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In re the Arbitration between Fitzgerald & General Electric Co.

19 N.Y.2d 325 Court N.Y. Decision date 1967-04-11 English

Delivered by Chief Judge Fuld.

Contents

Majority

p. 325
In the Matter of the Arbitration between Albert J. Fitzgerald, as President of United Electrical, Radio and Machine Workers of America (UE), Respondent, and General Electric Company, Appellant.
Argued February 14, 1967;
decided April 11, 1967.
p. 327
David L. Benetar, Thomas F. Hilbert, Jr., H. H. Nordlinger and Michael I. Bernstein for appellant.
I. It is still the law (1) that no party may be compelled to arbitrate a dispute unless he has agreed to do so and (2) that determination of the question whether he has so agreed is the sole province and responsibility of the court. In the instant case, this conclusion is reinforced and emphasized by the express contract provision requiring such a court determination as a prerequisite to arbitration. (Drake Bakeries v. Bakery Workers, 370 U. S. 254 ; Steelworkers v. American Mfg. Co., 363 U. S. 564 ; Matter of Long Is. Lbr. Co. [Martin], 15 N Y 2d 380 ; Matter of Marchant v. Mead-Morrison Mfg. Co., 252 N. Y. 284 ; Independent Petroleum Workers v. American Oil Co., 324 F. 2d 903 , 379 U. S. 130 ; Retail Clerks Int. Assn. v. Lion Dry Goods, 341 F. 2d 715 , 382 U. S. 839 .) II. The decision of the Appellate Division is based both on a misreading of the arbitration clause here involved and a misapprehension of its scope. (Boeing Co. v. International Union, United A., A. & A. I. Workers, 231 F. Supp. 930 , 349 F. 2d 412 ; Torrington Co. v. Metal Prods. Workers Union, 347 F. 2d 93 , 382 U. S. 940 ; Matter of Carey v. Westinghouse Elec. Corp. 15 A D 2d 7 , 11 N Y 2d 452 , 375 U. S. 261 ; International Union of Elec., Radio & Mach. Workers v. General Elec. Co., 262 F. 2d 265 .) III. Examination of the arbitration clause in the instant case and of the clauses of the bargaining agreement invoiced by the union in support of its claim shows clearly that the alleged dispute does not involve “ the interpretation or application of a provision ” of the agreement and, therefore, is excluded from arbitration. (Flintkote Co. v. Textile Workers Union, 243 F. Supp. 205 ; Matter of Otis Elevator Co. [Carney], 6 N Y 2d 358 ; Matter of General Elec. Co. [Mann], 17 Misc 2d 715 ; Strobe v. Netherland Co., 245 App. Div. 573 ; International Fuel & Iron Corp. v. Donner Steel Co., 221 App. Div. 253 , 221 App. Div. 837 .) IV. The union, having failed to achieve through collective bargaining a contractual provision restricting the right and practice of the company to subcontract, may not now achieve such a limitation through arbitration. (International Union of Elec., Radio & Mach. Workers v. General Elec. Co., 332 F. 2d 485 , 379 U. S. 928 ; Drake Bakeries v. Bakery Workers, 370 U. S. 254 ; United Packinghouse Workers v. Wilson & Co., 340 F. 2d 958 , 380 U. S. 976 .)
p. 328
Robert Z. Lewis and Frank J. Dormer for respondent.
I. It is clear that the arbitration provision set forth in article XVII of the national agreement covers the issues raised by the subcontracting grievances. (Matter of Long Is. Lbr. Co. [Martin], 15 N Y 2d 380 ; Teamsters Local v. Lucas Flour Co., 369 U. S. 95 ; Steelworkers v. American Mfg. Co., 363 U. S. 564 ; Procter & Gamble Union v. Procter & Gamble Mfg. Co., 298 F. 2d 644 ; International Union of Elec., Radio & Mach. Workers v. General Elec. Co., 332 F. 2d 485 ; Matter of Carey v. General Elec. Co., 315 F. 2d 499 , 377 U. S. 908 ; Matter of Carey v. Westinghouse Elec. Corp., 375 U. S. 261 ; Fibreboard Corp. v. Labor Bd., 379 U. S. 203 ; Matter of International Assn. of Machinists [Cutler-Hammer, Inc.], 271 App. Div. 917 , 297 N. Y. 519 .) II. The subject matter of the grievances has not been expressly and unambiguously excluded from arbitration.

In 1960, the United Electrical, Radio and Machine Workers and the General Electric Company entered into a “ national ” collective bargaining agreement which covered janitors, porters and charwomen in several of the company’s plants including one in Baltimore, Maryland, and another in Hudson Falls-Fort Edward, New York. The agreement provides for grievance procedures (art. XVI) and, if those procedures prove unsuccessful, for arbitration by the American Arbitration Association (art. XVII). More specifically, article XVII recites that ‘[1] Any grievance which remains unsettled after having been fully processed * * * and which involves * * * the interpretation or application of a provision of this Agreement * * * shall be submitted to arbitration upon written request of either the Union or the Company ’ ’. However, it also provides that, if either party shall advise the American Arbitration Association that a particular grievance does not raise “ an arbitrable issue ”, the Association may not go forward with the arbitration until a court has first determined that the grievance is arbitrable (art. XVII, § 2, subd. [b]).

On January 10, 1961, the Baltimore local (Local 120) presented a grievance charging that the company had violated the agreement by taking work away from janitors, porters and charwomen in its Baltimore plant and contracting for the per

p. 329
formance of such work by individuals employed by an independent janitorial concern. About two months later, on March 2, 1961, the Hudson Falls-Fort Edward local (Local 332) initiated a similar grievance complaining of the same practice at the company’s Hudson Falls-Fort Edward plant. In both instances, the grievance procedure was duly exhausted and the union requested arbitration. The company, however, refusing to arbitrate, advised the Arbitration Association that the grievances did not raise an arbitrable issue, whereupon the union instituted the present proceeding to compel arbitration.

The court at Special Term dismissed the petition on the ground that “ the dispute * * * does not involve interpretation or application of any provision of the collective bargaining agreement ”. The Appellate Division, one justice dissenting, reversed, declaring that, in the absence of clear language excluding the dispute in issue from arbitration, the matter was to be deemed arbitrable.

Our function on this appeal is limited to ascertaining simply whether there is an arbitrable dispute for, if such a dispute exists, whether tenable or not, it must be submitted to the arbitrator. (See Steelworkers v. American Mfg. Co., 363 U. S. 564 , 566-567; Steelworkers v. Enterprise Corp., 363 U. S. 593 , 596; Matter of Long Is. Lbr. Co. [Martin], 15 N Y 2d 380 , 384-385; see, also, CPLR 7501.) And, since we are dealing with an industry affecting interstate commerce, all questions arising under this collective bargaining agreement are to be determined under Federal law (Labor Management Relations Act, § 301, subd. [a]; U. S. Code, tit. 29, § 185, subd. [a]; see Teamsters Local 174 v. Lucas Flour Co., 369 U. S. 95 , 102) which, we note at the outset, raises a presumption of arbitrability. (See Steelworkers v. Warrior & Gulf Co., 363 U. S. 574 , 582-583; Matter of Long Is. Lbr. Co. [Martin], 15 N Y 2d 380 , 384-385, supra.) As we observed in the Martin case (15 N Y 2d, at p. 385) —where Federal law was applied—“ It is only where the parties have employed language which clearly rebuts [such] presumption of arbitrability, e.g., by stating that an issue either as to procedure or as to substance is not to be determined by arbitration, that the matter may be determined by the courts. In the absence of such unmistakably clear language * # * the matter is sent to the arbitrator for his determination on the merits.”

p. 330
(See, also, Steelworkers v. Enterprise Corp., 363 U. S. 593 , supra.)

In our view, the union’s grievances present arbitrable issues as to the “interpretation or application” of the recognition (art. I) and layoff (art. XII) provisions of the collective bargaining agreement.

The company having agreed in article I “ to recognize the Union [as the] exclusive bargaining representative” of all cleaning employees at the two plants involved, it is for the arbitrator to “ interpret ” and “apply” the recognition provision to ascertain whether the contracting out of the bargaining unit work violates that provision. The position of the company is not advanced by its argument that the recognition provision merely sets forth the statutory obligation of the company to recognize the union. Even if he finds that the clause was inserted for that purpose, the arbitrator is required, nevertheless, to determine the meaning and scope of that obligation. More specifically, he must decide (1) whether it was fully carried out by the mere act of executing the agreement or (2) whether — in order to assure that the employees are not deprived of their contractual benefits — it imposes upon the employer the continuing duty of assigning work customarily performed in the plant to members of the union instead of to individuals employed by an outside contractor. (See Fibreboard Corp. v. Labor Bd., 379 U. S. 203 , 211-212; see, also, Crawford, The Arbitration of Disputes Over Subcontracting, Proceedings from the Thirteenth Annual Meeting, National Academy of Arbitrators [1960], p. 51 et seq.)

The union’s grievances also raise a question of interpretation or application of the layoff provision, article XII, which applies to “ all cases of layoff or transfer due to lack of work”. No claim is made that there was here any lack of work to be performed by janitors, porters or charwomen. On the contrary, such work will continue to be performed in these plants but by persons who are neither members of the union nor employees of General Electric. In such a situation, where bargaining unit employees are laid off and other persons are hired to do the same work formerly performed by union members, an arbitrable question is presented whether, within the meaning of the layoff provision of article XII, there was a “ lack of work ”.

p. 331
In point of fact, the very parties now before us have already litigated in a case involving an arbitration clause which, as the record there establishes, not only was identical with that here under consideration but actually included the same precise provision for initial judicial determination of arbitrability. In International U. of Elec., R. & M. Wkrs. v. General Elec. Co. ( 332 F. 2d 485 , cert. den. 379 U. S. 928 , called the Bridgeport case), the United States Court of Appeals for the Second Circuit held that a grievance relating to contracting out of work “ certainly called into question the proper interpretation to be accorded several provisions of [the] collective bargaining agreement ” (p. 488). The court was there concerned with subcontracting of new construction, much of which the members of the bargaining unit were unable to perform, whereas here we are dealing with contracting out of cleaning services which could have been performed, and customarily were, by members of the union. If anything, therefore, the case before us is an even stronger one for arbitration than Bridgeport.[1]

The company contends that the collective bargaining history between the parties shows that they intended to exclude contracting out from arbitration. Such evidence—which bears on the merits of the dispute — is irrelevant to the issue here presented as to whether the dispute is arbitrable. Similar evidence of collective bargaining history was ignored by the Supreme Court in the Warrior é Gulf case when it held that a contracting-out grievance was arbitrable. As the Court of Appeals for the Second Circuit declared in the Bridgeport case (332 F. 2d, at p. 490), when it refused to consider such evidence, “ while this bargaining history may prove very useful to an arbitrator in examining this grievance to determine whether the company has violated any provision of the contract by its subcontracting of work, it is of no legitimate use to a court in

1 The United States Court of Appeals for the Seventh Circuit has reached a conclusion at odds with that reached by the Second Circuit in the Bridgeport ease. (See Petroleum Workers v. American Oil Co., 324 F. 2d 903 , affd. by an equally divided court 379 U. S. 130 ; Local U. No. 483, Int. Bro. of Boilermakers v. Shell Oil Co., 369 F. 2d 526 .) We decline to follow these Seventh Circuit -decisions, since we believe them to be in conflict with that of the Supreme Court in the Warrior & Gulf case ( 363 U. S. 574 , supra) to the extent that arbitration was denied.

p. 332
deciding whether to order the company to .submit the grievance to an arbitrator.”

The order appealed from should be affirmed, with costs.

Judges Burke, Bergan and Keating concur with Chief Judge Fuld ; Judges Van Voorhis and Scileppi dissent and vote to reverse upon the dissenting opinion at the Appellate Division; Judge Breitel taking no part.

Order affirmed.

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