Finding that a merged airline was arguably justified in its reading of a collective bargaining agreement to permit it to operate two air carriers separately until such time as the parties reached an agreement fully merging the airlines’ pilots, the Sixth Circuit vacated a lower court’s grant of a preliminary injunction ordering the airlines to bargain over union proposals under Section 6 of the RLA. The language of the relevant CBA contractual provision arguably implied that the airlines did not have to bargain over Section 6 proposals involving all pilots of the combined airlines until the union and airlines reached an agreement as to how the new pilots fit under the CBA. Thus, bargaining over the union’s Section 6 proposals would have to wait (Flight Options, LLC v. International Brotherhood of Teamsters, Local 1108, October 16, 2017, Thapar, A.).
A few years ago, Flight Options announced that it would acquire and merge operations with Flexjet. The airlines and their pilots’ union have been fighting ever since. This appeal is about how to integrate the pilots under one collective bargaining agreement.
Contract merger. The Teamsters union has represented the Flight Options pilots for over ten years. When the companies announced the merger, the Flexjet pilots also elected the Teamsters to represent them. Flight Options and the union already had a CBA that says what should happen in the event of a merger. The relevant provision required the airlines and union to modify the agreement “in those respects necessary to permit the integration” of new pilots. The parties had nine months to execute a modified agreement. If they reached an impasse, the contract mandated binding arbitration.
However, the existing CBA also became “amendable” under Section 6 of the RLA shortly after the airlines merged. After the agreement became “amendable,” either party could propose broad changes affecting the pilots’ rates of pay and working conditions. The union served the airlines with notice of proposed changes just before the parties began their merger negotiations under the CBA.
Two duties to bargain. As a consequence, the parties faced two duties to bargain. Of course, the parties disagreed about how those duties interact. The airlines maintain that the parties must resolve their negotiations under the CBA before turning to the union’s Section 6 proposals. However, the union contended that both negotiations would address the same issues and should happen at the same time. The union presented broad Section 6 proposals, while the airlines focused on narrower issues they deemed necessary for integration. Eventually, the union asked the district court for a preliminary injunction ordering the airlines to bargain over its Section 6 proposals in good faith. The district court granted that injunction, and the airlines appealed.
Scope of negotiations. The district court found that the dispute over the scope of contractual negotiations was minor and left the issue for arbitration. But it assumed that the dispute over the order of negotiations was major. In the district court’s view, the airlines had a “distinct duty to immediately engage in good faith bargaining under RLA Section 6″ and could not “avoid Section 6 bargaining simply because they wanted to prioritize the arguably narrower category of issues under the CBA. On appeal, the airlines argued that the dispute over the order of negotiations was minor and thus should have gone to arbitration.
Interpretation of CBA. The Sixth Circuit first observed that a dispute can be minor even if it affects the parties’ obligations under Section 6. The proper inquiry was whether the existing CBA “controls the controversy.” As an initial matter, the appeals court considered the airlines’ claims that it had a right under the existing CBA to prioritize contractual merger negotiations. It found that they did. Specifically, the airlines claimed that the contractual merger provision did not apply to the Flexjet pilots until the parties completed merger of the Flexjet pilots. So, in the airlines’ view, negotiating Section 6 proposals, which involved rates of pay and work rules for both sets of pilots was premature. Thus, they claimed that the parties must wait until negotiations fold the Flexjet pilots into the existing contractual terms, and then negotiate the broader issues under Section 6. Accordingly, they claimed that this dispute was minor, because it involved interpreting the CBA.
Next, the court examined whether the airlines’ reading of the CBA was arguably justified. It found that it was. The relevant contractual provision provided that until such time as a fully merged agreement is reached, the surviving air carrier may continue to operate the two carriers separately. That language arguably implied that the airlines do not have to bargain over Section 6 proposals involving all pilots of the combined airlines until “such time as a fully merged agreement is reached.” Accordingly, whether the terms of the CBA in fact allowed the airlines to delay Section 6 negotiations must be determined in arbitration. Thus, the appeals court vacated the district court’s grant of preliminary injunction ordering the airlines to bargain over the union’s Section 6 proposals.
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