Unite Here Local 1 v. Hyatt Corp.

• Decision Date: 06 July 2017
• Docket Number: No. 15-3668,15-3668
• Citation: 862 F.3d 588
• Parties: UNITE HERE LOCAL 1, Plaintiff-Appellee, v. HYATT CORPORATION, doing business as Hyatt Regency Chicago, Defendant-Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

862 F.3d 588

UNITE HERE LOCAL 1, Plaintiff-Appellee,

v.HYATT CORPORATION, doing business as Hyatt Regency Chicago, Defendant-Appellant.

No. 15-3668

United States Court of Appeals, Seventh Circuit.

ARGUED APRIL 4, 2017

DECIDED JULY 6, 2017

Rehearing and Rehearing En Banc Denied August 8, 2017

Margaret A. Angelucci, Attorney, ASHER, GITTLER & D'ALBA, Suite 1900, 200 W. Jackson Boulevard, Chicago, IL 60606-0000, David L. Barber, Attorney, MCCRACKEN, STEMERMAN & HOLSBERRY, LLP, Suite 800, 595 Market Street, San Francisco, CA 94105, Richard G. McCracken, Attorney, DAVIS, COWELL & BOWE, Suite 1400, 595 Market Street, San Francisco, CA 94105-0000, for Plaintiff-Appellee

Peter Andjelkovich, Attorney, Bradley J. Wartman, Attorney, PETER ANDJELKOVICH & ASSOCIATES, Suite 3950, 135 S. LaSalle Street, Chicago, IL 60603-0000, for Defendant-Appellant

Before Wood, Chief Judge, and Kanne and Rovner, Circuit Judges.

Rovner, Circuit Judge.

Defendant Hyatt Corporation, doing business as Hyatt Regency Chicago ("Hyatt" or the "hotel"), appeals the district court's entry of judgment on the pleadings in favor of plaintiff Unite Here Local 1 ("Local 1"), confirming the decisions of two arbitrators in Local 1's favor. Unite Here, Local 1 v. Hyatt Corp. , 2015 WL 7077329 (N.D. Ill. Nov. 13, 2015). Hyatt contends that the matter is either moot or does not present an appropriate case for confirmation of the awards, and that the district court's decision to confirm the awards needlessly interjects the court into an ongoing set of disputes between itself and Local 1 that should be resolved by way of further arbitration. We disagree and affirm the judgment. The district court's modest action in confirming the awards places the court's contempt power behind the prospective relief ordered by the arbitrators, while reserving the merits of any pending or future grievances for arbitration. Indeed, Local 1 has conceded that any contempt petition would be based solely on the outcome of arbitrations post-dating the district court's confirmation order. Consequently, we are not convinced that the court's decision to confirm the two awards in any way undermines the parties' agreement to resolve their disputes through arbitration. We therefore affirm the district court's decision.

I.

The Hyatt Regency Chicago is a convention hotel with over 2,000 guest rooms, five ballrooms, and between 80 and 100 meeting and event rooms. It employs approximately 1,200 people, 850 of whom are hourly employees belonging to the union. Local 1 represents the members of the bargaining unit, who include door and bell attendants; switchboard operators; room, house, and public area housekeeping attendants; linen throwers and attendants; food and beverage hostesses, servers, bussers, cooks, bartenders, and cafeteria attendants; convention housemen; and various other workers. The size of the hotel's facilities and workforce enable it to host up to 10,000 guests at a time and thus to handle some of the city's largest professional conclaves and other gatherings.

Hyatt and Local 1 are parties to a longstanding collective bargaining agreement, the current version of which is effective from September 1, 2013 through August 31, 2018 (the "CBA" or "agreement"). Section 56 of that agreement prohibits the hotel's 140 managerial employees from performing work normally performed by bargaining-unit employees absent an emergency. R.1-1 at 48.¹ Section 46 of the CBA sets forth a multi-step grievance procedure for the resolution of disputes between the parties, and section 45 provides for the arbitration of any disputes over the interpretation or alleged violations of any terms of the agreement not resolved by the grievance procedure. In the second half of 2013 and the first part of 2014, there were a number of incidents in which managers performed bargaining-unit work in circumstances that Local 1 did not regard as emergencies. The union took two sets of grievances on that subject to arbitration in the Fall of 2014, both of which resulted in awards in Local 1's favor.

In an award dated February 2, 2015, arbitrator George R. Fleischli found that Hyatt had violated section 56 by permitting managers to perform work normally done by housemen in the convention services department of the hotel. Housemen perform the tasks necessary to set up meeting rooms and ball rooms for the particular types of events scheduled for those rooms: they bring the appropriate types of tables into the rooms, arrange chairs around them, place linens on the tables if necessary, establish water and refreshment stations, and set up any podiums, stages, or dance floors that might be required. When an event has concluded, they then break down the room and set it up for the next event. Local 1 alleged that on some 17 occasions from September 2013 through June 2014, supervisors took on tasks that they should have left to housemen, including: setting up tables, replacing tables that had already been set up, straightening or adjusting chairs, placing drinking glasses on tables, setting up or moving special "highboy" cocktail tables, breaking down tables, stacking chairs, cleaning up trash, and so forth.

As a threshold matter, arbitrator Fleischli rejected the hotel's dual contentions that there was an established practice of "shared work" between housemen and supervisors that envisioned them both working side by side as necessary to set up and break down event rooms and, relatedly, that the individuals supervising housemen were "working supervisors" whose job responsibilities included pitching in as necessary to complete tasks. The evidence, in the arbitrator's view, simply did not support the existence of a consistent practice in either respect. (In the concluding section of his decision, he did allow that there had been lax enforcement of section 56 in the convention services department of the hotel for many years which had effectively permitted supervisors in that department to violate the rule unchecked.)

On examining the terms of section 56, arbitrator Fleischli concluded that it was not self-evident what constituted an "emergency" that would permit supervisors to step in and perform tasks that were otherwise assigned to housemen. He rejected Hyatt's contention that the term should be defined simply as a set of unforeseen circumstances. Having weighed the parties' competing arguments on this point, Fleischli concluded that an "emergency" was properly defined as unforeseen circumstances that require immediate action, including in particular the need for the hands-on intervention of supervisors when bargaining-unit members are not reasonably available to take care of the urgent task at hand.

Ultimately, arbitrator Fleischli found that the union's grievances were arbitrable (i.e. , properly preserved and presented for decision) as to five of the incidents cited, and he concluded that Hyatt had violated section 56 in three of those incidents. The proven violations were relatively minor, in his view, but at least in the first two of the incidents, they were not de minimis. Fleischli declined to order make-whole relief in the form of backpay given the history of lax enforcement of section 56 in the department, but he did order Hyatt to cease and desist from further violations of section 56 and to take such steps as were necessary to ensure that hotel managers complied with the provision in the future.

In a second award dated March 1, 2015, arbitrator Ann S. Kenis likewise found that Hyatt had violated section 56 on multiple occasions. Arbitrator Kenis addressed a broader range of circumstances than had her colleague. She was presented with two grievances. The first involved supervisors doing work normally performed by bell attendants (also know as bellmen), including the receipt and storage of guest luggage, retrieving checked bags for guests, and loading luggage into guest vehicles. These incidents occurred in the Fall of 2013. The second, more general grievance involved bargaining-unit employees from multiple hotel departments and was based on supervisors performing any number of tasks (beginning on or about March 13, 2014 and continuing thereafter), including: cleaning (e.g. , mopping or sweeping floors, using mechanical ride-on "chariots" to clean ballroom or public area carpets, cleaning the front doors of the hotel, and emptying trash cans in public areas); serving guests in the hotel restaurants, café, and employee cafeteria (e.g. , seating guests, pouring drinks, making coffee, bussing tables, stocking the buffet, handing out condiments, working the cash register, wiping counters); transporting food, beverages, and dishes to and from ballroom banquets; loading soiled linens into the hotel laundry chute; and helping to clear rooms after events (e.g. , picking up trash, removing special items like ice sculptures, and so on).

Upon review of the evidence and the parties' arguments as to the proper construction of section 56, arbitrator Kenis agreed with arbitrator Fleischli as to certain key points. First, she found insufficient evidence to support Hyatt's contention as to a practice of shared work responsibilities between bargaining-unit employees and their supervisors or as to a practice of "working supervisors" who routinely pitched in to help the line employees they supervised. Second, she agreed with her colleague that the term "emergency" connotes more than just unforeseen circumstances, as Hyatt had suggested. Kenis noted that in the arbitration context, another arbitrator's interpretation of "emergency" was neither conclusive nor binding upon her. Yet, she believed that she should not disregard arbitrator Fleischli's reasoning absent substantially altered circumstances, which Hyatt had not established. In that regard, arbitrator Kenis noted that although Hyatt had attempted to convince her that there was a longstanding, uniform practice of managers doing bargaining-unit work whenever unforeseen circumstances presented themselves, s...