FEDERAL MEDIATION AND CONCILIATION SERVICE

In the Matter of the Arbitration between FMCS No. 22-08135

Grievance No. 6-21
INTERNATIONAL BROTHERHOOD OF
BOILERMAKERS, IRON SHIP BUILDERS,
BLACKSMITHS, FORGERS AND HELPERS,
LOCAL LODGE DNCL, SANDUSKY, OHIO,
Union,

and

HANSON AGGREGATES MIDWEST, LLC.,

Company.
_____________________________________________/

OPINION OF THE ARBITRATOR

November 21, 2022

Upon Stipulations by the Parties filed October 4, 2022

And Briefs filed November 14, 2022

For the Union: For the Company:

Jeff A. Campbell Robert E. Bernat
Int’l Brotherhood of Boilermakers Hanson Aggregates Midwest, LLC
4353 Scotland Drive PO Box 234
Owensboro, KY 42303 Middlebranch, OH 44652
 INTRODUCTION

Hanson Aggregates owns and operates a rock quarry in Sandusky, Ohio, in

which all maintenance and production hourly employees are represented by the

National Cement Lodge (DNCL) of the International Brotherhood of Boilermakers,

Iron Ship Builders, Blacksmiths, Forgers and Helpers.

In summary, the employees mine the rock and crush to various sizes to be sent

to customers.

ISSUE

Did the Company violate Article 1, Section 1 of the Collective Bargaining

Agreement (CBA) by having Company employees from a different location who are

parties to a different CBA to perform bargaining unit work at the Sandusky facility?

RELEVANT CONTRACT PROVISIONS

ARTICLE I - UNION RECOGNITION

Section 1. The Company recognizes the Union as the exclusive bargaining agency
for all its employees at the Wagner Quarry, Perkins Township, except salaried office
employees, professional employees, guards and supervisors as defined in the
National Labor Relations Act.

ARTICLE XI – MANAGEMENT RIGHTS

Section 1. The management of the Company and the direction of its working forces,
including the right to establish new jobs, abolish or change existing jobs, increase or
decrease the number of jobs, determine the number and locations of its operating
facilities, to close any operating facility. To change material, processes, products,
equipment, operations and to transfer equipment shall be vested exclusively in the
Company. The Company shall have the right to subcontract work in a manner not
inconsistent with the terms of this Agreement. (Italics by arbitrator.)
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 ARTICLE XXI – GENERAL

Section 7. All production and maintenance work customarily performed by the

Company in its own plant and with its own employees shall continue to be performed
by the Company by and with its own employees.

Section 8. The intent of Section 7 above relative to "contracting out" is the Company
will not contract for production or maintenance work customarily performed by its
employees so long as the Company has the facilities and equipment and available
personnel to properly perform the work required. The Company will not subcontract
work if it causes a layoff for qualified bargaining unit employees or if the Company
has employees on layoff status qualified to perform the work. If the Company has
qualified employees, the qualified employees will be recalled to perform the work.
The previous sentence does not apply to employees who are on temporary voluntary
layoff. (Italics by arbitrator.)

STIPULATION OF FACTS

(1) Due to an influx of work the Company required extra manpower at the
Sandusky facility during the period of 10/25/21 thru 11/25/21.

(2) Four (4) employees performed bargaining unit work at the Sandusky facility
from 10/25/21 thru 11/25/21.

(3) During their time at the Sandusky facility, the four (4) employees received
compensation and benefits described in a CBA between Hanson Aggregates and the
International Union of Operating Engineers Local Union 18 and 18C.

(4) The four (4) employees were under the supervision of Sandusky management.

(5) No employees from the Sandusky facility were laid off from 10/25/21 thru
11/25/21.

EXHIBITS

JOINT EXHIBIT 1: CBA

JOINT EXHIBIT 2: GRIEVANCE FORM

DATE FILED 29 Oct 21

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 The Company is in violation of Article 1, Section 1 of the CBA by having
employees from another labor union perform bargaining unit work at Wagner
Quarry.

The Union requests the above action cease immediately and not be repeated
in the future.

JOINT EXHIBIT 3: COMPANY GRIEVANCE RESPONSE

Grievance 6-21, the Union alleges that the Company violated Article 1,
section 1 of the CBA when they assigned additional work to Company
employees from another location. The Company finds no violation of Article
1, section 1 and that they are within their rights to utilize contractors under
Article 21 section 8, however they agree to discuss with the Union possible
options should this occur in the future.

The foregoing has been taken essentially verbatim from the joint stipulations

and exhibits that the parties submitted to the arbitrator on October 4, 2022.

UNION POSITION

Article 1, Section 1 of the CBA (J1) clearly states the Company recognizes
the Union as the exclusive bargaining agency for all its employees at the Wagner
Quarry, Perkins Township, except salaried office employees, professional
employees, guards and supervisors as defined in the National Labor Relations Act.
Subsequently, all hourly employees’ terms and conditions of employment are
subject to the Boilermaker Union’s representation. The four employees from the
Operating Engineers Union were not working under the facilities CBA (J1), nor were
they subscribing to the terms and conditions set forth, and were not being represented
by the Boilermakers’ Union. These four employees for the one-month period,
worked under the recognition of another CBA between the Operating Engineers and
the Company. The four employees performed normal bargaining unit work on day
shift under the classifications described in the Boilermakers’ CBA (J1). However,
their compensation and benefits were quite different than that of the Wagner Quarry
employees. They were also directed by the Company in the same fashion as the
Wagner Quarry employees. There has been a long practice at the Wagner facility
that the bargaining unit employees within the classifications will be awarded shift
preference based on seniority. Despite the Union’s request for the employees they
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represent to have an opportunity to work day shift during the one month period, the
Company honored the four employees with day shift. In this instance its clear the
Company did not recognize the shift preference practice under the facilities’ CBA
(J1). Furthermore, Operating Engineers were allowed recognition by the Company
and subscribed to a different set of terms and conditions of employment. All the
aforementioned is in direct violation of the Union’s exclusivity as described in
Article 1, Section 1 of the CBA (J1).

***

The Company’s grievance #6-21 (J2) response dated November 30, 2021 (J3),
is flawed and without merit. The Company assertion that Article XXI, Section 8 of
the CBA (J1) gives them the right to use contractors in certain situations is correct
without dispute. However, in this instance the four employees in no way can be
considered contractors for the following reasons:

1. Employees were employed full-time hourly employees by the Company at

another facility.
2. Employees were members of a different labor Union that is party to a
different CBA with the Company.
3. Employees received hourly compensation and benefits from the Company.
4. Employees were working in the same classifications and adhering to a set
schedule identical to the bargaining unit employees.
5. Employees utilized Company tools and equipment.
6. Employees were under direct control by the Company.

The aforementioned criteria nullfies the four employees from identifying as

contractors. Indeed, the Company’s grievance response and position cannot be given
any credence.

COMPANY POSITION

The Company received an order from a large customer on October 23, 2021,
the customer needed our aggregates product (rock) and the job required an
immediate start date. We accepted the job and began working to meet the customer
needs. Very early on it was evident that the Wagner Quarry, (Wagner workers are
members of Boilermakers Local D337), was the right location to meet the customer
needs however, we would need to ramp up production in order the get the job done.
Hanson was slowing down production at our Bloomfield Quarry, (Bloomfield
workers are members of Operating Engineers Local 18) which performs the same
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work as Wagner about 20 miles away and was going into seasonal layoffs.
Management decided to ask the Bloomfield employees if they would like to
volunteer to work at the Wagner location to help out on the emergency project and
four (4) employees volunteered to work at the Wagner location, all four employees
worked the day shift at the Bloomfield Quarry.
Management from the Wagner Quarry informed the Union of our decision to
move the Bloomfield employees to the Wagner Quarry to supplement the workforce.
The Unions International Representative … called the Company Labor Manager …
to discuss the subcontracting issue. During those conversations the Union requested
that if the Bloomfield worker came to Wagner that they would require Bloomfield
employees to work the Afternoon or Night shift and offer Wagner employees to
move to the dayshift exclusively. The Company and Union could not agree to a
resolution and the Union filed the grievance before the Arbitrator today. (Italics by
arbitrator.)
The Company did not violate the collective bargaining agreement Article1,
section 1. The Company utilized employees from another location to supplement the
workforce in order to meet customer needs, this is no different from utilizing a
subcontractor to full fill the work obligation. (Italics by arbitrator.)
The Company retains the right to subcontract work under Article 11, Section
1, The management of the Company and the direction of its working forces,
including the right to establish new jobs, abolish or change existing jobs, increase or
decrease the number of jobs, determine the number and locations of its operating
facilities, to close any operating facility. To change material, processes, products,
equipment, operations and to transfer equipment shall be vested exclusively in the
Company. The Company shall have the right to subcontract work in a manner not
inconsistent with the terms of this Agreement. (Italics by arbitrator.)
Article 21 Section 7 and 8 of the cba states Section 7. All production and
maintenance work customarily performed by the Company in its own plant and with
its own employees shall continue to be performed by the Company by and with its
own employees.
Article 21 Section 8 states, “The intent of Section 7 above relative to
"contracting out" is the Company will not contract for production or maintenance
work customarily performed by its employees so long as the Company has the
facilities and equipment and available personnel to properly perform the work
required. The Company will not subcontract work if it causes a layoff for qualified
bargaining unit employees or if the Company has employees on layoff status
qualified to perform the work. If the Company has qualified employees, the qualified
employees will be recalled to perform the work. The previous sentence does not
apply to employees who are on temporary voluntary layoff.” (Italics by arbitrator.)

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 The Company utilized company employees and in accordance with Section 7,
the subcontracted work did not cause the layoff of any employees. (Italics by
arbitrator.)
The Company has on many occasions utilized outside contractors to perform
bargaining unit work at the Wagner location and as long as section 8 of the cba is
followed the union has not complained. In fact, some of the contractors are non-
union and the union has not complained. In this case the company utilized their
unionized co-workers from Bloomfield that were going to be laid -off but instead we
offered work at another location.
In the past the Company has had the Driller from the Wagner Quarry work at
the Bloomfield Quarry to supplement the workforce in the same way and there was
never a complaint from the Operating Engineers Local 18 that represents the
Bloomfield workers.
This was certainly not a violation of the contract and was the correct
operational decision.

***

There is no contractual restriction and management acted in good faith in

assigning the work to the Bloomfield employees, arbitrators have emphasized
justifying circumstances in upholding management’s decision to subcontract work,
” Included among such considerations or circumstances are the following fact
situations: (Italics by arbitrator.)

[The Company then cites an earlier edition of Elkouri & Elkouri, HOW
ARBITRATION WORKS. In the Eighth Edition (2016), which the arbitrator uses,
the comparable citation would be to pages 13-126—13-133.]

The excerpts from the parties’ briefs were taken verbatim, except that the

arbitrator omitted some emphasis and added some punctuation.

DISCUSSION

This case presents two difficulties for the arbitrator:

(A) A hearing was scheduled in this case for July 28, 2022. However, at a

pretrial conference on July 21, 2022, the parties agreed to submit the case on

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stipulations and briefs. The parties submitted their stipulations on October 4, 2022,

consisting, inter alia, of five (5) meager facts. In their briefs of November 14, 2022,

the parties made statements and allegations far outside the pale of the information

included in their stipulations of October 4, 2022. While the arbitrator does not

question the veracity of their statements or the legitimacy of their allegations, he

feels bound by their stipulations of October 4, 2022, and limits his Opinion

accordingly. Had the parties wanted a broader range of facts and issues considered,

they could have had a hearing as originally planned.

(B) Different terms, “subcontracting” and “contracting out”, are used in

convoluted and confusing ways. In Fibreboard Paper Products Corp v Labor Board,

379 US 203, 215 n 8 (1964), the Supreme Court noted the lack of precision:

As the Solicitor General points out, the terms "contracting out" and
"subcontracting" have no precise meaning. They are used to describe a variety
of business arrangements altogether different from that involved in this case.
For a discussion of the various types of "contracting out" or "subcontracting"
arrangements, see Brief for Respondent, pp. 13-17; Brief for Electronic
Industries Association as amicus curiae, pp. 5-10.

BURDEN OF PROOF

The parties agree that the Union has the burden of proof in this case. However,

once the Union has made out a prima facie case, the burden of going forward with

the evidence shifts to the Company. HOW ARBITRATION WORKS (Bloomberg

BNA 8th ed 2016) @ 8-105; Hill & Sinicropi, EVIDENCE IN ARBITRATION

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(BNA 2nd ed 1987) @ 41-43. In the arbitrator’s opinion, the Union has made out a

prima facie case, as explained infra.

(1) The opening paragraph of the parties’ stipulations states that all

maintenance and production hourly employees at the Sandusky quarry are

represented by the Union.

(2) Article IX of the CBA requires:

Section 1. The Company agrees that all employees of the Company who are
members of the Union shall remain members in good standing in the Union
as a condition of their continued employment, and that all employees of the
Company who are not now members of the Union shall within thirty-one (31)
calendar days from the date of this agreement become and remain members
in good standing of the Union as a condition of their continued employment.

Section 2. All employees hired after the date of the execution of this
agreement within shall thirty-one (31) calendar days after the date of their
hiring become and remain members in good standing of the Union as a
condition of their employment.

Although the parties did not explicitly include Article IX in their stipulations,

they did submit the entire CBA as Joint Exhibit 1. As a result, the arbitrator may

refer to any and all relevant provisions of the CBA. Greater Dayton Regional Transit

Authority v Amalgamated Transit Union, AFL CIO, Local 1385, 129 NE 3d 1076,

1084 (Ohio Ct App, 2nd Dist, 2019) (“Nowhere does the CBA limit the arbitrator to

considering only interpretations for which a party to the dispute affirmatively

advocates”).

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 This particular Article IX appears to require all employees working at the

quarry to be members of the Union. That would include the four (4) employees

identified in the Stipulation of Facts, who worked the thirty-one (31) calendar days

from 10/25/21 through 11/25/21, but were members of the International Union of

Operating Engineers.

(3) The plain language of CBA Article I, Section 1, Article IX, and Article XXI,

Section 7, applied to the Stipulation of Facts make out a prima facie case for the

Union. The burden, therefore, shifts to the Company to produce evidence in defense

of its action.

COMPANY’S DEFENSE

The principal points made in the Argument portion of the Company brief are

the following:

(i) The Unions International Representative … called the Company Labor

Manager … to discuss the subcontracting issue. (Italics by arbitrator.)

Included by the arbitrator because of reference to the subcontracting

issue.

(ii) The Company utilized employees from another location to supplement

the workforce in order to meet customer needs, this is no different from
utilizing a subcontractor to full fill the work obligation. (Italics by
arbitrator.)

(iii) The Company retains the right to subcontract work under Article 11,
Section 1 … . The Company shall have the right to subcontract work
in a manner not inconsistent with the terms of this Agreement. (Italics
by arbitrator.)

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 (iv) Article 21 Section 8 states, “The intent of Section 7 above relative to
"contracting out" is the Company will not contract for production or
maintenance work customarily performed by its employees so long as
the Company has the facilities and equipment and available personnel
to properly perform the work required. The Company will not
subcontract work if it causes a layoff for qualified bargaining unit
employees or if the Company has employees on layoff status qualified
to perform the work. (Italics by arbitrator.)

(v) There is no contractual restriction and management acted in good faith

in assigning the work to the Bloomfield employees, arbitrators have
emphasized justifying circumstances in upholding management’s
decision to subcontract work … . (Italics by arbitrator.)

Clearly there is an issue about subcontracting. As noted in Fibreboard Paper

Products, supra, “subcontracting” may have different meanings. The term is not

defined in the CBA, and the parties have not endeavored to define it in their briefs.

Therefore, the arbitrator must ascertain its meaning. In doing so, he follows Ohio

law:

[T]he court notes that common words appearing in a written instrument are to
be given their plain and ordinary meaning unless manifest absurdity results or
unless some other meaning is clearly intended from the face or overall
contents of the instrument. Alexander v Buckeye Pipe Line Co, 53 Ohio St 2d
241, 245-246 (1978) (Citations omitted).

[W]e will look to the plain and ordinary meaning of the language used in the
contract unless another meaning is clearly apparent from the contents of the
agreement. When the language of a written contract is clear, a court may look
no further than the writing itself to find the intent of the parties. "As a matter
of law, a contract is unambiguous if it can be given a definite legal
meaning." Westfield Ins. Co. v. Galatis, 100 Ohio St.3d 216, 2003-Ohio-5849,
797 N.E.2d 1256, ¶ 11. Sunoco, Inc v Toledo Edison Co, 129 Ohio St 3d 397,
404; 2011-Ohio-2720; 953 NE 2d 285 (2011) (Also citing Alexander).

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 In the absence of any guidance from the CBA or the parties’ briefs, the first

step is to consult dictionaries:

From https://www.merriam-webster.com/dictionary/subcontract:

subcontract (noun): a contract between a party to an original contract and a

third party, especially : one to provide all or a specified part of the work or
materials required in the original contract.

subcontract (transitive verb): to engage a third party to perform under a

subcontract all or part of (work included in an original contract) — sometimes
used with out.

From https://dictionary.cambridge.org/us/dictionary/english/subcontract:

subcontract (verb): to pay an outside person or organization to do work that

might normally be done within an organization.

subcontract (noun): an agreement for an outside person or organization to do

work that might normally be done within an organization.

From Black’s Law Dictionary (11th ed 2019):

subcontract (18c): A secondary contract made by a party to a primary contract

for carrying out the primary contract, or a part of it.

From https://www.law.cornell.edu/wex/subcontractor:

A subcontractor is a person or entity that has been awarded by the general

contractor the performance of part of the work or services of an existing
contract entered between the general contractor and the (original) contracting
party. Furthermore, the subcontractor may award to another subcontractor part
of the work contracted with the general contractor. In this case, the
subcontractor would be subcontracting with another subcontractor.

***

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 Subcontractors are independent and do not have an employer-employee
relationship with either the general contractor or other subcontractors.
(Italics by arbitrator.)

Subcontracting is common in building contracts and large-scale projects. For

example, in construction, when a general contractor gets hired to build a
house, the general contractor may subcontract with one or several
subcontractors to perform different pieces of the construction. For instance,
one subcontractor may install the plumbing, and another may lay the floors in
the house, creating multiple independent subcontracting relationships.

For the Company to subcontract within the meaning of one of these

definitions, the Company, as general contractor, would have to have one or more

contracts to supply aggregate to one or more of its customers. It could be inferred

from the first Stipulation of Facts that this was the case from 10/25/21 through

11/25/21. To subcontract some of this work, there would have to be one or more

third-party subcontractors,1 the existence of which cannot be inferred from the

Stipulation of Facts. As stated in the explanation from Cornell Law, “Subcontractors

are independent and do not have an employer-employee relationship with either the

general contractor or other subcontractors.” Thus, the crucial element of an

independent subcontractor is lacking. All the Company did was to transfer four of

its employees from one of its quarries to another quarry; no third party was involved.

1
It is elementary that the Company cannot contract with itself. “At common law, a party is
generally unable to contract with itself, or to transfer property to itself.”
https://www.lexology.com/library/detail.aspx?g=23eacaef-6420-41d0-b7ff-e0fcb584694d#: ~:
text=At%20common%20law%2C%20a%20party,to%20transfer%20property%20to%20itself

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 A similar problem arises with “contracting out”, which appears only once in

the CBA, in Article XXI, Section 8:

The intent of Section 7 above relative to "contracting out" is the Company

will not contract for production or maintenance work customarily performed
by its employees so long as the Company has the facilities and equipment and
available personnel to properly perform the work required.

There simply was no newly signed contract, or other agreement with the Union, with

respect to the four transferred employees. Cf. Fibreboard Paper Products, supra

(contract with third party).

Although the Company brief is broader in scope than the stipulations,

nowhere does the Company assert that it did not have the “available [Boilermakers

Union] personnel to properly perform the work required.” Instead, the Company

explains:

Very early on it was evident that the Wagner Quarry, (Wagner workers are
members of Boilermakers Local D337), was the right location to meet the
customer needs however, we would need to ramp up production in order the
get the job done. Hanson was slowing down production at our Bloomfield
Quarry, (Bloomfield workers are members of Operating Engineers Local 18)
which performs the same work as Wagner about 20 miles away and was going
into seasonal layoffs. Management decided to ask the Bloomfield employees
if they would like to volunteer to work at the Wagner location to help out on
the emergency project and four (4) employees volunteered to work at the
Wagner location, all four employees worked the day shift at the Bloomfield
Quarry.

There is no assertion in either the Company’s grievance response or brief that

Boilermakers Union members could not have “ramped up” to perform the disputed

work. Moreover, emergencies are not addressed in the CBA, and—save for the
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Company’s assertion that there was an emergency—there is insufficient evidence to

support that claim. NW State Comm College v NW State Comm College Ed Ass’n,

79 NE 3d 1127, 1131; 2016-Ohio-8393 (Ohio Ct App, 3rd Dist, 2016) (no emergency

even though addressed in contract).

AWARD

The grievance is sustained as to future incidents. No monetary award was

requested, but see Fibreboard Paper Products, supra, re damages.

_________________________________
E. Frank Cornelius, PhD, JD, Arbitrator

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