REVISED United States Court of Appeals,
Fifth Circuit.
No. 96-50881.
Jennell L. BRANSON, Plaintiff-Appellant,
v.
GREYHOUND LINES, INC., AMALGAMATED COUNCIL RETIREMENT AND DISABILITY PLAN; Greyhound Lines, Inc., Defendants-Appellees.
Oct. 30, 1997.
Appeals from the United States District Court for the Western District of Texas.
Before JONES, EMILIO M. GARZA and PARKER, Circuit Judges.
EMILIO M. GARZA, Circuit Judge:
Jennell L. Branson appeals from the district court's order
dismissing his claims against Greyhound Lines, Inc. ("Greyhound" or
"GLI") and Greyhound Lines, Inc., Amalgamated Council Retirement
and Disability Plan (the "Plan"). The district court held as a
matter of law that Branson's breach of contract claim against
Greyhound was preempted by section 8 of the National Labor Relations Act ("NLRA"), 29 U.S.C. § 158, and section 301 of the
Labor Management Relations Act ("LMRA"), 29 U.S.C. § 185. We
reverse the district court's preemption ruling and remand for
action consistent with this opinion.
The district court further ruled that the Plan Trustees did
not abuse their discretion under the Employees' Retirement Income
Security Act ("ERISA"), 29 U.S.C. § 1132(a)(1)(B), by rejecting
Branson's claim for additional seniority credit. We affirm.
1 I
Branson began working for Greyhound in May 1977 and remained
an employee of the company until July 1987, when he resigned to
take another job. At the time of Branson's voluntary termination,
he was covered by the 1987 collective bargaining agreement ("1987
CBA"), negotiated between Greyhound and the Amalgamated Transit
Union (the "Union"). Branson's 10.18 years of service entitled him
to certain vested, non-forfeitable pension rights under the Plan,
which continues to exist as a legal entity separate and apart from
Greyhound and the Union. Branson later returned to work for
Greyhound as a replacement employee in April 1990, about a month
into a bitter strike.
By the time Branson returned to work for Greyhound, the most
recent collective bargaining agreement (the 1987 CBA) had expired,
and negotiations toward a new collective bargaining agreement were
proceeding. Greyhound also had recently introduced a new term in
its negotiations with the Union, essentially designed to encourage
experienced drivers to cross the picket line. Greyhound labeled
this new term "Experience Based Seniority" or "EBS", and it
promised Greyhound seniority credit for any past commercial driving
experience. Greyhound informed the Union that it would not abandon
this program under any circumstances and began implementing EBS
without further negotiations. Shortly thereafter, the Union filed
an unfair labor charge with the National Labor Relations Board
("NLRB" or "Board") based on the implementation of EBS.
Following Branson's return to work, he filled out a standard
2 form by which he requested seniority credit not only for his prior
work with Greyhound, but also for driving experience gained from
other firms. Because Branson had worked only part-time for these
other companies, however, Greyhound granted Branson credit only for
his prior Greyhound service.
The grants of EBS "super-seniority" to replacement workers and
returning strikers became a major issue in the continuing
negotiations between Greyhound and the Union. Even when Greyhound
and the Union at last succeeded in signing a new collective
bargaining agreement ("1993 CBA"), they inserted a provision
leaving the resolution of EBS to the NLRB. The Board later found
EBS to be an unfair labor practice and ordered Greyhound to
"eliminate all effects of EBS by all appropriate means." Greyhound
subsequently began an EBS "buy-out" program, whereby the Company
offered cash payments to those employees that had earned EBS in
exchange for their signing a standard waiver form.
Branson refused to sign the waiver, insisting that he wanted
his additional seniority credit rather than the cash buy-out.
Thereafter, Branson brought suit against the Plan in federal court,
seeking declaratory relief setting forth his rights under the Plan
as provided in ERISA, 29 U.S.C. § 1132(a)(1)(B). Because Branson
had not submitted his claim to the Plan Trustees before filing
suit, the trial court granted a joint request to modify the
scheduling order to permit exhaustion. The district court held the
cause in abeyance while Branson exhausted his administrative
remedies. The Plan Trustees subsequently held that Branson could
3 not accumulate additional seniority credit under the Plan beyond
his already vested 10.18 years. In the meantime, Branson amended
his complaint to include a breach of contract claim against
Greyhound based on the alleged promise of seniority.
Branson then tried his case to the district court. At the
close of Branson's presentation of evidence, the district court
dismissed Branson's breach of contract claim against Greyhound on
preemption grounds. The bench trial continued with respect to the
Plan. Following the trial, the district court ruled in favor of the
Plan, finding that the Trustees did not abuse their discretion in
interpreting the Plan to deny Branson additional seniority credit
after his termination in 1987. Branson's timely appeal followed.
II
At the close of Branson's presentation of evidence, the
district court granted judgment as a matter of law in favor of
Greyhound on the grounds that both the NLRA and the LMRA preempted
Branson's breach of contract claim. Branson timely appealed the
district court's order on both grounds.1 We review de novo the
district court's rulings on preemption. Baker v. Farmers Elec.
Coop., Inc., 34 F.3d 274, 278 (5th Cir.1994).
A
In order to preserve the primary jurisdiction of the NLRB,
the NLRA requires that courts not regulate activities "when it is
1 Because we reverse the district court's judgment as to the breach of contract claim against Greyhound, we do not address Branson's claim that the district court erred in granting judgment for Greyhound without adequate notice and without making findings of fact.
4 clear or may fairly be assumed that [such] activities ... are
protected by § 7 of the National Labor Relations Act, or constitute
an unfair labor practice under § 8." San Diego Bldg. Trades Council
v. Garmon, 359 U.S. 236, 244, 79 S.Ct. 773, 779, 3 L.Ed.2d 775
(1959); accord Belknap, Inc. v. Hale, 463 U.S. 491, 498, 103 S.Ct.
3172, 3177, 77 L.Ed.2d 798 (1983); Windfield v. Groen Div., Dover
Corp., 890 F.2d 764, 767 (5th Cir.1989). Here, Branson seeks to
recover for Greyhound's alleged breach of a promise to restore
Branson's previously acquired seniority.
The first prong of Garmon preemption requires us to decide
whether Branson bases his claim on an activity "protected by
section 7" of the NLRA. Garmon, 359 U.S. at 244, 79 S.Ct. at 779.
Section 7 protects the rights of employees to organize, strike, and
collectively bargain. 29 U.S.C. § 157. Branson's claim, however,
relies on his employer's alleged breach of contract. Because the
employer's alleged breach of contract does not constitute "activity
protected by section 7," the first prong of Garmon preemption does
not apply.
The second prong of Garmon preemption requires us to decide
whether Branson's claim involves an activity actually or arguably
forbidden under section 8 of the NLRA, which prohibits employers
from engaging in unfair labor practices. Garmon, 359 U.S. at 244,
79 S.Ct. at 779, 29 U.S.C. § 158. Branson argues that his claim
arises solely under an individual promise, unrelated to GLI's
implementation of EBS, and therefore involves no terms of
employment arguably regulated by section 8. Whether Branson's
5 seniority is or is not EBS, however, does not prove dispositive.
Certainly if Branson's claims do not involve the EBS program, no
colorable argument exists for NLRB jurisdiction. See Belknap, 463
U.S. at 512, 103 S.Ct. at 3184 (holding that federal law does not
preempt replacement employees from suing in state court for an
employer's breach of individual promises of permanent employment).
Yet our holding of no preemption remains the same even if
Branson's claims do involve EBS. The Supreme Court said as much in
Belknap, where individual replacement employees succeeded in
maintaining their state law breach of contract claims against a
company which promised them permanent employment but then fired
them to make room for returning strikers. 463 U.S. at 495-497, 103
S.Ct. at 3175-3177. There the Court explicitly rejected the
employer's contention that the employees' breach of contract suit
was preempted "because it related to ... conduct that was part and
a parcel of an arguable unfair labor practice." Id. at 510, 103
S.Ct. at 3183. Recognizing that "whether the strike was an unfair
labor practice strike and whether the offer to replacements was the
kind of offer forbidden during such a dispute were matters for the
Board," the Court nevertheless noted that in making these
determinations, "the Board would be concerned with the impact on
strikers not with whether the employer deceived replacements." Id.
Thus, the state law causes of action were not preempted by the NLRA
because they were "of no more than peripheral concern to the Board
and the federal law ... while [the state] surely [had] a
substantial interest in protecting its citizens from
6 misrepresentations that have caused them grievous harm." Id. at
511, 103 S.Ct. at 3183.
GLI seeks to distinguish Belknap on the grounds that "Belknap
did not involve a breach of contract claim based on a term of
employment concerning a mandatory subject of bargaining (seniority)
unilaterally implemented by an employer upon an impasse in
bargaining negotiations." As an initial matter, we note that
Greyhound has failed to demonstrate whether impasse in fact
occurred before the implementation of EBS, a finding necessary to
complete Greyhound's alleged distinction. More fundamentally,
however, Belknap indeed did involve a term of employment (whether
the position was permanent or temporary) concerning a mandatory
subject of bargaining (reinstatement of strikers) unilaterally
implemented by an employer upon an impasse in bargaining
negotiations. See Belknap, 463 U.S. at 493-496, 103 S.Ct. at 3174-
3176.
GLI more correctly observes that Belknap did not involve
either an NLRB unfair labor practice finding or a specific order
issued by the NLRB because the parties settled their differences
before such a decision could issue. Nevertheless, Belknap
addressed that very argument by noting that even in the face of an
explicit Board order directing an employer to violate contracts
made with replacement workers, "the suit for damages for breach of
contract could still be maintained without in any way prejudging
the jurisdiction of the Board or the interest of the federal law in
insuring the replacement of strikers." 463 U.S. at 512, 103 S.Ct.
7 at 3184.
The Supreme Court faced a similar issue in J.I. Case v. NLRB,
321 U.S. 332, 64 S.Ct. 576, 88 L.Ed. 762 (1944). There the Court
ordered an employer not to enforce individual employment contracts
that forestalled collective bargaining or deterred
self-organization. 321 U.S. at 341-42, 64 S.Ct. at 582.
Nonetheless, the Court specifically preserved the right of the
employees to seek damages for the breach of their individual
agreements. Id.
GLI also makes much of Bassette v. Stone, 25 F.3d 757 (9th
Cir.1994), cited by the district court for the proposition that
Branson may have been able to bring his claim under section 8 of
the NLRA. Bassette does hold that in addition to "limiting
employers in which terms they may implement after impasse, section
8 requires that employers honor those terms once they are
implemented ... the latter duty follow[ing] from the former." 25
F.3d at 761. In Bassette, however, the court confronted the claims
of an employee represented under the expired collective bargaining
agreement, who continued to work during negotiations over a new
collective bargaining agreement and whose claim rested on a
unilaterally implemented term validly implemented under section 8.
Whether or not we should accept Bassette generally is a
question we leave for another day. At the very least, however, we
decline to apply Bassette on the facts currently before us, where
a replacement employee has challenged the breach of a promise
arguably based on a unilaterally implemented term that the NLRB
8 already has determined violates section 8. Applying Bassette in
this way would create an unacceptable incoherence in the duties
required by section 8. It cannot both be an unfair labor practice
to refuse to honor an implemented term and then also an unfair
labor practice to continue to honor that same term.
In addition, simply labeling a term of employment
"unilaterally implemented" cannot transform replacement workers
into participants in the collective bargaining process. See
Service Elec. Co., 281 N.L.R.B. 633, 641 (1986) (holding that
employer has no duty to negotiate with the union regarding the
terms and conditions of the replacements' employment); Leveld
Wholesale, Inc., 218 N.L.R.B. 1344, 1350 (holding that union's duty
of fair representation does not interfere with its ability to
insist during negotiations that an employer terminate replacements
to make room for returning strikers). These replacement workers
come to work when no collective bargaining agreement is in effect,
and they work under conditions that have not been collectively
bargained for their benefit. See Service Elec., 281 N.L.R.B. 633;
Leveld, 218 N.L.R.B. at 1350 ("Strike replacements can reasonably
foresee that, if the union is successful, the strikers will return
to work and the strike replacements will be out of a job."); cf.
Belknap, 463 U.S. at 513-514, 103 S.Ct. at 3184-3185 (Blackmun, J.,
concurring) ("During settlement negotiations, the union can be
counted on to demand reinstatement for returning strikers as a
condition for any settlement.").
To assert that such replacement workers must bring their
9 claims to the NLRB rather than to an appropriate court, seems to
vest this federal administrative body with power over disputes
purely private and independent of an unfair labor practice or
collective bargaining agreement. See 29 U.S.C. § 160 ( giving
Board jurisdiction only to prevent any person from engaging in any
unfair labor practice); see also National Licorice v. NLRB, 309
U.S. 350, 366, 60 S.Ct. 569, 578, 84 L.Ed. 799 ("the National Labor
Relations Act contemplates no more than the protection of the
public rights which it creates and defines"). Federal labor law
may create in represented employees a certain expectation and
interest that an employer will abide by terms properly and
unilaterally implemented during negotiations over a collective
bargaining agreement. See Bassette, 25 F.3d at 760. Nevertheless,
the expectations of replacement employees, who trust that an
employer will keep its promises, stem from the different and more
traditional source of state contract law. See Belknap, 463 U.S. at
507, 103 S.Ct. at 3181 (holding that even if replacement employees
are "represented" by the Union in some technical sense, and thus
governed by whatever settlement the Union negotiates to end the
strike, this cannot change the Court's holding in J.I. Case that
such currently "represented" employees may sue for damages on their
non-collective contracts); see also Caterpillar Inc. v. Williams,
482 U.S. 386, 396, 107 S.Ct. 2425, 2431-32, 96 L.Ed.2d 318 (1987)
(finding that a state-law plaintiff may be covered by a collective
bargaining agreement, but still may have independent contract
rights arising under state law).
10 The remainder of GLI's arguments for affirming the district
court's finding of preemption relates to the possibility that a
court might order GLI to behave in a manner contrary to the NLRB's
decision. As Belknap makes clear, however, "it will not be open to
any tribunal to compel the employer to perform the acts, which,
even though he has bound himself by contract to do them, would
violate the Board's order or be inconsistent with any part of it."
Belknap, 463 U.S. at 512 n. 13, 103 S.Ct. at 3184 n. 13 (quoting
National Licorice Co. v. NLRB, 309 U.S. at 365, 60 S.Ct. at 577).
GLI fails to recognize the flip side of this statement, that
although no tribunal may order specific performance in the face of
a contrary NLRB order, proper tribunals nonetheless may award
damages for that very breach "without in any way prejudicing the
jurisdiction of the Board or the interest of the federal law in
insuring the replacement of strikers." Belknap, 463 U.S. at 512,
103 S.Ct. at 3184. J.I. Case makes a similar distinction,
providing that its order for the employer to bargain collectively,
despite the existence of non-expired individual contracts, is
"without prejudice to the assertion of any legal rights the
employee may have acquired under such contract or to any defenses
there-to by the employer." 321 U.S. at 342, 64 S.Ct. at 582.
Because Branson's breach of contract claim is not based on
activity arguably protected or prohibited under the NLRA, it is not
preempted under Garmon.
B
The district court also held that section 301 of the LMRA
11 preempted Branson's breach of contract claim because a resolution
of the relevant allegations would depend on the analysis of one or
more collective bargaining agreements. Because Branson bases his
breach of contract claim on either the 1990 EBS program
unilaterally implemented by GLI or a separate individual promise
made to Branson, we disagree.2
The district court's ruling on preemption is a question of
law which we review de novo. Baker v. Farmers Elec. Coop., Inc.,
34 F.3d 274, 278 (5th Cir.1994). Section 301 preempts state causes
of action that allege the violation of a collective bargaining
agreement affecting interstate commerce. Allis-Chalmers Corp., 471
U.S. at 210, 105 S.Ct. at 1911; Eitmann v. New Orleans Public
Serv., Inc., 730 F.2d 359, 361-62 (5th Cir.1984). When the
resolution of a state law claim substantially depends on the
meaning of a collective bargaining agreement, courts must treat the
claim as one made under section 301 or dismiss it as preempted by
federal labor law. Allis-Chalmers, 471 U.S. at 220, 105 S.Ct. at
1916; Thomas v. LTV Corp., 39 F.3d 611, 617 (5th Cir.1994).
Nonetheless, section 301 does not necessarily preempt every state
law claim between the parties to a collective bargaining agreement,
nor does it preempt claims only tangentially related to such an
2 In earlier proceedings, Branson made an alternative argument that "if for some reason the 1990 agreement should prove to be invalid, then Mr. Branson would nevertheless be entitled to his seniority under the plain and unmistakable language of the [1993] collective bargaining agreement itself." Because Branson does not reassert this argument in his briefs on appeal, it is waived. See Zuccarello v. Exxon Corp., 756 F.2d 402, 407-08 (5th Cir.1985); FED. R. APP. P. 28.
12 agreement. Lingle v. Norge Div. of Magic Chef, Inc., 486 U.S. 399,
409-11, 108 S.Ct. 1877, 1883-85, 100 L.Ed.2d 410 (1988); Allis-
Chalmers, 471 U.S. at 211-12, 105 S.Ct. at 1911-1912; Thomas, 39
F.3d at 617.
In the instant case, GLI claims that resolution of Branson's
breach of contract claim depends on the interpretation of the 1987
CBA. We disagree. Greyhound concedes that at the time Branson
retired in 1987, he had accumulated 10.18 years of seniority under
the 1987 CBA. Deciding whether or not GLI made a subsequent promise
in 1990 to credit Branson with that amount of seniority, whether
Branson relied on such a promise, and whether GLI breached such a
promise will not require the interpretation of the 1987 CBA and
thus cannot support a finding of preemption. See Lingle, 486 U.S.
at 413, 108 S.Ct. at 1885 (holding that section 301 preempts "an
application of state law ... only if such application requires the
interpretation of a collective bargaining agreement").
GLI also claims that a court would have to consider the 1993
CBA's seniority provision "to consider the merits of the parties'
dispute as to the nature of Branson's seniority." The seniority
provision of the 1993 CBA, however, contains no precise definition
of EBS, nor does it clarify whether EBS contemplated the extension
of seniority credit only for non-Greyhound driving experience.
Even if it did, what Greyhound and the Union say in 1993 (in the
CBA) about what Greyhound and Branson agreed to in 1990 cannot
alter the analysis of the 1990 agreement itself (unless one argues
that the 1993 agreement supersedes the one made in 1990, an
13 argument addressed and rejected below). Thus, if and when a court
attempts to resolve the merits of this dispute over the nature of
the seniority allegedly promised to Branson in 1990, interpreting
the 1993 CBA will not prove necessary or useful.
GLI additionally claims that a court must consider the 1993
CBA's seniority provision "to consider GLI's defense that validity
of its action is based on the NLRB's order." We disagree. While
GLI indeed may attempt to use the NLRB order as a defense to the
state contract claim, section 301 does not provide for the
preemption of claims that might involve the interpretation of an
NLRB order. See Belknap, 463 U.S. at 512, 103 S.Ct. at 3184.
Simply pointing out that the 1993 CBA anticipates the issuing of
such an order cannot transform GLI's defense into one based on the
1993 CBA.3 To the extent that such a defense would implicate the
1993 CBA at all, it would do so only tangentially, and thus would
not preempt the underlying state claim.4 See Allis-Chalmers, 471
3 The 1993 CBA anticipates an NLRB order because Greyhound and the Union explicitly agreed to leave the resolution of EBS to the NLRB and to abide by whatever decision the NLRB made. 4 The Supreme Court faced, but refused to decide, a similar issue in Caterpillar Inc. v. Williams, where former employees brought a breach of contract suit in state court against their former employer based on alleged individual employment contracts. Caterpillar Inc. v. Williams, 482 U.S. 386, 107 S.Ct. 2425, 96 L.Ed.2d 318 (1987). The employer sought to remove the case to federal court, arguing that its intent to raise a collective bargaining agreement as a defense mandated preemption under section 301. Id. at 390, 107 S.Ct. at 2428. Because of the procedural posture of the case—whether or not removal of the state claims to federal court was appropriate—the Supreme Court expressly declined to rule on the merits of the preemption issue. 482 U.S. at 398 n. 13, 107 S.Ct. at 2433 n. 13. Nonetheless, the Court expressly held that section 301 does not so "completely preempt" a state law claim for breach of contract that simply raising a collective bargaining
14 U.S. at 211, 105 S.Ct. at 1911 ("not every dispute concerning
employment, or tangentially involving a provision of a
collective-bargaining agreement, is pre-empted by § 301").
GLI also argues that section 301 preempts Branson's breach of
contract claim because the alleged individual seniority agreement
seeks to limit or condition the 1993 CBA. Yet each of the cases
that Greyhound cites for this proposition concern individual
agreements made in the context of currently binding collective
bargaining agreements. See Thomas, 39 F.3d at 617-18; Eitmann,
730 F.2d at 363. In Thomas, we held that an individual attendance
probation agreement negotiated by the employee, his union, and the
employer that set forth minimum attendance requirements for the
year and modified the discharge procedures of the existing CBA,
would be treated as a CBA for section 301 preemption purposes.
Thomas, 39 F.3d at 614-17. In Eitmann, we found that where an
employer's pre-employment promises conflicted with the collective
bargaining agreement in effect at the date of hire, section 301
would preempt a state law claim based on that pre-employment
promise. 730 F.2d at 360-63.
Here, in contrast to the cases cited by Greyhound, at the time
agreement as a defense would merit removal. Id.; see also Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1, 24, 103 S.Ct. 2841, 2854, 77 L.Ed.2d 420 (1983)("[I]f a federal cause of action completely preempts a state cause of action any complaint that comes within the scope of the federal cause of action necessarily "arises under' federal law."). The Court noted that even when an employer-defendant alleges that a subsequent collective bargaining agreement supersedes the individual agreement at issue, section 301 does not necessarily mandate preemption. 482 U.S. at 394-97, 107 S.Ct. at 2430-32.
15 Branson allegedly struck his individual deal with Greyhound, the
1987 CBA had expired and the bargaining parties had yet to agree on
the 1993 CBA. In fact, Branson was a replacement employee and had
no interest in the CBAs. See Service Elec., 281 N.L.R.B. at 641
(employers have no duty to bargain with a striking union about
terms for replacement employees). Thus, because no collective
bargaining agreement governed at the time Branson and Greyhound
allegedly made their individual contract, we cannot find that
Branson's individual claim seeks to limit or condition a collective
bargaining agreement.
Whether or not the 1993 CBA supersedes the alleged individual
agreement, even though made outside the context of a binding
collective bargaining agreement, presents a different issue. GLI
relies on J.I. Case for the proposition that collective bargaining
agreements must supersede and thus preempt individual employment
contracts. Yet while J.I. Case did state broadly that the "very
purpose of providing by statute for the collective agreement is to
supersede the terms of separate agreements of employees," see 321
U.S. at 338, 64 S.Ct. at 580, the Court also explicitly sought to
preserve the rights of employees to seek damages based on these
superseded individual contracts. See 321 U.S. at 342, 64 S.Ct. at
582.
The Supreme Court has attempted to correct this type of
erroneous interpretation before. In Caterpillar, the employer
"argue[d] that when respondents returned to the
collective-bargaining unit, their individual employment agreements
16 were subsumed into, or eliminated by, the collective bargaining
agreement." 482 U.S. at 395-96, 107 S.Ct. at 2431. With
unmistakable clarity, the Court responded:
Caterpillar is mistaken ... J.I. Case does not stand for the proposition that all individual employment contracts are subsumed into, or eliminated by, the collective-bargaining agreement.... Thus, individual employment contracts are not inevitably superseded by any subsequent collective agreement covering an individual employee, and claims based upon them may arise under state law.
482 U.S. at 396, 107 S.Ct. at 2431 (citations omitted).
"Caterpillar's basic error," continued the Court, "is its failure
to recognize that a plaintiff covered by a collective bargaining
agreement is permitted to assert legal rights independent of that
agreement, including state law contract rights, so long as the
contract relied upon is not a collective bargaining agreement."
Id. Whether Branson's claim for breach of contract arises out of a
purely individual agreement, as he alleges, or out of Greyhound's
unilateral implementation of EBS, as GLI alleges, no one posits
that his claim arises out of a contract that is itself a collective
bargaining agreement.5 GLI's arguments of supersession thus cannot
withstand appropriate scrutiny.
In its final plea for a finding of section 301 preemption, GLI
5 GLI does half-heartedly assert that the EBS provisions are the "functional equivalent" of a collective bargaining agreement for preemption purposes. We disagree. The 1990 contract terms were not a collectively bargained instrument, and were functionally distinct in many ways. See Thomas, 39 F.3d at 618 (defining collective bargaining as "bargaining by an organization or group of workmen on behalf of its members with the employer"). The terms were implemented unilaterally by GLI and were implemented three days after being presented to the union. Lastly, section 301 preempts claims that depend on a CBA, not its functional equivalent. Allis-Chalmers, 471 U.S. at 220, 105 S.Ct. at 1916.
17 notes that should Branson prevail on his breach of contract claim,
a court could not determine Branson's damages without looking to
the rates of pay included in the 1993 CBA, or the parameters of any
proper injunction without looking to the seniority provisions of
the 1995 modification. Assuming arguendo that this proposition is
true, it hardly establishes that Branson's underlying claim "is
substantially dependent upon" an analysis of the terms of a
collective bargaining agreement. Allis-Chalmers, 471 U.S. at 211,
105 S.Ct. at 1916. Indeed, the Supreme Court rejected this very
argument in Lingle, 486 U.S. at 413 n. 12, 108 S.Ct. at 1885 n. 12,
holding that while collective bargaining agreements may contain
information such as rates of pay, possibly helpful in determining
the damages due to a worker prevailing in a state-law suit, and
while "federal law would govern the interpretation of the agreement
to determine the proper damages, the underlying state-law claim,
not otherwise pre-empted, would stand."
GLI has presented no persuasive authority for the proposition
that section 301 preempts Branson's breach of contract claim.
III
Branson appeals the district court's decision in favor of the
Plan on two grounds: first, Branson argues that the district court
erred in using the abuse of discretion standard to review the
Trustees' interpretation; and second, he argues that the Trustees'
interpretation was nonetheless an abuse of discretion. We disagree
on both counts.
The district court applied an abuse of discretion standard
18 because it found that the Plan conferred discretionary authority on
the Trustees. See Firestone Tire & Rubber Co. v. Bruch, 489 U.S.
101, 115, 109 S.Ct. 948, 957, 103 L.Ed.2d 80 (1989); Chevron Chem.
Co. v. Oil, Chem. and Atomic Workers Local Union 4-447, 47 F.3d
139, 142 (5th Cir.1995). Whether the district court employed the
correct standard of review for analyzing the Trustees'
interpretation of the Plan is a question of law which we review de
novo. Chevron Chem., 47 F.3d at 142.
The district court must apply an abuse of discretion standard
only when the Plan itself confers discretionary authority on the
Trustees to interpret the Plan. See Firestone Tire, 489 U.S. at
115, 109 S.Ct. at 956-57 ( holding that "a denial of benefits ...
is to be reviewed under a de novo standard unless the benefit plan
gives the administrator or fiduciary discretionary authority to
determine eligibility for benefits or to construe the terms of the
plan"); Chevron Chem., 47 F.3d at 142. In Chevron Chem., we held
that the district court correctly used the abuse of discretion
standard where the pension plan conferred discretionary authority
in the following manner: "[T]he administrator is empowered to
"make such rules, regulations, [and] interpretations ... and [to]
take such other action ... as [he] may deem appropriate.' " 47
F.3d at 143 (emphasis and alterations in original) (quoting pension
plan).
In the case at hand, the Plan uses similar language to confer
discretionary authority upon the Trustees. Section 6.2 of the Plan
states that the Trustees have the power "[t]o decide any question
19 arising in the administration, interpretation, and application of
this Plan." Consequently, the district court correctly used the
abuse of discretion standard to review the decision of the
Trustees.
Branson argues, however, that the Trustees here are subject to
a "suspicion of partiality"6 and that the district court should
have used a sliding scale—something less than the abuse of
discretion standard—to review the Trustees' decision. See Lowry
v. Bankers Life and Casualty Retirement Plan, 871 F.2d 522, 525 &
n. 6 (5th Cir.1989) (suggesting the possibility of using a sliding
scale to review trustees' decision). We disagree.
The district court found, as a matter of fact, that no
animosity toward replacement workers influenced either Greyhound or
the Union. We review the district court's factual findings for
clear error. See Bellaire Gen. Hosp. v. Blue Cross Blue Shield, 97
F.3d 822, 829 (5th Cir.1996). Branson does not dispute that in
1990 the Union helped him correct Greyhound records to reflect his
actual starting date and that later, the Union pursued Branson's
grievance regarding a company decision to place him on sick leave
for an extended period of time. Under these circumstances, we
cannot say that the district court committed clear error in finding
no suspicion of partiality. Thus, the district court was correct
in refusing to use a suspicion of partiality as a factor in
6 Branson claims that the Plan operates under a conflict of interest because the Plan is managed by a six-member Board of Trustees, half chosen by the Union and half by Greyhound, none of whom have an interest in helping former strike-breakers.
20 determining whether the Trustees abused their discretion.
Branson additionally claims that the district court erred in
finding no abuse of discretion because: (1) the Trustees looked to
the 1987 CBA instead of the 1993 CBA to determine whether Branson
lost his seniority;7 and (2) even the 1987 CBA did not explicitly
state that Branson would lose his seniority when he quit. We
review de novo the district court's ultimate legal conclusion that
there was no abuse of discretion by the Trustees. See Sweatman v.
Commercial Union Ins. Co., 39 F.3d 594, 601 (5th Cir.1994).
A two-step inquiry governs whether the Trustees abused their
discretion in refusing to give Branson the additional seniority he
claimed. Pickrom v. Belger Cartage Serv., Inc., 57 F.3d 468, 471
(5th Cir.1995). First, we determine whether the Trustees gave the
Plan a "legally correct" interpretation. Id. Second, if we find
that the Trustees' interpretation is not legally correct, we must
determine whether the Trustees' decision constituted an abuse of
discretion. Id. In deciding the first step—whether the Plan's
interpretation was legally correct—we consider three factors: (1)
whether the Trustees have given the pension plan a uniform
construction; (2) whether the Trustees' interpretation is
consistent with a fair reading of the Plan; and (3) whether
different interpretations of the Plan will result in unanticipated
7 Branson also appears to argue that the Trustees should have looked to the 1990 Agreement implemented unilaterally by Greyhound to determine whether he lost his seniority. This argument ignores the fact that under section 11.1 of the Plan, any action taken by Greyhound without the concurrence of the Union can have no effect on the Plan.
21 costs. Id.; Chevron Chem., 47 F.3d at 145.
In the instant case, the first factor proves insignificant
because the Trustees have not previously interpreted the relevant
provisions. Although not determinative, the third factor of
unanticipated costs supports the Trustees. Indeed, the Trustees'
interpretation seems designed to thwart the very unanticipated
costs that Branson's interpretation inevitably would produce.
Particularly with employees like Branson, who have accumulated long
terms of seniority and then left the company, attempting to arrange
actuarially for the possibility that these employees might reenter
the Plan at any moment, demanding immediate recognition of
substantial terms of seniority, certainly results in unanticipated
costs.
The second factor, relating to whether or not the Trustees'
engaged in a "fair reading of the Plan," forms the basis of
Branson's argument that the Trustees' abused their discretion in
interpreting the Plan to deny him additional seniority credit. We
find, however, that the Trustees' interpretation is a fair reading
of the Plan.
Section 2.1 of the Plan provides:
Notwithstanding anything to the contrary in this Section 2.1(1), however, an Active Participant who subsequently terminates employment with an Employer and thereupon loses his seniority under the Collective Bargaining Agreement ... shall thereafter cease to be an Active Participant regardless of whether such Participant is subsequently re-employed by an Employer or a Related Employer.
The Plan provides in 2.3(2) that only Active Participants may
accrue pension credit or benefits under the Plan. In 1987, Branson
22 was an "Active Participant who subsequently terminate[d] employment
with an Employer." Thus, the question for the Trustees became
whether Branson "thereupon los[t] his seniority under the
Collective Bargaining Agreement." The Trustees found that Branson
did lose his seniority under the 1987 CBA and thus "cease[d] to be
an Active Participant" in the Plan, meaning that he could no longer
accrue additional pension credit, regardless of his later
re-employment.
Branson argues that using the 1987 CBA does not comport with
a fair reading of the Plan because the definition of "Collective
Bargaining Agreement" includes not only "[t]he current collective
bargaining agreement between the Company and the Union," but also
any "extensions thereof, or any successor agreements between the
parties." This definition, however, cannot alter the import of the
phrase "thereupon loses his seniority" in section 2.1 (emphasis
added). Black's Law Dictionary defines "thereupon" as: "without
delay or lapse of time." BLACK'S LAW DICTIONARY 1478 (6th ed.1990).
Webster's New Collegiate Dictionary similarly defines "thereupon"
as "immediately after that." WEBSTER'S NEW COLLEGIATE DICTIONARY 1201
(1979). Thus, the Trustees did engage in a fair reading of the
Plan by looking to the collective bargaining agreement in effect
"immediately after" Branson terminated his employment in 1987.
Branson also argues that the Trustees failed to make a fair
reading of the Plan by interpreting the 1987 CBA to impliedly
revoke seniority for employees who voluntarily quit. We disagree.
Branson correctly notes that the 1987 CBA neither explicitly
23 protects nor explicitly revokes the seniority of employees who
voluntarily quit. The 1987 CBA does, however, explicitly retain
seniority for several categories of employees, including:
employees entering the armed forces, employees receiving leaves of
absence for less than 30 days, employees furloughed as part of a
reduction in force (so long as they return to work when it becomes
available), employees in the service of the union, and employees
accepting supervisory positions (so long as they resume a position
within the bargaining unit within 24 months). The Latin maxim
expressio unius est exclusio alterius proves instructive. The
Trustees found that the inclusion of specific circumstances in
which an employee retained seniority meant that an employee did not
retain seniority in other circumstances. Consequently, those
employees who voluntarily quit "lost" their seniority, and the Plan
could not allow any later accumulation of additional seniority.
Branson has failed to show that this is not a fair reading of the
Plan.
Having found that the Trustees' interpretation of the Plan was
legally correct, we need not proceed to the second step of our
analysis. Pickrom v. Belger Cartage Serv., Inc., 57 F.3d 468, 472-
73 (5th Cir.1995). The Trustees did not abuse their discretion in
interpreting the Plan.
IV
In summary, we hold that Branson's breach of contract claim
24 against Greyhound is not preempted by the NLRA or the LMRA.8 We
reverse and remand to the dis-
trict court for proceedings consistent with this opinion.9 We
affirm the district court's judgment in favor of the Plan.
8 We affirm the district court's denial of Branson's motion for summary judgment on his breach of contract claim against Greyhound. The record discloses several genuine issues of material fact, including the type, if any, of seniority credit Greyhound offered Branson, what that seniority credit would have done for Branson, whether or not Greyhound's subsequent behavior contradicted any accepted offer and whether Greyhound has any viable defenses. 9 Branson's only remaining claim is a breach of contract based on state law. In light of this opinion, the district court may revisit its decision to exercise supplemental jurisdiction over Branson's state law claim. See Parker & Parsley Petroleum Co. v. Dresser Indus., 972 F.2d 580, 585 (5th Cir.1992) ("Our general rule is to dismiss state claims when the federal claims to which they are pendent are dismissed.").