1995 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

5-24-1995

UPS v Int'l Brotherhood Tmstr.

Precedential or Non-Precedential:

Docket 94-7224

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Recommended Citation

"UPS v Int'l Brotherhood Tmstr." (1995). 1995 Decisions. Paper 143.

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 UNITED STATES COURT OF APPEALS 

 FOR THE THIRD CIRCUIT 

 

 No. 94-7224 

 

 UNITED PARCEL SERVICE, INC., 

 Appellant 

v. 

 INTERNATIONAL BROTHERHOOD OF TEAMSTERS, 

 CHAUFFEURS, WAREHOUSEMEN AND HELPERS 

 OF AMERICA, LOCAL UNION NO. 430 

 

 On Appeal from the United States District Court 

 for the Middle District of Pennsylvania 

 (D.C. Civ. Action No. 93-cv-00807) 

 

 

 Argued: September 19, 1994 

 Before: GREENBERG, ROTH and ROSENN, Circuit Judges

 (Opinion Filed May 24, 1995) 

 

Martin Wald, Esquire (Argued) 

Nicholas N. Price, Esquire 

Axel J. Johnson, Esquire 

Schnader, Harrison, Segal & Lewis 

1600 Market Street, Suite 3600 

Philadelphia, PA 19103 

 Attorneys for Appellant 

Ira H. Weinstock, Esquire 

Jason N. Weinstock, Esquire (Argued) 

Ira H. Weinstock, P.C. 

800 North Second Street, Suite 100 

Harrisburg, PA 17102 
 Attorneys for Appellee 

 

 

 

 OPINION OF THE COURT 

 

ROTH, Circuit Judge: 

 This appeal requires us to determine whether a portion 

of an arbitration award should be struck down on the ground that 

the arbitrator exceeded the scope of his authority. Because we 

find that the arbitrator's response did not exceed the scope of 

the question presented, we will affirm the district court's 

decision upholding the arbitration award. 

I. 

 The facts of the case are undisputed. On or about 

February 7, 1992, United Parcel Service ("UPS") discharged Thomas 

Varish for poor work performance. Thereafter, the International 

Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers, 

Local Union No. 430 (the "Union") filed a grievance on behalf of 

Varish under the procedures set forth in the parties' collective 

bargaining agreement (the "Agreement"). After UPS and the Union 

were unable to reach an accord with respect to Varish's 

discharge, the parties submitted the dispute to the Central 
Pennsylvania Area Parcel Grievance Committee (the "Joint Panel" 

or "Panel")1, as required by the Agreement. 

 At the hearing before the Joint Panel, the Union 

representative presenting Varish's case raised a Point of Order 

challenging UPS's attempt to introduce into evidence notations of 

informal disciplinary actions previously taken against Varish. 

These informal actions are typically referred to as "talk-with's" 

and "talk-to's," which are verbal reprimands or comments, or 

"write-up's," which are written records of reprimands or 

comments.2 The Panel considered the Point of Order, but could 

not resolve the issue. Accordingly, the Panel issued the 

following decision: 

A Point of Order was raised and Executive Session was 

called. The Panel deadlocked on the Point of Order. 

The question is whether [UPS] may enter into the 

record, "talk-with's," "talk-to's" or "write-up's" 

which [sic] the Union had no prior knowledge. 

 As required by the parties' Agreement, the parties 

submitted the Point of Order to an arbitrator. After hearing two 

days of testimony and reviewing post-arbitration briefs, 

 

 1The Joint Panel is composed of equal numbers of UPS and 

Union representatives. The Union representatives cannot be from 

the local Union involved in the dispute, and the UPS 

representatives cannot be from the UPS district involved in the 

dispute. Thus, the local Union and UPS district present their 

cases to a disinterested panel. Appendix ("App.") at 77. 

 

2For the purposes of this opinion, we will refer to all three 

categories of informal actions as "talk-to's." 
Arbitrator Eli Rock rendered an award and opinion in this matter. 

The two paragraph award reads as follows: 

1. On the general question of the admissibility of 

talk-to's and the like before the Joint Panel where the 

Union members object, the ruling is that such material 

may not be admitted over the objection of the Union 

members. 

2. In the present particular case involving employee 

Varish, and limited to the present submission to 

arbitration, the disputed material may be admitted. 

 In his memorandum detailing his decision, Arbitrator 

Rock explained his analytical process as follows: 

 Addressing myself to [the Point of Order], it 

appears to me that I have no choice, in this case but 

to break down the issue into the broader and general

question of [UPS]'s right to introduce "talk-with's" 

and the like over the Union's objections, and secondly

[UPS]'s right to do so in the present specific case, 

involving grievant Tom Varish. 

App. at 59. In the context of the question presented, i.e., the 

admissibility of talk-to's of which the Union had no prior 

knowledge, the arbitrator, in making his first "general" ruling, 

gave "significant weight" to the past practice of the parties. 

He found it to be "completely clear . . . that where the Union 

members have opposed the admission of `talk-to's,' and have stuck 

to that position, such items have not been entered in the 

record." (Id. at 60).3 In regard to this particular case, 

 

 

3Some confusion exists in the record concerning the scope of 

Arbitrator Rock's award. This confusion arises because, in the 

decision accompanying the arbitrator's award, Arbitrator Rock 

references objections raised by "Union panel members." See App. 

60-61. However, the question presented to the Arbitrator 

involved objections raised by Union members, not Union panel 
however, the arbitrator determined that both Varish and the Union 

had had prior knowledge of the talk-to's. Id. at 61. The 

arbitrator found therefore in his second paragraph that the talkto's here should have been admitted. 

 UPS sought to vacate paragraph one of the arbitrator's 

award, arguing that the arbitrator exceeded the contractual 

limitations on his authority by ruling on an issue not submitted 

for arbitration and by altering the parties' underlying 

Agreement.4 The parties filed cross-motions for summary 

judgment, and the district court entered an order granting the 

Union's motion and denying UPS's. This appeal followed.5 

 

members. Because the arbitrator's decision and award must be 

considered in light of the question presented, and because the 

award itself is free from any ambiguity in language, we find that 

the arbitrator's award properly addressed objections raised by 

Union members. 

 

4It should be noted that the parties have not appealed the 

arbitrator's second finding, namely that, in Varish's specific 

case, the disputed material was admissible. 

 

5On appeal, UPS also raises, for the first time, a public 

policy challenge to paragraph one of the arbitrator's award. It 

is the general rule that issues raised for the first time at the 

appellate level will not be reviewed. See, e.g., Singleton v. 

Wulff, 428 U.S. 106, 120 (1976); Hormel v. Helvering, 312 U.S. 

552, 556 (1941). Even were this Court to exercise its discretion 

and reach the issue, however, UPS's public policy challenge to 

paragraph one would clearly fail. 

 Although a court may refuse to enforce an arbitrator's 

interpretation of a collective bargaining agreement if the 

interpretation "explicitly conflict[s] with well-defined, 

dominant public policy," Stroehmann Bakeries, Inc. v. Local 776, 

International Brotherhood of Teamsters, 969 F.2d 1436, 1441 (3d 

Cir.), cert. denied, 113 S.Ct. 660 (1992), UPS fails to 

articulate a well-defined public policy violated by paragraph one 

of the award, particularly when the award is interpreted, as we 
II. 

 We exercise plenary review of the district court's 

decision resolving cross-motions for summary judgment. See

Stroehmann Bakeries, Inc. v. Local 776, International Brotherhood 

of Teamsters, 969 F.2d 1436, 1440 (3d Cir. 1992), cert. denied, 

113 S.Ct. 660 (1992). 

III. 

 It is well settled that courts have limited power to 

review a labor arbitrator's award. Where, as here, the parties' 

collective bargaining agreement provides for binding arbitration 

in grievance proceedings, courts are not authorized to reconsider 

the merits of an arbitrator's award. A contrary rule would 

undermine the federal policy which favors settling labor disputes 

through arbitration. See United Paperworkers International Union 

v. Misco, Inc., 484 U.S. 29, 36 (1987); United Steelworkers of 

America v. Enterprise Wheel & Car Corp., 363 U.S. 593, 596 

(1960). Therefore, an arbitrator's award will be upheld so long 

as it "draws its essence from the collective bargaining 

agreement," Misco, 484 U.S. at 36; Enterprise Wheel, 363 U.S. at 

597, unless the award is tainted by fraud or bias or addresses 

matters outside the arbitrator's authority. High Concrete 

Structures, Inc. v. United Electrical, Radio & Machine Workers, 

Local 166, 879 F.2d 1215, 1218 (3d Cir. 1989); see also Mobil Oil 

 

do here, to exclude only talk-to's about which the Union had no 

prior knowledge. 
Corp. v. Independent Oil Workers Union, 679 F.2d 299, 302 (3d 

Cir. 1982) ("[A]n arbitrator must not exceed his authority and 

dispense his own brand of industrial justice."). 

 UPS raises two intertwined issues in its appeal: that 

paragraph one of the arbitrator's award exceeds the scope of his 

authority and that it does not draw its essence from the parties' 

collective bargaining agreement.6 UPS argues that we should not 

uphold paragraph one of the award because the arbitrator failed 

to confine his inquiry to the "grievance coming before him," 

namely the admissibility of talk-to's about which the Union had 

no prior knowledge. In UPS's view, paragraph one of the award 

holds that all talk-to's, regardless of whether the Union had 

prior knowledge, may not be admitted over the objection of the 

Union members. 

 In support of this interpretation, UPS cites two 

passages contained in Arbitrator Rock's memorandum accompanying 

the arbitration award. First, UPS points to a passage in which 

Arbitrator Rock states that "[t]he Union panel members could in a 

specific future case simply object to the introduction of `talk-

 

 

6Under Article 48, Section 2 of the parties' Agreement: 

The arbitrator shall have the authority to apply the 

provisions of this Agreement, and to render a decision 

on any grievance coming before him, but shall not have 

the authority to amend or modify this Agreement or 

establish new terms and conditions under this 

Agreement. 

(emphasis added). 
to's' as such, without regard to the prior processing or handling 

of such material, and given the above past practice [of the Joint 

Panel] and the weight that I have given to it, this would be 

sufficient to bar the introduction of such material." App. at 

61. UPS argues that, in using this language, the arbitrator 

ruled on the admissibility of all talk-to's, whether or not the 

Union had had prior knowledge of them, and therefore the 

arbitrator exceeded the scope of his authority. 

 UPS also points to references in Arbitrator Rock's 

memorandum to objections raised by "Union panel members" (App. at 

60-61) as evidence that the arbitrator exceeded his authority. 

UPS properly contends that the question presented to Arbitrator 

Rock did not involve objections raised by union panel members, 

but rather by union members appearing before the panel.7

 A review of Arbitrator Rock's award, however, persuades 

us that the award did not exceed the scope of his authority and 

that thereby, pursuant to Article 48, Section 2 of the parties' 

agreement, the award drew its essence from the agreement. To 

begin with, it is crucial to consider the arbitrator's award in 

light of the question presented. Accordingly the arbitrator's 

award should be read to address only those talk-to's of which the 

Union did not have prior knowledge and only those objections 

raised by Union members. 

 

 

7See footnote 3, supra. 
 Additionally, UPS's interpretation of paragraph one of 

the award is not suggested by the language of the award itself. 

In drawing the inference that paragraph one exceeds the scope of 

the question presented, UPS relies solely upon the language 

contained in the arbitrator's accompanying opinion. The Supreme 

Court, however, has clearly held that ambiguity in an opinion 

accompanying an award is not a reason for determining that an 

award is unenforceable as beyond the scope of the arbitrator's 

authority. United Steelworkers of America v. Enterprise Wheel & 

Car Corp., 363 U.S. 593, 598 (1960). Instead, when an award does 

not apparently exceed the scope of the parties' submission, it 

will be affirmed, regardless of inferences that may be drawn from 

the accompanying opinion. Id. Such an award will, of course, be 

enforceable only to the extent it does not exceed the scope of 

the parties' submission. Thus, given two reasonable 

interpretations of the award, only that which is within the 

authority of the arbitrator will be enforceable. 

 In the instant case, the arbitrator's award, on its 

face, does not contain any language indicating that it extends 

beyond the scope of the question presented. Rather, paragraph 

one is logically read as a direct response to the parties' 

submission, pertaining only to talk-to's about which the Union 

had no prior knowledge.8 Accordingly, the award is not beyond 

 

 

8Not only is this a logical reading of the award, but it is 

also a preferable reading insofar as it eliminates the inherent 

contradiction found in the parties' suggested reading of the 

award. Specifically, if paragraph one of the award were read to 
the scope of the arbitrator's authority under the parties' 

Agreement. 

 The judgment of March 24, 1994, will be affirmed. 

RE: UNITED PARCEL SERVICE, INC. APPELLANT v. INTERNATIONAL 

BROTHERHOOD OF TEAMSTERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS, 

LOCAL UNION NO. 430, APPELLEE, No. 94-7224 

 

ROSENN, Circuit Judge, Dissenting. 

 This appeal stems from an arbitration proceeding held 

in response to a specific submission by the parties. The 

submission simply asked the arbitrator to decide a procedural 

question relating to the admissibility of notations of prior 

informal disciplinary actions ("talk to's") taken against a 

discharged employee at a hearing before a joint mediation panel 

considering the discharge of that employee. The submission by 

the Joint Panel asked "whether the Company may enter into the 

record [before the Panel] 'talk-withs,' 'talk-to's' or 'writeups' which [sic] the Union had no prior knowledge." (Emphasis 

added). 

 The arbitrator decided that "[i]n the present 

particular case . . . and limited to the present submission to 

 

mean that all talk-to's are inadmissible upon the Union's 

objection, paragraph two's holding that the talk-to's in the 

present case are admissible would be rendered illogical and 

inconsistent. 
arbitration, the disputed material may be admitted." The 

arbitrator concluded that the Union had had prior knowledge of 

the talk-to's and that therefore, they were admissible. The 

Union's prior knowledge was critical to the arbitrator's decision 

because it was an integral part of the issue submitted for 

arbitration. The parties do not dispute the disposition of the 

specific submission. 

 The arbitrator, however, captiously decided another 

question that was neither submitted nor authorized, paragraph one 

of his award. That paragraph provided: 

 1. On the general question of admissibility 

of talk-to's and the like before the Joint 

Panel where the Union members object, the 

ruling is that such material may not be 

admitted over the objection of the Union 

members. 

 This conflicts with paragraph two,9 exceeds the scope 

of the submission and does not draw its essence from the parties 

collective bargaining agreement. Thus, I believe that paragraph 

one of the arbitrator's award must be vacated, the judgment of 

the district court reversed, and the case remanded to the 

 

 

9Paragraph two's finding that the talk-to's are admissible 

makes no sense in light of paragraph one's conclusion that talkto's are never admissible if the Union objects. Judge Roth cites 

this inconsistency as support for her conclusion that paragraph 

one refers only to talk-to's which the Union does not know about 

prior to the hearing. 

 I believe that the plain language of these two paragraphs 

reveals an inherent inconsistency and that the only way to 

eliminate that inconsistency is to vacate paragraph one. 
district court with directions to enter summary judgment on 

behalf of the appellant. I therefore respectfully dissent. 

I. 

 In paragraph one, the arbitrator plainly states that 

talk-to's are never admissible over the Union member's objection. 

The district court,10 UPS and the Union all read paragraph one to 

apply to all talk-to's, regardless of Union knowledge, and so do 

I. The majority states that a broad "interpretation of paragraph 

one of the award is not suggested by the language of the award 

itself." (Maj. Op. at 8). However, paragraph one's clear 

statement that "[talk-to's] may not be admitted over the 

objection of the Union members" supports this interpretation. 

Paragraph one makes no reference to Union knowledge or lack 

thereof; it directs a broad prohibition. 

 The arbitrator's opinion eliminates any doubt that 

paragraph one may be limited to cases of Union ignorance when it 

states: "The Union panel members could in a specific future case 

simply object to the introduction of `talk-to's' as such, without 

regard to the prior processing or handling of such material, and 

. . . this would be sufficient to bar the introduction of such 

material." App. at 61. The majority quotes this language, states 

that it is ambiguous and concludes that "when an award does not 

apparently exceed the scope of the parties' submission, it will 

 

 

10Specifically, the district court characterized paragraph 

one as saying, "that `talk-to's' are never admissible if the 

Union objects."Opn. at 8. 
be affirmed, regardless of inferences that may be drawn from the 

accompanying opinion." Maj. Op. at 8 (citing United Steelworkers 

of Am., 363 U.S. at 598). However, paragraph one, as read by the 

district court, the parties, and me, facially exceeds the scope 

of the parties' submission. Thus, the majority cannot simply 

dismiss the language in the arbitrator's opinion which supports a 

broad reading of paragraph one as being ambiguous. 

 The district court upheld paragraph one, despite 

concluding that paragraph one encompassed all talk-to's, 

regardless of Union knowledge. It concluded that the submission 

was not limited to situations where the Union was ignorant of the 

talk-to's and that therefore, paragraph one did not exceed the 

scope of the submission. The majority turns the district court's 

reasoning on its head. It rejects the district court's broad 

reading of the submission, as I believe it must. However, it 

upholds the award because it baldly assumes that paragraph one 

only applies to situations where the Union is ignorant of talkto's prior to the hearing. 

 The majority supports its holding by assuming that the 

arbitrator's award addresses "only those talk-to's of which the 

Union did not have prior knowledge . . ." because that was the 

only issue submitted for arbitration. Maj. Op. at 8. It seems 

to me that this reasoning is circular. The majority states that 

the award cannot exceed the submission because the submission is 

narrow and therefore that this court must assume that the award 
is narrow. The majority justifies ignoring paragraph one's 

language and the arbitrator's opinion by making an unwarranted 

assumption. The majority offers no authority for assuming that 

paragraph one is narrow, nor does it explain why the district 

court's, the Union's and UPS's broad reading of paragraph one is 

incorrect. The majority concludes that: 

 the arbitrator's award, on its face, does not 

contain any language indicating that it 

extends beyond the scope of the question 

presented. Rather paragraph one is logically 

read as a direct response to the parties' 

submission, pertaining only to talk-to's 

about which the Union had no prior knowledge. 

Maj. Op. at 8-9. 

 But where is the logic? The majority offers no support 

for its "logical" conclusion. To the majority, it is logical 

only because of its unwarranted assumptions. I believe that, 

contrary to the majority's "logical" reading, paragraph one of 

the arbitrator's award broadly rules against the admission of 

talk-to's. It therefore exceeds the scope of the issue submitted 

for arbitration, serves no useful purpose, and is wholly 

unnecessary to the unchallenged disposition of the issue 

submitted for arbitration. 

II. 

 The majority correctly notes that an arbitrator's award 

will be upheld so long as it draws its essence from the 

collective bargaining agreement unless the award is tainted by 

fraud or bias or addresses matters outside the arbitrator's 
authority. The majority concludes that pragraph one of the award 

draws its essence from the parties' collective bargaining 

agreement and therefore, upholds it. I respectfully disagree. 

 The arbitrator does not satisfactorily explain why he 

needed to make paragraph one's broad ruling. The specific limits 

of the submission and the conflict between paragraphs one and two 

of his award belie his claim that it was necessary to resolve 

paragraph one before he could resolve paragraph two. 

 Under paragraph one of the award, a single Union member 

would have the right to bar evidence submitted at a hearing. 

This is contrary to the rules of procedure established under the 

basic collective bargaining agreement between the parties. The 

1990-93 National Master United Parcel Services Agreement and the 

Central Pennsylvania Supplement provides that a hearing panel 

will be composed of four members, two appointed by the Union, and 

two appointed by UPS and that the panel's majority decision will 

bind the parties. The members of this joint Union and company 

panel sit as neutrals and attempt to equitably resolve disputes. 

In creating the panel, the parties struck an even balance of 

power with management and the Union having equal representation. 

Under this system, decisions are made upon majority vote, or if 

deadlocked are sent to an outside arbitrator for resolution. The 

essence of the panel structure under the agreement is that panel 

decisions are by majority vote. 
 Article 48 of the parties' collective bargaining 

agreement specifically prohibits an arbitrator from modifying 

that agreement.11 By allowing a single Union member to bar 

evidence from a proceeding, the arbitrator has overturned the 

majority concept of the panel structure and fundamentally altered 

the parties' agreement. The parties bargained for equal power on 

the panel. Paragraph one of the arbitrator's award shifts the 

balance of power towards the Union and upsets the parties' 

bargained-for equality. In so doing, the arbitrator's decision 

has the potential to undermine the parties' entire grievance and 

arbitration procedure. 

 Paragraph one of the arbitrator's award violates the 

essence of the parties' collective bargaining agreement by 

depriving the parties of their contractual right to have an 

arbitrator resolve deadlocks on evidentiary disputes over the 

admissibility of "talk-to's." Accordingly, this court should 

reverse the district court's decision and remand with directions 

to enter summary judgment on UPS's behalf. 

III. 

 Instead of putting to rest a simple procedural issue, 

the arbitrator has unilaterally raised questions that have the 

potential to generate labor unrest between the parties. 

 

 

11Article 48, § 2 of the basic collective bargaining 

agreement provides in pertinent part that an arbitrator "shall 

not have the authority to amend or modify this Agreement or 

establish new terms . . . under the Agreement." 
Paragraph one of the arbitrator's award exceeds the scope of the 

submission, violates the essences of the parties' collective 

bargaining agreement and should be vacated.12 I therefore 

respectfully dissent. 

 

 

12The appellant on appeal also contends that paragraph one of 

the arbitrator's award should be vacated because it violates "a 

well-defined dominant public policy." I see no need to reach 

that issue and I therefore do not discuss it.