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Brown & Pipkins, LLC v. Service Employees International Union

United States Court of Appeals, Fourth Circuit

January 23, 2017

BROWN & PIPKINS, LLC, d/b/a Acsential Services, Plaintiff - Appellant,
SERVICE EMPLOYEES INTERNATIONAL UNION, LOCAL 32BJ, Defendant-Appellee. BROWN & PIPKINS, LLC, d/b/a Acsential Services, Plaintiff - Appellee,

          Argued: October 26, 2016

         Appeals from the United States District Court for the Eastern District of Virginia, at Alexandria. Claude M. Hilton, Senior District Judge. (1:15-cv-00526-CMH-TCB)

         Affirmed by published opinion. Judge Diaz wrote the opinion, in which Judge King and Judge Keenan joined.


          Stephen Gregory Joy, SMITH, CURRIE & HANCOCK LLP, Washington, D.C., for Appellant/Cross-Appellee.

          Andrew Lee Strom, SEIU, LOCAL 32BJ, New York, New York, for Appellee/Cross-Appellant.

         ON BRIEF:

          Stephen J. Kelleher, SMITH, CURRIE & HANCOCK LLP, Washington, D.C., for Appellant/Cross-Appellee.

          Before KING, KEENAN, and DIAZ, Circuit Judges.

          DIAZ, Circuit Judge.

         Brown & Pipkins, LLC, doing business as Acsential Services ("B&P") appeals the district court's confirmation of four labor arbitration awards, and Service Employees International Union, Local 32BJ cross-appeals for attorneys' fees after the district court failed to address its entitlement to fees. We affirm the confirmation of the arbitration awards, based in large part upon the limited scope of our review of a labor-arbitration decision pursuant to a collective bargaining agreement (a "CBA"), and hold that the Union waived its claim for attorneys' fees by not complying with Federal Rule of Civil Procedure 54.



         In September 2012, B&P began providing janitorial services for the Department of the Army at Fort Belvoir in Fairfax County, Virginia. Janitorial employees worked without a CBA until May 17, 2013, when B&P and the Union signed a CBA which recognized the Union as the exclusive bargaining representative for B&P's janitorial employees at Fort Belvoir. The CBA was retroactive to September 4, 2012.

         In the spring and summer of 2013, the Union filed notices that it intended to arbitrate four separate grievances with B&P related to alleged violations of the CBA. The parties chose Arbitrator Garvin Lee Oliver to hear each grievance, and no transcripts were taken at the hearings. We describe relevant parts of the grievances and corresponding arbitration awards seriatim.


         On May 29, 2013, the Union filed a grievance alleging that B&P violated the CBA by reducing the full-time work schedule from 40 to 35 hours per week on January 16, 2013. The Shop Steward spoke with B&P management about the reduction in hours on the same day that B&P announced the change, but B&P would not recognize the Union or discuss grievance issues. B&P claimed that it cut employees' hours as a result of a decision by the Army to decrease funding for the B&P contract from approximately $177, 903 per month to approximately $154, 500 per month.

         The arbitrator granted the grievance in part and issued what we refer to as the Hours Reduction Award. In granting the grievance, the arbitrator weighed conflicting provisions in the CBA. Article 3 of the CBA, titled "Management Rights, " comprises three Sections which, in sweeping language, vest certain "rights, prerogatives, and functions" in B&P. J.A. 261. Relevant here, Article 3, Section 2 reserves to B&P the right to "adjust schedules of work and work assignments based on its judgment of business requirements, " and Article 3, Section 3 provides that "[s]uch managerial right[s] shall not be the subject of any provision of the Agreement or of mandatory bargaining between" B&P and the Union. J.A. 261. But Article 6 of the CBA, titled "Hours of Work, " also addresses the scheduling of work. Article 6, Section 1 provides: "An employee who is regularly schedule[d] for thirty five (35) hours or more per week shall be consider[ed] full time. The workweek for all full time employees shall be 40 hours per week, 8 hours per day, Monday through Friday." J.A. 263.

         The arbitrator reconciled these provisions by reasoning that "Article [3], Sections 2 and 3 gave [B&P] the general right to schedule work . . . but Article 6, Section 1 impliedly restricted [B&P's] right to schedule work relating to the duration of work for full time employees." J.A. 48. Accordingly, the arbitrator held that B&P "violated Article 6, Section 1 of the [CBA] on January 16, 2013 when it reduced the work day by one hour for all janitorial full time employees." J.A. 48.

         The arbitrator also rejected B&P's argument that the grievance was procedurally defective because the Union failed to comply with the CBA's Grievance and Arbitration Procedure. Article 11, Section 2 of the CBA splits the Grievance and Arbitration Procedure into three Steps, relevant parts of which we reproduce here:

Step 1[:] The Shop Steward must discuss the grievance with the project manager within three (3) days of the incident. [B&P] shall render a decision in writing within twenty-four (24) hours after the conclusion of Step 1.
. . . .
Step 3: Arbitration: . . . .
. . . .
The Arbitrator shall have jurisdiction and authority to apply, interpret and determine compliance with the terms of this Agreement, but in no case add to, deviate from, detract from or alter in any way the provision of the Agreement.

J.A. 266-67.

         The arbitrator began by noting that the Union had failed to abide by Step 1's three-day limit to discuss grievances, as the parties, with B&P's reserving its right to bring a timeliness challenge, "agreed to consider the [May 29, 2013] grievance initiation letter as [S]tep 1 of the grievance procedure." J.A. 47. Nevertheless, the arbitrator reasoned that it would have been "unreasonable to require strict compliance with the time limits" in this case. J.A. 48. In particular, the arbitrator identified two "mitigating circumstances": (1) the National Labor Relations Board was "processing" a dispute between the Union and B&P regarding the "processing of grievances prior to the" adoption of the CBA in 2012, and (2) the violation was of a "continuing nature." J.A. 47-48.

         The Hours Reduction Award orders B&P to, inter alia, restore the 40-hour workweek for full-time janitorial employees and pay employees for any lost hours incurred while the 35-hour workweek was in effect.


         On July 12, 2013, the Union filed a grievance alleging that B&P violated the CBA by paying two employees, Alicia Duran and Susana Cortez, at the "Custodians" rate instead of at the higher "Custodian/Driver" rate commensurate with their responsibilities. The arbitrator granted the grievance and issued what we refer to as the Drivers' Pay Award.

         Article 16 of the CBA lists three wage classifications, including "Custodians" and "Custodian/Driver, " but does not define them other than by providing corresponding rates of pay. "Custodian/Drivers" are paid $0.60 more per hour than "Custodians."

         The arbitrator traced the origins of the "Custodian/Driver" classification to a letter of understanding that the Union and one of B&P's predecessors at Fort Belvoir negotiated in 2008. That letter of understanding provided that the predecessor would pay "$0.60 per paid hour more to the custodial service workers who drive our vehicles in order to transport workers to various sites." J.A. 135. The arbitrator found that the letter of understanding was the "genesis" for, and thus informed the definition of, the "Custodian/Driver" classification. The arbitrator noted that the rate appeared in previous CBAs between the Union and B&P's predecessors, and that those predecessors had paid employees at that rate when they had transported workers to their worksites, brought equipment to their worksites, and driven to multiple locations within Fort Belvoir.

         The arbitrator then examined the type of work that B&P assigned to Duran and Cortez. He found that B&P assigned them to schedules that "included multiple buildings, some of which were far apart, " and "required [them] to alternate driving themselves and another custodian . . . in their own personal vehicles to the buildings they were required to clean." J.A. 53. Additionally, he found that B&P required them to "carry equipment from the office to these buildings, " and that B&P generally refused to provide ...

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