TRUCK DRIVERS, ETC. v. STEARLY MOTOR FREIGHT

• Decision Date: 02 August 1982
• Docket Number: Civ. A. No. 79-633.
• Parties: TRUCK DRIVERS, CHAUFFEURS AND HELPERS, LOCAL UNION NO. 384 v. STEARLY MOTOR FREIGHT, INC., Rex Motor Freight, Inc., and William A. Kelly, Inc.
• Court: U.S. District Court — Eastern District of Pennsylvania

544 F. Supp. 623

TRUCK DRIVERS, CHAUFFEURS AND HELPERS, LOCAL UNION NO. 384 v. STEARLY MOTOR FREIGHT, INC., Rex Motor Freight, Inc., and William A. Kelly, Inc.

Civ. A. No. 79-633.

United States District Court, E. D. Pennsylvania.

August 2, 1982.

William J. Einhorn, Sagot & Jennings, Philadelphia, Pa., for plaintiff.

Michael F. Kraemer, Kleinbard, Bell & Brecker, Philadelphia, Pa., for defendants.

MEMORANDUM

RAYMOND J. BRODERICK, District Judge.

The plaintiff, Truck Drivers, Chauffeurs and Helpers, Local Union No. 384 ("Local Union") brought this action pursuant to § 301(a) of the Labor Management Relations Act to enforce two arbitration awards rendered by a joint employer-employee arbitration panel. In its original complaint, only Stearly Motor Freight, Inc. ("Stearly") was named as a defendant. The Local Union filed an amended complaint several months after its original complaint, seeking to enforce the awards not only against Stearly, but also against Rex Motor Freight, Inc. ("Rex") and William A. Kelly, Inc. ("Kelly"). Now before this Court are the defendants' motions for summary judgment. The defendants claim that the awards cannot be enforced against Rex and Kelly because they were not named in either the plaintiff's submission to the arbitration panel or in the panel's awards. The defendants also claim that the plaintiff is seeking in this action to enlarge one award to include cost of living increases for 1977 when, in fact, the award only covered increases for 1978, and that, even as to Stearly, this award may only be enforced for 1978. For the reasons hereinafter set forth, summary judgment will be granted in favor of the defendants Rex and Kelly. As to the cost of living issue, the award should be resubmitted to the arbitration panel to clarify an ambiguity which at present renders the award unenforceable.

For many years, the Local Union and Stearly have been parties to a collective bargaining agreement which is renewable every three years and which provides that unresolved grievances be submitted to a joint employer-union arbitration panel. The decisions of the panel are final and binding upon all the parties. On May 24, 1978 the plaintiff submitted to arbitration a grievance in which it claimed that Stearly had not paid cost of living allowances as provided by the collective bargaining agreement. The submission did not unambiguously state which years the grievance referred to, and the award of July 21 merely states that "Based on the facts presented the Company will pay the Cost of Living, pertaining to Art. 33 of the Master Freight Agreement." In August, 1978 the plaintiff filed a grievance on behalf of one of its employees in which it was alleged that he was not afforded an opportunity to work in accordance with the seniority provisions of the agreement, and that he was entitled to lost wages for the period he was not working. On December 13, 1978 the arbitration committee upheld the union's grievance on behalf of this employee. In its action before this Court, the Local Union now seeks to enforce these awards against Stearly, Rex, and Kelly, the former award for the years 1977 and 1978. The defendants Rex and Kelly claim in their motions for summary judgment that they are not bound by the arbitration awards because they were not parties to the arbitration and the issue as to whether they were an "employer" under the agreement was not arbitrated. The defendant Stearly, in its motion for summary judgment contends that the arbitrator's award as to the cost of living allowance may only be enforced against it for the year 1978.

The plaintiff's argument that the awards should cover all three defendants is based on its belief that Stearly, Rex, and Kelly are a "single employer". The Local Union states that Douglas Stearly, his wife, and his son own all of the stock in the three companies; that all three entities share common physical facilities; that Mr. Stearly and his wife manage all the companies, including their labor relations; that the records of all the companies are kept in a single location; that the companies share one phone; that the clerical staff that performs work for all the companies is paid only by Stearly Motor Freight, Inc.; and that truck drivers, regardless of which company they are paid by, work interchangeably for all three companies.

It is true, as the plaintiff has pointed out, that the National Labor Relations Board and the courts have construed the term, "employer," broadly, and in doubtful situations, have looked to underlying economic facts rather than technical legal classifications. NLRB v. Hearst Publications, 322 U.S. 111, 128-29, 64 S.Ct. 851, 859, 88 L.Ed. 1170 (1944). Substance has prevailed over form, and even though a corporation is not a party to a collective bargaining agreement between a union and a related corporation, the former corporation may nevertheless be bound to extend the agreement to its own employees, provided that both corporations are operated essentially as a single entity. Radio & TV Local 1264 v. Broadcast Service, 380 U.S. 255, 85 S.Ct. 876, 13 L.Ed.2d 789 (1965); Local No. 627 v. NLRB, 518 F.2d 1040 (D.C.Cir.1975). Among the criteria to be used in determining whether nominally separate entities constitute a single employer are the degree of interrelation of operations, common management, centralized control of labor relations, and common ownership. Id. Arguably, Stearly, Rex, and Kelly could be found to constitute a single employer.

Nevertheless, we hold that Rex and Kelly are entitled to summary judgment. Although Rex and Kelly might well have been required to honor the collective bargaining agreement between the Local Union and Stearly, the plaintiff never raised this issue in the arbitration proceedings. The plaintiff here contends that, because of the single employer status of the companies, it was unnecessary to include the names of Rex and Kelly in its submission to arbitration, and that the award must apply to these parties without their having been named in it. We cannot, however, enforce an award which has not been made, nor is it within our province to make a de novo determination of whether Rex and Kelly are parties to the award where the issue has not been decided by the arbitrators.

We have found no cases which support the proposition that, after an award has been made, it can be enforced against parties not named in the award or dealt with in the arbitration proceeding. The cases we have uncovered dealing with "single employer" status are all suits to compel non-signatories to participate in arbitration proceedings. Thus, these suits arise before the award is made. See, e.g., Farkar Co. v. R. A. Hanson Disc, Ltd., 583 F.2d 68, 70-71 (2d Cir. 1978); Interocean Ship. Co. v. National Ship. & Trading Corp., 523 F.2d 527, 538-39 (2d Cir. 1975); Wells Fargo Bank v. London S. S. Owners Mut. Ins., 408 F.Supp. 626 (S.D.N.Y.1976); Andrew Martin Marine v. Stork Werkspoor Diesel, 480 F.Supp. 1270 (E.D.La.1979); Koreska v. Perry-Sherwood Corp., 253 F.Supp. 830 (S.D.N.Y.1965), affirmed 2 Cir., 360 F.2d 212.

The undisputed facts are that only the name of Stearly was submitted in the union's grievance and that the award only mentioned "the Company," that is, Stearly. At the hearing, the other companies were not represented, were never discussed or mentioned, and no testimony was adduced concerning their affiliated nature. Therefore, in a suit to enforce the award rendered by the arbitration panel, this Court has no authority to bind Rex...