Teamsters Local 391 v. Ball Corp.

355 F. Supp. 2d 803, 176 L.R.R.M. (BNA) 2595, 2005 U.S. Dist. LEXIS 969, 2005 WL 147457
CourtDistrict Court, M.D. North Carolina
DecidedJanuary 14, 2005
Docket1:01CV0404
StatusPublished
Cited by3 cases

This text of 355 F. Supp. 2d 803 (Teamsters Local 391 v. Ball Corp.) is published on Counsel Stack Legal Research, covering District Court, M.D. North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Teamsters Local 391 v. Ball Corp., 355 F. Supp. 2d 803, 176 L.R.R.M. (BNA) 2595, 2005 U.S. Dist. LEXIS 969, 2005 WL 147457 (M.D.N.C. 2005).

Opinion

MEMORANDUM OPINION

TILLEY, Chief Judge.

This suit arises from a dispute between Plaintiff Teamsters Local 391 (“Local 391”) and Defendant Ball Corporation (“Ball”) regarding payments due from a gainsharing agreement at Ball’s Reidsville, North Carolina, manufacturing plant. The case is currently before the Court on Ball’s Motion for Summary Judgment [Doc. # 18]. For the reasons set forth below, the Defendant’s Motion will be GRANTED.

I.

The facts in the light most favorable to the Plaintiff are as follows.

A.

Local 391 has represented the production and maintenance employees at Ball’s Reidsville plant since 1979. The Reidsville plant at issue in this case manufactures aluminum cans for Miller Brewing Company and other beverage companies. The Reidsville plant was initially owned and operated by the Miller Brewing Company and thereafter by the Reynolds Metals Company (“Reynolds”) until it was acquired by Ball on August 10,1998.

When Ball acquired the plant, it became the successor to an existing collective bargaining agreement between Reynolds and Local 391 that was effective from October 6, 1997, with an expiration date of October 5, 2000. Ball and Local 391 later negotiated a similar collective bargaining agreement that became effective October 6, 2000, with an expiration date of October 5, 2003.

In 1993, Reynolds owned more than thirty manufacturing facilities throughout the United States when it negotiated the collective bargaining agreement with its Reidsville plant that has formed the nucleus of all subsequent labor agreements at the plant. Although the Reidsville plant was the only facility whose employees were represented by Teamsters, the collective bargaining agreement at each facility contained identical provisions for the operation of a gainsharing plan. The agreements provided that:

a. The maximum payout under the gainsharing plan at each plant would be five percent (5%) of the qualified earnings; and
b. The gainsharing plan would be self-funded, based on the gains realized at *805 each plant from process improvements, increased productivity and customer satisfaction, improved quality and safety, and lower operating costs.

(Joint Aff. ¶ 12.) The agreements further provided that at each plant a committee consisting of an equal number of representatives from the union and management were responsible for developing a gains-haring plan that would operate for that specific facility. The gainsharing plan developed by the committee was required to comply with the terms of the collective bargaining agreement and the guidelines issued by the Gainsharing Corporate Steering Committee contained in the Gainsharing Design Book. Finally, the gainsharing plan had to be approved by the Gainsharing Corporate Steering Committee before becoming effective.

In addition, the collective bargaining agreement between Reidsville and Local 391 provided that the plan must be consistent with the provisions of an attached “Memorandum of Understanding.” (Compl. ¶7; Answer ¶ 7.) This memorandum stated at the outset that “[a] Plant Gainsharing Plan will be designed to provide gainsharing payments of up to 5% of qualified earnings.” (Id.) The memorandum then proceeded to list six requirements of the gainsharing plan including that it must be self-funded paying up to one dollar for every two dollars of gain; that the plant gainsharing team must review the plan annually to ensure consistency; and that it must comply with the overtime provisions of the Fair Labor Standards Act. The final item states that the plan is “required to set aside a reserve of 25% of gains, which will be paid at the end of the year after accounting for any quarterly deficits.” 1 (Id.)

In accord with the collective bargaining agreement, the gainsharing plan for the Reidsville plant was designed by a committee, the Gainsharing Design Team, consisting of five union and five management representatives, who met on twelve occasions. The Gainsharing Design Team was provided with a set of guidelines, the Gainsharing Design Book, which was created by the Gainsharing Corporate Steering Committee so that each of Reynolds’ plants would have guidelines for the design and implementation of each plant’s gains-haring plan. By the time the Reidsville Design Team was formed, thirty-four of Reynolds’ other plants had designed and implemented gainsharing plans in accordance with the guidelines contained in the Gainsharing Design Book.

A section of the Design Book provides explicit instructions to the Design Teams regarding plan requirements and design. Gainsharing plans are required to be self-funded, which is defined to mean that all gains paid to plant employees are “generated from actual monetary savings realized on employee influenced manufacturing costs items at individual locations .... Gains are realized when the actual performance level is better than the baseline established in the approved local gainshar-ing plan.” (Joint Aff. ¶ 21.) The employees’ gainsharing pool is funded by up to fifty percent of the gains realized, and the other fifty percent will go directly to the company. (Id.) The employees receive fifty percent of their gains so long as that figure does not exceed the cap of 5% of qualified earnings. If fifty percent of their gain does exceed 5% of qualified earnings, the employees would only receive an amount equal to 5% of qualified earnings.

*806 The Design Book provides that each plant has the option of making gainsharing payments annually, semi-annually, or quarterly. If the plant chooses to make payments semi-annually or quarterly, it becomes necessary to establish a reserve in order to help protect the company against paying out too much gains when there are losses in later periods. The Gainsharing Design Book clarifies that gains or losses are measured against the whole plan year even when payments are made semi-annually or quarterly, and the reserve is necessary to meet the self-funding requirement. The Gainsharing Design Book sets forth the following rules for calculating the amount of the reserves and the disposition of the reserves, if any, at the end of the plan year:

Plan participants’ share of losses go to the reserve.
25% of the plan participants’ share of gains to go the reserve unless that leaves the reserve in a negative position. In such cases, additional plan participants’ gains will go to the reserve until the reserve is brought back to zero before any gains are shared.
The sum of the gainsharing payments for each gainsharing period cannot exceed 5% of the total qualified earnings for a location’s plan. All gains in excess of the 5% of qualified earnings go to the reserve.
Any deficit in the reserve at year end is absorbed by the company.
Any positive reserve balance remaining at year end is shared, up to 5% of qualified earnings.
At year end, any amounts in the reserve in excess of 5% of qualified earnings remain with the company.

(Joint Aff.

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355 F. Supp. 2d 803, 176 L.R.R.M. (BNA) 2595, 2005 U.S. Dist. LEXIS 969, 2005 WL 147457, Counsel Stack Legal Research, https://law.counselstack.com/opinion/teamsters-local-391-v-ball-corp-ncmd-2005.