United States District Court, Central District of Illinois, Springfield Division
January 31, 1980
IN THE MATTER OF THE ARBITRATION BETWEEN ZEIGLER COAL COMPANY, PETITIONER/COUNTER RESPONDENT, AND DISTRICT 12, UNITED MINE WORKERS OF AMERICA, RESPONDENT/COUNTER PETITIONER.
The opinion of the court was delivered by: J. Waldo Ackerman, District Judge.
The parties have presented their case to this Court and the
petitioner, Zeigler Coal Co., has briefed the issue involved.
This opinion shall constitute my findings of fact and conclusions
of law in accordance with Federal Rules of Civil Procedure 52(a).
This action arises out of a petition by plaintiff Zeigler Coal
Company to vacate an arbitrator's award in favor of the Union,
District 12, United Mine Workers. The parties entered into a Coal
Wage Agreement which became effective March 28, 1978. This
dispute centers upon a provision of that agreement, Article XA,
which provides for a paid Christmas vacation for qualified
employees. Section (b)(i) of Article XA provides:
Qualifying Period: All employees who perform
regularly scheduled work during each of seven (7) or
more calendar months between December 24, 1977 and
December 25, 1978 shall be eligible to take off from
December 26 through December 31, 1978, and shall
receive as compensation five (5) times the Employee's
standard daily wage rate.
A similar provision covers the years 1979 and 1980. However, this
dispute relates to the year 1978.
The Company paid the qualified employees their standard daily
wage rate for the vacation period. A grievance was filed on
behalf of thirteen "Top" Employees seeking an additional 3/4
hours pay at time and a half for each day of Christmas vacation.
These employees regularly worked 3/4 hours of overtime each day,
being compensated at their Standard Daily Wage rate for 7 1/4
hours and at time and a half for 3/4 hours.
The grievance proceeded to arbitration, culminating in an award
to the employees of 3/4 hours overtime for each day of Christmas
vacation. The Arbitrator stated his conclusion as follows:
The fundamental purpose of payment being made to
employees who are granted vacation days or holidays,
days that represent surcease from work, is to assure
that respite from labor will not require a monetary
sacrifice. Holidays and vacations are to represent
days of rest without financial sacrifice.
Applying these objectives to the task of interpreting
Section (b)(i), it is apparent that payment to the
grievants of less than they ordinarily earn, for each
day, was not in accord with the basic intent of
Article XA. It is the basic intent that governs, not
words that transgress, doubtless unintentionally,
that basic intent.
The Company challenges the award primarily on the basis that
the contract is unambiguous, yet the arbitrator disregarded the
contract provision and instead substituted his "own brand of
industrial justice". Article IV, Section (e) of the Agreement,
entitled "Standard Daily Wage Rate" contains the following
language: "The standard daily wage rates paid for work performed
under this Agreement and set forth in Appendix A . . ." Appendix
A sets forth in dollar amounts the standard daily wage rates for
various job classifications. Part III of Appendix A governs the
employees involved in this case. A footnote to that Appendix
provides that the Standard Hourly Wage Rate is to be computed by
dividing the Standard Daily Wage Rate by seven and one-quarter (7
1/4) hours. The Company contends that the Contract is explicit in
providing for Christmas pay at the standard daily wage rate and
that the Contract is equally explicit in defining what that rate
is. Consequently, the company argues, the arbitrator exceeded his
authority by adding to the Contract a provision for an additional
3/4 hours overtime pay. The Company points out that the Contract
expressly provides for payment of regularly scheduled overtime
for holidays, vacation and other leave pay. See Articles IX(a)
Bereavement Pay, (b) Jury Duty, (d) Military Duty, (e) Personal
or Sick Leave, XII(e) Holidays, XIII(d) Regular Vacation and
XIV(f) Graduated Vacation. The lack of a comparable provision in
the Christmas vacation clause, the Company contends, clearly
manifests the parties' intention that overtime compensation not
The Court's power to vacate an arbitrator's award is severely
restricted by statute, Title 9 U.S.C. § 10, and by the strong
national policy favoring the resolution of grievances through
arbitration where the parties have agreed to be bound by an
arbitrator's determination. Amoco Oil Co. v. Oil, Chemical and
Atomic Workers International Union, Local 7-1, 548 F.2d 1288,
1293 (7th Cir.), cert. denied, 431 U.S. 905, 97 S.Ct. 1697, 52
L.Ed.2d 389 (1977). The Supreme Court outlined the narrow scope
of judicial review of arbitration awards in the Steelworkers
trilogy, United Steelworkers of America v. American Manufacturing
Co., 363 U.S. 564, 80 S.Ct. 1343, 4 L.Ed.2d 1403 (1960); United
Steelworkers of America v. Warrior & Gulf Navigation Co.,
363 U.S. 574, 80 S.Ct. 1347, 4 L.Ed.2d 1409 (1960);
United Steelworkers of America v. Enterprise Wheel & Car Corp.,
363 U.S. 593, 80 S.Ct. 1358, 4 L.Ed.2d 1424 (1960). In the
Enterprise Wheel case the Court pointed out that "[t]he refusal
of courts to review the merits of an arbitration award is the
proper approach to arbitration under collective bargaining
agreements. The federal policy of settling labor disputes by
arbitration would be undermined if courts had the final say on
the merits of the awards." 363 U.S. at 596, 80 S.Ct. at 1360. See
Painters Local 171 v. Williams & Kelly, Inc., 605 F.2d 535 (10th
Cir. 1979); Cannon v. Consolidated Freightways Corp.,
524 F.2d 290 (7th Cir. 1975).
This Court will review the arbitrator's award in this case with
these admonishments in mind. However, the arbitrator is not
unrestricted when fashioning an award. As the Supreme Court noted
in Enterprise Wheel:
[A]n arbitrator is confined to interpretation and
application of the collective bargaining agreement;
he does not sit to dispense his own brand of
industrial justice. He may of course look for
guidance from many sources, yet his award is
legitimate only so long as it draws its essence from
the collective bargaining agreement. When the
arbitrator's words manifest an infidelity to this
obligation, courts have no choice but to refuse
enforcement of the award.
363 U.S. at 597, 80 S.Ct. at 1361.
A Court may review and set aside an award if the arbitrator
exceeds his contractual authority. Cannon v. Consolidated
Freightways Corp., 524 F.2d 290 (7th Cir. 1975). I find that the
arbitrator, in rendering his decision in this case, exceeded his
authority. I am compelled to reach this conclusion despite the
great deference that must be accorded to the arbitrator's
decision. The arbitrator, in his conclusion, admits that his
opinion is contrary to the express language of the Contract. He
concludes, without stating any basis for his conclusion, that the
language employed in the Christmas vacation provision was an
unintentional transgression. Where an agreement, as here,
provides definitions of its own terms, the arbitrator clearly
exceeds his authority by seeking conflicting definitions outside
the record. Timken Co. v. Local 1123, United Steelworkers of
America, 482 F.2d 1012, 1015 (6th Cir. 1973). Further, the
arbitrator sought to buttress his conclusion with a statement
regarding the general fundamental purpose of vacation pay, but he
was not at liberty to dispense his "own brand of industrial
In a recent Sixth Circuit case, Detroit Coil Co. v.
International Association of Machinists and Aerospace Workers,
594 F.2d 575 (6th Cir. 1979), the Court of Appeals reversed a
district court's affirmance of an arbitrator's award. The
Agreement in that case provided that the company was to be
notified of a request for arbitration within eight days of the
Local Lodge meeting or any grievance would be considered settled.
A letter requesting arbitration of a particular grievance was
dated within the eight day period but was not received by the
company prior to the expiration of the time limit. The arbitrator
held that there was no evidence to indicate that it was the
intent of the Union to consider the grievance settled and noted
that in the past the parties had not used the excuse of time
limits to deny a grievance. Further, the arbitrator found that to
deny the arbitrability of this matter could result in the
deterioration of the good relationship between the Company and
The district court denied the Company's petition to vacate the
award, holding that the correctness of the arbitrator's decision
was not subject to review, so long as his decision was based upon
a construction of the contract and past interpretation and
application of the contract by the parties. The Sixth Circuit, in
reversing the district court, found that the arbitrator's award
was contrary to the explicit terms of the Agreement and beyond
the scope of his authority.
Thus, while an arbitrator has considerable latitude,
his powers are not unlimited in the resolution of
labor disputes. The arbitrator is confined to the
interpretation and application of the collective
bargaining agreement, and although he may construe
ambiguous contract language, he is without authority
to disregard or modify plain and unambiguous
Id. at 579.
Since the applicable section was clear and unambiguous, the
arbitrator was dispensing his own brand of industrial justice by
modifying the Contract.
The Fourth Circuit also reversed an affirmance of an
arbitrator's award by a district court in Monongahela Power Co.
v. Local 2332, IBEW, 566 F.2d 1196 (4th Cir. 1976). In that case,
the arbitrator found that a strike by the employees violated the
collective bargaining agreement. One clause of the Agreement
provided that the Company had the unqualified right to discharge
or discipline employees who violated the Agreement. The
arbitrator attempted to modify the disciplinary action taken by
the Company despite the Company's contention that under the
language of the provision involved, once a violation of the
Agreement was found, the arbitrator had no right to review, amend
or alter the type of discipline imposed by the Company.
The district court affirmed the award. The Fourth Circuit,
however, reversed, finding that although an arbitrator may
construe ambiguous language, he is without any authority to
disregard or modify plain and unambiguous provisions. Id. at
1199. This result stems from the fact that an arbitrator derives
his authority from and is bound by the terms of the Contract from
which he draws his authority and, as pointed out in the
Enterprise Wheel case, supra, an award is legitimate only if it
draws its essence from the collective bargaining agreement.
Another case which is strikingly similar to the case at bar is
Timken Co. v. Local 1123, United Steelworkers of America,
482 F.2d 1012 (6th Cir. 1973). In that case, an employee was given a
jail sentence for a traffic offense and spent twenty-nine days in
jail. His wife promptly notified the Company of the reason for
his absence. The Company terminated the employee under a
"voluntary quit" provision of the Agreement whereby an
unauthorized absence of seven consecutive scheduled work days was
considered to be a voluntary quit.
The arbitrator found the "voluntary quit" provision
inapplicable to cases such as this where the employee had no
intention of quitting and had promptly notified the employer of
his predicament. Rather, the arbitrator found the "voluntary
quit" provision was intended to apply to those cases where an
employee's location was unknown or where the employee was in
control of the circumstances but nevertheless absented himself
from work for longer than the prescribed period.
The district court vacated the award on the ground that since
the arbitrator did not find the absence to have been authorized
by the employer, he was bound by the employer's determination
that the absence was unauthorized. The Court of Appeals affirmed
the district court, holding that where an agreement provides
definitions of its own terms, an arbitrator exceeds his authority
when he seeks conflicting definitions outside the record. 482
F.2d at 1015. In the absence of evidence indicating the parties'
intent was to restrict the scope of the word "unauthorized", the
Court concluded that the arbitrator exceeded his authority in
stating the provision's purpose without support in the record.
Id. at 1015. See also, Mistletoe Express Service v. Motor
Expressmen's Union, 566 F.2d 692 (10th Cir. 1977); Steelworkers
Cooperative Local Lodge 1849 v. Tubular Products Division,
458 F. Supp. 192 (E.D.Wis. 1978); Litvak Packing Co. v. Butcher
Workmen, Local 641, 455 F. Supp. 1180 (D.Colo. 1978). Compare,
Service Personnel and Employees Local 205 v. Carl Colteryahn
Dairy, Inc., 436 F. Supp. 341 (W.D.Pa. 1977).
I recognize, as the court did in Timken, that an arbitrator may
properly utilize sources outside of the Agreement for context and
guidance but the dearth of such information in his opinion here,
as there, renders me unable to affirm an award which contradicts
the clear language of the Agreement. Indeed, the Company filed an
affidavit, uncontroverted by the Union, stating that no evidence
of contrary contract intent was presented to the arbitrator at
the hearing. The Agreement plainly states that Christmas pay will
be based upon the Standard Daily Wage Rate. The appendix to the
Agreement sets forth, in dollar amounts, the Standard Daily Wage
Rate. In the absence of some evidence that the parties, through
their negotiations or otherwise, intended payment to be at a rate
other than the Standard Daily Wage Rate, the arbitrator lacked
the power to contradict the express language of the Agreement.
Consequently, this Court grants the petitioner's motion to vacate
the arbitrator's award.
Lastly, this Court notes that the defendant Union has filed no
brief or memorandum of law in opposition to the motion to vacate
the Arbitrator's award. Said brief was due January 7, 1980 and no
extensions were requested. Although the petitioners bear the
burden of proof in this case, such a brief would have been useful
to this Court in making its determination.
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