Court Opinion

ID: 2998120
Source: CourtListenerOpinion
Date Created: 2015-09-24 19:41:09.633827+00
Date Added: 2024-06-11T11:45:35.512345
License: Public Domain

In the
 United States Court of Appeals
               For the Seventh Circuit
                         ____________

No. 04-4206
DEXTER AXLE COMPANY,
                                             Plaintiff-Appellant,
                                v.

INTERNATIONAL ASSOCIATION OF
MACHINISTS & AEROSPACE WORKERS,
DISTRICT 90, LODGE 1315,
                                             Defendant-Appellee.
                         ____________
            Appeal from the United States District Court
     for the Northern District of Indiana, South Bend Division.
                No. 03 C 906—Allen Sharp, Judge.
                         ____________
     ARGUED JUNE 3, 2005—DECIDED AUGUST 15, 2005
                     ____________

 Before CUDAHY, POSNER, and WILLIAMS, Circuit Judges.
  CUDAHY, Circuit Judge. This action to vacate an arbi-
tration award was brought by the Dexter Axle Company
(Dexter), against the International Association of
Machinists and Aerospace Workers, District 90, Lodge 1315
(Union) under the Labor and Management Relations Act of
1947, 29 U.S.C. § 185. A collective bargaining agreement
(CBA) between Dexter and the Union provided that Dexter’s
employees would receive incentive pay for completing as-
sembly tasks more quickly than at a benchmark production
2                                              No. 04-4206

rate called a “standard”. The CBA also allowed Dexter to
periodically recalculate incentive standards in the event
there was a significant change in method, tooling or other
conditions and set forth procedures for challenging these
recalculations. Dexter having recalculated inventive stand-
ards in 2000 and having implemented new standards in
2001, certain union members contested the standard for the
12-inch axle station. After exhausting internal procedures,
the dispute was submitted to arbitration, with the arbitra-
tor finding the contested standard improper and awarding
lost wages to affected employees. Dexter then challenged
the award in district court and, the parties having filed
cross-motions for summary judgment, the district court
granted summary judgment for the Union. On appeal,
Dexter now asserts that the arbitrator exceeded his author-
ity in awarding lost wages and that compliance with the
award would result in Dexter’s violation of the CBA. We
affirm.

                             I.
  Dexter is a manufacturer of trailer axles, and the Union
is the authorized bargaining representative for all produc-
tion and maintenance workers at Dexter’s Elkhart, Indiana
manufacturing facility (Elkhart). Dexter and the Union
were parties to a CBA, whose term ran from July 23, 1999
to July 22, 2002. The CBA consists of sixteen articles, with
Article XV providing for a basic hourly rate and outlining
an incentive pay system for Elkhart employees. The terms
of the incentive pay system are set forth in the sixteen
sections of the Incentive Pay System Supplement (Supple-
ment), which, inter alia, establish procedures for setting
and challenging incentive standards. The Supplement is a
separate document from the sixteen articles of the CBA, but
is made part of the CBA by the express language of Article
XV.
No. 04-4206                                                 3

  In Article VII, “Grievance Procedures,” and Article VIII,
“Arbitration,” the CBA also establishes procedures for re-
solving disputes about its provisions. The Supplement out-
lines in Sections 10, 11 and 12 additional procedures for
employees to contest incentive standards. Sections 11 and
12 of the Supplement specifically refer to Articles VII and
VIII of the CBA, respectively, with Section 12, stating in its
entirety:
    Section 12. If no agreement is reached at Step Three,
    the disputed standard may be submitted to arbitration
    under the provisions of Article VIII, except that the
    Arbitrator selected shall be a competent engineer in the
    field of work measurement or one who is experienced in
    arbitrating incentive grievances. The Arbitrator shall
    have no power to set a standard and/or rate, or to
    establish methods or procedures. His authority shall be
    limited to reviewing whether the standard is proper and
    consistent with those established in the plant and has
    been properly applied.
  In November of 1999, Dexter assigned an industrial
engineer (Engineer) to study and establish new incentive
standards for Elkhart’s axle assembly processes. The
Supplement provides details about how the Engineer is
expected to set standards on which to calculate incentive
pay. The Engineer concluded his study in January of 2000,
and Dexter implemented the Engineer’s newly established
standards in September of 2001. In November of 2001,
several Elkhart employees filed complaints with Dexter
protesting the newly calculated rates in accordance with the
procedures outlined in the Supplement. The Union and
Dexter could not resolve the matter; so it was submitted to
arbitration. The arbitrator issued an Interim Award in June
of 2003, and, before he issued his Final Award in Septem-
ber, permitted the Engineer to respond to the Interim
Award. After reviewing the Engineer’s response, the
arbitrator concluded in his Final Award that the line
4                                               No. 04-4206

balancing method used by the Engineer on the 12-inch axle
line resulted in an improper standard. The arbitrator
expressly defined the limits of his authority in making this
Final Award as stemming from Article VIII of the CBA and
section 12 of the Supplement. The arbitrator then awarded
affected employees lost wages resulting from the implemen-
tation of the new, improper standard.
  Thereafter, pursuant to the Labor and Management
Relations Act of 1947, 29 U.S.C. § 185, Dexter filed a com-
plaint in December of 2003 against the Union and moved to
vacate the arbitrator’s award. After the parties filed cross-
motions for summary judgment, the district court granted
the Union’s motion in November of 2004. In its Memoran-
dum and Order, the district court acknowledged that Dexter
had made a “clever technical” argument to undermine the
award, but stated that this was not enough under a collec-
tive bargaining agreement to disturb an arbitrator’s award,
citing United Steelworkers of America v. Enterprise Wheel
and Car Corp., 363 U.S. 593 (1960). Dexter then initiated
this appeal in December of 2004.

                             II.
  A district court’s grant of summary judgment is reviewed
de novo, applying the same standards as did the district
court to evaluate the arbitrator’s decision. N. Ind. Pub.
Serv. Co. v. United Steel Workers of Am., Local Union 2775,
243 F.3d 345, 346 (7th Cir. 2001). Judicial review of
arbitration awards under collective bargaining agreements
is extremely limited. Id.
  Dexter presents two arguments to support its contention
that the arbitrator’s award should be vacated. Dexter first
alleges that the arbitrator exceeded his authority by award-
ing lost wages. Second, Dexter argues that compliance with
the arbitrator’s award would force Dexter to violate the
CBA. We address each of these arguments in turn.
No. 04-4206                                                        5

A. Whether the Arbitrator Exceeded His Authority Under
   the CBA By Awarding Lost Wages
  Dexter asserts that the arbitrator had no authority to
award lost wages since this remedy is not available in the
arbitration of an incentive rate dispute. Thus, the argument
is that the arbitrator disregarded the plain language of
Section 12 of the Supplement, which limits the arbitrator’s
authority to “reviewing whether the standard is proper and
consistent,” without elaboration, and makes no mention of
lost wages. Dexter cites numerous cases holding that arbi-
trators are without authority to disregard the plain lan-
guage of a contract. See Polk Bros., Inc. v. Chi. Truck
Drivers, Helpers, & Warehouse Workers Union, 973 F.2d
593, 597-98 (7th Cir. 1992); District No. 72 & Local Lodge
1127, Int’l Assoc. of Machinists & Aerospace Workers v.
Teter Tool & Die, Inc., 630 F. Supp. 732, 735 (N.D. Ind.
1986); Durabond Products, Inc. v. United Steelworkers of
Am., 421 F. Supp. 76, 79 (N.D. Ill. 1976)
  Dexter also relies on Indiana common law and the prin-
ciple of expressio unius est exclusio alterius to demonstrate
that the parties intended that incentive pay arbitrations
contemplate no lost wages remedy.1 Indiana common

1
   In a footnote to its appellate brief, the Union notes that Dexter
relied on Indiana contract law to interpret the CBA and states
that, under John Wiley & Sons, Inc. v. Livingston, 376 U.S. 543
(1964), the construction of collective bargaining agreements
subject to 29 U.S.C. § 185 is a matter of federal common law. In
reply, Dexter asserts that courts commonly use contract interpre-
tation tools when construing collective bargaining agreements. See
id., R.L. Coolsaet Constr. Co. v. Local 150, Int’l Union of Operating
Eng’rs, 177 F.3d 648 (7th Cir. 1999) Under John Wiley & Sons
“[f]ederal law, fashioned from the policy of our national labor laws,
controls” suits brought pursuant to § 301 of the Labor Manage-
ment Relations Act, 29 U.S.C. § 185. 376 U.S. at 548 (citing
                                                     (continued...)
6                                                     No. 04-4206

law provides that when a contract contains general and
specific provisions relating to the same subject, the specific
provision controls. See Bowling v. Poole, 756 N.E.2d 983,
990 (Ind. Ct. App. 2001); Eskew v. Cronett, 744 N.E.2d 954,
957 (Ind. Ct. App. 2001). Thus, Dexter contends that the
dispute resolution procedures contained in CBA Articles VII
(Grievance Procedure) and VIII (Arbitration) are super-
seded by the Supplement. Under Indiana law, the Supple-
ment, which is specifically applicable to the incentive
program, controls over the general provisions of the CBA.

(...continued)
Textile Workers Union of Am. v. Lincoln Mills of Ala., 353 U.S.
448, 456-57 (1957)). In contrast, “[s]tate law may be utilized so far
as it is of aid in the development of correct principles or their
application in a particular case, but the law which ultimately
results is federal.” Id. at 548 (internal citation omitted). We have
followed this course, having held that “while the arbitrability of a
dispute is ordinarily regulated by state law, collective bargaining
agreements are interpreted under federal law ” though “we may
draw guidance from state law principles if they are compatible
with federal labor law policies.” Int’l Brotherhood of Electrical
Workers, Local 176 v. Balmoral Racing Club, Inc., 293 F.3d 402,
405 (7th Cir. 2002); see also Merk v. Jewel Food Stores Div. of
Jewel Cos., Inc., 945 F.2d 889, 892 (7th Cir. 1991) (“Ordinary com-
mon law contract principles, therefore, cannot simply be imported
whole into the labor context and mechanistically applied to
collective bargaining agreements. To foster industrial peace and
stability, we must instead read collective bargaining agreements
with sensitivity to considerations of national labor policy.”);
WILLISTON ON CONTRACTS § 55:15 (Richard A. Lord ed., 4th ed.
2004) (“[T]he rule that a labor collective bargaining contract is to
be construed according to federal rather than state law does not
make state law principles completely inapplicable, since the role
of a court in interpreting a contract is to ascertain what the
parties meant by the words they used; thus, traditional rules of
contract interpretation apply when they are not inconsistent with
federal labor law.”).
No. 04-4206                                                     7

Dexter also argues that, under the maxim expressio unius
est exclusio alterius (expressly including some matters in a
contract implies the exclusion of others), see R.L. Coolsaet
Construction Co. v. Local 150, International Union of
Operating Engineers, 177 F.3d 648, 658 (7th Cir. 1999),
Section 12 of the Supplement expressly references CBA
Article VIII (arbitration) detailing the submission of an
incentive rate dispute, but does not expressly refer to its
remedies, including lost wages, indicating that the parties
did not intend Article VIII remedies to be available. Dexter
further argues that the parties knew how to provide for
remedies (such as lost wages) since CBA Article VIII spe-
cifically addresses remedies, and that the omission of such
remedies from Section 12 of the Supplement evidences a
deliberate decision to omit authority for awarding lost
wages.
  The Union, on the other hand, insists that lost wages are
available as a remedy. The Union contends that, since § 7.5
of CBA Article VII2 is incorporated by reference in Section
11 of the Supplement,3 the parties specifically agreed that
disputes over incentive rate standards contemplate remu-
neration as a possible remedy. The Union then asserts that
Dexter’s interpretation of the last two sentences in Section
12 (construed as limiting the arbitrator’s authority) is an
“unnatural reading” since it assumes that the second
sentence constitutes a wholesale limitation on the arbitra-

2
  Section 7.5 of CBA Article VII, titled “Grievance Procedure,”
anticipates monetary awards, such as back pay relief, stating that
“[w]here remuneration is involved, such remuneration shall be
effective as decided in the grievance procedure.”
3
  Section 11 of the Supplement provides that an unresolved
dispute concerning a standard will proceed “as a grievance at Step
Two of the Grievance Procedure of Article VII” and then states
that “[s]ettlement of any grievance shall be in accordance with
Section 7.5 . . . .”.
8                                                    No. 04-4206

tor’s activities with respect to incentive rate standards. In
contrast, the Union suggests that the second sentence
(stating that “[the arbitrator’s] authority shall be limited to
reviewing whether the standard is proper and
consistent . . . .”) merely modifies the prior sentence (stating
that “the [a]rbitrator shall have no power to set a stand-
ard . . . or to establish methods or procedures.”). According
to the Union, this also explains why Section 11 of the
Supplement states that “[s]ettlement of any grievance shall
be in accordance with” § 7.5 of CBA Article VII. This
argument prompts Dexter to respond that the Union had to
rewrite the last two sentences of Section 12 to support its
argument, and again assert that Section 12 excludes a lost
wage remedy. At this point, the Union concludes that, in
making his Final Award, the arbitrator confined himself to
construing the CBA, see, e.g., Ethyl Corp. v. Local 7441,
United Steel Workers of Am., 768 F.2d 180, 184 (7th Cir.
1985) (arbitrator’s award based on his or her interpretation
of the contract draws its essence from the contract). In any
event, the Union asserts, § 8.2 of CBA Article VIII4 is broad

4
  Section 8.2 of CBA Article VIII, titled “Authority of the Arbitra-
tor,” states in pertinent part:
    The Arbitrator may consider and decide only the particular
    grievance presented to him in the written stipulation of the
    Company and the Union, and his decision shall be based
    solely upon his interpretation of the provisions of this
    Agreement. The Arbitrator shall not have the right to amend,
    modify, remove, add to or disregard any of the provisions of
    this agreement, nor shall he have the power to establish or
    change any basic wage rate or rate range; nor shall he have
    the power to change any discipline imposed by the Company
    unless, upon the facts of the case presented before him, he
    finds the Company has violated the terms of this Agreement.
      In cases of grievance involving the loss of time or money,
    the Parties may agree to, or the Arbitrator may order,
                                                    (continued...)
No. 04-4206                                                        9

enough to authorize the arbitrator to award lost wages. See
Sullivan v. Lemmoncello, 36 F.3d 676, 683 (7th Cir. 1994)
(upholding arbitration board’s assessment of fines and
penalties as drawing its essence from the collective bargain-
ing agreement); Ind. Employee’s Union of Hillshire Farm
Co., Inc. v. Hillshire Farm Co., Inc., 826 F.2d 530, 533-34
(7th Cir. 1987) (upholding arbitrator’s award because it was
“plausible to suppose that the remedy . . . was within the
contemplation of the parties and hence implicitly authorized
by the agreement”). Finally, the Union argues that without
the remedy of lost wages grievances about standards would
be exercises in futility.
  It seems clear to us that Dexter cannot shoulder the
heavy burden involved in setting aside the arbitrator’s
Final Award. Controlling precedent both from the Supreme
Court and from this circuit establishes the criteria under
which we review an arbitrator’s ruling. The Supreme Court
has adopted the classic formulation that an arbitrator’s
award is legitimate “so long as it draws its essence from the
collective bargaining agreement.” United Steel Workers of
Am. v. Enterprise Wheel & Car Corp., 363 U.S. 593, 597
(1960). A court will vacate an award only “when the arbitra-
tor’s words manifest an infidelity to this obligation.” Id.
This circuit has termed the Enterprise Wheel rule a test of
“whether the arbitrator had exceeded the powers delegated
to him by the parties.” Ethyl Corp., 768 F.2d at 184; see also
N. Ind. Public Serv. Co., 243 F.3d at 347 (courts “are
empowered to vacate an award only if the arbitrator
exceeded his or her authority”).
  It is abundantly clear that it is the arbitrator who is
behind the driver’s wheel of interpretation, not the court.

4
    (...continued)
       reinstatement and/or back pay but in no event shall back pay
       be awarded for any period of time prior to the date the griev-
       ance was verbally submitted to the Grievance Procedure.
10                                                No. 04-4206

Great deference is paid to an arbitrator’s construction and
interpretation of an agreement. It is elementary that the
“question of interpretation of the collective bargaining
agreement is a question for the arbitrator.” Enterprise
Wheel, 363 U.S. at 599. “It is the arbitrator’s construction
which was bargained for . . . [and] the courts have no
business overruling him because their interpretation of the
contract is different . . . . ” Id. “[I]t is only when the arbi-
trator must have based his award on some body of thought,
or feeling, or policy, or law that is outside the contract (and
not incorporated in it by reference) that the award can be
said not to draw its essence from the [CBA].” N. Ind. Pub.
Serv. Co., 243 F.3d at 347 (internal quotation omitted).
“Thus, we will vacate only if there is no possible interpre-
tive route to the award.” Id. Significantly, “[w]e resolve any
reasonable doubt about whether an award draws its essence
from the [CBA] in favor of enforcing the award.” Id.
  Here, the arbitrator developed his own interpretation of
the CBA. In his Final Award, the arbitrator stated, “The
provisions of Section 12 of the Incentive Pay System
Supplement and Section 8.2 of the Agreement limit my
authority.” (emphasis added). Because this construction is
the arbitrator’s own, it must be an acceptable construction
under Enterprise Wheel. Further, following Enterprise
Wheel, both Dexter and the Union have bargained for the
arbitrator’s interpretation, and section 8.2 of Article VIII
explicitly allows the arbitrator to award back pay. Because
the arbitrator ruled that section 12 of the Supplement and
§ 8.2 of CBA Article VIII limited his authority, he acted
within the scope of his authority in awarding lost wages.
  In addition, Enterprise Wheel emphasizes another point
crucial to the resolution of this dispute: an arbitrator needs
No. 04-4206                                                     11

flexibility when formulating remedies.5 Id. at 597; see also
Local 879, Allied Indus. Workers of Am. v. Chrysler Marine
Corp., 819 F.2d 786, 789 (7th Cir. 1987) (quoting Enterprise
Wheel). A court “must consider whether it is at all plausible
to suppose that the remedy [the arbitrator] devised was
within the contemplation of the parties and hence implicitly
authorized by the agreement.” Chrysler Marine Corp., 819
F.2d at 789 (quoting Miller Brewing Co. v. Brewery Workers
Local Union No. 9, 739 F.2d 1159, 1163 (7th Cir. 1984)).
The arbitrator’s authority to interpret and find a breach of
the agreement implies the authority to prescribe a remedy
to cure the breach.6 Id. at 789-90. Dexter does not dispute
the merits of the arbitrator’s award; it makes no argument
that the incentive standards on the 12-inch axle line were
correct or that the arbitrator wrongly determined them to be

5
    As the Supreme Court has noted,
      When an arbitrator is commissioned to interpret and apply
      the collective bargaining agreement, he is to bring his in-
      formed judgment to bear in order to reach a fair solution of a
      problem. This is especially true when it comes to formulating
      remedies. There the need is for flexibility in meeting a wide
      variety of situations. The draftsmen may never have thought
      of what specific remedy should be awarded to meet a particu-
      lar contingency.
Enterprise Wheel, 363 U.S. at 597.
6
    The language of Chrysler Marine is as follows:
      Expressly conferring on the arbitrator, as the agreement
      does, the authority to decide the meaning and application of
      the agreement, necessarily implies the authority to find that
      there has been a breach of the agreement as interpreted, and,
      we think, further implies the authority to prescribe a remedy
      which can be said reasonably to cure the breach. Thus the
      award was within the range of remedial authority which can
      reasonably be said to be implied by the contract.
    819 F.2d at 789-90.
12                                                     No. 04-4206

incorrect. Instead, it argues that the arbitrator exceeded his
authority in formulating the remedy. Following Chrysler
Marine, we must consider whether the remedy was within
the contemplation of the parties. The Union asserts that the
reference in Section 11 of the Supplement to § 7.5 of CBA
Article VII shows that the parties agreed that grievances
challenging incentive standards could properly propose
remuneration as an available remedy. Dexter, on the other
hand, argues that Section 11 denies an arbitrator use of
remedial powers (even though presumably the grievance in
arbitration had properly demanded a remedy). However, it
seems to us contrary to the intent of the parties to allow
remuneration to be considered as a remedy at the outset of
the grievance process of an incentive rate dispute but not
during the ultimate arbitration. The present dispute arose
because the parties did not explicitly outline exactly which
remedies would be available to an arbitrator in resolving an
incentive dispute. If the parties had specifically negotiated
this issue, the Union would likely have insisted on remu-
neration as one possible arbitral remedy, and Dexter would
have agreed since there was express agreement that
remuneration might be raised at the outset of the grievance
process.7 It would make no sense for the arbitrator to be

7
   This reasoning satisfies a requirement in the standard for
judicial review of arbitrators’ awards. The standard as stated in
Northern Indiana Public Service Company provides an illustra-
tion. “[A]s long as the arbitrator engaged in bone fide contractural
interpretation, we are without power to vacate even if we believe
the award was factually or legally incorrect.” 243 F.3d at 347. See
also Amax Coal Co. v. United Mine Workers of Am., Int’l Union, 92
F.3d 571, 576 (7th Cir. 1996) (“[I]f there is no possible interpretive
route to the arbitrator’s award, we will refuse to enforce that
award.”). Because determining the parties’ intent is the essence
of contractual interpretation, the fact that the arbitrator’s award
most likely reflects the intent of the parties had they specifically
                                                        (continued...)
No. 04-4206                                                     13

helpless to provide redress for the company’s breach.
Chrysler Marine, 819 F.2d at 790. Because Dexter’s sug-
gested construction provides no remedy for an the imposi-
tion of an improper standard, it is incorrect under Chrysler
Marine and an erroneous interpretation of the CBA.
  In sum, Dexter does not offer a valid argument for
overturning the arbitrator’s award. It fails to demonstrate
that the arbitrator based his award on anything outside the
contract. Indeed, the arbitrator based his award on § 8.2 of
CBA Article VIII and Section 12 of the Supplement— both
of which are part of the fully integrated CBA according to
the plain language of Article XV. Hence, this award was not
based “on some body of thought, or feeling, or policy, or law
that is outside the contract.” Thus, the arbitrator’s award
must stand even if it is the wrong interpretation of the
CBA; “so long as the award is based on the arbitrator’s
interpretation—unsound though it may be—of the contract,
it draws its essence from the contract.” Ethyl Corp., 768
F.2d at 184.

B. Whether Compliance With the Arbitrator’s Award
   Forces Dexter to Violate the CBA
  Dexter’s second argument for rejecting the arbitrator’s
award is somewhat convoluted. It contends that the parties
established a relationship between an employee’s base wage

7
  (...continued)
negotiated remuneration satisfies this requirement. “It is the
function of the courts to seek the proper interpretation of a
contract which reflects the intentions of the parties.” Lenard v.
Argento, 699 F.2d 874, 900 (7th Cir. 1983); see also WILLISTON ON
CONTRACTS § 30:2 (Richard A. Lord ed., 4th ed. 2004) (“In the
interpretation, and ultimately, in the construction of contracts as
well, the avowed purpose and primary function of the court is to
ascertain the intention of the parties.”).
14                                                    No. 04-4206

rate and his incentive pay (which together comprise his
total compensation), requiring that incentive rates be
consistent throughout the plant or else “skilled workers
in one area could be paid less than unskilled workers in
another.” Dexter argues that this is why the Supplement
requires the standards to be consistent throughout the facil-
ity, and that it was with these considerations in mind that
the Engineer used the same methodology to set standards
throughout the plant. The arbitrator allegedly disturbed
this uniformity by determining that, of all the standards
established by the Engineer, only one—the standard for the
12-inch axle—was improper. Thus, according to Dexter, the
practical impact of the arbitrator’s Final Award is that
Dexter must use a unique methodology to calculate the 12-
inch axle incentive rate8—one inconsistent with that used
to establish the other incentive rates in the plant. There-
fore, Dexter argues, the arbitrator’s award conflicts with the
express terms of the CBA and should be vacated. See
Sunbeam Appliance Co. v. Int’l Ass’n of Machinists, 511 F.
Supp. 505, 508 (N.D. Ill. 1981) (vacating arbitrator’s award
that was in conflict with the express terms of the collective
bargaining agreement). The Union asserts in response that
the arbitrator did not require Dexter to do anything, since
he found only that the line balancing method for the 12-inch
axles was improper.

8
   To support this assertion, Dexter cites to the affidavit of Adam
Dexter, Director of Operations at Elkhart, submitted with its
Motion for Summary Judgment. The Union filed a Motion to
Strike the Affidavit. In its Memorandum and Order, the district
court left the affidavit in the record “in the interest of caution.”
The district court, however, noted that it had “serious reserva-
tions about the propriety of the affidavit.” The Union, in its brief,
re-initiates its argument that the affidavit is inadmissible. This
dispute, however, is moot, since the only argument Dexter ad-
vances that relies on the affidavit lacks merit.
No. 04-4206                                                15

   Dexter’s argument is unpersuasive for several reasons.
First, the Supplement does not contain any express lan-
guage requiring that standards be “consistent.” The only
reference to consistency is in Section 12 of the Supplement,
which states that the arbitrator’s authority “shall be limited
to reviewing whether the standard is proper and consistent
with those established in the plant . . . .” Neither the
parties nor the CBA define “consistency” or describe how it
is to be determined. In fact, according to Section 12, only an
arbitrator can determine whether a standard is “con-
sistent”—much like the arbitrator here determining that
the 12-inch axle line standard was improper.
  In addition, as the Union has argued, the arbitrator did
not address any concerns about consistency at all—only the
impropriety of a particular incentive standard. Indeed, in
making his Final Award, the arbitrator stated, “There was
no evidence presented about the relationship of other
standards in the Plant to those standards set here for the
assembly operation”; this suggests that the arbitrator could
not determine whether the disputed 12-inch axle incentive
rate standard was consistent with other standards since he
lacked the evidence to make this determination. And
because the arbitrator was an engineer as required by the
CBA, there is no indication that this failure resulted from
deficiencies in his technical background.
   Third and finally, the dispute procedure outlined in the
CBA renders Dexter’s conclusion premature and speculative
since an employee would first have to challenge a standard
on grounds of inconsistency to trigger the process by which
that standard could be deemed inconsistent. Thus, if Dexter
chooses to recalculate and implement a new 12-inch axle
line standard, it will presumably do so according to the
process outlined in the Supplement. Once this new standard
is implemented, an employee can dispute it according to the
procedure prescribed in Section 10; a dispute that remains
unresolved becomes a second step grievance under Section
16                                                   No. 04-4206

11, and if no agreement is reached after the third step of
the grievance procedure, then Section 12 allows the dispute
to be submitted to arbitration. It is only at this step that the
arbitrator reviews whether the standard is “proper and
consistent.” (Emphasis added). Thus, if no employee dis-
putes the new standard, or if such a dispute is settled prior
to arbitration, consistency will never be an issue.9
  Dexter may believe that inconsistency is a forgone con-
clusion. But the time for it to make that argument was
when the CBA was negotiated, not after an arbitrator has
made an award by following procedures that Dexter itself
agreed to under the CBA. It should have been obvious to
Dexter that giving an arbitrator the authority to determine
whether an incentive standard is improper or inconsistent
might result in a finding that a standard possessed exactly
those qualities; hence it cannot now argue that such a rul-
ing violates the CBA. “The parties have bargained ex ante
for arbitration as an alternative means of dispute resolu-
tion, and ex post they must abide by this bargain.” Chrysler
Marine, 819 F.2d at 788. “If parties to collective bargaining
contracts are unhappy with arbitration awards they can
bargain for a different method of selecting arbitrators, or for
panels of arbitrators, trial or appellate.” Ethyl Corp., 768
F.2d at 187.

                               III.
  For the above reasons, we AFFIRM the district court’s
grant of summary judgment to the Union.

9
   Other outcomes are possible. Since the 12-inch line was the only
line that was contested, there is an implication that this line has
a distinct characteristic. Dexter and the Union could agree to use
a different methodology on that line than on other lines in the
plant.
No. 04-4206                                         17

A true Copy:
      Teste:

                    ________________________________
                    Clerk of the United States Court of
                      Appeals for the Seventh Circuit

               USCA-02-C-0072—8-15-05