751 F.2d 203 (7th Cir. 1984), 83-3236, Communications Workers of America v. Western Elec. Co., Inc.

Docket Nº83-3236.
Citation751 F.2d 203
Party NameCOMMUNICATIONS WORKERS OF AMERICA and its Local 5090, Plaintiff-Appellee, v. WESTERN ELECTRIC COMPANY, INC., [*] Defendant-Appellant.
Case DateDecember 26, 1984
CourtUnited States Courts of Appeals, Court of Appeals for the Seventh Circuit

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751 F.2d 203 (7th Cir. 1984)




WESTERN ELECTRIC COMPANY, INC., [*] Defendant-Appellant.

No. 83-3236.

United States Court of Appeals, Seventh Circuit

December 26, 1984

Argued Sept. 18, 1984.

Page 204

Stanley Eisenstein, Katz, Friedman, Schur & Eagle, Chicago, Ill., for plaintiff-appellee.

Charles C. Jackson, Seyfarth, Shaw, Fairweather & Geraldson, Chicago, Ill., for defendant-appellant.

Before WOOD, Circuit Judge, SWYGERT, Senior Circuit Judge, and GRANT, Senior District Judge. [**]

HARLINGTON WOOD, Jr., Circuit Judge.

This appeal raises yet again, but in a different context, the question of the proper role for a court to play in deciding whether a dispute between an employee and employer is arbitrable under the terms of a collective bargaining agreement.


Defendant-Appellant, Western Electric (the "Company"), appeals from a district court order compelling it to arbitrate, under a collective bargaining agreement (the "Agreement"), a grievance filed by Plaintiff-Appellee, Communications Workers of America and its Local 5090 (the "Union"), challenging the September 25, 1981 layoff of 79 Illinois-based installers.

On September 17, 1981, the Union grieved the Company's announced intention to lay off 79 installers from its Chicago base location. The Union asserted that there was no lack of work at the Chicago location and that the layoff was therefore not justified under the terms of the Agreement. Specifically, the Union claimed that under the "Adjustments to the Working Force" clause (Article 20) 1 the Company can lay off only employees assigned to the base location where the lack of work exists. Notwithstanding the grievance, the Company laid off the Chicago employees on September 25, 1981 and soon thereafter transferred approximately 80 employees from Indiana and Wisconsin base locations to Chicago.

The Union then demanded arbitration of the dispute pursuant to the Arbitration clause of the Agreement (Article 8). 2 The Company refused to arbitrate, claiming that the "Management Functions" clause (Article 9) 3 gives it the unilateral right to lay off employees when it determines a lack of work exists in its facilities so long

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as it lays them off in the order prescribed by Article 20 of the Agreement.

The Union then sought the intervention of a court to compel arbitration pursuant to section 301 of the Labor Management Relations Act of 1947, 29 U.S.C. Sec. 185(a) (1982). The parties submitted several affidavits and took several depositions concerning the parties' intention regarding arbitrability of the dispute. Without reference to this parol evidence the district court found that the Union's interpretation of the Arbitration clause and other pertinent provisions was "arguable" and that there was no "express provision excluding a particular grievance from arbitration" or "forceful evidence of a purpose to exclude the claim from arbitration." Accordingly the court ordered arbitration of the arbitrability issue. 4

We affirm.


The Company argues on appeal that the district court erred in giving the arbitrability issue to the arbitrator rather than deciding the issue itself.

In support of its argument the Company quotes the following language from United Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582-83, 80 S.Ct. 1347, 1352-53, 4 L.Ed.2d 1409 (1960):

Sec. 301 of the Labor Management Relations Act ... assigned the courts the duty of determining whether the reluctant party has breached his promise to arbitrate. For arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit.

The Company also quotes from John Wiley & Sons v. Livingston, 376 U.S. 543, 84 S.Ct. 909, 11 L.Ed.2d 898 (1964) as follows: " 'Under our decisions, whether or not the company was bound to arbitrate, as well as what issues it must arbitrate, is a matter to be determined by the Court on the basis of the contract entered into by the parties.' " Id. at 546-47, 84 S.Ct. at 912-13 (quoting Atkinson v. Sinclair Refining Co., 370 U.S. 238, 241, 82 S.Ct. 1318, 1320, 8 L.Ed.2d 462 (1962)). Finally, the Company quotes the following language from this circuit's Associated Milk Dealers, Inc. v. Milk Drivers Union, Local 753, 422 F.2d 546 (7th Cir.1970) decision: "The district court must determine whether the dispute between the parties is arbitrable ... unless the parties voluntarily submit arbitrability to the arbitrator." Id. at 550 (citing Warrior & Gulf ).

The above quoted language establishes the general rule that the arbitrability issue is for the courts to decide unless otherwise stipulated by the parties. However, the holdings and other language contained in these and subsequent cases suggest that the rule is subject to an important exception: where deciding arbitrability would entangle a court in the construction of substantive provisions of a labor agreement. See Smith & Jones, The Supreme Court and Labor Dispute Arbitration: The Emerging Federal Law, 63 Mich.L.Rev. 751, 784 (1964) (arguing that Supreme Court cases up through 1964 suggest this exception to the rule that a court must decide arbitrability). In United Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. at 585, 80 S.Ct. at 1354, the Court admonished courts to "view with suspicion an attempt...

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