Container Products, Inc. v. United Steelworkers of America, and its Local 5651, 87-3932

• Decision Date: 30 May 1989
• Docket Number: No. 87-3932,87-3932
• Citation: 873 F.2d 818
• Parties: 131 L.R.R.M. (BNA) 2623, 112 Lab.Cas. P 11,216 CONTAINER PRODUCTS, INC., Plaintiff-Appellee, v. UNITED STEELWORKERS OF AMERICA, AND ITS LOCAL 5651, Defendants-Appellants. Summary Calendar.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 818

873 F.2d 818

131 L.R.R.M. (BNA) 2623, 112 Lab.Cas. P 11,216

CONTAINER PRODUCTS, INC., Plaintiff-Appellee, v. UNITED STEELWORKERS OF AMERICA, AND ITS LOCAL 5651 Defendants-Appellants.

No. 87-3932

Summary Calendar.

United States Court of Appeals Fifth Circuit.

May 30, 1989.

Rudolph L. Milasich, Jr., Pittsburgh, Pa., Patricia Guthrie Fraley, Birmingham, Ala., for defendants-appellants.

Cornelius R. Heusel, Kullman, Inman, Bee & Downing, S. Mark Klyza, New Orleans, La., for plaintiff-appellee.

Appeal from the United States District Court for the Eastern District of Louisiana.

Before RUBIN, POLITZ and JOHNSON, Circuit Judges.

JOHNSON, Circuit Judge:

This case focuses on the limited power of a court to exercise authority over an arbitration award. The line of events bringing this case before us commenced in January of 1987, when Pascal J. Barone, III (the grievant-employee), was training a new employee at Container Products, Inc. (the Company). After a dispute ¹ between a foreman and Barone concerning the type of work which Barone should be performing, Barone was discharged. The United Steelworkers of America and its Local 5651 (the Union), filed a grievance on Barone's behalf. The Company and the Union agreed to forego any preliminary steps and proceed directly to arbitration.

The arbitrator, despite an implicit finding of just cause for dismissal, reinstated Barone and ordered other relief. The district court, finding that the arbitrator had exceeded his authority, vacated the portion of the award that fashioned a remedy and reimposed the discharge.

I. ARBITRATOR'S AWARD

The Company and the Union are parties to a Collective Bargaining Agreement which provides in pertinent part that "[s]hould it be determined by the arbitrator that an employee has been suspended or discharged for proper cause therefor, the arbitrator shall not have jurisdiction to modify the degree of discipline imposed by the Company." Prior to arbitration, the parties stipulated that the issue before the arbitrator inquired into whether there was "just cause for the discharge of Pascal J. Barone, III? If not, what shall be the remedy?".

The arbitrator, without specifically determining the existence, vel non, of just or proper cause, ordered Barone reinstated without any backpay except for the crediting of seniority earned by him at the time of his discharge. The arbitrator additionally required that Barone be placed on probation for ninety work days from the date of reinstatement, and that he submit to a physical examination, at the Company's request and expense, for the purpose, inter alia, of revealing the use of controlled substances.

Following the imposition of this order, the Company filed an action in federal district court seeking to vacate the arbitrator's award insofar as it modified the discipline imposed by the Company. The Union counterclaimed for enforcement of the arbitrator's award. Both parties moved for summary judgment, which the district court granted in the Company's favor. The district court, reasoning that the arbitrator exceeded his authority because he modified the discipline imposed by the Company despite a finding that the Company had just or proper cause to discharge Barone, vacated the portion of the arbitrator's award fashioning a remedy, and reinstated the discharge. From this order, the Union appeals.

II. THE SCYLLA AND CHARYBDIS

It is well-settled that arbitration awards are peculiarly insulated from judicial review. "Because the parties have contracted to have disputes settled by an arbitrator chosen by them rather than by a judge, it is the arbitrator's view of the facts and of the meaning of the contract that they have agreed to accept." ² Consequently, the Supreme Court long ago determined that so long "as the arbitrator's award 'draws its essence from the collective bargaining agreement,' and is not merely 'his own brand of industrial justice,' the award is legitimate." ³ Simply put, the courts have limited power to review the merits of an arbitration award.

At essence in the case sub judice, however, is not the merits of the award, but the jurisdiction of the arbitrator. The contract clearly states that the arbitrator has jurisdiction to alter the disciplinary action imposed by the Company only if the arbitrator first makes a determination that the Company did not have just cause to impose discipline on the employee. The issue submitted to the arbitrator reflects this situation: as a prerequisite for altering the remedy imposed, the arbitrator must determine that no just cause for the discharge existed.

The arbitrator did in fact alter the remedy; however, he made no clear finding as to the existence or nonexistence of just cause. Our problem, then, is whether we should infer from the result alone that the arbitrator found the prerequisites necessary for his assumption of jurisdiction. We conclude that such an approach is not warranted. Rather, an examination of the entire opinion entered by the arbitrator mandates our conclusion that the arbitrator implicitly found the existence of just cause for dismissal. Consequently, the arbitrator's alteration of the remedy imposed by the Company constituted an ultra vires...