Court Opinion

ID: 9859058
Source: CourtListenerOpinion
Date Created: 2023-09-24 18:34:55.777823+00
Date Added: 2024-06-11T10:05:49.183398
License: Public Domain

Justice LONG,
dissenting.
Although this case was a procedural anomaly, the fundamental questions it presents are relatively straightforward: who determines whether a matter is arbitrable; and, once a declaration of arbitrability issues, what is the function of the arbitration? Here, the union challenged a member’s termination for supplying false information regarding his criminal history. The matter proceeded to arbitration, at which point the employer disputed the jurisdiction of the arbitrators, claiming that the employee’s probationary status precluded resort to the grievance procedure set forth in the collective bargaining agreement (CBA).
*123Instead of staying the arbitration in favor of a judicial determination of arbitrability or adjudicating the merits of the claim subject to a later judicial decision regarding arbitrability, the arbitrators decided that the employee was not entitled to arbitrate his claim and dismissed the grievance. When that award was confirmed, the Appellate Division reversed and ordered a new arbitration, declaring that the CBA was susceptible of an interpretation favoring arbitrability.
The majority disagrees, essentially adopting a no-harm, no-foul paradigm based on the notion that the employee in fact was permitted to arbitrate his grievance and thus received the process that was due. The problem with that analysis is that it is based on a faulty premise regarding the question to be arbitrated. The majority apparently views the arbitrable issue to be whether a probationary employee is entitled to access the grievance procedure. Ante at 119, 975 A.2d at 412-13. Because that is an issue that is reserved to the court and, in fact, was decided by the Appellate Division, it cannot be subject to second-guessing by the arbitrators. The arbitrators were limited to the question of the propriety of the employee’s termination. Because they never addressed that issue on the merits, the Appellate Division’s order that a new arbitration take place was the only option. Insofar as the majority rules otherwise, I cannot join its opinion.
I.
The facts have been detailed in the majority opinion and will not be recounted here in full. In brief, Juan Anaya completed an application for employment with New Jersey Transit Bus Operations, Inc. (“NJ Transit”), and was hired as a bus cleaner. Following his thirtieth day of employment, Anaya became a member of Amalgamated Transit Union, Local 880 (“Union”), as required by the CBA. He was discharged on November 10, 2004, for falsifying his employment application by certifying that he had never been convicted of any “crime or offense.” The Union denied that Anaya had been convicted of any crime or offense, arguing that *124the “conditional discharge” he had received was not a conviction. It thus claimed that Anaya had not falsified his application, challenged his termination through the CBA’s grievance procedure, and ultimately sought arbitration when the matter could not be resolved satisfactorily. NJ Transit objected to the arbitration on the ground that Anaya, a probationary employee, was not entitled to access the grievance procedure. The arbitrators agreed and dismissed the grievance. A trial judge confirmed that award and the Appellate Division reversed.
In doing so, the panel correctly recognized its role as the determiner of matters of “substantive” arbitrability. Substantive arbitrability refers to the pure question of “whether the particular grievance is within the scope of the arbitration clause.” Standard Motor Freight, Inc. v. Local Union No. 560, Int’l Bhd. of Teamsters, 49 N.J. 83, 96, 228 A.2d 329 (1967). Relying on the language of the CBA, the panel concluded that the grievance was arbitrable. That decision was legally unexceptionable.
Section 1 of the CBA provides that “each employee covered in this agreement shall have the right provided in this agreement for the adjustment of grievances.” Section 1A, in turn, outlines the grievance procedure, which governs “any dispute or grievance [that] arise[s] between the Company and the Union, or any of its members, as to the interpretation, application, or operation of any provisions of this agreement, not specifically settled in said agreement.” Anaya became a Union member after thirty days as required by Section 1C of the CBA, which prescribes: “All present employees and all new employees shall become and remain members in good standing of the Union as a condition of continuous employment with the Company. Employees entering the service of the Company shall become members of the Union after 30 days.” Accordingly, he was “covered” by the CBA.
Section 1C also provides that “the 90-day probationary period agreed to by the employee on applying for a position with the Company will be recognized.” Of that provision, the Appellate Division stated the obvious—that it “does not expressly exclude *125probationary employees from the right to grieve that is recognized in Section 1A.” Contrapuntally, the panel noted that the CBA unequivocally excludes other categories of employees from the scope of arbitration, citing subsection P(j), which provides: “Part-time operators shall be entitled to, and covered by, the contract provisions of Union membership and checkl-Joff on a non-discriminatory basis, and the grievance procedure after co'inpletion of the probationary period,.”1 (Emphasis added). Given that the CBA granted Union members access to the grievance procedure and only conditioned that access on completion of the probationary period in respect of seasonal and part-time operators, the panel concluded, as a matter of law, that the Union was entitled to arbitrate Anaya’s termination because
“the party seeking arbitration is making a claim which on its face is governed by the contract.” Winston-Salem Mailersl Union 133 v Media Gen. Operations, Inc, 55 Fed. App'x 128, 184 (4th Cir.2008) (internal quotation marks and citation omitted) ]. This is so because a termination of employment is indisputably subject to grievance and arbitration under this CBA. As in United Steelworkers [Steel Workers of America, AFL-CIO v. Century Aluminum of Kentucky, 157 Fed. App'x 869, 874 (6th Cir.2005), the Union, at the very least, is entitled to arbitrate the issue of Anaya’s guilt,
f (Footnote omitted).]
The Appellate Division’s analysis gives voice to the presumption in favor of arbitration, see Pascack Valley Reg’l High Sch. Bd. of Educ. v. Pascack Valley Reg’l Support Staff Ass’n, 192 N.J. 489, 496, 933 A.2d 589 (2007), and perfectly captures the notion of what is at the heart of the substantive-arbitrability inquiry: unless “ ‘the arbitration clause is not susceptible of an interpretation that covers the asserted dispute,’ ” the matter is arbitrable, Standard Motor Freight, supra, 49 N.J. at 96, 228 A.2d 329 (emphasis added) (quoting United Steelworkers of Am. v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582-83, 80 S.Ct. 1347, 1353, 4 L.Ed.2d 1409, 1417 (1960)). “In the absence of any express provision excluding a particular grievance from arbitration, ... *126only the most forceful evidence of a purpose to exclude the claim from arbitration can prevail, particularly where ... the exclusion clause is vague and the arbitration clause quite broad.” United Steelworkers of Am. v. Warrior & Gulf Navigation Co., supra, 363 US. at 584-85, 80 S.Ct. at 1354, 4 L.Ed.2d at 1419. The CBA in this ease contains no such forceful evidence of exclusion.
To the extent the majority suggests that the employment agreement was incorporated by reference into the CBA and circumscribed the right to grieve that was afforded to Union members, ante at 122 n. 5, 975 A.2d at 414 n. 5, it is wide of the mark. To be sure, a CBA can incorporate another document by reference and, when that occurs, the court will look to that document as well in deciding substantive arbitrability. See Pascack Valley, supra, 192 N.J. at 498-99, 933 A.2d 589. However, even if that is the case, where provisions in the incorporated document “conflict with the terms in a[CBA], and diminish or interfere with rights provided by the [CBA],” the conflicting language in the incorporated document “must yield to the collective agreement.” Mount Holly Twp. Bd. of Educ. v. Mount Holly Twp. Educ. Ass’n, 199 N.J. 319, 322, 972 A.2d 387 (2009) (citing Lullo v. Int’l Ass’n of Fire Fighters, Local 1066, 55 N.J. 409, 428, 262 A.2d 681 (1970); Troy v. Rutgers, 168 N.J. 354, 375-76, 774 A.2d 476 (2001)).
Here, the CBA clearly denominates Union members as “covered” employees entitled to access the grievance procedure. Although the CBA also “recognize[s]” the probationary period, it does not condition a Union member’s resort to the grievance procedure on completion of probation. The only exceptions in the CBA involve part-time and seasonal employees, who are specifically denied the right to the grievance procedure prior to their completion of probation. To the extent that the language of the employment agreement purports to apply that condition to all Union members, it effectively diminishes the rights afforded by the CBA and must, in any event, yield. Ibid. Thus, whether the CBA is viewed alone or in connection with the employment *127agreement, the result is the same: the arbitration clause is susceptible of an interpretation that covers Anaya.
For me, the nub of this case is not the propriety of the court’s decision regarding arbitrability, but what occurs thereafter. The majority apparently agrees with the Appellate Division’s declaration of arbitrability, but views the question before the arbitrators to be whether a probationary employee may access the grievance procedures. Ante at 119, 975 A.2d at 412. Not so. That was the question that was substantively decided by the court and accordingly it was not subject to a rehash in arbitration.
When the question of arbitrability was answered affirmatively by the Appellate Division, only the merits of the grievance remained to be resolved. The issue at that point was whether Anaya’s pre-employment representations warranted separation from service.2 To be sure, if there had been purely procedural issues to be resolved, for example whether the steps of the grievance procedure had been satisfied, those issues would have been for arbitration. Standard Motor Freight, supra, 49 N.J. at 97, 228 A.2d 329 (citing John Wiley & Sons, Inc. v. Livingston, 376 U.S. 543, 557-59, 84 S.Ct. 909, 918-19, 11 L.Ed.2d 898, 909-10 (1964)); see, e.g., Troy Chem. Corp. v. Teamsters Union Local No. 408, 37 F.3d 123, 126 (3d Cir.1994) (holding that question of whether parties “had by practice waived steps 1 and 2 of the *128grievance procedure was a question of procedure for the arbitrator and not the court”). What the arbitrators could not do was determine the fundamental issue of substantive arbitrability.
It follows that because the only matter decided by the arbitrators was beyond their ken, and the substance of the grievance was never reached, there is no role here for the reasonably-debatable standard. See Bd. of Educ. of Alpha v. Alpha Educ. Ass’n, 190 N.J. 34, 43, 918 A.2d 579 (2006) (citing State v. Int’l Fed’n of Prof'l & Technical Eng’rs, Local 195, 169 N.J. 505, 514, 780 A.2d 525 (2001)) (observing that reasonably-debatable standard applied because substantive arbitrability was undisputed and only procedural arbitrability was contested).
Here, the Appellate Division properly understood its role and rendered a determination of arbitrability that conformed in every respect to applicable labor-law principles. As a result, it reversed and remanded the matter for a merits determination by the arbitrators. Because I am in accord with that outcome, I respectfully dissent.
Justice ALBIN joins in this opinion.
For reversal and reinstatement—Chief Justice RABNER and Justices LaVECCHIA, WALLACE, RIVERA-SOTO and HOENS—5.
For affirmance—Justices LONG and ALBIN—2.

 Subsection Q of the CBA also excludes seasonal operators from resort to the grievance procedure until "aftei completion oí the probationary period."

 Columbian Carbon Co. v. International Union of Operating Engineers, Local Union No. 405, 360 F.2d 1018, 1020-21 (1966), provides ail instructive application of that well-established framewoik. There, the employer argued that the grievants were not entitled to arbitrate their wage complaint because they were temporary employees. Id. at 1018. The union countered that the temporary workers were covered by the collective bai gaining agreement because the arbitration clause permitted " ‘any employee'" to seek arbitration for such complaints. Id. at 1020. The court, noting that the collective bargaining agreement was susceptible of the union's interpretation, compelled arbitration of the wage dispute, id. at 1020-21, “ 'fwjithout ... undertaking to determine what the facts are or will be shown to be in respect of the matter for arbitration or what the decision in the arbitration should be,' " id. at 1021 (quoting Gulf Oil Corp. v. Int'l Union of Operating Eng’rs, Local No. 715, 279 F.2d 533, 536 (5th Cir.), cert. denied, 364 U.S. 871, 81 S.Ct. 112, 5 L.Ed.2d 92 (1960))