Bowen v. United States Postal Service

Decision Date11 January 1983
Docket NumberNo. 81-525,81-525
Citation74 L.Ed.2d 402,103 S.Ct. 588,459 U.S. 212
PartiesCharles V. BOWEN, Petitioner v. UNITED STATES POSTAL SERVICE et al
CourtU.S. Supreme Court
Syllabus

After petitioner employee was discharged by respondent United States Postal Service (USPS) as a result of an altercation with another employee, he filed a grievance with respondent Union as provided by the applicable collective-bargaining agreement. When the Union declined to take his grievance to arbitration, petitioner sued respondents in Federal District Court, claiming that he had been wrongfully discharged and seeking damages and injunctive relief. Entering judgment on a jury verdict against both respondents, the District Court held that the USPS had discharged petitioner without just cause and that the Union had handled his grievance in an arbitrary manner. Accordingly, the court upheld the jury's apportionment of damages between the USPS and the Union. The Court of Appeals affirmed except for the award of damages against the Union, holding that because petitioner's compensation was payable only by the USPS, reimbursement for his lost earnings continued to be the USPS's exclusive obligation, and that hence no portion of the deprivations was chargeable to the Union.

Held: Where the District Court's findings, accepted by the Court of Appeals, established that petitioner's damages were caused initially by the USPS's unlawful discharge and were increased by the Union's breach of its duty of fair representation, apportionment of the damages was required. Vaca v. Sipes, 386 U.S. 171, 87 S.Ct. 903, 17 L.Ed.2d 842. Pp. 218-230.

(a) The governing principle of Vaca is that where an employee proves that his employer violated the collective-bargaining agreement and that his union breached its duty of fair representation, liability is to be apportioned between the employer and the union according to the damages caused by the fault of each. To interpret this principle as requiring that an employer be solely liable for damages resulting from a wrongful discharge treats the relationship between the employer and employee, created by the collective-bargaining agreement, as if it were a simple contract of hire governed by traditional common-law principles. Such a reading fails to recognize that a collective-bargaining agreement is much more than traditional common-law employment terminable at will. Rather, it is an agreement creating relationships and interests under the federal common law of labor policy. Pp. 218-220.

(b) Of paramount importance is the right of the employee, who has been injured by both the employer's and the union's breach, to be made whole. Even though both the employer and the union have caused the damage suffered by the employee, the union is responsible for the increase in damages resulting from breach of its duty of fair representation having caused the grievance procedure to malfunction, and, as between the two wrongdoers, the union should bear its portion of the damages. Pp. 220-224.

(c) When the union, as the employee's exclusive agent, waives arbitration or fails to seek review of an adverse decision, the employer should be in substantially the same position as if the employee had had the right to act on his own behalf and had done so. In the absence of damages apportionment where the default of both the employer and the union contributes to the employee's injury, incentives to comply with the grievance proceeding would be diminished, and to impose total liability solely on the employer could affect the willingness of employers to agree to arbitration clauses. To require the union to pay damages does not impose a burden on the union inconsistent with national labor policy, but rather provides an additional incentive for the union to process its members' claims where warranted. Pp. 224-228.

(d) Czosek v. O'Mara, 397 U.S. 25, 90 S.Ct. 770, 25 L.Ed.2d 21, is not inconsistent with Vaca § recognition that each party should bear the damages attributable to its fault. Pp. 228-230.

642 F.2d 79, reversed and remanded.

William B. Poff, Roanoke, Va., for petitioner.

Barbara E. Etkind, Philadelphia, Pa., for federal respondent in support of the petitioner.

Asher W. Schwartz, New York City, for respondent Union.

Justice POWELL delivered the opinion of the Court.

The issue is whether a union may be held primarily liable for that part of a wrongfully discharged employee's damages caused by his union's breach of its duty of fair representation.

I

On February 21, 1976, following an altercation with another employee, petitioner Charles V. Bowen was suspended without pay from his position with the United States Postal Service. Bowen was a member of the American Postal Workers Union, AFL-CIO, the recognized collective bargaining agent for Service employees. After Bowen was formally terminated on March 30, 1976, he filed a grievance with the Union as provided by the collective-bargaining agreement. When the Union declined to take his grievance to arbitration, he sued the Service and the Union in the United States District Court for the Western District of Virginia, seeking damages and injunctive relief.

Bowen's complaint charged that the Service had violated the collective bargaining agreement by dismissing him without "just cause" and that the Union had breached its duty of fair representation. His evidence at trial indicated that the responsible Union officer, at each step of the grievance process, had recommended pursuing the grievance but that the national office, for no apparent reason, had refused to take the matter to arbitration.

Following the parties' presentation of evidence, the court gave the jury a series of questions to be answered as a special verdict.1 If the jury found that the Service had discharged Bowen wrongfully and that the Union had breached its duty of fair representation, it was instructed to determine the amount of compensatory damages to be awarded and to apportion the liability for the damages between the Service and the Union.2 In explaining how liability might be apportioned, the court instructed the jury that the issue was left primarily to its discretion. The court indicated, however, that the jury equitably could base apportionment on the date of a hypothetical arbitration decision the date at which the Service would have reinstated Bowen if the Union had fulfilled its duty. The court suggested that the Service could be liable for damages before that date and the Union for damages thereafter. Although the Union objected to the instruction allowing the jury to find it liable for any compensatory damages, it did not object to the manner in which the court instructed the jury to apportion the damages in the event apportionment was proper.3

Upon return of a special verdict in favor of Bowen and against both defendants, the District Court entered judg- ment, holding that the Service had discharged Bowen without just cause and that the Union had handled his "apparently meritorious grievance . . . in an arbitrary and perfunctory manner . . . ." 470 F.Supp. 1127, 1129 (WD Va.1979). In so doing, both the Union and the Service acted "in reckless and callous disregard of [Bowen's] rights." 4 Ibid. The court found that Bowen could not have proceeded independently of the Union 5 and that if the Union had arbitrated Bowen's grievance, he would have been reinstated. Ibid.

The court ordered that Bowen be reimbursed $52,954 for lost benefits and wages. Although noting that "there is authority suggesting that only the employer is liable for dam- ages in the form of back pay," it observed that "this is a case in which both defendants, by their illegal acts, are liable to plaintiff. . . . The problem in this case is not one of liability but rather one of apportionment. . . ." Id., at 1130-1131. The jury had found that the Union was responsible for $30,000 of Bowen's damages. The court approved that apportionment, ordering the Service to pay the remaining $22,954.6

On appeal by the Service and the Union, the Court of Appeals for the Fourth Circuit overturned the damage award against the Union. 642 F.2d 79 (CA4 1981). It accepted the District Court's findings of fact, but held as a matter of law that, "[a]s Bowen's compensation was at all times payable only by the Service, reimbursement of his lost earnings continued to be the obligation of the Service exclusively. Hence, no portion of the deprivations . . . was chargeable to the Union. Cf. Vaca v. Sipes, 386 U.S. 171, 195 [87 S.Ct. 903, 919, 17 L.Ed.2d 842] . . . (1967)." Id., at 82. The court did not alter the District Court's judgment in any other respect, but "affirmed [it] throughout" except for the award of damages against the Union. Id., at 83.

Thus, the Court of Appeals affirmed the District Court's apportionment of fault and its finding that both the Union and the Service had acted "in reckless and callous disregard of [Bowen's] rights." 7 Indeed, the court accepted the Dis- trict Court's apportionment of fault so completely that it refused to increase the $22,954 award against the Service to cover the whole of Bowen's injury. Bowen was left with only a $22,954 award, whereas the jury and the District Court had awarded him lost earnings and benefits of $52,954—the undisputed amount of his damages.

II

In Vaca v. Sipes, 386 U.S. 171, 87 S.Ct. 903, 17 L.Ed.2d 842 (1967), the Court held that an employee such as Bowen, who proves that his employer violated the labor agreement and his union breached its duty of fair representation, may be entitled to recover damages from both the union and the employer. The Court explained that the award must be apportioned according to fault:

"The governing principle, then, is to apportion liability between the employer and the union according to the damage caused by the fault of each. Thus, damages attributable solely to the employer's breach of contract should not be charged to the union, but increases if any in...

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