Miller Brewing Co. v. BREWERY WORKERS LOC. U. NO. 9

• Decision Date: 06 May 1983
• Docket Number: Civ. A. No. 82-C-925.
• Citation: 562 F. Supp. 1368
• Court: U.S. District Court — Eastern District of Wisconsin
• Parties: MILLER BREWING COMPANY, Plaintiff, v. BREWERY WORKERS LOCAL UNION NO. 9, DIRECTLY AFFILIATED LOCAL UNION, AFL-CIO, Defendant.

562 F. Supp. 1368

MILLER BREWING COMPANY, Plaintiff, v. BREWERY WORKERS LOCAL UNION NO. 9, DIRECTLY AFFILIATED LOCAL UNION, AFL-CIO, Defendant.

Civ. A. No. 82-C-925.

United States District Court, E.D. Wisconsin.

May 6, 1983.

COPYRIGHT MATERIAL OMITTED

George K. Whyte, Jr., Milwaukee, Wis., for plaintiff.

George F. Graf, James P. Maloney, Milwaukee, Wis., for defendant.

DECISION AND ORDER

REYNOLDS, Chief Judge.

This is an action to vacate an arbitration award dated July 26, 1982, finding that the plaintiff Miller Brewing Co. had violated its collective bargaining agreement with the defendant Brewery Workers Local No. 9, Directly Affiliated Local Union, AFL-CIO, by recalling its temporary employees rather than preferentially hiring union members who lost their jobs at the Joseph Schlitz Brewing Co. when Schlitz closed its Milwaukee brewery. The arbitration award also required Miller to hire the former Schlitz employees who had applied for positions with Miller. The Union has filed a counterclaim seeking to confirm the arbitrator's decision.

Presently before the Court are the motion of Gary Lee Blawat, one of the temporary Miller employees who was recalled, to intervene as a third-party plaintiff, the motion of Blawat for class certification, and the motion of the defendant Union for summary judgment. The motion to intervene is opposed by the defendant Union and supported by the plaintiff Miller.

FACTS

The defendant Union was the certified representative for production employees of the Miller Brewing Co., Pabst Brewing Co., and Joseph Schlitz Brewing Co. These three companies constituted the Brewery Proprietors of Milwaukee, Wisconsin. The collective bargaining agreement entered into between the Union and the Brewery Proprietors effective from June 1, 1979 to June 1, 1981, in article I, set forth a recall procedure in which "regular employees laid off from other signatory Employers shall have preference in hiring before any such temporary employee is recalled."

Prior to the termination of the 1979-1981 collective bargaining agreement, the Joseph Schlitz Brewing Co. withdrew from the Brewery Proprietors to bargain separately with the Union over a contract covering June 1, 1981-June 1, 1983. Miller and Pabst, however, collectively bargained with the Union and on May 23, 1981 concluded a collective bargaining agreement effective from June 1, 1981 to June 1, 1983. The seniority provision of this new collective bargaining agreement provided in article I, section 5, that "regular employees laid off from other signatory employers or those employers signatory to the 1979-81 agreement shall have preference in hiring before any such temporary employee is recalled."

On June 1, 1981, the Union and Schlitz were without a contract and as a result, the Union went on strike against Schlitz. On July 31, 1981, Schlitz announced the permanent closing of its Milwaukee brewery effective September 30, 1981. Schlitz Brewing Co. sent its employees a Notice of Termination effective September 30, 1981. Subsequently, Schlitz and the Union entered into a shutdown agreement dated December 6, 1981.

On January 4, 1982 Miller Brewing Co. recalled 39 Miller "temporary" employees. Gene Pearson, a former Schlitz employee, filed a grievance alleging Miller Brewing Co. violated article I, section 5 of the labor agreement when Miller re-employed its temporary employees rather than hiring former Schlitz regular employees who lost their jobs when Schlitz closed its Milwaukee brewery. This grievance was processed through the grievance procedure set forth in the collective bargaining agreement without resolution.

The Union then demanded arbitration of the grievance and on May 14, 1982 a hearing was held before Arbitrator Edward B. Krinsky. On July 26, 1982, Arbitrator Edward B. Krinsky issued and delivered his award concluding that the regular employees of the Joseph Schlitz Brewing Co. were "laid off" within the meaning of the current labor agreement. The arbitrator determined that Miller had violated the agreement by recalling its temporary employees rather than granting preference to the permanently laid off Schlitz employees as required by article I of the collective bargaining agreement. Under article XXIV, section 3(a) of the collective bargaining agreement, the decision of the arbitrator is final and binding.

MOTION TO INTERVENE

Gary Lee Blawat seeks to intervene as a third-party plaintiff against the Union. The remedy he seeks is the same as that sought by Miller — vacation of the arbitrator's award. Blawat's standing to intervene to challenge the arbitration award is affected not only by the requirements of Fed.R.Civ.P. 24, but also by substantive principles of federal labor law. F.W. Woolworth Co. v. Miscellaneous Warehousemen's Union, Local No. 781, 629 F.2d 1204, 1208 (7th Cir.1980) cert. denied, 451 U.S. 937, 101 S.Ct. 2016, 68 L.Ed.2d 324 (1981). In this case, substantive rules of federal labor law preclude intervention.

The general rule that has developed is that an employee may not attempt to vacate an arbitration award unless the union has breached its duty of fair representation. In Acuff v. United Papermakers and Paperworkers, AFL-CIO, 404 F.2d 169 (5th Cir.1968), cert. denied 394 U.S. 987, 89 S.Ct. 1466, 22 L.Ed.2d 762 (1969), the grievance of 63 discharged employees was submitted to arbitration after the Union brought an action to compel arbitration in the district court. The arbitrator denied the grievance of 16 employees and ordered that the discharge of the remaining employees be reduced to a disciplinary layoff. The sixteen employees whose grievances were denied and some of the other employees whose grievances were denied in part sought to intervene in the district court, which had retained jurisdiction, and to vacate the award.

The Fifth Circuit held that the employees could not intervene. The Court noted that the right to organize entails certain burdens. "One of these is that to some extent the interests of particular individuals are subordinated to the interests of the group both at the contract negotiation stage and thereafter.... As a result, a union may properly determine not to pursue a member's grievance to the arbitration stage at all." 404 F.2d at 171. The court qualified its holding, however, by stating that relief might be forthcoming if the union had breached its duty of fair representation.

The Ninth Circuit has also held that a fairly represented employee may not seek to vacate an arbitration award. Andrus v. Convoy Co., 480 F.2d 604 (9th Cir.), cert. denied 414 U.S. 989, 94 S.Ct. 286, 38 L.Ed.2d 228 (1973).

The Seventh Circuit has allowed union members to intervene where they seek to uphold the arbitration award. In F.W. Woolworth Co. v. Miscellaneous Warehousemen's Union, Local No. 781, 629 F.2d 1204 (7th Cir.1980), cert. denied 451 U.S. 937, 101 S.Ct. 2016, 68 L.Ed.2d 324 (1981), the arbitration award was in favor of the discharged employees. The employer successfully prosecuted an action against the union to vacate the award. The union decided not to appeal the district court's ruling. Thereafter, the discharged employees sought to intervene and filed a notice of appeal. The district court denied their motion to intervene.

The Seventh Circuit summarized the applicable principles of substantive federal labor law as follows:

Thus under the system of collective bargaining mandated by the LMRA, the union (in contrast to the individual employees) is in control of the collective bargaining process and may, in the exercise of good faith and sound discretion, take employee grievances to various steps of the grievance procedure, including the ultimate step of arbitration, so long as it does not violate its statutory duty of fair representation. Vaca v. Sipes, 386 U.S. 171, 87 S.Ct. 903, 17 L.Ed.2d 842 (1967). The grievance procedure as such reaches its culmination in the arbitration award. But in addition, individual employees may not intervene in or maintain suits under the collective bargaining agreement to set aside arbitration awards reached in pursuance of the grievance procedure, particularly in opposition to the union, so long as the union has represented the employees fairly. Acuff and Andrus, both supra. These principles, and the policies underlying them, reflect the philosophy of collective bargaining incorporated in the LMRA and exemplify the fundamental policy of entrusting labor disputes and grievances to the good faith discretion of exclusive bargaining agents.

629 F.2d at 1210 (emphasis original).

The Seventh Circuit permitted intervention in F.W. Woolworth Co. only after weighing the factors for and against intervention and after examining whether intervention would conflict with any of the labor policies discussed in the cases. The court found four factors in favor of intervention: 1) that the employees were defending, not attacking the arbitration award; 2) that the union defended the award in the district court; 3) that the union did not object to intervention; and 4) that absent intervention, the employees may lose their day in court. The factors against intervention were that: 1) the union would no longer be an active participant; 2) the union might have ceded these claims to Woolworth in exchange for some other concession; and 3) the litigation would be prolonged.

In the present case, the only factor in favor of intervention is the fourth one noted in F.W. Woolworth Co. The remaining factors all weigh against intervention: the intervenors seek to vacate the arbitration award; the union opposes the award in the district court; and the union has objected to intervention. Additionally, the second factor against intervention in F.W. Woolworth Co. expressly recognizes the union's discretion to reasonably pursue its collective interests at the expense of the interests of a subgroup of its members. That is precisely the choice the defendant Union made in deciding to pursue...