870 F.3d 235
3d Cir.2017Background
- The Western Pennsylvania Teamsters and Employees Welfare Fund is a multi-employer benefit plan governed by a Trust Agreement and by § 302(c)(5) of the LMRA; its board has five Union Trustees and five Employer Trustees.
- The Trust Agreement authorizes trustees to appoint an impartial umpire to resolve deadlocks, and if they cannot agree, either faction may petition the federal district court to appoint one (§ 3.15(a)); it also forbids the umpire from changing or modifying the Agreement (§ 3.15(b)).
- Two separate deadlocks arose: (1) Employer Trustees voted to authorize $600 payments to trustees for meeting attendance; Union Trustees objected and refused arbitration, arguing such compensation is unauthorized; (2) Union Trustees sought a ruling to “clarify and confirm” that Employer Trustees must be full-time employees of contributing employers; Employer Trustees refused arbitration, arguing the issue would effectively amend the Agreement.
- In both matters one faction petitioned the District Court to appoint an umpire; the District Court dismissed the compensation action and denied arbitrator appointment on the eligibility issue, finding the Trust Agreement did not permit the requested outcomes.
- The Trustees appealed; the Third Circuit reviewed de novo whether the disputes were arbitrable under the Trust Agreement and remanded with instructions to appoint an arbitrator for both disputes.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Arbitrability of compensation-for-attendance dispute | Employer Trustees: Trust grants trustees authority to use fund for necessary expenses and allowances, including attendance; dispute is interpretation and thus arbitrable | Union Trustees: Payment would amend the Trust Agreement; §3.15(b) forbids umpire from changing Agreement, so arbitration is not authorized | Court: Dispute is contract interpretation within trustees’ powers; presumption of arbitrability applies; remand to appoint arbitrator |
| Arbitrability of Employer-Trustee eligibility (full-time employee) | Union Trustees: Motion to “clarify and confirm” seeks interpretation (not amendment) of Agreement and is within trustees’ authority to construe, so arbitrable | Employer Trustees: Decision would effectively amend the Trust Agreement; arbitrator lacks power to modify terms so this is non-arbitrable | Court: "Clarify and confirm" is interpretation, not amendment; arbitrable; remand to appoint arbitrator |
Key Cases Cited
- Arroyo v. United States, 359 U.S. 419 (1959) (context on §302’s purpose to curb corruption in collective bargaining)
- Associated Contractors of Essex Cty., Inc. v. Laborers Int'l Union of N. Am., 559 F.2d 222 (3d Cir. 1977) (discusses §302 equal-representation exception for benefit funds)
- AT & T Technologies, Inc. v. Communications Workers of America, 475 U.S. 643 (1986) (principle that courts decide arbitrability absent clear and unmistakable delegation)
- Granite Rock Co. v. International Brotherhood of Teamsters, 561 U.S. 287 (2010) (doubts about arbitrability resolved in favor of arbitration where parties agreed)
- United Steelworkers v. Lukens Steel Co., 969 F.2d 1468 (3d Cir. 1992) (articulates arbitration presumption and standards for arbitrability review)
- United Steelworkers of America v. Warrior & Gulf Navigation Co., 363 U.S. 574 (1960) (arbitration is a matter of contract; parties cannot be compelled to arbitrate disputes they did not agree to submit)
- Struble v. N.J. Brewery Employees’ Welfare Trust Fund, 732 F.2d 325 (3d Cir. 1984) (trust agreement may expand umpire jurisdiction beyond §302 baseline)
- Farmer v. Fisher, 586 F.2d 1226 (8th Cir. 1978) (defines §302 administration more narrowly—day-to-day matters)
- Mahoney v. Fisher, 277 F.2d 5 (2d Cir. 1960) (defines §302 administration broadly to include matters trustees are empowered to decide)
- Ader v. Hughes, 570 F.2d 303 (10th Cir. 1978) (distinguishes ordinary administration from extraordinary matters such as amendments)