Livingston v. Nestle-LeMur Co.

607 F. Supp. 1337
CourtDistrict Court, S.D. New York
DecidedMay 1, 1985
DocketNo. 84 Civ. 8233 (RWS)
StatusPublished
Cited by2 cases

This text of 607 F. Supp. 1337 (Livingston v. Nestle-LeMur Co.) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Livingston v. Nestle-LeMur Co., 607 F. Supp. 1337 (S.D.N.Y. 1985).

Opinion

OPINION

SWEET, District Judge.

Plaintiff David Livingston, as president of District 65, United Automobile, Aerospace and Agricultural Implement Workers, AFL-CIO, (“District 65”) has moved for summary judgment seeking enforcement of the arbitrator’s award in District 65’s dispute with the Nestle-LeMur Company (“LeMur”). The motion for summary judgment is granted.

Facts

District 65 and LeMur are parties to a collective bargaining agreement which controlled working conditions at LeMur’s manufacturing plant in the Bronx. The terms of this agreement, which runs from June, 1982 until May 31, 1985, are not in dispute and include not only the terms of the June 1982 agreement but also various of the terms of collective bargaining agreements signed in 1971, 1974, 1976, 1978, and 1979 which were incorporated in the 1982 extension. Various of these provisions read as follows:

SUB-CONTRACTING
The Employer may continue its present practice of subcontracting work. The Employer may sub-contract other work if it does not cause a layoff of employees for lack of work.
NO MOVING
The Employer agrees that he shall not move any of its operations from its present location to any place beyond fifty miles from the present location or thirty-five miles from Columbus Circle whichever is greater.
In the event the Employer moves to a new location requiring extra travel time, severance pay for those employees who do not choose to transfer to the new location shall be paid in accordance with the severance pay formula provided for in individual supplements to this agreement.
The Employer shall reimburse employees who elect to go to the new location for the additional carfare required to travel to and from the new location. For those employees who had no carfare expense, the Employer shall pay only for carfare in excess of the New York City subway fare (round trip).
SEVERANCE PAY
5A. In the event the Employer liquidates or discontinues the present opera[1339]*1339tions, in whole or in part which would result in permanent layoff, for any reason whatsoever, he agrees that severance pay shall be paid to the employees in the following manner:
Employees employed 1 to 4 years 1 week
" " 4 to 7 years 2 weeks
“ « 7 to 10 years 3 weeks
• " 10 to 15 years 4 weeks
" " 15 to 20 years 5 weeks
" " 20 to 21 years 6 weeks
" " 21 to 24 years 7 weeks
" " more than 24 years 8 weeks
SHUTDOWN
6. In the event of a shutdown, the Union will get sixty days notice to negotiate severance pay improvement.
ADJUSTMENT OF DISPUTES
B. The Arbitrator, as hereinabove mentioned, shall be selected by both sides by mutual agreement. In the event both sides fail to mutually agree on an Arbitrator, within twenty-four (24) hours, either party may ask the American Arbitration Association to appoint an Arbitrator and such appointee shall be the Arbitrator in the matter involved. The decision of the Arbitrator shall be final and binding upon both parties and shall be fully enforceable. It is understood that the Arbitrator shall not have the power to amend, modify, alter or subtract from this agreement or any provision thereof. ..

The Current Dispute

In October, 1983 LeMur decided to terminate production at the Bronx facility and “to contract out work that the bargaining unit employees had performed in the Bronx facility.” (Def’s Memo of Law at 4). In November, 1983 LeMur, allegedly pursuant to its obligation to give sixty days notice to the Union in the event of a shutdown, invited the Union to negotiate improvements in severance pay. District 65 claimed that LeMur’s plans violated the “sub-contracting” and “No Moving” clauses of the contract, and, consequently, no agreement between LeMur and District 65 with respect to LeMur's severance pay obligations to the employees was reached. LeMur proceeded with its plans to have other companies produce the products which had been manufactured at the Bronx facility, and all employees at the Bronx plant were laid off between March and May 1984.

Pursuant to the arbitration clause of the contract, the parties submitted the following stipulated issue to Arbitrator Bertram Kupsinel:

Did the Company violate the collective bargaining agreement by shutting down its plant and thereupon using contractors to produce and/or process products formerly manufactured by said plant? If so, what shall be the remedy?

The Arbitrator’s essential holding was as follows:

First of all, in deciding the issue presented, I conclude that the No Moving clause is immaterial. I conclude that this clause is operative only when this Company or an alter ego of this Company moves from the Bronx facility to a new location. There is no evidence that the Company moved to a new location and the evidence is clear that the firms which are now performing work which had been performed at the Company’s Bronx plant are not alter egos or affiliates of this Company.
The real issue in this case depends on the construction of two provisions in the collective bargaining agreement which appear to be conflicting. If there were no reference to subcontracting in the agreement, there would be no dispute. The Company did shut down operations at the Bronx, in that it was more economical to have other firms do the work. The Company argues that it subcontracted before when the production of aerosol products became illegal and the Union did not grieve this subcontracting which resulted in layoffs. The Company concedes that the Parties recognized that the layoff was a result of legislation beyond the ambit of the collective bargaining process. The example of a fire [1340]*1340burning down the plant, in my view, is a different situation because the instant situation was instigated by the Company, whereas a fire (barring arson) is caused by a force beyond the Company’s control.
The Company’s argument is that “shutdown” in the severance pay clause means for any reason, including economic motivation. Once there is a shutdown, the severance pay clause comes into play and the subcontracting provision is meaningless. This argument would make sense to me — only if there were no subcontracting provision in the agreement. The subcontracting provision, however, has been in a series of agreements for many years and I take it to mean what it says. The word “shutdown” does not mean that the Company can achieve the shutdown by contracting out the work. The fact that “liquidation” and “shutdown” are used in the disjunctive does not mean that the. shutdown may be achieved by subcontracting out the work. To my mind, “liquidation” is the sale of assets and “shutdown” is a cessation of operations. Neither term, however, in my view, renders void the subcontracting provision of this agreement.

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Cite This Page — Counsel Stack

Bluebook (online)
607 F. Supp. 1337, Counsel Stack Legal Research, https://law.counselstack.com/opinion/livingston-v-nestle-lemur-co-nysd-1985.