Court Opinion

ID: 3030146
Source: CourtListenerOpinion
Date Created: 2015-10-13 22:43:54.618342+00
Date Added: 2024-06-11T11:48:04.906298
License: Public Domain

United States Court of Appeals
                          FOR THE EIGHTH CIRCUIT
                               ___________

                               No. 01-2097
                               ___________

Boise Cascade Corporation,           *
                                     *
            Plaintiff/Appellee,      *
                                     *
      v.                             *    Appeal from the United States
                                     *    District Court for the
Paper Allied-Industrial, Chemical    *    District of Minnesota
and Energy Workers (PACE),           *
Local 7-0159,                        *
                                     *
            Defendant/Appellant.     *
                                ___________

                         Submitted: November 16, 2001
                            Filed : November 12, 2002
                              ___________

Before BYE and BEAM, Circuit Judges, and GOLDBERG,1 Judge.
                           ___________

GOLDBERG, Judge.

      Paper, Allied-Industrial, Chemical and Energy Workers (PACE), Local 7-0159
(the “Union”), appeals the order of the district court2 vacating an arbitral award.

      1
       The Honorable Richard W. Goldberg, Judge, United States Court of
International Trade, sitting by designation.
      2
      The Honorable Richard H. Kyle, United States District Judge for the District
of Minnesota.
Agreeing with the district court that the arbitrator’s decision did not draw its essence
from the Last Chance Agreement at issue, we affirm.

I.    BACKGROUND

       Appellee Boise Cascade Corporation (“Boise”) employed Nancy Burmeister
(“Burmeister”), a member of the Union, for nearly eleven years as a process operator
in the mill department of its pulp and paper mill in International Falls, Minnesota.
The terms and conditions of employment of Union members such as Burmeister are
protected by a collective bargaining agreement (“CBA”) between Boise and the
Union. This action arises out of Boise’s decision to terminate Burmeister’s
employment, effective February 11, 2000.

        Problems in Burmeister’s employment began to arise long before Boise fired
her. On October 26, 1996, Burmeister received a written warning from her supervisor
for failing to report to work and failing to call in. Less than a month later, she
received another written warning for reporting to work one hour and fifteen minutes
late, having unsuccessfully requested the day off after her shift was scheduled to
begin. On January 28, 1997, Burmeister called her supervisor after the start of her
shift to inform him that she would be late due to “truck trouble”; she never reported
to work and never called back that day. Two days later, she was placed on a Last
Chance Agreement3 (“LCA”) for excessive tardiness and absences; including the

      3
          An LCA is

      a contract between employer and employee to suspend disciplinary
      action pending a probationary period in which the employee is
      afforded a chance to improve his or her performance. If the employee
      fails to measure up as promised in a last chance agreement, the
      employer may proceed to administer the discipline earlier suspended,
      without reference to the collective bargaining agreement.

Coca-Cola Bottling Co. of St. Louis v. Teamsters Local Union No. 688, 959 F.2d

                                          -2-
foregoing occasions, she had missed a total of forty-five days in the preceding
thirteen months. Burmeister did not grieve either the LCA or the written warnings
that preceded it. She satisfied the conditions that the LCA imposed upon her during
a six-month probationary period, without incident.

       On May 2, 1998, when Burmeister reported to work, Boise production manager
Jim Larson (“Larson”) noticed that her breath smelled of alcohol, her speech was
slurred, and her mannerisms were different. Burmeister admitted to having recently
consumed several beers, but a urine test showed that her blood alcohol content was
actually 0.28, or nearly three times the legal limit for operating a motor vehicle in
Minnesota. Although Burmeister was subject to immediate termination for this
violation of Boise’s Drug and Alcohol Policy, Boise agreed to place her on another
LCA. This LCA required Burmeister to enroll in and complete a counseling program
through Boise’s Employee Assistance Program (“EAP”), and subjected Burmeister
to two years of random drug and alcohol testing. Using language taken verbatim
from her previous LCA, the LCA also provided:

      [Y]ou must understand that it is your responsibility and obligation to
      follow all published policies and procedures. Further violation of any
      mill rules and/or failure to comply with the Terms and Conditions of this
      Letter could result in your immediate termination. . . . Nancy, the
      Company’s expectations are clear . . . your future with Boise Cascade
      is in your hands.

(second ellipsis in original). Burmeister and her Union representative had an
opportunity to read the one-and-half-page LCA and to confer about it privately. As
the arbitrator found, Burmeister had no questions about the LCA, fully understood
what was required of her under it, and told Boise that she was “fine” with it.
Burmeister, Larson, and her Union representative all signed the LCA.

1438, 1440 (8th Cir. 1992) (brackets, quotation marks, and citations omitted).

                                        -3-
       Gradually after the 1998 LCA was implemented, Larson and Burmeister’s
supervisor began to notice a pattern whereby Burmeister would call shortly before the
start of her shift and request immediate vacation. On October 22, 1999, Burmeister
failed to report to work, without warning. Well after her shift began, she called and
requested immediate vacation, which Larson and her supervisor granted after
conferring. Upon Burmeister’s return to work, they met with her and the Union
president and informed her that she was placing her job at grave risk by returning to
her prior pattern of attendance problems, and specifically warned her not to miss any
more shifts or make any more belated vacation requests. Burmeister admitted that she
had violated Boise’s unwritten rule requiring employees to notify the company of
absences at least two hours prior to the start of a shift, and that her supervisors had
showed leniency by not enforcing the LCA and terminating her for this violation of
an unwritten attendance rule.

      On Friday, February 11, 2000, Burmeister failed to report to work for her 6:00
a.m. shift. She had not phoned her supervisor in advance, and never did call in that
day. Instead, around 8:40 a.m., Burmeister’s supervisor received a call from Larry
Matthews (“Matthews”), an EAP counselor. Matthews told the supervisor that
Burmeister “could not keep the cap on the bottle” and that he was referring her for in-
patient alcohol dependency treatment. Later that day, Matthews informed Boise’s
human resources manager that Burmeister had been unable to report to work because
she had been drinking, and asked whether Burmeister could save her job if she
entered an in-patient treatment facility that weekend. Burmeister ultimately did enter
such a facility on Sunday, February 13, 2000.

      The following Monday, Larson and the human resources director met with
Union representatives to discuss Burmeister’s situation. At the meeting, Larson
explained that Burmeister had failed to report for work or call in beforehand; that
according to Matthews, Burmeister’s use of alcohol had prevented her from reporting
to work; that Burmeister’s absence was not due to her attendance at an in-patient
treatment facility; and that after the October 22, 1999 incident, he had reminded

                                         -4-
Burmeister of her obligation not to have any more attendance problems. The Union
conceded each of these facts, but claimed that Burmeister should not be terminated
because she had begun in-patient treatment the previous day. Nevertheless, after
further consideration, Larson and Burmeister’s supervisor terminated her
employment, effective February 11, 2000. On February 15, 2000, the Union grieved
Burmeister’s termination, on the grounds that “because [Burmeister] is at this time
taking part in an in patient treatment facility, [ ] she should not be terminated.” The
grievance was denied, and the Union appealed the matter to binding arbitration as
provided by the CBA.

       Arbitration was had on August 9, 2000, before Richard John Miller
(“Arbitrator Miller”), who issued his written decision on September 14, 2000.
Arbitrator Miller rejected the Union’s assertion that he was entitled to decide whether
there existed just cause for Burmeister’s termination, observing that the LCA, rather
than the CBA, governed the dispute. Thus, he found, the sole issue was whether
Burmeister had violated the LCA. Without discussing the actual language of the
LCA, the arbitrator construed it to prohibit violations only of written rules, and
consequently determined that Burmeister’s violation of Boise’s unwritten attendance
rules did not constitute a violation of the LCA. Arbitrator Miller further explained:

      [T]he reason for the Grievant’s failure to personally call-in or be
      presence [sic] at work on February 11, 2000, cannot be construed as
      being frivolous. It is clear that the Grievant needed immediate
      assistance through the EAP on that day to get herself into an in-patient
      alcohol treatment program as soon as possible, since this disease was
      controlling both her personal and working relationships. There is
      nothing in the LCA which prevented the Grievant from seeking
      assistance through the EAP for her alcohol problem. The fact that she
      was not admitted to in-patient treatment until February 13, 2000, is a
      function of the availability of a suitable treatment center.

                                         -5-
In sustaining the grievance, the arbitrator ordered Boise to reinstate Burmeister to her
former position with full seniority and to pay her back wages from March 8, 2000, the
date of her discharge from the in-patient treatment facility.

       Boise brought suit in federal district court, seeking to have the arbitral award
vacated. It filed a motion for summary judgment, and the Union filed a cross-motion
requesting confirmation of the award. The district court granted Boise’s motion and
vacated the arbitral award, holding that the award failed to draw its essence from the
parties’ agreement. The court found that the plain language of the LCA did not
support the arbitrator’s decision; that the arbitrator failed to discuss the operative
terms of the LCA; and that the arbitrator ignored the parties’ intent when they entered
into the LCA.

      The Union timely appealed the district court’s order. We have jurisdiction
pursuant to 28 U.S.C. § 1291 (2000).

II.   DISCUSSION

      In reviewing a district court’s order confirming or vacating an arbitral award,
we accept the court’s findings of fact that are not clearly erroneous,4 but decide
questions of law de novo. First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938,
947-48 (1995); accord Titan Wheel Corp. of Iowa v. Local 2048, Intern. Ass’n of
Machinists, 253 F.3d 1118, 1119 (8th Cir. 2001). However, we must accord “an
extraordinary level of deference” to the underlying award itself. Keebler Co. v. Milk

      4
        The facts of this case are undisputed. In district court, the parties stipulated
that the evidence and testimony submitted to the arbitrator, along with the arbitrator’s
findings of fact, would constitute the entire factual record on which the court could
base its decision. We have adopted those facts in turn. In any event, we could not
reject the arbitrator’s findings of fact even if they were “improvident” or “silly.”
Major League Baseball Players Ass’n v. Garvey, 532 U.S. 504, 509 (2001); but see
id. at 513 n.* (Stevens, J., dissenting) (noting ambiguity in this standard).

                                          -6-
Drivers & Dairy Officials Union, Local No. 471, 80 F.3d 284, 287 (8th Cir. 1996).
As the district court rightly observed, federal courts are not authorized to reconsider
the merits of an arbitral award, “even though the parties may allege that the award
rests on errors of fact or on misinterpretation of the contract.” Bureau of Engraving,
Inc. v. Graphic Communication Int’l Union, Local 1B, 284 F.3d 821, 824 (8th Cir.
2002) (quoting United Paperworkers Int’l Union v. Misco, Inc., 484 U.S. 29, 36
(1987)). Indeed, we must confirm the award even if we are convinced that the
arbitrator committed serious error, so “long as the arbitrator is even arguably
construing or applying the contract and acting within the scope of his authority.”
Bureau of Engraving, 284 F.3d at 824 (quoting Misco, 484 U.S. at 38).

       However, an arbitrator’s decision is not totally free from judicial review, for
“although the arbitrator’s authority is broad, it is not unlimited.” Missouri River
Servs., Inc. v. Omaha Tribe of Nebraska, 267 F.3d 848, 855 (8th Cir. 2001) (internal
brackets omitted) (quoting Trailmobile Trailer, LLC v. Int’l Union of Elec. Workers,
223 F.3d 744, 747 (8th Cir. 2000)), cert. denied 122 S. Ct. 1909. In addition to those
grounds for vacation of an award set forth in the Federal Arbitration Act, 9 U.S.C. §
10 (2000) (listing such reasons as the arbitrator’s corruption, fraud, evident partiality,
misconduct, or ultra vires acts), courts have vacated arbitral awards that are
“completely irrational” or that “evidence[] a manifest disregard for the law.”
Hoffman v. Cargill Inc., 236 F.3d 458, 461 (8th Cir. 2001) (quoting Val-U Constr.
Co. v. Rosebud Sioux Tribe, 146 F.3d 573, 578 (8th Cir. 1998)). An award is
“irrational where it fails to draw its essence from the agreement”; it “manifests
disregard for the law where the arbitrators clearly identify the applicable, governing
law and then proceed to ignore it.” Id. at 461-62. “An arbitrator’s award draws its
essence from the [parties’ agreement] as long as it is derived from the agreement,
viewed in light of its language, its context, and any other indicia of the parties’
intention.” Johnson Controls, Inc., Sys. & Servs. Div. v. United Ass’n of
Journeymen, 39 F.3d 821, 825 (7th Cir. 1994) (internal quotation marks omitted).

                                           -7-
       In this case, the district court found that the plain language of the LCA was
unambiguous and was not susceptible of the arbitrator’s interpretation that it
prohibited violations of only published mill rules. The court found that while the first
sentence of the relevant paragraph did instruct Burmeister to “follow all published
policies and procedures,” the second sentence enjoining her from “[f]urther violation
of any mill rules” stood alone, and could not be read as referring only to published
mill rules. The court further held that because the arbitrator failed to quote the
relevant language and failed to discuss how he arrived at his interpretation, and
because his interpretation contravened the parties’ intent, the award did not draw its
essence from the LCA.

       If we owed aught but maximum deference to the arbitrator’s ruling, we would
likely affirm the district court’s order vacating the arbitral award based on the plain
text of the LCA alone. As the district court reasoned, the first sentence in question
sets forth Burmeister’s obligations under the LCA, and the second sentence explains
the sanction attached to failure to adhere to those conditions or to any other violation
of any mill rule.

        However, it is not our construction of the LCA for which the parties bargained,
but Arbitrator Miller’s. See Trailmobile Trailer, 223 F.3d at 747. We may not vacate
the award simply because we disagree with his interpretation, unless that
interpretation so directly contradicts the plain meaning of the parties’ agreement that
it effectively rewrites it. See, e.g., Amalgamated Transit Union, Local No. 1498 v.
Jefferson Partners, 229 F.3d 1198, 1200-01 (8th Cir. 2000) (“The arbitrator, however,
is not free to ignore or abandon the plain language of the [parties’ agreement], which
would in effect amend or alter the agreement without authority.” (internal quotation
marks omitted) (citing Excel Corp. v. United Food & Commercial Workers Int’l
Union, Local 431, 102 F.3d 1464, 1468 (8th Cir. 1996))); Coca-Cola Bottling Co. of
St. Louis v. Teamsters Local Union No. 688, 959 F.2d 1438, 1440 (8th Cir. 1992)
(“The arbitrator did not have the authority to alter the agreement by interpreting
unambiguous language in a way contrary to its plain meaning.”). Even if Arbitrator

                                          -8-
Miller’s interpretation does not rise to that level,5 our inquiry--contrary to the
contentions of the Union and the dissent–is not complete.

        As we have previously recognized, “[i]f 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 [agreement].” Bureau of Engraving,
Inc. v. Graphic Communications Int’l Union, Local 1B, 164 F.3d 427, 429 (8th Cir.
1999) (vacating awards that were inconsistent with the parties’ past practices and
their intent as evidenced by CBA negotiations). An arbitrator’s paramount obligation
is to apply the parties’ agreement in a way that gives effect to their intent. Id. at 429
(“‘[D]etermining the intent of the parties is the essential inquiry’; if the written
agreement is silent, the arbitrator may consider past practice and bargaining history
to fill gaps.” (quoting CSX Transp., Inc. v. United Transp. Union, 29 F.3d 931, 936
(4th Cir. 1994))). In Int’l Woodworkers v. Weyerhaeuser Co., 7 F.3d 133 (8th Cir.
1993), we explained:

      5
        Judge Beam reads the phrase “[f]urther violation of any mill rules . . . could
result in your immediate termination” to be unambiguous and not susceptible of the
arbitrator’s interpretation, and would first affirm the district court on that basis. Post
at 18. While I agree that the clause is clear, I also believe that its juxtaposition with
the preceding reference to “published policies and procedures” imparts some measure
of ambiguity. Of course “there are degrees of ambiguity and clarity in most
language,” Lattimer-Stevens Co. v. United Steelworkers Dist. 27, 913 F.2d 1166,
1171 (6th Cir. 1990) (Boggs, J., dissenting), but while the degree of ambiguity here
is slight enough that I would readily adopt the district court’s reading were our review
of the award de novo, the standard we must apply is exceptionally forgiving. The
plain text must be stretched to reach the arbitrator’s interpretation, but not beyond its
breaking point.
        Whatever ambiguities lie within the four corners of the LCA, as discussed infra
its meaning is plainly unambiguous when read in the context of the parties’ history
and intent, and by ignoring all evidence of that history and intent the arbitrator
exceeded his authority. On this point Judge Beam and I are in complete agreement.

                                           -9-
      [W]hen the arbitrator construed [an] ambiguous provision without
      seeking the parties’ guidance as to its intent and without evidence of
      their relevant past practices, he acted without considering the entire
      agreement. In these circumstances we do not simply disagree with his
      interpretation of the Agreement; we conclude that he dispensed his own
      brand of industrial justice, and his award cannot be said to draw its
      essence from the collective bargaining agreement.

7 F.3d at 136-37 (internal citations omitted).

       Noting that we have sometimes vacated arbitral decisions where the arbitrator
strayed beyond the four corners of the parties’ agreement, the Union argues that the
arbitrator properly limited himself to the language within the LCA and rendered a
reasonable interpretation of an ambiguous paragraph. This argument rests on a
misunderstanding of our prior decisions. Certainly, we have vacated awards where
the arbitrator ignored or went beyond the plain text of the parties’ agreement, and that
text was unambiguous. For example, in Keebler, we vacated an award because the
arbitrator improperly looked to a settlement letter and past practice to discern the
parties’ intent when the CBA and an incorporated side agreement were unambiguous.
We found that he was “not construing an ambiguous contract term, but rather was
imposing a new obligation upon” the company. 80 F.3d at 288. See also Excel
Corp., 102 F.3d at 1468 (vacating award where arbitrator relied on parole evidence
though “the language of the contract is clear and unambiguous”); Coca-Cola, 959
F.2d at 1440-42 (arbitrator improperly ignored plain language of LCA); Anheuser-
Busch, Inc. v. Local Union No. 744, 280 F.3d 1133, 1139 (7th Cir. 2002) (arbitrator
may not consider law of shop if agreement is unambiguous), petition for cert. filed
71 U.S.L.W. 3240 (Oct. 7, 2002) (No. 02-143). In so doing, we have simply followed
the longstanding principle that the arbitrator is not free to alter or amend the parties’
agreement, unless expressly authorized to do so. Thus, where the plain text of the
agreement is unmistakably clear, it is presumed to evince the parties’ intent, and the

                                          -10-
arbitrator normally need look no further, but must give effect to the parties’
agreement as written.6

       On the other hand, where the plain language of the parties’ agreement is silent
or ambiguous with respect to a disputed issue, an arbitrator is obliged to consider
other relevant sources of the parties’ intent. Graphic Communications, 164 F.3d at
429. An LCA, like the collective bargaining agreement that it supersedes,

      calls into being a new common law--the common law of a particular
      industry or of a particular plant. . . . [T]he labor arbitrator’s source of
      law is not confined to the express provisions of the contract, as the
      industrial common law--the practice of the industry and the shop--is a
      part of the [LCA] although not expressed in it.

Jefferson Partners, 229 F.3d at 1201-02 (quoting Int’l Woodworkers, 7 F.3d at 135,
quoting in turn United Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574,
579 (1960)). See also Trailway Lines, Inc. v. Trailways, Inc. Joint Council, 807 F.2d
1416, 1423 (8th Cir. 1986) (by ignoring company’s past practice of prohibiting beards
on employees in contact with the public, arbitrator “ignored an extremely relevant
source of common law--the law of the shop”). None of these extrinsic sources for
divining the parties’ intent “substitute[] for or supplant[] the language of the contract,
but they all help interpret ambiguities in that language.” NCR Corp., E & M Wichita
v. Int’l Ass’n of Machinists, Dist. Lodge No. 70, 906 F.2d 1499, 1501 n.3 (10th Cir.
1990).

       Thus, contrary to the Union’s suggestion, federal courts routinely confirm
arbitral awards where the arbitrator has looked to outside sources for guidance in

      6
        In limited circumstances, even unambiguous language may be trumped by
other evidence of the parties’ intent if it is abundantly clear that the language does not
reflect their intent. See Loveless v. Eastern Air Lines, Inc., 681 F.2d 1272, 1279-80
(11th Cir. 1982); but see Lyster v. Ryan’s Family Steak Houses, Inc., 239 F.3d 943,
946 (8th Cir. 2001).

                                          -11-
giving meaning to ambiguous language. See, e.g., Fairview Southdale Hosp. v.
Minnesota Nurses Ass’n, 943 F.2d 809, 812 (8th Cir. 1991) (per curiam) (“[The]
arbitrator did not violate the essence of the collective bargaining agreement by
looking first to the agreement, and then beyond the agreement to past practices for
resolution of an issue on which the agreement is ambiguous or silent.”); CSX Transp.,
Inc. v. United Transp. Union, 29 F.3d 931, 936-37 (4th Cir. 1994); Manville Forest
Products Corp. v. United Paperworkers Int’l Union, 831 F.2d 72, 76 (5th Cir. 1987);
Ladish Co. v. Int’l Ass’n of Machinists & Aerospace Workers, Dist. No. 10, 966 F.2d
250, 253 (7th Cir. 1992); NCR Corp., E & M Wichita v. Int’l Ass’n of Machinists,
Dist. Lodge No. 70, 906 F.2d 1499, 1505-06 (10th Cir. 1990). Conversely, as noted
above, we have vacated awards where the arbitrator failed to consider such sources
when to do so was vital to determine the parties’ intent. See, e.g., Graphic
Communications, 164 F.3d at 429-30; Int’l Woodworkers, 7 F.3d at 135-37.7

      7
        The dissent does not address any of the foregoing precedent, but simply recites
Supreme Court cases restating the long-established principle that courts owe
maximum deference to an arbitrator’s decision and may not vacate an award so long
as the “arbitrator is even arguably construing or applying the contract and acting
within the scope of his authority.” Major League Baseball Players Ass’n v. Garvey,
532 U.S. 504, 509 (2001), cited post at 19-20. As the above discussion makes clear,
however, an arbitrator does not construe the contract and does not act within his
authority when he either ignores unambiguous language or construes ambiguous
language without any reference to the parties’ intent.
       The dissent is surely correct that an arbitrator’s “mere failure to recognize a
contract’s ambiguity” does not in itself give cause for vacation of the award. As
discussed infra at 14 n.9, courts may not vacate an award unsupported by any
discussion of the arbitrator’s reasons, so long as “its essence is consistent with the
spirit and reason of the parties’ agreement.” See United Food & Commercial
Workers, Local No. 88 v. Shop ‘N Save Warehouse Foods, Inc., 113 F.3d 893, 897
(8th Cir. 1997). A fortiori, if the arbitrator fails to discuss a relevant ambiguity but
the court’s own review finds that extrinsic evidence of the parties’ intent is itself
ambiguous or silent or not plainly dispositive of the issue, the award will stand. On
the other hand, if the arbitrator has ignored the ambiguity, and the court’s own inquiry
leads it to conclude that the arbitrator would likely have reached a different result had
he recognized the ambiguity and sought to resolve it, then the award must be vacated.

                                          -12-
       Of course, the arbitrator must restrict his inquiry to evidence that will aid him
in divining the parties’ intent; he may not rely on outside sources not within the
parties’ contemplation at the time they drafted their agreement. Compare NCR Corp.,
906 F.2d at 1501 (where plain language was unclear, arbitrator properly considered
“other terms in the contract; the negotiating and contractual history of the parties,
which would also help reveal their intent; evidence of past practices; [prior arbitral
and judicial decisions]; and the common law of the shop”), with Alvey, Inc. v.
Teamsters Local Union No. 688, 132 F.3d 1209, 1212-13 (8th Cir. 1997) (vacating
arbitral decision that looked to Missouri state criminal and evidence law to determine
that grievant placed on probation following guilty verdict was not “convicted”;
“[i]nstead of looking at the word in context, taking into account its ordinary meaning
and any pertinent plant practices or history, the arbitrator adopted his own, hyper-
technical meaning derived from a contextually inapposite source”).

       In this case, Arbitrator Miller did not discuss the language concerning “any
mill rules,” did not recognize its ambiguity, and consequently did not consider other
evidence of the parties’ intent. Had he done so, yet still reached the same result, his
decision would have rested on a legitimate interpretation of the parties’ agreement.
In the absence of other strong evidence that he was merely dispensing his own brand
of industrial justice, we would be obliged to confirm the award, even if we disagreed
with his reasoning and conclusion. Instead, given the decision’s silence on this
crucial issue, we cannot know whether Arbitrator Miller simply overlooked the
obvious ambiguity or whether he obliquely construed it in a hyper-technical fashion,
although his admission that the result “may be unfair” to Boise suggests the latter.8

Cf. Clinchfield Coal Co. v. Dist. 28, United Mine Workers, 720 F.2d 1365, 1369 (4th
Cir. 1983) (“Where, as here, the arbitrator fails to discuss critical contract
terminology, which terminology might reasonably require an opposite result, the
award cannot be considered to draw its essence from the contract.”).
      8
       Arbitrator Miller explained that he “had no other alternative but to strictly
interpreted the essence of the LCA, which unfortunately was to the detriment of the
Employer who agreed to terminating the Grievant for only violations of published

                                         -13-
In either event, “[w]e believe that where an arbitrator fails to discuss a probative
contract term, and at the same time offers no clear basis for how he construed the
contract to reach his decision without such consideration, there arises a strong
possibility that the award was not based on the contract.” George A. Hormel & Co.
v. United Food & Commercial Workers, Local 9, 879 F.2d 347, 351 (8th Cir. 1989);
accord Coca-Cola, 959 F.2d at 1442.9

rule and procedures.” [sic]
      9
        The Union suggests that because “[a]rbitrators need not even articulate reasons
for their decisions,” Hoffman, 236 F.3d at 463 (citing Alexander v. Gardner-Denver
Co., 415 U.S. 36, 58 (1974)), we cannot rely on the arbitrator’s failure to discuss the
LCA’s ambiguity as a basis to vacate the award. We reject that proposition out of
hand. Certainly we will not vacate an award simply because an arbitrator does not
issue a written decision or fully explain his reasoning, so long as “its essence is
consistent with the spirit and reason of the parties’ agreement.” United Food &
Commercial Workers, Local No. 88 v. Shop ‘N Save Warehouse Foods, Inc., 113
F.3d 893, 897 (8th Cir. 1997) (explaining that arbitral decision may still draw its
essence from the parties’ agreement though it is poorly worded and its reasoning on
subsidiary points is questionable).
       However, where we have reason to suspect that the arbitrator’s decision fails
to draw its essence from the parties’ agreement, we are not obliged to ignore our
suspicions, even if they are based on deficiencies in the arbitrator’s written decision.
In such circumstances, federal courts have repeatedly vacated arbitral decisions that
failed to discuss probative terms. See, e.g., Champion Int’l Corp. v. United
Paperworkers Int’l Union, 168 F.3d 725, 731 (4th Cir. 1999) (arbitrator’s failure to
address certain contractual provisions was “evidence of a basic abdication of [his]
duty to apply the contract that governs the grievance”); Hormel, 879 F.2d at 351-52;
Clinchfield Coal Co. v. Dist. 28, United Mine Workers, 720 F.2d 1365, 1369 (4th Cir.
1983) (“Where, as here, the arbitrator fails to discuss critical contract terminology,
which terminology might reasonably require an opposite result, the award cannot be
considered to draw its essence from the contract.”); see also Halligan v. Jaffray, 148
F.3d 197, 204 (2d Cir. 1998) (“[W]hen a reviewing court is inclined to hold that an
arbitration panel manifestly disregarded the law, the failure of the arbitrators to
explain the award can be taken into account.”). Cf. American Nat’l Can Co. v. United
Steelworkers, 120 F.3d 886, 893 (8th Cir. 1997) (confirming arbitral award despite
its conflict with precedent because arbitrator “specifically identified the critical

                                         -14-
       While Arbitrator Miller may have mistakenly believed that he was required to
give a strict interpretation of the LCA, however unfair the result to Boise, other
language in his decision suggests that he was motivated to dispense his own brand of
industrial justice. Although the arbitrator stated that the sole issue before him was
whether Burmeister had violated the LCA, he effectively undertook a “just cause”
analysis, finding that Burmeister’s absence was not “frivolous” because her absence
was caused by a desire to enter an in-patient counseling program.10 The Union argues
that Arbitrator Miller’s discussion of the reason for Burmeister’s absence constitutes
an alternative basis for his award, on the grounds that the LCA’s choice of modal
verb in the phrase “could result in your immediate termination” vested discretion in
the arbitrator to determine whether termination was appropriate. The Union’s
reliance on our decision in Trailmobile Trailer is misplaced, however; in that case,
the arbitrator was interpreting a just cause provision in a CBA that expressly gave
him such power. 223 F.3d at 745-46.

      By contrast, an LCA such as the one at issue here renders the just cause
provision in the parties’ CBA irrelevant. See Coca-Cola, 959 F.2d at 1440 (“‘[J]ust

factual differences”). The Union’s suggestion that this principle creates an incentive
for arbitrators to refuse to issue written decisions ignores the practical reality that any
arbitrator who did so would suffer a grave loss of professional esteem among the
parties, typically repeat players, that jointly contract for his services.
      10
         This conclusion directly contradicted the arbitrator’s finding of fact, conceded
ab initio by the Union, that Burmeister’s absence on February 11, 2000, was caused
by her use of alcohol, rather than any in-patient treatment obligation. To be sure, an
arbitral decision need not be a model of internal consistency or coherence, but where
an arbitrator’s conclusion is wholly inconsonant with his fact-finding, it suggests that
he was not fulfilling his obligation to interpret and apply the parties’ agreement. Cf.
Excel Corp., 102 F.3d at 1469 (finding that arbitrator had dispensed his own brand
of industrial justice, and noting that arbitrator’s own factual findings directly
contradicted his ultimate ruling); Iowa Mold Tooling Co. v. Teamsters Local Union
No. 828, 16 F.3d 311, 312 (8th Cir. 1994) (vacating award where arbitrator “promptly
abandoned his own admonition” to conform to federal law).

                                           -15-
cause’ under the terms of the collective bargaining agreement was irrelevant to [the
grievant’s] discharge pursuant to the last chance agreement and should not have been
considered. The last chance agreement superseded the collective bargaining
agreement.”); Ohio Edison Co. v. Ohio Edison Joint Council, 947 F.2d 786, 787 (6th
Cir. 1991) (arbitrator lacked authority to set aside last chance agreement on grounds
that grievant’s discharge was “too harsh”). Even a de minimis violation of an LCA
entitles the employer to impose the sanction provided for under the LCA. See Coca-
Cola, 959 F.2d at 1442; see also Tootsie Roll Indus., Inc. v. Local Union No. 1, 832
F.2d 81, 83-85 (7th Cir. 1987) (vacating arbitrator’s decision that second absence,
excusable under company’s general attendance policy, did not violate LCA’s ban on
more than one absence per month “for any reason”). Indeed, Arbitrator Miller
recognized that discretion to terminate Burmeister upon a violation of the terms of the
LCA was vested solely in Boise. Thus, we find his discussion of her purportedly non-
frivolous reason for being absent disturbing, as it suggests “efforts to balance the
equities of the situation, rather than to interpret and apply the agreement.” St. Louis
Theatrical Co. v. St. Louis Theatrical Bhd. Local 6, 715 F.2d 405, 409 (8th Cir. 1983)
(vacating arbitral award).

       Had Arbitrator Miller considered the parties’ intent in drafting the 1998 LCA,
as informed by their past practice, we do not believe he would have reached the same
result, for there is abundant evidence that the parties did not intend or understand the
LCA to mean that Burmeister’s violations of the unwritten attendance rules could not
lead to her termination. To begin with, the plain language of the LCA becomes more
meaningful when viewed in light of the history between the parties. The sentence that
the arbitrator effectively ignored enjoins Burmeister from “[f]urther violation of any
mill rules”; it plainly refers to rules that Burmeister had previously violated.
Burmeister had previously received two written warnings and was placed on her first
LCA for violations of Boise’s unwritten attendance rules. The ambiguous paragraph
at issue here was copied verbatim from the first LCA, which was created to address
those violations. While Burmeister was placed on the second LCA because she came
to work intoxicated, the parties clearly recognized the relationship between

                                         -16-
Burmeister’s abuse of alcohol and her attendance problems; it is absurd to suppose
that they meant to address the one and not the other.

      Any possible doubt as to the parties’ understanding of Burmeister’s obligations
under the 1998 LCA is vitiated by her acknowledgment that her violation of
attendance rules on October 22, 1999, warranted her termination under the terms of
the LCA. The Union argues that Burmeister’s understanding is irrelevant, as it made
no such concession. However, Burmeister is an independent signatory of the 1998
LCA, so her understanding of its requirements is clearly relevant. We also note that
the Union’s own stated ground for grieving her termination was not that the LCA did
not prohibit violations of Boise’s unwritten attendance rules, but that she should not
be terminated because she had begun in-patient treatment.11 Nor did either
Burmeister or her Union representatives demur when she was reminded, shortly after
October 22, 1999, that further violations of Boise’s attendance rules would be
grounds for termination. The Union’s post hoc rationalizations notwithstanding, it
is clear that in adopting the 1998 LCA, Boise, Burmeister, and the Union all
understood that Burmeister could be terminated for violations of Boise’s unwritten
attendance rules.

       In this case, there is abundant evidence that the arbitrator’s decision did not
consider the parties’ intent, that it contravenes that intent, and that “additional facts
exist that strongly indicate that the arbitrator did not premise his award on the

      11
        The Union argues that it was incumbent upon Boise expressly to provide that
Burmeister could be terminated for violations of unwritten attendance rules. We
disagree. We think it was reasonable for Boise to suppose that language taken
verbatim from Burmeister’s first LCA, which was intended to address Burmeister’s
attendance problems, would have the same effect when used in the second LCA. The
one-and-a-half page LCA at issue here (unlike a typical CBA) was not intended to be
a complex legal contract; in drafting it, Boise already had grounds to dismiss
Burmeister, and was simply giving her a last chance to alter her behavior. For these
reasons, we decline the Union’s suggestion to apply the contract law principle that
ambiguities should be interpreted to the detriment of the drafter.

                                          -17-
contract, notwithstanding his words to the contrary.” Hormel, 879 F.2d at 350
(emphasis omitted). In these circumstances, we do not merely disagree with the
arbitrator’s decision; rather, we find that his award fails to draw its essence from the
parties’ agreement. See Int’l Woodworkers, 7 F.3d at 136-37. Accordingly, we
affirm the order of the district court vacating the arbitral award.

BEAM, Circuit Judge, concurring.

       I am pleased to concur in the result reached by Judge Goldberg. However, I
do so because I agree with the district court that the Last Chance Agreement (LCA)
was unambiguous and was not susceptible to the arbitrator’s interpretation that it
prohibited violation of only published mill rules. However, I also agree with Judge
Goldberg’s conclusion that even if there is some measure of ambiguity in the LCA,
the arbitrator attempted to interpret the LCA without proper consideration of the
parties’ intent, contrary to established precedent.

BYE, Circuit Judge, dissenting.

       The majority rejects the arbitrator's reading of the Last Chance Agreement
(LCA) because he failed to recognize and resolve an ambiguity by examining the
parties' intent. From this analysis, the majority concludes the arbitrator's award "fails
to draw its essence from the parties' agreement." Ante at 17. We cannot reject the
arbitrator's reading of the parties' agreement merely because he failed to recognize
an ambiguity. Nor does it follow that from such a failure the arbitral award fails to
draw its essence from the parties' agreement. For both reasons, I respectfully dissent.

       The majority acknowledges that the operative text in the LCA does contain
"some measure of ambiguity." Id. at 9 n.5. I agree. Its reference to "any mill rule"
comes directly after a statement that it will be Burmeister's responsibility to comply
with published policies and procedures. This arrangement of text can reasonably be
interpreted to mean that the type of "rules" referred to in the second sentence are more

                                          -18-
specifically defined in the first sentence as all "published" policies and procedures.
Because Burmeister's actions were not in violation of any published policy or
procedure, the arbitrator reasonably concluded she did not violate the terms of the
LCA.

      Whether the arbitrator properly or improperly interpreted the LCA, there is no
question the arbitrator endeavored to interpret the LCA. That was the parties'
bargain, and therefore we should not interfere with the arbitrator's award. "A court
cannot interfere with the arbitrator's award unless it can be said with positive
assurance that the contract is not susceptible of the arbitrator's interpretation." United
Food & Commercial Workers, Local No. 88 v. Shop 'N Save Warehouse Foods, Inc.,
113 F.3d 893, 895 (8th Cir. 1997) (internal quotations and citations omitted); see
Keebler Co. v. Milk Drivers & Dairy Employees Union, Local No. 471, 80 F.3d 284,
288 (8th Cir. 1996) ("We could not disturb the arbitrator's award if he interpreted
ambiguous language in the collective bargaining agreement or side agreement to
support his conclusion that Keebler could not transfer this account without the
agreement of the Union, even if his interpretation of the agreement had been
erroneous.").

       In other words, this is not a case where an arbitrator ignored an ambiguity, and
set aside his concomitant obligation to examine the parties' intent, in order to dispense
his own brand of industrial justice. This is a case where an arbitrator undertook his
obligation to construe and apply the parties' agreement, and in doing so deemed a
provision in the agreement to be unambiguous by adopting a reasonable
interpretation. While we can all agree the arbitrator failed to recognize the
provision's ambiguity, that error does not justify our interference with the award. See
Major League Baseball Players Ass'n v. Garvey, 532 U.S. 504, 509 (2001) ("Courts
are not authorized to review the arbitrator's decision on the merits despite allegations
that the decision rests on factual errors or misinterprets the parties' agreement.").

                                          -19-
       Nor does it follow that by failing to recognize the provision's ambiguity, the
arbitrator arrived at an award that failed to draw its essence from the agreement. The
Supreme Court has stressed time and again "that if an 'arbitrator is even arguably
construing or applying the contract and acting within the scope of his authority,' the
fact that 'a court is convinced he committed serious error does not suffice to overturn
his decision.'" Id. (quoting E. Associated Coal Corp. v. Mine Workers, 531 U.S. 57,
62 (2000) (in turn quoting Paperworkers v. Misco, Inc., 484 U.S. 29, 38 (1987))
(emphasis added). An arbitrator's mere failure to recognize a contract's ambiguity
cannot and does not amount to a failure to construe or apply the contract. The
majority's conclusion to the contrary ignores clear Supreme Court precedent, and thus
I am obliged to dissent.

      A true copy.

             Attest:

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

                                         -20-