Wackenhut Services, Inc. v. United Government Security Officers of America, Local 44

• Court: District Court, District of Columbia
• Decided: September 30, 2010
• Docket: Civil Action No. 2009-1433
• Status: Published

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

) ) WACKENHUT SERVICES, INC., ) ) Plaintiff, ) ) Civil Case No. 09-1433 (RJL) v. ) UNITED GOVERNMENT SECURITY ) OFFICERS OF AMERICA, LOCAL 44, ) ) ) Defendants. ) ) ~ MEMORANDUM OPINION (Septembe~, 2010) [#11 and #13]

PlaintiffWackenhut Services, Inc. ("plaintiff' or "WSI") brings this action

against United Government Security Officers of America, Local 44 ("defendant"

or "Local 44") to vacate, or modify, an arbitration award issued under the

Collective Bargaining Agreement between WSI and Local 44, effective October 1,

2007 to September 30, 2010 ("CBA"). WSI claims, in essence, that the

underlying grievance was not arbitrable and that, even if it were, the award

exceeded the arbitrator's authority under the CBA. Before this Court is WSl's

Motion for Summary Judgment and Local 44's Cross-Motion for Summary

Judgment. After due consideration of the parties' pleadings, the relevant law, and

the entire record herein, WSI's motion is DENIED and Local 44's motion is

GRANTED. BACKGROUND

WSI is a Florida corporation that provides security services to U.S.

Government agencies and private companies, including the Department of Justice

("DO]"). Compl. ~ 4. Prior to May 2008, under WSI's contract with DOJ, all

security officers deployed at DOJ sites were required to be armed Justice

Protective Security Officers ("JPSOs"). Id. ~~ 9-10. In August 2007, due to

difficulties in hiring and retaining JPSOs in the Washington, DC area, together

with the increasing demand for more security guards at a new DOJ site, WSI

proposed to DOJ a two-tiered staffing arrangement that would include both armed

JPSOs and unarmed Special Service Officers ("SSOs"). PI.'s Stmt. of Facts ("PI.

Stmt.") ~~ 11-19. Six months later, in February 2008, DOJ approached WSI and

asked if it remained willing to explore a two-tiered arrangement. Id. at 26-28.

Subsequently, DOJ and WSI explored a staffing arrangement to supplement

JPSOs that incorporated armed Special Police Officers ("SPas"). See PI. 's Mot.

Mem. at 6; Def.'s Mot. Mem. at 5. SPOs, who had less credentials than JPSOs,

would be paid a competitive salary, but one less than the current ]PSO salary. See

PI.'s Mot. Mem. at 9; Def.'s Mot. Mem. at 7. After reaching agreements on all

outstanding issues, WSI and DO] entered into a formal bilateral contract

modification ("Mod 41") on May 22, 2008. Compi. ~ 9.

Local 44 is a union representing security officers employed by WSI and

working at DOl Id. ~ 5. On May 28, 2008, WSI informed Local 44 of Mod 41

and provided the union with a copy of the modification. Id. ~ 11. Local 44

2 immediately objected to this contract modification. Pl.'s Mot. Mem. at 10.

Notwithstanding their objection, WSI began hiring SPOs to staff the security

positions in mid-August 2008. See Compl. ~ 12. On September 2,2008, Local 44

filed a grievance claiming that WSI had violated various terms of the CBA by

hiring SPOs to perform work otherwise performed by JPSOs. Id. ~ 13. Pursuant

to the procedures outlined in the CBA, WSI and Local 44 disputed this grievance

through various intermediate steps before proceeding to arbitration. Id. ~ 14. WSI

consistently maintained that Local 44's grievance was not arbitrable under the

CBA. See id. ~ 15.

On June 16, 2009, however, Arbitrator Andrew M. Strongin ("Strongin")

found that Local 44's grievance was arbitrable because it involved neither an

interpretation ofWSI's contract with the government, nor the "adherence to a

request" from the government. Conry Decl. Ex. 15, at 7-9. As such, Strongin

concluded that WSI had violated the terms of the CBA by staffing positions

identified in Mod 41 with SPOs. Id. at 9-15. Central to Strongin's holding was

the admission made by WSI representative Kevin Conry, "that nothing in Mod 41

precludes WSI from continuing to staff all posts with JPSOs, albeit at the new

SPO rate." Id. at 14. Thus, Strongin determined that WSI should pay those SPOs

already hired the negotiated wage under the CBA, both retrospectively and

prospectively. Id. at 16. Strongin further determined that WSI should cease hiring

any additional SPOs. Id.

On July 31, 2009 WSI brought this action challenging Strongin's decision,

3 claiming that defendant's grievance was not arbitrable and that, even if it were, the

award issued by Strongin exceeded his authority under the CBA. Compl." 18-

26. WSI, in essence, wants this Court to vacate Strongin's decision or, at a

minimum, modify it to be consistent with the CBA. Id. ,,25-26. For the

following reasons, I cannot do either.

ANALYSIS

Both plaintiff and defendant have moved for summary judgment pursuant

to Fed. R. Civ. P. 56. Summary judgment shall be granted in favor of a particular

movant if the record demonstrates "that there is no genuine issue as to any

material fact and that the movant is entitled to judgment as a matter of law." Fed.

R. Civ. P. 56(c); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)

(citing same). In deciding whether there is a disputed issue of material fact, the

Court must draw all justifiable inferences in favor of the non-moving party. See

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986).

I. Defendant's Grievance Was Arbitrable Under the CBA

In deciding whether a labor dispute is subject to arbitration under a

collective-bargaining agreement, this Court is guided by the four principles set

forth by the Supreme Court in AT & T Tech., Inc. v. Commc 'ns Workers ofAm.,

475 U.S. 643, 648-50 (1986). The first principle recognizes that arbitration is the

product of contractual obligations and, therefore, "arbitrators derive their authority

to resolve disputes only because the parties have agreed in advance to submit such

grievances to arbitration." Id. at 648-49. As such, the second principle recognizes

4 that unless the parties have agreed otherwise, it is for the courts, not the arbitrator,

to decide whether arbitration is required under the agreement. Id. at 649. Third,

in deciding whether a grievance is arbitrable, courts should not "rule on the

potential merits of the underlying claims." Id. And under the fourth principle, the

courts recognize a presumption ofarbitrability. Id. at 650. Specifically, this

principle requires that arbitration be upheld "unless it may be said with positive

assurance that the arbitration clause is not susceptible of an interpretation that

covers the asserted dispute." Id. (emphasis added).

Here, Article 7 of the CBA sets forth the grievance procedures binding on

WSI and Local 44. Conry Decl. Ex. 2 ("CBA"), at 5-8. With respect to

arbitration, Section 3(d) of the agreement states, "[e]xcept as limited below, any

grievance arising during the term of this Agreement not resolved [through prior

grievance procedures] may be submitted to arbitration by [Local 44] ..." Id. at 6.

As an initial matter, Section 3(d)(i) makes clear that only Local 44 can initiate an

arbitration proceeding. Id. Section 3(d)(ii) then states, in relevant part, that "[n]o

grievance regarding a dispute as to ... the Employer's adherence to a request of

the Government shall be processed to [arbitration] since those matters are not

arbitrable ... " Id. Sections 3(d)(iii)-(vii) proceed to set out the procedures and

permissible scope for the arbitration. In that regard, Section 3( d)(vii) states that

the "arbitrator shall have no to power to ... consider any matter or substitute

his/her judgment for that of the Government's regarding a determination or

request of the Department of Justice ... " Id. WSI argues, however, that the effect

5 of this section of the agreement actually precludes arbitration here because

Strongin made reference in his decision to DOJ's requests and inquiries leading up

to the adoption of Mod 41. See Pl.'s Mot. Mem. at 14-15. I disagree.

Article 7, Section 3(d), in its entirety, clearly indicates that it is Section

3( d)(ii) that sets the limits on what types of grievances may be arbitrated. In other

words, Section 3(d)(ii) establishes the limits on the arbitrator's jurisdiction. l

Indeed, the text of Section 3( d)(ii) specifically enumerates the "grievance [s]" that

"are not arbitrable" under the agreement. CBA at 6. Thus, Strongin would have

no jurisdiction over a "dispute as to ... the Employer's adherence to a request of

the Government" Id. (emphasis added). Section 3(d)(vii), by comparison, merely

establishes limits on the scope of the arbitrator's authority in addressing and

remedying a grievance that has been properly put before him or her. This

limitation is evident from the Section, itself, which provides that the arbitrator may

not look beyond or modify the CBA, apply law, establish or modify any wage

rates, limit WSI's discretion "except only as that discretion may be specifically

limited by the express terms of [the CBA]," or, indeed, consider matters regarding

requests from DOJ. Id. at 7. It is also, of course, consistent with the well-

established cannon of construction that prefers an interpretation of a contract

"which gives a reasonable, lawful, and effective meaning to all the terms ... to an

interpretation which leaves a part [of the contract] unreasonable, unlawful, or of

1Indeed, the structure of Section 3 sets forth the grievance procedure in chronological order. Plaintiff's reading of Section 3(b)(vii) is simply inconsistent with the structure of the section. 6 no effect." Restatement (Second) of Contracts § 203(a) (1981). If this Court were

to adopt WSI's reading of Section 3(d)(vii), as a supplement to those limitations

set forth in Section 3(d)(ii), I would effectively be rewriting the CBA to include a

more restrictive scope of arbitrability than that set forth in Section 3(d)(ii). See id.

§ 203 cmt. b. 2 Instead, applying Article 7, Section 3(d)(ii) to the question of

arbitrability, I easily conclude that defendant's grievance was indeed arbitrable.

How so?

Defendant's grievance states the following:

On or about August 18, 2008, the Employer began employing employees with the classification Special Police Officer (SPO) to perform work otherwise performed by bargaining unit JPSOs. The SPOs do not receive the same wages andlor benefits as bargaining unit JPSOs. The Employer unilaterally made the decision to hire such SPOs, and unilaterally set their terms and conditions of employment.

Conry Dec!. Ex. 11. The record unambiguously illustrates that WSI's actions, as

2 In any event, Strongin did not "consider" any matter regarding DOJ's request, in violation of Section 3(d)(vii), when he made his determination. Conry Decl. Ex. 14 at 11-19. Unlike the question of arbitrability, which is a matter for the courts, "the scope of the arbitrator's authority is itself a question of contract interpretation that the parties have delegated to the arbitrator." W.R. Grace & Co. v. Local Union 759, Int'/ Union a/United Rubber, 461 U.S. 757, 765 (1983). Thus, this Court's review of plaintiff's claims under Section 3(d)(vii) is very limited. See United Paperworkers Int'l Union v. Misco, Inc., 484 U.S. 29, 36 (1987). Strong in determined that, notwithstanding any requests by DOJ, plaintiff had violated the terms of the CBA by hiring SPOs to perform JPSO functions. Conry Decl. Ex. 14 at 14-18. Further, Strongin's resolution did not require consideration of the DOJ's requests or of Mod 41. Id. at 18. Indeed, Strongin determined that because "nothing in Mod 41 precludes WSI from continuing to staff all posts with JPSOs, albeit at the new SPO rate," his resolution did not "interfere in any way with DOJ's ability to enjoy the fruits of Mod 41." Id. Strongin correctly used his ability to determine the scope of his authority under the CBA. In so doing, Strongin, far from considering "any matter ... regarding a ... request of the [DOJ]," determined that no consideration of a request was necessary. 7 specified in the grievance, were not in adherence to a request of the Government

as prohibited in Section 3(d)(ii). First, it is clear that it was WSI who initiated the

dialog with DOJ regarding a two-tiered hiring structure, a fact wholly inconsistent

with a finding that plaintiff "adhered" to a request. 3 See Wackenhut Services Inc.

v. UGSOA, Local 44, No. 05-805, 2006 u.S. District LEXIS 19414, at *6-7

(D.D.C. Mar. 30, 2006). Second, WSI was never bound by any of the DOl's

requests. To the contrary, when DOJ approached WSI in February 2008, DOJ

asked ijWSI was still interested in pursuing the two-tiered structure it had

proposed in August 2007, and DOJ was thereafter guided by WSI' s proposals on

how the two-tiered structure would operate. See Conry Decl. ~~ 9-12. Thus,

WSI's ultimate decision to violate the terms of the CBA was its own and not

attributable to its "adherence" to a DOJ request. For these reasons, plaintiff has

failed to overcome the presumption of arbitrability embodied in Section 3(d). 4

II. Arbitrator Strongin's Award Must Be Confirmed

Finally, WSI claims that Strongin's award here must be either vacated or

modified because Strongin inappropriately "establish[ed] ... [a] wage rate," in

3 Plaintiffs argument that the August 2007 proposal of a two-tiered structure had no causal effect on the DOl's February 2008 request is to no avail. See Pl.'s Opp'n at 4-5. Whether the second-tier officer was armed or unarmed is not dispositive of the issue. Mr. Conry's own explanation of the DOJ's inquiry into whether plaintiff "remained willing to explore such an arrangement" indicates that it was a merely follow-up to the August 2007 discussion. Conry Decl. ~ 8. 4 Defendant also argues that WSI's argument requires the Court to look beyond the scope of the grievance and that WSI's interpretation of the CBA would lead to absurd results. Def.'s Mot. Mem. at 18-20. This Court, however, need not reach these questions. For the reasons stated above, this Court finds that defendant's Motion for Summary Judgment must be granted. 8 violation ofCBA, Article 7, Section 3(d)(vii), by requiring plaintiff to pay SPOs

the JPSO wage. Pl.'s Mot. Mem. at 23. I disagree.

The standard of review for arbitration awards is extremely narrow. United

Paperworkers Int'l Union v. Misco, Inc., 484 U.S. 29, 36 (1987). Indeed, "[t]he

refusal of courts to review the merits of an arbitration award is the proper

approach to arbitration under collective bargaining agreements," because it is

consistent with the "federal policy of settling labor disputes by arbitration" and

recognizes the parties' consensual agreement encompassed in the arbitration

clause. United Steelworkers ofAm. v. Enterprise Wheel & Car Corp. ("Enterprise

Whee!"), 363 U.S. 593, 596 (1960). Notwithstanding that practice, however, this

Court recognizes that "an arbitrator is confined to interpretation and application of

the collective bargaining agreement." Id. at 597. Therefore, "[an arbitrator's]

award is legitimate so long as it draws its essence from the [agreement]." Id.

Here, plaintiff, in essence, mischaracterizes Strongin's award. Far from

establishing a wage rate, Strongin merely recognized that under the CBA, plaintiff

was required to pay the JPSO rate. See Conry Decl. Ex. 14, at 18. Because the

award not only draws its essence from the CBA, but is an entirely reasonable

interpretation of the terms of the CBA, this Court must, and will, uphold his

judgment. See Enterprise Wheel, 363 U.S. 597-98.

9 CONCLUSION

For all of the foregoing reasons, the Court DENIES WSI's Motion for

Summary Judgment [#11] and GRANTS Local 44's Cross-Motion for Summary

Judgment [#13]. An Order consistent with this decision accompanies this

Memorandum Opinion. \

ru~ United States District Judge