Citgo Asphalt v. Local 2-991

• Court: Court of Appeals for the Third Circuit
• Decided: October 14, 2004
• Docket: 03-1503
• Status: Published

Opinion

Opinions of the United 2004 Decisions States Court of Appeals for the Third Circuit

10-14-2004

Citgo Asphalt v. Local 2-991 Precedential or Non-Precedential: Precedential

Docket No. 03-1503

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Recommended Citation "Citgo Asphalt v. Local 2-991" (2004). 2004 Decisions. Paper 170. http://digitalcommons.law.villanova.edu/thirdcircuit_2004/170

This decision is brought to you for free and open access by the Opinions of the United States Court of Appeals for the Third Circuit at Villanova University School of Law Digital Repository. It has been accepted for inclusion in 2004 Decisions by an authorized administrator of Villanova University School of Law Digital Repository. For more information, please contact Benjamin.Carlson@law.villanova.edu. PRECEDENTIAL Opinion Filed: October 14, 2004 UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT Ronald H. DeMaria, Esquire (ARGUED) McElroy, Deutsch, Mulvaney, LLP Nos: 03-1503 1300 Mt. Kemble Avenue Morristown, New Jersey 07962

James J. McGovern III, Esq. Genova, Burns & Vernoia CITGO ASPHALT REFINING 354 Eisenhower Parkway COMPANY, Plaza II, Suite 2575 Appellant Livingston, NJ 07039 v. Attorneys for Appellant THE PAPER, ALLIED-INDUSTRIAL, CHEMICAL, AND ENERGY WORKERS Robert F. Henninger, Esquire INTERNATIONAL UNION LOCAL NO. (ARGUED) 2-991 Warren J. Borish Spear, Wilderman, Borish, Endy, Spear and Runckel 36 Tanner Street, 2nd Floor On Appeal from the Order of the United Haddonfield, New Jersey 08033 States District Court for the District of New Jersey Attorneys for Appellee (Civil Action No. 02-CV-00864) District Judge: Hon. Joseph E. Irenas OPINION

McKEE, Circuit Judge. CITGO Asphalt Refining Company Argued December 18, 2003 appeals the district court’s confirmation of a labor arbitrator’s decision that CITGO’s Before: ROTH and M cKee, Circuit zero tolerance drug abuse policy is Judges, unreasonable. For the reasons that follow, and CUDAHY, Senior Circuit Judge * we will reverse.

* The Hon. Richard D. Cudahy, Senior Appeals for the Seventh Circuit, sitting by Circuit Judge of the United States Court of designation. I. FACTS them that they were going to be scheduled for their CITGO Asphalt Refining Company physical and requiring them (“CARCO”) is a New Jersey partnership to respon d to th e involved in the oil refining industry. questionnaires. They were C I T G O Petrole u m C o r p o r a t i o n given one or two days (“CITGO”), is the majority partner of advance notice of the annual CARCO. In December 1998, CITGO physical after they had announced that it was going to implement completed the questionnaire. a new uniform national substance abuse Other than this drug testing policy, which included a zero tolerance as part of the annual policy (the “policy”), at all of its physical, there was not petroleum refining facilities in the nation. random testing. Under the The policy was thereafter implemented at new policy, random testing more than sixty locations. Local 3-0673 is done immediately after of the Paper, Allied-Industrial, Chemical receiving notice. and Energy Workers International Union (“PACE”) challenged the policy after it was implemented at CARCO’s asphalt (2). Under the old policy, plant in Savannah, and the challenge off-duty conduct could not proceeded to arbitration. The arbitrator be a violation, but it is . . . ruled that the policy was proper, valid and under the new policy. reasonable in all respects, and issued an opinion and award denying the Union grievance in its entirety. The policy was (3). [Under the old policy] also challenged at CARCO’s asphalt plant [ C] a use , suspic ion o r in Paulsboro, New Jersey, where the t e c h n ic a l p e r f o rm a n c e hourly workers are represented by PACE problems or occurrence of Local 2-991. There, Local 2-991 argued an accident or incident or that the new zero tolerance policy changed safety violation could the existing policy as follows: trigger a drug test as part of (1). . . .Under the old policy, the annual physical. Under urine tests for drugs were the new policy, drug testing given during the annual can be done without any of physical, with the these prerequisites. individuals to be given their p h y s ic a l e x a m s a n d receiving a w ritten (4). Under the old policy, questionnaire a week or two employees who tested before the physical notifying positive during an annual

2 physical were given an that is totally unreasonable.” opportunity for The grievances proceeded to rehabilitation, i.e., a second arbitration after the parties agreed upon chance. But, under the new the following submission: policy, no employee is given a second-chance opportunity Did CITGO violate Article unless they come forward X X X o f t h e L a b or and admit their drug use Agreement by improperly prior to any positive drug implementing its National test, called “self- Substance Abuse Policy at acknowledgment.” the Paulsboro facility on October 1, 1999. If not, was the policy Local 2-991's Br. at 9-10. unreasonable? Local 2-991 challenged the new policy by filing two grievances. One At the arbitration hearing, the alleged an “Improper implementation of a parties stipulated that the Management ‘new’ drug and alcohol policy.” That Rights Clause (Article III) and the Future grievance claimed that CARCO violated Bargaining Clause (Article XXX) in the the controlling collective bargaining then current CBA were identical to those agreement (“CBA”) by not bargaining contained in every CBA that had been in over the new policy,1 and that the policy effect at Paulsboro since 1977. Article III, violated a provision of the CBA dealing the Management Rights Clause provides, with future bargaining. The other in applicable part, as follows: grievance alleged that the “Company implemented a drug and alcohol policy Except to the extent 1 The collective bargaining relationship expressly abridged by an between the parties began at Paulsboro in express and sp ecific the mid-1970s. The first labor contract at provision of this Paulsboro was negotiated in 1997. Agreement, the Company CITGO bought the facility in 1991 and reserves and retains all of its continued both the bargaining relationship Common Law or other and the CBA. The Paulsboro facility rights to manage the became a refinery in the late 1970s and is business as such rights engaged in the processing of crude oil into existed prior to the asphalt and other products. There were execution of this or any some 56 bargaining unit members when other previous Agreement the grievances were filed. with the Union or any other

3 Union. The rights of amending, modifying, management which are not supplementing or otherwise abridged by this Agreement, altering in any respect shall include, but are not whatsoever this Agreement limited to: . . . make and or any part thereof. enforce rules for the maintenance of discipline and safety, and to suspend, ********** discharge, or otherwise discipline employees for just cause. The listing of 25.4. The Union and the specific rights in this Company both agree that Agreement is not intended the submission to the to be nor shall it be arbitrator shall be based on restrictive of or a waiver of t h e o r i g inal w r i t t e n any of the rights of grievance submitted in the management not listed and grievance procedure. . . . specifically surrendered herein, whether or not such rights have been exercised ********** by the Company in the past.

25.6. The power and authority of the arbitrator Article XXV of the CBA, entitled: shall be strictly limited to “Grievance Procedure and Arbitration,” determining the meaning provides, in relevant part, as follows: and interpretation of the explicit terms of this 25.1. Grievances are Agreement as herein defined as alleged violations expressly set forth. The of express and specific arbitrator shall not have provisions of this authority to add or to Agreement occurring during subtract from or modify any the term of this Agreement of said terms, or to limit or or any renewal or extension impair any Common Law or thereof. . . . Neither the other right of the Company, Union nor an employee or to establish or change any shall use or attempt to use wage or rate of pay. .. . The the grievance procedure as a parties agree that the power m e a n s o f c h a n gi n g , and jurisdiction of any

4 arbitrator chosen hereunder any attachments hereto shall be limited to deciding during the term hereof. whether there has been a violation of a provision of this Agreement. The The parties also stipulated that: a r b i t r a t o r s h a l l n ot (1). The Paulsboro refinery substitute his judgment for is a hazardous work that of the Company in the environment that can absence of a clear abuse of explode and poses a discretion. The arbitrator potential threat to workers, shall not be empowered, the environment, and to the and shall have no public at large. jurisdiction, to base his Award on any alleged practices or oral (2). The bargaining unit understandings which are positions affected by the not incorporated in writing drug testing policy are in this Agreement. . . . safety sensitive (as defined in [Department of Transportation] Article XXX, the Future Bargaining regulations). Clause, provides:

(3). The duties of the The parties acknowledge bargaining unit employees that, during the negotiations are such that their attempts which resulted in this to perform while in a state Agr eement and any of drug impairment may attachments hereto, each pose a threat to co-workers, had the unlimited right and to the workplace, to the opportunity to make environment, and to the demands and proposals with public at large. respect to any subject . . . not removed from the area of collective bargaining . . (4). All employees .and therefore each waives (management and the right to further bargaining unit employees bargaining on any subject alike) at Paulsboro play a not covered or covered critical role in both under this Agreement and

5 preventing accidents and the bargaining unit and only minimizing the effects of two people have ever been accidents. disciplined in two years.

(5). The speed in (2). Motiva never requested responding to a dangerous a zero tolerance program. condition is critical to limiting potential damage and injury. (3). Motiva’s safety record, unlike CITGO’s, is just “industry standard.” In addition, Owen Haynes, a CARCO employee for 30 years and Local 2-991 President for approximately 12 years, (4). Motiva, like CITGO, testified that Paulsboro is a “potentially needed a standardized dangerous work environment,” and Mike policy, company-wide. Drager, the manager of the Paulsboro facility, testified about “toxic and deadly” gases at the refinery. (5). The policy was adopted by “consensus,” not through CITGO contends that the only negotiations. evidence Local 2-991 offered to support its grievance that the Policy was unreasonable was the testimony of Eric (6). Both employees Hamilton, the president of the PACE local disciplined under Motiva’s at a company called “Motiva,” and the p o l i c y w e r e “repeat testimony of Timothy Koladi, the offenders.” Both violated chairman of the union grievance the policy a second time committee at Sun Oil. Both men testified after not being disciplined that the substance abuse policies at their for an initial violation, and respective facilities included random drug both were detected by testing. They also testified that the random testing. Motiva and Sun Oil policies are virtually identical to the CITGO policy except for CITGO’s zero tolerance provision. As to the policy at Sun, Oil, Koladi Hamilton testified as follows testified: regarding the policy at Motiva: (1). There are 384 people in (1). There are 525

6 employees in one During his testimony, DeLeon gave bargaining unit and 550 specific reasons for a zero tolerance employees in the other. provision. He testified that CITGO’s safety record is the best in the industry, a fact not challenged by Local 2-991, and (2). That in the ten years that CITGO wanted to maintain its record. since 1990, only four to six He explained that, in CITGO’s judgment, employees have been offering a second chance “sends a disciplined under the policy message to employees that it’s okay to do and they too were all second drugs until you get caught. . . . [T]hat was offenders, after having been a very strong feeling, . . . .” DeLeon also given a “first chance” explained that the zero tolerance policy without discipline. does not apply if an employee comes forward and identifies him/herself as a person with a substance abuse problem. John DeLeon, CITGO’s Manager He also explained that CITGO’s medical of Human Resources and Labor Relations, director was on the team that designed the testified in defense of CITGO’s Policy and program, and added that the only union in explained the steps CITGO took in the country that had challenged the designing its national substance abuse program was the union at the Savannah, policy. DeLeon testified that CITGO Georgia, asphalt plant. As noted, the reviewed the practices of other companies Savannah arbitration resulted in an award in the industry and patterned much of its which found that the CITGO Policy was policy after the Omnibus Transportation reasonable in all respects. The president Employee Testing Act of 1991, 49 U.S.C. of Local 2-991 testified that the Savannah § 31306 et seq. DeLeon also explained plant is virtually identical to the Paulsboro that, because a uniform policy was needed, facility. all aspects of the program including The arbitrator found “no random testing, zero tolerance, etc. apply contractual breach by [CITGO] with to all employees, from the president of respect to its unilateral adoption and CITGO down. He further explained that implementation of a substance abuse the policy was implemented nationwide, program in 1999.” He also found that the including all facilities where there was mandatory, random testing procedure was union representation, and that he did not both proper and reasonable. However, he know of a major refinery that did not have sustained the local’s challenge to the zero random testing. According to DeLeon, tolerance policy. The arbitrator ruled that Tosco, Marathon and Exxon, three major part of the Policy was unreasonable. He companies in the industry, also had zero explained: tolerance substance abuse polices. DeLeon’s testimony was unrebutted. [T]here can be no serious

7 quarrel with the right of a legitimate objective for any company in this type of company, it has not been industry to make certain that shown to my satisfaction s a f e t y c o n c e r n s a re that permitting an employee paramount and should be to have a “second chance” adequately addressed. . . . would be inconsistent with Indeed, it was recited that that goal. That being so, the CITGO has the best safety Arbitrator agrees with the record in the industry and Union that the Policy, wants to keep it that way. I without giving a second therefore will not seek to chance for rehabilitation, is disturb that record. unreasonable to that extent However, there are specific and to that extent only. This areas of the Policy that are is especially so where the troubling to me. . . . DOT regulations permit second chance or rehabilitation opportunities. While the Union argued that I therefore find that the mandatory random testing Policy should be modified should be declared in that regard. unreasonable, the Arbitrator cannot agree with that position. Having said that, Thus, “[t]he arbitrator . . . sustained [the I do nevertheless understand policy] as written except where it does not and appreciate the Union’s permit a (sic) employee second-chance or argument with respect to rehabilitation opportunities.” App. at 473. employees who test positive The arbitrator held that the policy as the result of random (including CARCO’s right to conduct testing not being given a random drug testing), was reasonable, second chance under the except for the so-called “zero tolerance” Policy. The facts reveal that provision. . . . this is contrary to the II. DISTRICT COURT policies in place at the PROCEEDINGS Motiva refinery in Delaware City, Delaware, and at the CARCO filed a complaint in the Sun refinery in Marcus district court challenging the arbitration Hook. While the Arbitrator fully acknowledges that the best safety record in the industry is obviously a

8 opinion and award.2 CARCO alleged that standard the district court should have the arbitrator: (1) exceeded the power and applied. Exxon Shipping Co. v. Exxon authority given to him by the parties; (2) Seaman’s Union, 73 F.3d 1287, 1291 (3d rendered an award which did not draw its Cir. 1996) (“Exxon III”). essence from the labor agreement; (3) Courts play a very limited role in ignored the plain language imposing reviewing the decision of an arbitrator limitations on his authority; (4) rendered appointed pursuant to a collective an award which was not totally supported bargaining agre em ent. Un ited by the record; and (5) failed to apply the Paperworkers International Union, AFL- standard of review set forth in the CBA. CIO v. Misco, Inc., 484 U.S. 29, 36 Local 2-991 filed an answer and (1987). “When the parties include an counterclaim to enforce the award in its arbitration clause in their [CBA], they entirety. In time, cross-motions for choose to have disputes concerning summary judgment were filed and the constructions of the contract resolved by district court thereafter entered an order an arbitrator.” W.R. Grace and Co. v. granting Local 2-991's motion for Local Union 759, International Union of confirmation of the award in its entirety. the United Rubber, Cork, Linoleum and This appeal followed. The arbitrator’s Plastic Workers of America, 461 U.S. 757, rejection of the zero tolerance provision of 764 (1983). Consequently, we “are not the policy is the only issue on appeal. authorized to reconsider the merits of an III. STANDARD OF REVIEW award even though the parties may allege that the award rests on errors of fact or on We exercise plenary review of the misinterpretation of the contract.” United district court’s confirmation of a labor Paperworkers Union v. Misco, Inc., 484 arbitration award and apply the same U.S. at 36. This follows from the fact that the arbitrator’s judgment was bargained for by the parties. United Steelworkers of 2 The district court had subject matter America v. American Manufacturing Co., jurisdiction pursuant to Section 301(a) of 363 U.S. 564, 568 (1960). “Full-blown the Labor Management Relations Act, 29 judicial review of labor arbitrators’ U.S.C. § 185(a), which provides: “Suits decisions would annul the bargain of the for violation of contracts between an parties for an arbitrator’s construction of employer and a labor organization their [CBA]” and replace it with the representing employees in an industry court’s con struc tion. Stroehmann affecting commerce as defined in this Bakeries, Inc. v. Local 776, International chapter, or between any such labor Brotherhood of Teamsters, 969 F.2d 1436, organizations, may be brought in any 1441 (3d Cir. 1992) (citing United district court of the United States having Steelworkers of America v. Enterprise jurisdiction of the parties, without respect Wheel and Car Corp., 363 U.S. 593, 599 to the amount in controversy . . . .”

9 (1960)). factfinder did not.” Id. Therefore, we do not review an Nevertheless, “[a]n arbitrator has arbitrator’s award for legal error. Exxon the authority to decide only the issues III, 73 F.3d at 1295. “[A]s long as the actually submitted.” Matteson v. Ryder arbitrator’s award draws its essence from System Inc., 99 F.3d 108, 112 (3d Cir. the [CBA] and is not merely [the 1996) (citation omitted). “It is the arbitrator’s] own brand of industrial responsibility of the arbitrator in the first justice, the award is legitimate.” Misco, instance to interpret the scope of the 484 U.S. at 370 (citation and internal parties’ submission, but it is within the quotations omitted). “[O]nly where there courts’ province to review an arbitrator’s is a manifest disregard of the agreement, interpretation.” Id. at 113 (citation totally unsupported by the principles of omitted). Although our review of an contract construction and the law of the arbitration award is “highly deferential[,]” shop, may a reviewing court disturb the id. we do not “simply . . . rubber stamp award.” Exxon III, 73 F.3d at 1295 [arbitrators’] interpretations and decisions (citations and internal quotations omitted). . . . .” Id. (citation and internal quotations Accordingly, the award stands “even if the omitted). court finds the basis for it to be ambiguous IV. DISCUSSION or disagrees with its conclusions under the law.” Stroehman Bakeries, Inc., v. Local As noted above, the only issue 776, 969 F.2d at 1441 (citation omitted). before us is the propriety of the arbitrator’s determination that CITGO’s zero tolerance Therefore, a court can only vacate policy is unreasonable. CITGO makes two an arbitrator’s award “if it is entirely separate, yet closely related, arguments in unsupported by the record or if it reflects a support of its challenge to that portion of manifest disregard of the agreement.” the arbitrator’s determination. First, Exxon III, 73 F.3d at 1291 (citation and CITGO contends that the arbitrator acted internal quotations omitted). “An outside the scope of his authority and arbitrator’s decision need be neither wise rendered an award that did not draw its nor internally consistent.” Id. at 1297. essence from the CBA. Second, it The decision is “subject to a standard of contends that the arbitrator’s determination only minimal rationality.” Id. that the zero tolerance policy is It follows that a reviewing court unreasonable is not supported by the must defer to the arbitrator’s factual record. We will address each contention in findings. Id. “[F]indings of fact and turn. inferences to be drawn therefrom are the A. The arbitrator acted outside the exclusive province of the arbitrator.” Id. scope of his delegated (citing Misco, 484 U.S. at 36). It is not the court’s “role to draw inferences that the authority and rendered an award that

10 did not draw Company in the absence of a clear abuse of discretion.”4 The arbitrator could its essence from the collective therefore only conclude that the zero bargaining agreement. tolerance policy was unreasonable if he found that CITGO clearly abused its discretion in instituting it. However, the The arbitrator made three separate arbitrator found no abuse of discretion, findings. He agreed that there can be no and this record supports none. The “serious quarrel” with CITGO’s right to arbitrator found that the zero tolerance “make certain that safety concerns are policy was unreasonable simply because paramount and . . . adequately addressed.” he did not believe that giving an employee Second, he agreed that CITGO did have a second chance was inconsistent with the best safety record in the industry and CITGO’s goal of having the best safety “wants to keep it that way.”3 Third, he record in the industry. He wrote: “[I]t has agreed that having the best safety record in not been shown to my satisfaction that the industry “is obviously a legitimate permitting an employee to have a ‘second o b j e c t i v e fo r a ny c om pa ny. ” chance’ would be inconsistent with that Notwithstanding this, he stated: “It has not goal.” Thus, rather than concluding that been shown to my satisfaction that CITGO abused its discretion in adopting a permitting an employee to have a ‘second zero tolerance policy, the arbitrator chance’ would be inconsistent with simply substituted his own judgment for [having the best safety record in the CITGO’s, and declared CITGO’s zero industry].” He concluded his analysis tolerance provision unreasonable. with: “[T]hat being so the arbitrator agrees with the Union that the policy, without However, an arbitrator’s opinion giving a second chance for rehabilitation a n d a w a r d b a s e d o n “ g e n er a l is unreasonable.” considerations of fairness and equity” as opposed to the exact terms of the CBA, However, in finding that the fails to derive its essence from the CBA. absence of a second chance was MidMichigan Reg’l Med. Ctr – Clare v. unreasonable, the arbitrator ignored the Professional Employees Div., 183 F.3d parameters of his inquiry as defined in the 497, 502 (6th Cir. 1999). As we explain CBA. As we noted above, Article XXV, more fully below, the award here § 25.6 of the CBA provides, in relevant comported with the arbitrator’s view of part, that “[t]he arbitrator shall not fairness, but did not draw its essence from substitute his judgment for that of the the CBA.

3 4 As noted, the arbitrator added that he According to CITGO, this “is a very would therefore not “seek to disturb that unusual provision to have in a labor record.” agreement.” CITGO’s Br. at 23.

11 Local 2-991 defends the arbitrator’s that go beyond the four corners of a conclusion by arguing that the parties’ collective bargaining agreement.” Id. submission allowed the arbitrator to go (citations omitted) (emphasis added). beyond the § 25.6 “abuse of discretion” As recited earlier, the agreed-upon standard. We agree that, although the submission read: CBA is the “sole source of the arbitrator’s authority[,] . . . [t]he parties may . . . agree Did CITGO violate Article to allow an arbitrator to go beyond the X X X o f t h e L a b or express terms” of the CBA. High Agreement by improperly Concrete Structures, Inc. v. United implementing its National Electrical, Radio and Machine Workers of Substance Abuse Policy at America, Local 166, 879 F.2d 1215, 1218 the Paulsboro facility on (3d Cir. 1989) (citation omitted). “They October 1, 1999. If not, may do so either by providing in the was the policy collective bargaining agreement for unreasonable? interest arbitration as well as rights arbitration,5 or by agreeing, separately, to submit specific issues to arbitration.” Id. As Local 2-991 sees it, even if the (emphasis added). A submission may be language of the CBA prohibited the “express, may incorporate an antecedent arbitrator from substituting his own grievance, or may be based on other judgment for that of CITGO’s absent an relevant submissions or actions.” Id. at abuse of discretion by CITGO, it is the 1219 (citations omitted). “But however language of the parties’ submission that derived, the terms of the submission may controls the extent of the arbitrator’s empower the arbitrator to resolve disputes authority. Therefore, argues Local 2-991, because the submission required that the arbitrator determine, in the event that he 5 In “interest arbitration,” the parties ask found that the policy did not violate the arbitrator to set new terms and Article XXX (the Future Bargaining conditions of employment, while in “rights Clause) of the CBA, whether the policy arbitration,” the arbitrator is asked to was reasonable, the submission freed the r e s o lv e d i s p u t e s i n v o l v i n g t h e arbitrator from the confines of that interpretation or application of terms and portion of the CBA that prohibited the conditions of employment already agreed arbitrator from substituting his own to in the CBA. Local 801, Int’l judgment for CITGO’s absent an abuse of Brotherhood of Boilermakers, Iron discretion by CITGO. More succinctly, Shipbuilders, Blacksmiths, Forgers and Local 2-991 argues that the broad Helpers, ALF-CIO v. Pennsylvania language of the last sentence of the Shipbuilding Co., 835 F.2d 1045, 1046-47 submission trumped the narrower (3d Cir. 1987). language of § 25.6 of the CBA.

12 According to Local 2-991, the arbitrator arbitrator’s conclusion. 6 That failure merely leads to CITGO’s second argument. reviewed the terms of the B. The arbitrator’s decision that the CBA, listened to the zero tolerance policy witn esses’ testi m o n y, is unreasonable is not supported by reviewed the terms of the record. documents submitted, and considered attorney argument. After digesting As recited earlier, “[a]n arbitrator’s all of this evidence, [the award must be enforced so long as it arbitrator] addressed the draws its essence from the collective stipulated issue and found bargaining agreement.” United Industrial that there was no contract Workers v. Government of the Virgin violation. Which brought Islands, 987 F.2d 162, 170 (3d Cir. 1993) the arbitrator to the next (citation and internal quotations omitted). question placed before him “A labor arbitration decision fails to draw by the parties: whether the its essence from the collective bargaining policy was unreasonable. agreement if the arbitrator acted in The arbitrator answered that manifest disregard of the law, or if the question and found the record before the arbitrator reveals no “zero tolerance” portion of support for the arbitrator’ s the policy unreasonable. determination.” Id. (citation omitted) [Thus, according to the (emphasis added). CITGO argues that, union,] [u]nder the circumstances, there can be no doubt that the award is 6 enforceable. Local 2-991's argument seems to establish no standard by which to judge the propriety of the arbitrator’s decision. Local 2-991's Br. at 23. Once the CBA’s “abuse of discretion” standard is jettisoned, the union’s argument would allow the arbitrator to However, assuming arguendo that apply any free-floating standard including the submission trumped the “abuse of his/her own subjective judgment whether discretion” standard in the CBA, it is or not it was supported by the record. nevertheless still apparent that Local 2- This gives the arbitrator almost unfettered 991 has only described what the arbitrator discretion to determine the reasonableness did. The union has not explained either of a challenged policy. The union claims the rationale for, or the basis of, the that the last sentence of the submission did just that.

13 regardless of the scope of the last sentence tolerance policies certainly casts doubt of the submission, the award must still be upon the arbitrator’s focus on Motiva and supported by the record, and this award is Sun Oil, and the arbitrator never explained not. We agree.7 why he elevated the importance of Motiva and Sun Oil refineries over larger ones The arbitrator relied only on two with better safety records. “facts” to support his determination that the zero tolerance policy was The arbitrator also relied upon unreasonable. First, the arbitrator noted provisions of the Omnibus Transportation that neither Motiva nor Sun Oil have zero Employee Testing Act of 1991, 49 U.S.C. tolerance policies at their refineries. § 31306 et seq., and the Department of However, the fact that two companies with Transportation regulations promulgated safety records that are inferior to CITGO’s under it, 49 C.F.R. § 382.101 et seq. That do not have zero tolerance policies does Act and its regulations allow employees a not establish that CITGO acted second chance for rehabilitation. unreasonably in adopting a zero tolerance However, that does not mean that a policy. In fact, considering the stipulated decision to the contrary is unreasonable. catastrophic repercussions of a safety This is especially true when we consider lapse at the Paulsboro plant, and CITGO’s the hazardous nature of CITGO’s superior safety record, one could just as facilities, the need for prompt and readily conclude that it was unreasonable unimpaired action in the event of an for Sun Oil and Motiva not to have a zero emergency, and the exception for tolerance policy. Moreover, the employees who step forward seeking help a r b i t r a tor’s f i n d in g o f th e for a substance abuse problem that CITGO unreasonableness of the zero tolerance has included in its policy.8 Indeed, the policy completely ignores DeLeon’s Supreme Court has noted that the statute unrebutted testimony that the three largest and the regulations at issue leave it to the companies in the industry – Exxon, parties to define appropriate discipline. Marathon and Tosco – have zero The Court explained the backdrop of the tolerance policies exactly like CITGO’s. safety regulations as follows: The undisputed fact that the three largest [W]hen promulgating these companies in the industry have zero

7 8 We do not believe that the arbitrator’s We do not understand how the determination that the zero tolerance arbitrator could conclude on this record policy is unreasonable is supported by the that it is unreasonable for CITGO to adopt record under CITGO’s narrow “abuse of a policy that attempts to pressure impaired discretion” standard” or under Local 2- employees into stepping forward and 991's broader “submission trumps the seeking help before their impairment CBA” standard. results in a catastrophe.

14 regulations, DOT decided employed in safety-sensitive positions not to require employers there, and that impaired employees pose a either to provid e threat to co-workers, the work-place, the rehabilitation or to hold a environment and to the public at large. job open for a driver who Since the Managements Rights has tested positive, on the Clause of the CBA (Article III), expressly basis that such decisions gives CITGO the right “to make and should be left to enforce rules for the maintenance of m anagement/driver discipline and safety” and since CITGO § negotiation. That 25.6 of Article XXV precludes either the determination reflects basic union or CITGO from using the grievance background labor law process to amend the CBA, we are hard- principles, which caution pressed to understand how the arbitrator against interference with could have concluded that the zero labor-management tolerance policy is unreasonable without agreements about substituting his own judgment for appropriate emplo yee CITGO’s and ignoring CITGO’s expressly discipline. reserved right “to make . . . rules for . . . safety.” Eastern Associated Coal Corp. v. United V. CONCLUSION Mine Workers of America, District 17, 531 For the above reasons, we will U.S. 57, 65 (2000) (citations omitted) reverse the district court’s order enforcing (emphasis added). The arbitrator’s award the arbitrator’s decision and award, and here ignores that caution as well as the remand to the district court for an order express reservation of the employer’s vacating the arbitration award. prerogatives as set forth in Article III, the Management Rights Clause. Thus, the fact that Motiva and Sun Oil do not have zero tolerance policies and the fact that a particular federal statute and its implementing regulations allow a second chance, are not sufficient to support a finding that CITGO’s zero tolerance policy is unreasonable. This is especially true given the undisputed evidence that the Paulsboro facility is a hazardous work environment susceptible to explosions, Local 2-991 members are