Court upholds arbitrator’s award finding unilateral change in past practice, rejects public policy challenge

By John H Curley on January 6, 2019

The District Court for the Northern District of Illinois has confirmed an award of Arbitrator Edward Krinsky that found Mondelez Global improperly and unilateral modified a past practice allowing employee to voluntarily work seven days without a day of rest. Mondelez Global, LLC v International Association of Machinists and Aerospace Workers, AFL-CIO, District 8, Local Lodge 1202.

For “many years” employees had been allowed, on a voluntary basis, to work seven consecutive days during a calendar work week without having 24 hours of rest. In 2013 a new Human Resources Director became aware of an Illinois statute providing that employers “shall allow every employee … at least twenty-four consecutive hours of rest in every calendar week in addition to the regular period of rest allowed at the close of each working day.” The statute also provided that the Department of Labor could grant permits authorizing the employment of a person on days of rest based on, among other things, “business necessity and economic viability in granting such permits.” The Company requested permits from the DOL but never received them. In 2015, the company modified its practice, and refused to allow employees not covered by a valid permit to voluntarily work seven days straight.

The Machinists Union grieved this action and the matter was ultimately submitted to arbitration. Arbitrator Krisnsky sustained the grievance, concluding that there was insufficient evidence that the statute prohibited employees from voluntarily working without day of rest, that the contract did not prohibit such a practice, and that the Company acted improperly in terminating the practice during the term of the agreement. He noted:

The Company was obligated to continue the practice during the life of the Agreement unless there was an agreement with the Union to change it. Without such an agreement to change the practice, the Company could have notified the Union of its intent to end the practice and that could then have been the subject of bargaining for the next Agreement. The Company could not simply end the practice unilaterally during the term of the Agreement.

In reaching his decision Arbitrator Krinsky found support in an earlier award of Arbitrator Amadeo Grieco involving a similar dispute at another facility of the Company. (That award was confirmed in Mondelez Global, LLC v. International Association of Machinists and Aerospace Workers, AFL–CIO, District 8) Arbitrator Grieco had similarly rejected the Company’s position on the need to eliminate the past practice, noting that the statute was at least ambiguous and also noting prior testimony of a former DOL General Counsel that a side agreement between a City and a police union allowing police to voluntarily work seven consecutive days did not violate the statute.

In rejecting the Company’s request to vacate the award, the Court found no basis for the Company’s claim that it was contrary to public policy as compelling the Company to violate the day of rest statute. The Court concluded:

In sum, the cited provision of ODRISA, as it has been administered by the IDOL, allows parties to contract around it, which is exactly what Mondelez and the union have done for many years. Accordingly, the arbitrator’s decision was not contrary to a “well defined and dominant” public policy. And as the arbitrator correctly concluded, MG was not entitled to unilaterally change a long-standing mutually understood and implemented past practice, particularly one effectively memorialized in the CBA, without bargaining with the union.