Case 2:20-cv-18068-KM-JBC Document 17 Filed 06/03/21 Page 1 of 8 PageID: 726
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`UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF NEW JERSEY
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`JNESO, DISTRICT COUNCIL 1, IUOE,
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`Petitioner,
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`v.
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`PRIME HEALTHCARE, ST. MARY’S
`HOSPITAL,
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`Respondent.
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`KEVIN MCNULTY, U.S.D.J.:
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`Civ. No. 20-18068 (KM) (JBC)
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`OPINION
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`JNESO, District Council 1, IUOE (the “Union”) is a labor organization
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`representing employees at St. Mary’s General Hospital, owned by Prime
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`Healthcare. Pursuant to a collective bargaining agreement (“CBA”), the parties
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`arbitrated a dispute involving the Hospital’s refusal to hire a laid-off employee.
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`The arbitrator entered an award in favor of the Union, which petitions to
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`confirm that award. (DE 2.)1 The Hospital cross-petitions to vacate the award.
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`(DE 11.) For the following reasons, the Union’s petition to confirm is
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`GRANTED, and the Hospital’s cross-petition to vacate is DENIED.
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`I. BACKGROUND
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`The Hospital employed a Union member, John Varghese, as a radiation
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`therapist technician. (Award at 2.) He received a temporary layoff notice
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`because the radiation department needed to install a TrueBeam radiation
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`imaging system. (Id.) In the meantime, he filled another vacant position. (Cross-
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`Pet. ¶ 45.)
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`Certain citations to the record are abbreviated as follows:
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`DE = docket entry
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`Award = Arbitration Award (DE 1, Ex. B)
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`CBA = Collective Bargaining Agreement (DE 1, Ex. A)
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`Cross-Pet. = Hospital’s Cross Petition (DE 11-1)
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`Case 2:20-cv-18068-KM-JBC Document 17 Filed 06/03/21 Page 2 of 8 PageID: 727
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`A few months later, the Hospital posted a position for a radiation
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`technician with two to three years’ experience with the TrueBeam system.
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`(Award at 3.) The Hospital did not offer Varghese the role because, in the
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`Hospital’s view, he lacked the requisite experience. (Id.) Nonetheless, Varghese
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`had a radiation therapy license and was authorized to operate any radiation
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`machines after training on them for two days. (Id. at 4.)
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`In response, the Union filed grievances with the Hospital and then
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`initiated an arbitration, contending that the CBA required the Hospital to hire
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`Varghese and train him on the TrueBeam equipment. (Id. at 7–8.) The
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`arbitrator agreed, relying on two provisions of the CBA. The first provided that
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`“[a]n employee subject to layoff may elect to fill any vacant position, provided
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`s/he possesses the necessary qualifications of the position or be provided the
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`opportunity to obtain those qualifications on the same basis as would be
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`afforded a new hire for the position.” (CBA, Art. 16, § 5g.) The second provided
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`that “[p]resently employed bargaining unit members will be given first
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`preference for all bargaining unit jobs.” (CBA, Art. 26, § 2.)
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`The arbitrator, relying on testimony from Varghese and management,
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`reasoned that (1) Varghese could operate the TrueBeam system with two days
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`of training, (2) the manufacturer provides four to five days of training at no
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`cost, (3) the Hospital provides training on equipment, and (4) other hospitals
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`owned by Prime Healthcare provide training on similar equipment. (Award at 9–
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`10.) As a result, “the Hospital failed to adhere to the CBA provision to give first
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`preference to a current bargaining member who is qualified and can perform
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`the job with the training the Hospital could have provided.” (Id. at 10.) The
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`arbitrator ordered the Hospital to assign Varghese to the radiation therapist
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`technician position with backpay and provide him training. (Id. at 11.)
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`II. STANDARD OF REVIEW
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`Section 301 of the Labor Management Relations Act gives federal courts
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`jurisdiction over “[s]uits for violation of contracts between an employer and a
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`labor organization.” 29 U.S.C. § 185(a). In addition, the Federal Arbitration Act
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`empowers federal courts to confirm, vacate, or modify arbitration awards. 9
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`U.S.C. §§ 9–11. Accordingly, federal courts may confirm, vacate, or modify
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`arbitration awards arising from a CBA. Hamilton Park Healthcare Ctr. v. 1199
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`SEIU United Healthcare Workers E., 817 F.3d 857, 861–62 (3d Cir. 2016). In
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`such cases, “courts are restricted in reviewing the decision of an arbitrator”
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`with “a heavy degree of deference.” Monongahela Valley Hosp. Inc. v. United
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`Steel Paper & Forestry Rubber Mfg. Allied Indus. & Serv. Workers Int’l Union
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`AFL-CIO CLC, 946 F.3d 195, 199 (3d Cir. 2019) (citations omitted). Still, courts
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`“will vacate an award ‘if it is entirely unsupported by the record or if it reflects
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`a manifest disregard of the agreement.’” Id. (quoting Citgo Asphalt Ref. Co. v.
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`Paper, Allied-Indus., Chem. & Energy Workers Int’l Union Local No. 2-991, 385
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`F.3d 809, 816 (3d Cir. 2004)).
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`III. DISCUSSION
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`The Hospital offers four reasons to vacate the award: (A) the arbitrator
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`applied the wrong section of the CBA; (B) regardless, the arbitrator
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`misinterpreted the section she did apply; (C) the arbitrator made erroneous
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`factual findings; and (D) the award violates public policy. None is persuasive.
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`A. Correct Section of the CBA
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`The Hospital argues that the arbitrator applied the wrong section of the
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`CBA. (Hosp. Mot. at 4–6.) The arbitrator relied on Article 16, § 5g, which states
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`that “[a]n employee subject to layoff may elect to fill any vacant position,
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`provided s/he possesses the necessary qualifications of the position or be
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`provided the opportunity to obtain those qualifications on the same basis as
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`would be afforded a new hire for the position.” (CBA, Art. 16, § 5g.) Instead, the
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`Hospital contends, the arbitrator should have applied § 6, which provides that
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`“[w]henever a vacancy or newly created position occurs in a bargaining unit job
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`classification, bargaining unit employees shall be recalled in accordance with
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`seniority in the reverse order in which they were laid off, provided they possess
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`the necessary skill and ability to perform the job.” (CBA, Art. 16, § 6.) The
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`difference between the two provisions is that, under § 5g, an employee need not
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`already possess the qualifications but can be given an opportunity to obtain
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`them (i.e., training), while under § 6, no such option is available. If § 6 applies,
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`the Hospital reasons, then the award cannot stand because Varghese did not
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`have two to three years’ TrueBeam experience and the arbitrator could not
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`compensate for that lack by ordering the Hospital to provide training.
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`This argument comes down to a question of contract interpretation: Did
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`the arbitrator correctly conclude that Varghese was “subject to a layoff” within
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`the meaning of § 5g? An alleged “misinterpretation of the contract,” however,
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`does not ordinarily provide a basis to vacate an arbitration award. Citgo, 385
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`F.3d at 815 (citation omitted). In rare circumstances, courts may vacate an
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`award “where there is a manifest disregard of the agreement, totally
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`unsupported by the principles of contract construction and the law of the
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`shop.” Id. at 816 (citation omitted). But this only occurs when an arbitrator so
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`departs from the plain language of the agreement that the arbitrator essentially
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`“dispense[s] his own brand of industrial justice.” Monongahela Valley, 946 F.3d
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`at 199 (citation omitted).
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`I cannot say that happened here. The application of the phrase “subject
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`to a layoff” to these facts is open to interpretation. The Hospital says that § 5g
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`“is limited to the circumstance when an employee is initially identified for
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`layoff” and allows him to “move[] into a vacant position to avoid layoff.” (Hosp.
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`Mot. at 8.) That is a reasonable interpretation, but not the only one.
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`There are no strong indicia in the CBA as to the temporal limits of
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`“subject to a layoff.” Generally, “subject to” means “affected by or possibly
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`affected by (something).” Subject to, Merriam-Webster, https://www.merriam-
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`webster.com/dictionary/subject%20to (last visited May 26, 2021). The
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`arbitrator could rationally conclude that Varghese was “affected by” the layoff
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`when the new position opened up because he was currently occupying a
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`position by virtue of the fact that he had been laid off. Moreover, this was not
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`some open-ended or permanent change of status; this was a temporary layoff
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`pending completion of the TrueBeam system. One could reasonably conclude,
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`then, that Varghese remained in laid-off status. Whether or not this is the best
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`reading of the CBA is not the issue; the arbitrator’s interpretation is a
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`reasonable one, which draws its essence from the CBA and does not bespeak a
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`personal brand of industrial justice. When there are multiple reasonable
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`interpretations, the arbitrator’s pick among them cannot be erroneous and
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`must stand. Monongahela Valley, 946 F.3d at 199–200.
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`B. Misapplication of the CBA
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`As a backup, the Hospital contends that, even if § 5g applies, the
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`arbitrator misapplied that section. Here, the Hospital focuses on the award’s
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`provision that Varghese could readily be trained to operate the TrueBeam
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`system. Because new hires for the position would presumably already be
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`qualified without further training, the Hospital reasons, Varghese would not be
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`taking the position “on the same basis” as a “new hire.” (CBA, Art. 16, § 5g.)
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`Again, the Hospital’s argument is not unreasonable, but it cannot
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`outweigh the “heavy degree of deference” I give to the arbitrator. Monongahela
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`Valley, 946 F.3d at 199. The arbitrator reasoned that, as a general matter, the
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`Hospital could rapidly provide the supplemental training that would qualify
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`Varghese to operate the TrueBeam system. (Award at 9–10.) The language of
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`§ 5g is somewhat general, stating that the Hospital must provide the same
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`opportunities as “a new hire for the position.” (CBA, Art. 16, § 5g.) See United
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`States v. Hendrickson, 949 F.3d 95, 98 (3d Cir. 2020) (explaining that the
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`indefinite article “a” “has a generalizing force on the noun that follows it”
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`(citations omitted)). Given the evidence the arbitrator heard, the arbitrator
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`could reasonably conclude that the manufacturer’s training or Prime
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`Healthcare’s training at other hospitals was of the same kind generally
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`available to any new hire.
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`I reiterate that courts do not vacate awards unless they violate the spirit
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`of the CBA. See Monongahela Valley, 946 F.3d at 199 (“[A]n award must still
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`draw its essence from the words of the [CBA] . . . .” (cleaned up)). The purpose
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`of the CBA provisions ostensibly is to use Union members for positions
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`whenever feasible. The Hospital could very easily do so in this case, according
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`to the arbitrator’s view of the evidence. To adopt the Hospital’s proffered
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`interpretation would allow a runaround of that purpose by incentivizing the
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`Hospital to affirmatively seek out hirees whose qualifications exceed those of
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`the Union workers, even if the Union workers could easily obtain those
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`qualifications. The arbitration award here draws its essence from that
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`obligation to hire Union members when possible.
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`In sum, the Hospital cannot show that the arbitrator’s award so departs
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`from the CBA as to warrant vacatur.
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`C. Factual Errors
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`The Hospital argues that the arbitrator made three erroneous findings of
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`fact: (1) the arbitrator relied on Varghese’s testimony to establish training
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`requirements, (2) the arbitrator relied on a document to establish the job
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`description that wrongly listed the necessary experience to be one year, and
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`(3) testimony about available training on similar equipment was too vague to
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`permit a conclusion that it was relevant to the TrueBeam system. (Hosp. Mot.
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`at 13–18.) But “a reviewing court must defer to the arbitrator’s factual findings”
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`as “the exclusive province of the arbitrator.” Citgo, 385 F.3d at 816; see also
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`Major League Baseball Players Ass’n v. Garvey, 532 U.S. 504, 508 (2001)
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`(“[I]mprovident, even silly, factfinding does not provide a basis for a reviewing
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`court to refuse to enforce the award.” (quotation marks and citation omitted)).
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`This is so because the parties agreed to have facts resolved by the arbitrator.
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`Garvey, 532 U.S. at 509–10. Accordingly, I cannot vacate the award based on
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`alleged factual errors.2
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`Nor can I say that this award was “entirely unsupported by the record.”
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`Monongahela Valley, 946 F.3d at 199. The Hospital’s first and third alleged errors are
`based on allegations that findings were not supported by the correct or adequate
`testimony. They were, however, based on some testimony; the question is one of
`interpretation. As to the second alleged error, the arbitrator explained that the position
`originally called for one year of experience but was amended to require two to three.
`(Award at 3.)
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`D. Public Policy
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`Finally, the Hospital argues that the award runs contrary to public
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`policy. (Hosp. Mot. at 18–20.) There is an exception to general rule of deference
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`to arbitrators when the award “violates a well defined and dominant public
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`policy.” Exxon Shipping Co. v. Exxon Seamen’s Union, 73 F.3d 1287, 1291 (3d
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`Cir. 1996) (quotation marks and citation omitted). “[A]ny such public policy
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`must be explicit, well defined, and dominant. It must be ascertained by
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`reference to the laws and legal precedents and not from general considerations
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`of supposed public interests.” E. Associated Coal Corp. v. United Mine Workers,
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`531 U.S. 57, 62 (2000) (quotation marks and citation omitted).
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`As a qualifying public policy, the Hospital points to propositions in
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`Belmar v. Cipolla, 475 A.2d 533 (N.J. 1984). There, the New Jersey Supreme
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`Court addressed whether a hospital’s exclusive contract with a group of
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`anesthesiologists for the provision of all anesthesiologic services at the hospital
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`violated public policy. Id. at 534. The court explained that it “normally do[es]
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`not interfere with a reasonable management decision concerning staff privileges
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`as long as that decision furthers the health care mission of the hospital.” Id. at
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`538. Nonetheless, hospitals must “balanc[e] the interests of the hospital
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`management with those of a doctor who desires to practice at the hospital,”
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`always with an eye towards public health. Id.
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`The Hospital argues that the arbitrator violated the principles stated in
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`Belmar by overruling the Hospital’s view of the necessary qualifications to serve
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`patients. (Hosp. Mot. at 20.) Assuming that the Belmar principles are a well-
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`defined public policy,3 the Hospital’s argument fails because the award is not
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`contrary to those principles. It might be the case that permitting an unqualified
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`person to operate the TrueBeam system has public policy implications. But I
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`cannot disturb the arbitrator’s factual findings that Varghese could readily
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`become qualified for the position with training available to the Hospital. Thus, I
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`One can doubt, however, that the public policy concerns of Belmar have the
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`same force here. Belmar deals with privileges for doctors, not technicians.
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`cannot reason, as the Hospital would like, that the award risks public health
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`by forcing the Hospital to employ an unqualified employee. See Rohm & Haas
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`Co. v. United Steel, Paper & Forestry, Rubber, Mfg., Eng., Allied Indus. & Serv.
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`Workers Int’l Union, AFL-CIO-CLC, 781 F. Supp. 2d 251, 256 (E.D. Pa. 2011)
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`(argument that award violated public policy against workplace violence failed
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`because arbitrator found that worker was not dangerous).
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`IV. CONCLUSION
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`For the reasons set forth above, the Union’s petition to confirm the
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`arbitration award is granted, and the Hospital’s cross-petition to vacate the
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`arbitration award is denied.
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`A separate order will issue.
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`Dated: June 3, 2021
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`/s/ Kevin McNulty
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`___________________________________
`Hon. Kevin McNulty
`United States District Judge
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