Local Union No. 721 United Packinghouse Food and Allied Workers, AFL-CIO v. Needham Packing Co.

• Decision Date: 06 June 1967
• Docket Number: AFL-CI,No. 52314,A,52314
• Citation: 260 Iowa 908,151 N.W.2d 540
• Parties: LOCAL UNION NO. 721 UNITED PACKINGHOUSE FOOD AND ALLIED WORKERS,ppellee, v. NEEDHAM PACKING COMPANY, Inc., d/b/a Sioux City Dressed Beef, a Corporation, Appellant.
• Court: Iowa Supreme Court

Page 540

151 N.W.2d 540

260 Iowa 908

LOCAL UNION NO. 721 UNITED PACKINGHOUSE FOOD AND ALLIED WORKERS, AFL-CIO, Appellee, v. NEEDHAM PACKING COMPANY, Inc., d/b/a Sioux City Dressed Beef, a Corporation, Appellant.

No. 52314.

Supreme Court of Iowa.

June 6, 1967.

Shull, Marshall Mayne, Marks & Vizintos, Sioux City, James A. Gilker, Fort Smith, Ark., and Royall, Koegel & Rogers, Washington, D.C., for appellant.

Cotton, Watt, Rockler & Jones, Chicago, Ill., and Harry H. Smith, Sioux City, for appellee.

STUART, Justice.

Needham Packing Company, Inc. has appealed from Orders of the District Court of Woodbury County which denied the company's application to vacate or interpret the award of a board of arbitration and granted the application of Local 721, United Packinghouse, Food and Allied Workers of America, AFL-CIO to enforce the award and appoint a hearing referee.

The controversy between the company and the union arose in May, 1961. The company's refusal to arbitrate because of an illegal strike was sustained by the Iowa courts. 254 Iowa 882, 119 N.W.2d 141. The United States Supreme Court, 376 U.S. 247, 253, 84 S.Ct. 773, 777, 11 L.Ed.2d 680, 685, reversed, saying: 'Needham's allegation by way of defense and counterclaim that the union breached the no-strike clause, supported by such facts as were undisputed on the pleadings, did not release Needham from its duty to arbitrate the union's claim that employees had been wrongfully discharged.'

An arbitration hearing was held in early December, 1964. The arbitrators for Needham and the union maintained the positions of the respective parties so it was agreed Harold W. Davey, the third member of the arbitration board, would write the majority opinion and make the award. He will hereinafter be referred to as the arbitrator.

Two grievances were considered. Grievance 1A relating to the discharge of Anton Stamoulis was denied and is not involved in this appeal. Grievance 2A requested the reinstatement of all employees listed thereon (approximately 183) with full seniority rights and full pay for all time lost 'because of the fact that they were improperly discharged'.

The majority opinion and award of the arbitration board reinstated all employees with full seniority and other contractual rights restored and awarded back pay from November 12, 1961 to the effective date of each grievant's reinstatement reduced by a six month disciplinary lay off and excluding the period of time 'when the case was before the courts' (February 13, 1962 through March 9, 1964).

Needham appealed this award to the Woodbury County District Court which decided: 'the grievance before the Arbitration Board was arbitrable', 'the board based its award on its interpretation of the collective bargaining agreement of the parties' and that 'the board had the authority under the collective bargaining agreement between the parties to render the award made herein'. At a subsequent hearing the trial court approved the union's application to enforce the award and postponed the appointment of a hearing referee pending determination of this appeal. Needham appealed from the final order and all interlocutory rulings and decisions adverse to it. We reverse.

This action arises under section 301(a) of the Labor Management Relations Act, as amended, 29 U.S.C.A. section 185(a) and is controlled by federal substantive law even though states have been accorded concurrent jurisdiction. Humphrey v. Moore, 375 U.S. 335, 344, 84 S.Ct. 363, 11 L.Ed.2d 370, 378 and citations.

In 1960 the United States Supreme Court decided three cases which defined the respective roles of the arbitrators and the courts in the arbitration of disputes under collective bargaining agreements. In United Steelworkers of America v. American Manufacturing Co., 363 U.S. 564, 80 S.Ct. 1343, 4 L.Ed.2d 1403, the court said: 'The function of the court is very limited when the parties have agreed to submit all questions of contract interpretation to the arbitrator. It is confined to ascertaining whether the party seeking arbitration is making a claim which on its face is governed by the contract. Whether the moving party is right or wrong is a question of contract interpretation for the arbitrator. In these circumstances the moving party should not be deprived of the arbitrator's judgment, when it was his judgment and all that it connotes that was bargained for.

'The courts, therefore, have no business weighing the merits of the grievance, considering whether there is equity in a particular claim, or determining whether there is particular language in the written instrument which will support the claim. The agreement is to submit all grievances to arbitration, not merely those which the court will deem meritorious. The processing of even frivolous claims may have therapeutic values of which those who are not part of the plant environment may be quite unaware.' 80 S.Ct. p. 1346, 4 L.Ed.2d p. 1407.

In United Steelworkers of America v. Warrior & Gulf Navigation Co., 363 U.S. 574, 80 S.Ct. 1347, 4 L.Ed.2d 1409, 1417--1418, the court said: 'The labor arbitrator's source of law is not confined to the express provisions of the contract, as the industrial common law--the practices of industry and the shop--is equally a part of the collective bargaining agreement although not expressed in it. The labor arbitrator is usually chosen because of the parties' confidence in his knowledge of the common law of the shop and their trust in his personal judgment to bring to bear considerations which are not expressed in the contract as criteria for judgment. The parties expect that his judgment of a particular grievance will reflect not only what the contract says but, insofar as the collective bargaining agreement permits, such factors as the effect upon productivity of a particular result, its consequence to the morale of the shop, his judgment whether tensions will be heightened or diminished. For the parties' objective in using the arbitration process is primarily to further their common goal of uninterrupted production under the agreement, to make the agreement serve their specialized needs. The ablest judge cannot be expected to bring the same experience and competence to bear upon the determination of a grievance, because he cannot be similarly informed.

'The Congress, however, has by § 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. Yet, to be consistent with congressional policy in favor of settlement of disputes by the parties through the machinery of arbitration, the judicial inquiry under § 301 must be strictly confined to the question whether the reluctant party did agree to arbitrate the grievance or did agree to give the arbitrator power to make the award he made. An order to arbitrate the particular grievance should not be denied unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute. Doubts should be resolved in favor of coverage.' 80 S.Ct. p. 1352, 4 L.Ed.2d pp. 1417--1418.

In United Steelworkers of America v. Enterprise Wheel & Car Corp., 363 U.S. 593, 80 S.Ct. 1358, 4 L.Ed.2d 1424, the court said: 'The refusal of courts to review the merits of an arbitration award is the proper approach to arbitration under collective bargaining agreements. The federal policy of settling labor disputes by arbitration would be undermined if courts had the final say on the merits of the awards.' 80 S.Ct. p. 1360, 4 L.Ed.2d p. 1427.

'* * * Nevertheless, an arbitrator is confined to interpretation and application of the collective bargaining agreement; he does not sit to dispense his own brand of industrial justice. He may of course look for guidance from many sources, yet his award is legitimate only so long as it draws it essence from the collective bargaining agreement. When the arbitrators' words manifest an infidelity to this obligation, courts have no choice but to refuse to enforce the award.

'The opinion of the arbitrator in this case, as it bears upon the award of back pay beyond the date of the agreement's expiration and reinstatement, is ambiguous. It may be read as based solely upon the arbitrator's view of the requirements of enacted legislation, which would mean that he exceeded the scope of the submission. Or it may be read as embodying a construction of the agreement itself, perhaps with the arbitrator looking to 'the law' for help in determining the sense of the agreement. A mere ambiguity in the opinion accompanying an award, which permits the inference that the arbitrator may have exceeded his authority, is not reason for refusing to enforce the award. Arbitrators have no obligation to the court to give their reasons for an award. To require opinions free of ambiguity may lead arbitrators to play it safe by writing no supporting opinions. This would be undesirable for a well reasoned opinion tends to engender confidence in the integrity of the process and aids in clarifying the underlying agreement. * * *'. 80 S.Ct. p. 1361, 4 L.Ed.2d p. 1428--1429.

'Respondent's major argument seems to be that by applying correct principles of law to the interpretation of the collective bargaining agreement it can be determined that the agreement did not so provide, and that therefore the arbitrator's decision was not based upon the contract. The acceptance of this view would require courts, even under the standard arbitration clause, to review the merits of every construction of the contract. This plenary review by a court of the merits would make meaningless the provisions that the arbitrator's decision is final, for in reality it would almost never be final. * * *

'It is the arbitrator's construction...