United Steelworkers v. Rohm & Haas Co ( 2008 )

Opinions of the United
2008 Decisions States Court of Appeals
for the Third Circuit
4-14-2008
United Steelworkers v. Rohm & Haas Co
Precedential or Non-Precedential: Precedential
Docket No. 06-4346
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PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 06-4346
UNITED STEELWORKERS OF AMERICA, AFL-CIO-
CLC, ET AL.,
Appellees,
v.
ROHM AND HAAS COMPANY and
ROHM AND HAAS HEALTH AND WELFARE PLAN,
Appellants.
On Appeal from the Judgment of the United States District
Court
for the Eastern District of Pennsylvania
(Civ. No. 05-0039)
District Judge: Honorable J. Curtis Joyner
Argued: February 4, 2008
Before: McKEE, AMBRO, Circuit Judges, and IRENAS,*
Senior District Judge.
(Filed April 14, 2008 )
Raymond A. Kresge, Esq. (Argued)
Cozen O’Connor
1900 Market Street
Philadelphia, PA 19103
Counsel for Appellants
William Payne, Esq. (Argued)
Stember, Feinstein, Doyle & Payne
1007 Mt. Royal Blvd.
Pittsburgh, PA 15223
Pamina Ewing, Esq.
Stember, Feinstein, Doyle & Payne
1705 Allegheny Building
429 Forbes Avenue
Pittsburgh, PA 15219
*
Honorable Joseph E. Irenas, Senior United States District
Judge for the District of New Jersey, sitting by designation.
2
Counsel for Appellees
_____________
OPINION
_____________
IRENAS, Senior United States District Judge.
In this case we are asked to review a determination by the
District Court that an employee’s challenge to a denial of
disability benefits under a plan adopted by an employer pursuant
to the Employee Retirement Income Security Act (“ERISA”), 29
U.S.C. § 1001 et seq., is subject to the grievance procedure,
including arbitration, contained in a separate collective
bargaining agreement (the “CBA”) negotiated between the
employer and its workers under the National Labor Relations
Act, 29 U.S.C. § 151 et seq. While we recognize the strong
policy considerations favoring arbitration of labor disputes,
there is no right to arbitration of ERISA benefits under a CBA
3
unless the ERISA benefits sought are either: (i) derived directly
from an ERISA plan established and maintained by or
incorporated into a CBA whose grievance procedure contains an
arbitration clause, or (ii) created by a separate ERISA plan and
that plan and/or the CBA provide that adverse benefit
determinations by a plan administrator are subject to the CBA’s
grievance procedure that includes arbitration. Because we hold
that the benefits sought in this case are neither created by or
incorporated into the CBA nor made subject to the CBA’s
grievance procedure, we reverse the District Court’s order
granting summary judgment to the union and those workers
seeking disability benefits and denying summary judgment to
the employer. We remand for further proceedings on the
remaining claim consistent with this opinion.
I.
4
Plaintiffs-Appellees United Steelworkers of America,
AFL-CIO-CLC (the “Union”), Lewis Griffin, George Hemmert,
George Keddie, and Janice Scott (the “Individual Plaintiffs”),
filed a two count complaint in the Eastern District of
Pennsylvania against Defendants-Appellants Rohm and Haas
Company (the “Company”) and Rohm and Haas Company
Health and Welfare Plan (the “Plan”). The Individual Plaintiffs
are employees at the Company’s Bristol, Pennsylvania facility
and members of the Union, which represents the hourly
production and mechanical employees at this facility. Count I
of the Complaint sought to compel arbitration of four grievances
filed by the Individual Plaintiffs to challenge the denial of
disability benefits under the Plan, pursuant to the CBA between
the Company and the Union covering the Bristol facility (the
5
“Bristol CBA”).1 Count II, in the alternative, alleged violations
of Section 502 of ERISA, 29 U.S.C. § 1132 (a)(1)(B) and (a)(3).
At the inception of the case, the District Court ordered that the
two counts be litigated separately and that discovery proceed
initially on Count I only. Upon the filing of the parties’ cross-
motions for summary judgment as to Count I only, the District
Court granted the Plaintiffs’ motion for summary judgment and
denied the Defendants’ motion for summary judgment, thus
disposing of the case and rendering Count II of the Complaint
moot. The Company and the Plan now appeal the District
Court’s decision in its entirety.
A.
1
Subject matter jurisdiction on Count I is premised on
Section 301 of the Labor Management Relations Act, 29
U.S.C. § 185.
6
Each of the four Individual Plaintiffs sought to obtain
either disability retirement or long term disability benefits from
the Plan, and these benefits were denied by the Plan
administrator. Following these denials, the Union submitted
grievances pursuant to the Bristol CBA on behalf of the four
Individual Plaintiffs, to which the Company failed to respond.
The grievances of the four Individual Plaintiffs were filed
between August 27, 2003 and October 8, 2004. The Union
contends that each of the Individual Plaintiffs fully exhausted
the grievance procedures or that any additional attempts to
exhaust such procedures would have been futile. The Union
demanded that these grievances be arbitrated in accordance with
the Bristol CBA; however, the Company refused to arbitrate
these grievances, arguing that any challenge to a denial of
benefits under the Plan had to be made pursuant to the appeal
procedure contained in the Plan itself.
7
On January 6, 2003, prior to the filing of the grievances
on behalf of the four Individual Plaintiffs, the Union filed a site-
wide grievance pursuant to the Bristol CBA (the “Site-Wide
Grievance”) complaining that the “disability case management
process” resulted in the termination or denial of disability
benefits in a manner inconsistent with the Plan.2 The Company
has never responded to the Site-Wide Grievance, and the Union
has never demanded arbitration of this grievance.
2
The Site-Wide Grievance states:
The Union is grieving the disability case management process. Liberty
Mutual and Rohm and Haas have been engaged in a process that is clearly
arbitrary and inconsistent with the provisions of the disability benefits
program. Liberty Mutual and Rohm and Haas have denied disability benefits
and terminated disability benefits without cause and in a manner inconsistent
with the plan provisions. The Union wants to be made whole. Made whole
includes, but is not limited [sic], administration of the plan as stipulated in the
benefits [Summary Plan Description] dated June 1994, all current and past
bargaining unit members to be made whole for all moneys and benefits lost,
in addition to reimbursement for all costs resulting from the processing of any
and all appeals of disability benefits denials.
8
B.
“Article II - Recognition” of the Bristol CBA, effective
May 8, 2000 to May 7, 2004,3 provides that “[t]he provisions of
this Agreement hereafter pertain only to the wages, hours, and
working conditions of the . . . employees.” Article V then
establishes a five-step grievance procedure covering “[s]uch
questions arising under this Agreement as involve wages (other
than general adjustments), individual base rates, hours of
employment and working conditions which any employee may
desire to discuss with the Company.” The final step of the
3
Although the production unit and the mechanical unit
maintained separate collective bargaining agreements, the
terms in the collective bargaining agreements relevant to this
action are identical and are thus analyzed as if they were one
agreement.
9
grievance procedure states: “Should agreement not be reached
[during the previous steps] . . . then either party may submit the
matter to arbitration as described in Article VI.”
Article VI on Arbitration provides that “[t]he sole
responsibility of said arbitrator shall be to interpret the meaning
of the Articles of this contract, and it in no way shall be
construed that the arbitrator shall have the power to add to,
subtract from, or modify in any way the terms of this
Agreement.”
The Bristol CBA also contains an Article addressing the
medical examinations of Union members:
ARTICLE XIX - MEDICAL EXAMINATIONS
1. All new employees must pass a Company medical
examination.
2. Company medical examinations of employees or
groups of employees shall be made from time to time. Should
any examination disclose that a transfer to another department
would be beneficial from a health standpoint, the employee will
10
be consulted and the transfer considered. A transfer for this
reason shall be with the concurrence of the Company and the
Union and shall not be held in violation of the seniority
provisions. Such exceptions are subject to periodic medical
examinations.
3. Before any employee’s status is changed due to
physical incapacity, he shall be entitled to a medical
examination by an impartial physician should there be
disagreement between the Company physician and the
employee’s personal physician. When the Company physician
and the employee’s personal physician disagree, and prior to the
receipt of an impartial physician’s opinion, the employee will be
placed on disability absence and be provided benefits under the
provisions of the Sickness and Accident plan, provided no
suitable reassignment is available. It shall be the Company’s
and the Union’s goal to have such situations resolved as soon as
possible.
4. When an employee feels he needs a medical
examination, he will receive same upon a written request to the
Labor Relations Manager. An employee’s physician may obtain
from the Plant physician a written statement of medical findings.
5. Should it be determined by a medical examination that
an employee is no longer able to do his regular work, then this
employee shall be eligible for such other regular work that may
be available and which he can perform satisfactorily. It in no
way is understood that the Company must provide such work.
Said employee shall receive the rate of the job to which he is
transferred but may be eligible for wage rate protection as
provided for under the provisions of the Disability Rate
11
Protection Policy.4
With the exception of the mention of the “Sickness and
Accident plan” in Article XIX (3), the Bristol CBA does not
contain any other reference to disability benefits.
The Plan, as amended and restated effective January 1,
2003, provides for disability income benefits5 and other benefits
for eligible employees of the Company, including non-union
employees, and is not limited to Company locations covered by
the Bristol CBA. The Plan is governed by ERISA and exists
4
While the parties have not explained the term “Disability
Rate Protection Policy,” it does not appear to be a “disability
benefit” provided under the Plan.
5
“Disability Benefit” is defined as “a benefit provided
under a Benefits Program (including, but not limited to,
benefits provided by the Long-Term Disability Program) as a
result of the disability of a Claimant. The terms and
provisions, and conditions of eligibility thereto, are set forth
in the Applicable Contract and Summary Plan Description for
such benefit.”
12
outside of and is independent from the Bristol CBA. The Union
is not a signatory to the Plan, and there is no reference to the
Bristol CBA or the Union throughout the Plan.
The Plan vests the Rohm and Haas Benefits
Administrative Committee with “the sole discretion to interpret
the Plan and decide any matters arising hereunder” and states
that “[a]ny final determination by the Rohm and Haas Benefits
Administrative Committee shall be binding on all parties.” Final
determinations by the Rohm and Haas Benefits Administrative
Committee “shall not be subject to de novo review and shall not
be overturned unless proven to be arbitrary and capricious . . . .”
The Plan establishes a detailed claims procedure by
which an employee may seek to claim benefits and to appeal a
denial of benefits. The claims procedure provides:
Any claim for Benefits under any of the Benefit
Programs shall be made in accordance with the procedures as set
13
forth in the Applicable Contracts 6 or Summary Plan Description
and in accordance with the procedure set forth below. Should
there be a conflict between the procedures set forth in any
Applicable Contract or Summary Plan Description and the
procedures set forth below, the procedures set forth below shall
control.
Pursuant to the claims procedure, a claimant seeking
benefits under the Plan initially files a claim with the Claims
Administrator. If a claimant receives an adverse benefit
determination, he may then file an appeal with the Appeals
Administrator, who is vested with final determination of adverse
disability claims. The Plan requires the final notice of an
adverse benefit determination to include “a statement of the
Claimant’s right to bring an action under section 502(a) [29
6
An “Applicable Contract” is defined as “any contract,
agreement or other similar document pursuant to which
Benefits are provided under a Benefit program. The terms of
any such Applicable Contract, as in effect from time to time,
are hereby incorporated into the Plan and each applicable
Benefit Program.”
14
U.S.C. § 1132(a)] of ERISA . . . .” The Plan further provides
that any claimant seeking to file a lawsuit must do so within
ninety days of receipt of the adverse benefit determination or the
commencement of the action will be barred. The Plan does not
provide for arbitration at any step of the claims procedure.
C.
Upon examining these documents, the District Court
found that the relevant provisions created an ambiguity as to
whether the Individual Plaintiffs’ grievances were subject to
arbitration under the Bristol CBA. The District Court then
looked to the summaries of the collective bargaining
negotiations for evidence of the parties’ intent, and found that,
because disability benefits were the subject of negotiations
between the Union and the Company over the past forty years,
such benefits were encompassed under the agreement as
15
“wages” and “working conditions.” Despite the fact that the
Bristol CBA did not reference the Plan or provide any details
regarding disability benefits, the District Court held that
sufficient extrinsic evidence existed to show that the parties
intended to incorporate the Plan into the Bristol CBA.
II.
Our Court has plenary review over the District Court’s
order granting summary judgment as a matter of law.7 Local
7
The Plaintiffs argue that, to the extent that this Court is
reviewing the District Court’s factual determination of the
parties’ intent to arbitrate, the standard of review is clearly
erroneous. See Lukens Steel Co. v. United Steelworkers, 989
F.2d 668, 672 (3d Cir. 1993) (“The proper standard of review
has to be whether the district court’s findings - interpretation
of the contract, that is, the intent of the parties as to the
meaning of the contract’s language - are clearly erroneous.”
(quoting John F. Harkins Co. v. Waldinger Corp., 796 F.2d
657, 660 (3d Cir. 1990))). Because we do not find the
16
827, Int’l Bhd. of Elec. Workers v. Verizon N.J., Inc., 458 F.3d
305, 309 (3d Cir. 2006) [hereinafter Verizon]; see also Harris v.
Green Tea Financial Corp., 183 F.3d 173, 176 (3d Cir. 1999)
(holding standard of review is plenary where appeal “presents
a legal question concerning the applicability and scope of an
arbitration agreement”).
We first recognize the strong federal policies that favor
arbitration of labor disputes, which are largely premised upon
the “arbitrator’s superior expertise in the mechanics of collective
relevant documents ambiguous with respect to the issues
before us, it is not necessary to consider the District Court’s
factual findings with respect to the parties’ intent. See, e.g.,
Reliance Ins. Co. v. Colonial Penn Franklin Ins. Co. (In re
Montgomery Ward & Co.), 428 F.3d 154, 165 (3d Cir. 2005)
(holding that the lower courts erred in reviewing extrinsic
evidence of the parties’ intent where the contract was not
ambiguous). See also Teamsters Indus. Employees Welfare
Fund v. Rolls-Royce Motor Cars, Inc., 989 F.2d 132, 135 (3d
Cir. 1993) (“The determination of whether a contract term is
clear or ambiguous is a pure question of law requiring plenary
review.”).
17
bargaining and collective bargaining agreements, greater
understanding of the law of the shop, and greater efficiency in
resolving labor disputes.” Laborers’ Int’l Union v. Foster
Wheeler Corp., 26 F.3d 375, 399 (3d Cir. 1994). The key
principles governing whether a dispute is arbitrable are well
established:
First, “arbitration is a matter of contract and a party cannot be
required to submit to arbitration any dispute which he has not
agreed so to submit.” Second, “in deciding whether the parties
have agreed to submit a particular grievance to arbitration, a
court is not to rule on the potential merits of the underlying
claims.” Third, “where the contract contains an arbitration
clause, there is a presumption of arbitrability in the sense that,
‘an order to arbitrate the particular grievance should not be
denied unless it may be said with positive assurance that the
arbitration clause is not susceptible of an interpretation that
covers the asserted dispute. Doubts should be resolved in favor
of coverage.’”
Lukens Steel Co. v. United Steelworkers, 989 F.2d 668, 672-73
(3d Cir. 1993) (quoting AT&T Techs., Inc. v. Commc’ns
Workers of Am., 475 U.S. 643, 648 (1986)) (internal citations
18
omitted). Where parties have agreed to submit all questions of
the interpretation of a collective bargaining agreement to an
arbitrator, the court “is confined to ascertaining whether the
party seeking arbitration is making a claim which on its face is
governed by the contract.” United Steelworkers v. American
Mfg. Co., 363 U.S. 564, 567-58 (1960). Our Circuit has
articulated three questions to consider when assessing whether
a dispute is arbitrable: “(1) Does the present dispute come
within the scope of the arbitration clause?[;] (2) does any other
provision of the contract expressly exclude this kind of dispute
from arbitration?[;] and (3) is there any other ‘forceful evidence’
indicating that the parties intended such an exclusion?” E.M.
Diagnostic Sys., Inc. v. Local 169, Int’l Bhd. of Teamsters, 812
F.2d 91, 95 (3d Cir. 1987).
19
A.
The parties devote much of their briefing to the issue of
whether the arbitration clause is narrow or broad, and
consequently whether the presumption of arbitrability arises.
Relying on Verizon and Trap Rock Industries, Inc. v. Local 825,
International Union of Operating Engineers, 982 F.2d 884 (3d
Cir. 1992) [hereinafter “Trap Rock”], the Company and the Plan
argue that the presumption of arbitrability only applies where the
arbitration clause is broad, and thus does not apply where the
arbitration clause is narrow.
Cases holding that the arbitration clauses at issue are
narrow have generally relied on language expressly limiting the
scope of the clause to specific subject matter. For example,
because the arbitration clause in Verizon specifically enumerated
certain articles within the collective bargaining agreement that
were subject to arbitration, the court held that the arbitration
20
provision was narrow as it “clearly forecloses the possibility that
other issues could be arbitrated by providing that the list is
exclusive.” 458 F.3d at 307, 311-12. Likewise, the Trap Rock
court held that an arbitration clause was narrow where the
employer reserved its right to determine its employees’
qualifications and discharge or demote its employees based on
such qualifications and also expressly excluded the right of the
arbitrator to make such determinations. Trap Rock, 982 F.2d at
888.
We do not believe that the arbitration clause here
explicitly forecloses the range of arbitrable subject matter.
Although the arbitration clause limits the arbitrator’s power to
interpreting the articles of the Bristol CBA, such a limitation on
power is not an exclusion from arbitration of subject matter that
is addressed in the Bristol CBA. Further, while the terms of the
Bristol CBA and its grievance procedure apply to wages, hours,
21
and working conditions, such terms are themselves fairly
expansive and encompass a variety of types of claims within
their definitions. Read in its entirety, the Bristol CBA neither
specifically excludes nor provides evidence of a purpose or
intent to exclude categories of grievances from arbitration.
As such, the arbitration clause here is more akin to those
arbitration clauses held to be broad. See, e.g., Lukens Steel, 989
F.2d at 673 (3d Cir. 1992) (holding that an arbitration provision
was broad where it called for arbitration “[s]hould any
differences arise as to the meaning and application of, or
compliance with, the provisions of this Agreement” and further
noting that the parties’ express exclusion of other categories of
subject matter from the arbitration clause indicated that the
parties knew how to limit the categories of arbitrable subject
matter); E.M. Diagnostic Sys., Inc., 812 F.2d at 92 (clause was
broad where it called for arbitration of “any dispute arising out
22
of a claimed violation of this Agreement”). Because there is
neither an express provision excluding issues concerning
disability benefits from arbitration nor forceful evidence of a
purpose to exclude such benefits from the Bristol CBA’s
grievance procedure, we hold that the arbitration clause is broad
and thus the presumption of arbitrability applies.
B.
Regardless of whether the arbitration clause is broad or
narrow, however, arbitration is still a creature of contract and a
court cannot call for arbitration of matters outside of the scope
of the arbitration clause. See AT&T Techs., Inc., 475 U.S. at 656
(“‘[W]hether or not the company was bound to arbitrate, as well
as what issues it must arbitrate, is a matter to be determined by
the Court on the basis of the contract entered into by the
23
parties.’” (quoting John Wiley & Sons, Inc. v. Livingston, 376
U.S. 543, 547 (1964))); E.M. Diagnostic Sys., Inc., 812 F.2d at
94-95.
Here, the scope of the Bristol CBA’s grievance procedure
is limited to “[s]uch questions arising under this Agreement as
involve wages (other than general adjustments), individual base
rates, hours of employment and working conditions which any
employee may desire to discuss with the Company shall be
subject to adjustment.” Although we hold that the Bristol
CBA’s arbitration clause is broad, the underlying basis for the
grievance submitted through the Bristol CBA grievance
procedure must still arise from some specific article of the
Bristol CBA. The Bristol CBA does not, however, have an
article devoted to disability benefits nor does it provide any sort
of discussion as to the employees’ rights to or calculations
regarding such benefits. Because there is no specific language
24
addressing the employees’ rights to disability benefits, we
cannot say that such benefits were provided for under the terms
of the Bristol CBA.
The Union and the Individual Plaintiffs present two
possible arguments for their claim that disability benefits may be
the subject of the grievance procedure and thus arbitrable. First,
the Union and the Individual Plaintiffs contend that disability
benefits are considered “working conditions” and are thus
included within the range of arbitrable subject matter. In
support of this argument, the Union and the Individual Plaintiffs
cite to cases that interpret “wages” and “conditions of
employment” as used in the National Labor Relations Act8
8
See 29 U.S.C. § 159 (a) (“Representatives designated or
selected for the purposes of collective bargaining . . . shall be
the exclusive representatives of all the employees in such unit
for the purposes of collective bargaining in respect to rates of
pay, wages, hours of employment, or other conditions of
employment.”); Id. § 158 (d) (mandatory subjects of
25
(“NLRA”) as encompassing employee benefits. See NLRB v.
Katz, 369 U.S. 736, 744 (1962) (sick leave benefits are
considered a “condition of employment”); W.W. Cross & Co. v.
NLRB, 174 F.2d 875, 878 (1st Cir. 1949) (finding that the term
“wages” encompasses a group insurance program); In re Inland
Steel, 77 N.L.R.B. 1, 4-5 (1948) (“[T]erm ‘wages’ as used in
Section 9(a) must be construed to include emoluments of value,
like pension and insurance benefits, which may accrue to
employees out of their employment relationship.”).
These cases are distinguishable, as the phrase “working
conditions” is distinct from the phrase “conditions of
employment.” See In re Inland Steel, 77 N.L.R.B. at 11-12
(stating that the phrase “conditions of employment” is intended
collective bargaining include “wages, hours, and other terms
and conditions of employment”); Id. § 152 (9) (defining the
term “labor dispute” to include any controversy regarding
“terms, tenure or conditions of employment”).
26
to have a broader meaning than “working conditions” as shown
in the NLRA’s legislative history). In the context of the Equal
Pay Act, 29 U.S.C. § 206(d)(1), the phrase “working conditions”
has been defined as the physical surroundings of and hazards to
a worker. See, e.g., Corning Glass Works v. Brennan, 417 U.S.
188, 201-03 (1974) (“[T]he element of working conditions
encompasses two subfactors: ‘surroundings’ and ‘hazards.’
‘Surroundings’ measures the elements, such as toxic chemicals
or fumes, regularly encountered by a worker, their intensity, and
their frequency. ‘Hazards’ takes into account the physical
hazards regularly encountered, their frequency, and the severity
of injury they can cause. This definition of ‘working conditions’
is . . . well accepted across a wide range of American
industry.”); Hodgson v. Corning Glass Works, 474 F.2d 226,
231-232 (2d Cir. 1973) (relying on the Department of Labor’s
definition of “working conditions” as encompassing the physical
27
environment of a worker, the court held that shift differentials
were not “working conditions”). Further, even if we were to
find that the phrase “condition of employment” was synonymous
with “working conditions,” the employees’ rights to disability
benefits were simply not memorialized within the final terms of
the Bristol CBA. If, for example, the Union seeks to complain
that the Company failed to bargain over disability benefits in
violation of their mandatory subjects of bargaining, then the
proper procedural route would be to file an unfair labor practice
with the National Labor Relations Board.
We join with the courts that have defined “working
conditions” as encompassing the physical surroundings of a
worker at the place of employment. Thus, under the Bristol
CBA, the terms “working conditions” and “wages” do not
encompass disability benefits. See also So. Ry. Co. v.
Occupational Safety & Health Review Comm’n, 539 F.2d 335,
28
339 (4th Cir. 1976) (finding that, under Section 4(b)(1) of the
Occupational Safety and Health Act of 1974, “working
conditions” “mean[] the environmental area in which an
employee customarily goes about his daily tasks”).9
Second, the Union and the Individual Plaintiffs argue that
disability benefits are generally provided for under the Bristol
CBA, and thus, disagreements over such benefits should be
submitted through the Bristol CBA grievance procedure. In
making this argument, the Union and the Individual Plaintiffs
rely on the language from the Bristol CBA providing that where
9
We recognize that the parties could have explicitly
defined the phrase “working conditions” to encompass a
broader meaning than that contemplated in these statutes. As
the parties did not provide any definition of “working
conditions” in the Bristol CBA, we believe that the cases
interpreting “working conditions” under the Equal Pay Act
and Occupational Health and Safety Act are instructive, as
they provide the definition as understood across the labor
industry.
29
a grievance “involve[s] the interpretation of the contract, then
either party may submit the matter to arbitration,” and providing
that the grievance procedure applies to “questions arising out of
this Agreement.”
The Union and the Individual Plaintiffs argue that the
sole reference to the “Sickness and Accident plan” provides
proof that the benefits were provided pursuant to the Bristol
CBA. However, when reading Article XIX(3) regarding
Medical Examinations in its entirety, the article contemplates a
situation where an employee seeks to continue working in spite
of a potential disability. The article states that an “employee
shall be entitled to a medical examination” and that the
employee may receive benefits under the “Sickness and
Accident plan” only when “no suitable reassignment is
available.” The situation contemplated is thus the reverse of that
of the Individual Plaintiffs, who seek to extend their right to
30
receive disability benefits.10 Further, the mere reference to the
“Sickness and Accident plan” without more does not incorporate
the entire Plan into the Bristol CBA. See RCA Corp. v. Local
241, Int’l Fed’n of Prof’l and Technical Eng’rs, 700 F.2d 921,
927 (3d Cir. 1983) (“[M]ere mentioning of the Retirement Plan
in the General Agreement is insufficient reason to construe the
Retirement Plan as part and parcel of the General Agreement.”).
We do not find any ambiguity in the Bristol CBA that would
permit it to be reasonably interpreted to provide for disability
10
The Union and the Individual Plaintiffs have produced
summaries of previous negotiations from which they argue
that disability benefits, or at least Accident and Sickness
benefits, were the subject of collective bargaining between the
Union and Company since 1966. Because the contractual
language is not ambiguous, we do not think it necessary to
examine extrinsic evidence to ascertain the parties’ intent.
Even were we to consider the negotiating history, we are still
left with a Bristol CBA that simply contains no provisions
defining the nature or extent of disability benefits, either
directly or by reference to an extrinsic document.
31
benefits or to provide for arbitrating a plan administrator’s
denial of such benefits arising from a separate ERISA plan.
C.
The employees’ right to receive disability benefits instead
derives from the Plan, which sets forth detailed information
concerning the qualifications for disability benefits, the types of
benefits offered, and the calculations for determining the
amount of benefits available. Pursuant to ERISA regulations,
the Plan provides its own separate claims procedure and manner
of appealing such decisions. See 29 U.S.C. § 1133; 29 C.F.R.
§ 2560.503-1 (2008).
Because the Plan provides the basis for the employees’
right to receive disability benefits, these rights cannot be said to
result from any agreement entered into between the Union and
32
the Company. This conclusion is further bolstered by the fact
that the Company unilaterally changed the Plan on December
19, 2002, to be effective on January 1, 2003. The Company
instituted these changes to the Plan during the period of the
applicable Bristol CBA (which was in effect from May 8, 2000
to May 7, 2004). Additionally, the Plan offers benefits that
apply to Rohm and Haas workers other than those governed by
the Bristol CBA – a further indicator that disability benefits
were not the fruit of collective bargaining.
We do not purport to hold that benefits provided pursuant
to ERISA can never be subject to the grievance or arbitration
provision contained within a CBA. Indeed, the regulations
governing ERISA specifically contemplate that an ERISA plan
may be established or maintained pursuant to a CBA and set
forth separate guidelines for such plans. 29 C.F.R. § 2560.503-1
(2008). Here, because the Plan does not reference the Bristol
33
CBA, or vice versa, we conclude that there is no evidence that
the ERISA plan was established or maintained pursuant to the
Bristol CBA. As such, the benefits have been provided for
under the Plan and initial claims or appeals over the denial of
benefits must be submitted through the Plan’s procedure, which
does not provide for arbitration.
As evidence that the Company has previously arbitrated
issues over disability benefits, the Union and the Individual
Plaintiffs refer the court to an arbitration over the denial of
disability benefits that took place in Houston between Rohm &
Haas Texas, Inc. and a local of the Paper Allied-Industrial,
Chemical and Energy Workers International Union, dated May
5, 2005. However, a reading of the arbitrator’s decision makes
clear that the matter was arbitrated pursuant to a provision
contained in the ERISA plan itself, not pursuant to a grievance
34
procedure established by the CBA.11 As noted by the Arbitrator:
11
ERISA provides in 29 U.S.C. § 1133(2) that every
employee benefit plan shall “afford a reasonable opportunity
to any participant whose claim for benefits has been denied
for a full and fair review by the appropriate named fiduciary
of the decision denying the claim.” Several courts have
upheld the inclusion of an arbitration clause in an ERISA plan
as part of the review process. See, e.g., Chappel v. Lab. Corp.
of Am., 232 F.3d 719, 724 (9th Cir. 2000) (“Thus, if the plan
contains an arbitration clause, the plaintiff must arbitrate the
dispute in accordance with the clause in order to exhaust his
administrative remedies before filing suit in federal court.”);
Seborowski v. Pittsburgh Press Co., 188 F.3d 163, 169-70 (3d
Cir. 1999) (holding that arbitration was appropriate where the
ERISA plan incorporated by reference terms of a
supplemental CBA, which included an arbitration clause);
Peruvian Connection, Ltd. v. Christian, 977 F. Supp. 1107,
1111 (D. Kan. 1997).
For example, in United Steelworkers of America v.
Retirement Income Plan for Hourly-Rated Employees of
Asarco, the Union sought to compel arbitration of “70/80”
benefits provided under an ERISA plan. 512 F.3d 555, 558-
59 (9th Cir. 2008). The determination of whether the
claimants were entitled to receive such benefits depended on a
calculation of the number of years of “Continuous Service”
served by each of the claimants. Id. at 558. The ERISA plan
specified that issues concerning contract interpretation be
subject to the plan’s own internal claims procedure, but also
provided for arbitration of disputes related to the number of
35
This is a case about the interpretation of an employee benefit
plan. The Collective Bargaining Agreement is silent as to
employee benefits and the administration thereof. In fact, all
language regarding employee benefits is contained in the
Company’s plan documents. As a result, this case involves the
interpretation and administration of these documents. This
arbitration is governed by [ERISA] . . . .
Thus, the ERISA plan covering the Rohm & Haas Texas, Inc. site is
unlike the Plan in this case. The Texas ERISA plan specifically calls
for arbitration if the claimant is unhappy with the results of the claims
procedure, whereas the Plan at issue here does not.
years of “Continuous Service.” Id. at 561. The ERISA plan
also appears to provide a general arbitration clause calling for
arbitration of disputes that “arise between any Employee . . .
and the Company.” Id. at 562. Applying the presumption of
arbitrability, the court held that the ERISA plan could
reasonably be interpreted to call for arbitration of such claims
and thus ordered arbitration of them. Id. at 561. Here, the
Plan does not call for arbitration as a means of determining
rights to benefits, and thus, a right to arbitrate the claims of
the Individuals Plaintiffs cannot derive from the Plan.
36
III.
For the foregoing reasons, we conclude that the District Court
erred in holding that the claim of the Individual Plaintiffs concerning
the denial of disability benefits is subject to the Bristol CBA’s
grievance procedures. We reverse the District Court’s grant of
summary judgment to the Union and the Individual Plaintiffs and
remand with instructions that summary judgment be entered for the
Company and the Plan and for further proceedings on Count II.
37