In the event a company has control regarding a policy or standard and fails to enforce it uniformly over the course of time, It [sic] may not than [sic] one day decide to arbitrarily and unilaterally begin to now apply and enforce such standards with out [sic] first providing appropriate notice and warning to all employees affected of their [sic] intent.

Here we must find for the reasons indicated above, the discipline imposed by the company upon [Tschopp] was therefore without just cause. (Id. at 12-13.) Under the sanctions of the absenteeism policy, which progress directly from written warnings to discharge without intermediate suspension, Arbitrator McFadden found that he was limited to either upholding Tschopp's dismissal or ordering his complete reinstatement. (Doc. 1, Ex. B at 12.) McFadden ordered the company to reinstate Tschopp with back pay and benefits. He also required Tschopp to participate in counseling to better understand his attendance obligations. (Id. at 15.)

Dauphin Precision filed the instant suit on November 21, 2006 to vacate Arbitrator McFadden's award on the grounds that it fails to draw its essence from the terms of the CBA and that Arbitrator McFadden demonstrated was biased in favor of the USW. Both parties have filed motions for summary judgment. These issues have been fully briefed, and the motions are ripe for disposition.

II. Standard of Review

Through summary judgment the court may dispose of those claims that do not present a "genuine issue as to any material fact," and for which a jury trial would be an empty and unnecessary formality. See FED. R. CIV. P. 56(c). It places the burden on the non-moving party to come forth with "affirmative evidence, beyond the allegations of the pleadings," in support of its right to relief. Pappas v. City of Lebanon, 331 F. Supp. 2d 311, 315 (M.D. Pa. 2004); FED. R. CIV. P. 56(e); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986). This evidence must be adequate, as a matter of law, to sustain a judgment in favor of the non-moving party on the claims. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250-57 (1986); Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587-89 (1986); see also FED. R. CIV. P. 56(c), (e). Only if this threshold is met may the cause of action proceed. Pappas, 331 F. Supp. 2d at 315.

The court is permitted to resolve cross-motions for summary judgment concurrently. Cf. Assicurazioni Generali, S.P.A. v. Pub. Serv. Mut. Ins. Co., 77 F.3d 731, 733 & n. 2 (3d Cir. 1996) (observing that district court may dispose of case through cross-motions for summary judgment); see also 10A CHARLES ALAN WRIGHT ET AL., FEDERAL PRACTICE AND PROCEDURE § 2720 (3d ed. 1998). When doing so, the court is bound to view the evidence in the light most favorable to the non-moving party with respect to each motion. FED. R. CIV. P. 56; United States v. Hall, 730 F. Supp. 646, 648 (M.D. Pa.1990).

III. Discussion

Dauphin Precision's motion for summary judgment challenges Arbitrator

McFadden's award on the grounds that he disregarded the terms of the CBA and that he exhibited bias in favor of the USW. The USW's motion for summary judgment responds that neither argument is sufficient to vacate the award and requests entry of judgment in its favor. The court will address these issues seriatim.

A. Disregard for the Terms of the CBA

"'Full-blown judicial review of a labor arbitrator's decision[ is inappropriate because it] would annul the bargain of the parties for an arbitrator's construction of their [CBA]' and replace it with the court's constructions. Citgo Asphalt Refining Co. V. Paper, Allied-Indus., Chem., & Energy Int'l Union Local No. 2-991, 385 F.3d 809, 815 (3d Cir. 2004) (quoting Stroehmann Bakeries, Inc. v. Local 776, Int'l Bhd. of Teamsters, 969 F.2d 1435, 1441 (3d Cir. 1992)). A court will vacate an arbitration award only if the arbitrator's decision "is entirely unsupported by the record or if it reflects a manifest disregard of the agreement." Id. at 16 (quoting Exxon Shipping Co. v. Exxon Seamen's Union, 73 F.3d 1287, 1291 (3d Cir. 1996)). "An arbitrator's decision need be neither wise nor internally consistent." Id.

A court must enforce a labor arbitrator's interpretation of a CBA if the arbitrator's decision "draws its essence from the collective bargaining agreement." United Indus. Workers v. Gov't of the V.I., 987 F.2d 162, 170 (3d Cir. 1993). "A labor arbitration decision fails to draw its essence from the collective bargaining agreement if the arbitrator acted in manifest disregard of the law, or if the record before the arbitrator reveals no support whatsoever for the arbitrator's determination." Id. An arbitral award derived from the agreement "in any rational way" will be upheld. High Concrete Structures, Inc. v. United Elec., Radio & Mach. Workers of Am., Local 166, 879 F.2d 1215, 1219 (3d Cir. 1989). An arbitrator's resolution of ambiguous contractual language receives similar deference. See Exxon Shipping, 73 F.3d at 1296; United Transp. Union Local 1589 v. Suburban Transit Corp., 51 F.3d 376, 381 (3d Cir. 1995) (illustrating that a court should uphold an arbitrator's interpretation of a CBA if the arbitrator rendered a legitimate reading of the contractual provisions). Courts reviewing arbitrators' awards must adopt the arbitrator's findings of fact and inferences drawn from them. Citgo Asphalt, 385 F.3d at 815; Air Prods. & Chems., Inc. v. Teamsters Local 773, No. Civ. A. 06-1272, 2006 WL 2136137, at *1 n.1 (E.D. Pa. July 28, 2006).

In the case sub judice, the arbitrator found that Tschopp had a very similar pattern of absenteeism in 2004, 2005, and 2006 but was not singled out for discharge until 2006. (Doc. 1, Ex. B at 12.) Thus, the arbitrator determined that Dauphin Precision breached the CBA's just-cause requirement when it discharged Tschopp in 2006 after neglecting to do so in 2004 and 2005. A necessary corollary to this determination is the arbitrator's implicit conclusion that Tschopp's excessive absenteeism exposed him to discharge in both 2004 and 2005 in accordance with the applicable absenteeism policy.*fn8 In 2004, Tschopp accumulated three unexcused absences and ten improper vacation days. His unexcused absences alone were insufficient to warrant discharge; the absenteeism policy authorized discharge only when employees accumulated more than forty absentee hours, or five days. Arbitrator McFadden reached a similar conclusion for Tschopp's 2005 absences, fifteen days of which were improper vacation days and none of which were unexcused absences. Nevertheless, McFadden concluded that improper vacation days constitute "absentee hours" under the policy. On this issue, Dauphin Precision asserts that Arbitrator McFadden's award fails to draw its essence from the CBA because the absenteeism policy considers only unexcused absences-not improper vacation days-when calculating absentee hours.

The absenteeism policy contains no definition of "absentee hours," nor does it address its application to vacation days. (Doc. 1, Ex. A app. D.IV.) Confronted with a contractual ambiguity regarding the scope of the undefined term "absentee hours," the arbitrator concluded that an employee accrues absentee hours under the policy for both unexcused absences and improper vacation days. The court must therefore determine whether the arbitrator's resolution of this ambiguity is derived from the agreement "in any rational way." High Concrete Structures, 879 F.2d at 1219.

The CBA states that Dauphin Precision and the USW implemented the absenteeism policy "[t]o establish a . . . means to control absenteeism[] which is equitable to both the employee [sic]." (Doc. 1, Ex. A app. D.IV) Its purpose is to minimize the number of "employees who continually absent themselves from work." (Id.) Coyle further explained the policy's significance in a letter sent to Arbitrator McFadden prior to the arbitration hearing:

It is impossible to plan, schedule, or operated [sic] efficiently if we do not have proper, prior warning of absences and vacations. We acknowledge that there will be times when people have genuine emergencies and unforeseen circumstances. These occasions are unusual and in the minority. In the normal course, businesses need notice to plan effectively for coverage when employees are on vacation or using vacation time. We have an obligation to provide vacation time and time-off consistent with our policy and union contract. Employees have a similar and related obligation to provide proper notice when taking days off. Failure to provide such notice is in violation of the union contract, [sic] it is inconsistent with efficient operations and is ultimately unfair to the company and to fellow workers. (Doc. 19 at 43 (emphasis added)). Coyle's letter indicates that Dauphin Precision's primary reason for instituting the absenteeism policy was to secure advance notice of employee absences in order to make appropriate staffing arrangements. From the company's perspective, any employee absence taken without proper notice presents identical staffing problems. Viewed in this light, there is no material difference between an improper vacation day or an unexcused absence. The company's stated purpose for the absenteeism policy therefore supports the arbitrator's resolution of the term "absentee hours."*fn9 For these reasons, the court finds that the conclusion that the term "absentee hours" encompasses improper vacation days is rational and derives squarely from the agreement.

Arbitrator McFadden's interpretation of the policy rendered Tschopp eligible for termination in 2004 and 2005. Dauphin Precision's failure to terminate Tschopp created the expectation that it would refrain from strict enforcement of the policy's discharge provisions. Tschopp's subsequent discharge without notice violated the CBA's just-cause requirement. The court finds that this conclusion represents a rational implementation of the CBA based on the arbitrator's construction of the absenteeism policy. The arbitrator's interpretation therefore draws its essence from the CBA. Dauphin Precision's motion to vacate the arbitral award on the grounds that it is contrary thereto will be denied.*fn10

B. Bias of the Arbitrator

A court may vacate an arbitrator's award if the arbitrator demonstrates evident partiality in favor of one of the parties. See Tenet Healthsystem MCP, LLC v. Pa. Nurses Ass'n Local 712, No. Civ. A. 01-2201, 2002 WL 4637, at *3 (E.D. Pa. Dec. 20, 2001); see also United Indus. Workers, 987 F.2d at 171-72 (holding that arbitrator's "gratuitous remarks" regarding merits of a party's claim before hearing all evidence were failed to establish bias sufficient to vacate award); United Steelworkers of Am., AFL-CIO-CLC v. Hempt Bros., 866 F. Supp. 164, 167 (M.D. Pa. 1994). Evident partiality exists if "a reasonable person would have to conclude that the arbitrator was partial to [one] party." See HSM Const. Servs., Inc. v. MDS Sys., Inc., 239 F. App'x 748, 752-53 (3d Cir. 2007) (quoting Kaplan v. First Options of Chi., Inc., 19 F.3d 1503, 1523 n.30 (3d. Cir. 1994)); see also In re Prudential Ins. Co. of Am. Sales Practice Litig., 47 F. App'x 78, 79 n.3 (3d Cir. 2002). "The showing necessary to prove 'evident partiality' is not easily made; the circumstances surrounding the case must be strongly suggestive of bias." See Yorkaire, Inc. v. Sheet Metal Workers Int'l Ass'n, Local Union No. 19, 758 F. Supp. 248, 256 (E.D. Pa. 1990), abrogation recognized on other grounds, Luden's, Inc. v. Local Union No. 6 of Bakery, Confectionery, and Tobacco Workers Int'l Union of Am., 805 F. Supp. 313, 324 n.17 (E.D. Pa. 1992), vacated, 28 F.3d 347 (3d Cir. 1994). Mere hostility between the arbitrator and the parties' attorneys or representatives is insufficient to satisfy this standard. See Edward Mellon Trust v. UBS Painewebber, Inc., No. 2:06-CV-0184, 2006 WL 3227826, at *9 (W.D. Pa. Nov. 6, 2006) (quoting LLT Int'l, Inc. v. MCI Telecomms. Corp., 18 F. Supp. 2d 349, 354 (S.D.N.Y. 1998)) ("[A]crimony or negative feelings between the arbitrators and a party's attorneys do not indicate an appearance of bias, much less the evident partiality required to vacate an award.").

In the present case, the lone scintilla of evidence upon which Dauphin Precision alleges arbitral bias is Arbitrator McFadden's isolated remark that "Now I know what kind of employer you are." McFadden's comment did not reference the merits of either party's case or indicate that he had an interest in the proceeding. He expressed no opinion on the outcome of the case prior to issuing his decision. The impromptu comment primarily indicates that tension existed between McFadden and Coyle. This hostility alone does not constitute prejudice, and the reasonable person reviewing Arbitrator McFadden's words would not "have to conclude that [he] was partial to [one] party" as a result of his statement. HSM Const. Servs., 239 F. App'x at 752-53.

Dauphin Precision's failure to explain the context of the comment reinforces this conclusion. A1rbitrator McFadden's use of the words "Now I know" indicates that he uttered the comment in response to an event that occurred during the hearing, yet Dauphin Precision fails to identify this stimulus. It has also omitted any description of the discussion that preceded or followed the comment. Dauphin Precision's reliance on Arbitrator McFadden's single naked comment would leave the reasonable person wondering about the context that precipitated it. Without a greater awareness of this context, the reasonable person would be unable to conclude that Arbitrator McFadden's comment depicts bias in favor of the USW.

In contrast, the USW has produced sufficient evidence for a reasonable person to conclude that Arbitrator McFadden demonstrated no bias toward either party. The union's evidence portrays an arbitration proceeding that Coyle attempted to commandeer. McFadden made the unartful comment to regain control of the proceeding. The reasonable person could conclude that Arbitrator McFadden used the comment as a mechanism simply to get Coyle's attention and to exert greater authority over the proceeding. Obviously, that it was an isolated remark uttered in the midst of a heated exchange undercuts Dauphin Precision's claim of bias. In light of this contextual evidence, the reasonable person could conclude that Arbitrator McFadden was not biased in favor of the USW.

Dauphin Precision has not sustained its burden to oppose the USW's motion for summary with evidence that necessitates a finding by the reasonable person that Arbitrator McFadden was biased. The USW, however, has adequately responded to Dauphin Precision's motion by demonstrating that reasonable people could differ regarding his alleged prejudice. Accordingly, entry of summary judgment in favor of the USW is appropriate. Dauphin Precision's motion for summary judgment will be denied.*fn11

IV. Conclusion

Arbitrator McFadden's interpretation of the absenteeism policy rationally resolved an ambiguity in contractual language and therefore derives from the essence of the CBA. The evidence of record is insufficient to demonstrate that he engaged in clear arbitral bias. Dauphin Precision's motion for summary judgment (Doc. 16) will be denied. The motion for summary judgment of the USW (Doc. 20) will be granted, and the award of the arbitrator will be enforced.*fn12

An appropriate order will issue.


AND NOW, this 26th day of March, 2008, upon consideration of the motions for summary judgment (Docs. 16, 20), and for the reasons set forth in the accompanying memorandum, it is hereby ordered that:

1. The motion for summary judgment (Doc. 16) of Dauphin Precision Tool, LLC is DENIED.

2. The motion for summary judgment (Doc. 20) of United Steel Workers is GRANTED.

3. Defendant United Steel Workers shall be permitted to file, on or before April 16, 2008, a motion for attorneys' fees, costs, and expenses accompanied by a brief in support thereof. Attorneys' fees shall be enumerated by date and task performed and accompanied by the number of billable hours and rate applied to each task. All other costs shall be itemized according to the event for which they were incurred.

4. Plaintiff Dauphin Precision Tool, LLC shall be permitted to file, on or before May 2, 2008, a brief in opposition to any such motion.

5. Defendant United Steel Workers shall be permitted to file, on or before May 13, 2008, a brief in reply.

6. The Clerk of Court is directed to defer entry of judgment pending disposition of any motion filed in accordance with Paragraphs 3-5, supra. In the event that no such motion follows, the court will direct entry of judgment at a later date.

CHRISTOPHER C. CONNER United States District Judge

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