Opinion ID: 482037
Heading Depth: 1
Heading Rank: 4

Heading: The limitations period applicable to the Union's section

Text: 301 action to compel arbitration 25 There remains the question of the limitations period to be applied to the UAW's cross-claim against Bendix to compel arbitration. This is a question of first impression in this Circuit, though other circuits have dealt with the issue recently. Bendix argues, and we agree, that in light of the holding in DelCostello and pursuant to the stated purposes of federal labor policy, the six-month period found in section 10(b) of the National Labor Relations Act is the most appropriate statute of limitations to be applied in a union suit against a company to compel arbitration under section 301. 26 A union's cause of action to compel arbitration arises when the employer takes an unequivocal position that it will not arbitrate. Westinghouse, 736 F.2d at 902. Because here the Union took no appeal from Bendix' denial of the employees' grievances, we hold that the union's claim also accrued on November 18, 1982, seven days after the claims were denied. 27 As is frequently the case with federal law, Congress did not create a statute of limitations to apply to actions brought under section 301. In order to give a definite period of life to a claim, the courts have traditionally borrowed the most closely analagous state statute of limitations. Recently, however, some courts have found that under certain circumstances state statutes prove inadequate to effectuate the purposes of federal labor law, and they have chosen instead to borrow federal statutes more analogous to these purposes. In so doing, they have created something resembling a national labor relations common law. The need for uniformity has also been a major consideration, and was a foundation of the argument in DelCostello. There, the Court clearly distinguished International Union, UAW v. Hoosier Cardinal Corp., 383 U.S. 696, 86 S.Ct. 1107, 16 L.Ed.2d 192 (1966), reasoning that when a case involves those consensual processes that federal labor law is chiefly designed to promote--the formation of the collective agreement and the private settlement of disputes under it, national uniformity is of greater importance. DelCostello, 462 U.S. at 162-63, 103 S.Ct. at 2289-90. 28 Even before DelCostello we had reached this conclusion in Badon v. General Motors Corp., 679 F.2d 93 (6th Cir.1982). There we stated that [w]here the parties have contracted to settle claims among themselves, their final decisions should not be exposed to collateral attack for long periods but should become final rather quickly. Id. at 98. Actions to compel arbitration present just such situations. Arbitration is a policy at the heart of federal labor law, which has been, and will continue to be greatly favored by the courts. To delay its occurrence by applying a six or twenty year state statute of limitations applicable to oral or written contracts would defeat its purpose--the speedy resolution of disputes. See Hoosier Cardinal, 383 U.S. at 707, 86 S.Ct. at 1114. It is not arbitration per se that federal policy favors, but rather final adjustment of differences by a means selected by the parties. Badon, 679 F.2d at 98 (citing U.M.W. v. Barnes & Tucker Co., 561 F.2d 1093, 1096 (3d Cir.1977)). Here, grievance arbitration procedures were written into the collective bargaining agreement, yet Bendix failed to abide by them. At that point it was the responsibility of the union and the employees to seek external remedies. 29 Unlike the claim involved in Hoosier Cardinal, an action to compel arbitration is not readily analogous to a traditional breach of contract suit where damages are sought. Unlike most contracts, collective bargaining agreements establish a grievance resolution process in order to insure a smoothly functioning labor-management relationship. Efficiency is a fundamental concern of both union and management, and the substance of these claims should be heard by a court only when the internal dispute resolution process totally breaks down. Badon, 679 F.2d at 97. Here, the union seeks only to enforce the grievance and arbitration procedures so central to the smooth operation of the process. However, it appears the union failed to move quickly enough. 30 The Court in DelCostello discussed the considerations relevant to choosing a limitations period, making it clear that the six-month period present in section 10(b) of the NLRA was the product of a purposeful balancing of interests. 31 In Section 10(b) of the NLRA, Congress established a limitations period attuned to what it viewed as the proper balance between the national interests in stable bargaining relationships and finality of private settlements, and an employee's interest in setting aside what he views as an unjust settlement under the collective-bargaining system. 32 DelCostello, 462 U.S. at 171, 103 S.Ct. at 2294 (citing United Parcel Service v. Mitchell, 451 U.S. 56, 70, 101 S.Ct. 1559, 1568, 67 L.Ed.2d 732 (1981) (Stewart, J., concurring)). Though in this case the union is the party in interest rather than the employee, the union exists for the benefit of employees and thus the interests to be balanced are the same. Here, as in Mitchell, we must consider the undesirability of suspending the grievance procedure and leaving the arbitration process in limbo for an extended period of time. 451 U.S. at 64, 101 S.Ct. at 1564-65. Just as the employee's unfair representation claim is a creature of labor law, so too, we believe, is a union's action to compel arbitration. See Mitchell, 451 U.S. at 63, 101 S.Ct. at 1564. 33 Recently, three courts have considered the limitations question in actions to compel arbitration and all have adopted section 10(b)'s six-month statute. In Federation of Westinghouse Indep. Salaried Unions v. Westinghouse Elec. Corp., the Third Circuit took its lead from the Supreme Court in DelCostello and held that the section 10(b) statute of limitations should be borrowed to apply to actions to compel arbitration under section 301. 736 F.2d 896. It stated that the application of a six-year state statute stretches out industrial disputes far longer than most recent cases have deemed desirable. It also pointed to Justice Brennan's footnote twelve in DelCostello which paved the way for the application of the six-month period to straight 301 actions. Id. at 901. That footnote read in part: 34 The suits ... here ... are amalgams, based on both an express statutory cause of action and an implied one.... We need not address whether, as a general matter, such cases should be treated differently; even if this action were considered as arising solely under Sec. 301 of the [L.M.R.A.], ... the objections to use of state law and the availability of a well-suited limitations period in Sec. 10(b) would call for application of the latter rule. 35 DelCostello, 462 U.S. at 159, n. 12, 103 S.Ct. at 2287, n. 12. This footnote, the court held, was a clear signal that the applicability of Hoosier Cardinal to section 301 suits was now an open question. 36 The Third Circuit found in Westinghouse that the application of the extremely short Pennsylvania statute governing actions to confirm arbitration awards would unnecessarily shorten the time during which parties to a collective bargaining agreement may, after exhaustion of in-house grievance steps, attempt an informal resolution of disputes. It also pointed out that grievances often involve activities which may amount to unfair labor practices, thus making it logical to apply the same statute of limitations to both. 736 F.2d at 902. 37 The Ninth Circuit held the same in Teamsters Union v. Great Western Chemical Co., 781 F.2d 764 (9th Cir.1986). It chose to apply the six-month statute of limitations of section 10(b) to an action to compel arbitration as opposed to a four year or 100 day state statute. It found the former too long, and stated that [a] long period of controversy and conflict can be a serious burden, both for the grievant and for the management, and can poison the relationship between the contracting parties that the contract was designed to establish and preserve, id. at 766, and it found that a short period for invoking judicial help was warranted. Id. However, it stated that 100 days was too short in that it unnecessarily shortened the time during which the parties could work informally toward dispute resolution. Id. at 767. 38 The Eleventh Circuit also applied the six-month period to a union's action to compel arbitration in International Ass'n of Machinists v. Allied Prod. Corp., 786 F.2d 1561 (11th Cir.1986). It based its decision primarily on the fact that 10(b) provided a closer analogy than the closest state statute, and followed its earlier decision in Samples v. Ryder Truck Lines, Inc., 755 F.2d 881 (11th Cir.1985). In Samples the court adopted the 10(b) period for a straight 301 action brought by a union to enforce an arbitration award. 39 In all of these decisions the policies involved were the same, and in each, the court chose to balance the competing interests before determining the applicable limitations period. We also believe that the enforcement of the grievance and arbitration procedures contained in the collective bargaining agreement is an important objective. We can see why the union sought to delay arbitration until it was sure that a violation had occurred. However, once such a violation becomes clear, no one is served by lengthy delay, least of all the employees whose interests the union must protect. 40 In reaching its decision to apply the six-month statute to hybrid section 301 actions, the Supreme Court reasoned that most employees are unsophisticated in collective-bargaining matters. DelCostello, 462 U.S. at 166, 103 S.Ct. at 2291. Surely it would be illogical to allow the union a greater period of time than the individual employees. The union has more knowledge of the underlying dispute, and should be more capable of discerning when an agreement has been breached and litigation is necessary. 41 We find that the six-month statute of limitations should apply here to the union's action to compel arbitration. This action is therefore barred and this portion of the district court's opinion is reversed. 42 Having determined that the six-month statute of section 10(b) applies to the claim by individual employees against the company and union under section 301, we further find that both the employees' complaint and the union's cross-claim should have been dismissed by the district court. 43 Therefore, the judgment of the district court is affirmed in part, reversed in part and remanded with directions to dismiss.