On November 18, 2015, in DeGrandis v. Children's Hospital Boston, the US Court of Appeals for the First Circuit held that an employee's last chance agreement (LCA), which precluded the employee and his union from using a collective bargaining agreement (CBA) grievance and arbitration procedure extended the statute of limitations for his claim that the employer breached the CBA by terminating him without just cause. The court applied the six-year breach of contract statute of limitations under Massachussetts law instead of the six-month statute of limitations for hybrid claims under the Labor Management Relations Act (LMRA) that allege both a breach of a CBA against the employer and a breach of the duty of fair representation (DFR) by the employee's union. ( (1st Cir. Nov. 18, 2015).)

DeGrandis worked for the Children's Hospital Boston. The Hospital and DeGrandis's union had a CBA that required just cause for discharges and provided for a grievance and arbitration procedure.

In July 2007, after DeGrandis filed a grievance over the Hospital's proposed termination of his employment after he missed work due to three on-the-job injuries, DeGrandis, the Hospital, and the union signed an LCA providing that:

On February 29, 2008, the Hospital terminated DeGrandis for "failure to meet job performance standards." On February 25, 2014, several days shy of six years since his termination, DeGrandis sued the Hospital for breach of contract under the LMRA. The district court dismissed DeGrandis's complaint, finding that:

DeGrandis appealed to the First Circuit.

The First Circuit noted that:

(29 U.S.C. § 185(a); Ramirez-Lebron v. Int'l Shipping Agency, Inc., 593 F.3d 124, 131 (1st Cir. 2010).)

(Daigle v. Gulf State Utils. Co., 794 F.2d 974, 977 (5th Cir. 1986).)

The First Circuit relied on the Fifth Circuit's decision in Daigle and reversed the district court's decision, holding that:

The court rejected the hospital's argument that the LCA (signed in 2007) was the final, binding resolution for DeGrandis's 2008 termination grievance, finding that:

Ordinarily employees cannot bring breach of CBA actions unless they, through their union, attempt to use their CBA's grievance and arbitration process. If the union chooses not to pursue the grievance to arbitration or fails to win in arbitration, some employees bring a hybrid claim against their union and their employer under the LMRA. In most jurisdictions, courts apply a six-month statute of limitations for that claim, mirroring the six-month limitations period for filing unfair labor practices under the NLRA.

Employers often use LCAs to bar further grievances and arbitrations concerning employees with poor performance or attendance records. Employers hope that entering into these agreements might spare them of future time and expenses related to a later termination.

DeGrandis adds a nuance to the lightly developed precedent that an employee can bring a breach of CBA action against his employer, without a DFR claim against his union, where the CBA does not provide grievance and arbitration to resolve that employee's contractual dispute. In DeGrandis, the LCA foreclosed the employee from challenging his discharge through the CBA's grievance and arbitration process entirely, so DeGrandis had no obligation to exhaust CBA remedies or to file the claim within six months. The court noted that the analysis would have been different had the LCA, for example, permitted arbitration on whether the employee committed the infraction for which he was discharged while precluding the arbitrator from reducing the discipline for the infraction. In the First Circuit, and potentially other circuits that adopt DeGrandis, employees may be able to bring suits against their employer solely for a breach of CBA within the state's breach of contract statute limitations (often six years) rather than the customary hybrid action with a six-month statute of limitations.