120 F.3d 886 (8th Cir. 1997), 96-1451, American Nat. Can Co. v. United Steelworkers of America

Docket Nº:96-1451.
Citation:120 F.3d 886
Party Name:AMERICAN NATIONAL CAN COMPANY, Appellant, v. UNITED STEELWORKERS OF AMERICA; Local No. 3628, United Steelworkers of America, Appellees.
Case Date:July 25, 1997
Court:United States Courts of Appeals, Court of Appeals for the Eighth Circuit

Page 886

120 F.3d 886 (8th Cir. 1997)




Steelworkers of America, Appellees.

No. 96-1451.

United States Court of Appeals, Eighth Circuit

July 25, 1997

Submitted Nov. 22, 1996.

Thomas Owen McCarthy, St. Louis, MO, argued, (Geoffrey M. Gilbert, St. Louis, MO, on the brief), for Appellant.

Rudolph Milasich, Jr., Pittsburgh, PA, argued, for Appellees.

Before McMILLIAN and MORRIS SHEPPARD ARNOLD, Circuit Judges, and BOGUE, [*] District Judge.

Page 887

McMILLIAN, Circuit Judge.

American National Can Company (ANC) appeals from a final order entered in the United States District Court 1 for the Eastern District of Missouri granting summary judgment in favor of United Steelworkers of America (USWA) and United Steelworkers of America, Local No. 3628 (Union) (together "defendants") and enforcing an arbitrator's award which held that ANC violated the "contracting out" provision of the parties' collective bargaining agreement (CBA) by transferring certain work and equipment from one ANC plant to another ANC plant. American Nat'l Can Co. v. United Steelworkers, No. 4:94 CV 2473 (E.D.Mo. Jan. 5, 1996) (hereinafter "slip op."). The district court ruled that the arbitrator's award draws its essence from the CBA and that the arbitrator was not bound by two prior arbitration awards involving the application of the same clause of the CBA. Slip op. at 5. For reversal, ANC argues that the district court erred in enforcing the arbitrator's award. For the reasons discussed below, we affirm.

I. Background

The underlying facts are undisputed. ANC operates a can manufacturing plant in St. Louis, Missouri (the St. Louis plant), for which USWA is the exclusive collective bargaining representative for ANC's St. Louis employees. The CBA, currently in effect from February 22, 1993, through February 22, 1998, includes, among other provisions, an agreement that disputes arising under the CBA will be submitted to grievance and arbitration procedures, a management reservation of rights provision, and a "contracting out" prohibition (Article 3.3) stating in part that "[t]he Company will not contract out work which is normally performed by employees at the particular location when there is appropriate equipment, skills, necessary time and qualified employees to perform such work."

In September 1993, ANC notified the Union that it was going to transfer the coffee can end and sanitary can end work from its St. Louis plant to its plant in Hoopeston, Illinois (the Hoopeston plant). The equipment for performing this work was to be dismantled and removed from the St. Louis plant, and reassembled at the Hoopeston plant. Both the St. Louis plant and the Hoopeston plant are ANC facilities, but employees at the Hoopeston plant are not represented by a labor organization.

The transfer of work and equipment took place in October 1993. As a result of the transfer, fifty to sixty bargaining unit employees were adversely affected and several employees were laid off. The Union filed a grievance asserting that this transfer of work and equipment violated Article 3.3, the contracting out prohibition, among other provisions of the CBA. The dispute was not settled through grievance procedures, and the Union sought arbitration. The matter was submitted to Arbitrator John J. Mikrut, Jr. (hereinafter "the arbitrator" or "Arbitrator Mikrut").

At the arbitration hearing, held on June 22, 1994, the Union argued that ANC had violated applicable provisions of the CBA, including Article 3.3, when it transferred the coffee can end and sanitary can end work from the St. Louis plant to the Hoopeston plant. In response, ANC argued that the arbitrator was required, according to principles of res judicata, to follow two prior arbitration awards, American Nat'l Can Co. (Hammond Plant) v. United Steelworkers, Gr. No. 41-89 (Feb. 20, 1993) (Mikrut, Arb.), and American Can Co. (Vancouver Plant) v. United Steelworkers, Local 2821, Gr. No. 002-9-79 (Mar. 29, 1980) (Cole, Arb.), each of which held that a certain intra-company transfer of work did not violate Article 3.3, as identically contained in an earlier version of the CBA. Arbitrator Cole, in his 1980 decision, found that ANC had not violated the contracting out provision when it manufactured cans at its unionized Vancouver plant by utilizing metal sheets which had already been decorated at one of its non-union facilities in Canada. Arbitrator Mikrut, in his 1993 decision, similarly found that ANC had

Page 888

not violated the contracting out provision when it had machinery, which had been produced at a non-union facility, repaired at the non-union facility rather than at its unionized Hammond plant where the machinery had been in operation. Thus, ANC argued, because those two prior arbitration awards involved the same parties, the same language of the CBA, and similar facts, Arbitrator Mikrut was bound in the present case to hold that the transfer of the coffee can end and sanitary can end work and equipment did not qualify as contracting out within the meaning of Article 3.3 of the CBA.

On September 30, 1994, the arbitrator found that ANC had violated Article 3.3 of the CBA. United Steelworkers v. American Nat'l Can Co., Gr. No. 93-55 (Sept. 30, 1994) (Mikrut, Arb.) (hereinafter "Mikrut 1994 Decision"). He considered the two prior arbitration awards cited by ANC but nevertheless concluded that "[ANC's] argument must be rejected because the Union's counter-argument that '... intra-corporate transfers of work' are encompassed within the sub-contracting prohibition of Article 3.3, is significantly more persuasive, within the context of the instant dispute, than that which has been adduced by [ANC] herein." Id. at 20-21 (emphasis added). The arbitrator explained in full:

This conclusion, although seemingly inconsistent with this Arbitrator's previous Award ..., nonetheless, is perceived to be proper insofar as the Arbitrator in the previous case was not presented with as thorough and comprehensive an articulation of the Union's position therein or the applicable arbitral authorities as that which has been presented by the Union in the instant case. Moreover, the Arbitrator further notes...

To continue reading