Court Opinion

ID: 6975516
Source: CourtListenerOpinion
Date Created: 2022-07-24 02:10:19.604829+00
Date Added: 2024-06-11T16:08:56.588665
License: Public Domain

DAVID A. NELSON, Circuit Judge,
dissenting.
Where a labor arbitrator’s award “draws its essence” from a relevant collective bargaining agreement, and “the arbitrator is even arguably construing or applying the contract and acting within the scope of his authority,” it is clear that the courts must accept the award regardless of whether they happen to agree with the arbitrator’s factual findings or even with his logic. United Paperworkers Int’l Union v. Misco, Inc., 484 U.S. 29, 36, 38, 108 S.Ct. 364, 98 L.Ed.2d 286 (1987) (citations omitted). On this point there is no dispute between my colleagues and me.
But where the parties to the relevant collective bargaining agreement have agreed to the contract’s termination, and the arbitrator, ignoring this fact, appears to have applied a contract covering a bargaining unit of which the aggrieved employees were not members, I question whether the arbitrator’s award can properly be said to draw its “essence” from the relevant contract. I cannot be totally sure, given .the Byzantine complexity of the TVA’s collective bargaining arrangements, but it looks to me as though the arbitrator in the case at bar applied the wrong contract. In the course of doing so, I believe, he mandated the de facto resurrection of a bargaining unit that had been lawfully terminated by mutual agreement. I would therefore remand the case for reconsideration in light of circumstances of which TVA has probably given us a better explanation than it gave the arbitrator.
*773The pertinent background, as I understand it, is this. From at least the early 1970s until May of 1986, hourly-paid employees (also known as “temporary” or “hourly” employees) who worked on the maintenance and repair of TVA’s power generating and transmission facilities were members of a collective bargaining unit that also included salaried employees. (The salaried employees are called “annual employees.”)
As long as they were members of the same bargaining unit, the hourly employees and the annual employees were both covered by a collective bargaining agreement originally negotiated in 1940 and revised a number of times thereafter. The title page of the 1988 edition of this contract identified the instrument as the “GENERAL AGREEMENT ... And Supplementary Schedules_ COVERING ANNUAL AND HOURLY OPERATING AND MAINTENANCE EMPLOYMENT.”
In 1986 the hourly employees were taken out of then' former bargaining unit and placed in a separate unit consisting entirely of hourly employees. A separate collective bargaining agreement was negotiated for the new unit. The title page of the most recent edition of the collective bargaining agreement covering hourly employees is reproduced below:
[[Image here]]
One of the “Supplementary Schedules” incorporated in this hourly collective bargaining agreement was called “Schedule B-hourly.” It was “Schedule B-hourly,” I gather, that defined the positions at issue in this litigation.
In contradistinction to hourly employees, annual employees continued to be covered by the 1940 general agreement, as revised from time to time. The title page of the 1991 edition of the general agreement for annual employees looks like this:
*774[[Image here]]
It was this General Agreement — a contract that likewise had a Schedule B, but that covered only “ANNUAL OPERATING AND MAINTENANCE EMPLOYEES” — to which the arbitrator repeatedly referred, and from which he quoted, in his second supplemental award. The second supplemental award ordered that 40 hourly employees be reinstated with back pay.
Nothing in the language of his award suggests that the arbitrator was even aware that there had been a separate general agreement covering hourly employees. We were assured at oral argument that, given his intimate familiarity with TVA’s labor relations picture, the arbitrator must have known about the collective bargaining agreement for hourly employees. My confidence in the reliability of this assurance would be greater, I confess, if the arbitrator’s award had contained at least a passing reference to the contract by which the hourly employees’ conditions of employment had been governed since 1986.
As I read the award, it clearly manifests an erroneous understanding that there was only one collective bargaining unit, covering both annual and hourly employees. Conditions of employment for that unit, the arbitrator evidently thought, were governed by one General Agreement. The arbitrator’s mental image of TVA’s bargaining unit structure was thus seven years out of date.
Not only does the arbitrator seem to have been unaware that “the” bargaining unit to which he kept referring had long since been split in two, he seems also to have been unaware that there had been an agreement to abolish the hourly bargaining unit altogether. TVA did not explain this very well to the arbitrator, but in May of 1991, TVA tells us, the collective bargaining representative of the employees in the hourly bargaining unit agreed to the abolition of that unit *775and the termination of the general agreement covering hourly employees. The fact that termination was agreed to is undisputed. See, for example, the appellate brief of the International Association of Machinists and Aerospace Workers, which explicitly says that “the Original [Tennessee Valley Trades and Labor] Council agreed to eliminate its hourly bargaining unit agreement.”1
TVA’s primary argument before the district court, we are told in the agency’s brief on appeal, was that “the Council had agreed that TVA would eliminate its hourly bargaining unit and that contrary to the Council’s specific agreement, the arbitrator ordered TVA to establish 40 hourly positions in the heavy equipment division, and pay backpay to the 40 individuals.” This argument was never so much as mentioned in the district court’s opinion.
TVA could undoubtedly have done a better job than it did in presenting its argument to the arbitrator in the first instance. I am not persuaded, however, that TVA waived its right to make the argument before the courts.2
The issue raised by TVA is a serious one, and it ought to have been addressed by the district court. It ought to have been addressed by the arbitrator as well. Because it was not, I am reluctant simply to affirm the decision in which the district court confirmed and enforced the arbitrator’s award. The preferable course, it seems to me, would be to remand the case to the district court with instructions to return it to the arbitrator for reconsideration in light of the circumstances to which I have referred.

. The majority opinion suggests that the agreement to eliminate the hourly bargaining unit was not reached until April of 1992, when TVA entered into a "Framework Agreement” with the new TVTLC. As the IAM brief notes, however, it was the "Original Council” that agreed to eliminate the hourly bargaining unit contract. This agreement could not have been reached after May of 1991 if, as stated in note 1 of the majority opinion, the original council dissolved on May 9, 1991.

. In a letter brief submitted to the arbitrator under date of April 27, 1993 — more than two months before the second supplemental award was issued — TVA told the arbitrator, among other things, that:
"With the full knowledge and acceptance by the Council, TVA decided to contract out all hourly trades and labor work instead of just some of it as had been the previous practice. In May 1991, TVA decided to cease using hourly trades and labor employees for any trades and labor work and to instead contract out .that work. The enclosed articles and news releases describe that decision and the union acceptance of these arrangements.
"While the Council recognized TVA’s right to contract out that very work, TVA demonstrated good faith by negotiating at that same time two project labor agreements with the Council, which cover and are signed by contractors who are awarded contracts for trades and labor work which was formerly performed by hourly TVA trades and labor employees. Indeed, the presidents of the signatory unions, which comprise the Council, including the international president of the IAM, signed these Project Agreements.
"Since TVA no longer employs hourly employees of any craft and therefore there are no hourly craft bargaining units in TVA, there is no existing General Agreement for hourly employees.”