McCreedy v. Local Union No. 971, UAW

Decision Date23 January 1987
Docket Number85-3744,Nos. 85-3743,s. 85-3743
Parties124 L.R.R.M. (BNA) 2508, 105 Lab.Cas. P 12,166 William H. McCREEDY; Bernard Ashley; Augustin J. Aviles; Thomas D. Cloudt; Patrick Dangelo; Donald B. Defibaugh; Daniel S. DeRamus; Isaac Dick; Merlin Dyer; James Gallagher; Frank M. Gidlin; Nancy Glover; Kenneth Gumm; Harry L. Hayes; Billy J. Howington; Richard Lungler; Guy Mannarelli; George Miles; Wendell Naylor; Dolores Nichol; Ray Poll; Jay F. Carson; Ernest A. Zsebik; Wayne Schmiermund; Art Powell; Robert A. Roth; James Ryan; John S. Strasko; John Temple; William Ternes; Raymond E. Wilson; James Winerbrenner; Conrad Zeck; Charles C. VanAmburgh; Plaintiffs-Appellees, Cross-Appellants, v. LOCAL UNION NO. 971, UAW, et al., Defendants-Appellees, The Bendix Corporation, (Heavy Vehicle Systems Group), Defendant-Appellant Cross-Appellee.
CourtU.S. Court of Appeals — Sixth Circuit

Thomas H. Barnard, argued, David J. Somrak, Squire, Sanders & Dempsey, Cleveland, Ohio, for defendant-appellant cross-appellee.

Kirk B. Roose, Oberlin, Ohio, for plaintiffs-appellees, cross-appellants.

William P. Bobulsky, Betty Grdina, Bobulsky, Gervelis, & Grdina, Ashtabula, Ohio, Jordan Rossen, John Fillion, argued, Detroit, Mich., for defendants-appellees.

Before MARTIN, GUY and NORRIS, Circuit Judges.

BOYCE F. MARTIN, Jr., Circuit Judge.

This case presents two issues. First, what limitations period should be applied to a union's action to compel arbitration under section 301 of the Labor Management Relations Act, 29 U.S.C. Sec. 185? Second, when did the employees' "hybrid section 301" cause of action accrue?

I. History of the Case

The initial plaintiffs in this case are thirty-four former employees of Bendix Corporation's Heavy Vehicle Systems Group in Elyria, Ohio. They filed this action on August 5, 1983, alleging that Bendix had breached the collective bargaining agreement by not affording them transfer or preferential hiring rights when the Elyria plant closed. The employees also sued International Union UAW and its Local 971 alleging breach of their duty of fair representation. The Union filed a cross-claim against Bendix on August 17, 1984, seeking to compel arbitration on the underlying contractual dispute. Bendix moved for summary judgment on both claims on the ground that they were barred by the six-month statute of limitations provided for in section 10(b) of the National Labor Relations Act, 29 U.S.C. Sec. 160(b). The UAW moved for summary judgment against Bendix on its cross-claim. The district court granted Bendix' motion as to the employees, finding the hybrid section 301 action was barred by the statute of limitations. However, the district court granted the union's motion for summary judgment and ordered arbitration. The court was able to do this by borrowing the six year Ohio statute for contracts not in writing rather than applying the six month statute to the union's section 301 claim.

We find that the district court's application of such an extended statute to the union's action is contrary to federal labor policy and undermines the purpose of arbitration. The more appropriate limitations period is the six-month statute found in section 10(b) of the Act and it should have been applied to the union's action against Bendix. Thus the union's action against Bendix is also time barred.

II. Facts

Bendix and the UAW were parties to a collective bargaining agreement covering the Elyria, Ohio plant and effective from July 30, 1980, to July 31, 1983. Paragraph 154 of that agreement provided that if the company elected to move a department, line, or group, out-of-work employees could elect to be transferred to the new plant with their seniority intact and would be accorded preference in hiring on the conditions that the employees at the new plant were represented by the UAW and/or there was no certified bargaining unit which would result in the laying off of seniority employees. Article IV of the agreement outlined a grievance arbitration procedure which contained no specific time limits, except in the final step. There, it provided that "[i]f notice in writing of intent to appeal to arbitration is not received by the answering party within seven (7) calendar days after receipt of the final position, as above, the grievance shall be considered settled."

In March, 1982, Bendix announced that it would end production at the Elyria plant for economic reasons, and move the lines there to other Bendix plants. On May 2, 1982, at a meeting held for union employees, Bendix announced tentative plans to move the facilities to Newport News, Virginia.

On June 4, 1982, the UAW and Bendix met and negotiated a Plant Closing Agreement which defined the rights of the Elyria plant workers upon layoff and made no mention of transfer or preferential hiring rights. It also contained two statements which appear to contradict each other. It provided simultaneously, "[t]he terms of the collective Bargaining Agreement will continue to be observed except as modified by the terms of this Agreement," and,

[t]hese provisions resolve in full the matter of rights and benefits for terminated and laid off employees of the Company and represent the total agreements reached by the parties. The parties' collective bargaining agreements and all supplemental agreements dated July 31, 1980, are hereby superseded and terminated and of no further force and effect, as of July 31, 1983.

The agreement contained no specific reference to the survival of paragraph 154. The union membership ratified the Plant Closing Agreement in June, 1982.

In its brief, the union contends that even after ratification of the Plant Closing Agreement, it understood paragraph 154 to have remained in effect. Bendix states that preferential hiring and transfer rights were discussed during the negotiations. However, it argues that these rights had been bargained away in the course of negotiations and thus were intentionally left out of the Plant Closing Agreement.

On June 18, 1982, the president of the local UAW wrote to Bendix. In the letter, he requested that the union be given the opportunity to discuss keeping the jobs in Elyria or moving people pursuant to paragraph 154, in light of the company's decision not to move the work to Newport News. On June 25, 1982, Bendix responded with a somewhat ambiguous letter which stated that the issues raised by the UAW had been fully discussed during the negotiations surrounding the Plant Closing Agreement. Bendix alleges that this letter constituted notice to the UAW that it did not consider itself bound by paragraph 154. The UAW did not see this as a denial of its grievance.

On August 5, 1982, three months before he was laid off, William McCreedy submitted an application to Bendix asking for transfer or preference in hiring wherever the Elyria facilities might move. Bendix returned the application and enclosed a letter which stated that "the recent closing agreement ... [did] not contain provisions for transfer or hiring to another location." It also said, "[a]lthough HVSG has announced its intention to relocate from Elyria, a final determination as to the new site has not yet been made, consequently your application is not timely as well as not appropriate." Thus, McCreedy was told that his request was too early, and was simultaneously given some indication that regardless of when he submitted the application, Bendix may not honor it.

As of August 20, 1982, Bendix told the UAW that no final selection had been made between several alternative new plant sites. On October 26, a note was posted at the Elyria plant announcing that the operation would be "absorbed" into other existing facilities in London, Ontario, Charlotte, North Carolina, and Frankfort, Kentucky, though which products would go to which plants was still undetermined. Both London and Charlotte were UAW plants, meaning that if several other conditions were fulfilled, paragraph 154 could apply. The other conditions were 1) new jobs or a substantially new facility had to be created so preferential hiring or transfer could be accorded, 2) Elyria employees had to be out of work as a result of the movement of work, and 3) entire lines or departments must have been relocated.

McCreedy was laid off on October 29, 1982, and he and Bernard Ashley filed grievances on November 1, 1982, asking for transfer to the other plants and stating that if not accorded, a violation of paragraph 154 would occur. Bendix took the position that the layoffs were due to a lack of work and not to redeployment of the work.

A few days later McCreedy and eleven other employees applied for "transfer and or preference in hiring in Charlotte, North Carolina or any plant that the Elyria facilities are moving to." The next day five more employees filed grievances, stating that they were "aggrieved because the company did not notify us of moving out work and closing the plant, and did not advise us of our rights under the contract, paragraph 154." The company answered all of these grievances and applications in a letter written on November 11, 1982. In the letter they described the grievances and referred to their letter of June 25, 1982, as defining their position on the matter. It is this letter that the district court held constituted the notice and thereby the accrual of the plaintiffs' claim.

On November 17, 1982, (within the seven day period allowed for the UAW to appeal an unsettled grievance), McCreedy wrote a letter to four levels of the UAW. In it he recited paragraph 154, pointing to its specific language and intent and expressed uncertainty as to whether it would afford transfer to all locations or just one. He also requested that the UAW research the facts surrounding the company's rejection of his August, 1982, transfer application as "untimely and inappropriate", and asked that if necessary the UAW seek arbitration to secure the rights...

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