Local Div. 589, Amalgamated Transit Union, AFL-CIO, CLC v. Com. of Mass., AFL-CI
| Decision Date | 23 October 1981 |
| Docket Number | Nos. 81-1180,81-1198 and 81-1219,AFL-CI,P,AFL-CIO,CL,s. 81-1180 |
| Citation | 666 F.2d 618 |
| Parties | 109 L.R.R.M. (BNA) 2014 LOCAL DIVISION 589, AMALGAMATED TRANSIT UNION,laintiff, Appellant, v. The COMMONWEALTH OF MASSACHUSETTS, et al., Defendants, Appellees. LOCAL DIVISION 589, AMALGAMATED TRANSIT UNION,, et al., Plaintiffs, Appellees, v. The COMMONWEALTH OF MASSACHUSETTS, et al., Defendants, Appellants. LOCAL DIVISION 589, AMALGAMATED TRANSIT UNION,, Plaintiff, Appellee, v. The COMMONWEALTH OF MASSACHUSETTS, Defendant, Appellee, Massachusetts Bay Transportation Authority, Defendant, Appellant. |
| Court | U.S. Court of Appeals — First Circuit |
Linda R. Hirschman, Boston, Mass., with whom Jacobs, Burns, Sugarman & Orlove, Boston, Mass., Earle Putnam, Gen. Counsel, Douglas Taylor and Gromfine, Sternstein, Rosen & Taylor, P. C., Washington, D. C., were on brief, for Local Division 589, Amalgamated Transit Union.
Dwight Golann, Asst. Atty. Gen., with whom Francis X. Bellotti, Atty. Gen., Mitchell J. Sikora, Jr., Bruce E. Mohl, Stephen M. Limon, Asst. Attys. Gen., Boston, Mass. and Max Beck, Legal Intern, were on brief, for The Com. of Mass., et al.
Joseph Elcock, Gen. Counsel, Boston, Mass., with whom Ronald G. Busconi, Asst. Gen. Counsel, Boston, Mass., was on brief for the Massachusetts Bay Transportation Authority.
William J. Riley and Flamm, Kaplan, Paven & Feinberg, Boston, Mass., on brief for the Boston Lodge 264, District 38, Intern. Ass'n of Machinists and Aerospace Workers.
Before CAMPBELL, BOWNES and BREYER, Circuit Judges.
This case raises two difficult and important sets of questions concerning collective bargaining and rapid transit. First, can the Commonwealth of Massachusetts enact statutes that are inconsistent with assurances that its Transit Authority previously gave the Secretary of Labor as part of an application for federal grant money? Second, do those Massachusetts statutes unconstitutionally impair pre-existing collective bargaining contracts? We find that insofar as federal law is concerned, the state statutes are valid.
Since 1912 appellant, Local 589 of the Amalgamated Transit Union (the "Transit Union") has represented most Boston transit system employees. Before 1947, it negotiated contracts with the system's private owners (Boston Elevated Railway). Since 1947, it has negotiated with the system's public owner, which is now the Massachusetts Bay Transportation Authority (MBTA). 1 The MBTA is a public agency with power to enter into binding agreements on behalf of the Commonwealth. 2
On January 1, 1973, the Transit Union and the MBTA entered into a detailed agreement setting forth wages, hours and working conditions. We shall refer to that agreement as the Basic Agreement. Its most important provisions for present purposes are those governing the procedure for changing its terms.
As read literally, the Basic Agreement provides that its terms will remain in effect forever unless (1) both parties agree to a change or (2) an arbitration panel changes the Agreement's terms. The Agreement invokes a type of arbitration called "interest arbitration." Unlike "grievance arbitration," which involves the interpretation and application of existing contractual provisions, "interest arbitration" involves the creation of new substantive contractual terms, which will govern the parties' future relations. 3 To be more specific, the 1973 Basic Agreement provides:
a) The Basic Agreement and its provisions shall continue in force until December 31, 1975 "and from year to year thereafter unless changed by the Parties" after appropriate notice. (§ 600)
b) After appropriate notice the contract will "be opened up and the change or changes desired shall then be considered...." "Upon failure to reach a mutual agreement upon any of the changes desired ... the same shall be arbitrated as provided for in this Agreement and the Award shall then be entered into and become a part of this Agreement." (§ 601)
c) Arbitration is to be conducted by a "Board of Arbitration selected in a manner provided in Section 103." (§ 100)
d) The Board of Arbitration shall consist of three members, one selected by the As provided in these sections, the Basic Agreement was "opened up" at the end of 1975. The parties could not agree about the changes they had separately proposed, and they proceeded to arbitration. In 1976, the arbitration panel entered an award changing the Basic Agreement in various ways. But the arbitrators did not change the Agreement's procedure for making changes. And, they stated that "all provisions of the Agreement which are not modified by this Award shall continue in effect." They ruled that the Basic Agreement, as modified, would extend through December 31, 1977.
Transit Union, one by the MBTA, and the third chosen from a list of five provided by the American Arbitration Association (through a process of successive striking) of "persons experienced in transportation." (§ 103)
At the beginning of 1978, the Basic Agreement was again "opened up." Again the parties could not agree about the changes they had separately proposed. This time, however, they did not proceed to arbitration. In May, the Transit Union sought arbitration-and the MBTA began to prepare for arbitration. But in July, the Massachusetts legislature enacted a statute, Chapter 405 of the Acts of 1978. This statute, designed to hold down rapidly rising transit costs, mandated an arbitration procedure somewhat different from that contained in the Basic Agreement. The Transit Union immediately claimed that Chapter 405 was itself inconsistent with the Basic Agreement; and it insisted upon Basic Agreement-type arbitration. The MBTA believed that Chapter 405 was lawful, and it insisted upon Chapter 405-type arbitration.
The impasse was resolved on August 8, 1979 when the parties entered into a "Memorandum of Understanding." The Memorandum began by stating "that the Articles of Agreement entered into as of January 1, 1973, as amended shall be further amended as follows." The Memorandum went on to make a host of changes in the Basic Agreement, but it did not change the "interest arbitration" provisions in any relevant respect. 4 The Memorandum extended the Basic Agreement as modified by stating "The express term of the Articles of Agreement shall be January 1, 1978, to and including December 31, 1980." In signing the Memorandum, however, the MBTA wrote, "Approved as to form to the extent not inconsistent with Chapter 405 of the Acts of 1978."
At the end of 1980, the Basic Agreement 5 was once again opened up and the parties The major differences between the two sets of procedures are the following: the Basic Agreement procedure, as previously mentioned, involves three arbitrators. The Transit Union and the MBTA each select one arbitrator. The third, selected by the other two, is to be a person experienced in transportation matters. The arbitration standards used, while unspecified in the Basic Agreement, are presumably those traditionally used in local transit interest arbitration. 6
sought changes. At this point, the legislature, concerned about a possible transit shutdown due to lack of funds, enacted another statute, Chapter 581 of the Acts of 1980. That statute also sought to hold down costs by imposing additional conditions upon the arbitration (and collective bargaining) procedures. The parties immediately reiterated the positions they had taken in 1978. The Transit Union claimed that both Chapters 405 and 581 were illegal and that arbitration must take place in accordance with the Basic Agreement's specified procedure. The MBTA refused to arbitrate except in conformity with Chapters 405 and 581.
By contrast, the 1978 Chapter 405 procedure requires (1) that mediation precede arbitration, 7 (2) that a single arbitrator who is a resident of Massachusetts and "experienced in state and local finance," conduct the arbitration, 8 (3) that the arbitrator "rely primarily" on nine statutory factors, including "the financial ability of the authority to meet additional costs," and wages, hours and working conditions of comparable Massachusetts employees, 9 (4) that the arbitrator issue a written opinion analyzing the
application of the statutory factors, 10 and (5) that the arbitrator disallow any provision for cost of living adjustments after the expiration of a contract period. 11 Chapter 581, 12 enacted at the end of 1980, forbids the MBTA to bargain collectively or agree with the Transit Union about "inherent management rights." These rights are defined to include the right to hire, promote, assign, direct and discharge employees, 13 to direct and control programs and departments, to determine staffing levels, to assign overtime, to hire part-time employees, and to decide how to procure goods and services. Chapter 581 also forbids the MBTA to agree to pay pensions that are based upon overtime pay or to provide for automatic cost-of-living adjustments. It removed all of these matters from arbitration. 14
The Transit Union bases its claim that Chapters 405 and 581 are unlawful on two separate constitutional grounds. It makes a conceptually simple "Contract Clause" argument. It claims that the Basic Agreement constitutes a contract with the Commonwealth of Massachusetts. Chapters 405 and 581, in its view, unconstitutionally impair the obligations of that contract. 15 The Union also claims that those chapters violate the Supremacy Clause of the Constitution. 16 It argues that they are inconsistent with assurances that Massachusetts gave the Secretary of Labor under the Urban Mass Transportation Act (UMTA), § 13(c), 49 U.S.C. § 1609(c), and that such assurances, given to a federal official, must prevail, as a constitutional matter, over state law to the contrary. A few additional facts about UMTA will help to clarify this argument.
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