Document: 501 U.S. 190 111 S.Ct. 2215 115 L.Ed.2d 177 LITTON FINANCIAL PRINTING DIVISION, A DIVISION OF BUSINESS SYSTEMS, INC., Petitioner,v.NATIONAL LABOR RELATIONS BOARD et al. No. 90-285. Argued March 20, 1991. Decided June 13, Syllabus Among other things, the collective-bargaining agreement (Agreement) between petitioner Litton and Union representing production employees at Litton's printing plant broadly required that all differences as to contract construction or violations be determined by arbitration, specified grievances could not resolved under a two-step grievance procedure should submitted for binding provided that, in case of layoffs, length continuous service would determining factor "if things such aptitude ability [were] equal." The Agreement expired October 1979. new had been negotiated when, August September 1980 without any notice Union, laid off 10 workers its plant, including 6 most senior employees, pursuant decision close down cold-type operation. filed on behalf laidoff claiming violation Agreement, but refused submit contractual arbitration procedure, negotiate over layoff decision, arbitrate circumstances. Based precedents dealing with unilateral postexpiration abandonment procedures arbitrability, National Labor Relations Board (Board) held actions violated § 8(a)(1) (5) Act (NLRA). However, although it ordered Litton, inter alia, process through bargain order particular disputes, ruling they did "arise under" Indiana & Michigan Electric Co., 284 N.L.R.B. 53, interpretation this Court's Nolde Bros., Inc. v. Bakery Workers, 430 243, 97 1067, 51 300. Court Appeals enforced Board's order, exception portion holding arbitrable, right lay seniority if were equal, arise Agreement. Held: dispute was arbitrable. Pp. 198-210. (a) change doctrine NLRB Katz, 369 736, 82 1107, 8 230 whereby an employer violates NLRA if, bargaining impasse, effects existing term condition employment—extends cases which has negotiations one have yet completed. See, e.g., Laborers Health Welfare Trust Fund Advanced Lightweight Concrete 484 539, 544, n. 6, 108 830, 833, 98 936. since Hilton-Davis Chemical 185 241, clause does not, operation interpreted continue effect after expiration agreement. 198-200. (b) This will extend impose statutory duty disputes. Co. rule is both rational consistent NLRA, matter consent imposed beyond scope parties' Gateway Coal Mine 414 368, 374, 94 629, 635, 38 583. therefore entitled deference. If parties who favor labor during contract's also desire resolve can draft their so indicate, eliminate hiatus old execution agreement, remain until impasse. 200-201. (c) substantial Although considerable authority structure remedial orders effectuate NLRA's purposes relief deems appropriate, here based considerations, rests upon applying Bros. federal common law collective bargaining. Arbitrators courts, rather than Board, are principal sources 301 Management Act. Deferring contracts risk development conflicting principles. 201-203. (d) Nevertheless, recognized, may from express implied terms itself. Holding extensive obligation there issue expiration, supra, U.S., 255, S.Ct., 1074, found presumption disputes unless negated expressly clear implication, long arose out relation governed contract. 203-204. (e) Agreement's unlimited places within precise provisions cannot rebut presumption. P. 205. (f) announce broad post-expiration concerning conditions employment applies only where real source Absent explicit certain benefits past said involves facts occurrences before action infringes accrued vested where, normal principles interpretation, disputed survives remainder And, found, structural relating remedies resolution—e.g., provision—may some survive enforce duties It presumed intend pivotal resolution provision terminate expiration. 205-208. (g) Application foregoing reveals Since layoffs took place almost year expired, arbitrable involve rights carried satisfy these requirements and, unlike severance pay construed grant deferred compensation time already worked. primarily reference "other [factors] ability," do constant, either improve atrophy time, vary importance employer's business given moment. Thus, proceeding necessity focus whether factors equal date operation, intent freeze vest inferred. 208-210. 893 F.2d 1128 (CA9), reversed part remanded. KENNEDY, J., delivered opinion Court, REHNQUIST, C.J., WHITE, O'CONNOR, SOUTER, JJ., joined. MARSHALL, dissenting opinion, BLACKMUN SCALIA, STEVENS, Mathias J. Diederich, Torrance, Cal., petitioner. Lawrence G. Wallace, Washington, D.C., respondent support David A. Rosenfeld, San Francisco, Printing Specialties. Justice KENNEDY Court. 1 requires us determine occurred well must despite question arises context charges brought alleging unfair practice §§ (NLRA), 49 Stat. 449, amended, 29 U.S.C. 158(a)(1) (5). We interpret our earlier Workers. 300 (1977). 2 * Petitioner operated check Santa Clara, California. utilized hot-type processes. Specialties Paper Products 777, Affiliated With District Council (Union), represented plant. entered into which, extensions, remained 3, Section 19 provision: "Differences hereto regarding alleged placed clauses shall manner hereinafter set forth." App. 34. 3 21 sets forth conclusion resolved, arbitration. Id., 35. 4 Soon expire, employee sought decertification Union. conducted election 17, 1979, prevailed vote 28 27. On July 2, 1980, much postelection legal maneuvering, issued certify No period uncertainty Union's status. 5 decided test certification refusing rejected position refusal practice. Financial Division, 256 516 (1981). Meanwhile, late early 42 persons working time. worked exclusively included six eleven identical each employee, "in lengths 30. later offered instead layoffs. 7 November 24, General Counsel complaint amounted meaning 15. 4, 1981, Administrative Law Judge failing grievances. 114-115. Relying American Sink Top Cabinet 242 408 (1979), went state unresolved process, refuse them 115-118. when bypassed paid wages directly contest determination further proceedings. Over years later, affirmed Judge. 286 817 (1987). 8(a) failure so. well-recognized precedent (5), improperly See Bethlehem Steel 136 1500, 1503 (1962), pertinent part, 320 615 (CA3 1963). proceeded apply recent 53 (1987), contains current understanding arbitrability "wholesale repudiation" lacked 9 "language sufficient overcome extended arising occurring expired. [Litton] 'subject potentially viable commitment even [Agreement] expired.' " N.L.R.B., 818 (citation omitted). seek review of, we address here, committed wholesale repudiation 11 In fashioning remedy, consider Following Michigan, declared "only 'arise under' contract." 821 (citing supra ). finding about outside category, reasoned follows: 12 "The conduct triggered . experience 'a accumulated time.' 61. Electric, no indication 'the contemplated ripen enforceable Id. Therefore, grievances." 821-822. 13 provide limited backpay remedy. 14 enforcement petitioned review. (CA9 1990). question, willing "assume deciding reasonably defensible section 8(a)(5) bargain." 1137. court decided, nevertheless, erred, because thought contrary conflict two decisions, recognized contract, United Chrome Products, Inc., 288 1176 (1988), Uppco, 937 (1988). 15 cited second conflict, court's own Local Joint Executive Bd. Las Vegas Culinary Workers 226 Royal Center, 796 1159 1986). argument accruing vesting prior termination covered posttermination arbitrate. 1163. 16 writ certiorari. Because disagreement proper application Bros.,1 granted --- ----, 426, 112 410. II 17 Sections 8(d) 158(a)(5) (d), require good faith respect wages, hours, employment." taken difficult negotiations, free alter very subject those negotiations. determined, acceptance, commits employment. (1962). Katz union newly certified reach initial 936 18 Numerous mandatory NLRA. generally C. Morris, Developing 772-844 (2d ed. 1983). arrangements id., 813 cases); States Gypsum 112, 131 (1951). ruled subjects prohibition changes. identified employment, however, policy. For instance, view security dues check-off excluded permit obligations 158(a)(3) (union conditioned parties); 186(c)(4) (dues valid agreement); 55 (quoting Steel, 1502). Also, recognition strike, no-strike doctrine, except extent methods 158(d)(4), 163 (union's strike); Southwestern Supply, NLRB, 257 U.S.App.D.C. 19, 23, 806 1111, 1114 (1986). 20 241 (1970), changes, reasoning "voluntary surrender final Congress reserved [the] parties. [A]rbitration is, bottom, consensual economic power otherwise utilize." 242. relied statements acknowledging basic policy "arbitration party he agreed submit." Steelworkers America Warrior Gulf Navigation 363 574, 582, 80 1347, 1353, 1409 (1960). 173(d) (phrased method agreement). adhered B argues reject hold Katz' exclusion represent requirement faith. And "[i]f adopts then deference courts." Fall River Dyeing Finishing Corp. 482 27, 42, 107 2225, 2235, 96 22 (1987); see, Curtin Matheson Scientific, 494 110 1542, 801 (1990). think grounded strong principle, language drafting history, compulsory 57-58; supra. conforms statement "[n]o solely law. compels his contracted so." 583 (1974). reaffirm today consent, 23 absence relegated filing believes counterpart implemented If, urges, arrangement Further, might drafted impasse.2 Unlike suggestion once agree alternatives reinforce compulsory. III 24 remedy As noted above, uphold "rational Act." 2235. give greatest latitude reflects 'difficult delicate responsibility' reconciling interests management," Weingarten, 420 251, 267, 95 959, 968, 43 171 (1975). accorded appropriate. Shepard 459 344, 352, 103 665, 670-71, 74 523 (1983); Virginia Elec. Power 319 533, 540, 63 1214, 1218-19, 87 L.Ed. 1568 (1943). 25 discuss appropriate But follow accord same Shepard. Here, discussion need "to policies 1218. Rather, agreements. now defends ground "reflexively complaining regard 'complete relief' every practice," 670-71; purport rest grounds. 26 occasion agreements adjudication, see C Plywood Corp., 385 421, 559, 486 (1967), neither sole nor primary matters. "Arbitrators courts still interpretation." Strong, 393 357, 360-361, 89 541, 546 (1969). (LMRA), 185, "authorizes fashion body agreements." Textile Lincoln Mills Alabama, 353 448, 451, 77 912, 915, 972 (1957) (emphasis added). defer distinct devising follows breach revert independent 301. 1395, Int'l Brotherhood Electrical 254 360, 363-364, 797 1027, 1030-1031 IV 27 changes derived command faith, possible constraints similar This, controlled us. suit Act, compel Four days cease operations. settled wage claims, called declined resulting dispute. argued "were nature 'accrued' 'vested' rights, earned essentially basis vacation pay, payable 248, 1070. 30 "whatever outcome, claim hinges ultimately providing pay. therefore, clearly 249, 1071 original). 31 acknowledged "the creature agreement" compulsion 250-251, 1071-1072. understanding, That argument, noted, 32 "would preclude entry post-contract life proceedings begun termination. true processes began completed, term." 1072. 33 "strong reasons conclude automatically contract," 253, 1073, exclude affords concluding intended relationship," 1074. matters "negated implication," ibid., vital qualification 34 contained outlasts provides stipulations "shall specified," 22, words, longer. clause, characterizes quid pro quo "during [a]greement," Finally, "interest arbitration" unable successor 53-55, proving wished knew how clause. These arguments prevail. "[d]ifferences parties" thereof, Agreement," 34, rationale postcontract period. 35 come crux inquiry. approach object implement transcend it. sweep fact contradict 36 Any reading seems assume coincide merely applied fails recognize released respective obligations, fixed unsatisfied. change, protect bargain, longer force virtue Office Professional Employees Ins. Funds Northern California, 783 919, 922 1986) ("An [collective agreement] 'legally document.' omitted)); cf. Derrico Sheehan Emergency Hosp., 844 25-27 (CA2 1988) (Section LMRA, jurisdiction "retain significance define status quo" changes). 37 difference elemental Katz. Under They agreed-upon terms; law, least far them. acknowledges, make "rooted preservation negotiated." Brief Respondents 21. illustrates point utter clarity, barred imposing though execute first Our demonstrates distinction There, contributions pension fund. assumed constitute practice, obligation. rejected, contention ERISA "under collectively bargained accordance agreement." 1145. contribute district 502(g)(2) ERISA, 1132(g)(2), 39 cease, ordinary course, Exceptions interpretation. Rights will, general rule, agreement's continuing become provisions. Fort Pitt Casting, Division Conval-Penn, 598 1273 1979) (agreement medical event dispute). 40 resolution—for example, Bros.' LMRA commercial contracts.3 presume 41 STEVENS' dissent, argue err reaching merits post-termination because, said, arbitrator instance. Whether company bound arbitrate, what issues court, forced "arbitrate issue." AT T Technologies, Communication America, 475 643, 651, 106 1415, 1419-20, 648. acknowledge effective exists parties, "there sense '[a]n denied positive assurance susceptible covers asserted dispute.' 650, 1419 564, 582-583, 1343, 1352-1353, 1403 (1960)). limitless "[d]oubts coverage," 1419, dispute, avoid present case. legally issue, equal," 30, residual element seniority. Seniority provisions, argues, "create form advantage, understood special worked." 23-25, 14. Leaving aside requiring proceed inverse analogy viewed compensation, construed, create carries 44 ability." Only look ability—and unenumerated factors"—were light 45 important accrue compensation. Specific aptitudes abilities atrophy. skill equation varies Aptitude measured universal scale, matching infer contracting expiration.4 V 46 stated, reverse judgment entirety remanded cause 47 ordered. 48 whom SCALIA join, dissenting. I post, write separately emphasize majority's mischaracterization states broad, rebuttable agreement; leaves underlying arbitrator. Today majority turns head, announcing result unfaithful inconsistent sound labor-law 50 concerned terminated severance-pay 248-249, 1070-1071. stated "hinge[d] [of] pay" claim" implicated dispute." 1071. To looked "[t]he resort grievance-arbitration machinery" "nothing exclude[d] events occur termination." 252-253, 1072-1073.1 Nolde, key questions (1) "based differing perceptions "arises omitted), so, (2) "presumptions favoring" grossly distorts Nolde's transforming defined allegations grievance. [the Union's] 52 By contrast, holds satisfies itself challenged "infringes agreement," Ante, 206. inquiry substantive determinations passing Yet us." difficulty met here. "claim[ed] ante, 194, petitioner's concedes, clause" encompasses question." implication." 54 more rigorous standard erroneously suggests rendered extending entire defect equates asking creates rights. evidently fears arbitrators trusted decide correctly. typically expertise construing agreements, jurisprudence makes rely arbitral judgments Thus carefully avoided expressing precisely expressed preference arbitral, judicial 1070-71, 1073. Consequently, (in covering layoffs) remains enforceable. acknowledges 208, 3. stands for.2 56 addition being foundation, displacement simple, interpretive case-by-case unsound standpoint. Ironically, whereas "a prompt inexpensive expert tribunal," 254, invites protracted litigation "accrue" "vest" contract—litigation aimed More fundamentally, better equipped judges often assignment task increases likelihood error. 1073 (" 'The ablest judge expected bring competence bear grievance, similarly informed,' quoting Nav. 57 reinforces my conviction preferred resolvers questions. following contract: "[I]n assertion created rejects "factors time" thus "cannot accrue." 210. strikes me utterly implausible. 58 appears concede, 209-210, held, unconditional confer "capable degree 1176, 1177 Obviously, employee's relative seniority, like "aptitude "change time." member unit 12th expires 5th thereafter, depending number departed workforce. Or lose altogether loss met. infra. volatility individual rank, guarantee nevertheless means vests rank job 59 view, granting "qualified" way. (Here, guaranteeing possess ability" less off.) worker's made according qualified opportunity prove off. 60 Indeed, plausible case, particularly related involving previously 61 "failure specify ways lost indicates employer's] recall plantwide expiration." 937, 940 62 enumerates specific include 31.3 seem likely Uppco. event, sufficiently implausible raise serious Had left decide, requires, benefit evidentiary hearing explore actual practices. text, alone, relevant information intent. familiar 'common shop,' 1352, confidence reached sum, problematic substance underscores soundness displaces. Accordingly, dissent.4 64 65 recognizes, correct deferring line 198-203. notwithstanding grievances, exist, 203-208. Part IV-C analysis hand. am persuaded errs submitting construction. 66 (1977), against displaced closing. three permanently jobs. claimed "accrued" "vested" disavowed arguing containing giving rise dispute—the closing—occurred 67 Integral offer "There doubt 'all grievances' 'making face contract' end closing plant." 249-250, 68 Like "all grievances," mandates '[d]ifferences [and] Agreement.' 194. union's events. notes: "[T]he Agreement." 202 69 continues separate arbitrability. Whatever seniority-rights date, arbitrator, 70 respectfully dissent. Ninth Circuit's (1986), wider split authority. Third Fifth Circuits Circuit. Federated Metals 648 856, 861 (CA3), cert. denied, 454 1031, 102 567, 474 (1981); Seafarers North Marine Servs., 820 148, 152-154 (CA5), 953, 346, 372 Eighth Circuit, Tenth Supreme limit Chauffeurs, Teamsters Helpers, 238 C.R.S.T. 795 1400, 1404 (CA8 (en banc); Food Commercial AFL-CIO, Gold Star Sausage 897 1022, 1025-1026 (CA10 1990); County Ottawa Jaklinski, 423 Mich. 1, 377 N.W.2d 668 (1985) (discussing applicable public employers). Seventh finally, restricts 703, Kennicott 771 (1985). New England Newspapers, 856 409, 410 (CA1 reached); Montgomery Mailers' 127 Advertiser 827 709, 712, (CA11 1987) "for reasonable negotiation agreement"); 688 John Meier 718 286, 287 1983) ("all adopted terminated"). West ex rel. Ranger Fuel Lilly, 165 W.Va. 98, 100-101, 267 S.E.2d 435, 437-438 (1980) (duty lease); Warren Brothers Cardi 471 1304 1973) (arbitration completion work contract); Mendez Trustees Boston University, 362 Mass. 353, 356, 285 N.E.2d 446, 448 (1972) (termination "does necessarily disputes"); Batter Building Materials Kirschner, 142 Conn. 10-11, A.2d 464, 469-470 (1954) building affected party's total contract). does, necessity, layoff, able whether, fact, order. 202-203. "presume[s] 208. distinguish among types looking draw termination, Notably, contain suggesting 30-31. "Notice Layoutt" [sic ], subsections addressing, recalls. Subsection F, addresses recalling workers, "[a]n seniority." 31. "seniority" referred subsection F A, E, "supply updated list semi-annually," id. believe articulated grounds 151 seq., "an product mutual relinquish weapons, lockouts" distinguished "terms routinely perpetuated [after [statutory] doctrine]." 58. 163, interfere strike. rationally concluded employers policy, compelled forbear using concomitant union.

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