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Michael R. Carrell & Christina Heavrin. Labor Relations and Collective Bargaining Eighth Edition. www.prenhall.com/carrell. PART IV: The Labor Relations Process in Action. CHAPTER 11 The Arbitration Process. © 2007 Prentice Hall Inc. All rights reserved. Chapter Outline.

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Presentation Transcript
slide1

Michael R. Carrell & Christina Heavrin

Labor Relations and

Collective Bargaining

Eighth Edition

www.prenhall.com/carrell

PART IV: The Labor Relations Process in Action

CHAPTER 11

The Arbitration Process

© 2007 Prentice Hall Inc. All rights reserved

chapter outline
Chapter Outline

History and Legal State of Arbitration

Arbitration of Statutory Rights in Union and Non-union Cases

Types of Arbitration

Selecting the Arbitrator

Determining Arbitrability

Hearing Procedures

Case Preparation

Contractual Issues

Arbitration Issues in the Public Sector

labor news
Labor News

Arbitrator Cites “Double Jeopardy”

Bus driver: terminated for his record of numerous minor offenses: 4 in one year

Employer: discipline code included termination after four offenses in the period of a year

Union: argued that his six-day suspension was the disciplinary action for the last offense, thus the termination decision was a second disciplinary action for the same offense, and was “double jeopardy,” or two penalties for the same offense.

Arbitrator: applied the “double jeopardy”principle and thus employer could not levy the second penalty--termination.

history and legal state of arbitration
History and Legal State of Arbitration

Arbitration is a matter of contract

Duty to arbitrate not influenced by the

merits of the underlying grievance

Presumption of arbitrability unless the

contract contains an explicit exclusion

of the issue under dispute

Courts should enforce arbitration award

without examining its correctness

  • Arbitrator’s award not limited by the
  • words of the contract
  • Past practice
  • Parol evidence
  • “Common law of the shop”

Lincoln Mills

Steelworkers

Trilogy

  • Five principles to
  • govern arbitration
history and legal state of arbitration cont
History and Legal State of Arbitration (cont.)

Lincoln Mills and the Steelworkers Trilogy (cont.)

Three issues have evolved from these decisions

General arbitrability - grievance is presumed to be arbitrable as long as the contract provides for arbitration and does not exclude the topic under consideration

Expired contracts or changes in ownership

duty to arbitrate can extend beyond the life of the contract

Successorship - successor employer not required to adopt the substantive terms of the predecessor’s agreement

Successor nonetheless inherits contractual duty to arbitrate as long as there is “substantial continuity” between old and new companies

If based on contract interpretation, arbitrators’ decisions should not be questioned by courts

history and legal status of arbitration cont
History and Legal Status of Arbitration (cont.)

Lincoln Mills and the Steelworkers Trilogy (cont.)

In sum, the Supreme Court:

Made it difficult to avoid arbitration if the contract requires the arbitration of grievances

Acknowledged the superiority of arbitration in resolving labor-management disputes under collective bargaining agreements

The arbitrator’s role is not unlimited

Role limited to interpretation and application of the contract

Arbitrator “does not sit to dispense his own brand of industrial justice”

As long as it is based on interpretation of the contract, arbitrator’s decision should be final and binding

arbitration of statutory rights in union and non union cases
Arbitration of Statutory Rights in Union and Non-Union Cases

Alexander v. Gardner-Denver

Public policy exception to labor arbitration

Court ruled that an individual could not be precluded from suing under Civil Rights laws just because his claim had gone through arbitration under the collective bargaining agreement

Title VII cases

Grievant who loses an EEO matter in arbitration entitled to take the matter to court

Wright v. Universal Maritime Service Corp.

If a collective bargaining agreement arbitration provision “clearly and unmistakably” includes anti-discrimination claims, the Court might require an employee to arbitrate such a claim before resorting to the federal court

arbitration of statutory rights in union and non union cases cont
Arbitration of Statutory Rights in Union and Non-Union Cases (cont.)

Individual employment agreements: 3 governing acts--1925 Federal Arbitration Act (FAA), 1926 Railway Labor Act (RLA); 1947 Labor Management Relations Act (LMRA)

Circuit City Stores Inc., v. Adams

Individual employees agreed to settle all claims against the employer by means of arbitration

Grievant filed employment discrimination lawsuit

Supreme Court ruled that the complaint must be heard by an arbitrator

Employment arbitration agreements have increased as a result of the Circuit City ruling

Green Tree Financial Corp.-Alabama v. Randolph

Court ruled that a party seeking to avoid an arbitration agreement must demonstratethe likelihood of prohibitive costs, not just the possibility

types of arbitration
Types of Arbitration

Interest arbitration

Occurs when a labor contract does not exist or when a change is sought

Used infrequently

Few parties are willing to allow a neutral third-party to set the terms of the labor agreement

Arbitrators tend to “split the difference,” thereby causing parties to take more extreme positions

types of arbitration cont
Rights (contract) arbitration

Involves interpretation of existing contract terms

Found in almost every labor agreement

Demand for rights arbitration

Based on the wishes and needs of the parties

Arbitration process is more private than public judicial proceedings

Involves more sophisticated and knowledgeable parties than those in most judicial proceedings

Types of Arbitration (cont.)
determining when to arbitrate a grievance
Determining When to Arbitrate a Grievance

Importance

of the

issue

Merits of

the case

Effect

of winning

Psychological

(face-saving) aspects

Effect

oflosing

Possibilities

for a

settlement

Considerations in

arbitrating a

grievance

selecting the arbitrator
Selecting the Arbitrator

Labor and management have a hand in the selection and compensation of the arbitrator

Arbitrator’s jurisdiction evolves from the collective bargaining agreement

Most arbitrators selected on an ad hoc basis

Permanent umpire - resolves disputes for the life of a contract

Helps to provide a stable union-management relationship

Impartial agency is generally the source of arbitrators

Federal Mediation and Conciliation Service

American Association

steps in selecting the arbitrator cont
Steps in Selecting the Arbitrator (cont.)

Step 1

At request of parties,

tribunal sends a list

of proposed arbitrators

Step 2

Parties given seven days to

study list, cross-off

unacceptable names, and

rank remaining names

Step 3

Additional names submitted

to parties if no mutually

acceptable names identified

Step 4

If parties cannot agree on a

mutually acceptable name,

tribunal will make an

administrative appointment

selecting the arbitrator cont
Roles of arbitrators

Must follow contract language when the intent of the provision is clear

When the language is ambiguous, arbitrator must interpret the provision in question

Interpretation of contract is guided by basic principles

Honor the intent of the parties

Interpret the agreement as a whole

Give effect to all terms of the agreement

Give undefined terms reasonable definitions

Avoid absurd results by considering reason and equity

Well-reasoned arbitrator’s opinion may become part of the contract

Selecting the Arbitrator (cont.)
selecting the arbitrator cont15
Role of arbitrators (cont.)

Two role models for arbitrators have been developed

Judge or umpire

Mediator or impartial chairperson

Arbitration services

Federal Mediation and Conciliation Service

Office of Arbitration Services

Maintains a roster of qualified arbitrators

Provides the parties with a list of arbitrators

Appoints arbitrators following selection by the parties

Selecting the Arbitrator (cont.)
selecting the arbitrator cont16
Selecting the Arbitrator (cont.)

Qualifications of arbitrators

Not required to have any specific educational or technical training

Have a variety of backgrounds

Variables that affect the arbitrator selection include:

Visibility

Past arbitration decisions

Use of procedural justice methods

General qualifications

Impartiality

Integrity

Ability and expertise

Legal training

selecting the arbitrator cont17
Tripartite arbitration board

Equal membership of labor and management

A neutral member who serves as chairperson

Majority award of the board is final and binding

Additional time and expense are incurred with a board

Chair has unique role to keep others informed, outline issues

Selecting the Arbitrator (cont.)
determining arbitrability
Determining Arbitrability

Not an issue if both parties agree to submit dispute to arbitrator

If one party challenges arbitrability

Courts may get involved

May grant an injunction

May issue court order to arbitrate

Arbitrability may be considered if an arbitrator’s award is submitted to a court for review

Arbitrator may rule on question of arbitrability

2004 Republic Waste Services: question of arbitrability due to expired contract & no “retroactivity” clause

hearing procedures
Hearing Procedures

Opening statement of each party

Lays groundwork for testimony of witnesses

Should clearly identify the issue, indicate what is to be proved, and specify the relief sought

Rules of evidence

Strict legal rules of evidence usually not followed

Arbitrator determines how evidence will be presented

Assessing credibility of witnesses

Arbitrator is both judge and jury

hearing procedures cont
Presenting documents

Sections of collective bargaining agreement that pertain to the grievance

Photographs, videos, other visual aids can be used

Examination of witnesses

Both direct- and cross-examination of witnesses

Summation

Both sides given equal time for closing statements

Each side emphasizes relevant facts and issues

Hearing Procedures (cont.)
hearing procedures cont21
Arbitrator’s award and opinion:

Awards - usually short, presented in written form, and signed by the arbitrator—may include money back pay, reinstatement to former position

Opinion - separate from the award

Statement of the reasons for the decision

Well-reasoned opinion can contribute greatly to the acceptance of the award

Hearing Procedures (cont.)
slide22

Case Preparation

Background

reading

Discuss

case

Study

other

party’s

case

Written

summary

witness

testimony

Interview

all

witnesses

Plan

arbitrator

trip to

plant

Assemble

documents

Review

labor

agreement

Examine

initiating

grievance

paper

Study

grievance

statement

and review

its history

11 -

22

© 2004 Prentice Hall Inc. All rights reserved

factors that may harm a party s case
Factors that May Harm a Party’s Case

Emphasize arguments,

minimize facts

Use arbitration

to harass

other party

Exaggeration

of party’s

case

Argue with

the other party

Conceal essential

facts

Discourteous

behavior

Hold back

supporting

documents

Withhold

cooperation

from arbitrator

Use unrehearsed

witnesses

Tie up

proceedings

Negative influence

on arbitrator’s

decision

contractual issues
Contractual Issues

Commonly arbitrated issues include:

Overtime pay, selection

Just cause: “Protection from arbitrary and capricious discipline has remained the rock-solid foundation upon which all other negotiated benefits have been based”

Contractual basis for the right-to-discipline or discharge workers

Definition of just cause in a specific instance is often interpreted by an arbitrator

“make whole” remedy common

Bureau of National Affairs criteria for just cause include:

Adequate warning

Prior investigation

Evidence

Equal treatment

Reasonable penalty

Rule of reason

Internal consistency (mgmt. Past practice in similar cases)

contractual issues cont
Contractual Issues (cont.)

Commonly arbitrated issues (cont.)

Seniority recognition issues (layoff, promotion, transfer)

Drug testing

Proving the fact of drug-related impairment through drug testing provides just cause test necessary for discipline

Arbitrators consider the following factors in deciding drug cases:

Does the drug testing procedure violate the contract?

Was the testing of the employee reasonable?

Was the test itself fair?

Was there on-the-job impairment?

Can an employee be disciplined for refusing to be tested?

contractual issues cont26
Contractual Issues (cont.)

Commonly arbitrated issues (cont.)

Absenteeism

Problems resulting from absenteeism include:

Lost productivity

Additional costs

Benefits

Administrative time

Management considers absenteeism a controllable problem

Unions recognize problems caused by unexpected absences

contractual issues cont27
Commonly arbitrated issues (cont.)

Incompetence

Should not be treated the same as a disciplinary problem

Proper remedies include training, transfer, or demotion

Management typically bears the burden of proving the worker’s incompetence

Holiday pay eligibility

Contract eligibility requirements must be fulfilled to receive pay for the holiday

Cost of this benefit predisposes management to arbitrate cases involving holiday pay

Holiday stretching is a related issue that is arbitrated

Contractual Issues (cont.)
contractual issues cont28
Commonly arbitrated issues (cont.)

Management rights

Arbitration frequently addresses management rights not expressly defined in the labor agreement

Arbitrators often, but not always, take the view that management retains all unstated rights

Standards of reasonableness and good faith used to evaluate managerial actions that adversely affect employees

Contractual Issues (cont.)
arbitration in the public sector
Arbitration in the Public Sector

Legislation permits collective bargaining, but prohibits strikes

Often details procedures to resolve bargaining impasses

Mediation provided in most states with collective bargaining

Fact finding and advisory arbitration more successful in public sector

Unbiased third party examines the impasse before issuing findings and recommendations

Legality of allowing a third party to set the terms of the contract has been questioned

arbitration in the public sector cont
Interest arbitration violates principle of bilateral settlement of collective bargaining issues

Discourages parties from making concessions

Frequently, award is a compromise between parties’ final positions

Proponents believe this is an incentive to negotiate

Rights arbitration: the authority of the arbitrator in rights arbitration is limited by the terms and conditions of the collective bargaining agreement

Arbitration in the Public Sector (cont.)