United Steelworkers of America, Local 4839 v. New Idea Farm Equipment Corp.
| Decision Date | 29 October 1990 |
| Docket Number | No. 89-3912,89-3912 |
| Citation | 917 F.2d 964 |
| Parties | 135 L.R.R.M. (BNA) 2880, 117 Lab.Cas. P 10,395 UNITED STEELWORKERS OF AMERICA, LOCAL 4839, Plaintiff-Appellant, v. NEW IDEA FARM EQUIPMENT CORPORATION, Defendant-Appellee. |
| Court | U.S. Court of Appeals — Sixth Circuit |
David M. Cook (argued), Kircher & Phalen, Cincinnati, Ohio, for plaintiff-appellant.
R. Jeffrey Bixler, Cooper, Straub, Walinski & Cramer, Toledo, Ohio, Mark E. Furlane (argued), Charles A. Freeman, The Quaker Oats Co., Chicago, Ill., for defendant-appellee.
Before MARTIN and NELSON, Circuit Judges, and LIVELY, Senior Circuit Judge.
The district court entered summary judgment for the employer in this action to enforce an arbitration award, and the union appeals. The employer did not seek to vacate or amend the arbitrator's award, but reimbursed the discharged employee for lost earnings and benefits in accordance with its interpretation of the award. The union disagreed with that interpretation and brought this action, asserting that the employer had failed to comply fully with the award. The district court agreed with the employer's construction of the award and dismissed the complaint. We affirm in part and vacate in part.
New Idea Farm Equipment Corporation (the employer) discharged Charles Friday, a long-time employee, and United Steelworkers of America, Local 4839 (the union) filed a grievance. After the prescribed grievance proceedings failed to produce a settlement, the matter was submitted to an arbitrator in accordance with a provision of the collective bargaining agreement then in force. The parties jointly stipulated that the only issues in the case were whether the employer had just cause to terminate Charles Friday and, if not, what remedy should be applied.
After conducting a hearing the arbitrator filed an "Opinion and Award," in which he made findings and concluded that Friday had engaged in misconduct that justified disciplinary measures, but that discharge was excessive punishment. The award, in its entirety, states:
For all of the above reasons, it is determined that the Company did not have just cause to terminate Charles Friday on February 23, 1988. Termination is reduced to a thirty calendar day suspension, during which time the Grievant shall forfeit wages and benefits. The Grievant shall be offered reinstatement as soon as practical following receipt of this Opinion and Award. Charles Friday shall also be made whole for straight time earnings and benefits that would have been payable thereafter, less, however, interim earnings and Unemployment Compensation received but not refunded.
The employer promptly reinstated Friday and computed his "straight time earnings" for the period beginning 30 days after his discharge and ending with his reinstatement. The employer calculated these earnings on the basis of an eight-hour day and five-day week. New Idea's calculations yielded lost "straight time earnings" of $12,529.76.
From the "straight time earnings" the employer deducted $5,951.25 as "interim earnings" from an insulation business that was run by Friday. At the arbitration hearing, Friday testified that he had operated the insulation business for 18 years while working with New Idea and previous employers. After the hearing, the employer requested and the union provided a statement of the net income earned by Friday from the insulation business during the time for which he was entitled to recover lost earnings. The amount deducted as "interim earnings" was based on the statement provided by the union.
The union disputed two of the employer's assumptions and offered a different calculation that would have increased Friday's reimbursement significantly. The union contended that Friday was entitled to all wages that he lost, including wages for the overtime he would have worked as well as for the regular forty-hour week. In addition, the union asserted that the employer was not entitled to deduct the entire net income from the insulation business during the time Friday was wrongfully terminated. The union argued that "interim earnings" referred only to earnings from the insulation business that were in lieu of wages from New Idea. Since Friday had earned income from the business while employed by New Idea, such "supplementary earnings" were not deductible.
The parties were unable to agree on these two issues and the union brought this action in district court.
The union argued in the district court that the award contained a "make whole" provision that required the employer to pay for all lost time. Accordingly, "straight time earnings" referred to the rate of pay, not to the hours of work for which Friday was entitled to be paid. The employer, on the other hand, maintained that "straight time earnings" required payment only for lost straight time at the regular rate of pay. With respect to the deduction of "interim earnings," the union contended that only those earnings that replaced lost wages should be counted, not those that Friday would have taken in even if he had remained employed by New Idea. The employer argued that the arbitrator heard Friday's testimony concerning the insulation business and did not qualify in any way the requirement that "interim earnings" be deducted. Thus, all earnings during the relevant period were properly deducted. Finally, the union argued that, at best, the award was ambiguous with respect to these two issues, and requested a remand to the arbitrator for clarification. To the contrary, the employer maintained that the award was unambiguous.
The district court noted that under the applicable Ohio statute the time had expired for either party to bring an action to vacate, modify or correct the award. Thus, the court found that its jurisdiction was "limited to enforcement of the award according to its terms." In determining that the employer had fully complied with the award the court stated that it did not "find the disputed language to be ambiguous or particularly difficult to understand." The award did not require interpretation beyond the plain meaning of the language employed by the arbitrator. The court concluded that " 'straight time earnings' means hourly rate times 40 hours per week and that 'interim earnings' means all interim earnings, including earnings from self-employment."
Also, without citation of authority, the district court stated that it did not have the option to remand to the arbitrator. This conclusion apparently was based upon the finding that there had been no timely action to vacate, modify or correct the award.
The parties have repeated their district court arguments on appeal, with some variations. The union emphasizes the award's requirement that Friday "be made whole for straight time earnings and benefits that would have been payable thereafter." If he had not been discharged, the union states, Friday would have worked some overtime hours in addition to the regular 40-hour week. Thus, to be made whole for the "earnings and benefits that would have been payable thereafter" he must be paid for the overtime hours he would have worked as well as for the regular work-week. The union also argues more forcefully on appeal for a remand to the arbitrator as an alternate remedy and disputes the district court's determination that it lacked authority to make such a remand.
The employer contends that the union's failure to file this action within 90 days after entry of the award barred all relief. It argues that in reality this was an action to vacate the arbitration award and substitute a new one adding overtime pay and eliminating the deduction of Friday's income from the insulation business as "interim earnings."
The employer also argues that the district court's interpretation of the award was clearly correct. If the arbitrator had intended to cover only the rate of pay and not the hours for which Friday was to be paid, he would have used "straight-time rate of pay" as employed in the collective bargaining agreement rather than "straight time earnings" to describe the payment to which Friday was entitled. Further, the award required the deduction of "interim earnings" without qualification.
Finally, the employer asserts that there is no ambiguity in the award. An award may be remanded to an arbitrator for clarification, the employer maintains, only if the ambiguity is "patent, glaring, or apparent on [its] face." Here, the union is trying to create an ambiguity that is not apparent on the face of the award.
We will deal with the various arguments of the parties in sequence, looking first at two procedural questions.
The district court was not required to dismiss the union's complaint as untimely filed. This action was filed under section 301 of the Labor Management Relations Act, 29 U.S.C. Sec. 185, which does not contain a limitations provision. Thus, timeliness is determined by reference to the appropriate state statute of limitations. United Auto Workers v. Hoosier Cardinal Corp., 383 U.S. 696, 704-05, 86 S.Ct. 1107, 1112-13, 16 L.Ed.2d 192 (1966). The appropriate statute of limitations in an Ohio case seeking to vacate, modify or correct an arbitration award is Ohio Revised Code (O.R.C.) Sec. 2711.13, which provides a three-month period for such an action. D'Andrea v. American Postal Workers Union, 700 F.2d 335, 337 (6th Cir.1983). On the other hand, O.R.C. Sec. 2711.09 provides a one-year period for bringing an action to confirm an award. Thus, the proper characterization of the action determines its timeliness.
We find that in the present case, the union did not seek to vacate, modify or correct the award. It did not take issue with the arbitrator's decision that the employer did not have just cause to terminate Friday and that only a 30-day suspension was warranted. Instead, the union contended that the employer had complied only partially with the award,...
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