Clear Channel Outdoor v. International Unions of Painte

In the

United States Court of Appeals
For the Seventh Circuit

No. 07-2609

C LEAR C HANNEL O UTDOOR, INC.,
Plaintiff-Appellant,
v.

INTERNATIONAL U NIONS OF P AINTERS
AND A LLIED T RADES, L OCAL 770,
Defendant-Appellee.

Appeal from the United States District Court
for the Eastern District of Wisconsin.
No. 04 C 30—Charles N. Clevert, Jr., Judge.

A RGUED F EBRUARY 25, 2008—D ECIDED M ARCH 12, 2009

Before R OVNER, W OOD , and W ILLIAMS, Circuit Judges.
R OVNER, Circuit Judge. After an arbitrator overturned
the decision of Clear Channel Outdoor, Inc. (“Clear Chan-
nel”) to discharge one of its employees for a workplace
safety violation, Clear Channel brought suit to vacate
the arbitrator’s award. See 29 U.S.C. § 185(a). The district
court instead confirmed the arbitrator’s decision, con-
cluding that the arbitrator had acted within his authority
2 No. 07-2609

to interpret the collective bargaining agreement between
Clear Channel and its unionized workforce. Clear Channel
Outdoor, Inc. v. Int’l Unions of Painters & Allied Trades,
Local Union 770, 2007 WL 1655438 (E.D. Wis. June 6,
2007). We affirm.

I.
Clear Channel Outdoor, which bills itself as the world’s
largest outdoor advertising company, owns and main-
tains approximately 1,500 billboards in and around Mil-
waukee, Wisconsin. Local 770 of the International Union of
Painters and Allied Trades, AFL-CIO represents the
painters and construction workers who work on Clear
Channel’s Milwaukee-area billboards. As of his discharge
in 2003, Patrick Rogney had worked for the Milwaukee
Divison of Clear Channel and its predecessor, Eller Me-
dia/Milwaukee, for twenty-two years and had been a
crew chief for the last ten of those years. Rogney is a
member of Local 770 and has served as a union steward
and held other offices within the union.
Safety rules promulgated by the Occupational Safety and
Health Administration (“OSHA”) require a billboard
worker like Rogney to wear a body harness when
working six feet or more off the ground. See 29 C.F.R.
§ 1926.501(b)(1). The harness has a lanyard that connects
to a wire spanning the length of the billboard, thus pre-
venting the worker from falling to the ground in the
event he slips off the billboard platform. In 2002, a co-
worker of Rogney’s fell to his death after he failed to
No. 07-2609 3

attach his safety harness to the safety cable of the bill-
board he was working on.
Clear Channel (as the successor to Eller Me-
dia/Milwaukee) and Local 770 were parties to a collective
bargaining agreement dated June 1, 2001 (the “CBA”).
The following CBA provisions (which refer to Local 770
as “the Union” and Clear Channel as “the Employer” and
“the Company”) are relevant to this appeal:
ARTICLE VI
DISCIPLINE AND DISCHARGE
Section 1: The Union recognizes and acknowledges
that the Employer has the duty of main-
taining good discipline among its Employ-
ees because the Employer is responsible
for the efficient operation of its businesses.
Section 2: The Employer shall have the right to discipline
and/or discharge Employees for just cause.
Section 3: In the case of any offense for which an Em-
ployee may be discharged, the Employer may,
in its sole discretion, impose a lesser penalty.
Section 4: The following shall constitute causes for dis-
charge or other disciplinary action, and their
enumeration here is by way of illustration
and shall not be deemed to exclude or
restrict the Employer’s right to discharge
Employees for any other just cause.
***
4 No. 07-2609

b. Violation of Employer rules and safety rules.
***
ARTICLE VII
GRIEVANCE PROCEDURE
Section 1: A grievance is defined as a claim or dis-
pute with the Company by an Employee or
Employees, including an alleged violation
by the Company, of the terms of this
Agreement. . . . The Employer and the
Union agree that they will settle all griev-
ances that may arise regarding the inter-
pretation or application of any of the
terms of this Agreement in the following
manner:
***
c. . . . [T]he Union may submit the grievance
to arbitration for final disposition by giving
written notice to the Employer of its desire
to arbitrate. . . . The parties shall attempt to
select a mutually agreeable arbitrator . . . .
. . . The arbitrator shall interpret and apply
this Agreement in an effort to settle this
dispute but the arbitrator shall have no power
to add to, subtract from, or otherwise modify
the terms of this Agreement, and the arbitra-
tor’s decision shall be final and binding on the
parties to the Agreement, and the employee
involved. . . .
***
No. 07-2609 5

ARTICLE XIV
SAFETY AND HEALTH
Section 1: When protective devices and other safety
equipment are required by OSHA and/or
the Employer, their use by Employees is
mandatory.
Section 2: Safety requirements of OSHA and the
Employer must be complied with and
safety equipment as furnished by the Com-
pany must be used or reprimand steps
as follows will be in effect:
1st Offense - Written reprimand shall be
given to the Employer and a copy sent
to the Union local.
2nd Offense - Five (5) days suspension
without pay.
3rd Offense - Discharge for cause.
Section 3: If any Employee fails to use, in the manner
prescribed by OSHA and/or the Employer,
safety belt and/or harness and/or safety line
equipment, which is provided and the use of
which is required by OSHA and/or the Em-
ployer, the Union, and the Employee agree
that this is a safety offense of such serious
matter that the Employer shall proceed directly
to the discipline step as set forth above as “3rd
Offense” and the Employee may be immedi-
ately discharged.
***
6 No. 07-2609

R. 17 Joint Ex. 1 (Emphasis ours.)
Clear Channel required its billboard workers to
undergo safety training on an annual basis. Rogney
participated in such a training session on July 23, 2002. At
the conclusion of that training, he signed a “Personal
Fall Protection Equipment” statement acknowledging
that he had been instructed in the use and care of fall
arrest systems and equipment and certifying that
“I understand the use of the body harness and other
personal fall arrest equipment is mandatory and is to be
used in the manner prescribed by OSHA and/or the
Company.” R. 17 Employer Ex. 5. Rogney also signed a
separate statement containing the following acknowledg-
ment:
Further, I have been trained in the use of the de-
scribed personal fall protection equipment and under-
stand that improper use or not using prescribed
equipment in a safety-sensitive environment will be
grounds for immediate termination of employment.
R. 17 Employer Ex. 6.
On April 2, 2003, Rogney was working with a crew on
a Clear Channel billboard located at the intersection of
Capital Drive and Green Bay Avenue in Milwaukee. The
platform on which the employees were working was
eighteen or more feet above the ground. Rogney was
wearing a full-body safety harness, and initially his
harness was connected to the billboard’s safety cable.
However, at some point, as Rogney stepped around one
of his co-workers, he unhooked the lanyard from the
cable and then neglected to reattach it.
No. 07-2609 7

While Rogney was working with his lanyard discon-
nected from the safety cable, a company official
happened to drive by. Paul Sara, president of Clear Chan-
nel’s Milwaukee Division, was performing a periodic
inspection of some of Clear Channel’s billboards—which
he calls “driving the plant.” As he approached the
Capitol Drive billboard, he saw the crew working on that
billboard and noticed that two of the workers did not
have their lanyards connected to the billboard’s safety
cable. He stopped to get a closer look and observed
the crew for a period of about eight minutes. Sara did not
call the safety violation to the workers’ attention.
Instead, he telephoned the company’s operations man-
ager, Rick Schoenholtz, and told Schoenholtz what he had
seen. Sara expressed his displeasure, noting that the
employees’ omission was an “unacceptable” violation of
Clear Channel’s policies; Schoenholtz agreed.
Schoenholtz and supervisor Tom Riley met with Rogney
later that day and told him what Sara had seen. At no time
did Rogney dispute that he had violated the company’s
safety rules by working on the billboard with his lanyard
unhooked. Rogney was immediately suspended pending
further investigation, as was the other employee seen
working without his lanyard attached to the safety cable.
Two days later, the company discharged them both.
Local 770 subsequently filed a grievance protesting
Rogney’s discharge, contending that he had been fired
without good cause. The parties selected a mutually
acceptable arbitrator, Fredric R. Dichter, and, by agree-
ment, submitted the following questions for his decision:
8 No. 07-2609

“Did the Employer have just cause to discharge the
Grievant [Rogney]? If not, what is the appropriate rem-
edy.” See R. 1 Ex. 4 at 1. The arbitrator conducted an
evidentiary hearing on September 10, 2003, after which
the parties submitted written briefs. Three months later,
the arbitrator rendered a written decision and award.
Arbitrator Dichter determined that Rogney’s discharge
was without just cause and that a six-month suspension
without pay was an appropriate penalty. He read Article
XIV’s provision that an employee may be discharged for
committing the type of safety violation that Rogney did,
together with Article VI’s provision that the employer
may only discharge an employee for “just cause,” to
mean that Clear Channel’s discretion to discharge an
employee was limited. R. 1 Ex. 4 at 7-8. Just cause, as
the arbitrator interpreted that term, required Clear Chan-
nel to consider not only whether the employee com-
mitted an offense for which the agreement permits dis-
charge, but also whether the particular transgression
warranted discharge. Id. at 8. It was the arbitrator’s role, in
turn, to assess de novo whether the circumstances ren-
dered discharge too harsh a penalty, and in Arbitrator
Dichter’s view, it was in Rogney’s case. Id. at 8-9. Al-
though the arbitrator conceded that Rogney’s trans-
gression was a serious offense that could have had “disas-
trous” consequences, he had a “very hard time under-
standing” how a member of Clear Channel’s management
could stand by watching Rogney and his co-worker
laboring in an unsafe manner for a period of eight
minutes without doing anything to intervene. Id. at 11.
“To sustain the discharge under these circumstances
No. 07-2609 9

would be asking the Arbitrator to treat the offense
more seriously than the Employer did at the time the
offense was actually being committed.” Id. In view of
Rogney’s perfect prior record, his long tenure with the
company, the fact that he was wearing his safety harness
and had the lanyard connected to the safety wire earlier,
coupled with Clear Channel’s inaction, discharge was
too severe a penalty, in the arbitrator’s view; the com-
pany therefore lacked just cause to fire Rogney. Id. It
did, however, have just cause to impose “stern[ ] disci-
pline.” Id. at 12. As of the date of the decision, Rogney
had been out of the company’s employ for more than
eight months. The arbitrator believed that a six-month
suspension without pay was an adequate penalty. Id. He
ordered Rogney reinstated subject to that penalty and
directed Clear Channel to make Rogney whole for the
balance of two and one-half months that Rogney had
been separated from its employ.
The district court denied Clear Channel’s motion to
vacate the award and granted the union’s motion to
confirm it. 2007 WL 1655438. The court noted at
the outset that the question before it was whether the
arbitrator interpreted the collective bargaining agree-
ment, not whether he did so erroneously. Id. at *6.
Having reviewed the arbitrator’s decision, the court was
satisfied that the arbitrator did indeed interpret the
parties’ agreement. “Regardless of whether his inter-
pretation was strained or even a serious error, the award
must stand. Id. The court rejected Clear Channel’s sug-
gestion that the decision was contrary to public policy.
The relevant consideration in that regard was “not
10 No. 07-2609

whether the employee’s failure to wear the harness vio-
lates public policy but whether the order to reinstate
does.” Id. at *7. The court recognized that there is a
strong federal interest in workplace safety, but reasoned
that a six-month suspension does not necessarily con-
done a worker’s failure to comply with safety rules. Id.

II.
As is common in collective bargaining agreements,
Article VII of the agreement between Local 770 and
Clear Channel sets forth a grievance procedure to
resolve disputes between the company and its em-
ployees which provides for binding arbitration of any
grievance that the company and the union are unable to
settle. Speaking to the arbitrator’s authority, the agree-
ment provides that “[t]he arbitrator shall interpret and
apply this Agreement in an effort to settle this dispute
but the arbitrator shall have no power to add to, subtract
from, or otherwise modify the terms of this Agreement
and the arbitrator’s decision shall be final and binding
on the parties to the Agreement and the Employee in-
volved.” Article VII, § 1(c).
Courts play a “very limited” role in reviewing a labor
arbitrator’s decision. Major League Baseball Players Ass’n
v. Garvey, 532 U.S. 504, 509, 121 S. Ct. 1724, 1728 (2001)
(per curiam). We do not review the merits of the decision.
Ibid; United Paperworkers Int’l Union v. Misco, Inc., 484
U.S. 29, 36-38, 108 S. Ct. 364, 370-71 (1987); United
Steelworkers of Am. v. Enterprise Wheel & Car Corp., 363
U.S. 593, 596, 80 S. Ct. 1358, 1360 (1960). To do so would
No. 07-2609 11

upset the bargain that the parties struck to have their
agreement construed by an arbitrator rather than a court
and in the process undermine the federal policy of resolv-
ing labor disputes privately. Misco, 484 U.S. at 36-38, 108
S. Ct. at 370-71; Enterprise Wheel & Car, 363 U.S. at 599, 80
S. Ct. at 1362. “Our review is . . . limited to deter-
mining whether the arbitrator ‘exceeded the powers
delegated to him by the parties,’ i.e., whether he failed to
arbitrate the dispute in accord with the agreement.” Arch
of Ill., Div. of Apogee Coal Corp. v. Dist. 12, United Mine
Workers of Am., 85 F.3d 1289, 1292 (7th Cir. 1996) (quoting
Ethyl Corp. v. United Steelworkers of Am., 768 F.2d 180,
184 (7th Cir. 1985)).
Whether we believe the arbitrator’s decision to be right
or wrong is immaterial; what matters is whether the
arbitrator’s decision was animated by the collective
bargaining agreement. Garvey, 532 U.S. at 509-10, 121 S. Ct.
at 1728-29; Int’l Union of Operating Eng’rs, Local 139 v. J.H.
Findorff & Son, Inc., 393 F.3d 742, 745 (7th Cir. 2004). “As
long as the arbitrator’s award ‘draws its essence from
the collective bargaining agreement,’ and is not merely
‘his own brand of industrial justice,’ the award is legiti-
mate.” Misco, 484 U.S. at 36, 108 S. Ct. at 370 (quoting
Enterprise Wheel & Car, 363 U.S. at 597, 80 S. Ct. at 1361).
A decision draws its essence from the collective bar-
gaining agreement when it has a plausible foundation in
the terms of the agreement. See Monee Nursery & Land-
scaping Co. v. Int’l Union of Operating Eng’rs, Local 150, 348
F.3d 671, 675 (7th Cir. 2003); Butler Mfg. Co. v. United
Steelworkers of Am., 336 F.3d 629, 633 (7th Cir. 2003); Jasper
Cabinet Co. v. United Steelworkers of Am., 77 F.3d 1025, 1028-
12 No. 07-2609

29 (7th Cir. 1996). We resolve doubts in that regard in
favor of enforcing the award. E.g., Am. Postal Workers
Union, Milwaukee Local v. Runyon, 185 F.3d 832, 835 (7th
Cir. 1999); see also Enterprise Wheel & Car, 363 U.S. at 597-
98, 80 S. Ct. at 1361. “It is only when the arbitrator must
have based his award on some body of thought, or
feeling, or policy, or law that is outside the contract . . . that
the award can be said not to ‘draw its essence from the
collective bargaining agreement.’ ” Arch of Ill. 85 F.3d at
1292 (quoting Ethyl Corp., 768 F.2d at 184-85) (emphasis
in Arch of Ill.); Polk Bros., Inc. v. Chicago Truck Drivers
Union, 973 F.2d 593, 597 (7th Cir. 1992)); see also Chicago
Typographical Union No. 16 v. Chicago Sun-Times, Inc., 935
F.2d 1501, 1506 (7th Cir. 1991) (“a noncontractual basis
can be inferred and the award set aside” when “there is
no possible interpretive route to the award”).
Here the arbitrator without question was interpreting
the agreement. The arbitrator understood that it was
his task to construe the provisions of the collective bar-
gaining agreement and to apply those provisions to
the facts presented to him. R. 1 Ex. 4 at 8. He included in
full the relevant provisions of the agreement in the back-
ground set forth at the outset of his opinion. Id. at 3-4.
His ensuing analysis was grounded in those provisions.
The arbitrator deemed the permissive language found in
Article XIV, section 3 regarding Clear Channel’s power
to discharge an employee particularly important:
whereas Article VI, Section 3 purports to grant to the
employer the sole discretion to impose a lesser penalty
for an offense that subjects an employee to immediate
discharge, Article XIV, Section 3 states that an employee
No. 07-2609 13

“may be immediately discharged” for failing to use a
safety belt and/or harness in the manner prescribed by
OSHA and the employer. The latter provision’s “use of
the word ‘may’ implies that in certain circumstances a
lesser penalty would be appropriate.” Id. at 7-8. By
leaving the door open to a lesser penalty, the arbitrator
believed, the agreement imposed on the employer the
obligation to exercise its discretion in determining
which penalty to impose “within the confines of the
remainder of the Agreement.” Id. at 8. Elsewhere in the
agreement, the parties had agreed that no employee was
to be discharged without just cause, and “[j]ust cause, as
the Union notes, is not limited to a determination of
whether the employee did the act, but also includes a
determination as to whether the act warranted the
most serious penalty that can be imposed in the
industrial setting, discharge.” Id. Furthermore, the
parties had granted the arbitrator the authority to inter-
pret and apply the agreement, and the existence (or not)
of just cause was an issue that arbitrators regularly
deal with. Id. Thus, although the arbitrator acknowl-
edged that the contract grants to the employer the power
to discharge an employee for failing to use his safety
harness, he understood the use of the permissive word
“may” in setting forth that power, coupled with the con-
tract’s no-discharge-without-just-cause provision, to
limit the exercise of that discretion and to subject the
employer’s choice of penalty to a kind of proportionality
review. Id. at 8-9. The arbitrator then proceeded to con-
sider the relevant facts, including the gravity of the
safety violation, Sara’s failure to do anything to correct
14 No. 07-2609

the violation while he was observing it take place, the
apparently inadvertent nature of the violation, Rogney’s
long tenure with the company, and his otherwise unblem-
ished record. Those facts persuaded the arbitrator that
just cause did not exist to support the decision to dis-
charge Rogney, although they did support a lesser
penalty of six months’ suspension without pay. Id. at 11-12.
The arbitrator’s decision thus drew its essence from the
collective bargaining agreement: It was tethered to the
language of the agreement, it set forth an arguable con-
struction of the agreement, and it applied that interpreta-
tion to the facts that the parties submitted. Cf. Jasper
Cabinet, 77 F.3d at 1029 (“[The arbitrator’s] examination
of the contract articles and her reliance on the specific
contract word ‘is’ in finding an implicit condition of
reasonable time was contract interpretation—plain and
simple.”). It is not possible for us to say that the decision
must have been based on something outside of the con-
tract, see Arch of Ill., 85 F.3d at 1292, or that there was no
possible interpretive route to the award, see Chicago Sun-
Times, 935 F.2d at 1506.
Nor is it possible for us to characterize the decision
as extra-contractual, as Clear Chanel would have us do,
on the ground that the arbitrator ignored a key provision
of the contract. See J.H. Findorff & Son, 393 F.3d at 745.
The company asserts that the arbitrator must have
turned a blind eye to Article VI, Section 4(b) of the col-
lective bargaining agreement, which cites a violation
of safety rules as a “cause[ ] for discharge or other disci-
plinary action.” Clear Channel views that provision as
No. 07-2609 15

irreconcilable with the notion that it lacked just cause to
discharge Rogney, whose violation of safety rules was
undisputed. Yet, the arbitrator did not ignore Article VI,
Section 4(b): He quoted the full text of that provision
along with the other relevant provisions of Article VI
and Article XIV at the outset of his decision. It is true
that the arbitrator did not mention this provision later
in his decision, when he compared the provisions of
Article VI and Article XIV and concluded that although
they granted the employer the discretion to discharge
an employee for failing to properly use his safety harness,
the exercise of that discretion was reviewable and could
be overturned if the arbitrator concluded that the cir-
cumstances did not warrant discharge as opposed to a
lesser penalty. But we think it highly unlikely that the
arbitrator’s analysis would have looked different, let
alone led to a different result, had he specifically ad-
verted to Article VI, Section 4(b) in his effort to con-
strue the two articles together. Section 4(b) expressly
recognizes a safety violation as cause for a discharge “or
other disciplinary action,” and as such recognizes, just as
Article XIV, Section 3 does, that an employer “may” opt
for a lesser penalty in lieu of discharge when an em-
ployee has committed a safety violation. We have no
reason to doubt that the arbitrator, had he returned to the
language of Article VI, Section 4(b) and addressed it
specifically, would have construed the discretion it con-
veyed on the employer to opt for a penalty other than
discharge in the same way he construed the parallel
language of Article XIV, Section 3. For all we know, that
is precisely what the arbitrator did, without saying so.
16 No. 07-2609

But the notion that he ignored this provision is untenable
given that he explicitly recognized the provision early on
in his decision. See Chicago Sun-Times, 935 F.2d at 1505-06.
What Clear Channel’s argument boils down to is that
the arbitrator’s decision is contrary to the plain meaning
of the contract; but this is simply another way of
arguing that the decision is wrong on the merits, and that
is precisely the type of argument that is beyond our
purview. It bears repeating that our task in reviewing
a labor arbitrator’s award is to ensure that the arbitrator
was interpreting the collective bargaining agreement,
not that he was doing so correctly. Garvey, 532 U.S. at 509-
10, 121 S. Ct. 1728; Dexter Axle Co. v. Int’l Ass’n of
Machinists & Aerospace Workers, Dist. 90, 418 F.3d 762,
770 (7th Cir. 2005). Even if we are convinced that the
arbitrator’s error in interpreting the parties’ agreement
was plain, we lack the authority to intervene. See Garvey,
532 U.S. at 509, 121 S. Ct. at 1728 (“if an arbitrator is
even arguably construing or applying the contract and
acting within the scope of his authority, the fact that a
court is convinced he committed serious error does not
suffice to overturn his decision”) (internal quotation
marks and citations omitted). We specifically rejected
such a contention in J.H. Findorff & Son:
If a gaffe authorized a court to set aside the award,
there would be little difference between arbitration
and litigation other than the extra cost and delay of
presenting the case to the arbitrator before taking it
to court. That would turn arbitration on its head; the
process is designed to achieve speed, lower cost, and
No. 07-2609 17

expertise. That can be accomplished only if courts
enforce intellectually honest arbitral decisions, even
if the court thinks the arbitrator’s decision mistaken.
It is why “the question for decision by a federal
court asked to set aside an arbitration award . . . is not
whether the arbitrator or arbitrators erred in inter-
preting the contract; it is not whether they clearly
erred in interpreting the contract; it is not whether
they grossly erred in interpreting the contract; it is
whether they interpreted the contract.” Hill v. Norfolk
& Western Ry., 814 F.2d 1192, 1194-95 (7th Cir. 1987).
The principle is the same whether or not the [court]
deems the agreement “clear”—a decision that can be
made only after the extended and costly process of
litigation that arbitration is supposed to avert. Under
Garvey and its predecessors, misinterpretation of
contractual language, no matter how “clear,” is within
the arbitrator’s powers; only a decision to ignore or
supersede language conceded to be binding allows
a court to vacate the award. There is a big differ-
ence—a clear difference, a plain difference—between
misunderstanding and ignoring contractual language.
393 F.3d at 745; see also Arch of Ill., 85 F.3d at 1292; Chicago
Sun-Times, 935 F.2d at 1505. The court added that al-
though the meaning of contractual terms may seem plain
to a court, they may not to an arbitrator with a back-
ground in the subject matter of the collective bargaining
agreement. “Arbitrators, often chosen because of their
expertise in the industry, may see nuances that escape
generalist judges.” J.H. Findorff & Son, 393 F.3d at 746.
18 No. 07-2609

In an effort to dispense with the burden of showing that
the arbitrator was not interpreting the contract, Clear
Channel relies on a line of cases from other circuits
holding that once an arbitrator finds that a violation
has occurred for which the contract language authorizes
discipline up to and including termination at the em-
ployer’s discretion, the arbitrator necessarily has found
just cause for discharge and generally may not review
the propriety of the employer’s decision to fire the of-
fending employee rather than imposing lesser discipline.
See Textile Workers Union of Am., Local Union No. 1386 v.
Am. Thread Co., 291 F.2d 894, 899-900 (4th Cir. 1961) (2-1
decision); see also, e.g., Poland Spring Corp. v. United Food
& Commercial Workers Int’l Union, Local 1445, 314 F.3d 29,
34-35 (1st Cir. 2002) (2-1 decision); Int’l Bhd. of Elec. Workers,
Local 175 v. Thomas & Betts Corp., 182 F.3d 469, 472 (6th
Cir. 1999); Butterkrust Bakeries v. Bakery, Confectionery, &
Tobacco Workers Int’l Union, Local 361, 726 F.2d 698, 700
(11th Cir. 1984) (2-1 decision); see also Am. Eagle Airlines,
Inc. v. Air Line Pilot’s Ass’n, 343 F.3d 401, 409-10 (5th Cir.
2003) (2-1 decision). But this circuit has never embraced
that line of authority. In Int’l Ass’n of Machinists, Dist. No.
8 v. Campbell Soup Co., 406 F.2d 1223, 1226 (7th Cir. 1969),
we distinguished the Fourth Circuit’s decision in
American Thread on two grounds, noting first that the
agreement at issue in American Thread expressly identi-
fied the ground on which the employee had been fired
as just cause for discharge and contained a clause barring
the arbitrator from making an award that changed, modi-
fied, or added to the agreement, and second that the
arbitrator in American Thread had expressly found the
No. 07-2609 19

existence of just cause to discharge the employee. Here, as
in American Thread, the contract cites the basis for Rogney’s
discharge as just cause and deprives the arbitrator of
the authority to modify the terms of the collective bar-
gaining agreement, so we cannot make that distinction.
But see Ethyl Corp., 768 F.2d at 185-86 (noting that con-
tract’s no-modification provision did not compel
arbitrator to adopt literal interpretation of contract or
preclude him from finding implied condition). But just as
in Campbell Soup, the arbitrator here concluded that, under
the terms of the contract, the employer lacked just cause
to fire the employee. The latter conclusion constitutes a
plausible interpretation and application of the agree-
ment, and brings this case into line with Campbell Soup. See
also IMC-Agrico Co. v. Int’l Chem. Workers Council of United
Food & Commercial Workers Union, 171 F.3d 1322, 1327-28
(11th Cir. 1999) (drawing same distinction). We note
further that Campbell Soup is hardly the only decision
in which we have sustained an arbitration award
directing the reinstatement of an employee notwithstand-
ing the fact that the employee had committed a trans-
gression for which the employer was authorized by the
contract to discharge the employee. See, e.g., Arch of Ill.,
85 F.3d at 1293-94; F.W. Woolworth Co. v. Misc. Warehouse-
men’s Union, Local No. 781, 629 F.2d 1204, 1215-16 (7th
Cir. 1980) (2-1 decision).
The arbitrator’s decision was not contrary to public
policy. As the district court observed, the relevant consid-
eration is not whether Rogney’s failure to use his safety
harness properly was contrary to the federal interest
in workplace safety, as manifested by the OSHA regula-
20 No. 07-2609

tion, but rather whether ordering him reinstated would
violate that interest. 2007 WL 1655438, at *7; see Eastern
Associated Coal Corp. v. United Mine Workers of Am., Dist.
17, 531 U.S. 57, 63, 121 S. Ct. 462, 467 (2000). Clear
Channel has cited nothing in the federal regulations that
forbids the reinstatement of an employee who has commit-
ted this type of safety violation. Rogney’s reinstatement
does not in any way force the company to violate federal
rules. And we cannot say that the reinstatement of a long-
term employee with an otherwise positive record after a
six-month suspension without pay—a rather substantial
penalty—jeopardizes Clear Channel’s ability to enforce
workplace safety rules or is otherwise irreconcilable with
the strong public policy interest in workplace safety. Id.
at 65-66, 121 S. Ct. at 468.
Finally, we reject Clear Channel’s contention that the
arbitrator lacked the authority to decide what penalty
was appropriate for Rogney’s safety violation. The
parties themselves agreed that in the event the
arbitrator concluded that the company lacked just cause
to terminate Rogney, he could determine what penalty
was appropriate. The parties did the same in Campbell
Soup, and we concluded that in doing so they had recog-
nized the authority of the arbitrator to adjust the penalty
that the employer had imposed: “We think it is clear
from the issue submitted to the arbitrator that he was
faithful to his obligation and substantially followed the
Supreme Court guidelines in Enterprise.” 406 F.2d at 1225.
See also F.W. Woolworth, 629 F.2d at 1216.
All this is not to say that we necessarily agree with the
arbitrator’s construction of the contract, which gave
No. 07-2609 21

Clear Channel the discretion to fire an employee for
violating a safety rule and cited such a violation as just
cause justifying a discharge. But it was not our construc-
tion of the contract for which the parties bargained.
They agreed to have an arbitrator interpret their agree-
ment. And because the arbitrator’s decision drew its
essence from the agreement, we are obliged to uphold
the arbitrator’s award.

III.
The arbitrator acted within his authority to interpret
and apply the contract in concluding that Clear Channel
lacked just cause to discharge Rogney and in ordering
him reinstated subject to a six-month suspension
without pay. The district court therefore properly denied
Clear Channel’s request to overturn the arbitrator’s
award and granted the Union’s request to confirm it.
Although Clear Channel has not prevailed in its appeal,
we do not find the appeal frivolous and therefore deny
Local 770’s request for sanctions pursuant to Federal
Rule of Appellate Procedure 38.
A FFIRMED.

3-12-09