Respondent employer's collective bargaining agreement with
petitioner union authorizes the submission to binding arbitration
of any grievance that arises from the interpretation or application
of the agreement's terms, and reserves to management the right to
establish, amend, and enforce rules regulating employee discharge
and discipline and setting forth disciplinary procedures. One of
respondent's rules listed as causes for discharge the possession or
use of controlled substances on company property. Isiah Cooper, an
employee covered by the agreement who operated a hazardous machine,
was apprehended by police in the backseat of someone else's car in
respondent's parking lot with marijuana smoke in the air and a
lighted marijuana cigarette in the frontseat ashtray. A police
search of Cooper's own car on the lot revealed marijuana gleanings.
Upon learning of the cigarette incident, respondent discharged
Cooper for violation of the disciplinary rule. Cooper then filed a
grievance which proceeded to arbitration on the stipulated issue
whether respondent had just cause for the discharge under the rule
and, if not, the appropriate remedy. The arbitrator upheld the
grievance and ordered Cooper's reinstatement, finding that the
cigarette incident was insufficient proof that Cooper was using or
possessed marijuana on company property. Because, at the time of
the discharge, respondent was not aware of, and thus did not rely
upon, the fact that marijuana had been found in Cooper's own car,
the arbitrator refused to accept this fact into evidence. However,
the District Court vacated the arbitration award and the Court of
Appeals affirmed, ruling that reinstatement would violate the
public policy "against the operation of dangerous machinery by
persons under the influence of drugs." The court held that the
cigarette incident and the finding of marijuana in Cooper's car
established a violation of the disciplinary rule that gave
respondent just cause for discharge.
Held:
1. The Court of Appeals exceeded the limited authority possessed
by a court reviewing an arbitrator's award entered pursuant to a
collective bargaining agreement. Pp.
484 U. S.
36-42.
Page 484 U. S. 30
(a) Absent fraud by the parties or the arbitrator's dishonesty,
reviewing courts in such cases are not authorized to reconsider the
merits of the award, since this would undermine the federal policy
of privately settling labor disputes by arbitration without
governmental intervention. The parties having agreed to submit all
questions of contract interpretation to the arbitrator, the
reviewing court is confined to ascertaining whether the award draws
its essence from the contract and does not simply reflect the
arbitrator's own notions of industrial justice. As long as the
arbitrator is even arguably construing or applying the contract and
acting within the scope of his authority, the court cannot overturn
his decision simply because it disagrees with his factual findings,
contract interpretations, or choice of remedies. Pp.
484 U. S.
36-38.
(b) The Court of Appeals was not free to refuse enforcement of
the award simply because it considered the cigarette incident ample
proof that the disciplinary rule had been violated, since no
dishonesty is alleged here, and since improvident factfinding is
hardly a sufficient basis for disregarding what the arbitrator
appointed by the parties determined to be the historical facts. Nor
is the arbitrator's refusal to consider the evidence of marijuana
in Cooper's car a sufficient basis for nonenforcement, since the
collective bargaining agreement largely left evidentiary matters to
the arbitrator, whose decision on this point was consistent with
the practice followed by other arbitrators of refusing to admit
evidence which a discharging party did not rely upon. Assuming that
the arbitrator did err on this point, his error was not in bad
faith or so gross as to amount to affirmative misconduct. Moreover,
his decision not to consider the disputed evidence did not forever
foreclose respondent's use of that evidence as a basis for
discharge. Even if it were open to the court to find a disciplinary
rule violation on the basis of that evidence, the court could not
properly set aside the award because, in its view, discharge was
the correct remedy, since arbitrators normally have wide discretion
in formulating remedies. Although the agreement here may have
limited the arbitrator's remedial discretion by giving respondent
the unreviewable right to discharge violators of the disciplinary
rule, the proper course would have been remand to the arbitrator
for a definitive construction of the contract in this respect. Pp.
484 U. S.
39-42.
2. The Court of Appeals erred in setting aside the arbitral
award on public policy grounds. A court's refusal to enforce an
arbitrator's interpretation of a collective bargaining agreement is
limited to situations where the contract, as interpreted, would
violate "some explicit public policy" that is
"well defined and dominant, and is to be ascertained by
reference to the laws and legal precedents, and not from general
considerations of supposed public interests."
W. R. Grace & Co. v. Rubber Workers, 461 U.
S. 757,
461 U. S. 766.
An alleged public policy must be properly
Page 484 U. S. 31
framed under the approach set out in
W. R. Grace, and
the violation of such policy must be clearly shown. Here, the court
made no attempt to review existing laws and legal precedents, but
simply formulated a policy against the operation of dangerous
machinery under the influence of drugs based on "general
considerations of supposed public interests." Even if that
formulation could be accepted, no violation of the policy was
clearly shown, since the assumed connection between the marijuana
gleanings in Cooper's car and his actual use of drugs in the
workplace is tenuous, at best. It was inappropriate for the court
itself to draw that inference, since such factfinding is the task
of the arbitrator chosen by the parties, not the reviewing court.
Furthermore, the award ordered Cooper's reinstatement in his old
job or an equivalent one for which he was qualified, and it is not
clear that he would pose a threat to the asserted public policy in
every such alternative job. Pp.
484 U. S.
42-45.
768 F.2d 739, reversed.
WHITE, J., delivered the opinion for a unanimous Court.
BLACKMUN, J., filed a concurring opinion, in which BRENNAN, J.,
joined,
post, p.
484 U. S.
46.
JUSTICE WHITE delivered the opinion of the Court.
The issue for decision involves several aspects of when a
federal court may refuse to enforce an arbitration award rendered
under a collective bargaining agreement.
II
Misco, Inc. (Misco, or the Company), operates a paper converting
plant in Monroe, Louisiana. The Company is a party to a collective
bargaining agreement with the United Paperworkers International
Union, AFL-CIO, and its union local (the Union); the agreement
covers the production and maintenance
Page 484 U. S. 32
employees at the plant. Under the agreement, the Company or the
Union may submit to arbitration any grievance that arises from the
interpretation or application of its terms, and the arbitrator's
decision is final and binding upon the parties. The arbitrator's
authority is limited to interpretation and application of the terms
contained in the agreement itself. The agreement reserves to
management the right to establish, amend, and enforce "rules and
regulations regulating the discipline or discharge of employees"
and the procedures for imposing discipline. Such rules were to be
posted, and were to be in effect "until ruled on by grievance and
arbitration procedures as to fairness and necessity." [
Footnote 1] For about a decade, the
Company's rules had listed as causes for discharge the bringing of
intoxicants, narcotics, or controlled substances on to plant
property or consuming any of them there, as well as reporting for
work under the influence of such substances. [
Footnote 2] At the time of the events involved in
this case, the Company was very concerned about the use of drugs at
the plant, especially among employees on the night shift.
Isiah Cooper, who worked on the night shift for Misco, was one
of the employees covered by the collective bargaining agreement. He
operated a slitter-rewinder machine, which uses sharp blades to cut
rolling coils of paper. The arbitrator found that this machine is
hazardous, and had caused numerous injuries in recent years. Cooper
had been reprimanded twice in a few months for deficient
performance.
Page 484 U. S. 33
On January 21, 1983, one day after the second reprimand, the
police searched Cooper's house pursuant to a warrant, and a
substantial amount of marijuana was found. Contemporaneously, a
police officer was detailed to keep Cooper's car under observation
at the Company's parking lot. At about 6:30 p.m., Cooper was seen
walking in the parking lot during work hours with two other men.
The three men entered Cooper's car momentarily, then walked to
another car, a white Cutlass, and entered it. After the other two
men later returned to the plant, Cooper was apprehended by police
in the backseat of this car with marijuana smoke in the air and a
lighted marijuana cigarette in the frontseat ashtray. The police
also searched Cooper's car and found a plastic scales case and
marijuana gleanings. Cooper was arrested and charged with marijuana
possession. [
Footnote 3]
On January 24, Cooper told the Company that he had been arrested
for possession of marijuana at his home; the Company did not learn
of the marijuana cigarette in the white Cutlass until January 27.
It then investigated, and, on February 7, discharged Cooper,
asserting that, in the circumstances, his presence in the Cutlass
violated the rule against having drugs on the plant premises.
[
Footnote 4] Cooper filed a
grievance protesting his discharge the same day, and the matter
proceeded to arbitration. The Company was not aware until September
21, five days before the arbitration hearing was scheduled, that
marijuana had been found in Cooper's car. That fact did not become
known to the Union until the hearing began. At the hearing, it was
stipulated that the issue was whether the Company had "just cause
to discharge
Page 484 U. S. 34
the Grievant under Rule II.1" and, "[i]f not, what, if any,
should be the remedy." App. to Pet. for Cert. 26a.
The arbitrator upheld the grievance and ordered the Company to
reinstate Cooper with backpay and full seniority. The arbitrator
based his finding that there was not just cause for the discharge
on his consideration of seven criteria. [
Footnote 5] In particular, the arbitrator found that
the Company failed to prove that the employee had possessed or used
marijuana on company property; finding Cooper in the backseat of a
car and a burning cigarette in the frontseat ashtray was
insufficient proof that Cooper was using or possessed marijuana on
company property.
Id. at 49a-50a. The arbitrator refused
to accept into evidence the fact that marijuana had been found in
Cooper's car on company premises, because the Company did not know
of this fact when Cooper was discharged, and therefore did not rely
on it as a basis for the discharge. [
Footnote 6]
The Company filed suit in District Court, seeking to vacate the
arbitration award on several grounds, one of which was that
ordering reinstatement of Cooper, who had allegedly possessed
marijuana on the plant premises, was contrary to public policy. The
District Court agreed that the award must be set aside as contrary
to public policy because it ran
Page 484 U. S. 35
counter to general safety concerns that arise from the operation
of dangerous machinery while under the influence of drugs, as well
as to state criminal laws against drug possession. The Court of
Appeals affirmed, with one judge dissenting. The court ruled that
reinstatement would violate the public policy "against the
operation of dangerous machinery by persons under the influence of
drugs or alcohol." 768 F.2d 739, 743 (CA5 1986). The arbitrator had
found that Cooper was apprehended on company premises in an
atmosphere of marijuana smoke in another's car, and that marijuana
was found in his own car on the company lot. These facts
established that Cooper had violated the Company's rules, and gave
the Company just cause to discharge him. The arbitrator did not
reach this conclusion because of a "narrow focus on Cooper's
procedural rights" that led him to ignore what he "knew was in fact
true: that Cooper did bring marijuana onto his employer's
premises."
Ibid. Even if the arbitrator had not known of
this fact at the time he entered his award, "it is doubtful that
the award should be enforced today in light of what is now known."
Ibid.
Because the Courts of Appeals are divided on the question of
when courts may set aside arbitration awards as contravening public
policy, [
Footnote 7] we granted
the Union's petition for a writ of certiorari, 479 U.S. 1029
(1987), and now reverse the judgment of the Court of Appeals.
Page 484 U. S. 36
II
The Union asserts that an arbitral award may not be set aside on
public policy grounds unless the award orders conduct that violates
the positive law, which is not the case here. But, in the
alternative, it submits that, even if it is wrong in this regard,
the Court of Appeals otherwise exceeded the limited authority that
it had to review an arbitrator's award entered pursuant to a
collective bargaining agreement. Respondent, on the other hand,
defends the public policy decision of the Court of Appeals but,
alternatively, argues that the judgment below should be affirmed
because of erroneous findings by the arbitrator. We deal first with
the opposing alternative arguments.
A
Collective bargaining agreements commonly provide grievance
procedures to settle disputes between union and employer with
respect to the interpretation and application of the agreement and
require binding arbitration for unsettled grievances. In such
cases, and this is such a case, the Court made clear almost 30
years ago that the courts play only a limited role when asked to
review the decision of an arbitrator. The courts are not authorized
to reconsider the merits of an award, even though the parties may
allege that the award rests on errors of fact or on
misinterpretation of the contract.
"The refusal of courts to review the merits of an arbitration
award is the proper approach to arbitration under collective
bargaining agreements. The federal policy of settling labor
disputes by arbitration would be undermined if courts had the final
say on the merits of the awards."
Steelworkers v. Enterprise Wheel & Car Corp.,
363 U. S. 593,
363 U. S. 596
(1960). As long as the arbitrator's award "draws its essence from
the collective bargaining agreement," and is not merely "his own
brand of industrial justice," the award is legitimate.
Id.
at
363 U. S.
597.
"The function of the court is very limited when the parties have
agreed to submit all questions of contract interpretation
Page 484 U. S. 37
to the arbitrator. It is confined to ascertaining whether the
party seeking arbitration is making a claim which, on its face, is
governed by the contract. Whether the moving party is right or
wrong is a question of contract interpretation for the arbitrator.
In these circumstances, the moving party should not be deprived of
the arbitrator's judgment, when it was his judgment and all that it
connotes that was bargained for."
"The courts, therefore, have no business weighing the merits of
the grievance, considering whether there is equity in a particular
claim, or determining whether there is particular language in the
written instrument which will support the claim."
Steelworkers v. American Mfg. Co., 363 U.
S. 564,
363 U. S.
567-568 (1960) (emphasis added; footnote omitted).
See also AT&T Technologies, Inc. v. Communications
Workers, 475 U. S. 643,
475 U. S.
649-650 (1986).
The reasons for insulating arbitral decisions from judicial
review are grounded in the federal statutes regulating
labor-management relations. These statutes reflect a decided
preference for private settlement of labor disputes without the
intervention of government: The Labor Management Relations Act of
1947, 61 Stat. 154, 29 U.S.C. § 173(d), provides that
"[f]inal adjustment by a method agreed upon by the parties is
hereby declared to be the desirable method for settlement of
grievance disputes arising over the application or interpretation
of an existing collective bargaining agreement."
See also AT&T Technologies, supra, at
475 U. S. 650.
The courts have jurisdiction to enforce collective bargaining
contracts, but where the contract provides grievance and
arbitration procedures, those procedures must first be exhausted
and courts must order resort to the private settlement mechanisms
without dealing with the merits of the dispute. Because the parties
have contracted to have disputes settled by an arbitrator chosen by
them, rather than by a judge, it is the arbitrator's view of the
facts and of the meaning
Page 484 U. S. 38
of the contract that they have agreed to accept. Courts thus do
not sit to hear claims of factual or legal error by an arbitrator
as an appellate court does in reviewing decisions of lower courts.
To resolve disputes about the application of a collective
bargaining agreement, an arbitrator must find facts, and a court
may not reject those findings simply because it disagrees with
them. The same is true of the arbitrator's interpretation of the
contract. The arbitrator may not ignore the plain language of the
contract, but the parties having authorized the arbitrator to give
meaning to the language of the agreement, a court should not reject
an award on the ground that the arbitrator misread the contract.
Enterprise Wheel, supra, at
363 U. S. 599.
So, too, where it is contemplated that the arbitrator will
determine remedies for contract violations that he finds, courts
have no authority to disagree with his honest judgment in that
respect. If the courts were free to intervene on these grounds, the
speedy resolution of grievances by private mechanisms would be
greatly undermined. Furthermore, it must be remembered that
grievance and arbitration procedures are part and parcel of the
ongoing process of collective bargaining. It is through these
processes that the supplementary rules of the plant are
established. As the Court has said, the arbitrator's award settling
a dispute with respect to the interpretation or application of a
labor agreement must draw its essence from the contract, and cannot
simply reflect the arbitrator's own notions of industrial justice.
But as long as the arbitrator is even arguably construing or
applying the contract and acting within the scope of his authority,
that a court is convinced he committed serious error does not
suffice to overturn his decision. Of course, decisions procured by
the parties through fraud or through the arbitrator's dishonesty
need not be enforced. But there is nothing of that sort involved in
this case.
Page 484 U. S. 39
B
The Company's position, simply put, is that the arbitrator
committed grievous error in finding that the evidence was
insufficient to prove that Cooper had possessed or used marijuana
on company property. But the Court of Appeals, although it took a
distinctly jaundiced view of the arbitrator's decision in this
regard, was not free to refuse enforcement because it considered
Cooper's presence in the white Cutlass, in the circumstances, to be
ample proof that Rule II.1 was violated. No dishonesty is alleged;
only improvident, even silly, factfinding is claimed. This is
hardly a sufficient basis for disregarding what the agent appointed
by the parties determined to be the historical facts.
Nor was it open to the Court of Appeals to refuse to enforce the
award because the arbitrator, in deciding whether there was just
cause to discharge, refused to consider evidence unknown to the
Company at the time Cooper was fired. The parties bargained for
arbitration to settle disputes, and were free to set the procedural
rules for arbitrators to follow if they chose. Article VI of the
agreement, entitled "Arbitration Procedure," did set some ground
rules for the arbitration process. It forbade the arbitrator to
consider hearsay evidence, for example, but evidentiary matters
were otherwise left to the arbitrator. App.19. Here the arbitrator
ruled that, in determining whether Cooper had violated Rule II.1,
he should not consider evidence not relied on by the employer in
ordering the discharge, particularly in a case like this, where
there was no notice to the employee or the Union prior to the
hearing that the Company would attempt to rely on after-discovered
evidence. This, in effect, was a construction of what the contract
required when deciding discharge cases: an arbitrator was to look
only at the evidence before the employer at the time of discharge.
As the arbitrator noted, this approach was consistent with the
practice
Page 484 U. S. 40
followed by other arbitrators. [
Footnote 8] And it was consistent with our observation in
John Wiley & Sons, Inc. v. Livingston, 376 U.
S. 543,
376 U. S. 557
(1964), that, when the subject matter of a dispute is arbitrable,
"procedural" questions which grow out of the dispute and bear on
its final disposition are to be left to the arbitrator.
Under the Arbitration Act, the federal courts are empowered to
set aside arbitration awards on such grounds only when "the
arbitrators were guilty of misconduct . . . in refusing to hear
evidence pertinent and material to the controversy." 9 U.S.C. §
10(c).
See Commonwealth Coatings Corp. v. Continental Casualty
Co., 393 U. S. 145
(1968). [
Footnote 9] If we
apply that same standard here, and assume that the arbitrator erred
in refusing to consider the disputed evidence, his error was not in
bad faith or so gross as to amount to affirmative misconduct.
[
Footnote 10] Finally, it is
worth noting that putting
Page 484 U. S. 41
aside the evidence about the marijuana found in Cooper's car
during this arbitration did not forever foreclose the Company from
using that evidence as the basis for a discharge.
Even if it were open to the Court of Appeals to have found a
violation of Rule II.1 because of the marijuana found in Cooper's
car, the question remains whether the court could properly set
aside the award because, in its view, discharge was the correct
remedy. Normally, an arbitrator is authorized to disagree with the
sanction imposed for employee misconduct. In
Enterprise
Wheel, for example, the arbitrator reduced the discipline from
discharge to a 10-day suspension. The Court of Appeals refused to
enforce the award, but we reversed, explaining that, though the
arbitrator's decision must draw its essence from the agreement,
he
"is to bring his informed judgment to bear in order to reach a
fair solution of a problem.
This is especially true when it
comes to formulating remedies."
363 U.S. at
363 U. S. 597
(emphasis added). The parties, of course, may limit the discretion
of the arbitrator in this respect, and it may be, as the Company
argues, that, under the contract involved here, it was within the
unreviewable discretion of management to discharge an employee once
a violation of Rule II.1 was found. But the parties stipulated that
the issue before the arbitrator was whether there was "just" cause
for the discharge, and the arbitrator, in the course of his
opinion, cryptically observed that Rule II.1
Page 484 U. S. 42
merely listed causes for discharge, and did not expressly
provide for immediate discharge. Before disposing of the case on
the ground that Rule II.1 had been violated and discharge was
therefore proper, the proper course would have been remand to the
arbitrator for a definitive construction of the contract in this
respect.
C
The Court of Appeals did not purport to take this course, in any
event. Rather, it held that the evidence of marijuana in Cooper's
car required that the award be set aside because to reinstate a
person who had brought drugs onto the property was contrary to the
public policy "against the operation of dangerous machinery by
persons under the influence of drugs or alcohol." 768 F.2d at 743.
We cannot affirm that judgment.
A court's refusal to enforce an arbitrator's award under a
collective bargaining agreement because it is contrary to public
policy is a specific application of the more general doctrine,
rooted in the common law, that a court may refuse to enforce
contracts that violate law or public policy.
W. R. Grace &
Co. v. Rubber Workers, 461 U. S. 757,
334 U. S. 766
(1983);
Hurd v. Hodge, 334 U. S. 24,
334 U. S. 34-35
(1948). That doctrine derives from the basic notion that no court
will lend its aid to one who founds a cause of action upon an
immoral or illegal act, and is further justified by the observation
that the public's interests in confining the scope of private
agreements to which it is not a party will go unrepresented unless
the judiciary takes account of those interests when it considers
whether to enforce such agreements.
E.g., McMullen v.
Hoffman, 174 U. S. 639,
174 U. S.
654-655 (1899);
Twin City Pipe Line Co. v. Harding
Glass Co., 283 U. S. 353,
283 U. S.
356-358 (1931). In the common law of contracts, this
doctrine has served as the foundation for occasional exercises of
judicial power to abrogate private agreements.
Page 484 U. S. 43
In
W.R. Grace, we recognized that "a court may not
enforce a collective bargaining agreement that is contrary to
public policy," and stated that "the question of public policy is
ultimately one for resolution by the courts." 461 U.S. at
461 U. S. 766.
We cautioned, however, that a court's refusal to enforce an
arbitrator's
interpretation of such contracts is limited
to situations where the contract, as interpreted, would violate
"some explicit public policy" that is "well defined and dominant,
and is to be ascertained
by reference to the laws and legal
precedents, and not from general considerations of supposed public
interests.'" Ibid. (quoting Muschany v. United
States, 324 U. S. 49,
324 U. S. 66
(1945)). In W.R. Grace, we identified two important public
policies that were potentially jeopardized by the arbitrator's
interpretation of the contract: obedience to judicial orders and
voluntary compliance with Title VII of the Civil Rights Act of
1964. We went on to hold that enforcement of the arbitration award
in that case did not compromise either of the two public policies
allegedly threatened by the award. Two points follow from our
decision in W. R. Grace. First, a court may refuse to
enforce a collective bargaining agreement when the specific terms
contained in that agreement violate public policy. Second, it is
apparent that our decision in that case does not otherwise sanction
a broad judicial power to set aside arbitration awards as against
public policy. Although we discussed the effect of that award on
two broad areas of public policy, our decision turned on our
examination of whether the award created any explicit conflict with
other "laws and legal precedents," rather than an assessment of
"general considerations of supposed public interests." 461 U.S. at
461 U. S. 766.
At the very least, an alleged public policy must be properly framed
under the approach set out in W.R. Grace, and the
violation of such a policy must be clearly shown if an award is not
to be enforced.
Page 484 U. S. 44
As we see it, the formulation of public policy set out by the
Court of Appeals did not comply with the statement that such a
policy must be "ascertained
by reference to the laws and legal
precedents, and not from general considerations of supposed public
interests.'" Ibid. (quoting Muschany v. United States,
supra, at 324 U. S. 66).
The Court of Appeals made no attempt to review existing laws and
legal precedents in order to demonstrate that they establish a
"well-defined and dominant" policy against the operation of
dangerous machinery while under the influence of drugs. Although
certainly such a judgment is firmly rooted in common sense, we
explicitly held in W.R. Grace that a formulation of public
policy based only on "general considerations of supposed public
interests" is not the sort that permits a court to set aside an
arbitration award that was entered in accordance with a valid
collective bargaining agreement.
Even if the Court of Appeals' formulation of public policy is to
be accepted, no violation of that policy was clearly shown in this
case. In pursuing its public policy inquiry, the Court of Appeals
quite properly considered the established fact that traces of
marijuana had been found in Cooper's car. Yet the assumed
connection between the marijuana gleanings found in Cooper's car
and Cooper's actual use of drugs in the workplace is tenuous, at
best, and provides an insufficient basis for holding that his
reinstatement would actually violate the public policy identified
by the Court of Appeals "against the operation of dangerous
machinery by persons under the influence of drugs or alcohol." 768
F.2d at 743. A refusal to enforce an award must rest on more than
speculation or assumption.
In any event, it was inappropriate for the Court of Appeals
itself to draw the necessary inference. To conclude from the fact
that marijuana had been found in Cooper's car that Cooper had ever
been or would be under the influence of marijuana while he was on
the job and operating dangerous machinery is an exercise in
factfinding about Cooper's use of
Page 484 U. S. 45
drugs and his amenability to discipline, a task that exceeds the
authority of a court asked to overturn an arbitration award. The
parties did not bargain for the facts to be found by a court, but
by an arbitrator chosen by them who had more opportunity to observe
Cooper and to be familiar with the plant and its problems. Nor does
the fact that it is inquiring into a possible violation of public
policy excuse a court for doing the arbitrator's task. If
additional facts were to be found, the arbitrator should find them
in the course of any further effort the Company might have made to
discharge Cooper for having had marijuana in his car on company
premises. Had the arbitrator found that Cooper had possessed drugs
on the property, yet imposed discipline short of discharge because
he found as a factual matter that Cooper could be trusted not to
use them on the job, the Court of Appeals could not upset the award
because of its own view that public policy about plant safety was
threatened. [
Footnote 11] In
this connection, it should also be noted that the award ordered
Cooper to be reinstated in his old job or in an equivalent one for
which he was qualified. It is by no means clear from the record
that Cooper would pose a serious threat to the asserted public
policy in every job for which he was qualified. [
Footnote 12]
The judgment of the Court of Appeals is reversed.
So ordered.
Page 484 U. S. 46
[
Footnote 1]
App. 20-21. The language quoted is from Article XI of the
agreement, which concerns maintenance of discipline. Article VI of
the agreement sets out the arbitration procedure.
Id. at
18-20. The reserved rights of management are specified in Article
IV of the agreement.
Id. at 13-15.
[
Footnote 2]
Rule II.1 lists the following as causes for discharge:
"Bringing intoxicants, narcotics, or controlled substances into,
or consuming intoxicants narcotics or controlled substances in the
plant, or on plant premises. Reporting for duty under the influence
of intoxicants, narcotics, or controlled substances."
App. to Pet. for Cert. 31a.
[
Footnote 3]
Cooper later pleaded guilty to that charge, which was not
related to his being in a car with a lighted marijuana cigarette in
it. The authorities chose not to prosecute for the latter
incident.
[
Footnote 4]
The Company asserted that being in a car with a lit marijuana
cigarette was a direct violation of the company rule against having
an illegal substance on company property. App. 23.
[
Footnote 5]
These considerations were the reasonableness of the employer's
position, the notice given to the employee, the timing of the
investigation undertaken, the fairness of the investigation, the
evidence against the employee, the possibility of discrimination,
and the relation of the degree of discipline to the nature of the
offense and the employee's past record.
[
Footnote 6]
The arbitrator stated:
"One of the rules in arbitration is that the Company must have
its proof in hand before it takes disciplinary action against an
employee. The Company does not take the disciplinary action and
then spend eight months digging up supporting evidence to justify
its actions. In addition, the use of the gleanings evidence
prevented the Grievant from knowing the full extent of the charge
against him. Who knows what action the Grievant or the Union would
have taken if the gleanings evidence had been made known from the
outset of the Company's investigation."
App. to Pet. for Cert. 47a.
[
Footnote 7]
The decision below accords with the broader view of the courts'
power taken by the First and Seventh Circuits.
See, e.g.,
United States Postal Service v. American Postal Workers Union,
AFL-CIO, 736 F.2d 822 (CA1 1984);
E.I. DuPont de Nemours
and Co. v. Grasselli Employees Independent Assn. of East Chicago,
Inc., 790 F.2d 611 (CA7),
cert. denied, 479 U.S. 853
(1986). A narrower view has been taken by the Ninth and District of
Columbia Circuits.
See, e.g., Bevles Co. v. Teamsters Local
986, 791 F.2d 1391 (CA9 1986);
Northwest Airlines, Inc. v.
Air Line Pilots Assn. International, 257 U.S.App.D.C. 181, 808
F.2d 76 (1987);
American Postal Workers Union v. United States
Postal Service, 252 U.S.App.D.C. 169, 789 F.2d 1 (1986).
[
Footnote 8]
Labor arbitrators have stated that the correctness of a
discharge "must stand or fall upon the reason given at the time of
discharge,"
see, e.g., West Va. Pulp & Paper Co., 10
Lab. Arb. 117, 118 (1947), and arbitrators often, but not always,
confine their considerations to the facts known to the employer at
the time of the discharge. O. Fairweather, Practice and Procedure
in Labor Arbitration 303-306 (2d ed.1983); F. Elkouri & E.
Elkouri, How Arbitration Works 634-635 (3d ed.1973).
[
Footnote 9]
The Arbitration Act does not apply to "contracts of employment
of . . . workers engaged in foreign or interstate commerce," 9
U.S.C. § 1, but the federal courts have often looked to the Act for
guidance in labor arbitration cases, especially in the wake of the
holding that § 301 of the Labor Management Relations Act, 1947, 61
Stat. 156, 29 U.S.C. § 185, empowers the federal courts to fashion
rules of federal common law to govern "[s]uits for violation of
contracts between an employer and a labor organization" under the
federal labor laws.
Textile Workers v. Lincoln Mills,
353 U. S. 448
(1957) (construing 29 U.S.C. § 185).
See, e.g., Ludwig Honold
Mfg. Co. v. Fletcher, 405 F.2d 1123 (CA3 1969);
Pietro
Scalzitti Co. v. International Union of Operating Engineers, Local
No. 150, 351 F.2d 576 (CA7 1965).
[
Footnote 10]
Even in the very rare instances when an arbitrator's procedural
aberrations rise to the level of affirmative misconduct, as a rule,
the court must not foreclose further proceedings by settling the
merits according to its own judgment of the appropriate result,
since this step would improperly substitute a judicial
determination for the arbitrator's decision that the parties
bargained for in the collective bargaining agreement. Instead, the
court should simply vacate the award, thus leaving open the
possibility of further proceedings if they are permitted under the
terms of the agreement. The court also has the authority to remand
for further proceedings when this step seems appropriate.
See,
e.g., Amalgamated Food & Allied Workers Union, Local 56 v.
Great A&P Tea Co., 415 F.2d 186 (CA3 1969) (vacating and
remanding to the arbitrators for decision after finding that the
arbitrators declined to arbitrate the issues submitted).
See
also 9 U.S.C. § 10(e) ("Where an award is vacated and the time
within which the agreement required the award to be made has not
expired, the court may, in its discretion, direct a rehearing by
the arbitrators").
[
Footnote 11]
The issue of safety in the workplace is a commonplace issue for
arbitrators to consider in discharge cases, and it was a matter for
the arbitrator in the first instance to decide whether Cooper's
alleged use of drugs on the job would actually pose a danger. That
is not a problem here, for the arbitrator recognized that being
under the influence of marijuana while operating slitter-rewinder
machinery was indeed dangerous, and no one disputed this point.
[
Footnote 12]
We need not address the Union's position that a court may refuse
to enforce an award on public policy grounds only when the award
itself violates a statute, regulation, or other manifestation of
positive law, or compels conduct by the employer that would violate
such a law.
JUSTICE BLACKMUN, with whom JUSTICE BRENNAN joins,
concurring.
I join the Court's opinion, but write separately to underscore
the narrow grounds on which its decision rests and to emphasize
what it is
not holding today. In particular, the Court
does not reach the issue upon which certiorari was granted: whether
a court may refuse to enforce an arbitration award rendered under a
collective bargaining agreement on public policy grounds only when
the award itself violates positive law or requires unlawful conduct
by the employer. The opinion takes no position on this issue.
See ante at
484 U. S. 45, n.
12. Nor do I understand the Court to decide, more generally, in
what way, if any, a court's authority to set aside an arbitration
award on public policy grounds differs from its authority, outside
the collective bargaining context, to refuse to enforce a contract
on public policy grounds. Those issues are left for another
day.
I agree with the Court that the judgment of the Court of Appeals
must be reversed, and I summarize what I understand to be the three
alternative rationales for the Court's decision:
1. The Court of Appeals exceeded its authority in concluding
that the company's discharge of Cooper was proper under the
collective bargaining agreement. The Court of Appeals erred in
considering evidence that the arbitrator legitimately had excluded
from the grievance process, in second-guessing the arbitrator's
factual finding that Cooper had not violated Rule II.1, and in
assessing the appropriate sanction under the agreement.
See
Steelworkers v. American Mfg. Co., 363 U.
S. 564,
363 U. S.
567-568 (1960);
Steelworkers v. Enterprise Wheel
& Car Corp., 363 U. S. 593,
363 U. S.
596-597,
363 U. S. 599
(1960). Absent its overreaching, the Court of Appeals lacked any
basis for disagreeing with the arbitrator's conclusion that there
was not "just cause" for discharging Cooper.
See ante at
484 U. S.
39-42.
Page 484 U. S. 47
2. Even if the Court of Appeals properly considered evidence of
marijuana found in Cooper's car and legitimately found a Rule II.1
violation, the public policy advanced by the Court of Appeals does
not support its decision to set aside the award. The reinstatement
of Cooper would not contravene the alleged public policy "against
the operation of dangerous machinery by persons under the influence
of drugs or alcohol." 768 F.2d 739, 743 (CA5 1985). The fact that
an employee's car contains marijuana gleanings does not indicate
that the employee uses marijuana on the job, or that he operates
his machine while under the influence of drugs, let alone that he
will report to work in an impaired state in the future.
See
ante at 44. Moreover, nothing in the record suggests that the
arbitrator's award, which gives the company the option of placing
Cooper in a job equivalent to his old one, would require Cooper to
operate hazardous machinery.
See ante at
484 U. S.
44-45.
3. The public policy formulated by the Court of Appeals may not
properly support a court's refusal to enforce an otherwise valid
arbitration award. In
W.R. Grace & Co. v. Rubber
Workers, 461 U. S. 757
(1983), we stated that the public policy must be founded on
"
laws and legal precedents.'" Id. at 461 U. S. 766,
quoting Muschany v. United States, 324 U. S.
49, 324 U. S. 66
(1945). The Court of Appeals identified no law or legal precedent
that demonstrated an "explicit public policy," 461 U.S. at
461 U. S. 766,
against the operation of dangerous machinery by persons under the
influence of drugs. Far from being "well defined and dominant," as
W.R. Grace prescribed, the Court of Appeals' public policy
was ascertained merely "from general considerations of supposed
public interests." Ibid. See ante at 484 U. S. 43. I
do not understand the
Page 484 U. S. 48
Court, by criticizing the company's public policy formulation,
to suggest that proper framing of an alleged public policy under
the approach set out in
W.R. Grace would be sufficient to
justify a court's refusal to enforce an arbitration award on public
policy grounds. Rather, I understand the Court to hold that such
compliance is merely a necessary step if an award is not to be
enforced.
See ante at
484 U. S.
44.
It is on this understanding that I join the opinion of the
Court.