United States Court of Appeals
For the First Circuit
No. 05-2614
SALEM HOSPITAL,
Plaintiff, Appellee,
v.
MASSACHUSETTS NURSES ASSOCIATION,
Defendant, Appellant.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Richard Stearns, U.S. District Judge]
Before
Lipez, Circuit Judge,
Cyr and Stahl, Senior Circuit Judges.
James F. Lamond for appellant.
Richard P. Ward for appellee.
June 2, 2006
STAHL, Senior Circuit Judge. This is an appeal by the
Massachusetts Nurses Association ("MNA" or "the Union") of the
district court's order vacating an arbitration award. The award
was rendered pursuant to the binding arbitration process for
dispute resolution provided for in the collective bargaining
agreement between the Union and Salem Hospital. We affirm the
decision of the district court, although for different reasons from
those offered by that court.
I. Background
A. The Dispute
The Union represents most of the nurses who work at Salem
Hospital in Salem, Massachusetts.1 Among the represented group of
nurses is the nursing staff of the Hospital's Post-Anesthesia Care
Unit ("PACU"). Up until 1993, the PACU unit had a fully staffed
night shift of nurses during the week and used an on-call system
for night shifts on the weekends.2 In 1993, the Hospital
eliminated the weekday full night shift of nurses and switched to
the on-call system during the week as well.3 The collective
1
The employee bargaining unit encompasses "all full-time and
regular part-time registered nurses employed by the Hospital,"
excluding certain managers and supervisors.
2
On-call requires the nurses who are on call for any given
night to carry a pager and be ready to come to work if needed.
3
As used in this case, "the week" means 7:00 AM Monday through
7:00 AM Saturday, with "the weekend" running from Saturday morning
to Monday morning. Thus, the two "weekend overnights" at issue in
this case comprise the early morning hours (12:30 AM to 6:30 AM) of
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bargaining agreement ("the Agreement") between the Hospital and the
union then representing the nurses4 was amended in November 1992 in
anticipation of this change and contains a section specifically
dealing with on-call. This section is at the root of the dispute
underlying this case. In relevant part, the section states:
§ 8.12, On-Call Pay. The Hospital reserves
the right to establish and disestablish on-
call in particular units when it determines
such is necessary. The Hospital will
determine, in its judgment, the number of
nurses needed to have a reasonable allocation
of on-call assignments. It will look first at
qualified volunteers and then assign the least
senior qualified nurses in the unit to fill
the number of on-call positions. Nurses who
are assigned to be on-call will be provided
with long-range beepers. All Post Anesthesia
Care Unit nurses (PACU), on a rotating basis,
will share on-call from 12:30 a.m. to 6:30
a.m., Tuesday through Saturday.
Similar language has remained in subsequent iterations of the
Agreement.
For approximately ten years after the switch from fully
staffed weeknight shifts to weeknight on-call, the Hospital used
the on-call system to staff the PACU unit with night nurses seven
nights a week. This practice continued without incident until
Sunday and Monday.
4
The Massachusetts Nurses Association moved to be substituted
for the original defendant, a local unit of the American Federation
of State, County, and Municipal Employees (AFSCME), after the
nurses voted to have the MNA replace the AFSCME as their collective
bargaining representative. References to "the Union" predating
2005 are to the AFSCME.
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2003, when a PACU nurse who was assigned to be on call on a weekend
night filed a grievance challenging the Hospital's authority to
assign nurses to on-call during weekend nights. She argued that
the last above-quoted sentence in § 8.12 of the Agreement, which
states that weeknight on-call duty is to be shared equally among
all PACU nurses, set forth the exclusive time and manner in which
PACU nurses could serve on call. In other words, she contended
that the sentence placed a limitation on the Hospital's authority
to "establish . . . on-call" as it sees fit.
The Hospital responded that the sentence in question was
not a limitation on when PACU nurses could be assigned on-call but
rather a modification of how nurses would be chosen for on-call
duty on weekday nights under the new arrangement. Since the first
part of § 8.12 specifies that, generally speaking, nurses will be
selected for on-call by volunteers and then in reverse order of
seniority, the second part, the Hospital contended, simply laid out
a different method for selecting nurses to serve on call during
weekday nights. The Hospital's proffered reason for the different
method was that weeknight on-call was a replacement for the fully
staffed weeknight shifts that had been in place until 1993, and
that the Hospital and the Union had agreed to distribute those
shifts equally among all PACU nurses rather than assign them solely
to volunteers and to the most junior nurses.
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The aggrieved nurse followed the grievance procedure laid
out in the Agreement and the Union and the Hospital eventually
proceeded to arbitration.
B. The Arbitration
The parties' collective bargaining agreement includes a
comprehensive dispute resolution procedure. One provision spells
out the function and authority — including limits thereon — of the
arbitrator selected to resolve a dispute. The provision makes
clear that the Agreement grants an arbitrator the authority to
interfere with a decision made by the Hospital only in very limited
circumstances.
§ 6.4, Arbitrator's Function and Authority.
The function of the arbitrator is to determine
the interpretation and application of the
specific provisions of this Agreement to the
grievance. . . . No arbitrator shall have any
authority or power to reverse, set aside or
modify any determination made by the Hospital
pursuant to the provisions of this Agreement
unless he or she finds that such determination
was arbitrary or capricious, without any
reasonable basis or in contravention of
express language of this Agreement which is
not subject to interpretation.
In accordance with these restrictions, the arbitrator in this case
recognized that she had the authority to put a stop to the
Hospital's practice of assigning weekend on-call only if that
practice either (a) was arbitrary and capricious or (b) contravened
express language in the Agreement that was not subject to
interpretation; that is, unambiguous language. Accordingly, she
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made explicit findings about whether the two prongs were met. She
first concluded that the Hospital's decision to assign nurses to
weekend on-call was not arbitrary or capricious; to the contrary,
she found the decision very reasonably grounded in patient safety
concerns. She went on to find, however, that the practice of
giving on-call assignments for weekend nights contravened express,
unambiguous language in the Agreement. She concluded that she
therefore had the authority under § 6.4 to set the Hospital's
decision aside.
The arbitrator's decision rested on her determination
that the fifth sentence in § 8.12 had only one possible meaning.
She stated,
The fifth sentence of [§ 8.12] plainly defines
a limited time period during which PACU nurses
can be assigned on-call. It specifically
states that the only time PACU nurses can be
assigned to on-call is weekday nights. This
provision is not subject to interpretation,
because any proffered interpretation that
would expand the instances in which PACU
[nurses] can be required to go on-call would
render the provision meaningless and
unnecessary.
The arbitrator accordingly concluded that the Hospital had violated
the Agreement by requiring PACU nurses to serve on call at times
other than weekday nights. As a remedy, she ordered the Hospital
to cease assigning any PACU nurses to on-call duty on weekend
nights.
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C. The District Court Decision
The Hospital brought an action under § 301 of the Labor
Management Relations Act, 29 U.S.C. § 185, to vacate the
arbitration award. It argued that the arbitrator had exceeded her
authority by ignoring the plain language of the Agreement and
resting her award on palpably faulty reasoning. The Hospital
contended that it was simply irrational for the arbitrator to
conclude that the fifth sentence of § 8.12 would be meaningless
unless interpreted to prohibit weekend night on-call. Rather, the
Hospital argued, that sentence makes perfect sense as a way of
changing the method by which nurses would be selected for on-call
duty on weekday nights.
The district court found that the arbitrator had
construed the Agreement in a way that completely transformed the
meaning of § 8.12 and created a work rule never contemplated or
bargained for by the parties. It further held that the arbitrator
had exceeded the limited authority given her by § 6.4 by
interfering with a Hospital decision without first finding that the
decision was arbitrary or capricious. Accordingly, the court
granted the Hospital's motion for summary judgment and vacated the
arbitral award. The Union now appeals.
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II. Analysis
A. Standard of Review
We review the district court's grant of summary judgment
de novo, Cytyc Corp. v. Deka Prods. Ltd. P'ship, 439 F.3d 27, 32
(1st Cir. 2006), applying the same standard as did the district
court. The hallmark of federal court review of an arbitrator's
decision is extreme deference to the opinion of the arbitrator,
whose interpretation of the contract has been bargained for by the
parties to the arbitration agreement. See United Paperworkers
Int'l Union v. Misco, Inc., 484 U.S. 29, 37-38 (1987); Cytyc, 439
F.3d at 32-33. "[J]udicial review of an arbitration decision is
extremely narrow and extraordinarily deferential [and] 'is among
the narrowest known in the law.'" Providence Journal Co. v.
Providence Newspaper Guild, 271 F.3d 16, 20 (1st Cir. 2001)
(quoting Maine Centr. R.R. Co. v. Bhd. of Maintenance of Way
Employees, 873 F.2d 425, 428 (1st Cir. 1989)). If an arbitration
award rests on a plausible interpretation of the underlying
contract, we must uphold it. See id. at 21 (upholding arbitrator's
decision because it was "a plausible, if not reasonable,
interpretation of the collective bargaining agreement"); Labor
Relations Div. of Constr. Indus. of Mass. v. Int'l Bhd. of
Teamsters, 29 F.3d 742, 746-47 (1st Cir. 1994) (same).
Nonetheless, an arbitrator's decision is not entirely
impervious to judicial oversight. In very limited circumstances,
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a party may succeed in challenging an arbitrator's interpretation
of an agreement. "[T]he paramount point to be remembered in labor
arbitration is that the power and authority of an arbitrator is
totally derived from the collective bargaining agreement and that
he violates his obligation to the parties if he substitutes 'his
own brand of industrial justice' for what has been agreed to by the
parties in that contract." Georgia-Pac. Corp. v. Local 27, United
Paperworkers Int'l Union, 864 F.2d 940, 944 (1st Cir. 1988)
(quoting United Steelworkers of Am. v. Enter. Wheel & Car Corp.,
363 U.S. 593, 597 (1960)). "Our task is to determine whether the
arbitrator exceeded his authority by failing to apply the contract
in a plausible manner." Labor Relations Div., 29 F.3d at 746.
B. Scope of the Arbitrator's Authority
The Agreement in this case grants arbitrators only narrow
authority to overrule determinations made by the Hospital, allowing
an arbitrator to interfere only if "he or she finds that [a]
determination was arbitrary or capricious, without any reasonable
basis or in contravention of express language of this Agreement
which is not subject to interpretation." The arbitrator here
determined that the language in § 8.12 was not subject to
interpretation and consequently found she had the authority to set
aside a Hospital policy that contravened that language.5 It is
5
The district court appeared to believe that § 6.4 sets out a
conjunctive requirement, i.e., that the Hospital's decision be both
arbitrary or capricious and in contravention of unambiguous
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this threshold determination, rather than the arbitrator's later
decision on the merits that the Agreement prohibited assigning PACU
nurses to weekend night on-call duty, that we review. We do so by
asking whether the arbitrator had a plausible basis for her
determination. In making this assessment, we keep in mind the
Supreme Court's repeated admonitions that courts may never
substitute their own views of the merits of a particular case for
the views of the arbitrator. See, e.g., Major League Baseball
Players Ass'n v. Garvey, 532 U.S. 504, 511 (2001); Misco, 484 U.S.
at 36. We also take into account, in this particular case, the
very narrow scope of authority granted to the arbitrator by the
Agreement in the first place. Cf. Nat'l Cas. Co. v. First State
Ins. Group, 430 F.3d 492, 497-98 (1st Cir. 2005) (noting that the
dissatisfied party "will have great difficulty" showing prejudice
from arbitral process where contract contained "broad" clause that
"fully sign[ed] over to the arbitrators the power to run the
dispute resolution process unrestrained by the strict bounds of law
or of judicial process").
contractual language before the arbitrator can intervene. The
arbitrator, in contrast, evidently found the word "or" to create a
disjunctive requirement; i.e., an arbitrator is not empowered to
modify a Hospital decision unless the decision (a) is arbitrary or
capricious or without any reasonable basis, or (b) contravenes
express, unambiguous language in the Agreement. The arbitrator's
view is a plausible interpretation of contractual language that
would admittedly have benefitted from more careful placement of
commas. In any event, the arbitrator herself found that the first
prong was not met, and we conclude the second prong was not met
either.
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In her decision, the arbitrator reasoned that the
relevant language in § 8.12, the fifth sentence, is "express"
because it "plainly defines a limited time period during which PACU
nurses can be assigned on-call" and "specifically states that the
only time PACU nurses can be assigned to on-call is weekday
nights." She went on to conclude that the language was "not
subject to interpretation" because any other interpretation besides
the one just stated "would render the provision meaningless and
unnecessary." However, the Hospital has put forth an entirely
logical and rational interpretation that belies the arbitrator's
insistence that only her interpretation makes sense. The
Hospital's explanation is that the fifth sentence of § 8.12
describes an alternative method for assigning PACU nurses to on-
call duty on weekday nights: on weekend nights, PACU nurses will
continue to be chosen for on-call using the general, Hospital-wide
method of first taking volunteers and then selecting the most
junior nurses; but on weekday nights in the PACU unit, all PACU
nurses will share on-call duty equally, since weeknight on-call is
a replacement for the old, fully staffed PACU weeknight shifts.
That the Hospital's explanation seems eminently
reasonable to us would be irrelevant if we were reviewing the
arbitrator's decision that her interpretation of § 8.12 was the
best possible interpretation. "[I]nterpretation of the collective
bargaining agreement is a question for the arbitrator. It is the
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arbitrator's construction which was bargained for; and so far as
the arbitrator's decision concerns construction of the contract,
the courts have no business overruling him because their
interpretation of the contract is different from his." Enter.
Wheel & Car, 363 U.S. at 599. The question before us, however, is
not the plausibility of the arbitrator's view as to the meaning of
§ 8.12, but rather the plausibility of her assertion that § 8.12 is
not subject to interpretation at all. In this context, the
presence of a logical, rational alternative explanation of the
meaning of § 8.12 is highly relevant, because it indicates that
there is more than one reasonable way of looking at § 8.12 and,
therefore, that the provision is subject to interpretation. The
reasonableness of the Hospital's interpretation is bolstered by the
fact that PACU nurses served on call on weekend nights as a matter
of course for at least ten years preceding this dispute. Cf.
Providence Journal Co., 271 F.3d at 21 (arbitrators are allowed to
use the parties' past practice "as an interpretive device or as
relevant evidence").
We conclude it was not plausible for the arbitrator to
find the fifth sentence of § 8.12 not subject to interpretation.
She therefore had no authority under the collective bargaining
agreement to overturn the Hospital's weekend on-call assignment
policy on the ground that it contravened that language in § 8.12.
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Accordingly, her decision cannot stand and her award must be
vacated.
III. Conclusion
It is rare for a court to disturb the result of a dispute
resolution process that has been duly bargained for by the parties.
"Nevertheless, acknowledging that our role is a limited one is not
the equivalent of granting limitless power to the arbitrator."
Poland Spring Corp. v. United Food and Commercial Workers Int'l
Union, 314 F.3d 29, 33 (1st Cir. 2002) (citing Georgia-Pac., 864
F.2d at 944). It is well established that arbitrators cannot
exceed the authority given to them by the underlying contractual
agreement, and that is what the arbitrator did here.
The opinion of the district court vacating the
arbitrator's award is affirmed.
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