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Dyno Nobel, Inc. v. United Steel Workers AFL-CIO-CLC Union 10-59

United States District Court, W.D. Pennsylvania

December 16, 2014

DYNO NOBEL, INC., Plaintiff,
v.
UNITED STEEL WORKERS AFL-CIO-CLC UNION 10-59, Defendant

For DYNO NOBEL, INC., Plaintiff, Counter Defendant: Thomas P. McGinnis, LEAD ATTORNEY, Jeffrey D. Truitt, Thomas, Thomas & Hafer, LLP, Pittsburgh, PA; Brian R. Garrison, Mark J. Romaniuk, PRO HAC VICE, Faegre Baker Daniels LLP, Indianapolis, IN; Karin M. Romano, Thomas, Thomas & Hafer, Pittsburgh, PA.

For UNITED STEELWORKERS AFL-CIO-CLC, LOCAL UNION 10-859, Defendant, Counter Claimant: Nathan L. Kilbert, LEAD ATTORNEY, United Steelworkers International, Pittsburgh, PA; Amanda M. Fisher, United Steelworkers, Pittsburgh, PA.

MEMORANDUM AND ORDER

Cathy Bissoon, United States District Judge.

I. MEMORANDUM

For the reasons that follow, Defendant's Motion for Summary Judgment (Doc. 24) will be granted and Plaintiff's Cross-Motion for Summary Judgment (Doc. 27) will be denied. In addition, Defendant's request for an award of attorney's fees will be denied.

BACKGROUND

In this civil action, Plaintiff Dyno Nobel, Inc. (" Dyno Nobel") seeks to vacate an arbitration award which reinstated Christian Ruby to his job with back wages and benefits. Ruby was discharged pursuant to a policy in Dyno Nobel's employee handbook after receiving his third disciplinary warning within 12 months. Under the terms of the parties' collective bargaining agreement (" CBA"), Dyno Nobel was authorized to " make and enforce reasonable shop rules and regulations" and " suspend, discipline, [or] discharge for cause." (See Compl. Ex. A, Collective Bargaining Agreement, Art. III, Doc. 1-2.) Ruby's third and final disciplinary warning came after Dyno Nobel's plant manager allegedly discovered him sleeping on the job -- conduct which would " ordinarily warrant corrective actions" according to the employee handbook. (See Compl. Ex. B (hereafter, " Arbitration Decision") at 8, Doc. 1-4.) After the Defendant Union grieved Ruby's termination, Arbitrator Christopher Miles found that Dyno Nobel had failed to establish " cause" for Ruby's discharge because the Company had not established, by clear and convincing evidence, that Ruby had in fact been asleep while working. Consequently, Arbitrator Miles ordered that Ruby be reinstated and made whole for his lost wages and benefits.

ANALYSIS

A. Dyno Nobel's Challenges to the Arbitration Award

This Court's authority to disturb a labor arbitration award is extremely limited. Federal courts must generally enforce an arbitration award " if it was based on an arguable interpretation and/or application of the collective bargaining agreement, and may only vacate it if there is no support in the record for its determination or if it reflects a manifest disregard of the agreement, totally unsupported by principles of contract construction." Exxon Shipping Co. v. Exxon Seamen's Union (" Exxon I"), 993 F.2d 357, 360 (3d Cir.1993) (citation and internal quotation marks omitted). See also Giant Eagle, Inc. v. United Food & Commerical Workers Union Local 23, 547 Fed.Appx. 106, 108 (3d Cir. 2013) ( quoting Exxon I) . " [A]s long as the arbitrator's award draws its essence from the [CBA] and is not merely [the arbitrator's] own brand of industrial justice, the award is legitimate." Citgo Asphalt Refining Co. v. Paper, Allied--Indus., Chem., and Energy Workers Int'l Union Local No. 2-991, 385 F.3d 809, 816 (3d Cir. 2004) ( quoting United Paperworkers Int'l Union, AFL-CIO v. Misco, Inc., 484 U.S. 29, 36, 108 S.Ct. 364, 98 L.Ed.2d 286 (1987))(alterations in the original). Based on the circumstances of this case, the Court is satisfied that the arbitrator's award drew its essence from the parties' CBA.

An award draws its essence from a collective bargaining agreement if its interpretation can in any rational way be derived from the agreement, viewed in light of its language, its context, and any other indicia of the parties' intention. Brentwood Med. Assoc. v. United Mine Workers of Am, 396 F.3d 237, 241 (3d Cir. 2005) (emphasis in the original). Here, the arbitrator framed the issue to be resolved as " whether the Company had just cause to discharge Mr. Ruby, " (Arbitration Decision at 7), and he cited the CBA's " cause" provision at various points throughout his decision. (Id. at pp. 5, 7, 10-11.) Because the CBA permitted Dyno Nobel to enforce " reasonable shop rules and regulations, " and because Ruby's discharge was based upon such a rule, the arbitrator also referenced the portions of Dyno Nobel's handbook that were relevant to Ruby's third and final disciplinary warning. Notably, Ruby denied the alleged misconduct that served as the basis for the dispositive warning. Neither the CBA nor (apparently) the " Three Written Warnings Policy" prescribed a particular standard of proof in determining when " cause" exists for discipline or discharge, [1] so the arbitrator implicitly construed these documents as requiring clear and convincing evidence. Given these circumstances, it is evident that the arbitration award draws its essence from the collective bargaining agreement.

In challenging the award, Dyno Nobel primarily takes issue with the arbitrator's use of the " clear and convincing evidence" standard and the manner in which he framed the relevant issue. According to Dyno Nobel, the only issue in contention was whether the company had cause to discipline Ruby for the third time. It argues that the arbitrator should not have required " clear and convincing" evidence to support the third disciplinary warning, because there is no evidence that this standard was utilized in connection with Ruby's first two disciplinary warnings. By failing to apply a uniform standard of proof, Dyno Nobel argues, and by improperly focusing on the issue of termination rather than discipline, the arbitrator errantly treated the third incident as a stand-alone, terminable event, contrary to the terms of the CBA and Dyno Nobel's " Three Warnings Policy." According to Dyno Nobel, this shows that the arbitrator based his award on his own personal considerations of fairness and equity rather than on the parties' collective bargaining agreement.

The Court finds no merit in this argument. First, the Court finds nothing inappropriate with the manner in which Arbitrator Miles framed the matter for resolution. Federal courts " give deference to an arbitrator's interpretation of the issue submitted." Giant Eagle, Inc. v. United Food & Commerical Workers Union Local 23, 547 Fed.Appx. 106, 110 (3d Cir. 2013) (citation omitted). Although Arbitrator Miles characterized the relevant issue as " whether the Company had just cause to discharge Mr. Ruby" (Arbitration Decision at 7), he also recognized that Ruby was terminated because he was issued a third disciplinary warning within a 12-month period; accordingly, Arbitrator Miles appropriately observed that Dyno Nobel had " the burden of proving there was just cause to issue the third written warning." (Id. (emphasis added).) Arbitrator Miles then recognized that the more specific " question remaining" was " whether the Company established by clear and convincing evidence that Mr. Ruby was asleep while on duty and operating the Front End loader..." (Id. at 7-8.) This was perfectly appropriate given that, at the arbitration hearing, both Ruby and the Union contested Dyno Nobel's underlying assertion that Ruby had been asleep on the job.

Second, the Court does not agree with the premise that the arbitrator improperly treated Ruby's final disciplinary warning as the sole reason for his discharge by supposedly requiring a higher evidentiary burden for that offense than was utilized in relation to the previous warnings. As Dyno Nobel admits in its complaint -- and as the arbitration decision makes clear, Ruby's first two warnings were not ultimately challenged by the Union ( see Compl. ΒΆ 25, Doc. 1; Arbitration Decision 5-6, Doc. 1-4), so there is no basis from ...


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