BEFORE THE ARBITRATOR
In the Matter of the Arbitration of a Dispute Between
LOCAL 1558, AFSCME, AFL-CIO
AMERICAN RED CROSS
(Grievance of Virgil Miller)
Mr. Laurence S. Rodenstein, Staff Representative, Wisconsin
Council 40, AFSCME, AFL-CIO,
on behalf of Local 1558, AFSCME, AFL-CIO.
Clark Hill P.L.C., by Mr. Fred W. Batten, Attorney at Law, on
behalf of the American Red
On May 20, 1997, Local 1558, AFSCME, AFL-CIO, hereinafter the Union, and
American Red Cross (Badger-Hawkeye Region), hereinafter the Employer, jointly requested
the Wisconsin Employment Relations Commission designate the undersigned staff arbitrator
hear and decide the instant dispute in accordance with the grievance and arbitration
contained in the parties' labor agreement. The undersigned was designated to arbitrate in the
dispute, and a hearing was held before the undersigned on July 29, 1997 in Madison,
There was no transcript made of the hearing and the parties submitted post-hearing briefs by
September 2, 1997 and on September 18, 1997 advised the undersigned that they would not
filing reply briefs.
Based upon the evidence and arguments of the parties, the undersigned makes and
the following Award.
The parties were unable to agree upon a statement of the issues, agreeing that the
undersigned will frame the issues to be decided.
The Union asserts there are two issues in dispute:
(1) Did the Employer violate the Agreement when it refused
to allow the Grievant to
exercise his severance rights? If so, what is the appropriate remedy?
(2) Did the Employer violate the Agreement when it
involuntarily transferred the
Grievant? If so, what is the appropriate remedy?
The Employer states the issue as being:
Has Virgil Miller been "laid off" within the meaning of Article 29
- Severance Pay?
The undersigned concludes that the issues to be decided may be stated as follows:
Did the Employer violate the parties' Agreement when it refused
to permit the Grievant,
Virgil Miller, to take severance pay as an option? If so, what is the appropriate remedy?
The following provisions of the parties' 1994-1997 Agreement have been cited:
ARTICLE 3 - MANAGEMENT
3.0 Except as may be expressly limited by this
Agreement, the Employer has
the sole right to plan, direct and control the working force, to schedule and assign
work to employees, to determine the means, methods and schedules of operation
for the continuance of its operations, to establish reasonable standards, to
determine qualifications, and to maintain the efficiency of its employees. The
Employer also has the sole right to require employees to observe its reasonable
rules and reasonable regulations, to hire, lay off or relieve employees from duties
and to maintain order and to suspend, demote, discipline and discharge employees
for just cause. The Employer has the right to assign
temporarily personnel to any other duties at such times as
natural and man-made disasters
threaten to endanger or actually endanger the public health, safety and welfare or the
continuation beyond the duration of such disasters. The Employer shall determine what
constitutes a natural and man-made disaster as expressed in this Article.
. . .
ARTICLE 6 - DISCRIMINATION
6.0 The Employer and the Union agree that there
shall be no discrimination
against any employee because of age, race, color, handicap, sex, creed, religion,
sexual orientation, ancestry, national origin, Union membership or lack thereof.
. . .
ARTICLE 10 - SENIORITY
10.1 The Employer agrees to recognize the principle of
seniority with due regard
to ability and qualifications in promotions, layoffs and vacation selection, as set
forth in this Agreement.
. . .
10.5 When it becomes necessary to reduce the number
of employees in a
classification, the junior employee(s) will be displaced. Employees affected shall
displace the least senior employee in the same pay classification within their
department, provided they have the ability and qualifications either to perform the
available work immediately or within twenty (20) working days on a satisfactory
basis. Should the affected employee be unable to displace a junior employee in the
same pay classification, he will displace the least senior employee in his
department, provided he has the ability and qualifications either to perform the
available work immediately or within ten (10) working days on a satisfactory basis.
When an employee is reduced from his department, he
shall displace the least
senior employee in the bargaining unit provided he has the ability and qualifications either
to perform the available work immediately or within ten (10) working days on a
Employees who may be affected by a reduction will be
given written notice five
(5) days prior to the date of the reduction. Employees may, during this period, serve
written notice on the Employer of their intent to elect a layoff rather than displace a junior
. . .
ARTICLE 11 - JOB POSTING AND
11.0 Whenever there is a vacancy caused by the
transfer, promotion or
termination of an employee or the creation of a new position, a notice of such
vacancy shall be posted simultaneously in Green Bay and Madison on all bulletin
boards giving all information concerning the position and the requirements of
applicants. Employees who wish to fill such vacancies shall have five (5) working
days in which to make written application to the Employer. All such applicants
will be considered provided that:
(a) the employee is not on probation or in a training period,
(b) the employee has not been promoted within the last four
(4) months, or
(c) the employee has not failed to complete a probationary
period for the same or
similarly classified position within the last four (4) months.
11.1 Employees desiring to apply for a vacancy shall
sign on the posted notice.
The qualified applicant with the most seniority in the department shall be given the
first opportunity at the job. Said employee shall demonstrate the ability and
qualifications to perform the job during a training period and, if said employee is
deemed qualified by the Employer after said training and trial, said employee shall
be assigned to fill the vacancy.
11.2 The Employer may make an immediate temporary
assignment to fill any
vacancy until the vacancy has been filled pursuant to the procedure herein outlined.
. . .
ARTICLE 19 - HOURS OF WORK
19.6 There shall be established schedules for
Bloodmobile runs, Blood return
runs and Hospital Delivery runs. Schedules of work shall be established which
rotate employees with the exception of those employees assigned permanently to
Hospital Delivery runs, through the aforementioned run schedules.
. . .
ARTICLE 29 - SEVERANCE PAY
29.0 An employee who has at least two years of
continuous service with the
Employer and is laid off by the Employer in lieu of retaining any rights under this
Agreement, may elect severance pay in accordance with the following schedule,
provided such election is made in writing within thirty (30) days of the employee's
layoff. An employee who elects severance pay shall lose all rights under this
Agreement and in the event of reemployment shall be treated as a new hire for all
purposes with the Employer.
Two to four years continuous service One week's pay for
each continuous year
Four to eight years continuous service One week's pay for
each six months worked
beyond four such years.
Over eight years continuous service One week's pay for
each four months worked
beyond eight such years.
Severance pay shall be cumulative. For example, an
who has worked seven
continuous years shall be entitled to four weeks' pay for his first four such years and six
weeks' pay for the ensuing three years.
29.1 Severance pay is not available and shall not be
paid to an employee who
resigns, retires, or is terminated for cause.
. . .
The Employer operates facilities in Madison and Green Bay, Wisconsin. The Union
recognized exclusive bargaining representative for all full-time and regular part-time
non-professional employes at those locations. The Grievant, Virgil Miller, has been
employed at the
Employer's Madison, Wisconsin facilities since 1956, the last 15 years as a Product Manager
Courier (PMC). The Grievant is in the C-3 pay classification. Since the Union's organizing
1977, the Grievant had been its President until 1996.
For a number of years the Grievant had been permanently assigned to the
Run", delivering blood to clinics and hospitals along the way, with St. Joseph's Hospital in
Marshfield being the largest customer and the last stop on the run. The Grievant was the
PMC of the four PMC's that was permanently assigned to a run, with the rest rotating
the other runs.
In February or early March of 1997, the Employer was notified it was losing St.
Hospital as a customer. Around that same time, the Employer was attempting to contract
a number of hospitals in the Chicago area to supply them with blood, including Rush
and affiliated hospitals. Due to the loss of St. Joseph's as a customer as of March 31, 1997,
would no longer be a "Marshfield Run" as of that date.
On March 6, 1997, the Employer's Assistant Director of Hospital Services, Mike
Fountain, and Director of Marketing, Tim Ryan, met with the Union's officers to inform
of the loss of the major customer and the possibility of having a "Rush Run" to the Chicago
At that meeting, the Union was told that the Marshfield Run would be eliminated and the
remaining runs would be rearranged somewhat and of the possibility of having a Rush Run.
Union was also told that the Grievant's "position" would be eliminated and that if the Rush
came to be, a new "position" would be created and posted as a C-2 and that the person in the
position would rotate through the runs like the other PMC's. Neither the Grievant nor the
Union's representative, Laurence Rodenstein, were able to attend the March 6th meeting,
however, the Employer taped the meeting and provided the Union with a copy of the tape.
Another meeting was held on March 13, 1997, with John Ridgely, the Employer's
Resources Manager, another manager, the Union's President, Vice-President and Steward,
Grievant (Miller) and Rodenstein present. At that meeting, Ridgely discussed the impact of
loss of the Marshfield Run and what would happen if Rush did or did not sign a contract
Employer. Ridgely indicated in that meeting that Miller would have three options: (1) bump
less senior employe; (2) sign the posting for the Rush Run, if Rush signed; or (3) take
pay. Ridgely and Rodenstein computed how many weeks of pay Miller would have coming
took the severance pay option (109 weeks). It was agreed at the
meeting that Ridgely would obtain retirement information Miller had requested and that
would then have three days from the time he received that information to select one of the
Subsequent to the March 13th meeting, Ridgely had a conversation with the
Administrator, Ralph Roberts, regarding the options he had given Miller. Roberts advised
Ridgely that he would have to discuss the matter with the Employer's Director, Dr. Becker,
he did not think severance pay had been discussed by management as one of the ways to
the loss of the Marshfield Run. Roberts brought the matter to Dr. Becker's attention, who
discussed it with Ridgely. Dr. Becker advised Ridgely that he did not think severance pay
appropriate as the Employer would still need four PMC's if it obtained the contract with
so that there would be no layoff of a PMC in his view.
On March 28, 1997, following his discussions of the situation with Dr. Becker,
called Rodenstein, the Union's President and Miller (who was not home) to advise them that
options given Miller at the March 13th meeting were being revoked. At that time, Ridgely
not provided Miller with any retirement information and Miller had not selected any of the
options. In the interim between the March 13th meeting and March 28th, the "Rush Run"
been posted as a PMC with a C-2 pay classification, rotating run. The posting was signed
another employe, Dennis Lokken. Miller did not sign the posting. On March 31st, a
held at which Ridgely apologized and again advised Miller that severance pay was no longer
option for him. Miller asked Ridgely whether he was supposed to work that day and was
was not. Miller then asked if he would be paid and was told he would not. On April 1,
Miller was called at home and told they had found work for him that day, which work he
performed. On April 2, 1997, Miller was told he had been assigned the Rush Run and
been in that position since that time. Miller remains classified as a PMC and paid as a C-3.
Miller rotates through the runs the same as the other three PMC's.
Ridgely sent Rodenstein the following letter of April 2, 1997, regarding Miller's "Job
Dear Mr. Rodenstein:
We have had several discussions on the subject of Virgil Miller's
employment status, and
there continues to be a great deal of confusion.
With the loss of St. Joseph's Hospital (Marshfield) as a customer,
we discontinued our
delivery to them March 31, 1997, and assigned Virgil Miller to other Product Management
Courier duties. He will retain his C-3 classification but will be scheduled as part of the
courier rotation. In the event
Mr. Miller leaves our employ, the position will be filled (if
necessary) at the C-2 rate.
We also scheduled Virgil to work in the Center April 1, 1997, to
help with general department
maintenance, local deliveries, etc.
John Ridgely /s/
Human Resources Manager
Also on April 2nd, the instant grievance was filed on Miller's behalf alleging that his
had been eliminated and that he was entitled to severance pay under Article 29 of the parties'
Agreement and as was offered as one of his three options at the March 13th meeting. A
was also filed on behalf of Lokken, the employe who had signed the posting for the
Rodenstein sent Ridgely the following letter of April 4, 1997:
Dear Mr. Ridgely:
Pursuant to Article 29, Mr. Virgil Miller is exercising his option
to elect contractual severance
pay. Mr. Miller was notified on March 28, 1997 that his position as Marshfield Driver was
eliminated as a result of business operation changes. Mr. Miller was informed that he could
able to take one of three (3) options:
1) Bump a more junior employee pursuant to Section 10.5;
2) Accept a lesser position working on a rotating shift basis;
3) Exercise his rights to severance under Article 29.
Mr. Miller has been employed continuously with Red Cross since
October 16, 1956, or
approximately 40.5 years. Mr. Miller has earned severance pursuant to the Article 29.0
with approximately 109 weeks of pay.
As you know, Mr. Miller's circumstances parallel Ms. Carol
Rodgers' circumstances when
she received her severance pay. Aside from Mr. Miller's greater length of service with Red
Cross, the only substantive difference between Ms. Rodgers and Mr. Miller is that Mr.
happened to organize this union in 1975 and has been the President of AFSCME Local 1558
Please honor Mr. Miller's request
expeditiously. It would be unfortunate if Red Cross forced
this outstanding long-term employee to have to fight for his benefits.
Very truly yours,
Laurence S. Rodenstein /s/
LAURENCE S. RODENSTEIN
Miller's grievance was processed through the parties' contractual grievance
The parties attempted to resolve their dispute, but were unsuccessful, and proceeded to
the matter before the undersigned.
POSITIONS OF THE PARTIES
The Union first asserts that Miller was laid off on March 31, 1997 when his
Run position was eliminated and that he was subsequently involuntarily transferred to the
Rush Run position. In the past, when a position was eliminated, that employe was offered
option of either bumping a junior employe, taking a layoff, or electing severance pay. That
what happened when Weeth's position was eliminated in LaCrosse and when Rodgers'
was eliminated in Madison. Those instances constitute mutually acknowledged application of
contract under the same circumstances as in this case. Similar to the situation with Weeth,
was invited to post for the Rush Run, but demurred, as was his right. Miller was then
involuntarily transferred to the Rush Run at the direction of the Director. At both the March
and March 13th meetings, the Employer's managers acknowledged that Miller had greater
than being involuntarily reassigned. The Union asserts that the discrepancy between the way
Miller has been treated and the way Weeth and Rodgers were treated is based on Miller's
been the Union's president for its first 19 years. The language of Article 29, Section 29.1 is
and unambiguous that an employe who is laid off may elect severance pay. Miller would
been laid off, but for the involuntary transfer, had he not exercised his bumping rights or his
The Union next asserts that arbitrators have relied upon the doctrine of an "implied
covenant of good faith" as governing an employer's conduct, citing a number of arbitration
as holding that labor agreements contain an implied covenant of good faith and fair dealing
requires that employers not be permitted to exercise their rights in an arbitrary, capricious or
faith manner so as to defeat an employe's rights under another provision of the agreement.
Union posits that in this case management was apparently disturbed by the size of the
severance payout, although it had authorized Rodgers to receive 63 weeks of severance pay
prior year. The Union asserts that the Employer offered no affirmative defense of its
that, by its agent, the Employer and the Union reached a meeting of the minds at the March
1997 meeting and they are bound by that agreement.
The Union also contends that under the principle of "agency", an organization can be
responsible for the acts of its authorized agents even if it has not specifically empowered the
to represent it in the general area within the agent's scope of authority. The Union cites a
of arbitration awards as holding that the principle is so powerful that when an organization's
authorized agent enters into an agreement, even where it is contrary to the clear terms of the
contract or the contract is silent on the point, the agreement entered into is sustained. Other
awards are cited as holding that the agency principle applies as well to grievance settlements.
Even though the question in issue here was settled on March 13, 1997, prior to the filing of
grievance, the critical element of a party's reliance on the other's good faith representations
present. Ridgely's commitment to offer Miller three options, including severance pay,
the Employer the same way as the employers were obligated to comply with grievance
in the arbitration awards cited. Ridgely is the Employer's Human Resources Manager and
represents the Employer in collective bargaining matters and has routinely settled grievances,
well as rejected them. Ridgely is clearly an authorized agent of the Employer and because of
Miller relied on the severance option, and his failure to sign the Rush posting was, in part,
to his reliance on Ridgely's statements at the March 13 meeting. As a result of that reliance,
Miller suffered the loss of one day's pay and was involuntarily transferred. Even if the labor
agreement permitted involuntary transfers, which it does not, the Employer is estopped from
so. Thus, the Employer is bound by Ridgely's actions and even if he was wrong, which he
not, the agency principle holds the Employer accountable.
The Union asserts that there is also a collateral issue in this grievance regarding the
involuntary transfer of Miller to the Rush Run position. Miller was permanently assigned to
Marshfield Run, the only permanently assigned employe, and was not required to rotate runs.
Miller's refusal to sign for the Rush Run when it was posted is consistent with Ridgely's
statements. Article 11 only provides for voluntary transfers and promotions and nothing
an employe, even if his position is to be eliminated, to sign a posting. The forced
ignores Miller's seniority rights. If the Employer's action is sustained, any employe with
length of seniority could be shuffled around and reassigned by whim. While
the Employer has the right under Section 11.2 to make temporary involuntary transfers
to fill a
vacancy until plans to fill it permanently are completed, there is no contractual authority for
permanent involuntary reassignment, citing the maxim, "To express one thing is to exclude
others". The Union concludes that the permanent involuntary transfer of Miller was clearly
impermissible and that the Employer was obligated to post the Rush position and fill it
with Section 11.0 of the Agreement. The Union notes that when Ridgely was questioned as
why he posted the Rush position on cross-examination, he responded that he did not know
The involuntary transfer of Miller not only violated his rights, but also the rights of the
applicant for the Rush Run, Lokken. Thus, in addition to ordering the Employer to pay
severance pay, the Union also requests that the Employer be ordered to place Lokken in
The Employer first asserts that the Union's challenging of Miller's assignment to the
Run as being an improper "transfer" is not before the Arbitrator, as that issue has not been
grieved. Further, the Union confuses the Employer's right to assign work within the
own job classification with assignments to work in a different job classification.
With regard to this grievance, the Employer asserts that it was not required to layoff
Miller. Article 3, Management, provides that the employer "Except as may be expressly
by the Agreement has the "sole right" to plan, direct, schedule and assign work to employes,
It also has the "sole right" to "layoff or relieve employees from duties. . ." There is nothing
the Agreement that "expressly limits" the employer's right to rearrange hospital delivery
delete hospitals from a particular route, or change routes in a manner which would result in a
PMC making a delivery rather than a C-2 PMC, nor is there any provision requiring that the
Employer layoff one or more employes. Nothing in Article 19 - Hours of Work, expressly
the aforementioned management right to assign or change hospital delivery runs. The
of the second sentence of Section 19.6 was contained in the parties' first Agreement, and
that Bloodmobile run assignments will be rotated with Blood Return runs, but that hospital
delivery runs will not be part of that rotation; it does not mean that hospital delivery runs
be rotated among PMC's. It has been the consistent policy of the Employer to so rotate
delivery runs. The exception has been the Marshfield Run because management exercised its
to so assign the work. Section 19.6 was placed in the Agreement in 1977, years before
became a PMC and was not written to protect his claim that his job was the Marshfield Run
only that run and that his job was eliminated with the loss of St. Joseph Hospital as a
Miller's job was to make PMC hospital deliveries. While it so happened that he made
along the same route for a good many years, that does not entitle Miller to severance pay.
Section 10.5 of the Agreement speaks to reductions in force, i.e. "when it becomes
necessary to reduce the number of employees in a classification. . ." The Employer has
specifically determined that it was not necessary to reduce the number of employes in any
classification. While there is arguably an ambiguity in the first paragraph of Section 10.5 as
the meaning of the term "classification", in that PMC is a single job classification, and
in that classification can be paid at a C-2 or C-3 rate and Section 10.5 also references
in the same "pay classification". While using the term "classification" in those different
has a potential to complicate issues, it is not necessary to resolve any such confusion in this
as neither a PMC job classification, nor a C-2 or C-3 "pay classification", was eliminated.
Article 29, Severance Pay, is also irrelevant. That provision states that "if an
laid off", the employe has an option to elect severance pay. The predicate to any employer
obligation under Article 29 is the implementation of the management decision to "reduce the
number of employes in a classification" under Section 10.5, and that did not take place.
Next, the Employer asserts that a discussion with an employe regarding an impending
layoff or eligibility for severance pay does not require that the employe in fact be laid off or
employe receive severance pay. That an Employer intends to layoff an employe or even if
Employer notifies an employe of an impending layoff, is different than actually laying off the
employe. Further, Section 10.5 of the Agreement requires a minimum of five days advance
written notice of reductions in force, and no such notice was given in this case. If an
does not actually suffer the loss of employment or compensation from a layoff, then no
occurred. Citing, In re: Interfaith Medical Center and New York State Federation of
and Dentists, 106 LA 544, (Arbitrator Gregory).
The Employer disputes that Miller was treated differently than other unit members
similarly situated or that he was denied severance pay because of anti-union animus. The
comparison of Miller's circumstances to that of Carol Rodgers, who was laid off in
1996, is misplaced. In Rodgers' case, there was a reorganization resulting in the elimination
accounting functions which were transferred to a different employer. The very type of work
performed by Rodgers was eliminated resulting in a reduction in force, i.e. there was one
accounting position in the unit after the layoff. In Miller's case, there has been no reduction
force within the C-2 or C-3 PMC classification, i.e. there were four PMC's before the loss
Joseph's Hospital, and there still are four PMC's. As to the Union's mention of Robert
there was no testimony offered that would in any way suggest that the severance payments to
Weeth, who was laid off, is inconsistent with how Miller, who was not laid off, had been
Regarding the allegation that Miller was denied severance pay because of anti-union
animus, the Employer asserts it would be fiscally irresponsible to pay out more than $55,000
severance pay to one employe, knowing that it would have to hire another employe to
same work at the same location, and that is what Dr. Becker told the Union when its officers
came to discuss this matter with him after the grievance was filed. There is no
testimony as to
any expression of animus or any evidence of ill motive involved in the Employer's decision.
Illegal motives cannot be attributed to either Becker or Roberts simply because they reviewed
decision of a subordinate which they believed to be in error, as it is part of their
be budget conscious and to manage subordinates. The Employer concludes that the grievance
without merit and asks that it be denied.
One of the prerequisites to being entitled to severance pay under Article 29,
Pay, Section 29.0, is that the employe be "laid off by the Employer. . ." Article 10 -
Section 10.5, the contractual language that applies to layoffs, provides, in relevant part,
it becomes necessary to reduce the number of employees in a classification, the junior
will be displaced." The Grievant's job classification is PMC, and at the time he was, and
the most senior of the four employes in that classification.
The number of employes in the PMC classification was not reduced when the
Run was lost due to the addition of the Rush Run. The Union argues that Miller's "position"
eliminated and a new "position", Rush Run PMC, created, which new position had to be,
was, posted by the Employer pursuant to Article 11 - Job Posting and Transfer. According
Union, since Miller did not sign the posting for that position, he would have been subject to
had the Employer followed the Agreement. That argument, however, ignores the wording in
parties' layoff provision. By its terms, Section 10.5 applies when it is necessary to "reduce
number of employes in a classification". Section 10.5 only applies when a position is
if it results in the reduction in the number of employes in a classification. While the two
go hand-in-hand, that did not occur in this case. That is due at least in part to the
having been an "assignment" rather than a "position". While it is at times difficult to
between an "assignment", especially a permanent assignment, and a position, it is possible
necessary to do so in this case. There is one position description for the PMC classification
it states that the position's "Primary Function" is to transport blood, components, etc. to the
Employer's customers. Under "Major Duties and Responsibilities", it lists "Deliver orders
customers within specified time frame of assigned route." Miller was permanently assigned
Marshfield Run, unlike the three other PMC's who rotated through the other runs, and that is
likely the source of much of the confusion. In this case, however, it was the route that was
eliminated, i.e. the Marshfield Run, and thus Miller's permanent assignment to that route
eliminated with it. Due to the signing of a contract with Rush Memorial Hospital in the
area, a new "route" or "run" was created - the "Rush Run", which was to be rotated like the
runs. There is no longer a permanently assigned run and the four PMC's rotate through the
with Miller now assigned to drive the Rush Run every fourth week. While there was a
impact on Miller as a result of the change in assignments necessitated by the loss of the
Run, his position as a PMC was
not eliminated and there was no reduction in the number of employes in the PMC
The work in the PMC classification was reconfigured due to the changes in customers and
work was assigned to the existing persons in that classification, including Miller. That being
case, there was no layoff situation under Section 10.5. It also follows that there was no
involuntary transfer to another "position"; rather, there was a reassignment of duties within
management's rights under Article 3 necessitated by the change in the Employer's customers.
Further, even if the number of employes in the PMC classification had been reduced, Section
requires that it be the junior employe in the classification that is displaced, and that would
have been Miller. Thus, the event necessary to trigger the right to severance pay under
29, i.e. layoff, did not occur with regard to Miller.
In addition to the finding that Miller's "position" was not eliminated, the fact that the
number of employes in the PMC classification was not reduced also distinguishes this case
the circumstances present in the cases involving Carol Rodgers and Robert Weeth. It
from the evidence that Rodgers' position was eliminated, as the work she had been
was being transferred out of the bargaining unit, resulting in there being no work for her to
perform and one less employe in her job classification. With regard to a prior situation
Weeth, it again appears that there was one less Lab Aide position and one less employe when
was said and done. Given that both the Rodgers and Weeth situations apparently resulted in
reduction in the number of employes in their respective classifications, they do not establish
practice that the elimination of a "position" (without a concomitant reduction of the number
employes in a classification) triggers the layoff provisions of Section 10.5, and thus, the right
severance pay under Section 29.0.
The Union has asserted that, the parties' Agreement aside, the Employer is bound by
Ridgely's offer of the three options he gave Miller at the March 13th meeting, one of those
options being to take the severance pay. In that regard, the Union has asserted the principles
good faith and fair dealing in a party's exercise of its rights under a labor agreement, the
of "agency" and the doctrine of promissory estoppel. There are a number of problems with
Union's arguments. First, for there to be a binding agreement reached, there must have been
offer and an acceptance. While Ridgely's representations to Miller at the March 13th
could be said to constitute an "offer", there was no "acceptance" of that offer before it was
revoked by Ridgely on March 28th. Formal acceptance of the offer was not communicated
Employer until Rodenstein's letter of April 4th. The lack of acceptance of the offer made by
Ridgely before it was rescinded, distinguishes this case from the situations in the awards
the Union with regard to the binding effect of entering into a grievance settlement.
The principle that all labor agreements contain an implied covenant of good faith and
dealing such that a party may not exercise its contractual rights in an arbitrary, capricious or
discriminatory manner is well-accepted. The Union infers in this regard that the Employer
in this case to deprive Miller of his contractual right to severance pay because of the
management bore towards him as the long-time president of the Union. There simply is no
evidence of such animus. While the Employer's managers acknowledged that Miller had
very active in representing the Union's members, there is nothing to indicate that was the
of Becker's or Robert's concerns with the options Ridgely had offered Miller. Becker
testified that he questioned Ridgely's interpretation of how the parties' labor agreement
to the facts, in that he did not consider there to be a layoff situation giving rise to a right to
severance pay, since there would be no reduction in the number of PMC's. Becker conceded
while he did not recall telling the Union's officers that he did not want to pay Miller two
pay to play golf, he might have said it. Even if Becker made that statement, it is not
to demonstrate animus or bad faith on his part. Most employers would reasonably balk at
an employe a large sum of money when it is not necessary and would avoid doing so if it
required. Having concluded that the situation did not require a layoff, it was not an act of
faith on Becker's part to direct Ridgely to rescind the options he had offered Miller at the
The Union also asserts that the Employer should be estopped from rescinding its
March 13th offer to Miller because of his having relied on that offer to his detriment.
principle of promissory estoppel, if Miller had in fact relied on that offer to his detriment,
Union would be correct. The detrimental reliance cited by the Union in this regard is
failure to sign the posting for the Rush Run. Failure to sign for a posting would normally
in the loss of the opportunity to obtain the position posted and would constitute detrimental
reliance. The issue of whether there was a "position" to be posted aside, Miller was instead
assigned to the Rush Run, an action which the Union also challenges as unauthorized under
labor agreement as an "involuntary transfer". That question has been addressed previously in
determining whether the Employer was required to instead lay Miller off, at least to the
the Employer's action was found to constitute an assignment of work within its contractual
management rights and not the elimination of Miller's position. The point, however, is that
promissory estoppel is after all an equitable doctrine, and alleging that the detrimental
the loss of the opportunity to obtain something the party in fact received, but does not in
want, does not comport with that doctrine.
The Grievant's disappointment and dissatisfaction with what has occurred is certainly
understandable. What appears to have occurred, however, was an honest mistake on
part, some confusion on everyone's part as to what constitutes a "position", and
subsequent realization of its error. Other than the loss of a day's pay (March 31st), which
management acknowledged was due to its mistake (and therefore ought to rectify), Miller has
treated in accord with the terms of the parties' labor agreement. It is concluded that the facts
this situation did not establish a layoff situation with regard to the Grievant, and that,
the Employer did not violate the parties' Agreement when it denied the Grievant, Virgil
Based upon the foregoing, the evidence and the arguments of the parties, the
makes and issues the following
The grievance is denied.
Dated at Madison, Wisconsin this 29th day of January, 1998.
David E. Shaw /s/
David E. Shaw, Arbitrator