## United States Court of Appeals FOR THE EIGHTH CIRCUIT

___________ No. 98-1354

___________ Bureau of Engraving, Inc., *
* Appellant, *
* Appeal from the United States
v. * District Court for the
* District of Minnesota. Graphic Communications International * Union, Local 1B, * * Appellee. *

___________ Submitted: November 19, 1998 Filed: January 6, 1999

___________ Before BEAM, MAGILL, and MORRIS SHEPPARD ARNOLD, Circuit Judges.

___________ MAGILL, Circuit Judge.

The Bure au of Engraving, Inc. appeals from the district court’s denial of it s motion to vac ate two labor arbitration awards that provided two employees monetary damages for missed overtime opportunities. The Bureau contends that these award s failed to draw th eir essence from the collective bargaining agreement. We agree and, thus, reverse.The current CBA is effective from April 1, 1995 through March 31, 2000. 1
-2- I.

The Bur eau of Engraving, Inc. (Bureau) and the Graphic Communication s Inte rnational Union, Local 1B (Union) have been parties to several collectiv e barg aining agreements that have regulated the distribution of overtime opportunitie s to Bureau employees. Between April 1988 and March 1995, the applicab le agreements mandated that overtime opportunities be allocated under a system of equalization

. Under this system, if the Bureau improperly overlooked an employee for overtime, it would simply offer him or her the next available overtime opportunity--the so calle d “make-up” remedy.

When the parties negotiated their current collective bargaining agreemen t (CBA), they agreed to eliminate the equalization system of overtime distributio n

1 because it caused too many complaints. In its place, the parties agreed to a straigh t rotation system of overtime distribution. Un der this system, the first eligible employee on an overtime lis t receives the next available overtime opportunity. If that employee declines the oppo rtunity or is not available, the Bureau offers the overtime to the next employee on the list.

Alt hough the CBA modifies the method for allocating overtime, it does not set forth any specific remedy for failure to follow that allocation scheme. Whil e negotiating the current CBA, the Union proposed a monetary remedy for breach of the overt ime provisions. The Bureau, however, rejected this remedy. See Plocker Arb

. Award at 3, reprinted in

J.A. at 109. N o other remedy, apparently, was proposed, and the C BA contains no provision governing remedies for breach of the overtim e provisions.
In 1995 and 1996, the Bureau breached the CBA by skipping two employeesIn this appeal, the Bureau does not dispute the finding that it breached the CBA. 2 The arbitration provision of the CBA provides: 3

All disputes and grievances arising over the interpretation of, o r adherence to, the terms and provisions of the Collective Bargainin g Agreeme nt, including any questions of the arbitrability of any dispute or grievance, s hall be subject to resolution by the procedure set forth in the Grievance and Arbitration language of Section 3. Collective Bargaining Agreement § 3(a), at 2, reprinted in J.A. at 12. The arbitrators awarded the grie vants compensation for a total of 12.5 hours of 4 missed overtime at the Sunday double-time rate.
-3- when it was their turn in the overtime rotation. Both employees filed grievance s 2 seeking monetar

y awards for the Bureau’s breaches. The Union sought arbitration of both di sputes before separate arbitrators. In both arbitrations, the Union argued that 3 the arbitrators should impose a monetary re medy for breach of the overtime provisions because the Bureau’s prior practice of offering a make- up opportunity was inconsistent with the new straight rotation system. The Union argued that the make-up remed y might not make the employees whole because the next op portunity might not be for the

same number of

hours or pay, the next opportunity might not arise for a long perio d of time, the employee might be “up” in the rotation when the make-up opportunit y aris es, and the employee might not be able to work during the make-up opportunity

. In contrast, the Bureau argued tha t the CBA did not allow for a monetary remedy and, in any event, that the make-up remedy was consistent with the parties’ past practices and did not disrupt the straight rotation system. Both arbitrators independentl y concluded that a make-up remedy was not appropriate and ordered the Bureau t o remedy its breaches with monetary damages. 4

The Bureau filed a motion to vacate the awar ds in the district court, arguing that they failed to draw their essence from the CBA. The Union filed a cross-motion to-4-

confir m the awards. The district court granted summary judgment to the Union an d entered judgment confirming the awards. The Bureau appeals from this judgment.

II.

The Bureau ar gues that we must reverse the district court’s judgment enforcing the arbitrators’ awards because they failed to draw their essence fro m the parties’ CBA. We agree.

“The district court’s denial of a motion to vacate an arbitration award is no t entitled to any special deference on appeal, and this Court reviews its conclusions of law de novo.” Homestake Mining Co. v. United Steelworkers, Local 7044 , 153 F.3d 678, 680 (8th Cir. 1998). In contrast, our review of an arb itrator’s award is deferential. “As long a s the arbitrator’s award ‘draws its essence from the collective bargainin g agreement ,’ and is not merely ‘his own brand of industrial justice,’ the award i s l e gitimate.” United Paperworkers Int’l Union v. Misco, Inc. , 484 U.S. 29, 36 (1987) (quotin g United Steelworkers v. Enterprise Wheel & Car Corp. , 363 U.S. 593, 59 7 (19 60)). Although we may not vacate an award if the arbitrator was arguabl y construing or applying th e CBA, see Misco , 484 U.S. at 38, we may reverse an award that either fails to draw its essence from the CBA or is contrary to the plain language of the agreem ent. See Keebler Co. v. Milk Drivers & Dairy Employees Union, Local No. 471 , 80 F.3d 284, 287 (8th Cir. 1996) (citing I owa Mold Tooling Co. v. Teamsters Local Union No. 828 , 16 F.3d 311, 312 (8th Cir. 1994)).

We believe that the awards failed to draw their essence from the CBA. Th e
essence of the CBA is derived not only from its express provisions, but also from the industrial common law. See United Steelworkers v. Warrior & Gulf Navigation Co. , 363 U.S . 574, 581-82 (1960). The industrial common law includes the past practices of the industry and the shop, see id. , as well as the parties’ ne gotiating history and other extrinsic evidence of their intent. See International Woodworkers v. Weyerhaeuser-5-

Co. , 7 F.3d 133, 136-37 (8th Cir. 1993); Fairview Southdale Hosp. v. Minnesot a Nurses Ass'n , 943 F.2d 809, 811-12 (8th Cir. 1991).

It is undisputed that the CBA is silent regarding remedies for breach of th e overt ime provisions. If an arbitrator attempts to interpret a written agreement that i s silent or ambig uous without considering the parties’ intent, his award will fail to draw its essence from the CBA. See Weyerhaeuser , 7 F.3d at 136-37; see also CSX Transp., Inc. v. United Transp. Union , 29 F.3d 931, 936 (4th Cir. 1994) (“In construing an y
co ntract, including a collective bargaining agreement, determining the intent of th e parties is t he essential inquiry”; if the written agreement is silent, the arbitrator ma y
co nsider past practices and bargaining history to fill gaps). Accordingly, we mus t “consider whether it is at all plausible to suppose that the remedy [the arbitrators ] devised was within the contemplat ion of the parties and hence implicitly authorized by th e agreement.” Independent Employees’ Union of Hillshire Farm Co. v. Hillshir e Farm Co. , 826 F.2d 530, 533 (7th Cir. 1987) (quotations omitted).

Here, the industrial common law and eviden ce of the parties’ intent militates our conclusion that the awards failed to draw their essence from the CBA. Prior to April 1, 1995, the Bureau offered a make-up remedy when it breached the overtim e provisions. Thus, a

monetary award cannot find support in the parties’ past practices. More importantly, the parties’ collective bargaining history clearly shows that a monetar y remedy was contemplated and excluded from the CBA. The Burea u prese nted uncontroverted evidence that the Union proposed a monetary remedy fo r breach of the overtime provisions and that the Bureau explicitly rejected that proposal. Because this evidence shows that the Bureau did not anticipate a monetary award for breach of the overtime provisions, we conclude that the awards were not within th e contemplation of the parties a nd, therefore, not implicitly authorized by the CBA. See Phoenix Newsp apers, Inc. v. Phoenix Mailers Union Local 752 , 989 F.2d 1077, 1082 (9th Cir. 1993) (vacating arbitrator’s award when employer rejected same remedy i n prior collective bargaining agreement negotiations). In sum, the arbitrators’ awards-6-

failed to draw their essence from the CBA because (1) the CBA was silent regarding remedies, (2) the awards we re inconsistent with the parties’ past practices, and (3) the awards direc tly contravene the Bureau’s clear intent not to be bound by a monetar y remed y during CBA negotiations. The awards here were not derived from a n interpret ation of the CBA. Rather, the arbitrators were dispensing their own brand of industrial justice. S ee Enterprise Wheel , 363 U.S. at 597 (“The draftsmen may never hav e thought of what specific remedy should be awarded to meet a particula r contingency. Nevertheless, an arbitrator is confined to interpretation and application of the co llective bargaining agreement; he does not sit to dispense his own brand o f industrial justice.”).

The Union cites Daniel Constr. Co. v. International Union of Operatin g Engineers, Local 513 , 738 F.2d 296, 300 (8th Cir. 1984), for the proposition that a n arb itrator may craft an award not specifically provided for in a collective bargainin g agree ment. While this may be true, the arbitrators here have crafted a remed y specifically excluded from the CBA and in direct contravention with the parties’ past practices and intent. We, therefore, conclude that Daniel does not require a different result in this case.

III.

We conclude that the arbitrators’ awards failed to draw their essence from the CBA. The CBA was silent regarding the appropriate remedy for breach of th e overtime provisions, but the arbitrators’ imposed awards that were inconsistent wit h th e parties’ past practices and their intent as evidenced by their CBA negotiations

. Acc ordingly, we reverse the district court’s order and remand with instructions t o vacate the awards.-7-

A true copy.

Attest:

CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.