Source: http://il.findacase.com/research/wfrmDocViewer.aspx/xq/fac.19911203_0000467.NIL.htm/qx
Timestamp: 2017-01-20 06:02:50
Document Index: 441474066

Matched Legal Cases: ['§ 502', '§ 502', '§ 5154', '§ 515', '§ 515', '§ 1', '§ 1']

| CENTRAL STATES v. TANK TRANSP.
CENTRAL STATES v. TANK TRANSP.
TANK TRANSPORT, INC., a Wisconsin corporation, Defendant.
MEMORANDUM OPINION AND ORDER Plaintiff, Central States, Southeast and Southwest Areas Pension Fund (Central States), brought an action under § 502(e)(1) of ERISA to collect contributions allegedly owed to it be the defendant, Tank Transport, Inc. ("Tank"). Defendant brought a motion to dismiss this action, and the court entered an order dismissing plaintiffs' claim, and compelling arbitration of this matter. Central States filed a timely motion for reconsideration. For the reasons explained below, plaintiffs' motion to reconsider is granted, and defendant's motion to dismiss is denied. Background Central States is a multi-employer pension fund that receives contributions from more than 6000 different employers. Generally, employees negotiate collective bargaining agreements with local unions and as part of these agreements create pension fund contribution requirements for the employers. Tank entered into collective bargaining agreements with the International Brotherhood of Teamsters Local Union 200, which required them to participate in the Central States Multi-employer Trust Fund. While Tank has paid contributions to Central States since 1971, the most recent agreement between Tank and Local 200 covered the periods of November 15, 1985, through May 14, 1989, and May 15, 1989, through May 14, 1992. Under the terms of this agreement, Tank contributes thirteen dollars per day for each "regular employee" covered by this agreement to the Central States pension fund, who is on the payroll thirty days or more. (See Article 30 of the Collective Bargaining Agreement). During a 1990 audit of Tank's records, Central States determined that Tank owed certain sums as contributions on behalf of a certain group of employees covered under the collateral agreements to the collective bargaining agreements. These collateral agreements established a separate division of employees known as the Special Services Division ("SSD"), on whose behalf pension contributions were made to a Section 401(k) plan, rather than to Central States Pension Fund. The SSD division was established by Tank to make it more competitive with new non-union competition which now controls the marketplace. The wage packages of the "regular division" (those employees covered under the Central States Pension Fund) agreement and the SSD division agreement were similar. However, the SSD division agreement was less costly in terms of vacations, holidays, sick leave, health and welfare and pension. Central States argues that it never approved of, nor was even informed of the existence of the SSD agreements until the audit was conducted. Tank has paid all contributions that it owed to Central States of behalf of the "regular division" employees as required by Article 30 in the collective bargaining agreements, but disputes its obligations to contribute to the fund on behalf of the SSD employees. After the Audit, Central States brought an action under § 502(e)(1) of ERISA
to enforce the collective bargaining agreements requiring contributions to Central States on behalf of all regular employees. Tank then moved to dismiss the action based on Article 30 of the collective bargaining agreements, which provides that "disputes or questions of interpretation concerning the requirement to make contributions on behalf of particular covered employees shall be submitted directly to the grievance procedure, beginning with Step 4." Article 8, Step 4, of the Collective Bargaining Agreement provides for a decision on the dispute to be made by the Wisconsin Joint Petroleum and Cement Grievance Committee.
If the grievance committee "deadlocks" either party may request that the grievance be referred to binding arbitration. In the previous decision, the court granted Tank's motion to dismiss and compel arbitration Shortly thereafter, the Wisconsin Joint Petroleum and Cement Grievance Committee met, and held that Tank's failure to pay contributions to Central States on behalf of the SSD employees did not violate the collective bargaining agreement or collateral agreement. The Committee having ruled, this dispute is again before the court on a motion for reconsideration. Discussion Central States presents several arguments to support the motion for reconsideration, many of which will not be discussed here. The primary issue in this motion is whether a statutory claim created under § 5154 of ERISA may be resolved through an agreement in a collective bargaining agreement to settle contribution disputes through grievance committee decisions, and/or arbitration, or whether statutory claims brought under § 515 of ERISA must proceed directly to a federal district court. If such collective bargaining agreements are allowable, the secondary issue in this case is whether the instruments in the instant case (the trust agreement, the collective bargaining agreement, and the collateral agreement) require Central States to submit their contribution dispute to this procedure. Since the court finds that submission of a § 515 ERISA statutory right to a grievance committee and/or subsequent arbitration is inappropriate in the instant case, the second issue need not be discussed. Discussion Central states first argues that the court incorrectly determined that there is a presumption in favor of arbitration in this case. Plaintiff contends that the court's reliance on the Federal Arbitration Act, 9 U.S.C. § 1 et seq. ("FAA"), is inappropriate because the type of dispute involved in the instant case concerns "employment contracts" of "workers engaged in foreign or interstate commerce", which are specifically excluded from the FAA. 9 U.S.C. § 1. The court agrees with the plaintiffs' argument. This case involves collective bargaining disputes between a union and an employer. Collective bargaining agreements are contracts of employment within the meaning of the FAA's exclusions. American Postal Workers Union v. U.S. Postal Service, 823 F.2d 466 (11th Cir. 1987). Most courts have limited the exclusion to "workers actually engaged in interstate commerce," See Pietro Scalzitti Construction Co. v. Int'l Union of Operating Engineers, 351 F.2d 576 (7th Cir. 1985), such as bus drivers and truck drivers. Tank Transport is a motor carrier corporation that transports commodities in interstate commerce. Its employees (truck drivers) are members of the International Brotherhood of Teamsters ("IBT"). The court finds that employment contracts involving these types of employees are the types of agreements excluded from the Federal Arbitration Act. &nbsp;However, this determination alone would not alter the court's previous decision.
Central States also argues that there is a presumption against arbitration of ERISA fringe benefit contribution disputes. In making this argument, the plaintiff heavily relies on the Supreme Court's decision in Schneider Moving Co. v. Robbins,, 466 U.S. 364, 104 S. Ct. 1844, 80 L. Ed. 2d 366 (1984), ...