Opinion
1:03-cv-1823-LJM-VSS
January 6, 2004
ORDER ON PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION
This matter is before the Court on Plaintiff's, National Railroad Passenger Corporation ("Amtrak" or "Plaintiff'), Motion for a Preliminary Injunction. Amtrak contends that it will suffer irreparable harm unless Defendants, Brotherhood of Maintenance of Way Employees, and Brotherhood of Maintenance of Way Employees Conrail System Federation, and Perry K. Geller (collectively "BMWE" or "Defendants"), are enjoined from striking at Amtrak's Beech Grove, Indiana, maintenance facility. The Court held a hearing on the dispute on December 4, 2003. The Court ultimately agreed with Amtrak's position on the matter and, based on written findings of fact and conclusions of law, issued a temporary restraining order (the "TRO") in Amtrak's favor on December 5, 2003.
The dispute centers around Amtrak's right to contract out certain work at the Beech Grove facility. Both BMWE and the Transport Workers Union of America ("TWU") went on strike over the issue. The Court's December 5, 2003, order enjoined both unions from striking, and compelled the parties to participate in expedited arbitration over the dispute. Based on the TRO, Amtrak and TWU agreed to pursue expedited arbitration on the subcontracting issue, and TWU agreed, pending the adjustment board's decision on the grievance, that it would not conduct any strike over the issue at Amtrak's Beech Grove facility. See Procedural Stipulation and Order, Doc. No. 24. Amtrak agreed to withdraw its Motion for a Preliminary Injunction against TWU, and dismiss its action against TWU upon issuance of the adjustment board's award. Id.
BMWE agreed not to conduct a strike pending the Court's decision on Amtrak's Motion for a Preliminary Injunction. Id. BMWE represented that it would conduct a strike over the contracting out issue in the event that the Court denies Amtrak's Motion for a Preliminary Injunction. Id. Both Amtrak and BMWE submitted supplemental memorandums in support of their positions on the preliminary injunction motion. For the reasons set forth below, the Court GRANTS Plaintiff's Motion for a Preliminary Injunction.
I. FACTUAL BACKGROUND
Amtrak's Beech Grove maintenance facility employs approximately 630 employees, including management, members of BMWE, members of TWU, and members of other labor organizations. The employees at the Beech Grove facility are responsible for the re-manufacturing and overhauling of Amtrak's locomotive engines and passenger cars.
Amtrak and BMWE are parties to a collective bargaining agreement (the "CBA") that was in effect at all relevant times. Rule 24 of the CBA provides:
RULE 24 — CONTRACTING OUT
1. In the event [Amtrak] plans to contract out work within the scope of the schedule agreement, the Chief Engineer shall notify the General Chairman [of BMWE] in writing as far in advance of the date of the contracting transaction as is practicable and in any event not less than 15 days prior thereto.
2. If the General Chairman requests a meeting to discuss matters relating to the said contracting transaction, the Chief Engineer or his representative shall promptly meet with him for that purpose. The Chief Engineer or his representative and the General Chairman or his representative shall make a good faith attempt to reach an understanding concerning said contracting, but if no understanding is reached the Chief Engineer may nevertheless proceed with said contracting, and the General Chairman may file a progress claim in connection therewith.
3. Nothing in this Rule shall affect the existing rights of either party in connection with contracting out. Its purpose is to require [Amtrak] to give advance notice and, if requested, to meet with the General Chairman to discuss and if possible reach an understanding in connection therewith.
Ex. B (emphasis added).
A May 2003 inspection at the Beech Grove facility revealed that two rail tracks needed repair. The defective tracks were used for storage of rail cars. Amtrak decided to contract out the repair work. On November 5, 2003, Amtrak gave BMWE notice of its intent to contract out the work, and informed BMWE that the contractors would start on November 10, 2003. The parties held a conference about the matter on November 7, 2003, during which BMWE opined that Amtrak's decision to contract out the work was in violation of Rule 24 of the CBA. Amtrak and BMWE did not resolve the issue, and the contractors began work on November 10, 2003. BMWE later learned that the contractors started work at Amtrak on November 3, 2003, prior to the November 5, 2003, notice.
As required by the Railway Labor Act ("RLA"), the CBA contains a grievance resolution procedure. Ex. B, Rule 14. BMWE filed a grievance over the contracting out dispute on November 13, 2003. BMWE alleged:
Statement of claim: The Claimants are aggrieved they have been deprived of work when the Company allowed private contractors (Rail Work Track Services) onto the property, which is maintained by the BMWE represented employees, for the purpose of correcting Class I defects and repairing tracks #4 and #5 at the Beech Grove facility. The work consists of tie installation and track surfacing, replacing damaged and defective rail. The contractor has five employees working. The five (5) Claimants are currently furloughed and are available and willing to perform the work. This work has always been performed by the Maintenance of Way forces in the Beech Grove facility since 1976.
Ex. C. BMWE further stated that BMWE personnel had a right to perform the track repair at issue under the CBA's Work Scope provision, and demanded that its furloughed employees be returned to work and that the contractors be removed from the property.
On December 3, 2003, the Beech Grove BMWE-represented employees initiated a strike against Amtrak in response to the contracting out dispute.
II. RLA STANDARDS
The RLA was enacted "[t]o avoid any interruption to commerce or to the operation of any carrier engaged therein," and "to provide for the prompt and orderly settlement of all disputes concerning rates of pay, rules, or working conditions." 45 U.S.C. § 151 a. The RLA gives district courts a very limited role in effectuating its provisions. District courts only decide what type of statutorily-mandated dispute resolution procedure is appropriate, depending on the category of dispute. See Bhd. of Locomotive Eng'rs v. Springfield Terminal Ry. Co., 210 F.3d 18, 23 (1st Cir. 2000). The Supreme Court, interpreting the language of the RLA, has identified two categories of carrier/employee labor disputes: "minor" and "major" disputes. Elgin, J. E.R. Co. v. Burley, 325 U.S. 711, 723 (1945).
Section 2 Sixth of the RLA is the statutory basis for minor disputes, which are disputes: arising out of grievances or out of the interpretation or application of agreements concerning rates of pay, rules, or working conditions.45 U.S.C. § 152. This category of disputes:
contemplates the existence of a collective agreement already concluded or, at any rate, a situation in which no effort is made to bring about a formal change in terms or to create a new one. The dispute relates either to the meaning or proper application of a particular provision with reference to a specific situation or to an omitted case. In the latter event the claim is founded upon some incident of the employment relation, or asserted one, independent of those covered by the collective agreement, e.g., claims on account of personal injuries. In either case the claim is to rights accrued, not merely to have new ones created for the future.See Consol. Rail Corp. v. Railway Labor Executives' Ass'n, 491 U.S. 299, 303 (1989) ("Conrail") ( quoting Burley, 325 U.S. at 723). Minor disputes "are those that are grounded in the CBA." Hawaiian Airlines, Inc. v. Norris, 512 U.S. 246, 257 (1994). A dispute is minor if the act in question is "arguably justified" by the CBA. See Conrail, 491 U.S. at 307.
Section 2 Seventh of the RLA is the statutory basis for major disputes, providing that:
No carrier, its officers, or agents shall change the rates of pay, rules, or working conditions of its employees, as a class, as embodied in agreements except in the manner prescribed in such agreements . . .45 U.S.C. § 152 Seventh. The major disputes category:
relates to disputes over the formation of collective agreements or efforts to secure them. They arise where there is no such agreement or where it is sought to change the terms of one, and therefore the issue is not whether an existing agreement controls the controversy. They look to the acquisition of rights for the future, not to assertion of rights claimed to have vested in the past.Conrail, 491 U.S. at 303 ( quoting Burley, 325 U.S. at 723). Major disputes seek to create contractual rights while minor disputes seek to enforce contractual rights. See id. at 302.
III. DISCUSSION A. MINOR OR MAJOR DISPUTE?
The centralissue before the Court is one of classification: whether the contracting out dispute should be classified as "minor" or "major" under the RLA. This classification has significant consequences because the RLA specifies different procedures to resolve each of the two types of disputes. Minor disputes are subject to compulsory and binding arbitration procedures before the National Railroad Adjustment Board, or an adjustment board established by the parties. 45 U.S.C. § 153 Second. Significantly, the RLA prohibits striking over minor disputes. See Bhd. of Maint. of Way Employees v. Atchison, Topeka Santa Fe Ry. Co., 138 F.3d 635, 638 (7th Cir. 1997). On the other hand, the RLA requires a lengthy process of bargaining and negotiation to address major disputes. See id. If this bargaining process does not resolve the major dispute, unions "may resort to raw `economic force.'" See id. (quoting Conrail, 491 U.S. at 303). In addition, parties to a major dispute must maintain the status quo during the pendency of the bargaining and negotiation, meaning that the employer may not implement the contested changes and the union may not strike during the pendency of the bargaining and negotiation. See Conrail, 491 U.S. at 303-04.
In litigation over the major/minor classification issue, unions usually argue that the dispute is major because they want the employer to maintain the status quo and because they want to have the option to strike in the future, while employers generally will characterize disputes as minor because unions cannot stake over minor disputes and the employer need not maintain the status quo pending arbitration of a minor dispute. Not surprisingly, BMWE and Amtrak take those respective positions before the Court in the current litigation. After listening to argument on the issue at the December 4, 2003, hearing and reviewing the parties' written submissions, the Court ruled in favor of Amtrak, classifying the dispute as a minor one. The Court observed that major disputes relate to the formation of CB As or efforts to formally change them, and that there is an existing CBA between the parties, and Amtrak has made no formal efforts to change it. The Court also noted that Amtrak's apparent noncompliance with the notice provisions of the CBA does not mean Amtrak was making a unilateral change to the CBA. Furthermore, the Court opined that BMWE undermined its position before the Court by filing a grievance over the matter (grievances may only be filed over minor disputes). In addition, the Court emphasized that the dispute could be conclusively resolved by interpreting and applying the provisions of the CBA, and this is the "distinguishing characteristic" of minor disputes. In its Memorandum in Opposition to Amtrak's Motion for a Preliminary Injunction, BMWE submits that the Court's decision on the TRO "was based on a misapprehension and misapplication of the Conrail test." Def.'s Memo in Opposition at 5.
BMWE's main argument is a straight-forward one. Under Conrail, the employer must be able to "arguably justify" its challenged act by the express or implied terms of the CBA between the parties. The instant CBA requires Amtrak to give BMWE at least 15 days notice if it intends to contract out work. Ex. B, Rule 24. In addition, Amtrak officials must meet and make a good faith effort to reach an agreement about the proposed contracting out if requested by BMWE. Id. In this case, Amtrak only gave BMWE 5 days notice instead of the required 15 days notice. In addition, BMWE subsequently learned that the contractors started work at Amtrak on November 3, 2003, two days prior to Amtrak's November 5, 2003, notice, which suggests that Amtrak's November 7, 2003, meeting with BMWE was not in good faith. Due to this apparently clear violation of the procedural provisions of the contracting out clause, BMWE contends that Amtrak's action cannot be "arguably justified" by the terms of the CBA.
In the Court's view, BMWE reads the Conrail "arguably justified" test in a vacuum, and fails to distinguish language in Conrail and other Supreme Court precedent that substantially undermines its position. In Conrail, the Supreme Court first defined the major and minor dispute categories before discussing the light burden (the "arguably justified" standard) that railroads must carry to establish that the dispute is minor. See Conrail, 491 U.S. at 302-06. In defining minor disputes, the Supreme Court commented:
[T]he line in Burley looks to whether a claim has been made that the terms of an existing agreement either establish or refute the presence of a right to take the disputed action. The distinguishing feature of [a minor dispute] is that the dispute may be conclusively resolved by interpreting the existing agreement.Id. at 306 (emphasis added). The Supreme Court confirmed this definition of minor disputes in a more recent case:
Our case law confirms that the category of minor disputes contemplated by § 15 la are those that are grounded in the CBA. We have defined minor disputes as those involving the interpretation or application of existing labor agreements. See, e.g., Conrail, 491 U.S., at 305, 109 S.Ct, at 2482 ("The distinguishing feature of [a minor dispute] is that the dispute may be conclusively resolved by interpreting the existing [CBA]"); Pittsburgh Lake Erie R. Co. v. Railway Labor Executives Assn., 491 U.S. 490, 501, n. 4, 109 S.Ct. 2584, 2592, n. 4, 105 L.Ed.2d 415 (1989) ("Minor disputes are those involving the interpretation or application of existing contracts"); Trainmen, 353 U.S., at 33, 77 S.Ct., at 637 (minor disputes are "controversies over the meaning of an existing collective bargaining agreement"); Slocum v. Delaware, L. W.R. Co., 339 U.S. 239, 243, 70 S.Ct. 577, 579, 94 L.Ed. 795 (1950) (RLA arbitral mechanism is meant to provide remedies for "adjustment of railroad-employee disputes growing out of the interpretation of existing agreements").Hawaiian Airlines, 512 U.S. at 257. The Conrail Court also noted that "major disputes seek to create contractual rights, minor disputes to enforce them." Conrail, 491 U.S. at 303.
With this definition of minor disputes in mind, the Court turns to the instant facts. There is an existing CBA between the parties. The CBA contains an explicit pro vision regarding contracting out, and the provision requires Amtrak to give BMWE at least 15 days notice prior to the commencement of the outside contractors' work. BMWE asserts that Amtrak violated this notice provision (as well as the good faith meeting provision), and Amtrak does not offer evidence to the contrary. This dispute can be "conclusively resolved by interpreting the existing agreement." Conrail, 491 U.S. at 306. The Supreme Court has called this the "distinguishing characteristic" of a minor dispute. Id. In other words, the dispute is "grounded in the CBA." Hawaiian Airlines, 512 U.S. at 257. In addition, as the Court noted in its December, 5, 2003, order, "At bottom, BMWE seeks enforcement of the terms of the work scope language and contracting out language of the CBA. As stated by the Supreme Court in Conrail, minor disputes seek to enforce contractual rights while major ones seek to create new ones." Doc. No. 21 (citing Conrail, 491 U.S. at 303).
The Supreme Court added the "arguably justified" portion of the test to assure that one party would not be able to unilaterally impose new contractual terms through their characterization of the dispute, thereby violating the prohibitions of § 2, Seventh, and § 6 of the RLA. The Court does not equate a single procedural violation of a CBA with unilateral imposition of new contractual terms. The Seventh Circuit has made similar conclusions: "The resolution of the case depends upon the interpretation of the agreement, and while we realize that [employer's] actions might be in violation of the agreement, it is for the appropriate adjustment board, and not this court, to draw the boundaries of the practices allowed by the agreement." Nat'l Ry. Labor Conf. v. Int'l Ass'n of Machinists, 830 F.2d 741, 748 (7th Cir. 1987). In a more recent foray into a major/minor classification dispute, the Seventh Circuit noted that "minor disputes are about enforcing rights already agreed upon in a contract" and that "the distinction hinges on whether old rights are being enforced or new rights created." Bhd. of Maint. of Way Employees, 138 F.3d at 638-39. Amtrak and BMWE already agreed upon Amtrak's right to contract out in the CBA, and Amtrak's decision to contract out certain work without giving BMWE proper notice does not evidence an intent to create new contractual rights. As noted in the Court's order on the TRO, the essence of this dispute is about Amtrak's ability to contract out work that BMWE believes is union work, and the CBA contains an explicit contracting out provision. As a result, Amtrak's position is "arguably justified" by the terms of the CBA.
None of the case law that BMWE relies on stands for the proposition that a single procedural violation of a CBA amounts to a unilateral change in the contract such that a dispute should be classified as major. For example, BMWE cites the Seventh Circuit decision in Burlington Northern R.R. Co. v. United Transp. Union, 862 F.2d 1266, 1273 (7th Cir. 1988) in support of its argument that Amtrak's failure to provide sufficient notice prior to contracting out was a unilateral change to the contract. However, in Burlington, the Seventh Circuit explained:
Major disputes are limited to those disputes which arise in the absence or silence of a collective bargaining agreement. Only disputes that cannot be resolved though interpretation or analysis of a collective bargaining agreement are considered major.Id. at 1271. The CBA in Burlington was silent about the disputed action, and the Seventh Circuit concluded that the dispute was major because it could not be resolved by reference to the applicable CBA. Id. at 1273. Similarly, when this Court concluded in International Brotherhood of Teamsters v. Chautauqua Airlines, 186 F. Supp.2d 901 (S.D. Ind. 2001), that a carrier's reduction of the workweek from 40 to 32 hours involved a major dispute, that result was premised on the silence of the CBA about the issue and the lack of implied terms justifying the action. See id. at 910 ("Nothing in the parties' collective bargaining agreement addresses [the carrier's] ability to reduce the scheduled workweeks for full-time employees . . . Because Chautaqua's claim on contractual justification cannot be found within the contract language, its claim must be termed insubstantial").
BMWE relies heavily on a district court case from another jurisdiction. See Int'l Ass'n of Machinists v. U.S. Airways, 287 F. Supp.2d 599 (W.D. Pa. 2003). However, the Court will rely on binding precedent from the Supreme Court and the Seventh Circuit.
Courts frequently acknowledge that the major/minor distinction is nebulous. See, e.g., Nat. Ry. Labor Conf. v. Int'l Ass'n of Machinists, 830 F.2d 741, 748 (7th Cir. 1987) ("While the paradigmatic formulation of this major/minor distinction is easy to recite, it has been somewhat more difficult to apply."). Doubts are resolved in favor of construing disputes as minor. See Ry. Labor Executives Ass'n v. Norfolk and W. Ry. Co., 833 F.2d 700, 705 (7th Cir. 1987) ("Because a major dispute can escalate into a strike, if there is any doubt as to whether a dispute is major or minor a court will construe the dispute to be minor."); Bhd of Locomotive Engineers v. Atchison, Topeka Santa Fe Ry. Co., 768 F.2d 914, 920 (7th Cir. 1985). To the extent that there is doubt about the instant characterization because of Amtrak's procedural violation of the CBA, the Court resolves that doubt in favor of construing this dispute as minor. Amtrakhas carried its "light" burden of establishing that this dispute is a minor one. Conrail, 491 U.S. at 305. Resolution of the contracting out issue "is well within the normal ken of arbitrators." Bhd. of Locomotive Engineers, 768 F.2d at 921.
B. INJUNCTIVE RELIEF
As stated above, the RLA prohibits strikes over minor disputes. See Bhd. of Maint. of Way Employees, 138 F.3d at 638. As detailed in the Court's order on the TRO, Amtrak meets the criteria for injunctive relief under the Norris-LaGuardia Act, and those circumstances have not changed since the issuance of the TRO. Doc. No. 21. See 29 U.S.C. § 107. Because this dispute is a minor one and because Amtrak is entitled to injunctive relief under the applicable criteria, the Court GRANTS Plaintiff's Motion for a Preliminary Injunction.
IV. CONCLUSION
For the reasons stated herein, the Court GRANTS Plaintiff's Motion for a Preliminary Injunction.
IT IS SO ORDERED this 6th day of January, 2004.