Court Opinion

ID: 3153945
Source: CourtListenerOpinion
Date Created: 2015-11-12 14:03:31.413906+00
Date Added: 2024-06-11T11:59:12.980980
License: Public Domain

ATTORNEY FOR APPELLANTS                                   ATTORNEYS FOR APPELLEE
      Jeffrey K. Graham                                         William R. Groth
      Bingham Farber & Wilson P.C.                              David T. Vlink
      Elwood, Indiana                                           Fillenwarth Dennerline Groth &
                                                                Towe, LLP
                                                                Indianapolis, Indiana

                                                  IN THE
          COURT OF APPEALS OF INDIANA

      Madison County Board of                                   November 12, 2015
      Commissioners and Madison                                 Court of Appeals Case No.
      County Highway Department,                                33A05-1505-PL-409
      Appellants-Plaintiffs/Counterclaim                        Appeal from the Henry Circuit
      Defendants,                                               Court
                                                                The Honorable Mary G. Willis,
              v.                                                Judge
                                                                Trial Court Cause No.
      American Federation of State                              33C01-1502-PL-8
      County and Municipal
      Employees Local 3609,
      Appellee-Defendant/Counterclaim                                                   Nov 12 2015, 6:13 am
      Plaintiff

      Crone, Judge.

                                              Case Summary
[1]   Two employees of the Madison County Highway Department (“the

      Department”), who were also members of the American Federation of State

      County and Municipal Employees Local 3609 (“the Union”), loafed on the job

      for two consecutive days and took an excessively long lunch break on the third

      Court of Appeals of Indiana | Opinion 33A05-1505-PL-409 | November 12, 2015            Page 1 of 15
      day. The Union has a collective bargaining agreement (“CBA”) with the

      Madison County Board of Commissioners (“the County”)1 that mandates

      progressive discipline for minor infractions such as those committed by the

      employees. Commission of a third minor infraction results in the employee

      being subject to discharge. By contrast, commission of a single major

      infraction, such as theft, results in the employee being subject to discharge.

[2]   The County did not initiate disciplinary proceedings against the employees until

      the end of the third day. The County initially alleged that the employees

      committed minor infractions and ultimately discharged them for what it

      claimed were major infractions. The matter was submitted to arbitration

      pursuant to the CBA, and the Union represented the employees at the hearing.

      The arbitrator determined that the employees had not committed major

      infractions and, based in part on what he characterized as “procedural and

      substantive due process concerns raised by the County’s failure to promptly

      notify [the employees] of the wrongful nature of their workplace behavior,”

      concluded that the appropriate punishment for the employees’ misconduct was

      a five-day unpaid layoff. Appellants’ App. at 67.

[3]   The County asked the trial court to correct or vacate the arbitrator’s award. In

      response, the Union filed an answer and counterclaim. The Union and the

      1
       Because the Department is an arm of the County, we sometimes refer to these entities interchangeably or
      collectively as “the County” below.

      Court of Appeals of Indiana | Opinion 33A05-1505-PL-409 | November 12, 2015                    Page 2 of 15
      County filed cross-motions for summary judgment. The trial court granted the

      Union’s motion and denied the County’s motion.

[4]   On appeal, the County argues that the arbitrator exceeded his authority under

      the CBA by basing his award on due process concerns and by reducing the

      employees’ punishment. We disagree. The County circumvented the CBA’s

      progressive discipline scheme, and the CBA does not require discharge for the

      infractions committed by the employees or prohibit the arbitrator from reducing

      an employee’s punishment. Therefore, we affirm summary judgment in favor

      of the Union.

                                  Facts and Procedural History
[5]   Scott Amos and Travis Benfield (“the Employees”) were employed as truck

      drivers by the Department. They were also members of the Union and its

      president and vice president, respectively. The Union has a CBA with the

      County, under which the parties “recognize the authority of the County to take

      appropriate disciplinary action for just cause.” Id. at 27. Pursuant to the CBA,

      Department employees may be disciplined for class A minor infractions, class B

      minor infractions, or major infractions of work rules. Among the class B minor

      infractions listed in the CBA are “[u]nauthorized use or removal of County

      vehicles, equipment or tools for other than Department work,” “[s]leeping on

      the job, loafing or spending excessive time at lunch periods,” and “[o]ther

      actions of similar consequences deemed Class B minor infractions by the

      Superintendent.” Id. at 44. “Under extenuating circumstances a Class B

      infraction may be upgraded to a major infraction.” Id. Among the major
      Court of Appeals of Indiana | Opinion 33A05-1505-PL-409 | November 12, 2015   Page 3 of 15
      infractions listed in the CBA are “[t]heft or dishonesty of any kind,” “[u]sing

      County property or equipment for personal matters not required by job duties,”

      “[f]alsification, tampering with, removing, or misusing any County records,

      documents, or reports,” “[l]eaving job during working hours without prior

      authorization,” and “[o]ther actions of similar consequences deemed

      infraction[s] by the Superintendent.” Id. at 45.

[6]   The CBA mandates “progressive discipline” for minor infractions. Id. at 43, 44.

      For class B minor infractions, the first “Offense” results in a written warning,

      the second in a five-day layoff without pay, and the third in the employee being

      “Subject to Discharge.” Id. at 44. By contrast, the commission of a single

      major infraction results in the employee being “subject to discharge.” Id. at 45.

      The CBA states, “If disciplinary action is to take place, it shall be done within

      three (3) working days from [the] time the incident was reported to the

      Superintendent or Designee.” Id. at 27.

[7]   On June 23 through 25 of 2014, the Employees were assigned to the same truck

      to repair potholes and broken pavement on rural roads with a DuraPatch

      machine. On June 23, a county commissioner saw the Employees’ truck and

      the Employees sitting idle on the road near his house. After the truck left, the

      commissioner “found an area approximately two and one-half feet wide by 12

      feet long that had been filled and patched and noticed a similarly-sized area of

      the road still in need of repair.” Id. at 51. The commissioner reported his

      observations to the Department superintendent. On June 24, the commissioner

      again saw the truck and the Employees sitting idle. After they filled a few

      Court of Appeals of Indiana | Opinion 33A05-1505-PL-409 | November 12, 2015   Page 4 of 15
      potholes and departed, the commissioner again reported his observations to the

      Department superintendent. On June 25, the GPS tracking device on the

      Employees’ truck indicated, and a fellow Department employee personally

      observed, that the truck was parked near two restaurants for over an hour.

      Under the CBA, employees are given a “half hour at mid-day, without pay, to

      eat lunch[.]” Id. at 38.

[8]   When the Employees returned the truck to the Department garage on June 25,

      they “were given Disciplinary Notice Written Warnings dated Monday, June

      23, 2014,” which “state[d] as the reason for the discipline ‘On 6/23/14 Minor

      Infraction Class B 5 sleeping on the job (loafing) or spending excessive time at

      lunch periods.’” Id. at 52. On June 26, they were suspended without pay in a

      memorandum from the Department superintendent that reads as follows:

              This is to inform you today your [sic] suspended without pay
              pending an investigation that you have committed violations of
              the [CBA] and Madison County Personnel Policies and Indiana
              employment statutes [sic].

              It was reported that you are not performing assigned work which
              may constitute a violation of the Indiana Ghost-employment
              law. It is [sic] come to my attention via the County Highway
              Department GPS tracking devises [sic] and witness reports that
              you were parked for extended periods of scheduled work time
              and did not perform any work on June 23, June 24, and June 25,
              2014. Based on this information County is investigating this
              matter is [sic] continuing violation of Coast [sic] employment
              statutes.

              Once the investigation is complete you will be notified of the

      Court of Appeals of Indiana | Opinion 33A05-1505-PL-409 | November 12, 2015   Page 5 of 15
              findings and recommendations, and will be afforded the
              opportunity to respond.

      Id. (excerpted from arbitration award; some “[sic]” designations added).

[9]   Pursuant to the CBA, the Employees were given a pre-deprivation hearing on

      July 2. Two weeks later, they were given a memorandum that reads in

      pertinent part as follows:

              Please be advised that based on our findings stemming from an
              investigation of your actions on June 23, 24 and 25, 2014, your
              employment with Madison County is terminated effective
              immediately.

              Based on our findings, you have violated the Ghost Employment
              policy found on page 72-73 of the Madison County Policies
              Hymnbook [sic] (the “Employee Handbook”) by submitting
              timecards which purport to show you working during times that
              is [sic] contradicted by substantial evidence, including but not
              limited to, eyewitness testimony in [sic] GPS tracking data.
              Pursuant to the Employee Handbook, disciplinary action for
              violations of the Ghost Employment policy may include
              termination.

              In addition, based on our findings, you have committed the
              following Major Infractions as defined by the [CBA]:

              • Theft or dishonesty of any kind

              • Using County property or equipment for personal matters not
              required by job duties

              • Falsification, tampering with, removing, or misusing any
              County records, documents, or reports.

      Court of Appeals of Indiana | Opinion 33A05-1505-PL-409 | November 12, 2015   Page 6 of 15
                • Leaving job during working hours without prior authorization.

                Pursuant to the [CBA], employees who commit Major
                Infractions shall be subject to discharge.

                Be further advised that we will be referring this matter to the
                Madison County Prosecutor. In addition, we may seek
                reimbursement of the wages paid to you that were not earned.

       Id. at 53 (excerpted from arbitrator’s award).

[10]   The Employees availed themselves of the CBA’s grievance procedures, and the

       matter was ultimately submitted to arbitration. The CBA states, “The arbitrator

       shall have no authority to add to, change, delete, or otherwise modify any part

       of this agreement. Any decision of the arbitrator shall be final and binding on

       all parties.” Id. at 26. At the arbitration hearing, the Employees were

       represented by the Union. The parties stipulated that the issue before the

       arbitrator was as follows: “Were the discharges of [the Employees] for just

       cause? If not, what is the proper remedy?” Id. at 53.

[11]   In January 2015, the arbitrator issued an award containing extensive factual

       findings. 2 The arbitrator found that the County had failed to prove that the

       Employees had “engaged in misconduct that can be accurately characterized as

       2
        The Union’s brief contains a link to the arbitrator’s online biography. We decline the Union’s invitation to
       consider material that is both irrelevant and outside the record on appeal.

       Court of Appeals of Indiana | Opinion 33A05-1505-PL-409 | November 12, 2015                      Page 7 of 15
ghost employment” as defined in the Employee Handbook. Id. at 63. The

arbitrator further found,

        Like the charge of ghost employment, the four categories of
        Major Infractions misconduct with which [the Employees] are
        charged do not accurately capture the actions the County
        contends they engaged in that warranted their discharges. Thus,
        there is no evidence that [the Employees] used County
        equipment for personal matters not required by their job duties;
        or that they falsified, tampered with, removed or [misused] any
        County records, documents or reports. Furthermore, there is no
        evidence to indicate that the [Employees] left or abandoned their
        jobs during work hours on the three days in question, and there is
        no proof that they actually stole any County property or engaged
        in blatant acts of dishonesty equivalent to stealing County
        property.

        It is true that viewed in the very broadest possible sense, [the
        Employees’] alleged acts of malingering on the job on June 23
        and 24, 2014; as well as the excessively-long lunch period the
        County claims they took on June 25, 2014, could be deemed
        dishonesty or stealing wages that they did not earn while they
        were sitting idle instead of working. Nevertheless, the County
        has not satisfactorily proven that the Major Infractions element
        of the Minor Infractions/Major Infractions disciplinary scheme
        agreed to by the Parties and memorialized in their [CBA] is
        sufficiently elastic to encompass the purported acts of misconduct
        engaged in by [the Employees] on the days in question.

Court of Appeals of Indiana | Opinion 33A05-1505-PL-409 | November 12, 2015   Page 8 of 15
       Id. 3

[12]   The arbitrator went on to state,

                   The bifurcated disciplinary scheme reflected in the Minor
                   Infractions/Major Infractions table of misconduct offenses
                   paradigm set out in the [CBA] clearly demonstrates the Parties’
                   mutual agreement that when determining what disciplinary
                   action is warranted by particular acts of employee misconduct,
                   the first step is to properly categorize any such misconduct as
                   either a “Minor Infraction [] Class A,” “Minor Infraction Class
                   B,” or a “Major Infraction.” Stated simply, the misconduct with
                   which [the Employees] are charged does not rise to, or near the
                   level of perniciousness and malice reflected in the 13 specific acts
                   of misconduct set out in the Major Infractions element of the
                   contractual disciplinary scheme.

                   In fact, the acts of misconduct with which [the Employees] are
                   charged are specifically addressed in the Minor Infraction Class B
                   element of the contractual disciplinary scheme. Those specific
                   offenses, set out at Paragraph 5 of the Minor Infraction Class B
                   list of offenses, are “…, loafing or spending excessive time at
                   lunch periods.” This is precisely what the County claims [the
                   Employees] did on the three days in question.[ 4] Therefore, if the

       3
           In a footnote, the arbitrator stated,

                Thus, for example even if proven to have constituted misconduct warranting discipline, the
                [Employees’ actions] would not rise to the same level of perniciousness or malice as evidenced
                by the possession or use of alcohol and/or drugs while on duty; willfully damaging or defacing
                County property or equipment; insubordination evidenced by willfully disobeying a supervisor’s
                direct order; fighting on the job or on County property; or possession of firearms or other
                weapons while on duty or on County property.
       Appellants’ App. at 63-64.
       4
         In a footnote, the arbitrator stated, “It warrants mention that the Written Warnings, dated June 23, 2014
       and issued to the [Employees] on June 25, 2014, cite as the reason for those warnings ‘Minor Infraction Class
       B 5 sleeping on the job (loafing) or spending excessive time at lunch periods.’” Appellants’ App. at 64
       (citation to exhibits omitted).

       Court of Appeals of Indiana | Opinion 33A05-1505-PL-409 | November 12, 2015                      Page 9 of 15
                Arbitrator determines that the [Employees] actually engaged in
                those acts of loafing and/or spending excessive time on their
                lunch break then the disciplinary steps agreed to by the Parties in
                the Minor Infraction Class B portion of the contractual
                misconduct offenses paradigm would be applicable. The Major
                Infractions penalty of summary discharge on the first offense is
                not applicable in this Case. Thus, the County must prove that
                the actions of [the Employees] on the three days at issue
                nevertheless warranted their summary discharge, or some
                alternative less severe form of discipline.

       Id. at 64.

[13]   Ultimately, the arbitrator determined that the County had “failed to prove that

       the discharges of [the Employees] were for just cause” but that the Employees

       “did engage in repeated acts of misconduct that violated Paragraph 5 of the

       Minor Infraction Class B table of misconduct offenses set out in the Parties’

       [CBA]” and that “significant discipline [was] warranted.” Id. at 67. 5

       Consequently, the arbitrator overturned the discharges and imposed the

       following discipline:

                The gravity of the intentional acts of misconduct engaged in by
                [the Employees] is aggravated by their repetition over three
                consecutive workdays and by the fact that both [the Employees]

       5
         See Appellants’ App. at 66 (“The County’s complaint regarding the behavior of [the Employees] on June 23
       and 24, 2014, is well-enunciated by Superintendent Harless’ statement on cross examination that he was
       ‘dissatisfied with the quantity of the work and … [the] report [of] the truck sitting still and excessive breaks’.
       That [the Employees] on June 23 and 24 did in fact loaf, sit idle for moments of time, and work at a pace
       slower than expected in the operation of the DuraPatch truck to which they were assigned is clearly
       established by the relevant evidence in the hearing record.”) (citation to transcript omitted); id. at 67 (“[The
       Employees] offered no plausible explanation as to why they took a 65 minute lunch break sitting idle in that
       strip mall parking lot on what was supposed to have been a 30-minute lunch break [on June 25].”).

       Court of Appeals of Indiana | Opinion 33A05-1505-PL-409 | November 12, 2015                         Page 10 of 15
               hold high Union office and therefore should be expected to set an
               example for all bargaining unit employees. Having balanced the
               seriousness of the [Employees’] intentional, repeated acts of
               misconduct on the three days at issue against the mitigating
               factor of the procedural and substantive due process concerns
               raised by the County’s failure to promptly notify them of the
               wrongful nature of their workplace behavior before the end of
               their shift on June 25, 2014, the undersigned has determined that
               the appropriate disciplinary penalty for the misconduct engaged
               in by the [Employees] during the time period from June 23-25,
               2014, is the second offense penalty for Minor Infraction Class B
               offenses agreed to by the Parties in the [CBA] – a five-day layoff
               without pay.

       Id.

[14]   Thereafter, the County filed a motion with the trial court for application to

       correct or vacate the arbitrator’s award. In response, the Union filed an answer

       and counterclaim. The Union and the County filed cross-motions for summary

       judgment. The trial court summarily granted the Union’s motion and denied

       the County’s motion and “confirmed” the arbitrator’s award “in all respects.”

       Id. at 4. The County now appeals.

                                       Discussion and Decision
[15]   The County asserts that the trial court’s summary judgment ruling is erroneous.

               When reviewing the entry or denial of summary judgment, our
               standard of review is the same as that of the trial court: summary
               judgment is appropriate only where there is no genuine issue of
               material fact and the moving party is entitled to a judgment as a
               matter of law. Ind. Trial Rule 56(C). All facts established by the
               designated evidence and reasonable inferences drawn from those

       Court of Appeals of Indiana | Opinion 33A05-1505-PL-409 | November 12, 2015   Page 11 of 15
               facts are construed in favor of the nonmoving party. The fact
               that the parties filed cross-motions for summary judgment does
               not alter our standard of review. We consider each motion
               separately to determine whether the moving party is entitled to
               judgment as a matter of law.

       Wright v. City of Gary, 963 N.E.2d 637, 643 (Ind. Ct. App. 2012) (some citations

       omitted), trans. denied.

[16]   Indiana’s Uniform Arbitration Act (“the Act”) “provides a mechanism for

       enforcing agreements to arbitrate and for securing judicial review and

       enforcement of awards made.” Id. “Judicial review of an arbitration award is

       extremely narrow in scope.” Id. An award should be corrected or vacated only

       when one of the grounds specified by the Act for correcting or vacating an

       award is shown. See id. A party who seeks to correct or vacate an arbitration

       award under the Act bears the burden of proving the grounds for doing so. See

       id. “Courts may not review the merits of arbitration awards de novo.” Id. Our

       review of an arbitration award is limited to determining whether the party who

       seeks to correct or vacate the award has established any of the grounds for

       challenge permitted by the Act. See id.

[17]   “An arbitrator’s award is enforceable so long as it draws its essence from the

       collective bargaining agreement.” Fort Wayne Cmty. Sch. v. Fort Wayne Educ.

       Ass’n, 490 N.E.2d 337, 340 (Ind. Ct. App. 1986).

               A court will vacate an award only when the arbitrator’s words
               manifest an infidelity to this obligation. It is only when the
               arbitrator must have based his award on some body of thought,

       Court of Appeals of Indiana | Opinion 33A05-1505-PL-409 | November 12, 2015   Page 12 of 15
               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 collective bargaining agreement. We
               resolve any reasonable doubt regarding whether an award draws
               its essence from a collective bargaining agreement in favor of
               enforcing the award. Therefore, we will vacate an award only if
               there is no possible interpretive route to the award.

       Citizens Gas & Coke Util. v. Local Union No. 1400, Int’l Bhd. of Elec. Workers, 874

       N.E.2d 391, 397 (Ind. Ct. App. 2007) (citations, brackets, and quotation marks

       omitted).

[18]   Pursuant to Indiana Code Section 34-57-2-14(a), a court “shall modify or

       correct the award where … (2) the arbitrators have awarded upon a matter not

       submitted to them and the award may be corrected without affecting the merits

       of the decision upon the issues submitted[.]” And Indiana Code Section 34-57-

       2-13(a) provides that a court “shall vacate an award where … (3) the arbitrators

       exceeded their powers and the award can not be corrected without affecting the

       merits of the decision upon the controversy submitted[.]” The County contends

       that the arbitrator in this case “materially changed the CBA” and thus exceeded

       his authority in two respects: (1) by finding mitigating due process concerns

       based on the County’s compliance with the CBA’s three-day deadline for taking

       disciplinary action against the Employees; and (2) by not upholding the

       discharges based on each employee’s commission of three class B minor

       Court of Appeals of Indiana | Opinion 33A05-1505-PL-409 | November 12, 2015   Page 13 of 15
       infractions. Appellants’ Br. at 4. 6 Thus, argues the County, the arbitration

       award should be either corrected or vacated.

[19]   We first observe that the County does not challenge the arbitrator’s authority to

       determine that the offenses committed by the Employees were actually class B

       minor infractions and not major infractions as alleged by the County. 7 We

       further observe that the CBA mandates progressive discipline for class B minor

       infractions and that the County did not follow that mandate here. The County

       was put on notice that the Employees were loafing on June 23, but instead of

       promptly taking disciplinary action for that class B minor infraction, it waited

       until after the Employees committed two additional class B minor infractions to

       do so. This procedure circumvented the CBA’s progressive discipline scheme

       and deprived the Employees of adequate notice and an opportunity to reform

       their conduct. See Anderson v. Stauffer Chem. Co., 965 F.2d 397, 403 (7th Cir.

       1992) (stating that purpose of progressive discipline is “to give the employee

       adequate notice and an opportunity to correct any deficiencies”). Under these

       6
        As stated above, the parties stipulated that the issue before the arbitrator was whether the Employees were
       discharged for just cause and, if not, what the proper remedy should be. The County does not specifically
       argue that the Employees were discharged for just cause. Therefore, we do not address the Union’s argument
       about what constitutes just cause.
       7
         Nor does the County allege “extenuating circumstances” sufficient to upgrade any of the minor infractions
       to a major infraction under the CBA. Appellants’ App. at 44.

       Court of Appeals of Indiana | Opinion 33A05-1505-PL-409 | November 12, 2015                    Page 14 of 15
       circumstances, we find ample justification for the arbitrator’s due process

       concerns, which are drawn from the essence of the CBA. 8

[20]   Also, as the Union points out, the CBA states that the commission of a third

       class B minor infraction results in an employee being “Subject to Discharge”; it

       does not provide for automatic discharge. Appellants’ App. at 44. 9 And finally,

       the CBA does not prohibit an arbitrator from modifying an employee’s

       punishment; it merely prohibits modification of the CBA itself. The arbitrator

       did not modify the CBA by imposing a lesser punishment than discharge in this

       case.

[21]   In sum, the County has established no basis for correcting or vacating the

       arbitrator’s award. Therefore, we affirm the trial court’s summary judgment

       ruling.

[22]   Affirmed.

       May, J., and Bradford, J., concur.

       8
         This is not to suggest that the County must take disciplinary action against an employee immediately after
       an incident is reported, or that an employee may not be discharged for committing three class B minor
       infractions within a short period of time. But the County should be mindful of the purpose of the progressive
       discipline scheme mandated by the CBA and the risks of delaying disciplinary action or circumventing that
       scheme.
       9
           The same is true for a major infraction. Appellants’ App. at 45.

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