In the Matter of the Arbitration Between UNITED ELECTRICAL, RADIO AND MACHINE WORKERS, 16 N.Y.2d 327 (1965)
When a collective bargaining agreement contains a broad arbitration clause, disputes regarding subcontracting practices are generally arbitrable, especially if the agreement contains provisions addressing recognition of the union and layoffs.
Summary
This case concerns whether a dispute over subcontracting work previously performed by union employees is subject to arbitration under a collective bargaining agreement. The Court of Appeals held that the dispute was arbitrable because the agreement’s recognition and layoff provisions could be interpreted to address the issue of subcontracting. The court emphasized the presumption of arbitrability in labor disputes and the limited role of courts in determining whether a dispute falls within the scope of an arbitration clause.
Facts
The United Electrical, Radio and Machine Workers Union (Union) had a collective bargaining agreement with General Electric Company (GE) covering janitors, porters, and charwomen at GE’s Baltimore and Hudson Falls-Fort Edward plants. The agreement contained grievance and arbitration procedures for disputes involving the interpretation or application of the agreement. GE contracted out cleaning services, resulting in the layoff of union members. The Union filed grievances, arguing that GE violated the agreement by subcontracting work that was traditionally performed by union employees.
Procedural History
The Union sought arbitration, but GE refused, arguing the dispute was not arbitrable. The Union then initiated a proceeding to compel arbitration. The Special Term court dismissed the petition, finding the dispute did not involve the interpretation or application of any provision of the agreement. The Appellate Division reversed, holding that the matter was arbitrable in the absence of clear language excluding the dispute from arbitration. GE appealed to the New York Court of Appeals.
Issue(s)
Whether a dispute regarding the company’s decision to subcontract work previously performed by union employees constitutes an arbitrable issue under the collective bargaining agreement’s provisions concerning union recognition and layoffs.
Holding
Yes, because the union’s grievances present arbitrable issues as to the “interpretation or application” of the recognition and layoff provisions of the collective bargaining agreement. The court found that the broad arbitration clause encompassed disputes requiring interpretation of the agreement’s provisions, even if the interpretation was contested.
Court’s Reasoning
The court relied on federal law, which establishes a presumption of arbitrability in labor disputes affecting interstate commerce, citing Steelworkers v. Warrior & Gulf Navigation Co., 363 U. S. 574, 582-583. It emphasized that courts should only determine whether a dispute is arbitrable, not the merits of the dispute itself. The court stated, “It is only where the parties have employed language which clearly rebuts [such] presumption of arbitrability, e.g., by stating that an issue either as to procedure or as to substance is not to be determined by arbitration, that the matter may be determined by the courts.” The court found that the agreement’s recognition clause (Article I), where the company agreed to recognize the Union as the exclusive bargaining representative, required interpretation to determine if subcontracting violated that provision. It reasoned that the arbitrator must decide if the recognition clause imposed a continuing duty on the employer to assign work customarily performed in the plant to union members. Furthermore, the court held that the layoff provision (Article XII), applicable to “all cases of layoff or transfer due to lack of work,” presented an arbitrable question because it was unclear whether the subcontracting, where the same work continued to be performed by non-union members, constituted a “lack of work” within the meaning of the clause. The court distinguished its holding from cases where subcontracting involved work union members were unable to perform. The court also rejected the argument that collective bargaining history should be considered when determining arbitrability, stating such evidence bears on the merits of the dispute and not whether the dispute is arbitrable.