Saint Mary Home, Inc. v. Service Employees Intern. Union, Dist. 1199

Decision Date30 May 1997
Docket NumberNo. 1348,AFL-CI,D,1348
Parties155 L.R.R.M. (BNA) 2456, 65 USLW 2809, 134 Lab.Cas. P 10,000 SAINT MARY HOME, INC., Plaintiff-Appellant, v. SERVICE EMPLOYEES INTERNATIONAL UNION, DISTRICT 1199; New England Health Care Employees Union,efendants-Appellees. ocket 96-9353.
CourtU.S. Court of Appeals — Second Circuit

Hugh F. Murray, III, Murtha, Cullina, Richter and Pinney, Hartford, CT (Thomas M. Cloherty, of counsel), for Plaintiff-Appellant.

John M. Creane, Law Firm of John M. Creane, Milford, CT (Michael E. Passero, of counsel), for Defendants-Appellees.

Before: WALKER, McLAUGHLIN and CUDAHY, * Circuit Judges.

WALKER, Circuit Judge.

In this appeal from an order of the United States District Court for the District of Connecticut (Janet Bond Arterton, Judge ) two questions are raised: (1) whether an arbitration award ordering the reinstatement without back pay of an employee of a skilled nursing facility who had been discharged by the facility for possession of marijuana with intent to distribute was beyond the arbitrator's authority under the collective bargaining agreement and, (2) if not, whether the award violates public policy. We answer both questions in the negative and, thus, affirm the district court's denial of the facility's motion to vacate the arbitral award.


On March 18, 1994, Ted Barron, an employee of St. Mary Home, Inc. (the "Home"), had an argument with a fellow employee during work hours over the care of one of the residents. The argument became physical, and Barron's co-worker suffered a sprained wrist. Later that day the police arrested Barron for assault. During a search incident to the arrest, the police found in Barron's possession three-quarters of an ounce of marijuana, several empty plastic bags, plastic tweezers, and a small scale. Local prosecutors charged Barron with assault in the third degree and possession of marijuana with intent to sell, and soon thereafter the Home discharged him.

Barron's unions, the Service Employees International Union, District 1199, and the New England Health Care Employees Union, AFL-CIO (collectively the "Union"), filed a grievance on his behalf contesting the dismissal under the collective bargaining agreement (the "CBA") between the Union and the Home. After the grievance procedure failed to resolve the dispute, the Union invoked the CBA's binding arbitration provisions, which provide, in relevant part:

1. A grievance ... which has not been resolved ... may, within ten (10) working days after the completion of ... the grievance procedure, be referred for arbitration by the Home or the Union to an arbitrator selected in accordance with the American Arbitration Association....

2. The request for arbitration shall set forth the nature of the grievance and shall state what provisions of this Agreement are claimed to be [involved].

* * * * * *

4. The opinion and award of an arbitrator hereunder shall be in writing and the award shall be final, conclusive and binding upon the Home, the Union and the Employees.

5. The arbitrator shall have jurisdiction only over disputes concerning grievances as defined in Section 1 of Article XXVI [that is, a dispute concerning interpretation, application, performance, termination or breach of the agreement] and he shall have no power or authority to add to, subtract from, or modify in any way the terms of the Agreement.

Joint Appendix at 46-47. The relevant provisions of the CBA pertaining to discharge states simply that the "Home shall have the right to discharge, suspend or discipline any Employee for cause." Id. at 40. The CBA, however, does not specifically define grounds that constitute a basis for discharge. In Barron's arbitration, the parties jointly submitted two questions: "Was Ted Barron discharged for just cause? If not, what shall be the remedy?" While the arbitration was pending, the state reduced the charges against Barron to one of simple possession of marijuana and placed him in an accelerated rehabilitation program. Under that program, successful completion of a probationary term results in the dismissal of charges and their expungement from one's record.

On November 23, 1994, after a hearing, the arbitrator reinstated Barron without back pay or lost benefits. The arbitrator found that neither the assault nor the marijuana possession was just cause for discharge. The arbitrator's disposition of the assault charge is not challenged by the Home and is not the subject of this appeal. In finding no just cause for discharge on the ground of marijuana possession, the arbitrator referred to Barron's fourteen years of service "without any major disciplinary problems," Joint Appendix at 80, and to the state's decision to dispose of the criminal charges through the accelerated rehabilitation program. Moreover, in the course of making his findings of fact, the arbitrator specifically found that there was "no evidence that [Barron] was dealing to other employees or, for that matter, to anyone else." Id. at 70. The arbitrator did not award back pay or benefits for the period between Barron's discharge and the decision. Thus, effectively, the arbitrator found just cause for a seven month suspension without pay or benefits but not for permanent discharge.

Instead of reinstating Barron within 10 days after the award, as the award provided, the Home moved in district court on December 12, 1994, to vacate the award on two grounds: first, that the award was beyond the authority of the arbitrator under the CBA and, second, that it was contrary to public policy. The Union cross-moved to confirm the award. Almost two years later, on September 24, 1996, the district court granted the Union's motion confirming the arbitration award. The Home still did not reinstate Barron, and on the Union's motion, the district court held a contempt hearing. On October 21, 1996, the district court refused to hold the Home in contempt but ordered Barron's immediate reinstatement. The district court denied the Home's motion for a stay pending appeal. This appeal followed. On November 19, 1996, we denied the Home's motion for a stay. As of oral argument, Barron had not been reinstated.


On appeal, the Home asks us to reverse the district court's confirmation of the arbitrator's reinstatement award on the same two grounds asserted in the district court: (1) that the arbitrator lacked authority under the CBA to make the award, and (2) assuming such authority, that the award violated public policy. We consider each in turn.

A. Arbitrator's Authority.

The argument challenging the arbitrator's authority to render the award is easily disposed of. "The decision of an [arbitrator] hearing ... a dispute receives limited review: 'as long as the arbitrator is even arguably construing or applying the contract and acting within his scope of authority, that a court is convinced he committed error does not suffice to overturn his decision.' " Harry Hoffman Printing, Inc. v. Graphic Communications Int'l Union, Local 261, 950 F.2d 95, 98 (2d Cir.1991) (quoting United Paperworkers Int'l Union v. Misco, Inc., 484 U.S. 29, 38, 108 S.Ct. 364, 370-71, 98 L.Ed.2d 286 (1987)). The principal question for the reviewing court is whether the arbitrator's award " 'draws its essence from the collective bargaining agreement,' [since] the arbitrator is not free merely to 'dispense his own brand of industrial justice.' " In re Marine Pollution Serv., Inc., 857 F.2d 91, 94 (2d Cir.1988) (quoting United Steelworkers of Am. v. Enterprise Wheel & Car Corp., 363 U.S. 593, 597, 80 S.Ct. 1358, 1361, 4 L.Ed.2d 1424 (1960)).

When parties to an agreement bargain for an arbitrator's decision, that bargain may not be upset by a court simply because it deems the decision incorrect. See Leed Architectural Prods., Inc. v. United Steelworkers of Am., Local 6674, 916 F.2d 63, 65 (2d Cir.1990). The court may not substitute its view for that of the arbitrator nor may it even review the award for clear error. Id. When an "arbitrator[ ] explain[§ his] conclusions ... in terms that offer even a barely colorable justification for the outcome reached, confirmation of the award cannot be prevented by litigants who merely argue, however persuasively, for a different result." Andros Compania Maritima, S.A. v. Marc Rich & Co., A.G., 579 F.2d 691, 704 (2d Cir.1978).

Recognizing the sharply limited role of the courts in cases such as this, the Home argues that, in finding the absence of just cause for Barron's discharge, the arbitrator exceeded the scope of his authority. We disagree. The arbitrator acted within his broad authority both under the CBA and as framed by the two questions both sides put before him: "Was Ted Barron discharged for just cause? If not, what shall be the remedy?"

The Home points to passages in the arbitrator's opinion to the effect that Barron's marijuana offense is of a type "so serious that any employee may be properly expected to know without notice that such conduct is offensive and clearly punishable by discharge," and that Barron "was in possession of marijuana with intent to sell, a most serious offense which justifies discharge." Joint Appendix at 78, 80. From these, the Home argues that the arbitrator's decision amounted to an exercise of personal leniency which exceeded the scope of his authority. However, the Home overlooks later passages, in support of the arbitrator's conclusion that, in this instance, Barron's marijuana offense was not "just cause" for discharge. In particular, the arbitrator relied on several factors: (1) Barron's long-term employment at the Home; (2) the absence of any major disciplinary problems in his prior work history; (3) his amenability to rehabilitation; and (4) the fact that the state found him to be a candidate for its accelerated rehabilitation program. Id. at 80. For these reasons, the arbitrator concluded that "[t]he Home had just...

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