United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

No. 98-1354

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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. *

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Submitted: November 19, 1998

 Filed: January 6, 1999

___________

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

___________

MAGILL, Circuit Judge.

The Bureau of Engraving, Inc. appeals from the district court’s denial of its

motion to vacate two labor arbitration awards that provided two employees monetary

damages for missed overtime opportunities. The Bureau contends that these awards

failed to draw their 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

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I.

The Bureau of Engraving, Inc. (Bureau) and the Graphic Communications

International Union, Local 1B (Union) have been parties to several collective

bargaining agreements that have regulated the distribution of overtime opportunities

to Bureau employees. Between April 1988 and March 1995, the applicable 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 called

“make-up” remedy.

When the parties negotiated their current collective bargaining agreement

(CBA), they agreed to eliminate the equalization system of overtime distribution

1

because it caused too many complaints. In its place, the parties agreed to a straight

rotation system of overtime distribution. Under this system, the first eligible employee

on an overtime list receives the next available overtime opportunity. If that employee

declines the opportunity or is not available, the Bureau offers the overtime to the next

employee on the list.

Although the CBA modifies the method for allocating overtime, it does not set

forth any specific remedy for failure to follow that allocation scheme. While

negotiating the current CBA, the Union proposed a monetary remedy for breach of the

overtime provisions. The Bureau, however, rejected this remedy. See Plocker Arb.

Award at 3, reprinted in J.A. at 109. No other remedy, apparently, was proposed, and

the CBA contains no provision governing remedies for breach of the overtime

provisions. 

In 1995 and 1996, the Bureau breached the CBA by skipping two employees
In 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, or

adherence to, the terms and provisions of the Collective Bargaining

Agreement, including any questions of the arbitrability of any dispute or

grievance, shall 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 grievants compensation for a total of 12.5 hours of 4

missed overtime at the Sunday double-time rate.

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when it was their turn in the overtime rotation. Both employees filed grievances

2

seeking monetary awards for the Bureau’s breaches. The Union sought arbitration of

both disputes before separate arbitrators. In both arbitrations, the Union argued that 3

the arbitrators should impose a monetary remedy 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 remedy

might not make the employees whole because the next opportunity might not be for the

same number of hours or pay, the next opportunity might not arise for a long period

of time, the employee might be “up” in the rotation when the make-up opportunity

arises, and the employee might not be able to work during the make-up opportunity.

In contrast, the Bureau argued that 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 independently

concluded that a make-up remedy was not appropriate and ordered the Bureau to

remedy its breaches with monetary damages.4

The Bureau filed a motion to vacate the awards in the district court, arguing that

they failed to draw their essence from the CBA. The Union filed a cross-motion to
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confirm the awards. The district court granted summary judgment to the Union and

entered judgment confirming the awards. The Bureau appeals from this judgment.

II.

The Bureau argues that we must reverse the district court’s judgment enforcing

the arbitrators’ awards because they failed to draw their essence from the parties’ CBA.

We agree.

“The district court’s denial of a motion to vacate an arbitration award is not

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 arbitrator’s award is deferential.

“As long as the arbitrator’s award ‘draws its essence from the collective bargaining

agreement,’ and is not merely ‘his own brand of industrial justice,’ the award is

legitimate.” United Paperworkers Int’l Union v. Misco, Inc., 484 U.S. 29, 36 (1987)

(quoting United Steelworkers v. Enterprise Wheel & Car Corp., 363 U.S. 593, 597

(1960)). Although we may not vacate an award if the arbitrator was arguably

construing or applying the 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 agreement. See Keebler Co. v. Milk Drivers & Dairy Employees Union, Local

No. 471, 80 F.3d 284, 287 (8th Cir. 1996) (citing Iowa 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. The

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’ negotiating history and other

extrinsic evidence of their intent. See International Woodworkers v. Weyerhaeuser
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Co., 7 F.3d 133, 136-37 (8th Cir. 1993); Fairview Southdale Hosp. v. Minnesota

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 the

overtime provisions. If an arbitrator attempts to interpret a written agreement that is

silent or ambiguous 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 any

contract, including a collective bargaining agreement, determining the intent of the

parties is the essential inquiry”; if the written agreement is silent, the arbitrator may

consider past practices and bargaining history to fill gaps). Accordingly, we must

“consider whether it is at all plausible to suppose that the remedy [the arbitrators]

devised was within the contemplation of the parties and hence implicitly authorized by

the agreement.” Independent Employees’ Union of Hillshire Farm Co. v. Hillshire

Farm Co., 826 F.2d 530, 533 (7th Cir. 1987) (quotations omitted).

Here, the industrial common law and evidence 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 overtime

provisions. Thus, a monetary award cannot find support in the parties’ past practices.

More importantly, the parties’ collective bargaining history clearly shows that a

monetary remedy was contemplated and excluded from the CBA. The Bureau

presented uncontroverted evidence that the Union proposed a monetary remedy for

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 the

contemplation of the parties and, therefore, not implicitly authorized by the CBA. See

Phoenix Newspapers, Inc. v. Phoenix Mailers Union Local 752, 989 F.2d 1077, 1082

(9th Cir. 1993) (vacating arbitrator’s award when employer rejected same remedy in

prior collective bargaining agreement negotiations). In sum, the arbitrators’ awards
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failed to draw their essence from the CBA because (1) the CBA was silent regarding

remedies, (2) the awards were inconsistent with the parties’ past practices, and (3) the

awards directly contravene the Bureau’s clear intent not to be bound by a monetary

remedy during CBA negotiations. The awards here were not derived from an

interpretation of the CBA. Rather, the arbitrators were dispensing their own brand of

industrial justice. See Enterprise Wheel, 363 U.S. at 597 (“The draftsmen may never

have thought of what specific remedy should be awarded to meet a particular

contingency. Nevertheless, an arbitrator is confined to interpretation and application

of the collective bargaining agreement; he does not sit to dispense his own brand of

industrial justice.”).

The Union cites Daniel Constr. Co. v. International Union of Operating

Engineers, Local 513, 738 F.2d 296, 300 (8th Cir. 1984), for the proposition that an

arbitrator may craft an award not specifically provided for in a collective bargaining

agreement. While this may be true, the arbitrators here have crafted a remedy

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 the

overtime provisions, but the arbitrators’ imposed awards that were inconsistent with

the parties’ past practices and their intent as evidenced by their CBA negotiations.

Accordingly, we reverse the district court’s order and remand with instructions to

vacate the awards.
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A true copy.

Attest:

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