Dispute over Expert Witness Use in Union Member Disciplinary Hearings Was a Minor Dispute Subject to Exclusive RLA Arbitral Jurisdiction: Seventh Circuit | Practical Law

Dispute over Expert Witness Use in Union Member Disciplinary Hearings Was a Minor Dispute Subject to Exclusive RLA Arbitral Jurisdiction: Seventh Circuit | Practical Law

In Brotherhood of Maintenance of Way Employees Division/IBT v. Norfolk Southern Railway Company, the US Court of Appeals for the Seventh Circuit affirmed the district court's judgment that a dispute over the use of expert witnesses by a railroad employer in union member disciplinary hearings was a minor dispute subject to the exclusive arbitral jurisdiction of the Railway Labor Act (RLA) Adjustment Board.

Dispute over Expert Witness Use in Union Member Disciplinary Hearings Was a Minor Dispute Subject to Exclusive RLA Arbitral Jurisdiction: Seventh Circuit

by Practical Law Labor & Employment
Published on 13 Mar 2014 • USA (National/Federal)
In Brotherhood of Maintenance of Way Employees Division/IBT v. Norfolk Southern Railway Company, the US Court of Appeals for the Seventh Circuit affirmed the district court's judgment that a dispute over the use of expert witnesses by a railroad employer in union member disciplinary hearings was a minor dispute subject to the exclusive arbitral jurisdiction of the Railway Labor Act (RLA) Adjustment Board.
On March 11, 2014, in Brotherhood of Maintenance of Way Employees Division/IBT v. Norfolk Southern Railway Company, the US Court of Appeals for the Seventh Circuit affirmed the district court's judgment that a dispute over the use of expert witnesses by a railroad employer in union member disciplinary hearings was a minor dispute subject to the exclusive arbitral jurisdiction of the Railway Labor Act (RLA) Adjustment Board (12-3415, (7th Cir. Mar. 11, 2014)).

Background

The union represents maintenance-of-way workers employed by Norfolk Southern Railway Company (Norfolk). In 2001, the parties added a System Discipline Rule (Discipline Rule) to their existing collective bargaining agreements (CBAs). The Discipline Rule entitles the union members to a fair and impartial investigation before Norfolk disciplines or dismisses them or places an unfavorable mark on their records.
Norfolk terminated four union members after its investigation concluded that they made false statements about injuries sustained on the job. In each investigation, Norfolk submitted an expert accident reconstruction report as evidence. However, the expert did not testify at any of the investigations and Norfolk did not provide notice to the accused employees that it would rely on an expert report in its investigations.
The union then filed suit in district court requesting a permanent injunction to prevent Norfolk from using the expert reports, or any expert witness testimony, unless Norfolk follows court-imposed disciplinary proceedings. The district court dismissed the action, finding that it lacked jurisdiction to grant the union's request because the union's suit constituted a minor dispute within the exclusive jurisdiction of the RLA. The union appealed to the Seventh Circuit seeking reversal of the district court's decision and the opportunity to proceed to trial.
On appeal, the union argues that:
  • The Seventh Circuit has jurisdiction over the dispute because its complaint raised a question of federal law, namely whether Norfolk violated a provision of the RLA stating that "It shall be the duty of all carriers... to exert every reasonable effort to make and maintain agreements..." (45 U.S.C. § 152).
  • Norfolk breached its duty to "maintain agreements" because it did not provide the union members with a fair and impartial investigation as is required by the Discipline Rule.
Norfolk disagrees, contending that under 45 U.S.C. § 153 this dispute is under the exclusive jurisdiction of the RLA arbitrators and therefore the federal courts have no jurisdiction.

Outcome

The Seventh Circuit affirmed the judgment of the district court, holding that the union's suit is a quintessential minor dispute under the RLA and therefore there is no basis for the Seventh Circuit to establish jurisdiction.
The Seventh Circuit found that:
  • Circuit court precedent has divided labor disputes between employees, employers and labor unions that are governed by the RLA into two categories, "major" and "minor." In a major dispute, the union and the railway seek to change the terms of their CBAs. Minor disputes, however, arise out of grievances or the interpretation or application of agreements concerning rates of pay, rules or working conditions. When minor disputes arise, the parties may petition for arbitration before an RLA Adjustment Board.
  • Consolidated Rail Corporation v. Railway Labor Executives' Association is the seminal case for the legal standard to determine whether railway labor disputes are major or minor (491 U.S. 299 (1989)). Consolidated establishes that:
    • when the parties disagree about the appropriate classification of a dispute, the party seeking to establish it is minor faces a "relatively light burden";
    • to be considered minor, an employer's action only needs to be "arguably justified" by a contractual right under the CBA;
    • an employer's contractual claim can rely on implied contractual terms, which the parties establish through past practices; and
    • only if the employer's assertion of a contractual right is "frivolous or obviously insubstantial" will the court construe the dispute as major and have jurisdiction to hear it on its merits.
  • Applying the Consolidated standard to this case, the district court was correct in its ruling that the dispute is minor. Although the Discipline Rule does not explicitly address how to provide members with a fair and impartial investigation or the role of expert witnesses, the union's conduct during the investigation illustrates the implied terms of the Discipline Rule. For example, during the investigation both the union and Norfolk:
    • submitted expert witness affidavits; and
    • enjoyed latitude to introduce testimony and evidence as they wished.
  • Norfolk also provided evidence from previous disciplinary actions in which the union introduced expert testimony without offering the expert for cross-examination. This evidence showed that the use of hearsay reports by experts:
    • has continuously been used in past disciplinary hearings of union members; and
    • was arguably justified by the implied contractual terms of the CBA.
  • The union's attempt to use 45 U.S.C. § 152 to establish the Seventh Circuit's jurisdiction fails. In contrast to both of the cases relied on by the union to make its argument, here the union is not asking the court to interpret a federal statute but to interpret the CBA, specifically what constitutes a "fair and impartial hearing." This function is reserved exclusively for the RLA Adjustment Board.
  • Norfolk met its burden to prove that its use of expert's reports at disciplinary investigations was justified by a contractual right, albeit an implied contractual right.

Practical Implications

Employers subject to the jurisdiction of the RLA should be well-versed in the distinctions between minor and major disputes and the jurisdictional implications of each type of dispute. When negotiating a CBA with a union, it would be wise for an employer to spell out what kind of evidence will be admissible in a disciplinary hearing. This will avoid the need for the court, in any dispute, to have to rely solely on implied contractual provisions based on the past practices of employees.