Arbitration in the Matter Between

MID-AMERICAN ELEVATOR COMPANY, INC.

and

FMCS Case No. 97-13958

Issue: Breach of Contract Refusal to Bargain

Grievant: Mid-American Elevator Company, Inc.

INTERNATIONAL UNION OF ELEVATOR CONSTRUCTORS, LOCAL NO.2 Arbitrator: Stephen L. Hayford

PRELIMINARY STATEMENT

This matter was presented to the Arbitrator at a hearing held on November 14, 1997, in Chicago, Illinois. The exchange of post-hearing briefs was completed on January 8, 1998.

APPEARANCES

For the Company:

Irving N. Geslewitz Attorney and Spokesperson

Robert R. Bailey" I President and Witness

For the Union:

Robert Matisoff Attorney and Spokesperson

Benjamin Davis Co-Counsel

Edward C. Weidner -Local Union No.2 Business Manager and Witness

John Quackenbush Witness

Edward Sullivan Assistant to the General President IUEC and Witness

2

I. BACKGROUND AND FACTS

The Mid-American Elevator Company, Inc. ("the Company") is a party to the "Short Form" Agreement with Local 2 of the International Union of Elevator Constructors ("the Union"). Under the terms of that Agreement, and consistent with well-established practice in the elevator construction industry, the Company has for years used teams of bargaining unit members consisting of an Elevator Constructor Mechanic and an Elevator Constructor Helper on construction projects. The evidence in the record shows that in large part, Mechanics and Helpers perform the same job duties. Mechanics are assigned to direct the work of the Helper and to ensure that quality, safety, and other standards are met.

Over the years, the Company has performed SUbstantial construction work on federal and federally funded projects. The Davis-Bacon Act1 regulates the wages paid on such projects. Pursuant to the Act and pursuant to regulations periodically promulgated by the Wage and Hour Division of the U.S. Department of Labor (DOL), the wages paid to employees on federal and federally funded construction projects must be those "prevailing" for similar workers on such projects in the given geographic area. Traditionally these regulations have recognized only "journeyman" and "apprentice" job categories. They did not generally contemplate the use of employees classified as "helpers." -

The Elevator Constructor trade was long an exception-to this general rule. Prior-to 1991, the DOL frequently included the classifications' of Elevator Constructor Helper and Elevator Constructor Probationary Helper within the wage determinations it issued for federal projects. If the wage determination for a particular project did not include the Elevator Constructor Helper classifications, the employer could request that it be added by filing a DOL Form 1444, "Request for Authorization of Additional Classification and Rate," with the Wage and Hour Division of the DOL.

The evidence in the record indicates that effective February 4, 1991, the DOL issued regulations expressly permitting helper rates (for all trades) to be issued in _Davis-Bacon Act wage determinations, thereby facilitating the addition of prevailing helper classifications to contract wage determinations.2 The effect of this change in the relevant DOL regulation3 was to permit the use of helper classifications on all federal or federally funded construction projects in trades where the helper classification was recognized and utilized in the relevant geographic area. As a result of that regulation, for a period of some two years (from November 26, 1991, through October 1993), the DOL generally permitted the use of helpers on federal and federally funded construction projects.

In 1993; Congress prohibited the expenditure of _ any DOL funds to implement or administer the helper regulations.4 As a result, the DOL suspended the helper regulations. Notice of that suspension was placed in the Federal RegisterS and was given in Agency

1 40 U.S.C. § 276 et seq. 2 The evidence indicates that the DOL also generally recognized helper classifications on Davis-Bacon Act construction jobs during the period from December 4, 1990 to April 10, 1991. 355 Fed. Reg. 50149 (Dec. 4, 1990), codified at 29 CFR §§ 1.7(d) 5.2(n)(4) and 5.5(a)(1 )(ii)2. 4 Department of Labor Appropriations Act, 1993, § 103 P.L. 103-12, 107 Stat. 1082, 1089 (Oct. 21, 1993). 558 Fed. Reg. 58955 (Nov. 5, 1993).

3

Memorandum No. 174 (Jan. 7, 1994, codified at 59 Fed. Reg. 1029), and in an undated Notice from the Wage and Hour Division of the DOL entitled "Prohibition on Use of Survey Wage Data for Helpers." On December 30, 1996, the DOL adopted a final rule suspending the helper regulations.6 The evidence in the record indicates the suspension of the DOL helper regulations remains in place to date.

As a result of the above-described Congressional and DOL actions, use of the helper classification on federal and federally funded construction projects effectively ceased. For jobs bid after October 21, 1993, the Wage and Hour Division of the DOL has not included helper classifications in Davis-Bacon Act wage determinations. Pursuant to longstanding DOL policy, helper classifications can be included in added to wage determinations only where (a) the duties of helpers are clearly defined and distinct from those of the journeyman classification and from the laborer, (b) the use of such helpers is an established prevailing practice in the area, and (c) the term "helper" is not synonymous with "trainee" in an informal training program.

The instant dispute arose as a result of the Company's successful bid on two federally funded elevator construction projects in the Chicago, Illinois area. The contract for the Chicago Transit Authority (CTA) Green Line project was awarded to the Company on June 26, 1995. The Chicago Housing Authority (CHA) Henry Horner Homes Project contract was awarded to the Company on June 29, 1995. The DOL wage determination for both these projects (No. IL950009) did not list wage rates for Elevator Constructor Helpers or Probationary Helpers.

The evidence shows that Company President Robert Bailey III bid these two jobs assuming the Company would be able to pay its Helpers at the lower Helper rates specified in the Standard Agreement between the Parties. Shortly after the contracts were awarded, Local No. 2 Business Manager Ed Weidner told Company Project SuperVisor Kit Moran that Helpers working on these two projects would have to· be paid at the Mechanic's wage rate. That­conversation set in motion a sequence of events that led to the instant Grievance? Eventually, the Company requested that Local No.2 join it in signing Form 1444 Requests for the addition of the Elevator Constructor Helper classifications for the CTA Green Line and the Henry Horner Homes projects. Local No. 2 Business Manager Weidner informed the Company of his unwillingness to sign the Form 1444 for either project, and the Company submitted the Forms to the appropriate local CTA and CHA officials with but the Union's Signature.

After proceeding through the local level, the Forms 1444 Requests were submitted to the DOL, whereupon the Company's requests for addition of the Helper classification were rejected. To date on both the CTA Green Line and Henry Horner Homes projects, the Company continues to pay employees in the Helper classifications at the wages rates specified in the Standard Agreement, amounts less than the contractually-set Mechanic's wage rate. At the same time, the Union has continued to make known to the Company and to the DOL its objection to the Company's failure to pay Helpers at the Mechanic's rate.

On August 15, 1996, the Company submitted a written Step 1 Grievance (Joint Exhibit No. 4). That Grievance states in relevant part:

661 Fed. Reg. 68641 (Dec. 30, 1996). 7 Some of those facts are in dispute and are addressed more fully in the sections below.

4

We are legal counsel to Mid-American Elevator Co., Inc. ("Mid-~merican"), with whom you have a collective bargaining relationship on behalf ::>f all elevator constructor mechanics and helpers who are employed by Mid-Ameri:.:m.

We are writing at Mid-American's request to protest the course- of conduct our Union has been following in contesting Mid-American's use of heipe--s on federally­financed and federally-assisted construction contracts. We believf- this conduct directly undermines the collective bargaining agreement and als~ violates the National Labor Relations Act. If steps are not taken to rectify the situation, legal action will have to be pursued.

As you know, the current (1992-1997) Standard Agreement between the National Elevator Industry, Inc. and the International Union of Elevator Contractors [sic], to which your local and Mid-America [sic] are bound, specifically recognizes two classifications: mechanics and helpers. Under the agreement, herDers are paid at seventy percent (70%) of the mechanic's rate (Article IV(A), 111 D°, and must meet certain qualifications (set forth in Article X). Article X, 112 recognizes that "[t]he total number of Helpers employed shall not exceed the number of Mechanics on anyone job, except on jobs where two teams or more are working, one extra Heloer may be employed for the first two teams and an extra Helper for each add:tional three teams."

In spite of this express language recognizing and authorizing the ::mployer's use of helpers on any job, you have been actively lobbying the federal government to refuse to accept Mid-American's use of the helper classification and the helper pay rate on federally funded construction projects. In so doing, you have been deliberately undermining the collective bargaining agreement by misrepresenting to the government that the agreement does not authorize use of elevator construction helpers when precisely the opposite is true.

Thus, in a letter you sent Pamela J. Beavers of the Office of Federal Contracts Compliance on April 5, 1996, you stated:

"Mr. Moran [of Mid-American] feels he has the authority to arbitrarily and unilaterally establish a new "classification" for elevator contractor helpers. It is erroneous on his part to think that he could do this without utilizing the "collective bargaining" procedures that are clearly defined in the contract that the I.U.E.C. has with all Signatory companies (including MidAmerican Elevator company)."

You further stated:

"It seems to rr. ~ that Mid-American Elevator, Co. was, at the conclusion of the meeting, unwilling to yield on its unilaterally imposed classification for elevator construction helpers."

At the conclusion of the letter, you threatened to file a complaint with the Department of Labor ("DOL") if Mid-American does not stop using helpers.

We believe that it is the Union that is violating the collective bargaining agreement here by misleading the government into believing that the helper classification is not recognized and authorized by the collective bargaining agreement when in fact it is. The whole purpose of the Davis-Bacon Act is to ensure that wages being paid on federally financed construction projects meet. prevailing wage standards. The I.U.E.C. Standard Agreement sets the prevailing wage standard with respect to elevator construction work, and it expressly provides for the use of helpers. Mid-Americans' use of helpers therefore does clearly meet the prevailing standard, and to suggest otherwise to the government is a misrepresentation. This is particularly so in that for years Mid-American, consistent with the collective bargaining agreement, has been using helpers on federally financed projects, which are a significant portion of Mid-American's business.

Just recently, as a result in part of your lobbying effort, Mid-America {sic] has been notified by the DOL that it will not recognize the helper classification on some projects. If this action is not reversed, it will result in large losses to Mid-American.

Mid-American intends to hold your Union accountable for all such losses. You cannot enter into a collective bargaining agreement in which you pledge to honor and abide by its terms, and then take action that deliberately undermines those terms. That amounts to a breach of the duty of good faith and fair dealing that is inherent in all contracts, and particularly labor contracts. Such conduct also amounts to a violation of §8(b)(3) of the National Labor Relations Act.

We therefore request your written pledge to take immediate action to cooperate with Mid-American in taking whatever steps are necessary to obtain a reversal of the DOL's position with respect to Mid-American. If you do not, then Mid­American will have no choice but pursue its legal remedies against your Union, including seeking remedies for the Union's breach of contract and unfair labor practices.

Please consider this letter as an initiation of the grievance procedure under Article XV of the agreement. '

5

On October 7, 1996, the Company filed a formal written Grievance at Step 2 of the contractual procedure. That Grievance (Joint Exhibit No.5) states in relevant part as below:

We represent Mid-American Elevator Co., Inc. ("Mid-American"), a Signatory employer to the collective bargaining agreement between NEil and the IUEC. On August 15, 1996, we sent the attached letter to Edward C. Weidner, business manager of IUEC Local 2, protesting conduct by him on behalf of the Union that we believe violates and undermines the collective bargaining agreement between the parties. We told him to consider that letter as a grievance under the agreement's grievance procedure.

Mr. Weidner never submitted a written response to our letter, but has orally informed us that .he does not agree with our position and will not take the action we request. Accordingly, please consider this as an appeal to Written Step Two of the grievance procedure.

6

The gist of Mid-American's grievance is set forth in the attached August 15, 1996 letter. To summarize, Mid-American is performing several projects for the federal government. Mid-American failed to notice at first that the contract specifications for the projects did not include the helper classification. Since Mid­American had been performing federal projects for years using helpers and. since the helper classification appears in the collective bargaining agreement, the non­inclusion of the helper classification appeared to be an obvious oversight. When this was brought to the attention of DOL personnel, their initial reaction was that a correction would not be a problem.

The Local, however, took the position that the DOL should not recognize the helper classification and, following a meeting with government personnel, sent the attached letter dated April 5, 1996 claiming that Mid-American's use of the helper classification violated the collective bargaining agreement. This was an outrageously untrue statement, as the collective bargaining agreement expressly recognizes the classification of helper. Unfortunately, due in part to the Local's position, the DOL notified us that it would not recognize the helper classification on the projects in question unless we submitted a formal "Request for Authorization of Additional Classification Rate," known as a Form ·1444.

In order to do so, we needed to obtain the signature of the Union representative attesting that he concurred that the helper classification be recognized as a separate and distinct class of worker distinguished from the journey­level (mechanic) classification listed on the wage classification (see sample Form 1444, attached). When we asked Mr. Weidner to do so, he refused, thereby again preventing us from being able to process the request.

Mr. Weidner has offered all sorts of exc\Jses for not complying with this simple request, none of which are acceptable. His action on behalf of the Union is causing us potential exposure to many thousands of dollars in liability. The IUEC standard agreement sets the prevailing wage standard with respect to elevator work and expressly provides for the use of helpers. It is completely unacceptable for any party to pledge to honor and abide by the agreeme'nt and then take action that deliberately undermines those terms.

As time is critical, we request that this matter be expedited. We want the complete and active cooperation of the Union in rectifying the situation, not only by signing the Form 1444, but by letting the DOL know that Mid-American's use of the helper classification should be recognized as meeting prevailing standards. If the Union does not agree to this, then we would like this matter advanced to the arbitration stage as soon as possible.

Please advise at your earliest convenience as to the next acti·')n to be taken.

The instant Grievance progressed through the contractual procedure without resolution. It was advanced to arbitration before the undersigned in the manner described above.

7

II. THE ISSUE

At the leave of the Parties, the Arbitrator has framed the issue before him in this Matter as follows:

Did the Union violate any of the express terms of, or any the express or implied duties arising under, the Short Form Agreement and/or the Standard Agreement? If so, what is the proper remedy?

III. RELEVANT PROVISIONS OF THE STANDARD AGREEMENT

A. ARTICLE IV Work Jurisdiction

B. ARTICLEV Wages

C. ARTICLEX Designation of Helper's Work and Qualifications

D. ARTICLE XV Arbitration

E. ARTICLE Scope and Terms of Agreement

IV. POSITION OF THE COMPANY

The Company maintains the Union has both violated the Standard Agreement and failed or refused to bargain in good faith in violation of Sections 8(b)(3) and 8(d) of the Labor Management Relations Act (LMRA). Each of these claims is addressed separately in the text below.

The Claimed Violation of the Standard Agreement

The Company asserts the Union violated the Standard Agreement and the covenant of good faith and fair dealing it believes inherent in the Agreement. It contends the violation of the Agreement resulted from the Union's efforts to deprive it of the benefit of its bargain in negotiating the wage rates for the Elevator Constructor Helper job classifications. The Company's contention in this regard is premised on the fact that the Standard Agreement between the Parties recognizes the Elevator Constructor Helper and Frobationary Helper classifications. the first of which is paid at a wage rate 70 percent of the Mechanics' wage rate and the latter at 50 percent of the Mechanics' wage rate.

The Company insists the reduced wage and benefit levels for both classifications was a material factor in .its willingness to become a signatory to the Agreement. It argues the

8

Covenant of Good Faith and Fair Dealing is generally recognized as inherent in all contracts. 8

That implied covenant precludes a party to a contract from attempting to deprive the other party of the benefit of its contractual bargain by evading the letter and the spirit of the contract. The Company cites extensive legal precedent and scholarly commentary on this point and avers that the duty of good faith and fair dealing is particularly significant within the· context of an ongoing collective bargaining relationship between an employer and a union.9

The crux of the Company's claim that the Union has breached its duty of good faith and fair dealing and thereby violated the Standard Agreement is the assertion that the Union took opportunistic advantage of the circumstances presented by the above-recounted Congressional and DOL actions leading to the Department's refusal to recognize the Elevator Constructor Helper classifications. It submits the Union improperly took advantage of the DOL's decision to terminate the long-standing recognition of the Helper classifications in the elevator construction industry and did so in the face of the express language of the Parties' Standard Agreement and the long history between the Parties whereby the Helper classifications had always been used on federal and federally funded construction projects.

The Company cites further to the actions of Local No. 2 Business Manager Weidner in writing to Chicago Transit Authority (CTA) Chief Executive Pamela Beavers complaining of the Company's failure to pay Helpers at the Mechanics' wage. rate (Union Exhibit No.9. In the Company's view, the actions of Business Manager Weidner and the Union were significant factors in the eventual decision by the DOL to deny its request to add the Elevator Constructor Helper wage rates to the wage determinations for the CTA Green Line and Henry Horner Homes projects. The Company rejects the Union's claim that it was not obligated to assist in the effort to secure approval of the Form 1444 Request to add the Helper classification to the wage determinations for the subject projects. .

The key to the Company's position in this regard is the contention that the Union's failure to seek effectuation of the contractual bargain reflected by the inclusion of the Elevator Constructor Helper classifications wage rates in the Standard Agreement evidenced bad faith sufficient to constitute a breach of the Agreement. It draws analogies to arbitral principle in the areas of subcontracting and successor employers as establishing that the parties to a collective bargaining agreement have an implied good faith obligation to attempt to secure effectuation of the Agreement's terms. 10 Because the Parties' Standard Agreement unequivocally evidenced an agreement between them establishing the Elevator Constructor Helper classifications, the Company believes the Union was not faced with a "close call" in deciding whether to support its

8 Restatement of Contracts 2d., § 205. 9 The Company submits that because of the special duty of good faith (presumably the §8(a)(5) and §8(b)(3) unfair labor practice proscriptions) imposed by the LMRA, the contract law-based duty of good faith and fair dealing has an "enhanced application" with regard to collective ba.gaining agreements. See, e.g., USWA v. New Park Mining Co., 273 F.2d 352, 356 (10th Cir. 1959) (convenant of good faith and fair dealing "must inhere in every collective bargaining agreement if it is to serve its institutional purpose"), lAM Local 1912 v. United States Potash Co., 270 F.2d 496,498 (3d Cir. 1959) ("covenants of good faith and fair dealings ... are the very life blood of collective bargaining agreements."). 10 In this regard, the Company cites to Zady Natey, Inc. v. UFCW Int'l Union, 995 Fed. 2d. 496 (4th Cir. 1993), and Westinghouse Hanford Co. v. Hanford Atomic Metal Trades Council, 940 Fed. 2d. 513 (9th Cir. 1991).

9

Form 1444 request for recognition of the Helper classifications by the DOL with regard to the two subject projects.

The Company rejects the Union's argument that the DOL would have denied the Form 1444 Requests regardless of the Union's actions. It reasons that the DOL, when confronted with mutual requests by the Union and the Company to recognize the Elevator Constructor Helper classifications, would likely have granted the request. Essential to the Company's position in this regard is its assertion that the Union failed to prove that the DOL had changed its position regarding the Helper classifications in 1993. In particular, the Company asserts that neither All Agency Memorandum No. 174 nor the DOL's notice of the suspension of the Helper regulations said anything about a change in policy with regard to Elevator Constructor Helpers.

Instead, the Company believes these notices made clear that the DOL would reinstate its prior practice of using the "three-part test" for recognizing the Helper classification in various trades. The Company asserts the Elevator Constructor Helper classification had always been recognized under that test. Thus, the reference in the Memorandum and Notice to reinstating "prior practice" must have meant a return to the traditional practice in the elevator construction industry. In the absence of any probative evidence of a change in DOL policy in 1993, or at any time prior to the Company's filing of the Form 1444 Requests at issue here, the Company submits the Union's claim that its actions made no difference in the DOL disposition of the Form 1444 Requests must be rejected.11 .

The Company also challenges the Union's assertion that its actions were justified by the duty of fair representation it owes to its members. In the Company's view, even if the DOL had changed its pOSition regarding the Helper classification, the Union's action in seeking to stiffen the DOL's opposition to the Company's Form 1444 Requests was at cross purposes with the language it had agreed to in the Parties' Standard Agreement. The Company insists the same could be said for the Union's representation at the hearings as to its efforts to secure DOL approval of the Helper training program as a certified apprenticeship or training program that would satisfy the three-step test for addition of helper classifications now being applied by the DOL under the Davis-Bacon Act. It contends the Union's motivation in that regard was entirely selfish (Le., in order to avoid the apprenticeship program of another union being recognized), and did not constitute a good faith effort to secure DOL recognition of the Elevator Constructor Helper classification.

The Refusal to Bargain Claim

Based on its arguments pertaining to the alleged contract violation by the Union, the Company asserts that the Section 8(b)(3) unfair labor practice charge it brought against the Union, which was deferred to arbitration by the National Labor Relations Board, should be

11 The Company believes the Union's influence over the change of position in the Department of Labor with regard to the Elevator Constructor Helper classifications is demonstrated by the fact that the DOL had in 1986 unequivocally determined that helper classifications negotiated in collective bargaining agreements are appropriate for inclusion in Davis-Bacon Act wage determinations. In Hawk View Apartments, WAB Case No. 85-20 (1986), the precursor to the current Administrative Review Board held that even though a particular category of helpers may not technically meet all three prongs of the test for the recognition of helpers, the classification must still be recognized if it meets the prevailing standards wholly derived from negotiations between the craft union and employers.

to

decided in the Company's favor. It reasons that by urging the DOL not to recognize the Elevator Constructor Helper classifications during the term of the Standard Agreement, the Union violated Section 8(b}(3} and Section 8(d} of the LMRA. The Company contends that a failure to bargain in good faith as required by the Act occurred when the Union attempted to force a better bargain (by resorting to the DOL) than the one it was able to achieve at the collective bargaining table. The Company argues that in analogous circumstances, similar attempts by unions to undermine the clear terms of collective bargaining agreements have been found to violate the LMRA.12

Conclusion

Based on the arguments summarized above, the Company requests that the Arbitrator sustain the Grievance and award appropriate relief to the Company. It believes the appropriate measure of damages is one that would indemnify or make the Company whole for all losses it may experience as a result of the DOL's refusal to recognize the Elevator. Constructor Helper classifications on the two projects in question.13 That amount would include:

• any amounts the DOL may order withheld. from payments due the Company from the contracting agencies on the CTA Green Line .and Henry Homer Homes projects;

• the Company's fees for legal services with regard to this proceeding; and

• prejudgment interest on the entire amount of damages.

In addition, because of the difficulty in calculating the amount of damages that may be due the Company, it requests the Arbitrator to retain jurisdiction over this Matter in order to resolve any· questions or disputes that may arise in the future as to the precise amount due.

Finally, the Company asks that the Union be directed to cease and desist from all conduct in violation of the Standard Agreement, and further be required to notify the DOL that it is reversing its opposition to the Company's Form ·1444 Requests with regard to the Elevator Constructor Helper classification on the CTA and Henry Homer Homes projects.

v. POSITION OF THE UNION

The Union asserts the instant Grievance should be denied on substantive arbitrability grounds and on the merits. Each of these arguments is addressed in tum below.

12 Communication WorKers of America, AFL-C/O, 474 Fed. 2d. 778 (2d. Cir. 1972). 13 In its post-hearing brief, the Company notes the award may also include a conditional provision striking from the remedy order the reference to the amount of payments withheld by the DOL, in the event the DOL should reverse its decision as to recognition of the Elevator Constructor Helper classifications.

II

The Substantive Arbitrability Claim

The Union asserts the Arbitrator is without authority to decide the present dispute between the Parties. It notes that Article XV of the Standard Agreement provides that the grievance and arbitration procedure contained therein applies to "[a]ny difference or dispute regarding the application or construction of this Agreement, .... " Article XV also makes clear that the arbitrator "does not have the authority to add to, subtract from, or modify in any way the provisions of this Agreement." Relying upon these limitations, the Union contends the Company has failed, in the written grievances and at the hearing in this Matter, to identify the particular provisions of either the Standard Agreement or the Short Form Agreement which the Union is alleged to have violated. It emphasizes that no provision of either agreement requires the Union to assist an employer submitting a form {like Form 1444) to a government agency. In addition, there is no express language in the Agreement that requires the Union to cooperate in petitioning the government for an exemption from regulations intended to benefit the individuals the Union represents.

The Union observes that because the Company cannot identify any provisions of the Agreement it believes. to have been violated, it instead asks the .Arbitrator to sustain the Grievance based on the Union's alleged violation of some "implied" duty to refrain from "bad faith" actions. The Union finds no such duty or covenant stated within the language of the Standard Agreement. In that regard, it notes the language of the Article XXIII "zipper clause," which precludes the implication of any such duties or promises.14 For these reasons, the Union . asks that the instant Grievance be denied as substantively inarbitrable.

The Merits of the Grievance

Even if the Grievance were to be deemed. a proper subject for arbitration, the Union contends it must be denied on the merits. It submits that· no prOVision of the Standard Agreement requires the Union to endorse the Company's request for an Elevator Constructor Helper's wage determination on federal jobs, to refrain from reporting the Company's violation of DOL regulations to appropriate authorities, or to take any of the actions the Company argues the Union should have taken. Instead, Article IV 'of the Standard Agreement provides that all work specified therein shall be performed by Elevator Constructor Mechanics and Elevator Constructor Helpers. Article X sets out the qualifications and duties of Mechanics and Helpers. Paragraph 6 of Article X specifies the pay rates of Mechanics, Helpers, and Probationary Helpers. By the Union's test, its contractual duty under these agreement provisions is to provide qualified Mechanics and Helpers at the rates established in the Agreement. Because it fulfilled that obligation on both the Henry Homer Homes and CTA Green Line projects, the Union insists it has satisfied its duty under the Standard Agreement.

The Union maintains that the factual premises upon which the Company's position is founded are flawed. First, it insists the Company has !lot proven any damages to date. Even if the Company is subsequently penalized by the DOL for failure to pay Mechanics' wages to Helpers, the Union is convinced any such damages will be the proximate result of the DOL's enforcement of its regulations, and not a product of the Union's actions.

14 The Union argues the existence of a zipper clause like that found in Article XXIII forecloses the claim of an implied duty of good faith and fair dealing under the Agreement.

12

The Union further insists the Company has failed to prove it (the Union) was responsible for the DOL's refusal to recognize the Elevator Constructor Helper classifications after 1993. In this regard, the Union insists the evidence clearly establishes it had nothing to do with the DOL's decision. It asserts the DOL's own documents suggest that denial of the Helper classifications may have resulted from increased scrutiny of the industry and/or from the discovery in 1993 that NEIET was not a registered apprenticeship program. The Union emphasizes further that it has expressed its unhappiness over the impact of the DOL's decision on Helper members and, since the reversal of the pre-1993 DOL policy, has attempted to reverse its effect by endeavoring to establish a registered apprenticeship program that would enable employers to pay Elevator Constructor Helper rates legally.

The Union takes exception to the Company's claim that the DOL did not provide clear notice of its change regarding recognition of helper classifications until well after 1993. It notes that Company President Bailey admitted he failed to read the bid specifications on the Henry Homer Homes and CTA Green Line projects carefully and, for that reason, did not notice that the Elevator Constructor Helper classifications were not included in the wage determinations for the two projects. The Union reasons it can hardly be held responsible for the Company's negligence in not taking notice of that fact. It believes the Company is in fact seeking to shift the blame for its negligence to the Union.

The Union labels as patently false the Company's assertion that had it endorsed the Company's Form 1444 application, the DOL would have approved that application and added the Elevator Constructor Helper classifications to the subject wage determination. It points out that nothing in the relevant regulations requires the DOL to approve a Form 1444 request that has been joined in by the Union. Instead, the DOL has the final say in the matter, regardless of what the parties agree to or disagree about.

Similarly, the Union also claims the April 5, 1996, letter from its Business Manager Weidner complaining about the Company's payment of non-Mechanic's wage rates to Helpers was consistent with its obligations under the Agreement. Weidner testified the reference in that letter to "new classification" was not to the Helper classifications but to the Laborer classification the Company was attempting to establish by paying Elevator Constructor Helpers at the wage rate specified (in the DOL wage determination) for the Laborer classification. That was in flagrant violation of both the wage determination and the Standard Agreement. If successful, the Company's action would have placed the Union in a jurisdictional dispute with the Laborers Union, and would have resulted in Elevator Constructor Helpers being paid less than the Mechanics' wage rate to which the DOL regulations entitled them. The Union submits that having attempted to make an end run around the Standard Agreement and pay Laborers' wages to Elevator Constructor Helpers, the Company is hardly in a position to claim "bad faith" by anyone. Even if the Union were somehow found to have violated the Standard Agreement in this case, it is convinced such violation would have been excused by the unforeseen, supervening actions of the DOL in withdrawing recognition of the Helper classification.

Even if the Union were deemed to have a duty of good faith and fair dealing under the Standard Agreement, it asserts that duty would not take precedence over the duty of fair representation it owes to its members. It urges further that purported duty did not obligate it to sign the Form 1444 requests or to refrain from notifying the DOL of the Company's refusal to pay Helpers at the Mechanics' wage rate. It avers this duty is fiduciary in nature and obliges it to

13

represent employees "adequately as well as honestly and in good faith."15 That duty may include an affirmative obligation to vindicate the statutory rights of its members.16 Finally, the duty of fair representation further requires the Union to avoid "invidious" distinctions.17 In light of its duty of fair representation, the Union reasons it had no alternative but to zealously represent the interests of its members by taking all actions possible to ensure Helpers were paid at the Mechanic's rate to which they were entitled by relevant statute and DOL regulations. It submits any implied obligation to the Company under the Standard Agreement cannot be placed above its fiduciary duty to protect the statutory and other rights of its members. 18

Conclusion

Based on the arguments summarized above, and in the absence of any public policy compelling it to act otherwise, the Union insists it had no statutory, contractual, or other duty to come to the Company's assistance with regard to the DOL's refusal to recognize the Elevator Constructor Helper classifications. Accordingly, it asks that the instant Grievance be denied.

VI. DISCUSSION

Because this dispute centers on a question of contract interpretation, the Company as the moving party must bear the burden of proof. The instant Grievance will be sustained only if the Company is determined to have proven satisfactorily that the Union's actions constituted a breach of the either the Short Form Agreement or the Standard Agreement. Because the Union challenges the substantive arbitrability of the Grievance that threshold issue must be addressed first. The merits of the Company's claim will be decided only if the Grievance is deemed a proper subject for arbitration.

The Substantive Arbitrability Issue

The Union maintains the Grievance is not a proper subject for arbitration under the Article XV Arbitration provision of the Standard Agreement. 19 The key to that assertion is the Company's failure to identify one or more specific Article(s) of the Agreement that it alleges the Union has violated. It is true the Company has not articulated a theory as to how the Union's disputed actions resulted in the violation of any individual, express Article of the Standard Agreement. Instead, the Company contends that the Union's actions amounted to a reputation of the entire wage and effort bargain upon which the Standard Agreement rests.

The Company's claim that by refusing to join its effort to secure DOL approval of the Elevator Constructor Helper classifications for the two subject construction projects the Union has effectively repudiated the wage and effort bargain of the Standard Agreement will be difficult to prove. The same can be said for any contention that an act or omission to act violates an entire contractual agreement, or an implied covenant properly attaching to that

15 Airline Pilots v. O'Neill, 499 U.S. 65, 74-75 (1991). 16 See Goodman v. Lukens Steel Co., 777 Fed. 2d. 113 (3d. Cir. 1985). 17 Steele v. Louisville & Nashville RR. Co., 323 U.S. 192,203 (1994). 18 GTE North, Inc. v. CWA Local 4773, 927 Fed. Supp. 296 (N.D. Ind. 1996). 19 In its post-hearing brief the Company did not address the Union's substantive arbitrability claim.

14

agreement, raised in the absence of a claim that a specific provision of the contract has been abridged. Nevertheless, substantive arbitrability determinations cannot turn in any degree on the probability that the particular claim will succeed. As long as a grievance presents a colorable claim that the underlying collective bargaining agreement has been abridged, that grievance must be deemed a proper subject for arbitration. That is the case here ..

The Arbitrator cannot reject out of hand the Company's argument that the Standard Agreement to which it and the Union became parties by entering into the Short Form Agreement can properly be viewed as embracing an implied covenant of good faith and fair dealing. Whether the Company's argument will prevail is an entirely separate matter. Whatever the merit of that claim, it does concern the terms of, and the mutual intent of the parties underlying the Standard Agreement. Consequently, the undersigned cannot conclude that the instant Grievance raises an issue not within the reach of the Standard Agreement. The Union's substantive arbitrability claim is denied. The analysis below will address the merits of the instant Grievance.

The Merits of the Instant Grievance

As noted above,the Company does not cite to any particular provision of the two Agreements that it contends the Union has violated. Instead, it asserts that the Union's disputed acts and omissions amounted to a repudiation of the wage and effort bargain set out in the Agreements that evidences a breach of the duty of good faith and fair dealing it believes is inherent in them.

The implied covenant of good faith and fair dealing is a product of §205 of the Restatement (Second) of Contracts, which states that "[e]very contract imposes on each party a duty of good faith and fair dealing in its performance and its enforcement. "20 It obligates each, party to a contract to avoid maliciously harming the other, or compromising the other's receipt of the benefit of the contract. There is some authority to support the Company's contention that the parties· to a collective bargaining agreement can properly be charged with a reCiprocal duty of good faith and fair dealing toward one another. That argument is also supported by the statutory duty to bargain in good faith which remains operative during the term of a collective bargaining agreement. .

Whatever the proper rule with regard to applicability of the common law duty of good faith and fair dealing to collective bargaining agreements, it can reasonably be inferred that in agreeing to be governed by the terms of the Standard Agreement the parties mutually contemplated they would both be loyal to the Agreement's provisions and would not attempt to circumvent those terms. Before deciding if the a breach of the covenant of good faith by the Union would warrant sustaining the instant Grievance the Arbitrator must first decide the veracity of the Company's contention that the Union acted in bad faith and attempted to take "opportunistic advantage." To do so the. Arbitrator must first parse the Short Form Agreement and the Standard Agreem6,t in order to ascertain the terms of the wage and effort bargain they memorialize. Following that analysis, the Arbitrator will evaluate the Union's conduct during the period in question and place it within the context of the relevant actions of the Company, the U.S. Congress and the Department of Labor. Each of those two tasks is addressed separately in the text that follows. .

20 RESTATMENT (SECOND) OF CONTRACTS §205 (1981).

15

The Wage and Effort Bargain Reflected in the Short Form Agreement and the Standard Agreement

The Short Form Agreement (Joint Exhibit No.2) serves one primary purpose relevant to the analysis here. Its Paragraph 1 clarifies the parties' mutual intent that theywill "be bound by the terms and conditions of the Standard Agreement" and that "all Elevator Constructor Mechanics and Helpers ... hired by [the Company] are to be are to be employed according to the terms and conditions of [the] Standard Agreement." The more comprehensive Standard Agreement sets out the actual terms of the parties' wage and effort bargain.

The key elements of that bargain relevant here are summarized below.

1. Article IV is the Work Jurisdiction provision. It defines the work to be performed by bargaining unit members and, in Paragraph 1 stipulates that all of that work "shall be performed exclusively by Elevator Constructor Mechanics and Elevator Constructor Helpers in the employ of the [CompanY·J"

2. Article V, Paragraph 1A states ~[t)he rate of wages to b~ paid to Elevator Constructor Mechanics and Helpers shall be determined in accordance with the following wage plans:"[as set forth in the remainder of Article ). Article V goes on to set out formulas for calculating the five-wage rate changes contemplated under the Standard Agreement, including maximum and minimum wage rate change levels. Paragraph 1. D. provides that the wage rate for Elevator Constructor Helpers will be seventy percent of the Elevator Mechanic's wage rate and the wage rate for Probationary Elevator Constructor Helpers will be fifty percent of the Elevator Mechanic's wage rate.

3 .. Article X sets standards for the qualifications of, and the work performed by Helpers. Most significantly, Paragraph 1 states the Union's agreement that "there shall be no restrictions placed on the character of work which a Helper may perform under the direction of a Mechanic." Paragraph 2 sets limits on the number of Helpers that the Company can use. Paragraph 3 establishes that the Company is permitted to use newly hired employees without previous mechanical experience as probationary Helpers for a period of six months (within an aggregate period of nine months).

Viewed as a whole, the relevant terms of the Standard Agreement establish the parties' mutual contemplation that the Company is permitted to use Helpers and Probationary Helpers and is permitted to pay them, respectively, at seventy percent and fifty percent of the Mechanic's wage rate.

, The express terms of the Standard Agreement say nothing about the Union's obligation to

assist the Company when it encounters difficulties in securing approval to use Helpers and/or pay them at the contractually-agreed upon wage rate. However, they do effectively oblige the Union to forego efforts to prevent the Company from using Helpers on projects where their use is otherwise appropriate. Therefore, in order to satisfactorily prove that the Union acted improperly the Company must establish that it acted in a manner intended to prevent the Company from using the Helper classifications and paying them at the contractually agreed

16

upon wage levels when it was otherwise entitled t·, do so. In the analysis below the circumstances at issue will be evaluated to determine i :l1e Company has met that burden of proof.

Did the Union Take "Opportunistic Advantage?"

The crux of the Company's claim is the assert-- that the Union improperly took "opportunistic advantage" of the circumstances attendant ~., the change in DOL's position as to the use of the Elevator Construdor Helper classificatlor. on federal and federally financed construction projects. It insists the Union's acts and omlss:. ':S amounted to an attempt to deny the Company the benefit of the bargain struck in the Stanc;;:d Agreement as to the use of, and wage rates to be paid the Helper classifications. Detem':1ation of the merits of this claim require the Arbitrator to briefly recap and clarify the most s.;:~ificant of the events which led to the predicament the Company now finds itself in with rega,::' to the Henry Horner Homes and CTA Green Line projects.

The key facts are these.

1. For a number of years prior to 1993 the Wage anc. Hour Division of the DOL routinely included the Elevator Constructor Helper classifications in wage determinations for federal and federally funded cC'1struction projects issued pursuant to the Davis-Bacon Act. For a brief ::;sriod of time (between December 4, 1990, and April 10, 1991, and agair ::>etween November 26, 1991, and October 21, 1993) recognition of the Ele ator Constructor Helper classifications resulted from the express, general .c;anction of the use of "helpers" in relevant DOL regulations. At other tim:::;, the Inclusion of the Elevator Constructor Helper classifications resulted fr:: m the Wage and Hour Division's application of a longstanding policy per--'itting the addition of helpers to wage determinations if certain conditions addressed below) are met.

2. Section 104 of the Fiscal Year 1994 Appropriatio,s Act for the DOL expressly prohibited the expenditure' of DOL funas to implement or administer the regulations which had resulted in the short term, intermittent inclusion of "helper" classifications in Davis-Bacon ,L,ct \l/age determinations during the years from 1990-93. As a result of the legisI2:ion, the Wage and Hour Division provided notice to federal contractors, via t, ie Federal Register, a Notice entitled "Prohibition on Use of Survey Wage Date:, for Helpers, ,,21 and through Agency Memorandum No. 174 (issued Decembe" 2, 1993) that the then-existing regulations generally sanctioning inclL:sion of "helper" classifications in Davis-Bacon Act wage determinations were suspended, effective October 21, 1993. ,

3. The key passages from Agency Memorandum No. 174 state as below.

Contractors and subcontractors may not employ "helpe~s" as that term was defined in ... the suspended regulations on a'1y Davis-

21 The date of this notice is not clear on its face. If it is the "notice" referred to in All Agency Memorandum No. 174, it was dated November 5, 1993.

Bacon covered contract awarded on or after October 21, 1993. Semi-skilled helper classifications and wage rates that were issued in wage determinations pursuant to the suspended regulations and that have been included in contracts awarded on or after October 21, 1993, are not valid. Moreover, the regulatory provision that allowed the consideration of additional classification actions for helpers is suspended; therefore, the Department will not consider any additional classification requests that would permit the use of helpers as defined in the suspended regulations on such contracts.

In accordance with its prior practice, the Department will, however, recognize helper classifications that are [i] separate and distinct classes of workers performing duties distinguished from those of journey-level workers or other classifications listed on the wage determination; [ii] whose use prevails in an area; and [iii] who are not employed in an informal apprenticeship or training capacity.

Helpers may be employed on contracts awarded after October 21, 1993, only if a definition of the helper's duties establishing the helper as a separate and distinct classification is set forth in the wage determination or on the additional approval documents. (emphasis supplied)

4. The Company bid upon and secured the elevator construction work on the Henry Homer Homes project and the CTA Green Line project without contemplating that it would not be permitted to pay reduced wages (per the Standard Agreement) to employees 'in the Elevator Constructor Helper classifications. Company President Robert R. Bailey III testified that he had not been told that the DOL had changed its policy regarding recognition of the Elevator Constructor Helper classifications.

5. When the Company became aware that the wage determinations for the CTA Green Line and Henry Homer Homes projects did not include the Elevator Constructor Helper classifications, it sought to enlist the Union's joinder in the two Form 1444 Requests for Authorization of Additional Classification and Rate it filed with the appropriate local federal officials. The Form 1444 Request for the CTA Green Line project (Company Exhibit No. 11) is dated September 30, 1996. The Form 1444 Request for the Henry Homer Homes project (Company Exhibit No.5) is dated January 17, 1997. The Union did not sign either Form 1444.

6. On February 12, 1997, the Form 1444 Request for the Henry Homer Homes project was forwarded to the Administrator of the Wage and Hour Division of DOL in Washington, D.C. (Company Exhibit No.7) for a final decision. In

17

18

forwarding the Company's Request to DOL, the local official of the U.S. Department of Housing and Urban Development, Labor Specialist Philip J. Poirier, opined that the proposal was "not consistent with DOL practice with respect to Helpers and Probationary Helpers." (Union Exhibit No. 13)

7. In a letter dated March 13, 1997, (Company Exhibit No.8) DOL Construction Wage Determinations Section Chief Terry Sullivan declined to approve the Company's Request for addition of the Elevator Constructor Helper and Probationary Elevator Constructor Helper classifications. Citing to relevant DOL regulations pertaining to the addition of classifications and wage rates in conformance with the wage determination in a Davis-Bacon Act covered contract, the letter states in relevant part:

Helper classifications may be added to a wage determination only where (a) the duties of helpers are clearly defined and distinct from those of the journeyman classification and from the laborer, (b) the use of such helpers is an established prevailing practice in the area, and (c) the term "helper" is not synonymous with "trainee" in an informal training program. No information has been submitted to suggest that these tests are met with regard to the helper classification proposed in ·the case. (emphasis supplied)

8. The Company requested reconsideration of the March 13, 1997, denial of its Form 1444 Request pertaining to the Elevator Constructor Helper and Probationary Elevator Constructor Helper classifications. In a letter dated August 13, 1997, (Union Exhibit No. 21), DOL Wage and Hour Division National Office Program Administrator Corlis L. Sellers reaffirmed the earlier decision to deny the Request. The letter retraces the chronology of the Department's change of position with regard to helpers [as summarized previously in this Award], and notes that during the suspension of the pre-1993 helper regulations, helper classifications are being issued in [Davis­Bacon Act] wage determinations based on the "pre-existing longstanding policy" for the inclusion of "helper" classifications in wage determinations. The three elements of the test for helper wage determinations (as cited in the March 13, 1997, denial of the Company's Request) were then recounted. Administrator Sellers' letter went on to state in relevant part as follows.

As suggested by the contractor in this case, prior to . implementation of the helper regulations, the Department of Labor issued and approved the addition of the union-negotiated helper and probationary helper classifications, along with the elevator constructor mechanic classification for use on projects to which the Davis-Bacon labor standards applied. However, that practice was reviewed, and it has been discontinued.

[After analyzing what she deemed to be the relevant provisions of the Standard Agreement, the Administrator went on to say as follows] There is no evidence in the Agreement that the duties of

the helpers are clearly defined and distinct from those of the mechanic. Thus, available evidence indicates that the first test, cited above, for approval of the helper classifications has not been met.

In construction contracts to which the labor standards of the Davis-Bacon and related Acts apply, apprentices or trainees (by whatever name) are permitted to work at a rate less than that specified in the wage determination when they are employed pursuant to and individually registered in a program approved by the appropriate Federal or State agency. Employees not so registered must be paid at no less than the classification of work actually performed. (See Regulations, 29 CFR Part 5, section 5.5(a}(4).)

Insofar as the elevator industry educational program to which the Standard Agreement alludes has not been approved by the Bureau of Apprenticeship and Training or an appropriate State agency, the helpers requested for this contract who participate in that program appear to be trainees in an informal training program. Thus, the third test of the above-stated policy concerning the conformance of helper classification has not been met. (emphasis supplied)

9. The Company appealed Administrator Sellers's decision to the DOL Administrative Review Board. The· Acting Administrator's Response to Petition for Review, dated October 28, 1997, (Union Exhibit No. 26) affirmed the August 13, 1997, ruling of the Wage and Hour Division. In recapping the significant dimensions of that ruling, the Board noted the three "preexisting longstanding criteria for the addition of a helper classification and summarized the manner in which application of the three-step test by Administrator Sellers of the Wage and Hour Division had lead to the decision to reaffirm the earlier denial of the Company's Request. Most significantly, the Acting Administrator's Response went on to observe (in a footnote) "[t]he Petitioner is correct is correct that historically the use of elevator constructor helpers had been approved on Davis-Bacon projects. Those decisions were issued without application of the correct criteria, but that practice has been discontinued.

In sum, the Board's Decision to reject the Company's Petition resulted from its determination that the first and third criteria for addition of a helper classification were not satisfied. In applying the first criteria, the Board spoke to the effect of Article X, Paragraph 1. of the Standard Agreement. In that regard it stated as below.

. . . the Agreement . . . provides at Article X, Par. 1. that 'there shall be no restrictions placed on the character of work which a Helper may perform under the direction of a Mechanic.' Petitioner obviously agrees with this when it states mechanics 'are free to

19

20

delegate whatever duties they see fit to helpers .... '" [citation omitted] This means that at any time helpers and mechanics are working together they may be performing the same duties. Therefore there is no way they can be considered to have distinct duties, and he first requirement for the helper classification has· not been satisfied.

Turning to the third criterion of the three-part test the Board stated:

The Petitioner has also failed to show that the helpers for which it seeks a classification on the wage determination are, as found by Wage and Hour, engaged in nothing more than an informal training program. [sic] Given its failure to meet the first criterion for adding a helper classification to the wage determination, the only other independent basis permitting such workers to be paid rates lower than those of the journeymen would be their registration in approved apprenticeship or training programs. It is the Petitioner's burden to show that the helpers are registered with the Bureau of Apprenticeship and Training' in an approved apprenticeship or trainee program pursuant to h29 C.F.R. 5.5(a)(4). [citations omitted] Petitioner has presented no such evidence in the instant proceeding in support of its Petition.

The Arbitrators exhaustive review of the relevant facts reveals the true cause of the Company's predicament to be the action of Congress in effectively barring the DOL from continuing to implement the regulations it first promulgated in 1990 which established a general policy of approving the use of helper classifications on federal and federally-funded construction projects. As a result of the repeated directives from Congress in DOL appropriations bills, the Department has been obliged to return to its preexisting, longstanding policy whereby helper classifications were approved, not as a matter of routine, but only where the three criteria for recognition of helper classifications have been satisfied.

As pointed out by the Administrative Review Board in its October 28, 1997, Response to the Company's Petition for Review of the decision of the Wage and Hour Division, the Department's prior approval of the Elevator Helper classifications on Davis­Bacon Act projects had been made without application of the three criteria. The Company's problems arose as a result of the Department's decision to discontinue that practice and instead resort to the three step test in deciding whether to include the Elevator Constructor Helper classifications in Davis-Bacon Act wage determinations.22

22 In adopting this position in affirming the Augll,t 13, 1997, ruling of the Wage and Hour Division with regard to the Company's Form 1444 Request for the Henry Horner Homes project, the Administrative Review Board placed no reliance on the 1986 Decision of the former DOL Wage Appeals Board in Hawk View Apartments, WAB Case No. 85-20 (April 24, 1986). Therefore, the Arbitrator must conclude the 1993 change in DOL's general position on the use of helper classifications and its subsequent change in position regarding the Elevator Constructor Helper classifications effectively subsumed that WAB Decision and whatever rule it may have established regarding recognition of negotiated helper classifications.

Application of the three-step resulted in DOL officials repeatedly determining that its criterion 1 and criterion 3 are not satisfied. for the Elevator Constructor Helper classifications. The fact that Elevator Constructor Helpers perform most of the job duties that Elevator Constructor Mechanics perform, and the absence of an approved apprenticeship or training program in the elevator construction industry effectively doom any effort by an employer in the Company's position to secure approval of a Form 1444 Request for addition of Helper classifications to the Davis-Bacon Act wage determinations for federal and federally funded construction projects. The Company's arguments in this case overlook this reality and instead attempt to lay the responsibility for the predicament it now finds itself in with regard to the CTA Green Line and the Henry Horner Homes projects at the Union's feet. That effort is misdirected.

The Company has failed to adduce any reliable proof that the DOL's change in position with regard to the propriety of the use of Elevator Constructor Helper classifications on Davis-Bacon Act construction projects resulted from the Union's efforts. Its attempt to characterize the April 5, 1996, letter from Local Union No. 2 Business Manger Edward Weidner to DOL official Pamela Beavers (Company Exhibit No.9) as untoward and a significant factor in the DOL's eventual decision to deny its Form 1444 Request is not well taken. The weight of the evidence in the record, including the cross-examination testimony of Company President Bailey, indicate the subject letter was triggered by the Company's short-term practice of paying Elevator Constructor Helpers at the wage rate specified '(in the relevant Davis-Bacon Act wage determination) for the Laborer classification. The letter does not constitute proof that the Union was attempting to evade the wage and effort bargain reflected in the Standard Agreement. Nor does it prove that the Union attempted to persuade the DOL to reject the Company's Form 1444 Requests at issue here.

It is true that the Union remained passive when the Company wanted it to join in what was from the start a futile effort to secure approval of Form 1444 Requests for addition of the Elevator Constructor Helper classifications to the wage determinations for the CTA Green Line and the Henry Horner Homes projects. That the Company was disappOinted by the Union's refusal to join in the effort to ameliorate the problems caused by its lack of knowledge as to the DOl's change of position regarding the Elevator Constructor Helper classifications is understandable. Nevertheless, even assuming arguendo, that the Union had an implied duty of good faith and fair dealing under the Standard Agreement that obliged it to refrain from attempting to undermine the terms of that Agreement, the Company has adduced no real evidence to suggest the Union breached that duty.

Each of the major premises on which the Company's claim rests is unsupported by the evidence. First, the DOL's repeated and consistent rulings with regard to the Company's Form 1444 request for the addition of the Elevator Constructor Helper classifications belies the Company's claim that the DO!_ would likely have approved the Request if the Union had joined in them. Second, the evidence clearly shows that the DOL changed its general position regarding helper classifications in October 1993. Therefore, the Company's assertion that the DOL did not change its position regarding helpers in 1993 must be rejected as unproven. It is true that the Notice issued by DOL (Union Exhibit No .. 12) and Agency Memorandum No. 174 (Union Exhibit No. 25) did not expressly address the Elevator Constructor Helper classifications and did not definitively state that Davis-Bacon Act wage determinations would no longer include

21

22

these classifications. However, the fact remains that the change in position that eventually lead to the Department's decision to cease recognizing the Elevator Constructor Helper classifications was demarcated from late 1993, nearly two years before the events at issue here arose.

The Company was perhaps justified in inferring that the change in DOL's general policy toward helpers did not definitively establish that the Elevator Constructor Helper classifications would no longer be recognized. The Department's eventual decision to not approve those classifications did reverse its long-term practice to the opposite effect. Regardless, as a long time contractor on federal and federally funded construction projects, the Company can be charged with at least constructive knowledge that change was occurring in DOL policy towards helper classifications in general. Once that change resulted in DOL no longer including the Elevator Constructor Helper classifications in Davis-Bacon Act wage determinations, it was the Company's responsibility to take notice of that change and to fashion its bids accordingly. More importantly, the evidence indicates that once the decision to cease recognition of the Elevator Constructor Helper classifications was made by DOL there was nothing that could be done to persuade the Department to act otherwise. For this reason, the claim central to the Company's contention that the Union took opportunistic 'advantage of the circumstances created by the change in DOL policy and the Company's lack of knowledge of that change-to wit: that its Form 1444 Requests would have been approved by the DOL if the Union had joined in those Requests-must be rejected as unproven.

Conclusion

Based on the analysis and findings set forth above, the Arbitrator can only conclude that the Company has failed to prove that the Union acted in a manner intended to prevent the Company from exercising its contractually-granted right to use the Elevator Constructor Helper classifications and pay them at the contractually-specified wage levels when it was otherwise entitled to do so. The' bargain between the parties pertaining to the Elevator Constructor Helper classifications was effectively mooted with regard to the CTA Green Line and Henry Homer Homes projects because the DOL will not recognize those classifications unless all three elements of the general test for approval of helper classifications are met. Because the DOL. has definitively determined that criterion 1 and criterion 3 of that test are not satisfied for the Elevator Constructor Helper classifications the wage and effort bargain reflected in the Standard Agreement is moot for federal and federally funded construction projects of the type at issue here.

The Company has failed to prove that the Union violated any of the express terms of, or any the express or implied duties arising under, the Short Form Agreement and/or the Standard Agreement. The Award below is framed in a manner consistent with that conclusion.

The Section 8(b){3) Unfair Labor Practice Matter

The Arbitrator has determined the Company failed to prove a violation of any of the express or implied terms of either the Short Form Agreement or the Standard Agreement. Therefore, he is obliged to conclude that the record contains no probative evidence to establish that the Union's disputed acts or omissions resulted in a refusal or

failure to bargain collectively in good faith as proscribed by Section 8(b)(3) of the LMRA. The Award below is framed in a manner consistent with that conclusion.

VII. AWARD

The Company has failed to prove a violation of the terms of, or any the express or implied duties arising under, the Short Agreement and/or the Standard Agreement. Accordingly, the instant Griev n nied."1

March 2, 1998 Bloomington, Indiana

23