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Automobile Mechanics' Local 701, International Association of v. Ed Napleton Oak Lawn Imports

December 5, 2011


The opinion of the court was delivered by: Matthew F. Kennelly, District Judge:


Plaintiff Automobile Mechanics' Local 701, International Association of Machinists and Aerospace Workers, AFL-CIO, of Chicago and Vicinity (Local 701) has moved to confirm and enforce an arbitrator's award issued in an arbitration between Local 701 and Ed Napleton Oak Lawn Imports, Inc. (Napleton Honda). Napleton Honda has cross-moved to vacate or modify the arbitrator's award. For the reasons stated below, the Court grants both motions in part and denies them in part..


Napleton Honda and Local 701 are parties to a collective bargaining agreement (CBA). On April 27, 2011, Phil Savaglio, a member of Local 701 who had worked at Napleton Honda for over twenty-two years, had a dispute with another employee, Robert Sykes, over a work assignment. Frustrated, Savaglio told Sykes, "What do I have to do to get you guys to understand, bring a gun down here and shoot (somebody) up here tomorrow?" Ex. 1, p. 6. Another employee, Louis Ortiz, overheard the statement and reported it to the service department's manager, Spano. Spano investigated the incident and met with Sykes. Sykes told Spano that he did not feel threatened or afraid and that he did not think Savaglio had meant anything serious but rather was just trying to get a point across. Sykes said he thought Ortiz had taken Savaglio's statement out of context.

Shortly afterward, the Oak Lawn police arrived, saying someone had reported Savaglio's threat. They spoke with Savaglio and Spano and left without a complaint being filed. At the time, no one was aware of who had called the police. An internal company memo later reported that while the police were interviewing Savaglio, Ortiz was observed laughing about the incident with two other employees.

Later that afternoon, General Manager Ed Napleton, Jr. met with Savaglio. Napleton told Savaglio that "he could not say those words," issued him a verbal warning, and suspended him from work for one day. Savaglio met with Napleton and Spano again the next day. Napleton said he was issuing a written warning and a one day suspension. Before this meeting, Spano had spoken with a Local 701 representative. Savaglio said he was willing to take a week off, but management said that was not necessary.

The original intention was for Savaglio to serve his suspension the next day, April 29. However, he was working on a big job, and Napleton and Spano decided it would be best for Savaglio to finish that job. Savaglio then planned to serve the suspension on May 2, but Spano said Savaglio was needed for work that day and should serve the suspension on May 3 instead. Savaglio served the suspension on May 3, 2011.

On May 12, Savaglio was summoned to corporate headquarters in Westmont, Illinois. There he met with Ed Napleton Sr. and chief financial officer Bruce Etheridge. The three men discussed the April 27 incident, and Savaglio was asked to resign. He refused to do so and was terminated. effective immediately.

Local 701 filed a grievance, alleging that the discharge was improper and without just cause. The parties were unable to resolve the grievance, and, consistent with the CBA, an arbitration hearing was held on May 27, 2011.

At the hearing, Napleton Honda argued that it would be "negligent retention" to keep Savaglio at work. It also argued -- apparently anticipating a "double punishment" argument -- that the warning letter and the suspension had been issued prematurely. Napleton Honda contended the appropriate corporate procedure would have been to consult with corporate headquarters and that Ed Napleton Sr. had properly terminated Savaglio when he became aware that the incident had been reported to the local police. Local 701 argued that Savaglio had been properly disciplined when he received the warning letter and served the suspension and that it was improper for the company to discharge him two weeks later, after he had already been disciplined for the incident.

After the hearing, the arbitrator made the following findings: (1) the initial warning letter was proper under the CBA, in part because it had been issued under the authority of Ed Napleton Jr., the dealership's general manager; (2) Local 701 challenged only the duplicative disciplinary measure, not Savaglio's culpability; (3) given the findings of Napleton Honda's investigation into the incident, including its determination that no threat was intended, the warning letter and the suspension constituted proper and appropriate discipline.

Based on these findings, the arbitrator determined that Savaglio's discharge constituted "double jeopardy" for the incident and was therefore improper and unjust, as well as untimely. The arbitrator directed Napleton Honda to reinstate Savaglio with full rights and benefits and to compensate him for all lost income.

Napleton Honda refused to comply with the order and later filed a police report, initiating a criminal charge. When Savaglio went to court, a judge imposed a condition of bond requiring Savaglio to stay away from the Napleton Honda work premises.

In the present case, Local 701 requests an order confirming and enforcing the arbitrator's award, pursuant to section 301(a) of the Labor-Management Relations Act, 29 U.S.C. §185(a), and the Federal Arbitration Act (FAA), 9 U.S.C. § 9 . Napleton Honda asks this Court to vacate or modify the arbitrator's award, arguing that reinstating Savaglio would subject it to ...

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