315 F.2d 513 | 2d Cir. | 1963
Lead Opinion
Plaintiff James Belk, a resident of New York, was employed by Allied Aviation Service Company of New Jersey, Inc. (Allied) as a Sky Cap Porter at the Municipal Airport, Newark, New Jersey. He is a member of Local 297 of the United Transport Service Employees (the Union), the recognized bargaining agent for plaintiff, and is subject to a collective bargaining contract between Allied and the Union. While working on September 29, 1961, Belk received a letter terminating his services without giving him notice of a hearing as required in such cases under the terms of the contract.
Without any effort to obtain redress for his discharge through his Union, Belk brought suit directly against Allied in the Southern District of New York for damages as a result of the alleged breach. Jurisdiction was founded on diversity of citizenship. The Court below granted defendant’s motion to dismiss and Belk appeals.
Appellant argues that the failure of the Company to offer him a hearing was a breach of the agreement entitling him to damages in a suit on the contract. He further contends that since the Union does not enter the procedure until the Company has made a determination of his status after a hearing and, since the Union can request arbitration only if it feels that the decision is unfair, recourse to arbitration through the Union before suit is not only unnecessary but is foreclosed under the contract since no such determination after a hearing has been made.
The broad coverage and intent of the contract to seek “amicable adjustment” instead of court litigation is apparent from the opening clause of the Article 21: “No Strike — No Lockout”, reading, “As this agreement provides for the amicable adjustment of any and all disputes and grievances, * * Assuming that failure to give notice made the specific provisions of Article 20(d) unavailable, Article 20(e) provides that:
*515 “When a dispute or claim involving the application, construction, interpretation or performance of the rules of this agreement occurs, the parties agree that they shall endeavor in good faith, first to adjust and settle such disputes between themselves after a fair hearing. Fáiling such adjustment or settlement between themselves, either party may demand arbitration by an arbitrator designated by the Federal Mediation and Conciliation Service; the other party must agree thereto, and the decision and award of said arbitrator shall be final and binding upon the parties. The cost of any •arbitration, if any, shall be borne equally by the parties hereto.”
Although the preliminary procedures prescribed in this contract for the prosecution of eases of wrongful discharge may be somewhat unusual, a dispute over the Company’s breach of the notice and hearing provisions constitutes a dispute involving “performance of the rules of this agreement.” Any collective agreement is intended to secure rights for individual employees; notice and a hearing after discharge are merely examples of such rights. They are no different from provisions with respect to seniority, vacations or overtime pay. Under the broad arbitration clause set out above, controversies concerning these matters were clearly intended to be submitted to arbitration as agreed upon in the contract. So too the breach of contract alleged in this case.
That a matter of procedure rather than one of substance is involved is of no significance. In fact, we recently held that the question of compliance with the procedural prerequisites to arbitration set forth in the collective agreement is to be decided by the arbitrator and not the court. Livingston v. John Wiley & Sons, Inc., 313 F.2d 52 (Jan. 11, 1963). What effect is to be given this breach by the employer, whether the arbitrator would require that the employer give Beik a hearing or whether he would find jurisdiction to deal with this discharge on the merits are all questions that the contract contemplates will be submitted to the arbitrator.
This being the case, the remaining question is the effect of the arbitration clause on the individual’s right to sue for breach of contract. Since this is a diversity case, there is no question of this court’s jurisdiction to entertain this action. Even were this not so, the Supreme Court in Smith v. Evening News Association, 371 U.S. 195, 83 S.Ct. 267, 9 L.Ed.2d 246 (1962), held that suits by individuals are cognizable in the federal courts under Section 301. In addition, that Court held that all such suits are to be governed by federal law. However, the opinion in that case indicates in no uncertain terms that the Court was not striking down arbitration in favor of suits by individual employees in the courts because the Court specifically said, “There was no grievance arbitration procedure in this contract which had to be exhausted before recourse could be had to the courts.” 371 U.S. 196, n. 1, 83 S.Ct. 271, and invited comparison with its recent decisions in Atkinson v. Sinclair Refining Co., 370 U.S. 238, 82 S.Ct. 1318, 8 L.Ed.2d 462, and Drake Bakeries, Inc. v. Local 50, American Bakery Workers, 370 U.S. 254, 82 S.Ct. 1346, 8 L.Ed. 2d 474.
We need not at this juncture try to resolve all these problems even assuming (which we do not) that such a herculean effort were possible because the case before us does not require it. We decide only that where the collective agreement provides for arbitration'by the Union of the subject matter of the employee’s suit, the employee must look to his union initially for the vindication of his rights.
The entire import of the Supreme Court cases beginning with Lincoln Mills, through the trilogy of the Steelworker cases to Drake at their last term is that arbitration, when agreed upon by the parties, is the best method for reconciliation of disputes arising out of collective agreements. Where an arbitration clause admits of a construction including the dispute in question within its ambit, recourse to the courts before any effort is made to process the dispute through arbitration is to be looked upon with disfavor. As we said recently:
“The union represents the employees for the purposes of negotiating and enforcing the terms of the collective bargaining agreement. This is the modern means of bringing about industrial peace and channeling the resolution of intra-plant disputes. Chaos would result if every disenchanted employee, every disturbed employee, and every employee who harbored a dislike for his employer, could harass both the union and the employer by processing grievances through the various steps of the grievance procedure and ultimately by bringing an action to compel arbitration in the face of clear contractual provisions intended to channel the enforcement remedy through the union.” Black-Clawson Co. v. International Association of Machinists, 313 F.2d 179 (2d Cir., Dec. 22, 1962).”
Affirmed.
. Article 20 of the collective agreement reads as follows:
“Article 20. — Discipline and Investigation.
“a. No employee who has been in service for ninety (90) days will be disciplined or dismissed without a fair and impartial hearing. However, an employee may be suspended immediately pending such investigation. The accused employee will be advised in writing of the precise charge against him within five (5) days, exclusive of holidays, after the date of the occurrence, and a hearing will be held within five (5) days from the date of the written notice. At the hearing the employee may be present and have representatives of his own choosing. He will be permitted to hear all evidence against him and question all witnesses and/or statements submitted against him. A decision will be rendered in writing within five (5) days after the hearing is completed. Reasonable opportunity will be allowed employees to secure the presence of their representatives, and it shall be the obligation of management to summon all witnesses whom the employee feels can present facts which will lend weight to his testimony.
“b. A written transcript may be made of all hearings at the discretion of the employee and the management at their own respective costs.
“c. If the decision is in favor of the employee, his record will be cleared of the charge and if held from the service, he will be reinstated and compensated for the wage loss, if any, suffered by him. Such compensation will be the amount he would have earned from the Company, less compensation received in other employment.
“d. If the Union feels that the decision is unfair, the parties agree that they shall endeavor in good faith to settle the issue. Failing such settlement, either party may demand arbitration by an arbitrator designated by the Federal Mediation and Conciliation Service; the other party must agree thereto, and the decision and award of said arbitrator shall be final and binding upon the parties. The cost of any arbitration, if any, shall be borne equally by the parties hereto.
“e. When a dispute or claim involving the application, construction, interpretation or performance of the rules of this agreement occurs, the parties agree that they shall endeavor in good faith, first to adjust and settle such disputes between themselves after a fair hearing. Failing such adjustment or settlement between themselves, either party may demand arbitration by an arbitrator designated by the Federal Mediation and Conciliation Service; the other party must agree thereto, and the decision and award of said arbitrator shall be final and binding upon the parties. The cost of any arbitration, if any, shall be borne equally by the parties hereto.”
. The Court also made clear that it was only deciding a jurisdictional question and not resolving the issue of the substantive rights of individuals subject to Union contracts. The Court stated that:
“The only part of the collective bargaining contract set out in this record is the no-discrimination clause. Respondent does not argue here and we need not consider the question of federal law of whether petitioner, under this contract, has standing to sue for breach of the no-discrimination clause nor do we deal with the standing of other employees to sue upon other clauses in other contracts.” 371 U.S. 195, 201, n. 9, 83 S.Ct. 267, 270.
. See, e. g., Transcontinental & Western Air, Inc. v. Koppal, 345 U.S. 653, 73 S.Ct. 906, 97 L.Ed. 1325 (1953) (applying Missouri law) ; Ostrofsky v. United Steelworkers, 171 F.Supp. 782 (D.Md.1959), aff’d 273 F.2d 614 (4th Cir.), cert. denied, 363 U.S. 849, 80 S.Ct. 1628, 4 L.Ed.2d 1732 (1960) ; Guszkowski v. United States Trucking Corp., 162 F.Supp. 847 (D.C.N.J.1958) ; United States v. Voges, 124 F.Supp. 543 (E.D.N.Y.1954) ; Parker v. Borock, 5 N.Y.2d 156, 182 N.Y.S.2d 577, 156 N.E.2d 297 (1959) ; Mellow v. Local 4408, 82 R.I. 60, 105 A.2d 806 (1954). See generally Cox, Rights Under a Labor Agreement, 69 Harv.L.Rev. 601, 645-655 (1956). A minority of courts have held to the contrary. See Woodward Iron Co. v. Ware, 261 F.2d 138 (5th Cir., 1958) ; In re Norwalk Tire & Rubber Co., 100 F.Supp. 706 (D.C.Conn.1951) ; Alabama Power Co. v. Haygood, 266 Ala. 194, 95 So.2d 98 (1957).
. The Supreme Court has indicated that the authority of the bargaining representative is not absolute and that there is a duty to fairly represent all members. E. g., Steele v. Louisville & N. R. Co., 323 U.S. 192, 65 S.Ct. 226, 89 L.Ed. 173 (1944) ; Tunstall v. Brotherhood of Locomotive Firemen, 323 U.S. 210, 65 S.Ct. 235, 89 L.Ed. 187 (1944). See, also, Clark v. Hein-Warner Corp., 8 Wis.2d 264, 268, 99 N.W.2d 132, 100 N.W.2d 317 (1959). However, the Union is allowed a certain measure of discretion in bargaining, Ford Motor Co. v. Huffman, 345 U.S. 330, 73 S.Ct. 681. 97 L.Ed. 1048 (1953). and in determining whether to prosecute grievances, Union News Co. v. Hildreth, 295 F.2d 658 (6th Cir., 1961) ; Cortez v. Ford Motor Co., 349 Mich. 108, 84 N.W.2d 523 (1957). Some courts are of the view that the employee can sue the employer where the Union has acted in an arbitrary or discriminatory manner, see Ostrofsky v. United Steelworkers, supra, n. 3, Jenkins v. Wm. Schluderberg T. J. Kurdle Co., 217 Md. 556, 144 A.2d 88 (1958) ; cf. Pattenge v. Wagner Iron
Concurrence Opinion
(concurring in the result).
Of course noncompliances with procedural provisions of the arbitration clauses in collective bargaining agreements should be subjects of arbitration. See Livingston v. John Wiley & Sons, 2 Cir., 313 F.2d 52; Carey v. General Electric Co., 2 Cir., 315 F.2d 499; Note, Procedural Requirements of a Grievance Arbitration Clause: Another Question of Arbitrability, 70 Yale L.J. 611 (1961). The problem for me is that Black-Clawson Co. v. International Asso. of Machinists Lodge 355, Dist. 137, 2 Cir., 313 F.2d 179, closed to individual employees the sort of provision (see Article 20.e of the collective bargaining agreement, quoted in note 1 of the majority opinion) which my brothers now hold up to this employee as their reason for refusing to entertain his case. I would have preferred that the individual employee should not be left solely to the mercies of his employer and his union. See Summers, Individual Rights in Collective Agreements and Arbitration, 37 N.Y.U.L.Rev. 362 (1962). For we have seen in recent years that, in some cases, a sweet harmony develops between the two that proves a bitter lockout of the solitary employee who finds his contractual rights going unprotected. Here Belk was dismissed in flagrant violation of Article
But the law of the circuit has apparently been determined to the contrary, and so I shall join in my brothers’ disposition of this case, adding only the hope that Belk’s union may yet act to rectify his wrong.