Court Opinion

ID: 9463472
Source: CourtListenerOpinion
Date Created: 2023-08-04 23:08:16.172342+00
Date Added: 2024-06-11T17:38:08.272757
License: Public Domain

MOORE, Circuit Judge
(dissenting):
I dissent from the majority’s enforcement of this arbitration award because the arbitrator’s decision is inconsistent and irrational and exceeds the contractual authority accorded the arbitrator by the collective bargaining agreement.
The arbitrator derives his authority solely from the collective bargaining agreement between the Amoco Oil Company, Whiting Refinery (“Company”), and the Oil, Chemical and Atomic Workers International Union, Local 7 — 1, Inc. (“Union”), so any action taken by him in derogation of the agreement must be null and void. The agreement expressly provides in the Preamble that it does not intend “in any way to infringe or impair” Management’s “right to discharge employees for just cause.” (Emphasis added).
The grievance procedures established in Article II of the bargaining agreement, including arbitration, complement Management’s prerogative by unambiguously providing for only a limited review of the Company’s decision to discharge: if the Company had “just cause” for the discharge, its action must be upheld. The grievance procedures do not empower an arbitrator to second-guess Management as to what course of action should fairly be taken almost two years after the events of which a grievant complains. As the Supreme Court stated in United Steelworkers v. Enterprise Wheel and Car Corp., 363 U.S. 593, 80 S.Ct. 1358, 4 L.Ed.2d 1424 (1960), in setting forth the standard for judicial review of industrial arbitration awards:
When an arbitrator is commissioned to interpret and apply the collective bargaining agreement, he is to bring his informed judgment to bear in order to reach a fair solution of the problem. Nevertheless, an arbitrator is confined to interpretation and application of the collective bargaining agreement; he does not sit to dispense his own brand of industrial justice. He may of course look for guidance from many sources, yet his award is legitimate only so long as it draws its essence from the collective bargaining agreement. When the arbitrator’s words manifest an infidelity to this obligation, courts have no choice but to refuse enforcement of the award. 363 *1297U.S. at 597, 80 S.Ct. at 1361 (emphasis added).
This court endorsed these guidelines most recently in Cannon v. Consolidated Freightways Corp., 524 F.2d 290, 295 (7th Cir. 1975), where it explained that
[o]f course, a court may review and set aside an award if . the arbitrator exceeds his contractual authority.
See also International Ass’n. of Machinists, Dist. No. 8 v. Campbell Soup Company, 406 F.2d 1223, 1225 (7th Cir.), cert. denied, 396 U.S. 820, 90 S.Ct. 57, 24 L.Ed.2d 70 (1969); Torrington Co. v. Metal Products Workers Union Local 1645, 362 F.2d 677, 680 (2d Cir. 1966).
Pursuant to the Company-Union bargaining agreement, this arbitrator was empowered only to make a finding on the single issue of whether or not the Company had acted with “just cause” in discharging Se-man on September 14, 1973. The agreement vested no authority in the arbitrator to make his own determination as to whether he would have discharged Seman in 1973 or at any other time. Nor did the agreement authorize the arbitrator to weigh the “facts” available in October, 1975 to decide what he felt the company should do in the way of fair treatment of its former employee. Yet these unauthorized determinations, which in no way draw their “essence” from the collective bargaining agreement, are precisely those from which the arbitrator derived his award.
The arbitrator expressly found in the first sentence of his analysis, and repeated in similar words later in his opinion, that in fact “the Company on September 14, 1973, had just cause to discharge the Grievant [Seman].” This conclusion was amply supported by the arbitrator’s findings of fact. Company policy had long made theft of company property a ground for discharge. Seman, admittedly without authorization, had over $30,000 worth of the Company’s heavy industrial equipment in the basement of his home on September 11, 1973, and he offered no plausible explanation as to how it came to be there. His only response was to allege, without any factual support, that some unidentified persons must have conspired to “plant” the equipment in his basement. Troubling issues, such as how this could be accomplished without his knowledge, and why his adversaries would stockpile several tons of contraband when a mere jackhammer would have sufficed, he left unanswered. As the arbitrator found, the damaging inference of the unauthorized possession of company property provided ample “just cause” for the discharge, establishing that the Company acted entirely within its contractual right.
The substantive accuracy of this conclusion of the arbitrator is not the focus of our inquiry. Rather, the conclusion is significant because it demonstrates that with his express finding that the Company had acted properly in 1973, he fully expended his mandate under the collective bargaining agreement. With that finding he had completed the performance of his duties, and his investigation should then have terminated. Yet, he went beyond reviewing the authority for the Company’s decision, reasoning that as of October 6, 1975, “just cause” for discharge no longer existed. But Seman’s conduct as of October 6, 1975 was completely irrelevant to the issue of the propriety of his discharge, for it was only the September, 1973 discoveries upon which the discharge in issue was based. This second conclusion is quite obviously a separate finding regarding the existence of “just cause”, unrelated to the first finding and wholly dehors the arbitrator’s scope of authority. It shows a “manifest disregard” of the bargaining agreement and in itself requires vacatur of the award.
No amount of interpretation by the majority, no mitigating judicial reformulation of the “thrust” of the arbitrator’s decision, can conceal or explain away the fact that the award was grounded on this second, unauthorized finding that “as of October 6, 1975, the Company does not have just cause for discharging the Grievant [Seman]. . ” To recognize that the award was so grounded does not, as the majority suggest, “elevate style over substance”; it simply admits the literal existence of two dis*1298tinct findings relative to “just cause.” In making the second determination, the arbitrator placed himself in the role of management and ignored the fact that his authority was limited to interpreting and applying the collective bargaining agreement. In other words, he began to “dispense his own brand of industrial justice”, something he is prohibited from doing.
As a result of the arbitrator’s unauthorized veto of a managerial decision protected by the collective bargaining agreement, the Company was ordered to reinstate Seman even though it had not been found to have breached the bargaining agreement by discharging him. Yet, without a finding of breach the discharge of Seman can only be deemed entirely proper. The decision of the arbitrator is thus inconsistent and irrational, and even extensive rewriting of it by this court cannot make it properly enforceable.
Accordingly, I would vacate the award.