Opinion ID: 524069
Heading Depth: 2
Heading Rank: 4

Heading: Waiver and the Proper Decisionmaking Forum.

Text: 78 The majority holds that Southwest has a duty to bargain because implementation of the program would effect[ ] a change in rules and working conditions. Because this dispute is major by definition, the majority's ratio decidendi is that (1) the Union has arguably made a clear and unmistakable waiver of its right to bargain over changes in contractual terms where the contract is materially silent; (2) the contract is materially silent; and (3) the board of adjustment should decide whether the Union has arguably waived its bargaining rights. Thus raising the term arguable to talismanic status, the majority relentlessly Hubbardizes a clause that on its face allows mere interstitial rulemaking into an arguable zipper clause of global scope that cuts only in favor of Southwest. We may have to look at waiver through permanently scratched lenses after today. 22 79 No ambiguity suggests arguable waiver in this case. The panel was correct in determining the waiver issue as a question of law. In any event, the determination is reserved for a federal court, not an adjustment board. In this major dispute, the majority's holding concerning waiver is inconsistent with both the statutory scheme and controlling case authority. 80 The majority also states, amidst a cloud of dicta, that we need not decide whether waiver analysis applies to RLA cases. As I shall discuss below, waiver analysis is a generic rule of construction that certainly applies in RLA cases because there is no alternative except fiat. 81 We face one controlling question today: whether a federal court or a board of adjustment in these circumstances should decide if the Union has clearly and unmistakably waived its right to bargain. But an answer to the question requires a thorough understanding of the role of waiver in labor contracts because management rights clauses appear in almost every labor contract subject to both the RLA and the NLRA. 82 A. What is a Zipper Clause? Although the majority uses different phraseology, the majority holds that the Union has arguably bargained away a zipper clause to Southwest. The management rights clause in this case provides that 83 Employees covered by this Agreement shall be governed by all Company rules, regulations and orders previously or hereafter issued by proper authorities of the Company which are not in conflict with the terms and conditions of this Agreement.... 84 Management rights clauses are ubiquitous in labor contracts. A Bureau of National Affairs survey indicates that approximately 99% of all labor contracts contain management rights clauses. 23 85 In this case, the majority holds that the Union has arguably waived its right to bargain although nothing in the parties' bargaining history suggests that the Union has waived its rights, and the language of the agreement states nothing specific concerning a waiver of the right to bargain. Absolutely nothing in the record below, apart from the language of the management rights clause itself, suggests waiver. The majority thus holds that unions subject to the RLA have arguably waived their statutory right to bargain in every dispute under the RLA involving a boilerplate management rights clause like this one when the contract is arguably silent in material respects. The majority's holding will sweep widely. 24 86 Management rights clauses most commonly allow interstitial rulemaking. Unions are not interested in bargaining over day-to-day management decisions that do not change the conditions of employment in the bargaining unit. But in some cases, management rights clauses may also allow unilateral changes in working conditions by management during the life of the contract when the language of the clause or the parties' bargaining history demonstrates that the union has ceded the right to the employer. In the labor arena, these clauses are often termed zipper clauses. 87 A zipper clause receives its name from the image of the self-contained bargain, where the contract contains everything the parties could possibly bargain over in the world, where nothing lies outside the scope of the contract, where neither contractual vacuum nor silence exists. The zipper clause contains all of the content of the parties' bargain that is not otherwise expressed or implied by past practice. 88 One may interpret a zipper clause in two ways. First, and most logically, a zipper clause may mean that neither party to the agreement may change rates of pay, rules or working conditions during the life of the agreement, unless the contract contains a specific reopener clause or reopener clauses, because express and implied terms solely guide the parties' conduct. See United Automobile Workers v. NLRB, 765 F.2d 175, 180 (D.C.Cir.1985) (Edwards, J.). More commonly, zipper clauses are interpreted to allow management to act unilaterally to change the conditions of employment. If the management rights clause in this case is a zipper clause, it would carry the latter meaning because it speaks in terms of discretionary management rulemaking. 89 B. The Rule of Construction. Deciding whether a Union has clearly and unmistakably waived its statutory bargaining rights in the form of a zipper clause involves the application of a straightforward rule of construction in contract analysis. The majority, for no substantive reason, decides that the rule of construction may not apply under the RLA: the difference between the [NLRA and RLA] creates a debatable matter of law concerning whether waiver analysis even applies in a case arising under the RLA. 90 The majority does not and could not reject waiver analysis as a rule of construction under the RLA. Waiver is a generic concept, and its evidentiary predicates have deep roots in the law. A waiver is a voluntary and intentional relinquishment of a known right or conduct that warrants an inference of such a relinquishment. FDIC v. Condit, 861 F.2d 853, 857 (5th Cir.1988) (citations omitted); see, e.g., St. Louis Electric Light & Power Co. v. Edison General Electric, 64 F. 997, 1001 (Circuit Court, E.D.Mo.1894) (It is elementary law that, to constitute a waiver, the party upon whom it operates must have full knowledge of all the essential or material facts ... and the party relying upon such waiver assumes the burden of proof as to the knowledge of the party making the waiver); see also, e.g., Cordova v. Hood, 84 U.S. (17 Wall.) 1, 21 L.Ed. 587, 589 (1873) (Waiver is a thing of intention as well as of action). 91 In the labor context, voluntary relinquishment of the statutory right to bargain exists either in a contract's specific language or where the parties' bargaining history suggests that the parties discussed the subject and the Union consciously yielded its right to bargain over a proposed change in working conditions. NL Industries, Inc., 220 N.L.R.B. 41, 43-44 (1975), enforced, 536 F.2d 786 (8th Cir.1976). A union's waiver must be clear and unmistakable. Metropolitan Edison Co. v. NLRB, 460 U.S. 693, 708, 103 S.Ct. 1467, 1477, 75 L.Ed.2d 387 (1983); see also Lingle v. Norge Division of Magic Chef, --- U.S. ----, 108 S.Ct. 1877, 1883 n. 9, 100 L.Ed.2d 410 (1988). In a sense, the phrase clear and unmistakable is superfluous because a waiver in any context must be unambiguously evidenced. The terms clear and unmistakable merely make emphatic the inherently strict requirements predicating any conclusion that a party has waived its rights. 92 Whether the decisionmaker is a federal court or an arbitral forum, someone has to decide if a union has bargained away, in the form of a zipper clause, its statutory right to bargain over proposed changes in working conditions where the contract is materially silent. Implicitly recognizing this in its holding, the majority does not offer an alternative to waiver analysis because no alternative exists. Major disputes arise from unilaterally attempted or proposed changes in working conditions. If a union has bargained away its statutory right to bargain over changes in working conditions, no major disputes may arise during the life of the contract concerning an employer's unilateral changes in working conditions when the contract is materially silent. Without waiver analysis as a rule of construction, one is left with fiat. 93 Even if it were possible that a coherent alternative to waiver analysis existed, there would be no reason to treat the RLA and NLRA differently in deciding whether the Union has bargained away a zipper clause. It is true that NLRA principles do not apply uniformly to RLA disputes because the statutory schemes are different. First National Maintenance, 101 S.Ct. at 2585 n. 23. But the majority's flow of words points to no material distinction between the Acts that suggests the statutory right to bargain under the RLA is any more subject to waiver than the right to bargain under the NLRA. 94 The majority notes only general distinctions in the Acts that make no difference in this context. In fact, at least three RLA policies mandate the use of waiver analysis. First, both the content of and the animating spirits behind the two magna cartas of federal labor policy insure the right to bargain. 45 U.S.C. Sec. 152, First; 28 U.S.C. Sec. 158. Second, the statutory duty to bargain is at least as broad under the RLA as it is under the NLRA. See, e.g., First National Maintenance, 101 S.Ct. at 2585, n. 23; see Rockwood & Co., 285 N.L.R.B. No. 138 (1987) (National Labor Relations Board held a drug and alcohol testing program a mandatory subject of bargaining under NLRA; opinion of Administrative Law Judge, adopted by Board, rejected employer's argument that Union had waived its right to bargain). And finally, although both statutes were passed to insure industrial peace, only the RLA, not the NLRA, contains a statutory no-strike policy. Texas & N.O. R. Co. v. Brotherhood of Ry. & S.S. Clerks, 281 U.S. 548, 50 S.Ct. 427, 432, 74 L.Ed. 1034 (1930) (the major purpose of Congress in passing the Railway Labor Act was 'to provide a machinery to prevent strikes' ); Buffalo Forge v. Steelworkers, 428 U.S. 397, 96 S.Ct. 3141, 3148, 49 L.Ed.2d 1022 (1976) ( '[T]here is no general federal anti-strike policy [under the NLRA]'  (quoting Sinclair Refining Co. v. Atkinson, 370 U.S. 195, 225, 82 S.Ct. 1328, 1344, 8 L.Ed.2d 440 (Brennan, J., dissenting))). Yet the RLA carefully preserves a party's ultimate access to its strike rights in major disputes. 45 U.S.C. Secs. 155, 156, 160; Elgin, 325 U.S. at 723-24, 65 S.Ct. at 1289-90. Thus, we should be particularly wary in RLA cases of claims that a union has waived its already limited access to economic weapons. 95 C. The Panel Properly Decided the Waiver Issue. Waiver analysis must apply to RLA disputes. The majority's ratio decidendi appears in its holding that we are not squarely presented at this time with the question of how the 'clear and unmistakable' rule applies to RLA cases [because even assuming it does] ... the construction [of the management rights clause] proposed by Southwest satisfies the minimal burden of arguably being a clear and unmistakable waiver of the Union's right to bargain. 25 According to the majority's reasoning, the Union's arguable waiver transforms a dispute that is by definition major into a so-called minor dispute appropriate for the arbitral forum. 96 The majority's holding is disturbing because it treats only casually the uncertain privacy rights of employees in an area of law riddled with waiver and preemption difficulties. 26 Moreover, the majority's holding fails to make explicit the severe consequences of sending this otherwise major dispute to the arbitral forum. The majority leaves it to the adjustment board to decide the fate of employee strike rights in an otherwise major dispute, thus at best temporarily denying and perhaps erasing the Union's access to economic weapons. 97 The majority's opinion contains three fatal analytical errors. It ignores the unambiguous facts of this case; it is inconsistent with the statutory scheme; and it is inconsistent with RLA case authority. The panel concluded correctly that the union has not waived anything, arguably or otherwise, and that this controversy should be routed to the major dispute process. 98 1. Question of Law. The arguably justified standard concerns the relationship between the content of contractual terms and a party's disputed act. The standard should not apply to questions of law that are brought to bear on the terms of the contract in an otherwise major dispute. A federal court should determine in the first instance whether a party has waived its statutory bargaining rights under the RLA. 99 The majority's holding conflicts with the statutory scheme. As I have discussed, the RLA provides for two types of dispute resolution. Disputes over proposed changes in working conditions are major disputes--the types of disputes from which strikes ordinarily result. Major disputes are subject to a complex mediation process, at the end of which the parties may resort to their economic weapons. Minor disputes are often grievances, and concern the proper application or interpretation of agreements. Boards of adjustment decide minor disputes. Parties may not resort to the use of economic weapons in minor disputes. 100 When a party contests which type of dispute the employer and union confront, the party may sue for an injunction in federal court, invoking the federal question jurisdiction of 28 U.S.C. Sec. 1331, to preserve the status quo if the court determines that the dispute is major. 27 After analyzing the parties' contentions, the federal court routes the dispute to one of the two channels of dispute resolution. 101 The majority improperly places in an adjustment board the power to determine whether a union has waived its right to bargain (and ultimately its access to economic weapons) over an issue that is by definition a major dispute. The majority's holding gives one channel of the dispute resolution process (the adjustment board) the power to decide whether the alternative channel (the Mediation Board process that may ultimately lead to use of economic weapons) is the appropriate forum for dispute resolution. But federal courts, not adjustment boards, are at the apex of the triangle in contested forum cases because unlike adjustment boards, federal courts are relative strangers to the actual dispute resolution process. 102 The federal interest in ensuring the proper relationship between courts and arbitrators further demonstrates the majority's error. A court sends a signal concerning the merits of an already determined major dispute when it routes the dispute to an adjustment board, which decides minor disputes, to determine whether a union has waived its right to bargain. As the Supreme Court has noted in an analogous context, [I]t is difficult to believe that the arbitrator would not be heavily influenced or wholly preempted by judicial views.... Buffalo Forge, 96 S.Ct. at 3150. 103 The judicial influence argument may appear to prove too much. It does not. Although courts send disputes to adjustment boards as minor, which may imply judicial views on the merits, the difference between such common cases and this case is that minor disputes belong before an adjustment board. The adjustment board may correct judicial error in characterizing a dispute as minor by nevertheless concluding that a duty to bargain exists because the proposed issue or contested unilateral act constitutes a change in rates of pay, rules or working conditions. In contrast, the majority in this case has already concluded as a matter of law that the dispute is major absent waiver of the right to bargain. The most that the adjustment board may do is ratify the majority's legal conclusion. 104 2. No Ambiguity. Even assuming the majority is correct in applying the arguably justified standard to waiver analysis, its application is incoherent in this case because no material evidence supports a finding of waiver, arguable or otherwise. Southwest's waiver argument, which depends solely on the language of the management rights clause, is not even colorable, much less arguable. Absolutely nothing in the record, apart from the language of the management rights clause itself, supports a determination that the Union has even arguably waived its right to bargain. See St. Louis, S.F. & T. Railway, 328 F.2d at 753 (arguable means more than merely fictitious or even colorable) (Tuttle, J.). 105 Ambiguity, not clarity or unmistakability, gives rise to arguability. Even assuming that a party may arguably waive a known right where the factual context offers conflicting or uncertain evidence, this case, as I have probably stated emphatically enough, involves nothing more than the language of a common management rights clause. Because we have been presented with the material information necessary to decide the question of law, we confront no potential ambiguity resulting from any evidence or contract language, and neither would an arbitrator. In this context, a board of adjustment would have no discretion to decide the issue differently from this court because both decisionmakers would be presented with identical, unambiguous information. Mother Hubbard cannot be arguably pregnant after application of an ultrasound test. 106 It is instructive to compare the language of the management rights clause in this case with the management rights clause rejected by the court in a controlling case in this circuit, United Industrial Workers v. Board of Trustees, 351 F.2d 183, 187 n. 18 (5th Cir.1965), and with the management rights clause rejected by the court in Transport Workers Union v. SEPTA, 863 F.2d 1110, 1124 (3d Cir.1988). I discuss both of these cases immediately below. 28 107 3. Case Authority. The majority's cavalier approach to waiver not only conflicts with the statutory scheme, the facts of this case, and reasoned analysis, it is inconsistent with RLA authority both in this circuit and in the Third Circuit. The law of this circuit supports the Union's position, although the majority would have one believe that management prerogative is enshrined in our precedent. Failing to cite a controlling case, United Industrial Workers, 351 F.2d 183 (5th Cir.1965), the majority misplaces its reliance on Railway Express Agency v. BRAC, 437 F.2d 388 (5th Cir.1971), cert. denied, 403 U.S. 919, 91 S.Ct. 2230, 29 L.Ed.2d 696 (1972). The court in United Industrial Workers completely rejected a management rights argument in a case involving a management rights clause with language explicitly favoring employer discretion in the area at issue. Railway Express Agency v. BRAC is distinguishable because past practices, not the management rights clause, determined the result. In Railway Express, unlike in this case, the employer's unilateral act was arguably justified by prior union acquiescence. 108 In United Industrial Workers, 351 F.2d 183 (5th Cir.1965), a union served notice on a dock owner and operator that it wished to open an existing contract for negotiation concerning a grain elevator facility that employed the union's members. On the same day, the employer advised the union that it would not negotiate, presumably because it had leased the elevator facility to a third party, and posted a notice that all employees would be permanently laid off. 351 F.2d at 185. The court, in an opinion by Judge Brown, held that the dispute was major and that the employer had to bargain before it could put the lease into effect. 109 The court rejected all of the employer's arguments that the contract's terms made the dispute a minor one. In particular, the court rejected the employer's management rights argument. 351 F.2d at 189. The contract's broad management rights clause provided that The management of the [grain] elevator and the direction of the working force, including, but not limited to the right to ... increase and decrease the working force ... are vested exclusively in the carrier. 351 F.2d at 187 n. 18. 110 The court in United Industrial Workers did not infer waiver, arguable or otherwise, even when the language of the management rights clause might appear to have given rise to an arguable issue. The United Industrial Workers court rejected a clause that on its face gave management the right to decrease the workforce in a case that concerned layoffs. The clause in this case is quite less specific than the unspecific management rights clause in United Industrial Workers. In addition, the United Industrial Workers court emphasized that an employer's duty to bargain is extremely broad in the RLA context, relying on Order of Railroad Telegraphers, 362 U.S. 330, 80 S.Ct. 761. 351 F.2d at 191. 111 On a second appeal in the same case, another panel of this circuit emphatically noted the import of the panel's holding on the first appeal: [T]he [carrier's] assignment of error in its cross appeal ... bearing on the construction to be given the 'management rights clause' of the bargaining agreement, is without merit. The district court correctly rejected this as irrelevant in view of this Court's prior opinion. United Industrial Workers, 368 F.2d 412, 414 (5th Cir.1966). 112 The majority's reliance on Railway Express Agency v. BRAC, 437 F.2d 388 (5th Cir.1971), is misplaced because the decision was controlled by prior union acquiescence in unilateral employer work transfers. In Railway Express, the employer unilaterally contracted out to an airline a portion of the employer's air express transfer work that the employees had previously handled at an airport. 437 F.2d at 390. The local union challenged the act, contending that it violated the parties' collective bargaining agreement. The court held that the dispute was minor and routed the dispute to the arbitral forum. 113 As the majority correctly states, Judge Bell's opinion for the panel cites the management rights clause in the collective bargaining agreement. The clause reserved the right of management to determine methods of operation and the utilization of the working forces.... 437 F.2d at 392. But the decision did not result from a holding that the clause constituted an arguable waiver of the right to bargain. 114 The result in Railway Express was controlled by a state of facts, not by the agreement's management rights clause. Id. In Railway Express, there [was] an undisputed work history of such unilateral transfers of work with no apparent objection from the union. Id. In other words, the past practices of the parties controlled the result. The Union had acquiesced in the types of work transfers giving rise to the dispute. Furthermore, the certified bargaining agent was BRAC (the International), which agreed that the dispute was minor and wired the local that the strikers should return to work immediately. Id. at 393. 115 In this case, the Union has not acquiesced in the intrusive and unprecedented enforcement methodology constituted by the drug testing program. Unlike in Railway Express, no state of facts in this case suggests that unilateral implementation of the testing program gives rise to a minor dispute, arguably justified by past practice or any other term of the contract. 116 The majority states that the Railway Express court relied heavily on the Second Circuit's decision in Rutland Railway Corp. v. Brotherhood of Locomotive Engineers, 307 F.2d 21 (2d Cir.1962), and the majority quotes the Rutland decision at length. Rutland is inapposite for two reasons. As I have demonstrated, a state of facts controlled the court's decision in Railway Express. 437 F.2d at 392. Even if Rutland supported the type of Mother Hubbard argument that the majority makes in this case, it would not be persuasive in this circuit because Railway Express was controlled by prior union acquiescence, and United Industrial Workers, 351 F.2d 183, 368 F.2d 412, is the controlling law in this circuit. 117 Rutland does not support the majority's argument in any event. Rutland includes broad language concerning management prerogative, but does not engage in Hubbardizing. Rutland involved an employer's unilateral attempt to make changes on train runs. The court held that the dispute was minor because several specific provisions concerning train runs, 307 F.2d at 35-36, and the prior conduct of the parties, id. at 36, arguably justified the employer's unilateral act. Unlike in this case, the contract in Rutland required arbitral interpretation. 118 The majority's decision also clashes with the law of the Third Circuit, which explicitly has rejected a Mother Hubbard argument in a drug testing case, the material portion of which is similar to the case the majority decides today. Transport Workers Union v. SEPTA, 863 F.2d 1110, 1122-24 (3d Cir.1988). In Transport Workers, the employer relied on the language of a management rights clause in an attempt to justify its unilateral implementation of a drug testing program. The clause provided that the employer retained  'all management functions and responsibilities which SEPTA has not expressly modified or restricted by a specific provision of this Agreement.'  Id. at 1124. The court rejected the employer's argument that it reserved its right to modify its drug testing policies through [the] 'management functions' clause, holding that such broad management rights clauses cannot serve to exempt management from the RLA prohibition against unilateral institution of changes in rules and working conditions. Id. Unlike the majority, the Third Circuit does not believe that unspecific language in a management rights clause supports even a colorable contention that a union arguably has made a clear and unmistakable waiver of its right to bargain. 29 119 D. Summary. Implementation of the testing program, as the majority holds, would effect[ ] a change in rules and working conditions. This is therefore a major dispute. The panel correctly determined that the Union did not waive its statutory right to bargain, and correctly held that this contest should be routed to the major dispute process. 120 Waiver analysis must apply in RLA disputes. Whether a Union has waived its statutory right to bargain is a question of law for a federal court, not a board of adjustment. Even if the arguably justified standard applies to waiver issues, there is no waiver in this case, arguable or otherwise, as a matter of law, because absolutely nothing in the record below suggests waiver. Not least important, the majority's opinion both ignores controlling law of this circuit and is inconsistent with the law of the Third Circuit. 121 Because the Union has not even arguably waived its statutory right to bargain over the program, this contest should be subject to the procedures mandated by 45 U.S.C. Secs. 155, 156, 160. In the major dispute process, a union has a right to bargain in the context of a judicially-enforced status quo. If the parties reach impasse and the President does not intervene, 45 U.S.C. Sec. 160, they may resort to their economic weapons without fear of a federal court injunction. Burlington Northern, 481 U.S. at 445-53, 107 S.Ct. at 1851-55, 95 L.Ed.2d at 398-403. 122