In addition to his three appointments to the Supreme Court, Donald Trump appointed 54 judges to the federal circuit courts. These circuit courts have the final word on thousands of cases each year; a handful of those cases generate headlines, but most get little media coverage.  A recent case out of South Carolina is another reminder of how workers suffer when Republican Presidents and Senators decide who obtains these powerful lifetime appointments. 

Sara Black was a shop steward at a nursing home for military veterans.  Her employer fired her for “bullying” a co-worker, Lisa Pangborn.  The accusation against Ms. Black was that she had “harassed” Ms. Pangborn in an effort to get her to retract a statement Ms. Pangborn had given accusing another co-worker, Shekaria Washington, of misconduct.  The employer further accused Ms. Black of encouraging Ms. Pangborn to submit a second false statement regarding Ms. Washington.

Ms. Black’s union filed a grievance regarding her termination and it took that grievance to arbitration.  The collective bargaining agreement (CBA) provided that employees may only be discharged or disciplined for “just cause,” subject to “final and binding” arbitration.  The arbitrator who heard the case determined that the employer lacked just cause to fire Ms. Black, and she ordered the employer to reinstate Ms. Black with backpay.  The arbitrator found that Ms. Pangborn had submitted two contradictory statements regarding Ms. Washington, but the arbitrator credited Ms. Black that she believed the second statement was true.  The second statement, which Ms. Pangborn wrote in her own handwriting, stated that Ms. Pangborn had been coached by a supervisor in writing her original statement.  In crediting Ms. Black’s testimony that she believed the second statement was accurate, the arbitrator noted that Ms. Black had been employed for seven years with no prior discipline and no history of dishonesty.  The arbitrator further noted that while the Union had no power to remove Ms. Pangborn from her job, the employer did have the authority to discipline and discharge Ms. Pangborn.  Thus, faced with her own contradictory statements, “it is possible that she decided that staying with her original statement and dropping the second statement was the safest course of action, no matter what the truth was about why or how she had signed the first statement.”

Rather than comply with the arbitrator’s award, the employer went to court to try to vacate the award.  The district court judge, Margaret Seymour, a Clinton appointee, ruled against the employer.  This was an easy case since the Supreme Court has instructed courts that they must enforce arbitration awards even if the judge is convinced that the arbitrator committed “serious error.”  That’s because by agreeing to submit disputes to arbitration, the parties bargained to have an arbitrator decide the dispute, opting for a forum that is supposed to be faster and more informal than going to court.  In arguing for vacating the arbitration award, the employer asserted that the arbitrator had applied the wrong standard of review of the employer’s decision.  In addition to providing a “just cause” standard for discipline, the CBA stated that “[i]n all discipline cases, the arbitrator shall determine whether [the Employer] had a reasonable basis for concluding that the employee engaged in the conduct for which he/she is being disciplined.”  The arbitrator did not expressly make a determination as to whether the employer had a reasonable basis for its conclusion.  But Judge Seymour found this was not a valid basis for denying enforcement of the award.  Judge Seymour noted that the CBA did not compel a particular outcome upon a finding that the employer had a reasonable basis for its decision, and arbitrators have often considered the reasonableness of the employer’s position as one factor in making a “just cause” determination.

Having lost before both an arbitrator and a district court judge, you might think the employer would give up.  But, instead the employer took its case to the Fourth Circuit Court of Appeals where it had the good fortune of drawing a three-judge panel of two Trump appointees and George H.W. Bush appointee.  The opinion was written by Marvin Quattlebaum, who before he became a judge spent most of his legal career defending corporations in product liability lawsuits.  The other two judges on the panel, Allison Rushing and Paul Niemeyer, were both former corporate lawyers.  While the opinion recited the exceedingly narrow standard of review, the three judges managed to find an exception that allowed them to overrule the arbitrator’s award.  The three judges decided that the contract language instructing the arbitrator to determine whether the employer had a reasonable basis for its decision was a “procedural requirement” rather than a substantive standard.  This is an argument the employer never even made.  The employer’s primary argument was that the arbitrator applied the wrong substantive standard for reviewing its decision to discharge Ms. Black, and its back-up argument was that the arbitrator should have discussed the “reasonable basis” language in her opinion.  These Republican appointees recognized that under controlling Supreme Court precedent they would be required to enforce the arbitrator’s award even if it misinterpreted the CBA.  The only way they could rule for the employer was to recast the argument in procedural terms.  Thus, instead of acknowledging the CBA’s ambiguity – why set forth a “just cause” standard if the arbitrator must uphold any termination if the employer had a reasonable basis for determining that an employee engaged in misconduct – the judges turned the reasonable basis test into a procedural box the arbitrator was required to check on the way to making a substantive determination.

Sarah Black was fired on March 6, 2019.  While her union can arbitrate her termination once more, she has now been out of work for four years, and her co-workers have lost their shop steward for that time.  Without the benefit of a dissenting opinion, the ruling by the three judges on the Fourth Circuit seems routine and unexceptional.  But, the judges had no business setting aside the arbitrator’s award.  Twenty years ago, a unanimous Supreme Court explained that when a union and an employer include an arbitration provision in their collective bargaining agreement, they are “grant[ing] to the arbitrator the authority to interpret the meaning of their contract’s language, including such words as ‘just cause.’”  Here, the employer simply disagreed with the way the arbitrator interpreted the CBA.  I’m not sure what was going through the heads of the three Republican appointees who heard this case.  They may have been trying their hardest to just call “balls and strikes,” but it’s hard to believe that the case would have come out the same way if the panel consisted of three former union lawyers rather than three former corporate lawyers.