Justia Arbitration & Mediation Opinion SummariesArticles Posted in US Court of Appeals for the Sixth Circuit
Bakery, Confectionery, Tobacco Workers and Grain Millers International Union AFL-CIO v. Kellogg Co.
Local Union 3-G represents employees at Kellogg’s Battle Creek plant and is affiliated with the International Union, which represents employees at additional Kellogg’s plants. “Regular” employees and “non-regular” employees, including casual employees, make up the 3-G bargaining unit. There is a Master Agreement between Kellogg, the International Union, and local unions at four plants, which have Supplemental Agreements. A Memorandum of Agreement, appended to the Battle Creek Supplemental Agreement, states that the Supplemental and Master Agreements will not apply to casual employees and the Company may terminate casual employees without being subject to the grievance procedure. A 2015 Master Agreement “established wage rates, a signing ratification bonus for all employees, the establishment of a transitional employee classification to replace casual employees, and other changes" for all Battle Creek bargaining unit employees. After the ratification vote, Kellogg refused to pay a ratification bonus to casual employees, seasonal employees, and some regular employees. The parties went through the grievance procedure, but Kellogg refused to arbitrate, arguing that the arbitration provisions do not apply to casual employees. The Sixth Circuit previously held that arbitration provisions in the “Memphis Supplemental Agreement” did not cover casual employees. The district court determined that judicial estoppel did not apply to the Battle Creek action and granted the motion to compel arbitration. The Sixth Circuit affirmed, The Agreement has a broad arbitration clause, so the presumption of arbitrability is particularly applicable. View "Bakery, Confectionery, Tobacco Workers and Grain Millers International Union AFL-CIO v. Kellogg Co." on Justia Law
Gaffers v. Kelly Services, Inc.
Gaffers is a former employee of Kelly, which provides outsourcing and consulting services to firms around the world, including “virtual” call center support, where employees like Gaffers work from home. Gaffers alleged that Kelly underpaid virtual employees, based on time spent logging in to Kelly’s network, logging out, and fixing technical problems. Gaffers sued on behalf of himself and his co-workers (over 1,600 have joined) seeking back pay and liquidated damages under the Fair Labor Standards Act (FLSA), 29 U.S.C. 216(b). About half of the employees that Gaffers sought to represent signed an arbitration agreement with Kelly (Gaffers did not sign one) stating that individual arbitration is the “only forum” for employment claims, including unpaid-wage claims. Kelly moved to compel individual arbitration under the Federal Arbitration Act, 9 U.S.C. 4. Gaffers contended that the National Labor Relations Act and the Fair Labor Standards Act rendered the arbitration agreements unenforceable. The district court agreed with Gaffers. The Sixth Circuit reversed. In 2018, the Supreme Court held, in Epic Systems, that the National Labor Relations Act does not invalidate individual arbitration agreements. The court rejected arguments that FLSA displaced the Arbitration Act by providing a right to “concerted activities” or “collective action” or rendered the employees’ arbitration agreements illegal and unenforceable. View "Gaffers v. Kelly Services, Inc." on Justia Law
Nestlé Waters North America. Inc. v. Mountain Glacier LLC
The Sixth Circuit affirmed the decision of the district court affirming the bankruptcy court concluding that Mountain Glacier properly reserved its arbitration claim in its dispute with Nestle Waters after Mountain Glacier filed for Chapter 11 bankruptcy. The bankruptcy automatically stayed the companies’ arbitration. After the bankruptcy proceedings ended, Mountain Glacier attempted to resume arbitration, but Nestle Waters objected, arguing that Mountain Glacier failed properly to reserve the arbitration in its reorganization plan. The lower courts disagreed, as did the Sixth Circuit, holding (1) Mountain Glacier’s reservation enabled creditors to identify its claim and evaluate whether additional assets might be available for distribution; and (2) neither Browning v. Levy, 283 F.3d 761, 772 (6th Cir. 2002) nor 11 U.S.C. 1123(b)(3) required Mountain Glacier to provide more information than it did. View "Nestlé Waters North America. Inc. v. Mountain Glacier LLC" on Justia Law
Flight Options v. International Brotherhood of Teamsters
The Unions represents the pilots of merged airlines Flight Options and Flexjet. Flight Options and its pilots have had a collective bargaining agreement since 2010, while Flexjet’s pilots are newly unionized and are not yet party to a CBA. The parties dispute whether the integration of the pilot groups’ seniority lists (ISL) is solely a Union matter, so that the airlines must accept the Union's list or whether the airlines should have been allowed to participate in negotiating the list. The 2010 CBA governs the creation of the ISL when Flight Options acquires another carrier. The district court, acting under the Railway Labor Act (RLA), 45 U.S.C. 152, entered a preliminary injunction ordering the airlines to accept the Union’s ISL. On appeal, the airlines argued that the dispute was “minor” and subject to exclusive arbitral jurisdiction. The Sixth Circuit affirmed in part. The 2010 CBA does not arguably justify the airlines' assertion that they have a right to participate in the ISL process; the dispute is major. The district court properly enjoined the airlines to honor the express terms of the CBA, but those terms provide that if the airlines refuse to accept the Union’s proffered ISL, the Union may invoke an expedited grievance-arbitration process, which uniquely applies to such disputes. The court ordered modification of the injunction accordingly. View "Flight Options v. International Brotherhood of Teamsters" on Justia Law