Court Opinion

ID: 9446949
Source: CourtListenerOpinion
Date Created: 2023-08-03 22:22:14.285031+00
Date Added: 2024-06-11T17:30:50.945948
License: Public Domain

RIVES, Circuit Judge
(dissenting).
Originally of like view with my brothers and the learned district judge, further study and reflection have brought me to the certain conclusion that this judgment should be reversed.
The union’s grievance as stated by a group of laboring men need not meet the technically precise requirements of strict pleadings. As quoted in the majority opinion, it clearly states: first, that the employer has engaged in the practice of subcontracting to such an extent that, under the conditions currently prevailing, the practice amounts to a partial lockout in violation of the express terms of the collective bargaining contract; and, secondly, that the employer has engaged in this practice for the purpose of discriminating against members of the union, again in violation of the express terms of the contract.1
In order to determine the arbitrability of this grievance, reference must be made to Section 10 of the contract, which provides, in pertinent part, as follows:
“Adjustment of Grievances
“Issues which conflict with any Federal statute in its application as *638established by Court procedure or matters which are strictly a function of management shall not be subject to arbitration under this section.
“Should differences arise between the Company and the Union or its members employed by the Company as to the meaning and application of the provisions of this Agreement, or should any local trouble of any kind arise, there shall be no suspension of work on account of such differences, but an earnest effort shall be made to settle such differences immediately in the following manner * *
Section 10 then proceeds to outline a five-step grievance procedure culminating in arbitration by an impartial umpire selected by the parties.
The decision in this case ultimately turns upon the interpretation given to the above-quoted provisions of Section 10. The employer, on the one hand, contends: that the first paragraph of Section 10 creates an overriding exclusion from the general arbitration provisions that follow; that this exclusion is for judicial cognizance rather than merely a direction of the arbitrator; and that the matter of subcontracting falls entirely within this exclusion in that it is “strictly a function of management.” "The union, on the other hand, joins issue •on each of these points, contending: first, that no overriding exclusion from the general arbitration provisions is created; secondly, that, even if such an exclusion were created, the context renders it clear that the exclusion is no more than a direction to the arbitrator; and, ■finally, that, in any case, the matter of ■subcontracting without any restrictions is not “strictly a function of management,” but, rather, is limited by other provisions of the agreement. I agree with the contention of the union on this third point, and hence do not reach the first two.2
Insofar as the union’s grievance is premised upon the theory of a partial lockout, the controlling section of the agreement, in my view, is Section 3, which provides:
“Illegal Suspension of Work
“A strike or stoppage of work on the part of the employees represented by the parties signatory hereto shall be a violation of this Agreement, and there shall be no strikes, work stoppages, interruptions, or impeding of work. Likewise, a lockout on the part of the Company shall also be a violation of this Agreement.”
This blanket prohibition of strikes and lockouts is nowhere qualified in the Agreement. On the contrary, the entire tenor of the Agreement is that the parties are seeking complete stability. By Section 3 the employer has unreservedly relinquished any managerial prerogative it might have had to resort to a lockout and, at the same time, it has subordinated any retained management functions to the overriding qualification that they not be exercised to effect a lockout. Any other construction would render nugatory the express provisions of Section 3.3
It therefore seems clear that, if the charges contained in the union’s grievance of August 22 are true, the actions of the employer in subcontracting work are in violation of Section 3 of the contract. The essential question then is whether the contract contemplates the determination of these charges by arbitration. When attention is directed to the nature of the issues raised by the charges, it is clear that this question must be answered affirmatively.
*639In the first place, the contract provides for the arbitration of “differences * * as to the meaning and application of the provisions of this Agreement.” Clearly, such differences are involved here. The dispute turns upon the meaning and application of the term “lock-out” as it appears in Section 3. Moreover, the contract provides for the arbitration of “any local trouble of any kind.” A dispute as to the existence of a partial lockout would seem to be equally well covered by this provision.4
The decision of the district court below was premised upon acceptance of the employer’s contention that subcontracting is “strictly a function of management” under the terms of the contract, and, therefore, disputes in reference thereto are expressly excluded from the scope of the arbitration provisions by the first paragraph of Section 10 of the Agreement.
Such a premise does not, however, withstand close examination. The management functions clause itself in the contract certainly does not sustain it. That clause provides only that
“[t]he management of the Company and the direction of the working forces, including the right to hire, suspend or discharge for proper cause, or transfer, and the right to relieve employees from duty because of lack of work, or for other legitimate reasons, is vested exclusively in the Company, provided that this will not be used for purposes of discrimination against any member of the Union.”
The employer has sought to avoid the implications of the absence of any express provision for the retention of the matter of subcontracting as a management function by reliance upon evidence which it contends establishes a practical construction of the contract to that effect, and which is summarized in the district court’s findings of fact numbered 8 and 9, quoted in the majority opinion. Though those findings are amply supported by the evidence in the record, they are of no avail to the employer here. This is so because they fall entirely short of justifying the conclusion that unrestricted subcontracting in violation of other provisions of the collective bargaining agreement cannot give rise to an. arbitrable grievance.
At the very most, these findings establish only that subcontracting is not, in itself, a violation of the contract and that the practice of subcontracting as it was engaged in by the employer during the earlier years of the relationship between the parties did not involve a breach of any other provisions of the contract. Quite obviously, these propositions do not dispose of the issues of this case. Since the allegation of a partial lockout is based upon currently prevailing conditions, the history of the relationship between the parties is in no way inconsistent with the union’s present contention.5 To borrow the words of a well-known labor arbitrator — “The * * * issue * * * is not whether the Company may contract out all of its work or none of its work. It is whether there was any implied contractual bar to the contracting out of this particular * * * work: *640* * * under the circumstances of this particular case.” 6
Insofar as the union’s grievance is premised upon the theory that the employer has utilized the practice of subcontracting to discriminate against the members of the union, the case is even stronger. Section 11 of the contract expressly subordinates all management functions to the overriding limitation that they “not be used for purposes of discrimination against any members of the Union.” Thus, “matters which are strictly a function of management,” as that term is used in Section 10 of the contract, can never be interpreted to include disputes involving allegations of discrimination. To do so would involve ignoring express limitations in the management functions clause itself.7
In its Findings of Fact, the district court concluded that:
“7. The defendant has contracted out such repair, maintenance and construction work solely for reasons of economy and efficiency.
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“13. There has been no showing by the plaintiff that the defendant has engaged, in or, insofar, as these proceedings are concerned, could be adjudged to have engaged in any conduct which has violated any of the provisions of the present labor contract.” 168 F.Supp. 702, 704, 705.
Without expressing any opinion as to the correctness of these findings, they are without effect upon the course of this litigation. They involve a determination of the merits of the union’s grievance, and, consequently, constitute an invasion of the province of the arbitrator as defined in the contract between the parties.8
I think that the judgment should be reversed, and therefore respectfully dissent.

. With, respect to the questions raised concerning the first paragraph of Section 10, appellant’s observation that “this can hardly be said to be a model of contractual draftsmanship” seems well taken.

. It cannot be said of the present arbitration danse as was said in Refinery Employees Union of the Lake Charles Area v. Continental Oil Co., 5 Cir., 268 F.2d 447: “The arbitration dause in the case at bar is not a broad grant of authority to the arbitrators, a quid pro quo for giving up the right to strike.”

. See Timken Roller Bearing Co. v. N. L. R. B., 6 Cir., 1947, 161 F.2d 949, wlierein the Court of Appeals for the Sixth Circuit took a similar view of an identical arbitration provision.

. To hold otherwise would be to completely ignore the difference between a contract which limited or absolutely prohibited subcontracting and one which merely subordinated the employer’s right to subcontract to the more general obligations imposed upon him by the collective bargaining contract, suck as the obligation not to lockout and the obligation not to discriminate. The union’s attempt to obtain a contract which would’ fall into the first of these categories certainly does not constitute an admission that the existing contract did not already fall into the second. Insofar as-Finding of Fact No. 11 of the district court (168 F.Supp. 702, 705) is at variance with these views, it is incorrect.

. Ralph T. Seward, Bethlehem Steel Co., 30 LA 678. (Emphasis in original.)

. The interpretation given here to the term “strictly a function of management” cannot be objected to on the ground that it completely destroys the meaning of that clause. On the contrary, the clause is not without meaning, for it operates to preclude from arbitration any dispute as to the propriety of the exercise of a management function which does not involve a violation of other substantive provisions of the contract. Eor example, the employer need not arbitrate a dispute concerning his power to discharge for proper cause. If, on the other hand, the dispute involves an allegation that no proper cause for the discharge existed, or that the discharge was motivated by discriminatory purposes, the contract requires reference of the dispute to arbitration.
Similarly, the employer is under no obligation to arbitrate a dispute concerning his power to subcontract. But where, as here, the allegation is that this power has been utilized to violate other provisions of the contract, the duty to arbitrate arises.
Thus, the term “strictly a function of management” is interpreted to mean a function of management, the exercise of which does not involve a violation of any of the other provisions of the contract. Indeed, it is difficult to see how the word “strictly” could have any other meaning.

. We are not here confronted with the necessity of determining whether this Court will adopt the so-called Cutler-Hammer doctrine. See International Association of Machinists, Dist. No. 15, Local No. 402 v. Cutler-Hammer, Inc., 271 App.Div. 917, 67 N.Y.S.2d 317 (Sup.Ct., 1947, affirmed without opinion, 1947, 297 N.Y. 519, 74 N.E.2d 464. Under this doctrine, some courts have refused to order arbitration of a dispute otherwise clearly arbitrable on the ground that the plaintiff’s grievance was so clearly without merit that no substantial question for arbitration was raised. See, e. g., United Steelworkers of America v. America Manufacturing Co., 6 Cir., 1959, 264 F.2d 624. But see Judge Magruder’s opinion in New Bedford Defense Products Division of Firestone Tire & Rubber Co. v. Local 1113, U.A.W., 1 Cir., 1958, 258 F.2d 522, 526-27. Without taking any view on the merits of this doctrine, I would hold that the grievance here sought to be arbitrated is not so lacking in substance as to fall within its ambit. The dispute is therefore arbitrable under the principles enunciated by this Court in Lodge No. 12, Dist. No. 37, International Ass’n of Machinists v. Cameron Iron Works, Inc., 1958, 257 F.2d 467, 471.