F
R
SPECIAL BOARD OF ADJUSTMENT NO. 1048
AWARD NO. 21 (REVISED)
PARTIES TO DISPUTE:
BROTHERHOOD OF MAINTENANCE OF WAY EMPLOYEES
AND
F'
NORFOLK AND WESTERN RAILWAY COMPANY
STATEMENT OF CLAIM:
Claim of the System Committee of the Brotherhood that:
1. The Carrier violated the Agreement when it assigned
outside forces to perform work cleaning railroad
hopper cars at Princeton, West Virginia on March 9,
10, 11, 12, 13, 16, 17, 18, 19, 20, 23, 24, 25, 26,
27, 30 and 31, 1987 (Carrier's File MW-BL-87-29).
2. The Agreement was further violated when the Carrier
failed to give the General Chairman advance written
notice of its plans to contract out said work, in
accordance with Appendix "F" and the December 11,
1981 Letter of Agreement.
3. As a consequence of the violations referred to in
Parts (1) and/or (2) above, Claimants D. Steele, H.
Bond and B. Marsh shall each be allowed one hundred
thirty-six (136) hours pay at the trackman's rate of
pay.
FINDINGS:
Upon the whole record and all evidence, after hearing,
the Board finds that the parties herein are Carrier and Employee
within the meaning of the Railway Labor Act, as amended, and this
Board is duly constituted by agreement under Public Law 89-456
and has jurisdiction of the parties and subject matter.
This is one more in a long line of cases involving the
use by Carrier of an outside contractor to perform certain work
k ]
5eA ioN8
· · Case
c?1
which the Organization alleges accrued to employees covered by
the Maintenance of Way Rules Agreement. Three (3) of the key
elements in this case are (1) the Scope Rule of the Rules
Agreement, (2) Appendix "F" - Contracting out as found in the
Rules Agreement, and (3) the National Letter of Agreement dated
December 11, 1981, by and between the Chairman of the National
Railway Labor Conference and the President of the Brotherhood of
Maintenance of Way Employees.
Rule 1 - Scope reads as follows:
"These rules govern the rates of pay, hours of
service and working conditions of all employees
in the track sub-department and bridge and
building sub-department of the Maintenance of
Way and Structures Department listed in this
rule, and other employees performing similar
work recognized as belonging to and coming
under the jurisdiction of the track and bridge
and building sub-departments of the Maintenance
of Way and Structures Department, but do not
apply to supervisory forces above the rank of
foreman.
The scope of this Agreement will also apply to
employees used in the operation of power driven
machines hereafter introduced in the Maintenance
of Way Department and in the Roadway Material
Yard at Roanoke."
Appendix "F" - Contracting out reads as follows:
"In the event a carrier plans to contract out work
within the scope of the applicable schedule agreement,
the carrier shall notify the General chairman of the
organization involved in writing as far in advance
of the date of the contracting transaction as is
practicable and in any event not less than 15 days
prior thereto.
If the General Chairman, or his representative,
requests a meeting to discuss matters relating to
the said contracting transaction, the designated
representative of the Carrier shall promptly meet
with him for that purpose. Said carrier and
2
5aR
~oNs
~ CczSe
a
1
organization representatives shall make a good
faith attempt to reach an understanding concerning
said contracting, but if no understanding is
reached the carrier may nevertheless proceed with
said contracting, and the organization may file
and progress claims in connection therewith.
Nothing in this Article IV shall affect the
existing rights of either party in connection
with contracting out. Its purpose is to require
the carrier to give advance notice and, if
requested, to meet with the General Chairman or -
his representative to discuss and if possible
reach an understanding in connection therewith.
Existing rules with respect to contracting out
on individual properties may be retained in their
entirety in lieu of this rule by an organization
giving written notice to the carrier involved at
any time within 90 days after the date of this
agreement.
(From National Agreement of May 17, 1968)"
The December 11, 1981 Letter of Agreement referenced
above reads as follows:
"December 11, 1981
Mr. O. M. Berge
President
Brotherhood of Maintenance
of Way Employes (sic)
12050 Woodward Avenue
Detroit, Michigan 48203
Dear Mr. Berge:
The carriers assure you that they will
assert good-faith efforts to reduce the incidence
of subcontracting and increase the use of their
maintenance of way forces to the extent practicable,
including the procurement of rental equipment and
operation thereof by carrier employees.
The parties jointly reaffirm the intent
of Article IV of the May 17, 1968 Agreement that
advance notice requirements be strictly adhered to
3
5aA
10)48
· h
Case
091
and encourage the parties locally to take advantage of the good faith discussions provided for
to reconcile any differences. In the interests
of improving communications between the parties
on subcontracting, the advance notices shall
identify the work to be contracted and the
reasons therefor.
Please indicate your concurrence by
affixing your signature in the space provided
below.
Very truly yours,
/s/ Charles I. Hopkins, Jr.
Charles I. Hopkins, Jr.
I concur:
/s/ O. M. Berge"
From the history of this dispute, as set forth by both
parties without significant contradiction or differences, it is
apparent that as long ago as 1979, Carrier utilized Maintenance
of Way employees to perform certain car cleaning work at
Princeton, West Virginia. The Work continued on an as-needed
basis until sometime in 1985 when the State Environmental
Protection Agency informed Carrier that their car cleaning
operation would have to be closed because of environmental
considerations which apparently existed at that time.
Subsequently, in March, 1987, Carrier resumed car cleaning at
Princeton, West Virginia, but at a location within the Princeton
area different from the area closed in 1985. At this time,
Carrier did not reassign its Maintenance of Way employees to the
work but rather employed the services of an outside contractor to
4
.56A ioN8
0,a6e
a/
effect the cleaning of the cars and the salvaging of the material
cleaned from the cars. No notice was given to the organization
by the carrier relative to this use of the outside contractor.
By letter dated March 31, 1987, the Organization
submitted a penalty time claim for 3 named claimants seeking
compensation of 8 hours for each man on each of seventeen (17)
dates during the month of March, 1987, on which the outside
contractor performed car cleaning work at Princeton, West
Virginia. Carriers officer initially denied the claims alleging
that the car cleaning operation required the use of a "contractor
licensed by the EPA." These claims were advanced to the Engineer
Maintenance - Operations who denied them with the reason "there
was no violation of the schedule agreement or any other
applicable agreement." Upon appeal of the claims to Carrier's
highest level officer designated to handle claims and grievances,
the Organization was told, by letter dated September 16, 1987,
that the claims were denied because (1) they were excessive; (2)
the State EPA prevented Carrier from using its own forces and
"having no other alternative, a contractor registered and
certified by the Environmental Protection Agency of West Virginia
was engaged to clean the cars"; and (3) this operation involved
an unusual or novel situation which exempted it from Appendix "F"
notification. Carrier cited 3rd Division N.R.A.B. Award 20785 in
support of their action and decision.
During subsequent on-property handling of this dispute,
the organization presented to carrier a letter dated October 27,
5
.5,~ io~g
s )
· - G'a 52
dt
1987, from the Chief of the State Department of Natural Resources
in which it was indicated that the State agency did not require
any type of license or permit to effect the type of resource
recovery operation in which Carrier was involved at Princeton,
West Virginia; that the contractor in question was not licensed
c:
by the State to handle hazardous materials; and that the types of
material being handled by the contractor were merely rock, coal
and coke.
The next correspondence of record in this case is from
Carrier under date of May 22, 1989, some eighteen (18) months
later, in which, for the first time of record, Carrier
acknowledged that their previous information relative to EPA
involvement and control was erroneous and those references should
be disregarded by the organization. Carrier then for the first
time contended that the work of cleaning cars was "not work
required by statute or regulation, nor does this work concern the
operation of maintenance of the railroad." Carrier further
contended that no work had been removed from the agreement and
that "since the work contracted in this instance was not within
the scope of your (Maintenance of. Way) agreement, the notice
provisions of Appendix "F" do not apply."
Considerable correspondence and discussion between the
parties followed culminating in a conference on March 22, 1991.
The conference was followed by a response dated March 26, 1991,
wherein carrier summarized their position to include the
contentions that (1) the work in question was not covered by the
6
SBA
IOL48
C0-5e
CIRl
Scope rule; (2) that the practice on the property did not reserve
this work exclusively to Maintenance of Way employees; (3) that
the Claimants were fully employed during the claim period and
therefore were not available to perform the work nor did they
suffer any monetary loss because of the use of the contractor.
Thus the issues were joined on the property for presentation to
this Board for final and binding adjudication.
We will first address the issue of Carrier's somewhat
cavalier attitude displayed by their initial insistence that they
were somehow restricted in the use of the Maintenance of Way
employees versus the use of an outside contractor by limitations
allegedly imposed by the State Environmental Protection Agency
when - in fact - they had no basis for such contentions. The
organization argued strenuously that this line of defense by
Carrier indicated a demonstration of bad faith employed with a
willful intent to dissuade, if possible, the Organization's
progression of their legitimate grievance. The organization
cited with favor 3rd Division N.R.A.B. Awards 26770 and 28044 in
support of their argument that Carrier's lack of good faith
handling was a blatant violation of the spirit and intent of the
December 11, 1981 Letter of Agreement and was sufficiently
egregious to persuade this Board to sustain the claims as
presented on that basis alone.
We have examined the Awards cited supra and do not
seriously disagree with the language and philosophy contained in
each of them. They do not, however, address the type of
7
60A
I
o X18
C:aS
e. fZ I
situation which we have in this instance. Here the Carrier did
indeed show a lack of investigative concern when initially
addressing the grievance. They accepted at face value and
without question the "story" fabricated by the officer who
initially received and handled the claims. However, when the
correct fact situation was set forth by the organization - as is `-
the primary responsibility of the moving party in a dispute -
Carrier acknowledged, albeit belatedly, their erroneous position
and this case continued to be discussed and re-discussed on the
property over a period of more than three (3) years on the basis
of the correct fact situation along with the respective arguments
and positions. There was not, in this Board's opinion, an
absence of good faith claim handling once the "true facts" were
brought forth. We, therefore, reject this contention as advanced
by the organization.
At page 50 of their ex-parte submission to this Board the
organization states that:
"EACH AND EVERY INSTANCE OF CONTRACTING OUT OF
WORK MUST BE VIEWED ON ITS INDIVIDUAL MERITS. TO
HOLD OTHERWISE IS CONTRARY TO THE INTENT AND _
PURPOSE OF ARTICLE IV AND THE DECEMBER 11, 1981
LETTER OF AGREEMENT."
This Board will do just that by examining the Scope rule here
involved. As evidenced by the language of that rule - quoted
earlier in this Award - the Scope rule on this property is a
"general" scope rule which does not specifically delineate items
of work which are reserved to employees working under its
jurisdiction.
8
SaA
1oqg
Case
st
In this case it is unchallenged that Carrier has used
many classes of employees - including outside contractors - to
perform car cleaning work at various locations throughout its
system. It is also unchallenged that at the location in question
Maintenance of Way employees were used to perform car cleaning
work for a period of about six (6) years prior to the incident r'
here in dispute. Carrier contends that the Organization must
prove that they have the "exclusive" right to clean cars. They
point with favor to 3rd Division N.R.A.B. Awards 19969, 28786,
28788 and Award #10 of P.L.B. 3445, among others, in support of
their contention relative to an application of the "exclusivity"
theory to cases arising under the provisions of Appendix "F" -
Contracting Out as it relates to the Scope rule.
Appendix "F" has been quoted earlier in this Award. Its
language - and the language of the related December 11, 1981
Letter of Agreement - is the product of several knowledgeable,
sophisticated labor relations minds from both the Carriers and
the organization. Its language makes reference to work "within
the scope of the applicable schedule agreement." Nowhere in
Appendix "F" is the word "exclusive" or "exclusively" to be _,
found. The "exclusivity" theory has been argued from every
possible angle. The parties to this dispute have presented to
this Board a plethora of awards which, they say, support their
divergent contentions on this issue. We have read and studied
each and every award that was presented on this issue in this
case. From our review and study, we are convinced that the
9
-S6A
ioyg
. k
Ca.Se
"exclusivity" theory has no application in deciding cases
involving Appendix "F" - Contracting Out. We are further
convinced that the issue of "exclusivity" has - or should have
been - put to final rest, especially on this property, by the
issuance of 3rd Division N.R.A.B. Award Nos. 19574, 19578 and
c
19860. Added to this strong line of precedential support are 3rd
Division N.R.A.B. Awards 23560 and 28513. Carriers repeated
argument on this same issue is again - and hopefully for the last
time - rejected. The work here in dispute was by an extended
practice at Princeton, West Virginia, "within the scope of the
applicable schedule agreement." Therefore, before Carrier had
the right to use an outside contractor to do this Work at
Princeton, West Virginia, they had the obligation to give the
notice required by Appendix "F" and the responsibility to engage
in the "good faith discussions" required by the December 11, 1981
Letter of Agreement.
At this point in our determination, we must address an
issue which was raised by the Carrier at an executive session of
this Board following the initial issuance of the proposed award.
At that time, Carrier argued strenuously that the December il,
1981 Letter of Agreement had no standing on this property
inasmuch as the complete rules agreement between the Carrier and
this Union was re-written as of July 1, 1986, and the December
11, 1981 Letter of Agreement was not specifically mentioned or
displayed therein. Carrier acknowledges that Appendix "F" of the
re-written 1986 rules agreement is a reproduction of the original
10
5GA
raLi8
Case C91
Article IV of the May 17, 1968 National Agreement which deals
with the subject of contracting work and the notice requirements
attendant therewith. Carrier argues, however, that inasmuch as
the December 11, 1981 Letter of Agreement was not specifically by
inclusion or reference contained in the 1986 re-written rules
agreement, it was abandoned by all of the parties signatory to
the re-written rules agreement and is now a nullity on this
property.
Not only is this contention new argument raised for the
first time at the executive session of the Board, but also, it is
a misplaced argument. The 1986 re-written rules agreement
preserved in Appendix ''F" thereof the language of Article IV of
the May 17, 1968 National Agreement which deals with the specific
subject here under review. The December 11, 1981 Letter of
Agreement merely reaffirmed the intent of Article IV of the May
17, 1968 Agreement. The Letter of Agreement says just that in
its body. It was not a new or separate rule. It dealt solely
with the subject matter of Article IV of the May 17, 1968
National Agreement. Whether or not the December 11, 1981 Letter
of Agreement was specifically referenced in the 1986_ re-written
rules agreement, the reaffirmation of intent of Article IV of the
May 17, 1968 Agreement as set forth in the December 11, 1981
Letter of Agreement remains in full force and and effect on this
property as long as the terms and conditions of the original
Article IV of the May 17, 1968 Agreement remain in effect.
11
54,9 1014$
Case o°71
Having determined that Carrier did, in fact, violate the
advance notice provisions of Appendix "F", we now turn to the
issue of the measure of damages. Carrier has argued that the
claimants were fully employed during the period of the claim and
therefore have suffered no loss. The Organization, on the other
hand, points to Carrier's repeated violations of Appendix 'IF" and
argue that there is precedential support for the granting of
affirmative relief to the Claimants even though they may have.
been regularly employed during the period of the dispute.
The parties concede that there is a substantial
divergence of arbitral opinion on the issue of damages where no
actual loss has been established. Again the parties have each
presented numerous awards which, they say, support their
respective positions. And again, we have read and studied each
of the awards which have been submitted for our consideration.
On this issue, we are compelled to note that this Board
has no equity powers. This Board is a creature of an agreement
made by and between the respective parties. We do not have
authority or jurisdiction "to change existing agreements
governing rates of pay, rules and working conditions, and shall -
not have the right to write new rules." * We rule on issues and
arguments raised during on-property handling of a dispute. We
are not a de nova tribunal. Rather, we are an appellate tribunal
whose limits of authority are delineated by the agreement which
created the Board. We interpret and apply agreements and rules
*Excerpted from Paragraph 2 of Agreement-dated-March 22, 1991
creating S.B.A. #1048.
12
SQA
~oNg
,
CaS e
a
as written by the parties. We do not, however, operate in a
vacuum. Just as we have to rely on common law principles of
contract interpretation when determining whether or not a
contract has been violated, we also must rely on common law
principles relating to damages when determining appropriate
remedies for such violations. In the agreements here involved,
the parties who gave life and meaning to the agreements did not
see fit to include a penalty provision to be applied in the event
of a violation of the agreement even though there is nothing
inherently wrong in having a penalty provision in a contract or
agreement. In fact, many agreements do contain their own measure
of damages for violations thereof.
The basic common law on damages requires that an employee
prove he has suffered monetary damages. For this Board to
require the payment of punitive damages where none have been
proven, would be, in this Board's opinion, tantamount to writing
a new rule for the parties. Therefore, we reject the
Organization's request for compensation as outlined in Part 3 of
the claim as presented. In support of this decision we offer 3rd
Division N.R.A.B. Award 19574, Award No. 55, P.L.B. 2037 and
Award No. 40, P.L.B. 3657 as precedent.
While we sympathize with the frustration felt by the
organization where, as here, the carrier has repeatedly thumbed
their nose at the agreement, we strongly suspect that this issue
will be resolved elsewhere by the aggrieved party. We do not,
however, believe that two (2) "wrongs" will make a "right." For
13
SGA loqg
C cc.5 a
a
I
this Board to award punitive or affirmative damages where none
are provided for in the agreement of the parties would be just as
wrong as is carrier's repeated violation of the agreement. We
would repeat to the Carrier the advice which was proffered by 3rd
Division N.R.A.B. Award 19574 to the effect that "calculated
violation of the contract, such as in this case, cannot lead to a
constructive relationship between the parties." We would add
that continued failure to abide by the terms of Appendix
'IF"
and
repeated instances of ignoring the provisions and conditions of
nationally negotiated Letters of Agreement such as the December
11, 1981 Letter of Agreement, will surely generate additional
decisions such as found in 3rd Division N.R.A.B. Award No. 28513,
26770 and 27189.
AWARD:
Claim disposed of as outlined in the FINDINGS.
J es E. Mason
hi s . T
airmEan and Neutral Member
`~.s~ ~~Ix.°~iu,~l7~t.~ ,i
- O
.TfCI?TlH
Richard A. Lau ~//fsP/~fs
~f~l,Ct
L. F. `Mill
r,
Tr. ,fru~. a /rofr~
Organization member Carrier Me ber ,roc
4t
"_4r1
11en .rs<n~-
Re-Issued At Palm Coast, Florida
September 4, 1992
14
ab~c
~aWB
Ga..Se o21
LABOR MEMBER'S DISSENT
TO
AWARD NO. 21 OF SPECIAL BOARD OF ADJUSTMENT NO. 1048
Referee Mason
r:
One school of thought adhered to by certain railroad industry
advocates is that writing dissents is an exercise in futility
because they are neither read nor considered by subsequent
Referees. This Organization does not belong to that school. For,
to accept the theory that dissents are meaningless, is to necessarily accept the conclusion that reason does not prevail in railroad
industry arbitration. Despite all the faults built into this
system, the Organization Member of this Board is not ready to
conclude that reason has become meaningless. Therefore, the
Organization Member has no alternative but to file this emphatic
dissent.
The
Organization Member
whole-heartedly concurs with the
Referee's finding that the Carrier violated the Agreement in this
case. However, the Referee's decision to reject the Organization's
request for compensation is just plainly and simply wrong. In
order to support this erroneous finding, the Referee set forth
three premises and then reasoned from these premises to reach his
conclusion. If one or more of the premises is false, then the
conclusion is obviously invalid. As shall be demonstrated below,
not just one, but all three of the Referee's premises are wrong.
- 1 -
5
l3 A i o
Ll8
G'a.5e oZ(
The Referee held that the common law principles relating to
damages applied in this case and, therefore, because the Claimants
were fully employed it would be a penalty payment if the monetary
r
claims were sustained. The Referee had it wrong on all three
counts. First, he incorrectly applied the common law rule of
damages in this case. Second, without a shred of evidence or
reasoning, he found that there was full employment. Finally, he
seriously confused "damages" and "penalties".
The Referee's first and greatest error was his improper
application of the common law rules on damages in this dispute. No
less an authority than the Supreme Court of the United States has
rejected this type of simplistic application of common law concepts
to collective bargaining agreements. In Transportation Communication Employees Union v. Union Pacific Railroad Company 385 U.S. 157
(1966) the Court stated:
"' ..
A collective bargaining agreement is not an
ordinary contract for the purchase of goods and services,
nor is it governed by the same old common law concepts
which control such private contracts [cases cited]. It is
a generalized code to govern a myriad of cases which the
draftsman cannot wholly anticipate .... The collective
agreement covers the whole employment relationship. It
calls into being a new common law - the common law of a
particular industry or a particular plant."' (Underscoring added)
The following year, the United States Court of Appeals in
Brotherhood of Railroad Signalmen v. Southern Railway, 380 F.2d 59
(1967) said:
. 98A ioqg
` Ca. 5 e
c? I
"Courts have uniformly held that GUNTHER precludes
judicial re-examination of the merits of a Board award.
Thus, beyond question, it is not within our province, or
that of the District Court, to reappraise the record and
determine independently whether Southern violated its
obligations under the collective bargaining agreement
when it denied Brotherhood members the opportunity to
perform the work in question. Southern insists, however,
that with respect to the monetary portions of the awards,
the District Court acted not in conflict with GUNTHER in
limiting Brotherhood to nominal damages on its findings
that the records in both cases contain ~no evidence of
any loss of time, work or gap' by any of the employees
who were designated to receive compensation for the lost
work. In accepting this contention of Southern, the
District Court relied on the common law rule that damages
recoverable for breach of an employment contract are
limited to compensation for lost earnings. The court
reasoned that since GUNTHER permits judicial computation ,
of the size of the monetary awards, it could exercise a
discretion to allow Brotherhood nominal damages only
where its members lost no time.
This approach, however, completely ignores the loss of
opportunities for earnings resulting from the contracting
out of work allocated
by
agreement to Brotherhood members
- a deprivation amounting to a tangible loss of work and
pay for which the Board is not precluded from granting
compensation. Nothing in the record establishes the
unavailability of signalmen to perform the work contracted out by the railroad. The vast number of factual
possibilities which arise in the field of labor relations, and which must be considered by the Board in cases
of this kind, clearly reflects the wisdom of the GUNTHER
rule." (Underscoring added)'
The rationale of the Courts did not go unheeded by the NRAB.
Subsequent to the Signalmen decision literally dozensof Referees
in hundreds of cases have either explicitly or implicitly applied
the reasoning in Signalmen and sustained monetary claims when work
1
The Signalmen case is of particular relevance here inasmuch
as it may be construed as precedent on this property. The Norfolk
Southern Corporation now controls the former Southern Railway and
Norfolk and Western Railway and operates them as a single transportation system.
was improperly removed from the bargaining unit and assigned to
others, thereby causing a loss of the right to perform that work to
the members of the bargaining unit. While no purpose would be
e.
served by citing and quoting all of the awards, we are compelled to
cite a representative sample so that future readers may see just
how wrong this award is:
AWARD 15689: (Third)
^*** However, in those cases the Awards are in
conflict as to whether Claimants were entitled to
compensation for breach of the Agreement during a period
they were on duty and under pay. ***
In Award No. 10963 (1962), in which the present
Referee participated we held that: (1) this Board was
without jurisdiction to impose a penalty; (2) the common
law of damages for breach of contract applied; (3)
damages were limited to actual proven loss of earnings.
In Award No. 13236 (1965) involving the same parties
herein, we reached the same conclusions; and citing
Brotherhood of Railroad Trainmen v. Denver and Rio Grande
Western Railroad Company, 338 F.2d 407 (C.A. 10, 1964),
in which certiorari was later denied, 85 S. Ct. 1330, we
awarded nominal damages.
Subsequent to the Gunther case, on June 20, 1966,
Public Law 89-456, 80 Stat. 208, amending the Act, was
enacted. It provided for severe restraints on the scope
of judicial review of awards of the Railroad Adjustment
Board, all of which is spelled out in Brotherhood of
Railroad Trainmen, et. al. v. Denver and Rio Grande etc.
370 F. 2d 866 (C.A. 10, 1966), cert. den. 87 S. Ct. 1315.
In this second Denver and Rio Grande case, involving the
same parties and issue as in the 1964 case, supra, the
court held 'the Board's determination of the amount of
the award is final absent a jurisdictional defect. The
measure of damages, like the application of affirmative
defenses, offers no jurisdictional question.'
In the period between the Gunther case and the
second Denver and Rio Grande case the Supreme Court on
December 5, 1966, handed down its Opinion in Transportation-Communication Employees Union v.- Union Pacific
Railroad Co. 385 U. S. 157, wherein it stated:
. W 3~
W ~!
8
' CccS~
"'... A collective bargaining agreement is not
an ordinary contract for the purchase of goods
and services, nor is it governed by the same
old common law concepts which control such
private contracts. John Wiley & Sons v.
Livingston, 376 U.S. 543, 550; cf. Steele v.
Louisville & N. R. C., 323 U.S. 192. It is a
generalized code to govern a myriad of cases
which the draftsman cannot wholly anticipate .... The collective agreement covers the
whole employment relationship. It calls into
being a new common law--the common law of a
particular industry or of a particular plant.'
Shortly thereafter the Fourth Circuit, on May 1,
1967, decided Brotherhood of Railroad Signalmen of
America v. Southern Railway Company. In that case the
parties herein were parties therein. The same issues
were raised relative to two of our Awards as in the
instant case both as to the merits and damages -- the
record contained no evidence of any loss of time, work or
pay by any of the employes who were designated in the
Awards to receive compensation for the lost work. The
court reversed the holding of the District Court that
since Gunther permitted judicial computation of the size
of monetary awards it could exercise a discretion to
allow Claimants only nominal damages where they had lost
no time. The court held that the District Court's
approach:
In the light of the amendments of the Act and the
judicial development of the law, cited above, we hold
that when the Railroad Adjustment Board finds a violation
of an agreement it has jurisdiction to award compensation
to Claimants during a period they were on duty and under
pay._
AWARD 16009: (Third
"The most recent judicial pronouncement on the issue
of damages for contract violations where no actual losses
were alleged or shown and the controlling agreement
contains no penalty provisions is found in Brotherhood of
Railroad Signalmen of America v. Southern Railwav
Company, a corporation F. 2d (C. A. 4, decided
May 1, 1967). Therein, the court disavowed the common
law rule that damages recoverable for breach of an
employment contract are limited to compensation for lost
earnings and stated that this Board is not precluded from
granting compensation for the loss of opportunities of
- 5 -
5134 loUB
Caste
"earnings resulting from the contracting out of work
under circumstances similar to those found in this
dispute. We find the Fourth Circuit decision applicable
in this case and will sustain the claim with certain
modifications." (Underlining by Referee)
r'
AWARD 16430: (Thirds
"Carrier contends that Claimants were fully employed
and therefore the compensation sought should not in any
case be granted. But there was a loss of earnings
opportunities and, pursuant to many Awards of this
Division (6063, 6284, 16009), the hours worked by
employees who held no seniority in Territory No. 40 are
a proper measure of the Claimants' loss and should be
paid. ***"
AWARD 19899: (Third
"After a thorough consideration of the various
Awards, the Board continually returns to, and finds
authority in, the determination of the United States
Court of Appeals, Fourth Circuit, in Brotherhood of
Railroad Signalmen of America v. Southern- Railway Company
380 F 2d 59 : 55 CCH Labor Cases 11,941 (May 1, 1967);
rehearing denied (June 9, 1967) 55 CCH Labor Cases 12,
302; cert denied (November 13, 1967) 56 CCH Labor cases
12,272. (Emphasis in original)
In the case, the Court of Appeals considered a lower
Court's refusal to enforce a National Railroad Adjustment
Board award of damages; which refusal was grounded upon
'full employment' at all relevant times. In reversing
and remanding, the Fourth Circuit stated:
'This approach, however, completely ignores
the loss of opportunities for earnings result
ing from the contracting out of work allocated
by agreement to Brotherhood members - a depri
vation amounting to a tangible loss of work
and pay for which the Board is not precluded _
from granting compensation. Nothing in the
record establishes the unavailability of
signalmen to perform the work contracted out
by the railroad. The vast number of factual
possibilities which arise in the field of
labor relations, and which must be considered
by the Board in cases of this kind, clearly
reflects the wisdom of the Gunther Rule
(Gunther v. San Diego and Arizona Eastern
Railroad, 382 US 257 (1965)
- 6 -
.56A i®q8
Case
'Yet, if, whenever no direct lay-off of a
union's members is involved, the employer can
unilaterally contract out work that has been
allocated by agreement to the union, under no
greater threat than liability for merely
nominal damages, the collective agreement
would soon become a worthless scrap of paper.
It requires but slight insight into the realities of human behavior to realize that neither
party would feel bound to abide by an agreement that will not be effectively enforced in
the courts.'
We are not congnizant (sic) of any basic reason why
the rationale of the Fourth Circuit should be adopted and
adhered to by Referees in one line of cases, but ignored
in cases dealing with demonstrated violations of Article
IV of the National Agreement, nor have the Article IV
cases suggested any cogent reason for such a distinction.
Article IV of the National Agreement results from
the free collective bargaining process. While it does
not compel either party to agree, it does require a
Carrier to notify the Organization of plans to contract
out work within the scope of the applicable agreement.
Thereafter, if requested, a meeting shall be held and a
good faith attempt made to reach an understanding
concerning the contracting out.
We have difficulty in hypothicating (sic) many
instances more imperative to loss of opportunities than
a proposed contracting out of bargaining unit work -
which may well result in a severe deprivation amounting
to a substantial tangible loss of work and pay. Article
IV is mandatory in concept. We wonder then if, as noted
by the Fourth Circuit it may become a 'worthless scrap of
paper' if it may be unilaterally ignored. Accordingly,
we favor the rationale of the Fourth Circuit as properly
applied to violations of Article IV. For these stated
reasons, the Board holds that a claim for damages may be
sustained for a violation of Article IV of the 1968
National Agreement even though employees in question were
fully employed at all relevant times. This result does
not compel Carrier to agree to anything or to do anything
other than what it previously agreed to i.e. give notice
and bargain in good faith. While it is urged by Carrier
that damages may be speculative, it is Carrier itself, by
- 7 -
,5 (3A )018
Ca-5e
o21
"its failure to comply with its agreement, who places the
matter in that posture - not the employees.
The Board has considered, but rejected, the approach
to damages in Public Law Board #249 - Docket #16 and
Award 19635 (one of which speak of damages in terms of
one-half
(1)
of the claim and the other, one-half
(1)
of
the amount paid to the outside contractor) for two
reasons. Initially, neither Award states a basis for its
one-half (z) concept and secondly, it seems that a damage
award should deal more specifically with the detailed
loss of opportunity in question. Similarly, we reject
the results of Award 18792 which dealt with payments 'in
futuro'. While that concept may have had a particular
reference to the facts there under consideration, as a
general proposition, it could easily lead to numerous
unforseen (sic) speculations as applied to individual
cases.
Rather, we feel, the Board should award damages, in
each individual case, in direct relationship to the loss
of job opportunity - and a tangible loss of pay -
notwithstanding a 'full employment' situation." (Underscoring in original)
AWARD 21678: (Third
"The only question remaining is relative to appropriate remedy. Claimants seek compensation for 64 hours
of straight time, the amount of time which the Fargo
District gang consumed in performing the disputed work.
Carrier resisted payment of damages even if arcruendo the
Agreement was violated on the grounds that Claimants
suffered no loss of earnings and the Board has no
authority to award damages. We have dealt authoritatively with similar contentions in prior Awards involving
these same parties and concluded that where, as here,
Claimants by Carrier's violation lost their rightful
opportunity to perform the work then they are entitled to
a monetary claim. Nothing on this record persuades us to
deviate from those precedents in this case. See Awards
19899, 19924, 20042, 20338, 20412, 20754, 20892."
(Underscoring in original)
AWARD 24621: Third
"We turn now to Carrier's argument about compensation. Carrier argues that Claimants may not receive
compensation because they were fully employed during the
claim period. The Organization argues that the assignment of this work to outside forces resulted in loss of
work opportunity and related monetary benefits to
"Claimants. We agree. See Awards 12785, 15689, 15888
and others. 'This Board is not precluded from granting
compensation for the loss of opportunities of earnings
resulting from the contracting out of work ...' (Award
16009).
r
The claim is sustained and compensation shall be
paid to Claimants as requested in Claim (3)."
AWARD 25402: (Third
"Furthermore, it cannot be denied that Carrier
actually received benefit from the work performed.
Eventually it would have utilized Claimant's services to
weed-mow the two miles of right of way in question at an
undisputed cost based on 8 hours of straight time pay.
The actions of an unauthorized third party have therefore
conferred financial benefit on Carrier while removing a
commensurate work opportunity from Carrier's Employes.
Though Carrier has exhibited no bad faith here, the
Board concludes that an affirmative duty rests on Carrier -
to enforce the Scope Rule. By reason of the breach of
its Lease Agreement, Carrier would appear to have
recourse, which Organization does not, against the Lessee
for damages, if any, resulting from that breach.
Finally, though Claimant was in fact employed
elsewhere at the time the mowing took place, he has
nevertheless been deprived of a future opportunity to
perform that additional work to which he was rightfully
entitled. Accordingly, the claim must be sustained."
AWARD 29232: (Third)
"The Carrier maintains that the Claim seeks unsubstantiated, excessive hours of pay at improper rates and
that Claimants are not proper. The Organization contends
that the issue of whether Claimants were proper was not
raised by the Carrier during the on-property handling of
this Claim. Moreover, urges the Organization, Claimants
are entitled to the compensation sought by the Claim even
though they worked on the Claim dates and received
compensation therefore because Claimants lost work
opportunities when the Carrier wrongfully assigned the
work to the signal forces. Moreover, the Organization
urges, the Claim represents an attempt to police the
collective bargaining Agreement and require the Carrier
to follow its provisions.
Inasmuch as the issue of whether Claimants are
proper was not raised during the on-property handling of
- 9 -
S6A
IOL48
` Ca5e
al
"the Claim applicable Board rules prohibit the Board from
considering that argument. We agree with the Organiza
tion that Claimants are due compensation despite the fact
they worked and received compensation on the Claim dates.
Claimants in fact did lose work opportunities due to the
Carrier's violation of the Agreement, and this type of r
Claim long has been viewed as a proper device to police
the Agreement."
The above-quoted awards establish that over a period of
twenty-five (25) years, from 1967 through 1992, the NRAB has
consistently and frequently applied the reasoning in Sianalmen and
awarded compensation when work was improperly removed from the
bargaining unit and assigned to strangers, thereby causing a loss
of work opportunity. The fact that the Claimants in each case were
regularly assigned at the time of the violation mattered not. The
compelling point was the lost work opportunity. The application of
the common law rule on damages did not operate to preclude
sustaining monetary claims in these awards and there is no reason
that it should have been so applied here.
After improperly applying the common law rule on damages in
this case, the Referee next compounded his error by referring to
the monetary claim as a "penalty". Apparently, the Referee was
confusing "penalties" with "damages". This issue has also been
examined by the NRAB and thoughtful Referees have consistently
distinguished between "damages" and "penalties" as follows:
- 10 -
,9dA to
L!8
' Ca.Se
AWARD 10033:
"The Carrier in this case has contended that there
were no monetary damages and the argument has been made
by the Carrier on the premises and here that this Board
has no authority to award a penalty.
Since the presidential fact finding Board in 1937
rendered its opinion in which it stated:
'The penalties for violations of rules
seem harsh and there may be some difficulty in
seeing what claim certain individuals have to
the money to be paid in a concrete case. Yet,
experience has shown that if rules are to be
effective there must be adequate penalties for
violations.'
This division and others has continued to characterize awards in such cases as a penalty. The fact is
that what we are dealing with is nothing more than a
Contract violation and an award of damages for such
breach. Granted that in some cases the award may be
greater than the actual damage sustained but as long as
this issue is not properly presented on the premises this
Board has been forced to establish some criterion in the
way of liquidated damages when the facts show that as a
result of the breach some damage potentially flowed. It
is perhaps unfortunate that the word 'penalty' ever crept
into the language of the Board."
AWARD 11701: Third
"We are of the opinion that the fundamental factor
in this dispute is the violation of the Agreement. For
Carrier to concede the breach and then to assert that
Claimant is not entitled to reparations is virtually to
ignore its responsibility as a party to the Agreement.
For an Agreement to be effective, both parties must
uphold .the terms. It is not enough to recognize the
breach without expecting the violator to accept the
consequences for its act. We, therefore, cannot sustain
Carrier's position that Claimant must show that he 'was
in some manner adversely affected by the action of the
Carrier' for this factor is irrelevant and distracts
attention from the real issue of the admitted violation
of the Agreement. The argument that compensation to
Claimant would be in the nature of a penalty is likewise
extraneous, for it brushes aside the sanctity of the
Agreement. Claimant's behavior or employment income are
not the conditions that caused the breach. We regard the
claim as one for damages rather than a claim for a
- 11 -
55A
IOL48
Ga.se
a
1
"penalty. Accordingly, we hold that Mr. Swafford is
entitled to full indemnification for his claim."
AWARD
11937: (Thirds
"Carrier avers that Claimants can show no damages
F.
because they were fully employed at the time the fence
was erected. But, Carrier has adduced no evidence that
Claimants could not have performed the work by working
overtime or that the work could not have been delayed
until a time at which it could be included in Claimants'
work schedule. When a Carrier violates the scope rule of
an Agreement the covered employes have been damaged de
jure; but, the extent of the monetary damages, if any, is
a matter of proof. Where, as here, the violation has
been established, the Claimants have made a prima facie
case of damages as claimed and the burden to rebut, by
factual evidence, shifts to the Carrier. Carrier, in
this case, has not met the burden of negating damages as,
claimed.
Carrier confuses 'damages' and penalties.' While
monetary 'damages' awarded are sometimes loosely referred
to as 'Penalties' the terms are technically distinct.
Technically, in contract law, monetary 'damages' make
whole a person injured by violation of an acLreement;
'penalties' are the assessment of-afineover and above _
damages suffered. Monetary 'penalties' are imposed as
punishment for a violation of a contract with the
objective of deterring like future conduct. Therefore,
the making whole of Claimants herein for work they would
have performed and wages they would have earned, absent
Carrier's violation of the Agreement, is the award of
compensatory 'damages:' not a 'penalty.' ***" (Underscor
ing added)
AWARD
16946: (Third)_
"By its violation, Carrier deprived Claimant of the
opportunity to perform and to be paid for the work,
possibly at overtime rates. We do not see an award to
Claimant of pay for the time spent on the involved work
as a penalty, like a fine for passing a traffic light,
but rather as part of redressing the damage done by
Carrier's violation."
AWARD
19814: Third _
"Insofar as Part 2 of the claim is concerned, having
found that the Agreement was violated in this case, we
now hold that this monetary portion of the claim is one
for damages and not a penalty claim as argued by Carrier,
- 12 -
5~3~, ~o~Ig
' Ca.Se
o?1
"for it is clear from the record that the motivation
behind the claim was primarily to seek enforcement of the
Agreement. Although there are conflicting prior Awards
on the question of 'damages' vs. 'penalties' we feel that
the Opinion of the Board as expressed in Award 11701,
involving the same parties as in the instant case, is
f.
significant and is quoted, in part, as follows:
'Claimant contends that he is entitled to reparations resulting from the violation of the Agreement. Carrier, on the other hand, maintains that
Claimant suffered no loss because he was employed.
Carrier also points out that the compensation
requested by Petitioner is in the nature of a
penalty and that the Agreement makes no provision
for a penalty payment in the event of a violation
of the Agreement.
We are of the opinion that the fundamental factor
in this dispute is the violation of the Agreement.
**** For an Agreement to be effective, both parties
must uphold the terms. It is not enough to recognize the breach without expecting the violator to
accept the consequences for its act. **** The
argument that compensation to Claimant would be in
the nature of a penalty is likewise extraneous, for
it brushes aside the sanctity of the Agreement.
Claimant's behavior or employment income are not
the conditions that caused the breach.'
This principle has been reiterated in numerous other
Awards of this Board, and we subscribe to the reasoning
therein."
In this case, there can be little question that if the Carrier
had not assigned outside contractors to clean the hopper cars at
Princeton, the Claimants would have performed the work. In fact,
the Referee clearly recognized that, "It is also unchallenged that
at the location in question, Maintenance of Way employes were used
to perform car cleaning work for a period of about six (6) years
prior to the incident here in dispute." (Award at 9). Hence, the
inexorable conclusion is that Claimants were damaged when they lost
- 13 -
58A i s q S
Ga52 (9 1
the opportunity to perform the work and receive the concomitant
reparations.
In addition to the general body of awards cited above, it
should be noted that the Norfolk and Western raised precisely and
exactly the same penalty pay argument in Case Nos. 59, 60, 62 and
63 of Public Law Board No. 1837. In each of those cases, the
Referee rejected the N&W's argument and awarded the pay claimed
because the Claimants had been denied the opportunity to perform
the work. Representative of the Referee's ruling in each of these
cases is his award in Case No. 59, which held:
"The Record reveals that the Claimants were fully
qualified and available to perform the work. Although
the Carrier contests their availability, contending that
they were working on assignments elsewhere, this Board
finds that since those assignments had been made BY THE
CARRIER the Claimants are still to be considered available. As the Third Division stated in Award 13832:
'The fact is that Claimants were working where
Carrier has assigned them, hence were not only
available but Carrier was then availing itself
of them. If they were not available at the
time and place where the extra work was to be
done, it was because Carrier chose not to
assign them there.' (See, also Third Division
Awards 19324 and 25964).
With respect to the Carrier's argument that granting
the claim would be considered a penalty or somehow
excessive, this Board states that in numerous awards the
Divisions and various Boards have held that awarding the
pay for rule violations of this kind is appropriate since
the Claimants were, in essence, denied the work."
(Underscoring added)
- 14. -
5'6A IOL48
Cc-5e
o?1
The Referee in Case No. 59 and the like cases mentioned above
sustained the monetary claim because the Claimants had been "denied
the work". This rationale is consistent with a "damages" and not
r'
a "penalty" theory. in addition, See Third Division Award 19542,
Award Nos. 4 and 5 of Public Law Board 249 and Case Nos. 48 and 52
of Public Law Board No. 1837 which held to a similar effect ON THIS
PROPERTY.
The Norfolk and Western Public Law Board awards referenced
above are particularly pertinent here, not only because they are on
this property, but also because of the enabling language in the
Agreements which created these Public Law Boards. In the instant
case, the Referee relied upon the language in the Special Board of
Adjustment Agreement to support his erroneous "penalty" theory. At
Page 15 of the award, he wrote:
"*** This Board is a creature of an agreement made
by and between the respective parties. We do not have
authority or jurisdiction 'to change existing agreements
governing rates of pay, rules and working conditions, and
shall not have the right to write new rules.'* We rule
on issues and arguments raised during on-property
handling of a dispute. We are not a de novo tribunal. ***
*Excerpted from Paragraph 2 of Agreement dated March 22,
1991 creating S.B.A. #1048.11
The problem with the Referee's argument is that the language from
Special Board of Adjustment No. 1048 which he quotes is standard
language in virtually all Public Law Board and Special Board of
- 15 -
5pA ioN8
, ~a.5e ~1
Adjustment Agreements. Virtually identical language appears in the
fourth paragraph of the Agreement that established Public Law Board
No. 1837. As we pointed out above, the Referee in Case Nos. 59,
r'
60, 62 and 63 in Public Law Board No. 1837 sustained the monetary
claims in those cases, notwithstanding the same language which this
Referee apparently found so restrictive to his "authority and
jurisdiction". Case Nos. 59, 60, 62 and 63 resulted in very
substantial monetary payments. If indeed the Carrier believed that
the Special Board of Adjustment language in question restricted the
jurisdiction of the Referee in the manner suggested by this
Referee, one would have expected the Carrier to challenge the
monetary award. Did the Carrier refuse to make the monetary
payments? Absolutely not. Did the Carrier challenge the jurisdiction of the Referee in court? Absolutely not. Instead, the
Carrier paid the awards as directed and then turned right around
and drafted the Special Board of Adjustment No. 1048 agreement, and
included the same type of language under which the Public Law Board
No. 1837 Referee had made the monetary awards in Case Nos. 59, 60,
62 and 63.
While it is certainly not necessary to ascribe to the "penalty
theory" in order to find sound basis for sustaining the monetary
portion of this claim, we would be remiss if we failed to set the
record straight on this issue as well. Although it is not
completely clear, it appears that the Referee has ruled that he has
no authority or jurisdiction to issue a penalty because there is no
- 16 -
S.8A joyg
case
c21
"penalty provision" in the Agreement. Once again, the Referee's
finding is at odds with literally hundreds of awards of the NRAB
and Public Law Boards. In these forums, literally dozens of
r-
Referees have sustained monetary awards to enforce the integrity of -
the agreement, irrespective of a showing of monetary loss. A
sample of these awards, beginning with the early days of the NRAB
and continuing to the present are as follows:
AWARD 685: (Third)
"The objection of the carrier to the payment of -
overtime under Rule 37 must also be overruled. It is
true, as the carrier points out, that the claimant 'was
not required to work regularly in excess of eight hours.'
The Division, however, has found that the carrier made an
improper assignment in this case. Accordingly, the
claim, although it may be described as a penalty, is
meritorious and should be sustained. The Division quotes
with approval this statement from the Report of the
Emergency Board created by the President of the United
States on February 8, 1937:
'The penalties for violations of rules
seem harsh and there may be some difficulty in
seeing what claim certain individuals have the
money to be paid in a concrete case. Yet,
experience has shown that if rules are to be
effective there must be adequate penalties for
violation."
AWARD 2277: Third
"*** The only question arises whether Gardner, who
did not, in fact, do the work, is nevertheless entitled
to be paid therefor, and on an overtime basis of pay, by
reason of the claim that, while not exclusively entitled
to the work, he would have, under ordinary circumstances,
been called on therefor. If we are to allow the claim it
must be done on the basis that the Carrier should be
penalized for its violation of the Agreement, regardless
of the fact that the result thereof would operate to
compensate Gardner for work he did not perform, and on an
overtime basis of pay. To impose this penalty may, in
the circumstances, seem harsh; but Agreements are made to
- 17 -
5OA
IOL48
' " Case
c`2!
"be kept and the imposition of penalties to attain that
end, and to discourage violations, are justified.- As we -
view the matter, less harm will result to the principles
of collective bargaining by imposing the penalty than
from ignoring the violation and refusing to impose the
penalty.
***-I
(Underscoring added)
c
AWARD 12374: Third),
"Carrier urges that the claim is for a penalty
because Claimant actually worked on each of the days for
which the claim is filed; that he received eight (8)
hours of pay at his rate for each of the days; that he
could not have been available for the work done on those
days by the Machine Operators; that the Agreement does
not provide for payment of services not performed; that
this Division has no right to assess a penalty.
A collective bargaining agreement is a joint
undertaking of the parties with duties and responsibilities mutually assumed. Where one of the parties violates
that Agreement a remedy necessarily must follow. To find
that Carrier violated the Agreement and assess no penalty
for that violation is an invitation to the Carrier to
continue to refuse to observe its obligations. If
Carrier's position is sustained it could continue to
violate the Scope Rule and Article I of the Agreement
with impunity as long as no signal employes were on furlough and all of them were actually at work. For
economic or other reasons, Carrier could keep the
Signalmen work force at a minimum and use employes not
covered by the Signalmens' Agreement to perform signal
work. No actual damages could ever be proved. This is
not the intent of the parties nor the purpose of the
Agreement.
While Carrier alone has the right to determine the
size of the work force in any craft, it has a duty and
obligation to keep available an adequate number of
employes so that the terms of the Agreement are not
breached. Carrier is obligated to have a sufficient
number of available signalmen on its roster for its
needs. If it fails to do so, it may not complain when a
penalty is assessed for a contract violation.,,
AWARD 17523: (Third
"The Carrier, furthermore, argues that the instant
claim is in the nature of an exaction--a penalty--as the
claimants were employed on the days in question. We can
only respond that this Carrier is fully familiar with the
hundreds of awards which have held that a Carrier is
- 18 -
5f3A )oN8
O a6
a
o~
"liable in the event of a contract violation; that such
assessment of damages is not an unfair labor practice, as
it alleges."
AWARD 21751: ,(Third)
r'
"The Carrier also asserts 'the monetary payment
being sought by the Organization is improper. Claimant
was fully employed on the dates in question and suffered
no loss of earnings.' Thus under the principle that a
Claimant is limited to the actual pecuniary loss necessarily sustained no monetary payment is due.
The question to be decided here, however, is not
whether the Claimant suffered actual pecuniary loss, but
rather there having been an improper assignment of work
within the terms of the Parties Agreement of work to
which the Claimant was entitled, is he without remedy?
The Organization asserts Claimant under Rule 3 was
entitled to perform the work in his seniority district.
There is no evidence to the contrary as Carrier did not
have the authority to transfer the work, as it contends.
The Organization submits the proper remedy is to pay the
Claimant the rate for the work performed citing many
awards, essentially, assessing such a penalty for
violation, citing, among other Third Division Award 685:
'The Division xxx found that the Carrier made
an improper assignment xxx. Accordingly, the
claim, although it may be described as a
penalty is meritorious and should be sustained. The Division quotes with approval
this statement from the Report of the Emergency Board created by the President of the
United States on February 8, 1937:
"The penalties for violations of
rules seem harsh and there may be
some difficulty in seeing what claim
certain individuals have to the
money to be paid in a concrete case.
Yet experience has shown that if
rules are to be effective, there
must be adequate penalties for violation.
AWARD 27614: Third
"As to the question of damages, Carrier asserts that
Claimants were employed full time when the violation
occurred. While we recognize that there is a divergence
- 19 -
OGA ioq8
. , . , Ca-5e
og f
"of views on this subject, it is our view, and we have so
held in prior cases, that full employment of the Claimants is not a valid defense in a dispute such as involved
here. As we noted in Third Division Award 26593, '. . .
in order to provide for the enforcement of this agree-
ment, the only way it can be effectively enforced is if
t.
a Claimant or Claimants be awarded damages even though
there are no actual losses."'
"With respect to remedy, the Board recognizes that
the Claimants were fully employed during the period that
the work was performed. However, Carrier has not
introduced any evidence that the work could not have been
assigned to the Claimants on either an overtime or
rescheduling of work basis. Clearly a monetary remedy is
appropriate on two grounds: loss of work opportunity and,
further, in order to maintain the integrity of the
Agreement. ***"
AWARD 28241: (Third)_
"*** the Board is not receptive to Carrier's
argument that the violation was merely de minimis or that
Claimants should be denied any recovery because they were
otherwise occupied. This Board has held in numerous
cases that a remedy ordinarily is appropriate where a
violation of an agreement is proven. ***"
AWARD 28513: Third
"*** By the failure to give the required notice, the
Carrier did not give the negotiated procedure set forth
in Article IV an opportunity to unfold. Claimants
therefore clearly lost a potential work opportunity as a
result of the Carrier's failure to follow its contractual
mandate to give the Organization timely notice. Given
this Board's previous admonitions to the Carrier to
comply with the terms of the 1968 National Agreement and
the Carrier's failure to do so and further considering
that the awarding of monetary relief to employees for
violations of contracting out obligations even when the
affected employees were employed is not unprecedented
(see Third Division Award 24621 and Awards cited therein), on balance, we believe that given the circumstances
of this case, such affirmative relief is required in
order to remedy the violation of the Agreement. To do
otherwise would ultimately render Article IV of the 1968
National Agreement meaningless."
- 20 -
,SOr4
JOWg
Case
a i
AWARD 34 - SBA NO. 1016: -
"We regard any improper siphoning off of work from
a collective bargaining agreement as an extremely serious
contract violation, one that can deprive the agreement of
t.
much of its meaning and undermine its provisions. In
order to preserve the integrity of the agreement and
enforce its provisions, the present claim will be
sustained in its entirety. Contrary to Carrier's
contentions, we do not find that the absence of a penalty
provision or the fact that claimants were employed full
time on the five dates in question deprives the Board of
jurisdiction to award damages in this situation."
AWARD 41 - SBA NO. 1016:
"Beyond this the Board has considered and finds
unpersuasive the Carrier's argument that notwithstanding
the Board finding of an Agreement violation by the
Carrier, the Claimants should not be awarded compensation
for the work performed by Gang TK-134, because the
Claimants were on duty and under pay during the period
that the Gang was used at work locations on the Philadelphia Seniority District.
Prior authorities on this facet of the case have
reached conflicting results. A number of authorities
cited by the Carrier hold that notwithstanding a contract
violation, compensation is allowable only where Claimants
show a monetary loss from their regular work assignments
in connection with the violation. Second Division Award
5890 and Third Division Award 18305. Contra authorities
have ruled that full employment does not negate a
compensatory award in situations where there is valid
need to preserve the integrity of the Agreement.
Important seniority rights are in question in this
case, because an Employee whose name is on a seniority
roster in an Agreement designated seniority district,
owns a vested right to perform work in that seniority
district that accrues to his standing and status on the
district seniority roster. The Seniority District
boundaries established by the parties' Agreement to
protect and enforce that right, have been improperly
crossed by the Carrier action, resulting in the Claimants
loss of work opportunities, and hence the principle that
compensation is warranted in order to preserve and
protect the integrity of the Agreement, is applicable to
this dispute. For similar rulings between these same
parties see Award No. 34 of Special Board of Adjustment
- 21 -
< 5~3A ~oNB
.. ,.
GaSe
a~
"No. 1016 (07-28-89) and Award No. 7 of Public Law Board
No. 3781 (02-12-86).'1 (Underscoring in original)
Although he does not say so in so many words, it appears that
the Referee has accepted and grounded his opinion upon the
Carrier's assertion that the Claimants were "fully employed". The
fact that the Claimants may have been working on the claim dates is
irrelevant under both the "damages" and "penalty" principles
espoused in the above-quoted awards. It is axiomatic that the
employment status of the Claimants is meaningless under the penalty
awards because they allow compensation to protect the sanctity of
the Agreement irrespective of monetary losses by individual
Claimants. The fact that the Claimants may have been working on
the claim dates is also irrelevant under the damages awards because
they are founded on a loss of work opportunity. The forty hour
work week provided for in the National Agreements establishes a
minimum of forty hours per week as long as positions exist. The
fact that Claimants may have received that minimum payment during
a claim period does not negate the fact that they lost the
opportunity to perform the work in dispute during daily or weekend
overtime or by having an extended work season for seasonal
employes. The fact is, that the collective bargaining agreement
specifically contemplates such work as is evidenced by the overtime
rules, call rules, and provisions governing work on holidays or
during vacation periods. In recognition of these opportunities for
`extended hours or additional days of work, numerous awards have
- 22 -
.S Q A
- C a.se
a
r
held that the so-called "full employment" of claimants is no bar to
the awarding of monetary damages:
e.
AWARD 13349: -(Thirdl
"However, the Carrier contends the Claimants have
proven no damages. It is firmer established that one
iniured by breach of an employment contract is limited to
the amount he would have earned under the contract less
such sums as he in fact earned. Brotherhood of Railway
Trainmen vs. Denver & Rio Grande Railroad Company (10
circuit C.A. 7651 & 7632 related specifically_ to a
dispute between a railroad and the members of a union.
This case is bindina upon this body. As stated the
evidence shows that the Carrier has failed to employ the
members of the Brotherhood as agreed. But the evidence
also establishes that the Claimants were employed at
another point on the Carrier's lines on the dates the
disputed work was performed. However, the evidence
indicates the employes and at least some of the equipment
were available at other times and further that the work
could have been done at other times.
The burden is upon the employe to show what his loss
has been. But upon showing that he has sustained a loss
of certain work and what that work was he has overcome
this burden. If the Carrier wishes to show in mitigation
that the employe received other income, the burden of
proof is upon the Carrier. Further, in a case such as
this where the employe could have done the work at more
than one time the Carrier must show that the employee was
employed at all times when he could reasonably have done
the work."
AWARD 14004: (Third)
"We do not distinguish between a contracting out
case and one in which work reserved to a class or craft
is performed by other employes stranger to the agreement.
The fact that Claimant was elsewhere working at the
time of the violation is not proof that he could not have
performed the crane work. In the instant case, therefore, Carrier having failed to adduce any evidence that
the work involved could not have been performed by
Claimant, has failed in its burden to grove an affirmative defense to overcome Petitioner's prima facie case.
In the posture of the record we are not confronted with
- 23 -
> S8A loqg
.. Case
al
"the legal distinction between 'penalties' and 'damages.'
See Award No. 11937.
We find it unnecessary to decide the number of hours
the crane was operated on the project. The make whole
theory will be satisfied by Carrier paying to Claimant
T
his pro rata rate for the hours the crane was operated on
the project as recorded in Carrier's records kept in the
ordinary course of business. We will sustain paragraph
2 of the ,Claim to the extent of the foregoing prescrip
tion."
AWARD 14982: (Thirds
"In resolving Claim No. 2 herein, we will follow
Award No. 14004 (Dorsey). In this award, the Board held
that there was no distinction between a contracting out
case and one in which work reserved to a class or craft
is performed by other employes stranger to the Agreement.
Also, in Award 14004, we stated:
'The fact that Claimant was elsewhere
working at the time of the violation is not
proof that he could not have performed the
crane work. In the instant case, therefore,
Carrier having failed to adduce any evidence
that the work involved could not have been
performed by Claimant, has failed in its
burden to Prove an affirmative defense to
overcome Petitioner's prima facie case. In
the posture of the record we are not confront
ed with the legal distinction between "penal
ties" and "damages." See Award No. 11937."'
AWARD 19268: (Third)_
"This Board has held before, and it is basic in
order to maintain the Scope of any collective agreement,
that work which belongs to those under an agreement
cannot be given away to others not covered by the
agreement except under circumstances that are so unusual
as to fall within recognized exceptions to the general
rule.
Even if Carrier had made a reasonable effort to
maintain a sufficient force of signalmen, it would be
obligated to show that the work which had been contracted
out could not have been performed by the Claimants on
rest days, by way of overtime, or by rearrangement of
their work schedule. The Board finds that Carrier has
not met its burden of proving that it could not have
- 24 -
58A lf~i-.(8
Case y
"worked existing signal employes on weekends or extra
hours during the week to perform the work."
AWARD
19324: Third
"On June 13, 1969, Carrier assigned B & B forces to
make temporary repairs to a steel slat rowing (sic) door
at Shop 18, Oneonta, New York, that had been damaged by
a switch engine earlier that day. On June 24, 1969, a
Plumber Foreman and three Plumbers were assigned to make
permanent repairs to the door. Claimants are all members
of B & B Force. Claimants were available and qualified
to have performed this work. Award 4845 (Carter) confirms Claimant's position in this case. On the basis of
said Award, Claimants were entitled to perform the involved work. Carrier, not having proved that this work
could not have been performed on overtime or by rescheduling work, is also liable for damages as claimed in
Part 2 of this claim. However,-Carrier is not liable for
the interest claimed in Part 3 of this claim."
AWARD
19846: (Third)
"With respect to Carrier's contention that Claimants
were 'fully employed' when the disputed work was per- -
formed and therefore suffered no monetary loss, the Board
would make two observations. First, this seems to be a
new defense, not raised on the property and not properly
before the Board. Second, even if a proper defense, to
support it Carrier would be required to show that Claim
ants could not have performed thecontested work during
overtime hours or on weekends and this it has failed to
do."
AWARD
19924: (Third)
"Carrier argues that Claimant has suffered no
monetary loss and no rule of the Agreement requires or
provides for a penalty payment. We have examined with
care the cases cited by both parties on the subject of
punitive damages and recognize the divergent philosophies
expressed in those Awards. In the case before us Carrier
has offered no proof that the work in question could not
have been performed on overtime ( in fact the work was
performed partially on one of Claimant's rest days) or
that it could not have been performed during regularly
scheduled hours of work. We agree with those cases which
hold that Claimant lost his rightful opportunity to
perform the work and is entitled to- a monetary claim.
See Awards 12671, 17059, 18365, 16430, 19441, and 19840."
- 25 -
..
. 59A toqg
. , . . G' a
.58 02(
AWARD 27485: (Third),
"4. Innumerable Awards have held that -- absent
emergency or total unavailability of qualified employees
-- where there is a contractual violation, a monetary
remedy is appropriate. If, in fact, the Claimants should
t,
have been assigned the work in question, the work they
performed during the period in question could have
otherwise been accomplished as directed by the Carrier."
"*** The Board also denies the Carrier's view that
since the Claimant was fully employed and suffered no
monetary loss, he is not entitled to 'enrichment.' There
is no evidence that these four jobs could not have been
assigned the Claimant at some point. They were not shown
to be required on the dates in question. Given the
undisputed record of the Claimant's hours worked in the
previous seventeen (17) months, the Claim is sustained in
these instant circumstances."
These awards clearly establish that so-called "full employment" is not a bar to finding and awarding monetary damages.
Moreover, these same awards also establish that when work is
improperly assigned to an outside contractor or even other employes
who have no contract right to the work, this establishes a prima
facie case for -the Organization and the burden shifts to the
Carrier to prove that the Claimants would have been unable to ..
perform the work through the use of overtime, rescheduling, etc.
In the instant case, no such showing was made or even attempted by
the N&W because no such showing was possible. The inescapable fact
is that the Claimants had cleaned the hopper cars at Princeton for
at least six years and there is no reason they could not have
cleaned them on the claim dates. Hence, the Claimants suffered a
loss of work opportunity for which they were entitled to receive
associated wage loss.
- 26 -
say
~a Ns
r
. . . c~.s~ a~
It is transparently clear that neither judicial or arbitral
precedent prohibited the sustaining of the monetary award in this
claim. In fact, precisely the opposite is true. There is ample
c.
precedent in both forums to mandate a sustaining award. The
Referee's finding that he somehow lacked authority or jurisdiction
to sustain the monetary claim is without credible support. The
simple fact is that this was not a matter of jurisdiction or
authority as the Referee attempts to assert. Instead, the Referee
was dispensing his own brand of industrial justice based on his
subjective notion of equity. The problem is that there is no
justice or equity in rewarding a Carrier who, by the Referee's own
finding, not only engaged in "repeated violation of the agreement"
but also, "repeatedly thumbed their nose at the agreement" and
thereby caused their employes to suffer clear and unmistakable
monetary damage.
For all of these reasons, I emphatically dissent with respect
to the damages finding in this award.
R. Lau
Employe Member
- 27 -
- 589 ~o~f8
. . . < , Ca.Se cZ 1
CARRIER MEMBER'S DISSENT
TO
AWARD 21
SPECIAL BOARD OF ADJUSTMENT 1048
Without wishing to unnecessarily expand the already
lengthy written record in this case, certain points in this Award
are incorrect and need to be addressed. For that reason, this
dissent is required.
First, on page 11, the Award stated that Carrier raised
a "new argument" [that the December 11, 1981 "Berge/Hopkins letter"
was not applicable on NW] for the first time at the executive
session; this is factually incorrect. During the protracted
handling of this case on the property, the Organization never
relied on or referred to the "Berge/Hopkins letter." However, this
issue was raised by the organization for the first time in its
submission (which was received by Carrier shortly before the
Referee Hearing). During that Referee Hearing, Carrier not only
argued that the "Berge/Hopkins letter" was not applicable on this
property, but also objected that its introduction into the record
was a new position not handled on the property and should not be
considered. - As a result, it was the Organization, and not the
Carrier, that belatedly raised a position that was not handled on
the property, and this position (that the "Berge/Hopkins letter"
supported the claim) should not have been considered by the Referee
in rendering this Award.
Furthermore, the Board's determination that the
"Berge/Hopkins letter" is applicable on this property is in error.
The rationale contained on pages 10 and 11 of the Award ignores the
fact that Rule 59(p) of the July 1, 1986 schedule agreement on this
property makes it clear that it is "sole agreement" between the
parties. In light of that language, agreements that were not
contained therein which predated that scheduled agreement (such as
the "Berge/Hopkins letter") are not applicable on this property.
This Award failed to properly apply Rule 59(p), and in fact did not
even mention it. Therefore, the Board's finding that the
"Berge/Hopkins letter" is applicable on this property is improper
and incorrect and is not considered as a precedent on this point.
For the foregoing reasons, we dissent to the Board's
findings on the points discussed above.
L. F. Miller
Carrier Me er