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Hansen v. Qwest Communications

May 6, 2009

RICHARD HANSEN, PLAINTIFF/APPELLANT,
v.
QWEST COMMUNICATIONS, CORPORATION; QWEST BUSINESS RESOURCES, INC., DEFENDANTS, COMMUNICATION WORKERS OF AMERICA, AFL/CIO, DEFENDANT/APPELLEE.



Appeal from the United States District Court for the District of Nebraska.

The opinion of the court was delivered by: Riley, Circuit Judge

Submitted: December 11, 2008

Before WOLLMAN, BYE, and RILEY, Circuit Judges.

Richard Hansen (Hansen) filed an action in federal district court alleging his union, Communication Workers of America, AFL/CIO (Union), breached its duty of fair representation by failing to provide Hansen with full back pay damages after an arbitrator determined there was no just cause for Hansen's termination. The district court*fn1 determined the Union did not breach its duty of fair representation and granted the Union's motion for summary judgment. Hansen appeals, and we affirm, substantially for the reasons given in the district court's opinion.

I. BACKGROUND

This case involves the interplay between two collective bargaining agreements. Hansen was employed by Qwest Business Resources, Inc. (Company) and was terminated in January of 2003 for allegedly falsifying Company documents. At the time of his discharge, Hansen was a member of a bargaining unit covered by a collective bargaining agreement (BRI Agreement), which was in effect from August of 1998 until August of 2003. The BRI Agreement contained a three step grievance procedure which provided final, binding arbitration as the final step. Under the BRI Agreement, a favorable arbitration result could entitle the employee to full back pay damages.

The other bargaining agreement at issue is the Qwest Corporation and Union Agreement (Qwest Agreement), which went into effect in August of 2003, after Hansen was discharged. As part of its grievance process, the Qwest Agreement provided an interim step of advisory, non-binding arbitration before a single arbitrator, also known as alternative dispute resolution (ADR). A favorable advisory ADR result under the Qwest Agreement would entitle an employee to a maximum of 18 months back pay. The Qwest Agreement provided either party the opportunity to submit the grievance to final and binding arbitration if dissatisfied with the result of the advisory ADR. Unlike the Qwest Agreement, the BRI Agreement in effect at the time of Hansen's termination did not contain an advisory ADR mechanism.

The Union grieved Hansen's discharge. The Company rejected the grievance at the first two steps, and the Union moved the grievance to the third step of the grievance procedure under the BRI Agreement. Between the second and third steps of the grievance procedure, the Company and the Union engaged in settlement negotiations to resolve the grievance, with the Company offering to settle for $5,000 with no reinstatement. Hansen rejected the Company's offer and, more than 19 months after his discharge, offered to settle for $50,000 (one year's wages) and no reinstatement. The Company rejected this offer.

After settlement negotiations failed, Union representative Mary Kay Pence (Pence) informed Hansen, based on her assessment of the merits of Hansen's grievance, Pence did not believe the Union could prevail at arbitration. Hansen appealed Pence's determination through the Union's internal appeal process. Leroy Christensen (Christensen), an administrative assistant to Union Vice President John Thompson, reviewed the appeal and determined, while Hansen's grievance would be difficult to win, it should be pursued.

Christensen approached Company representative Hugh Doherty (Doherty) about handling Hansen's grievance through the advisory ADR process found in the Qwest Agreement, with the understanding that if either party did not accept the advisory ADR result, the parties could submit the matter to binding arbitration under the BRI Agreement. Christensen stated in an affidavit that he decided to pursue advisory ADR in Hansen's case for a number of reasons, including: (1) binding arbitration can take many months, whereas the advisory ADR process was much more expeditious and would allow Hansen to be reinstated much sooner; (2) if Hansen was dissatisfied with the result of the advisory ADR, he retained the option of pursuing full arbitration under the BRI Agreement; (3) the advisory ADR's remedy of reinstatement and 18 months of back pay was worth more than Hansen's previous offer to settle for one year of back pay and no reinstatement; and (4) based on Christensen's experience with similar grievances, Christensen did not believe the Company would settle for the amount Hansen was seeking.

On behalf of the Company, Doherty agreed to handle Hansen's grievance through the Qwest Agreement's advisory ADR process, and thereafter the grievance could be submitted to binding arbitration under the BRI Agreement. Christensen and Doherty testified they also agreed if Hansen prevailed at advisory ADR and both parties accepted the result, Hansen's back pay would be limited to 18 months. When Christensen called Hansen to tell him the Union had granted his appeal and the grievance would be proceeding to ADR, Christensen neglected to inform Hansen of the 18-month back pay cap.

In January or February of 2005, Jay Boyle (Boyle) was hired to replace Pence as the Union representative for Nebraska, and Boyle was assigned to Hansen's grievance. Boyle was not informed Hansen's back pay remedy was limited to 18 months if Hansen prevailed at ADR. Boyle believed Hansen would be entitled to full back pay if he prevailed at ADR. Boylecontacted Hansen in May of 2005 and explained both sides would have the opportunity to present their case to an arbitrator, who would decide whether the Company had just cause to terminate Hansen. Boyle further explained, if both sides accepted the arbitrator's decision, it would become final, but if either party rejected it, the party could demand full arbitration.

The only issue at the ADR hearing was whether the Company had just cause to discharge Hansen. Hansen achieved a favorable result at the ADR hearing-the arbitrator found the Company did not have just cause to discharge Hansen. On October 12, 2005, the Company informed the Union it had decided to accept the ADR decision, and Hansen was reinstated on October 31, 2005. On November 2, 2005, Boyle learned Hansen's back pay would be capped at 18 months. Boyle informed Hansen. Boyle thought the reason for the cap was because all employees who prevailed at ADR after the Qwest Agreement took effect were subject to such a cap. Boyle did not realize until December of 2005 that the reason for the back pay cap was because Christensen and Doherty had agreed to submit Hansen's grievance to the Qwest Agreement's ADR procedure, including the 18-month back pay cap.

On January 26, 2006, the Company offered Hansen 18 months of back pay, which Hansen rejected. The Company agreed the Union could pursue the full back pay remedy under the BRI Agreement. Boyle wrote Hansen a letter informing Hansen he had the option either to accept the 18 months of back pay and reinstatement, or proceed to final and binding arbitration. Boyle's letter warned Hansen, "the [binding] arbitration hearing offers substantial risks. Though the arbitrator could agree with the finding of the advisory arbitrator, there is an equal possibility that the arbitrator could deny the grievance resulting in you losing your job and any back pay you have already gained through this initial ...


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