Opinion
Civil Action No: SA-05-CA-818-XR.
June 28, 2006
ORDER
On this date, the Court considered Defendants' motion for summary judgment (docket no. 36), Defendants' motion to strike (docket no. 47), and Plaintiff's motion for leave to file a sur-reply (docket no. 53).
Facts and Procedural Background
Plaintiff CWA is the bargaining representative for certain SBC employees. CWA and SBC are parties to a collective bargaining agreement. CWA alleges that SBC "unilaterally altered the terms, conditions and application of the [Motor Vehicle Usage Plan] (MVUP)." Plaintiff seeks declaratory relief to "establish the parties' existing rights and obligations concerning the MVUP and the impermissibility of any unilateral changes to said program." It also seeks injunctive relief.
The MVUP is an arrangement wherein SBC assigns a company truck to certain employees to drive from home to their first assignment and then back home from their last assignment. Those employees do not pay for maintenance, gas, or insurance on the company truck. Employees are not required to report to any company facility before reporting to their first assignment. Likewise, they are not required to report to any company facility at the end of their last assignment. Employees save on gasoline expense and wear and tear on their personal vehicles by not having to use their personal vehicles in driving to and from work. The MVUP was first included in the parties' 1983 agreement.
The 2004 collective bargaining agreement addressing the MVUP states:
1. There will be established a Motor Vehicle Usage Program to provide, in those administrative work units where implemented, that employees who participate will be assigned a motor vehicle for use in their work and for traveling between their work locations and places of residence or other designated places for their vehicle storage.
2. The Motor Vehicle Usage Program will be implemented only within administrative work units where some or all of the employees normally use a Company-provided motor vehicle in order to perform their work. The decision to implement and to continue the program within any such administrative work unit will be within Management's discretion.
3. When the Motor Vehicle Usage Program is introduced within an administrative work unit, all employees within that unit who normally use a Company-provided motor vehicle in the performance of their work assignment will be eligible to participate. Participation by any such employees will be on a voluntary basis. . . .
Since 1999, SBC has had a practice of applying higher productivity standards to some MVUP participants. In February 1999, some customer service technicians (CSTs), in certain geographic regions, who participated in the MVUP were expected to be 10% more productive than non-participating CSTs. This was based on the assumption that CSTs traveling from home to work assignments directly did not lose the time associated with picking up their vehicles from the company garage and then driving to their assignment. In the summer of 2005, SBC issued new company-wide productivity objectives. In that communication, SBC advised that all MVUP technicians would be expected to achieve a minimum of 5% productivity over garage-based CSTs. MVUP technicians failing to meet the 5% standard would thereafter be given notice of their deficiency, and if they remain in noncompliance, would be removed from the program.
SBC argues that it is entitled to summary judgment because the collective bargaining agreement provides: (1) management discretion to remove individuals and administrative work units from the MVUP; and (2) a "reserved, inherent right" to implement different productivity standards for MVUP participants and to remove participants who fail to meet those standards.
SBC also argues that it is entitled to summary judgment because: (1) "removing individuals from the MVUP is a past practice and, therefore, an inherent part of the collective bargaining agreement"; (2) the CWA has waived any current challenge because it has failed to challenge the company's previous practice of removing employees from the MVUP; and (3) the CWA's claim is time-barred.
Analysis
1. The MVUP clause is ambiguous
SBC argues that the plain language of the MVUP — "The decision to implement and to continue the program within any such administrative work unit will be within Management's discretion" — allows it discretion to remove individuals assigned to an administrative work unit or the entire administrative work unit from the MVUP.
The CWA argues that the company's discretion is limited. The company can discontinue the program for an entire administrative work unit, but may not discontinue it only for certain employees within the administrative unit.
"Q:. . . . does the Company have the right to remove those five individuals because they didn't meet productivity requirements? Yes or no?
A: The five people, no.
Q: Okay. If the five people aren't meeting productivity requirements, does the Company have a right to remove the vehicles from all ten in the unit? Yes or no?
A: I think they do. If they remove it from all." Deposition of Richard A. Kneupper at p. 113.
SBC argues that the word "within" provides it the discretion to decide which employees within the administrative work unit can remain in the MVUP. The word "within" means "inside of." It further argues that the union's construction attempts to delete the word "within" from the agreement. In further support of their argument that the "plain language" of the collective bargaining agreement provides for management discretion to remove individuals, SBC has submitted evidence that both parties developed "Questions and Answers" during the MVUP implementation that indicate that management had the right to determine the size of administrative work units, which could range from "part of the first-level supervisor's group on up." However, this Court cannot consider evidence of course of dealing or of a party's subjective view about the meaning of a contract unless the contract is ambiguous. See Alexander v. City of Evansville, Ind., 120 F.3d 723, 727 (7th Cir. 1997) (holding that under well-established principles of contract law, as applied to interpretation of collective bargaining agreement, court should not resort to extrinsic evidence to interpret agreement and that court may consult, inter alia, evidence about its formation or the parties' course of dealing if there is some doubt about sense or meaning of contract). If the language of a policy or contract is subject to two or more reasonable interpretations, it is ambiguous. Whether a contract is ambiguous is a question of law for the court to decide by looking at the contract as a whole in light of the circumstances present when the contract was entered. Only where a contract is first determined to be ambiguous may the courts consider the parties' interpretations and admit extraneous evidence to determine the true meaning of the instrument. Dell Computer Corp. v. Rodriguez, 390 F.3d 377, 388 (5th Cir. 2004).
Webster's Ninth New Collegiate Dictionary (1987).
The Union argues that SBC's construction attempts to delete the phrase "administrative work unit" from the MVUP.
The Union presents transcripts from pre-2004 bargaining negotiations indicating that SBC sought broad discretionary language that would have allowed for individuals to be removed from the MVUP. The Union argues that SBC seeks a judicial interpretation of the MVUP that it was not able to procure in the negotiation of the CBA.
Applying these principles to the facts of this case, the Court concludes that the MVUP clause contains a patent ambiguity. It is unclear whether the clause permits SBC to remove individuals (rather than an entire administrative unit) from the MVUP program. It is susceptible of either reading, both of which are reasonable. If any ambiguity exists in a contract, a fact issue remains regarding the parties' intent, thus precluding a grant of summary judgment. East v. Premier, Inc. 98 Fed. Appx. 317, 319 (5th Cir. 2004); Geoscan, Inc. of Tex. v. Geotrace Techs., Inc., 226 F.3d 387, 390 (5th Cir. 2000) ("If a contract is ambiguous, summary judgment is inappropriate because the interpretation of a contract is a question of fact.").
2. SBC's "inherent rights" or "management rights" argument does not automatically supplant the MVUP clause
SBC argues that inasmuch as the collective bargaining agreement is silent as to whether it can impose increased productivity standards, it has the "inherent right" to do so. First, neither party has provided the Court with a complete copy of the CBA. Secondly, the CWA states in an affidavit provided by Andy Milburn that the CBA does not contain any "management rights" clause. The Court can only decide this argument after a side-by-side review of any "management rights" clause against the MVUP clause. SBC further argues that whatever is not specifically addressed by the CBA falls under the "reserved rights doctrine." Under this theory, even despite the absence of a specific "management rights" clause, SBC asserts it is free to implement productivity standards and remove individuals from the MVUP for failure to maintain those standards. Indeed, SBC argues that it can remove individuals from the MVUP for a variety of reasons, including violation of the code of business conduct, safety, etc. However, other provisions of the CBA may allow for discipline to be assessed against individual technicians, without disturbing the MVUP. Inasmuch as fact issues remain on this claim, summary judgment is improper.
3. Has the union waived any objection to SBC's implementation of increased productivity standards for MVUP participants and any removal of individuals for failure to meet such standards?
SBC argues that higher productivity standards and individual removals from the MVUP have been imposed since 1999. SBC presents the affidavit of Anthony Sandidge who testifies that when the company standardized productivity requirements in 2005, he actually had to lower the 10% higher objectives that were in place in the Houston, Texas area. In addition, SBC provides a summary of individuals removed from the MVUP from 2000 through 2005. This summary indicates that 58 individuals were removed from the program (28 of those individuals were removed for productivity issues; the remainder were for disciplinary and safety issues). SBC notes that the union never objected to these removals. SBC specifically highlights that one of the employees removed for non-productivity was a former union local president (James Billedo). In addition, in July of 2000, the company implemented a "Home Dispatch: Technician Course." Those materials indicate that an individual technician must meet minimum performance appraisal standards that include productivity, and that technicians who fall below minimum performance appraisal standards may be suspended from the program. Apparently, the union did not raise any objection to the course materials, performance standards stated therein or removal provisions.
Assuming for summary judgment purposes there was a duty placed upon SBC to bargain with the union over any changes to the MVUP, a party to a collective bargaining agreement waives its right to bargain over an issue only by clearly and unmistakably expressing its intent to do so. Mississippi Power Co. v. N.L.R.B., 284 F.3d 605 (5th Cir. 2002). If a union has actual notice, whether formal or informal, of an employer's planned unilateral amendments to conditions of employment, but does not request bargaining, the union waives any right to bargain. N.L.R.B. v. Pepsi-Cola Bottling Co. of Fayetteville, Inc., 2001 WL 791645 (4th Cir. 2001).
The above notwithstanding, a line of cases outside the Fifth Circuit states that even if a union waived any past infractions, the union's acquiescence in previous unilateral changes in terms and conditions of employment do not operate as a waiver of its right to bargain over such changes for all time. Brewers Maltsters, Local Union No. 6 v. N.L.R.B., 414 F.3d 36 (D.C. Cir. 2005); Nat'l Steel Corp. v. N.L.R.B., 324 F.3d 928 (7th Cir. 2003) (union's knowledge of employer's past use of hidden surveillance cameras and failure to previously request bargaining over cameras was insufficient to show that union expressed its clear intent to forego all future bargaining regarding cameras, such as to amount to waiver); Ciba-Geigy Pharmaceuticals Div. v. N.L.R.B., 722 F.2d 1120 (3d Cir. 1983). This Court has not found any Fifth Circuit case law specifically addressing this issue of waiver "for all time."
In arguing that it has not clearly and unmistakably engaged in a waiver, the union argues that SBC's summary of individuals removed from the MVUP from 2000 through 2005 actually indicates that SBC has not routinely removed unproductive technicians from the MVUP. It argues that the "isolated small number of employees" removed from the MVUP "in relation to the size of the relevant employee universe" failed to place the union on notice of any company practice of removing individual technicians.
With regard to the "Home Dispatch: Technician Course" the Union argues that SBC has an established protocol whereby SBC notifies the union of any proposed changes to working conditions covered by the CBA, and that this protocol was not followed prior to the implementation of the "Home Dispatch: Technician Course." This, of course, is no explanation as to why the Union failed to object to the course (and its references to individual removals) from 2000 to the date suit was filed in this case (August 26, 2005). In addition, the Union offers no coherent explanation as to why no objections or grievances were filed when individual areas such as Houston began to implement higher productivity standards in 1999 to MVUP technicians.
The above notwithstanding when SBC implemented its uniform policy in the summer of 2005, the union responded by filing the present lawsuit just months later. If this Court had clear guidance from the Fifth Circuit on past waivers, it would have little difficulty concluding that the Union's knowledge and acquiescence to the 2000 "Home Dispatch: Technician Course" resulted in a waiver. However, in the absence of Fifth Circuit case law indicating that Brewers and Maltsters, Local Union No. 6, National Steel Corp., and Ciba-Geigy Pharmaceuticals are not controlling, this Court is reluctant to grant summary judgment on the issue of waiver.
4. Limitations
The Court, however, will reserve the option of granting judgment on the basis of waiver after it has fully heard both parties' evidence on this issue.
SBC argues that this suit should be dismissed inasmuch as the claims were brought after the six-month limitations period expired. The Union argues that the limitations period is four years, but even if a six-month limitations period applied, the uniform productivity standards were promulgated in June 2005 and this suit was timely filed in August 2005.
Essentially what SBC argues is that any complaint the Union may have regarding individual removals from the MVUP performed prior to June 2005 are barred by limitations. However, the only complaint the Union lodges in this lawsuit is the implementation of the 2005 policy. Regardless of whether the four-year or six-month limitations period applies, SBC's motion for summary judgment on limitations is denied.
5. Permanent injunctive relief
SBC appears to argue that even if there was a breach of the CBA by unilaterally promulgating its 2005 productivity and removal standards, the Union nevertheless is not entitled to injunctive relief. The Union argues that this Court has the authority to issue injunctive relief as a form of equitable relief should the Court find that a breach of the CBA has occurred. The Court will deny SBC's motion for summary judgment on this issue and revisit the issue of a permanent injunction, if, and when, it has been established that a breach of the CBA has occurred.
Conclusion
The Court concludes that, for the reasons stated above, Defendant's motion for summary judgment (docket no. 36) is DENIED. Defendant's motion to strike the affidavit of Andy Milburn (docket no. 47) is DENIED inasmuch as the only portions of Milburn's affidavit the Court considered were the portions referenced above and those limited passages demonstrate that Milburn has personal knowledge of those facts. Plaintiff's motion for leave to file a sur-reply (docket no. 53) is DENIED.
A bench trial is current set for this case on August 7, 2006. Counsel for SBC has filed an advisory notifying this Court that there may exist a potential conflict with oral arguments set in another matter before the Fifth Circuit. The Court has also developed a conflict for the week of August 7. Accordingly, the August 7 trial setting is vacated. This matter is rescheduled for a bench trial on September 18, 2006 at 9:30 a.m.
The pretrial conference set for July 26, 2006 is rescheduled to September 6, 2006 at 9:00 a.m. The parties shall file their pretrial submissions in the form set out in Rule CV-16(e) to the Local Rules for the Western District not later than September 1, 2006.