Hines v. Anchor Motor Freight, Inc., 424 U.S. 554 (1976)

CERTIORARI TO THE UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

Syllabus

Petitioner employees were discharged by respondent employer for alleged dishonesty. Respondent union, claiming that petitioners were innocent, opposed the discharges and, pursuant to the collective bargaining contract, the matter was submitted to an arbitration committee, which upheld the discharges. The collective bargaining contract provided that a decision by the arbitration committee would be final and binding on all parties, including the employees affected. However, when subsequent information indicated that the charges of dishonesty might have been false, petitioners brought a wrongful discharge suit against the employer and union under § 301 of the Labor Management Relations Act, alleging that the falsity of the charges could have been discovered with a minimum of investigation, and that the union had made no effort to ascertain the truth, and thereby had violated its duty of fair representation by arbitrarily and in bad faith depriving petitioners of their employment and permitting their discharge without sufficient proof. The District Court granted summary judgment for respondents on the ground that the arbitration committee’s decision was final and binding absent a showing of bad faith, arbitrariness, or perfunctoriness on the union’s part. Concluding that there were sufficient facts from which to infer bad faith or arbitrary conduct on the union’s part, and that petitioners should have been afforded an opportunity to prove their charges, the Court of Appeals reversed the District Court to that extent, but affirmed the judgment in the employer’s favor on the ground that the finality provision of the collective bargaining contract had to be observed unless evidence showed misconduct by the employer or a conspiracy between it and the union.

Held: It was improper to dismiss petitioners’ suit against respondent employer, since, if petitioners prove an erroneous discharge and respondent union’s breach of duty of fair representation tainting the arbitration committee’s decision, they are entitled to an appropriate remedy against the employer as well as the union. Pp. 501-572.

(a) A union’s breach of duty relieves the employee of an express or implied requirement that disputes be settled through contractual procedures and, if it seriously undermines the integrity of the arbitral process, also removes the bar of the finality provision of the contract. Pp. 567-569.

(b) Respondent employer, if the charges of dishonesty were in error, played its part in precipitating the dispute, and though the employer may not have knowingly or negligently relied on false evidence in discharging petitioners, and may have prevailed before the arbitration committee after presenting its case by fair procedures, petitioners should not be foreclosed from their § 301 remedy otherwise available against the employer if the contractual processes have been seriously flawed by the union’s breach of its duty. Pp. 565-570.

(c) While the grievance processes cannot be expected to be error-free, enforcement of the finality provision where the arbitrator has erred is conditioned upon the union’s having satisfied its statutory duty fairly to represent the employees in connection with arbitration proceedings; otherwise, a wrongfully discharged employee would be left without a job and a fair opportunity to secure an adequate remedy. Pp. 570-571.

506 F.2d 1153, reversed in part.

WHITE, J., delivered the opinion of the Court, in which BRENNAN, STEWART, MARSHALL, BLACKMUN, and POWELL, JJ., joined. STEWART, J., filed a concurring opinion, post, p. 572. REHNQUIST, J., filed a dissenting opinion, in which BURGER, C.J., joined, post, p. 573. STEVENS, J., took no part in the consideration or decision of the case.