United States Court of Appeals
For the First Circuit
No. 18-2263
STEWARD HOLY FAMILY HOSPITAL, INC.,
Plaintiff, Appellee,
v.
MASSACHUSETTS NURSES ASSOCIATION,
Defendant, Appellant.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Nathaniel M. Gorton, U.S. District Judge]
Before
Torruella, Lynch, and Kayatta,
Circuit Judges.
James F. Lamond, with whom Allison J. Zimmon and McDonald
Lamond Canzoneri were on brief, for appellant.
Joshua D. Nadreau, with whom Joseph W. Ambash and Fisher &
Phillips, LLP were on brief, for appellee.
August 1, 2019
KAYATTA, Circuit Judge. After Maureen Bean grabbed the
face of a colleague at work, the Steward Holy Family Hospital ("the
Hospital") terminated her employment as a nurse in the medical-
surgical unit. Bean's union, the Massachusetts Nurses Association
("the Union"), then initiated grievance procedures against the
Hospital, arguing that there was not just cause for her termination
under the parties' collective bargaining agreement (CBA). The
parties submitted the dispute to an arbitrator. After establishing
that Bean had engaged in misconduct providing just cause for
discipline, the arbitrator concluded that Bean's termination was
nevertheless unwarranted and ordered that she be reinstated with
backpay. The Hospital initiated this action to vacate the
arbitrator's award, asserting that the arbitrator exceeded his
authority under the parties' CBA. The U.S. District Court for the
District of Massachusetts agreed and entered summary judgment for
the Hospital. We now reverse.
I.
Both parties accept the general proposition that "an
arbitrator's factual findings are not open to judicial challenge."
El Dorado Tech. Servs., Inc. v. Union Gen. de Trabajadores, 961
F.2d 317, 320 (1st Cir. 1992). So, we summarize the facts as they
are presented in the arbitrator's opinion.
This case arose out of confusion surrounding the
granting of vacation requests by nurses within the medical-
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surgical unit of the Hospital. Chris Ouellet, the supervising
nurse in that unit, maintained a policy of resolving competing
vacation requests based on seniority. In January 2016, Ouellet
received vacation requests for the first week of March from Bean,
two more senior nurses, and a junior nurse, Nancy Waterhouse.
Ouellet denied Bean's request but instead offered her the second
week in March, which Bean accepted. Upon inspecting the vacation
calendar in the nurses' break room, Bean discerned that Waterhouse
-- who had submitted an earlier request and had already paid a
deposit on a vacation rental -- had received approval from Ouellet
to take off the first week in March.
Not pleased with this turn of events, Bean called
Waterhouse's home numerous times, leaving multiple voicemails and
requesting that Waterhouse return her calls before the two briefly
"discuss[ed] the vacation situation without rancor." The
following weekend, Bean called and left messages for Waterhouse on
Friday, Saturday, and Sunday to inform her of an upcoming union
meeting that had been calendared to discuss problems related to
scheduling vacations. Waterhouse did not return Bean's calls.
Then, while Waterhouse and Bean were both clocking into work the
following Tuesday, Bean confronted Waterhouse about her unreturned
calls, squeezed Waterhouse's cheek, and, "talking like a baby,
asked if everything worked out with her vacation." Waterhouse
angrily told Bean to "worry about [her] own vacation." Later that
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day, Bean came up behind Waterhouse, ran a finger along her back,
and said, "I didn't mean to upset you back there. We need to do
something about this vacation policy." Waterhouse responded that
she agreed that something needed to be done about the vacation
policy but that she did not appreciate the phone calls or Bean's
grabbing her by the face.
Ten days later, Waterhouse reported the incident to the
Hospital's Human Resources Department. This was not the first
time that Bean's coworkers had reported her for misconduct. Four
years earlier, Ouellet counseled Bean after she "angrily pulled
the ponytail of a colleague." Ouellet again counseled Bean after
she reportedly "demeaned a student nurse and offended [the resident
nurse]." And just one week before the altercation with Waterhouse,
Ouellet gave Bean a verbal warning for "profanely defying
[Ouellet's] directive." Following an investigation into
Waterhouse's allegations, the Hospital terminated Bean. It based
the termination solely on its conclusion that Bean had indeed
grabbed Waterhouse by the face -- an act that the Hospital deemed
an "assault." The Union then initiated grievance proceedings
against the Hospital on Bean's behalf, arguing that Bean was not
guilty of misconduct and, alternatively, that termination was a
disproportionate response to Bean's alleged wrongdoing.
The CBA provides for the use of arbitration to resolve
formal grievances related to the Hospital's "interpretation,
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application, or enforcement" of the CBA. Significantly, however,
the arbitrator's authority to resolve grievances arising under the
CBA is not plenary under the terms of the CBA. The text of the
CBA as it bears on the scope of that authority is as follows:
Article V, Management Rights
o Section 1: "Except to the extent expressly limited by
this Agreement, the Hospital retains the exclusive
right . . . to discipline and discharge Employees for
just cause . . . [and] to issue, amend and enforce
reasonable work rules and policies not inconsistent with
the provisions of this Agreement."
Article X, Grievance and Arbitration
o Section 5: "The Arbitrator's authority shall be limited
to the interpretation and application of the parties'
Agreement. No arbitrator shall have the authority to
add to, subtract from, or modify the Agreement in any
respect, or to substitute his/her discretion or judgment
for that of the Hospital."
Article XXXIII, Discipline and Discharge
o Section 1: "A Nurse who has completed his/her
probationary period and has acquired seniority under
this Agreement shall not be suspended, discharged,
demoted or otherwise disciplined except for just cause.
Discipline may include, but is not limited to,
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counseling, verbal warnings, written warnings,
suspension and/or termination. The Hospital may utilize
whatever level of discipline it believes is appropriate
depending on the circumstances, but it will make
reasonable efforts to utilize progressive discipline."
Appendix G
o "All existent policies applicable to bargaining unit
employees are hereby included in this CBA by reference,
except to the extent that the express terms of this
collective bargaining agreement supersede any
contradictory provision of an existing policy."
The parties submitted the following issues to the
arbitrator for resolution: "Was the termination of Maureen Bean
for just cause? . . . If not, what shall be the remedy?" Rejecting
Bean's denial that she had grabbed Waterhouse, the arbitrator
concluded that Bean had engaged in an inappropriate, unconsented
touching "for which there was just cause to impose discipline."
Nevertheless, he then found that Bean's conduct did not warrant
"termination in the first instance, without progressive
discipline." Accordingly, the arbitrator directed the Hospital to
reduce its penalty to a written warning and to reinstate Bean with
backpay.
The Hospital filed suit, arguing that the arbitrator
exceeded the scope of his authority under the CBA in vacating the
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Hospital's decision to terminate Bean and in ordering her
reinstatement. The district court entered summary judgment for
the Hospital, see Steward Holy Family Hosp., Inc. v. Mass. Nurses
Ass'n, 350 F. Supp. 3d 7, 16 (D. Mass. 2018), and this appeal
followed.
II.
"In order to assess whether the arbitrator exceeded his
contractual authority to resolve the parties' dispute, we look
first at the specific provisions of the CBA and the agreement to
arbitrate it contains." Butler Mfg. Co. v. United Steelworkers,
336 F.3d 629, 633 (7th Cir. 2003). Additionally, "an arbitrator's
authority under the CBA may be supplemented by the parties'
submissions." Dorado Beach Hotel Corp. v. Union de Trabajadores
de la Industria Gastronomica de P.R. Local 610, 959 F.2d 2, 4 (1st
Cir. 1992); see also Butler Mfg. Co., 336 F.3d at 633 ("[W]e may
also consult the parties' submissions . . . to see if there was a
post-dispute agreement to submit additional questions to the
arbitrator.").
We have labelled the degree of deference that we afford
an arbitrator's interpretation of the governing arbitration
agreement as "extreme." Salem Hosp. v. Mass. Nurses Ass'n, 449
F.3d 234, 237 (1st Cir. 2006). "If an arbitration award rests on
a plausible interpretation of the underlying contract, we must
uphold it." Id.; see also United Paperworkers Int'l Union v.
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Misco, Inc., 484 U.S. 29, 38 (1987) ("[A]s long as the arbitrator
is even arguably construing or applying the contract and acting
within the scope of his authority, that a court is convinced he
committed serious error does not suffice to overturn his
decision."). That said, "[t]he arbitrator cannot . . . ignore the
contract and simply dispense 'his own brand of industrial
justice.'" Kraft Foods, Inc. v. Office & Prof'l Emps. Int'l Union,
Local 1295, 203 F.3d 98, 100 (1st Cir. 2000) (quoting United
Steelworkers v. Enter. Wheel & Car Corp., 363 U.S. 593, 597
(1960)).
The Hospital suggests that the Supreme Court's command
that we uphold an arbitrator's decision so long as "the arbitrator
is even arguably construing or applying the contract and acting
within the scope of his authority," Misco, Inc., 484 U.S. at 38,
denotes a disjunctive test whereby a reviewing court only reaches
the "arguably construing or applying" (i.e., "plausibility")
inquiry after first determining that the arbitrator acted within
the scope of his authority. In this proffered, disjunctive
formulation of our standard of review, the Hospital appears to
conflate the standard by which we review questions of arbitrability
with that which we use to address the question presented in this
case -- that is, whether the arbitrator acted within the scope of
the authority granted to him under the parties' agreement. Compare
Grand Wireless, Inc. v. Verizon Wireless, Inc., 748 F.3d 1, 7 (1st
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Cir. 2014) ("'Unless the parties clearly and unmistakably provide
otherwise,' the court must resolve a disagreement among the parties
as to whether an arbitration clause applies to a particular
dispute." (citation omitted) (quoting AT&T Techs., Inc. v.
Commc'ns Workers, 475 U.S. 643, 649 (1986))), with Salem Hosp.,
449 F.3d at 238 (observing that in reviewing an arbitrator's
interpretation of her own authority under the parties' agreement,
we ask "whether the arbitrator had a plausible basis for her
determination"). While we acknowledge that it might sometimes be
difficult to determine whether a challenge to an arbitration award
poses a question of arbitrability or a question of whether the
arbitrator acted within the scope of his delegated authority, see
Oxford Health Plans LLC v. Sutter, 569 U.S. 564, 569 n.2 (2013)
(noting that the plaintiff might have alternatively challenged the
arbitration award on the basis of arbitrability), the Hospital
itself frames the question at hand as a challenge to the manner in
which the arbitrator elected to resolve the admittedly arbitrable
dispute as exceeding the scope of his authority under the terms of
the CBA. This question is governed by our normal, deferential
plausibility standard. See, e.g., id. at 568-69; N. New England
Tel. Operations LLC v. Local 2327, Int'l Bhd. of Elec. Workers,
735 F.3d 15, 21 (1st Cir. 2013); Salem Hosp., 449 F.3d at 238;
Poland Spring Corp. v. United Food & Commercial Workers Int'l
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Union, Local 1445, 314 F.3d 29, 33 (1st Cir. 2002); Dorado Beach
Hotel Corp., 959 F.2d at 4–5.
In finding that the CBA invites no plausible
interpretation that would have allowed the arbitrator to reject
the Hospital's chosen penalty of termination, the district court
-- like the Hospital -- relied on two basic arguments. First, it
pointed to the fact that the CBA incorporated a policy that deemed
threatening or intimidating conduct to be just cause for
termination. Second, it relied on the CBA's reservation to the
Hospital of certain rights in connection with employee discipline.
We consider each argument in turn.
A.
Appendix G of the CBA incorporates into the parties'
agreement "[a]ll existent policies applicable to bargaining unit
employees." The district court first looked to one such policy,
the "Disciplinary Action Policy," which categorizes employee
infractions within three groups and provides appropriate
disciplinary responses based on the severity of the offense and
the employee's history of misconduct. Group III includes the most
serious employee infractions, such as reporting to work under the
influence of alcohol, possessing weapons on hospital property
without permission, and theft, and it also includes the less
pellucid offense of "[t]hreatening, intimidating, or coercing
fellow employees on the premises at any time for any purpose."
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This latter offense, in turn, refers to the Hospital's "Zero
Tolerance for Disrespect" policy, which provides that the Hospital
"will not tolerate verbal, written or physical conduct by anyone
who works or practices at [the Hospital]" that "[c]reates an
intimidating, offensive or hostile environment" or "[d]isrupts the
operation of the [H]ospital or individuals working therein." While
Group I1 and Group II2 offenses provide for a scheme of progressive
discipline -- beginning with a verbal or written warning, including
a final written warning, and ending with termination -- the only
recommended penalty for a Group III offense is "immediate
termination."
The district court then observed that once the
arbitrator concluded that Bean's conduct "constituted a 'civil
battery'" -- a finding the court deemed "consistent with the
Hospital's determination that Bean had engaged in a Group III
offense for which immediate termination was justified" -- the
arbitrator's "role was fulfilled" and he was not at liberty to
1 Group I includes infractions such as "[a]bsenteeism,"
"[l]oitering during work hours," and "[o]ther minor inappropriate
behavior." The policy provides for a verbal warning, a written
warning, a final written warning, and termination for a first,
second, third, and fourth Group I offense, respectively.
2 Group II includes offenses such as "[o]bscene or
inappropriate language," "[s]ubstantial interference with work of
other employees," and "[o]ther inappropriate behavior." The
policy provides for a written warning, a final written warning,
and termination for a first, second, and third Group II offense,
respectively.
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prescribe a lesser form of discipline. Steward Holy Family
Hospital, Inc., 350 F. Supp. 3d at 14–15. The Hospital parrots
this reasoning on appeal.
We cannot accept this logic because we do not read the
arbitrator's decision as concluding that Bean's offense was a Group
III offense. The decision does not expressly assign Bean's offense
to any single Group. Nevertheless, the arbitrator did expressly
find that Bean's act "was not so serious that it justified
termination in the first instance" and that it called for
progressive discipline, including a written warning and a final
warning, prior to termination. Only Groups I and II call for
proceeding in this manner.
The Hospital contends that the classification of Bean's
infraction as a Group III offense is nevertheless "inescapable,"
constituting an "intentional tort" of just the sort referred to in
the Hospital's "Zero Tolerance for Disrespect" policy. In other
words, the Hospital would have us deem implausible any reading of
this policy that would classify Bean's offense as a non-Group III
offense. We cannot agree. The Hospital's Disciplinary Action
Policy by its terms provides "guidelines" and "examples" that would
warrant a recommended penalty of immediate termination. And some
of the descriptions of qualifying conduct listed in the
Disciplinary Action Policy are quite vague, leaving the arbitrator
significant discretion to interpret their meaning and determine
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whether they encompass Bean's infraction. See, e.g., Poland Spring
Corp., 314 F.3d at 36 ("[A]rbitrators have significant discretion
to interpret the terms of a collective bargaining agreement.");
id. at 37 (Boudin, J., concurring) ("Here, the arbitrator could
permissibly have read the contract to mean that some acts of
disobedience constitute 'insubordination' within the meaning of
the contract and that other, less severe acts -- although literally
disobedience -- do not."); Ga.-Pac. Corp. v. Local 27, United
Paperworkers Int'l Union, 864 F.2d 940, 945 n.2 (1st Cir. 1988)
("Although the collective bargaining agreement in this case
authorizes immediate discharge for dishonesty, it does not define
that term. It is thus up to an arbitrator to decide whether a
given pattern of conduct amounts to dishonesty.").
The Hospital argues that Bean's conduct necessarily
falls under the Group III offense of "[t]hreatening" or
"intimidating" a "fellow employee[] on the premises at any time
for any purpose." But the arbitrator found that while "Ms.
Waterhouse understandably felt mildly bullied and upset by the[ir]
interaction," nothing in the record indicated that "[Bean]
intended harm or that Ms. Waterhouse was placed in fear." Indeed,
Monica Messina, the only third-party witness to the incident,
described the cheek squeeze as a "friendly gesture." And in light
of the quite serious offenses listed in Group III -- such as the
"[u]nauthorized possession of weapons on hospital property,"
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"[t]heft," and "[r]eporting to work under the influence of alcohol
or any other substance" -- an arbitrator could have plausibly
interpreted Bean's conduct as not amounting to the same level of
seriousness as the other offenses listed in that category. For
similar reasons, nothing in the record compels the conclusion that
Bean's conduct "[c]reate[d] an intimidating, offensive or hostile
environment" or "[d]isrupt[ed] the operation of the [H]ospital or
individuals working therein" so as to trigger the Hospital's Zero
Tolerance Policy. In short, even assuming that the arbitrator
could not overrule a decision by the Hospital to terminate an
employee for committing a Group III offense, nothing in the CBA or
the incorporated policies inarguably required that the arbitrator
classify Bean's conduct as a Group III offense. Hence, the
Hospital's argument that the arbitrator exceeded his authority by
misapplying the CBA and rejecting its recommended penalty of
termination for a Group III offense fails.
B.
More ambitiously, the Hospital argues that the CBA
generally insulated the Hospital's choice of discipline from
arbitral review once the arbitrator concluded that just cause
existed for discipline of some type, Group III or not. In its
view, "[h]aving concluded that [Bean] was guilty of the misconduct
for which she had been terminated, the arbitrator lacked the
authority to modify the discipline." In support of this reading,
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the Hospital points to Article X, section 5 and Article XXXIII,
section 1 of the CBA (both set forth above).
We find the foregoing provisions too ambiguous to
shackle the arbitrator in this way. The Hospital certainly
retained the exclusive right to discipline and discharge even
tenured, non-probationary nurses, but it could only do so for "just
cause." Similarly, while the CBA states that the "Hospital may
utilize whatever level of discipline it believes is appropriate,"
the Hospital acknowledges on appeal that the CBA expressly
conditions this right on the Hospital making "reasonable efforts
to utilize progressive discipline." The Hospital's reliance on
the provision that prohibited the arbitrator from "substitut[ing]"
his discretion for that of the hospital fails for the same reason.
The Hospital's discretion was already limited by just cause and
its promise to make "reasonable efforts to utilize progressive
discipline." In the words of the Hospital's brief: "In Article
XXXIII of the CBA, the parties agreed that the Hospital has the
right to 'utilize whatever level of discipline it believes is
appropriate depending on the circumstances,' provided that it
makes reasonable efforts to use progressive discipline" (emphasis
added). And, as we have already explained, Appendix G to the CBA
incorporates the Disciplinary Action Policy, which identifies
progressive forms of discipline in a manner that omits discharge
as an option in many situations, plausibly including the situation
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presented here. One must strain too hard to find no plausible
construction of this language that would allow an arbitrator to
conclude that the Hospital impermissibly forewent the use of
progressive discipline in this case.
The CBA itself provides further support for the
conclusion that the Hospital's reserved right to discipline
workplace misconduct is conditioned on notions of just cause and
its use of progressive discipline, the reasonableness of which is
subject to arbitral review. Article XI, section 5 addresses one
particular type of employee misconduct not at issue here:
violations of the contract's "no strike" provisions. The language
in that section plainly says what the Hospital would have us read
the more general discipline and discharge provisions as saying for
all misconduct: "[A]n arbitrator may consider only whether the
employee engaged in conduct which violates the provisions of this
Article . . . [and] shall not have the authority to modify the
degree of discipline imposed."3 The fact that the same CBA eschews
3 Article XI, section 5 reads in its entirety: "Any Nurse
who engages in any conduct which violates the provisions of this
Article shall be subject to discipline up to and including
immediate discharge. In an arbitration concerning the discipline
or discharge of an employee for violating the provisions of this
Article, an arbitrator may consider only whether the employee
engaged in conduct which violates the provisions of this Article.
If the Arbitrator concludes that the employee engaged in any
conduct which violates the provisions of this Article, such
violation shall constitute just cause, and the grievance shall be
denied. The Arbitrator shall not have the authority to modify the
degree of discipline imposed."
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such simple and plain language regarding discipline for other
conduct (such as Bean's) supports the arbitrator's assumption that
his authority was not so limited.
The Hospital also seeks haven in three prior cases in
which we have stricken arbitral awards. See Poland Spring Corp.,
314 F.3d at 31, 34–35 ("[O]nce an arbitrator finds that an employee
has committed an act specifically listed in the collective
bargaining agreement as providing just cause for termination, the
arbitrator is not free to fashion a separate remedy apart from the
one provided by the parties' agreement."); Ga.-Pac. Corp., 864
F.2d at 945–46 (concluding that once the arbitrator found that the
employee had committed an act of dishonesty for which the agreement
imposed immediate discharge as a sanction, "the arbitrator was
barred from further inquiry"); S.D. Warren Co. v. United
Paperworkers' Int'l Union, AFL-CIO, Local 1069, 845 F.2d 3, 7–8
(1st Cir. 1988) (finding that the arbitrator was not even arguably
construing or applying the agreement when "the contract plainly
state[d] that the company ha[d] the sole right to discharge
employees for the violation which admittedly occurred," but the
arbitrator nevertheless ordered a reduced penalty). We disagree
with the Hospital that this case is analogous to these earlier
precedents. Here, the CBA did not inarguably grant the employer
the right to terminate a tenured, non-probationary nurse for the
type of conduct at issue without first following the parties'
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agreement that the Hospital would make reasonable efforts to use
progressive discipline.
Because we find that the arbitrator did not exceed the
scope of his authority under the CBA in determining that Bean's
conduct did not fall within a Group III offense and ordering a
lesser form of discipline in accordance with the CBA and the
Hospital's own disciplinary policies, we need not address the
Union's alternative argument that the parties' submissions
expanded the scope of the arbitrators' authority to order a less
severe form of discipline. Nor does the Hospital present us with
any argument that the arbitrator selected the wrong level of
discipline in view of Bean's prior infractions.
III.
For the foregoing reasons, we reverse the district
court's entry of summary judgment for the Hospital, and we remand
for proceedings consistent with this opinion.
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