Teamsters Local Union No. 89 v. Kroger Co.

617 F.3d 899, 189 L.R.R.M. (BNA) 2001, 2010 U.S. App. LEXIS 17743, 2010 WL 3324435
CourtCourt of Appeals for the Sixth Circuit
DecidedAugust 25, 2010
Docket09-5534
StatusPublished
Cited by18 cases

This text of 617 F.3d 899 (Teamsters Local Union No. 89 v. Kroger Co.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Teamsters Local Union No. 89 v. Kroger Co., 617 F.3d 899, 189 L.R.R.M. (BNA) 2001, 2010 U.S. App. LEXIS 17743, 2010 WL 3324435 (6th Cir. 2010).

Opinion

OPINION

COLE, Circuit Judge.

Plaintiff-Appellee Teamsters Local Union No. 89 (“Local 89” or “the Union”) represents employees in a Kentucky warehouse operated by Defendant-Appellant The Kroger Co. (“Kroger”). The parties negotiated a collective bargaining agreement governing labor relations at that warehouse. Local 89 filed two grievances alleging that Kroger violated this agreement by subcontracting out operations to third parties employing non-Local 89 members. Kroger refused to arbitrate these grievances, and Local 89 filed suit to compel arbitration. The district court granted Local 89 summary judgment on its claim to compel arbitration. Kroger appeals that decision. We AFFIRM the judgment of the district court.

I. BACKGROUND

A. The Parties and the Master Agreement

Local 89 is a local affiliate of the Counterclaim Defendant International Brotherhood of Teamsters (“IBT”) and represents warehouse and transportation employees at Kroger’s warehouse facility in Louisville, Kentucky, known as the Kentucky Distribution Center (“the KDC”). Kroger and the Teamsters Kroger National Negotiating Committee, which represented Lo *901 cal 89 and five other local IBT affiliates, negotiated a collective bargaining agreement governing the industrial relations between the unions and Kroger (“the Master Agreement”), which by its terms is in effect from September 11, 2005, through September 10, 2011. Pursuant to the Master Agreement, Kroger and Local 89 also executed a supplemental agreement to govern specific issues at the KDC (“the Local Supplement”), which runs concurrently with the Master Agreement.

The Master Agreement specifically addresses arbitration, subcontracting, and termination of the contract. Article 8 establishes dispute-resolution procedures, which culminate in binding arbitration. These grievance procedures, including the final step of arbitration, cover “any grievance!,] dispute!]] or complaint over the interpretation or application of the contents of [the Master] Agreement” raised by “any employee.” (District Court Record Entry (“R.E.”) 65-3, at 15.)

Article 25 of the Master Agreement addresses subcontracting. Under Section 25. 1, Kroger has the right to subcontract work assigned to the collective bargaining unit but is prohibited from subcontracting such work “for the purpose of circumventing the terms and provisions” of the Master Agreement to an outside company that does not provide similar wages and conditions of employment. Section 25.3, entitled “Continuity of Employment,” provides that if Kroger decides to contract out its entire KDC warehouse or transportation operations, or both, during the term of the agreement, “then a condition of such subcontract shall be offers of employment to eligible employees (as defined in Appendix I), by the new employer, provided that the new employer requires that number or more to perform such services.” (R.E. 65-4 at 4.) Appendix I, which outlines additional job-security provisions, defines “eligible employees” as “all employees who have continuously been on a regular seniority list for at least three (3) years as of December 12, 2005.” (Id. at 12.) This appendix also requires Kroger to offer comparable employment at the nearest similar facility covered by the Master Agreement to any eligible employee “who is permanently laid-off before September 11, 2011, as a direct result of [Kroger] transferring, subcontracting or closing all or part of any distribution center or manufacturing plant operation covered by a Local Supplement to this Agreement.” (Id.) Appendix I explicitly subjects disputes over its interpretation and application to the arbitration provisions in the Master Agreement.

Finally, Article 36 of the Master Agreement addresses contract termination. Section 36.1, entitled “Effective Dates,” states that the agreement “is effective from September 11, 2005 through September 10, 2011 and year to year thereafter,” unless one of the parties—through its designated negotiating committee—notifies the other party of its desire to terminate or modify the agreement in writing at least 120 days before September 10, 2011. (Id. at 11.) Section 36.2, entitled “Notice to Terminate or Modify,” requires that if either party wishes to terminate or modify the Local Supplement, that party must give the other party notice ninety days prior to September 11, 2011.

B. Kroger Subcontracts to Transervice and Zenith

In October 2006, Kroger announced that it would subcontract out its KDC warehouse and transportation operations. Kroger contracted with Transervice Logistics Inc. (“Transervice”) for transportation operations and with Zenith Logistics Inc. (“Zenith”) for warehouse operations. On February 15, 2007, Kroger transferred the transportation operations to Transervice, *902 and Transervice hired all of Kroger’s KDC transportation employees. On February 22, 2007, Kroger transferred the warehouse operations to Zenith, and Zenith hired all of Kroger’s KDC warehouse employees. Since that date, Kroger has not directly employed any members of Local 89.

Following Kroger’s October 2006 announcement, Local 89 entered into negotiations with Transervice, Zenith, and Kroger, respectively. In April 2007, Local 89’s negotiations regarding new collective bargaining agreements with Transervice and Zenith broke down, and Local 89 struck Transervice and Zenith on April 18 and 19. Subsequently, Local 89 and Kroger entered into an agreement (“the Letter of Understanding”), which was to go into effect only if Local 89 entered into ratified labor agreements with Transervice and Zenith and which, like the Master Agreement, is set to expire on September 10, 2011. Local 89 subsequently entered into separate collective bargaining agreements with Transervice and Zenith.

C. The Letter of Understanding

The Letter of Understanding addresses outstanding grievances under the Master Agreement, the provision of retiree health benefits, and future changes to Kroger’s subcontracting policies at the KDC. In regards to grievances, Local 89 agreed to withdraw several outstanding grievances, including ones it had filed alleging that Kroger’s subcontracting to Transervice and Zenith violated the subcontracting provisions included in Article 25 of the Master Agreement. Also, Kroger agreed to make certain pension contributions and pay settlements based on specified past grievances. Finally, the parties agreed that “Kroger will meet with Teamsters Local 89 and either resolve any outstanding grievances resulting from their employment with Kroger or permit the grievance to proceed through the Kroger Master Grievance Process.” (R.E. 65-12, at 2.) The Letter of Understanding does not address future grievances explicitly.

Regarding retiree health benefits, Kroger agreed to require any successors to Transervice and Zenith to provide retiree health coverage to employees (and their eligible dependants) who retire before September 10, 2011, comparable to the coverage provided under the Master Agreement. Kroger also “agree[d] to continue the current practice of providing retiree health care for already retired former employees from the operations that were transferred.” (Id. at 1.)

Free access — add to your briefcase to read the full text and ask questions with AI

Related

International Union v. Kelsey-Hayes Co.
557 F. App'x 532 (Sixth Circuit, 2014)
Norman VanPamel v. TRW Vehicle Safety Sys., Inc.
723 F.3d 664 (Sixth Circuit, 2013)
Teamsters Local Union No. 89 v. Kroger Co.
921 F. Supp. 2d 733 (W.D. Kentucky, 2013)
United Steelworkers v. Kelsey-Hayes Co.
862 F. Supp. 2d 690 (E.D. Michigan, 2012)
Payne v. Local Lodge 698
856 F. Supp. 2d 915 (E.D. Michigan, 2012)
TL Ventures III Management L.P. v. Fabbio
20 Pa. D. & C.5th 361 (Philadelphia County Court of Common Pleas, 2011)
United States v. Victor GomezCoronado
216 F. App'x 615 (Eighth Circuit, 2007)

Cite This Page — Counsel Stack

Bluebook (online)
617 F.3d 899, 189 L.R.R.M. (BNA) 2001, 2010 U.S. App. LEXIS 17743, 2010 WL 3324435, Counsel Stack Legal Research, https://law.counselstack.com/opinion/teamsters-local-union-no-89-v-kroger-co-ca6-2010.