July 23, 2019

Tenth Circuit: Arbitrator’s Decision is Due Utmost Judicial Deference and Must Be Upheld Unless Without Any Textual Basis

On March 6, 2012, the Tenth Circuit Court of Appeals issued its opinion in San Juan Coal Company v. International Union of Operating Engineers.

San Juan Oil Company (San Juan) operates a coal mine. Workers are unionized, and the terms of their employment are set forth in a collective bargaining agreement (CBA). The CBA includes a “holdover pay” provision. In an effort to reduce costs, San Juan entered into negotiations with the union to establish new worker schedules, which resulted in a Memorandum of Agreement (MOA). A month later, the Union filed a grievance, arguing workers were wrongfully denied holdover pay under the CBA.

San Juan and the union entered into a binding arbitration to determine whether certain union members were entitled to holdover pay. The arbitrator concluded the union members were entitled to extra pay. The district court vacated the arbitrator’s award.

Judicial review of an arbitral award “is among the narrowest known to law.” Champion Boxed Beef Co. v. Local No. 7 United Food & Commercial Workers Int’l Union, 24 F.3d 86, 87 (10th Cir. 1994) (quotation omitted), and is entitled to the utmost judicial deference, even if a trial court might offer a more cogent reading of the argument. In reviewing the CBA and the MOA, the 10th Circuit reversed, upholding the arbitrator’s determination, because the arbitrator’s decision had some foundation in the text of the CBA and MOA.

Reversed and remanded with instructions to enter an order of enforcement.

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