The Sixth Circuit Court of Appeals recently found that a grievance from a Kroger union was included within the scope of an arbitration clause in a collective agreement.
Kroger and the International Brotherhood of Teamsters, Local # 413, reached a collective agreement that contained a broad arbitration clause that covered employee grievances. The agreement defined “grievance” as “a dispute between the employer and the employee concerning the interpretation or application of any provision of the[e] Agreement and is limited to the express terms and provisions of th[e] Agreement.”
The agreement also contained provisions for the Kroger employee pension plan. Beginning in 2001, Kroger provided retirement benefits through the Kroger Consolidated Retirement Benefit Plan. In 2017, however, Kroger ended the consolidated benefit plan and replaced it with a spin-off plan for unionized employees. Kroger also provided other new retirement options – such as lump sum payments and a 401 (k) – to non-union employees.
A shop steward grieved the changes to pension benefits, but Kroger refused to arbitrate the grievance. Kroger asserted that the grievance fell outside the scope of the arbitration clause of the collective agreement. The union then brought an action under the Labor and Management Relations Act to demand arbitration. The district court recognized that the arbitration was justified.
Kroger appealed the district court’s judgment to the Sixth Circuit, which upheld.
The Sixth Circuit noted that there is a presumption of arbitration under the LMRA. She also explained that the arbitration clause in question was broad and that the presumption in favor of arbitration was therefore particularly justified in the present case. Nonetheless, the court concluded that the collective agreement was ambiguous as to whether the grievance was covered. Applying the presumption in favor of arbitration, the Sixth Circuit therefore analyzed whether the grievance was expressly excluded from the arbitration clause. The court considered that it was not because the “arbitration clause [at issue] contain[ed] no specific exclusions exempting specific disputes. The court also rejected Kroger’s argument that the grievance was exempted by the consolidated benefit plan, which Kroger said was built into the collective agreement. The court explained that Kroger could not “show that the [consolidated benefit plan] has been clearly identified in [the collective bargaining agreement] and that the Union would not be surprised or face difficulties with its incorporation. The Sixth Circuit also rejected Kroger’s attempt to rely on extrinsic evidence, explaining that the evidence spoke “of the substance of the matter”, not of arbitrability.
International Brotherhood of Teamsters, Local # 413 c. Kroger Co., n Â° 21-3228 (6th Cir. 24 Nov. 2021).