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LOCAL 300, NATL. POSTAL MAIL HANDLERS UNION v. NAT

June 3, 1991

LOCAL 300, NATIONAL POSTAL MAIL HANDLERS UNION, et al., Plaintiffs,
v.
NATIONAL POSTAL MAIL HANDLERS UNION, A DIVISION OF THE LABORERS' INTERNATIONAL UNION OF NORTH AMERICA, AFL-CIO; and UNITED STATES POSTAL SERVICE, Defendants


Louis F. Oberdorfer, United States District Judge.


The opinion of the court was delivered by: OBERDORFER

LOUIS F. OBERDORFER, UNITED STATES DISTRICT JUDGE

 Plaintiffs are several local unions of the National Postal Mail Handlers Union and several officers from one of those locals ("Locals"). They seek to restrain the implementation of a contract governing the relationship between the United States Postal Service (the "Service") and employees represented by the National Postal Mail Handlers Union ("National") for the period commencing November 20, 1990, as well as the National membership's pending ratification vote on that contract.

 A hearing on plaintiffs' application for a temporary restraining order was held on March 14, 1991. Based upon the submissions of the parties and the argument at that hearing, the application was treated as one for a preliminary injunction and a further hearing was scheduled for a week later. In the interim, the defendants filed motions to dismiss or for summary judgment. After a hearing on March 21, 1991, an order of the same day denied the National's application for a preliminary injunction "for reasons stated from the bench and to be more fully stated in ruling on the pending dispositive motions." This memorandum discusses those dispositive motions. For the reasons stated below, an accompanying order will grant defendants' motions and dismiss the complaint.

 I.

 The contract between the Service and the National was negotiated pursuant to the Postal Reorganization Act of 1970. See 39 U.S.C. §§ 101 - 5605 (1988) [hereinafter, the "Act"]. The Act "provided for the first time that postal labor relations were to be similar to those in the private sector and were, to the extent consistent with the [Act], to be subject to the requirements of the National Labor Relations Act." American Postal Workers Union, Local 6885 v. American Postal Workers Union, 214 U.S. App. D.C. 278, 665 F.2d 1096, 1098 (D.C. Cir. 1981) (citations omitted). For the most part, the Act leaves the procedures for resolving labor disputes to the parties: "The Postal Service and bargaining representatives recognized under section 1203 may by mutual agreement adopt procedures for the resolution of disputes or impasses arising in the negotiation of a collective-bargaining agreement." 39 U.S.C. § 1206(c). The Act, however, prohibits strikes by postal employees. See 39 U.S.C. § 410(b)(1) (incorporating 5 U.S.C. § 7311(3)). Furthermore, cognizant of the effect of this prohibition on the bargaining position of the employees and also mindful of the overriding public interest in uninterrupted postal service, the Act mandates quick resolution of bargaining impasses through compulsory and binding interest arbitration. See 39 U.S.C. §§ 1207(c) & (d); see also H.R. Rep. No. 91-1104, 91st Cong., 2d Sess. 10 (1970) ("The existing ban on strikes by Federal employees is carried forward, and consequently, binding arbitration is provided for in the event of a bargaining impasse between the parties."); accord S. Rep. No. 91-912, 91st Cong., 2d Sess. 7 - 8 (1970).

 Specifically, the Act provides that labor agreements may only be terminated or modified upon 90 days written notice and that the Federal Mediation and Conciliation Service must be notified "of the existence of a dispute within 45 days of such notice, if no agreement has been reached by that time." Id. § 1207(a). If the parties fail to reach a new agreement by the time that the existing agreement expires, the head of the FMCS must then appoint a factfinding panel. See id. § 1207(b). If after another ninety days no agreement is reached "or if the parties decide upon arbitration but do not agree upon the procedures therefor, an arbitration board shall be established . . . ." Id. § 1207(c)(1). Finally, the Act provides that "if the parties do not agree on the framing of the issues to be submitted, the factfinding panel shall frame the issues and submit them to the arbitration board." Id.

 II.

 Negotiations between the National and the Service began in August 1990 in contemplation of the expiration of the three-year contract into which the parties had entered on November 20, 1987. *fn1" These contract renewal negotiations between the Service and the National were the eighth since the postal reorganization in 1970. *fn2" Like all the ones preceding them, these negotiations were conducted pursuant to a protocol providing that

 
any tentative agreement reached on a particular item was subject to a complete agreement on the terms of a new contract. Simply stated, we agreed that there was "no deal until there was a whole deal." *fn3"

 Moreover, when this protocol was adopted, the parties understood that under the Act, if an entire agreement were not reached, their dispute would be subject to binding interest arbitration. *fn4"

 On November 20, 1990, when the existing contract expired, the parties had failed to reach agreement on any item. Accordingly, the Service announced that it would proceed to interest arbitration. *fn5" However, pending initiation of that process the National and the Service agreed to renew informal negotiations with a view to reaching what agreement they could. *fn6" This phase of the negotiation continued from December 1990 until early February 1991. *fn7" In the process, the National succeeded in reaching tentative agreements that the Service would abandon "give backs" that it had sought, maintain cost-of-living allowances ("COLAs") for existing employees, and adopt an advantageous mechanism for calculating employee insurance premiums. *fn8" The National also persuaded the Service to continue a "no-lay-off" clause in the expiring contract which the Service had sought to eliminate. *fn9" In addition to withdrawing these "give-back" proposals, the Service agreed to substantial annual bonuses for employees plus an incentive payment. *fn10" The parties remained in impasse, however, with respect to COLAs for new employees: While the National demanded that COLAs commence on the first day of each new employee's service, the Service would only offer to commence COLAs for new hires after three years of employment. *fn11"

 At this point, the National leadership was faced with a dilemma. On the one hand, it wanted to protect what it considered to be significant victories in the tentative agreement. On the other hand, it wanted to honor Article V, Section 9 of its Constitution which provides that its members:

 
shall be entitled to ratify by majority vote national contracts in accordance with procedures published by the National Executive Board in a timely fashion prior to ratification. Members shall be entitled to be furnished with the text of any proposed changes and deletions together with their ballots.

 National and Local Constitutions of the National Postal Mail Handlers Union As Amended by the National Convention November 7 - 10, 1988 and Judicially Approved, Art. V, § 9 (Affidavit of Laurence Q. Adams, Exhibit 1). Accordingly, when the Service suggested submitting not only the COLA issue but also the tentative agreement to the arbitration panel with the understanding that the tentative agreement would be incorporated into the panel's award, the National's negotiators hesitated. *fn12" The Service, however, made it abundantly clear that, consistent with the practice and understanding that there would be "no deal until there was a whole deal" it would not agree to submit only the COLA issue to the arbitration panel. *fn13" To resolve this impasse, the National proposed that after the arbitration was complete it would submit the entire agreement including the arbitration decision on the COLA issue to the membership for ratification. *fn14" The Service rejected this proposal taking the position that if both the tentative agreement and the disputed COLA issue were submitted to the arbitrators, the arbitration award would be final and binding and the ratification superfluous. *fn15" The National, while persisting in its stated intention to submit the entire package for ratification at the conclusion of the arbitration, nevertheless agreed to submit the tentative agreement for incorporation into the arbitrator's award in order to protect the gains that it had made in the tentative agreement. *fn16" This understanding was memorialized in a letter from the Service informing the Federal Mediation and Conciliation Service that the parties were proceeding

 
with the understanding recently provided to the Postal Service by Union representatives that the interest arbitration award, which will be comprised of all the terms of our tentative agreements, as well as the sole issue which is to be decided ...

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