Sear v. Cadillac Auto. Co. of Boston

• Decision Date: 19 November 1980
• Docket Number: Civ. A. No. 78-3088-G.
• Citation: 501 F. Supp. 1350
• Parties: George SEAR et al., Plaintiffs, v. CADILLAC AUTOMOBILE COMPANY OF BOSTON et al., Defendants.
• Court: U.S. District Court — District of Massachusetts

501 F. Supp. 1350

George SEAR et al., Plaintiffs, v. CADILLAC AUTOMOBILE COMPANY OF BOSTON et al., Defendants.

Civ. A. No. 78-3088-G.

United States District Court, D. Massachusetts.

November 19, 1980.

Patricia Randall, Homans, Hamilton & Lamson, Gail Pennington, Boston, Mass., for plaintiffs.

Herbert H. Bennett, Lawrence C. Winger, Portland, Me., for Cadillac.

Philip T. Tierney, Dimento & Sullivan, Boston, Mass., for Metropolitan Auto Salesmen.

MEMORANDUM AND ORDERS DISMISSING COMPLAINT

GARRITY, District Judge.

This is a suit under § 301 of the Labor Management Relations Act (LMRA), 29 U.S.C. § 185 (1976), brought by plaintiff salesmen against their employer, defendant Cadillac Automobile Company of Boston ("the Company") for breach of contract and against their union, defendant Metropolitan Automobile Salesmen, Local 122 ("the Union") for breach of its duty of fair representation ("DFR"). Cross-motions for summary judgment were filed by the plaintiff salesmen and the defendant Company. We heard oral argument on the Company's motion for summary judgment on August 22, 1980. Later, on September 2, 1980, we issued a procedural order instructing the plaintiffs to file their cross-motion by September 18, and instructing both parties to address specific points of law raised in the August 22 hearing. Once those briefs were filed we issued a second procedural order instructing the parties to address the effect of the finality clause on plaintiffs' § 301 suit.

The principal question we address on these cross-motions is whether a provision for final and binding arbitration in a collective bargaining agreement bars an employee's suit against his employer for breach of contract under § 301, where the employer's alleged breach was the subject of arbitration untainted by misconduct of any party, and the only alleged breach of the Union's DFR is its bad faith failure to appeal the award. For reasons more fully explained below, we find the finality clause of this contract bars the employees' suit against the Company because the Union's alleged breach of its DFR-a bad faith failure to appeal the arbitrator's untainted award-does not "seriously undermine the integrity of the abritral process." Hines v. Anchor Motor Freight, Inc., 424 U.S. 554, 567, 96 S.Ct. 1048, 1057, 47 L.Ed.2d 231 (1976); see Anderson v. Grocers Supply Co., S.D.Tex., 1979, 483 F.Supp. 73, 77. As a corollary, we hold that as a matter of law, the Union's failure to appeal from a fairly conducted arbitration hearing is not a breach of its duty of fair representation. Hence, it is ordered that plaintiffs' claims against the Company and the Union¹ be dismissed.

Background

The facts leading up to and surrounding the arbitrator's award are generally undisputed by the parties. The troubles for the Company and the Union began back in March of 1977, when the Company announced plans to implement new sales procedures to improve performance and earnings. The announcement required the salesmen to attend daily training sessions. The salesmen, annoyed that this action was taken without their consultation, responded by letter stating that "Predicated on our experience with sales training schools in the recent past, we do not want to attend the sales classes ...." The Company replied by invoking the management rights clause of the collective bargaining agreement, stating that "this training is both beneficial to you as well as the Company ..." and that it "expects all salesmen to attend. Failure to do so will result in disciplinary action." The Company also told the Union stewards that any disagreement should be resolved through the grievance and arbitration process. After some informal negotiation and agreement between the parties, the salesmen attended the sessions held during the week of March 14. At the request of the business agent of the Union, however, a meeting was held on April 11 between Union and Company officials to discuss the new sales procedures. No agreement was reached, though the Company expressed its willingness to accept specific suggestions from the salesmen to improve the new selling system, short of abandoning it.

The Union steward called a meeting of the salesmen at about 8:00 p. m., that same evening. According to the arbitrator's report, the steward told the salesmen that the Company suggested using the grievance procedure and arbitration. The salesmen responded that they had waited six months to go to arbitration on another matter, and that they didn't want to wait that long-they felt they would all be fired in the interim.

The next morning, Tuesday, April 12, 1977, the salesmen picketed all the entrances to Boston Cadillac from 7:00 a. m. to 8:00 p. m., closing time. Approximately three hours after the stoppage began, the Company received the first formal, written grievance or request for arbitration. This was a mailgram from the Union's business agent, dated April 11 at 10:54 p. m., stating that:

After meeting with you for many hours today it was agreed that neither side could agree on the discussions regarding the sales method and other things. Therefore, this message will serve as a notice that we are going to trial for arbitration unless you can agree that this will be included in the arbitration that is pending.

Management did not respond to this communication.

The salesmen picketing the Company harassed Cadillac customers, kept other Company employees from working, and deliveries were not made. The Company responded to the strike by hand delivering letters to the picketing salesmen, on Tuesday, April 12, which stated:

This is to officially advise you that you are participating in an illegal work stoppage in violation of Article XV of the current labor agreement.

Unless you return to work on or before 9:00 a. m. on Wednesday, April 12, sic your employment with the Cadillac Automobile Company of Boston is terminated.

R. S. Hellawell General Manager

However, the salesmen did not return to work after receiving these letters, and continued to picket on Wednesday, April 13.

The Company came to this court on Wednesday afternoon to obtain a temporary restraining order against the picketing and stoppage. Judge Skinner issued the order at 3:12 p. m. that day, Cadillac Automobile Co. of Boston v. Metropolitan Automobile Salesmen, Union No. 122, D.Mass., 1977, C.A. No. 77-1057-S. Each striking salesman was personally notified of this order, but they all continued to picket until closing time, 9:00 p. m. The salesmen resumed picketing the next morning, Thursday, April 14, 1977, until they disbanded at about 10 to 10:30 a. m. When the salesmen attempted to return to work on Friday morning, April 15, the Company informed them that, as stated in the letter of April 12, their employment had been terminated on Wednesday morning, April 13.

The following Wednesday, April 20, both the Company and the Union appeared before Judge Skinner in connection with the temporary restraining order and the Company's complaint. At this hearing, with the approval of the court, the Union and the Company agreed to arbitrate the issues relating to the strike. However, the court reserved to itself determination of the question of damages, if any, suffered by the Company if the arbitrator found the strike to have breached the contract. The Company further agreed to permit the discharged salesmen to return to work the next day, Thursday, April 21, pending arbitration. The case was then continued.

Arbitration hearings were held before Professor Charles Myers, of M.I.T.'s Sloan School of Management, on September 29 and 30, 1977. The Union was represented by counsel, Union officials, and five of the fifteen plaintiff salesmen. Counsel for the Union filed a brief with the arbitrator after the hearing. Though the exact wording of the issues to be determined by the arbitrator was not settled at the April 20 hearing before Judge Skinner, the parties agreed that the arbitrator could draft the issues after the arbitration hearing. The arbitrator conferred with the Union and the Company about his proposed statement of issues, and subsequently issued a written opinion and award on November 10, 1977. He ruled, inter alia, that the salesmen's work stoppage and picketing was a strike in violation of Articles XV and VII of the collective bargaining agreement. Addressing the issue of whether "the management notices of April 12, 1977, to return to work by 9:00 a. m., April 13, or be terminated, were proper under the Agreement?" the arbitrator ruled that Articles VI, VII, XIV and XV of the Agreement gave him the authority to evaluate employer discipline "`up to and including discharge' in the light of the circumstances of the case." Hence, he found that (1) the discharge of the employees was "too severe a penalty," (2) the loss of pay for work days missed between April 12 and April 21 was an "insufficient penalty," and (3) that "each of the salesman is to be restored to employment under the Agreement, with no interruption of accumulated seniority and benefits (except for the period on strike and up to April 21), shall lose the equivalent of five times the amount of pay they lost during the strike, or 17 days (rounded off), to be determined for each individual by the company on the basis of payroll data ...."²

A dispute then arose between the Company and the Union over the computation of the fines, resulting in the issuance of a clarifying letter of arbitrator Myers dated December 8, 1977. Though that letter did not end this dispute, fines totalling approximately $20,000 were deducted from the paychecks of the salesmen who were still employed by the Company, and demands for payment of fines totalling approximately $2,500 were made of former employees. The Company, meanwhile, unhappy with the arbitrator's reinstatement of the temporarily discharged salesmen, appealed the arbitration award by filing a new action in this court, C.A. No. 77-3734-S. The complaint was never served...