FEDERAL MEDIATION AND CONCILIATION SERVICE

In the Matter of the Arbitration between FMCS No. 09-01065

Grievance No. 1-1E-07-31
PACE LOCAL 1161,
Union,

and

INTERNATIONAL PAPER CO,

Employer.
________________________________/

OPINION OF THE ARBITRATOR

February 19, 2010

After a Hearing Held December 10, 2009

At the Holiday Inn Hotel and Suites in Decatur, Alabama

For the Union: For the Employer:

Kevin Johnsen Samantha M. Gilland

Staff Representative Human Resources Generalist
USW District 9 P & C Papers
110 Wall Street N PO Box 189
Gadsden, AL 35904 Courtland, AL 35618-0189
 I. The Contractual Provision at Issue

Since 1971, the collective bargaining agreements between International

Paper Company (“Employer” or “Company”) and the Paper, Allied-Industrial,

Chemical & Energy Workers International Union, AFL-CIO (“PACE”) and its

Local 3-1161 (“Union”) and their respective predecessors have contained the

following provision regarding Vacation Eligibility:

An employee who on the first day of January has been in the service of
the Company continuously for the period specified below and who has
completed one thousand forty (1040) hours of work the previous year
shall be entitled to whichever of the following is applicable to him:

One (1) week after one (1) year of service.

Two (2) weeks after three (3) years of service.
Three (3) weeks after six (6) years of service.
Four (4) weeks after twelve (12) years of service.
Five (5) weeks after eighteen (18) years of service.
Six (6) weeks after thirty (30) years of service.
Except for the calendar year in which the first, third, sixth, twelfth,
eighteenth, and thirtieth employment anniversary date occurs in which
instances eligibility for the additional week of vacation shall be on the
employee’s anniversary date.

Time lost due to industrial accidents shall be counted in computing the

required one thousand forty (1040) hours.

The parties stipulated to the continuity of this language, which is taken from

Section X of the contract covering employees at the Company’s mill in

Courtland, Alabama, and running from June 15, 2002, through June 14, 2008

(JX 1 or “CBA”). TR 9.

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 II. The 2007 Grievance

No dispute arose over the quoted language until 2007, when the Union

filed the following grievance:

During the month of October 2007 International Paper informed

employees that was hired on September 19 2006 that the vacation they
received after completing one calendar year of service to the Company
would be taken back also any vacation pay an employee received would
have to be payed back to the Company. This also includes employees
hired in Nov. 2006.

JX 2. The Union takes the position that the exceptions provided in the first,

third, sixth, twelfth, eighteenth, and thirtieth anniversary years override the

1040-hour requirement and that, in those years, an employee is entitled to the

specified vacation regardless of whether he worked 1040 hours in the previous

calendar year.

The parties stipulated that the issue presented is:

Whether the Company violated Section X of the CBA by denying

grievants vacation and, if so, what is the remedy?

TR 11.

III. The Company’s Second- and Third-Step Answers

In a memo to the Union president, dated October 30, 2007, one of the

Company’s human resources generalists set forth the Company’s position:

There are two (2) requirements for vacation:

1. An employee must work 1040 hours at the Courtland Mill in the

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 year previous to the vacation, and
2. He/She must complete one (1), three (3), six (6), twelve (12),
eighteen (18), or thirty (30) years of service to be eligible for one
(1), two (2), three (3), four (4), five (5), or six (6) weeks of
vacation. Prior service with IP can be counted in determining the
number of weeks of vacation.

The 1040 hours must be worked in the previous calendar year, January 1
– December 31. The following are examples of these eligibility
requirements:

1. An employee is hired on May 1, 2006. Prior to December 31,

2006, he works 1200 hours; after May 1, 2007, he will be eligible
for one (1) week of paid vacation. After May 1, 2009 he will be
eligible for a 2nd week of paid vacation.

2. An employee is hired September 15, 2006. During 2006 he works

620 hours. He will not not be eligible for vacation in 2007. If he
works 1040 hours in 2007 he will be eligible for one (1) week of
paid vacation January 1, 2008. He will be eligible for a 2nd week
after September 15, 2009, provided he continues to work 1040
hours each year.

3. An employee has six (6) years of service with IP at another mill

and comes to Courtland on September 15, 2006. During 2006, she
works 630 hours at Courtland. She will not be eligible for vacation
in 2007. She will be eligible for three (3) weeks of paid vacation
on January 1, 2008, assuming she works 1040 hours in 2007. She
then will be eligible for additional weeks based on her total IP
service. Her Benefit Seniority Date is determined by her total
length of service with the company.

In summary, vacation eligibility is determined by (1) working 1040 hours

in the previous calendar year, and (2) completion of a year of service. An
employee becomes eligible for additional weeks of paid vacation on the
anniversary date of his/her employment in accordance with the schedule
on page 44 in the Labor Agreement. All of the provisions under
VACATION ELIGIBILITY must be read together – all parts of it
apply. It is for these reasons, this grievance is denied.

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JX 2; emphasis in original.

The memo is unclear on several points. In Example 1, there is no mention

of any 1040-hour requirement for 2008. In example 2, although the clause,

“provided he continues to work 1040 hours each year”, may be correct in the

context of that example, working 1040 hours each and every year is not a

requirement in general; rather it is a requirement for the preceding calendar

year. In Example 3, there is no mention of any hours worked at the other mill

before coming to Courtland, although those hours may not count toward the

1040 requirement.

In a third-step memo dated April 1, 2008, from the Company to the

PACE staff representative who handled the arbitration for the Union, the

Company asserted:

No where in Section X is the 1040 hours waived or negated – it is an

absolute requirement in all cases. If there have been cases where this has
been communicated differently, and/or handled differently, these were
incorrect, and do not represent a change in the language in the Labor
Agreement.

As stated in the second step answer, vacation eligibility is determined by

(1) working 1040 hours in the previous calendar year, and (2) completion
of the specified year(s) of service. Both requirements must be met, even
in the case of new employees, and obviously, employees hired September
19 could not have worked 1040 hours in that year. They were not,
therefore, eligible for a week of vacation until they had both worked 1040
hours in a calendar year, and completed one (1) year of service. For this
reason, then, this grievance must be denied.

JX 2; emphasis in original.

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 The statement that “obviously, employees hired September 19 could not

have worked 1040 hours in that year” appears to be belied by CX 2, which

seems to indicate that an employee worked 4,063.81 hours in 2008. If an

employee meets the threshold requirement of 1040 hours in a calendar year, it

matters not over what period within the year he worked them. If he works 1040

hours from September 15 through December 31, he has fulfilled the

requirement.

When the parties were unable to settle the grievance, the Union

demanded arbitration. A hearing was held on December 10, 2009, at a

neutral location in Decatur, Alabama. A transcript was made, reference to

which is denoted by TR followed page number(s). The parties were afforded

the opportunity to file post-hearing briefs, but only the Company did so.

IV. The Witnesses’ Testimony

JRR, called by the Union, TR 11-18: JRR was one on those hired on

September 19, 2006. He testified that during orientation, new hires were told by

HR generalist, MS, that they would receive a week’s vacation on the

anniversary of their date of hire. He doesn’t recall MS reading the vacation

eligibility language to the group. In November of 2007, he learned that he

would not be eligible for a week’s vacation until January 1, 2008. He doesn’t

know if he worked 1,040 hours in 2006.

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 RGB, called by the Union, TR 19-24: RGB was hired November 16,

2006. He testified that during orientation, MS told his group that “when we

reached one year of service, we would get one week of vacation.” TR 20. “The

1040 hours was never even mentioned to us. We had no knowledge of that.” TR

22. RGB admitted that during orientation, “everything in the contract book

[was] covered with [him], page by page, line item by line item[,]” and that he

read the contract booklet after hire-in. He asked his supervisor if they were

going to get vacation and was told that they weren’t. RGB did not work 1040

hours in 2006, but he did work 1040 hours in the 12-month period from his date

of hire until his first anniversary.

GLJ, called by the Union, TR 24-40: GLJ has worked for International

Paper for 29 years and is executive vive president of the Union. He filed the

grievance under consideration, JX 2. He was hired November 17, 1980, and

received his first week of paid vacation approximately two weeks after

Thanksgiving of 1981. TR 29, 33. He did not work 1040 hours in 1980 but did

work 1040 hours between his date of hire and first anniversary. He knows of no

one before September of 2007 who did not receive a week’s vacation on their

first anniversary date.

Excerpts from GLJ’s testimony:

Q. What evidence do you have to support your allegation that anyone and
any employee has received the vacation and that you have received that

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vacation?
A. I have no hard evidence. The only evidence I have is by asking people
and know people that's hired in after me, and I've seen it on the work
schedule where people hired in after me has got their one-year anniversary
date and received a week's vacation. … TR 32-33.

Q. Okay. Who brought this issue to you, to your attention?

A. I don't really believe a specific person brought it to my attention. I just --
I can't remember exactly, but I just remember, you know, hearing it through
union meetings and stuff like that, that people wasn't receiving their
vacation.
Q. Okay. I would like to read something to you, if I could.
A. Okay.
Q. In your grievance statement that you turned in, it says, "During the
month of October 2007, International Paper informed employees that were
hired on September the 19th, 2006, that the vacation they received after
completing one calendar year of service to the company would be taken
back. Also any vacation pay an employee received would have to be paid
back to the company. This also includes employees hired in November of
2006." So, who were the employees?
A. I'd have to look at the seniority list, but I do recall hearing some of the
individuals, and I can't recall their names exactly, I mean. But to my
knowledge, they took—put in for a week and was not going to receive pay.
Q. Okay.
A. I can't remember exact names.
Q. In the first sentence of your Grievance statement, though, you say
"employees," plural, "hired on September the 19th."
A. Yeah. I was trying to cover everybody during that.
Q. So, you don't have an employee who had that issue?
A. No. I was filing for all of them, for all the people hired in around that
date.
Q. So, do you know for a fact, Greg, that somebody received that vacation
and then was taken away?
A. Just by hearsay. … TR 34-36.

Q. In the grievance statement that you submitted to the company, it is stated

as a fact that employees that were hired September the 19th of 2006 received
the vacation and then it was taken back, as a fact.
A. I can't remember the exact fellow that did that, but I know it did happen.
TR 39.

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 MHP, called by the Union, TR 40-45: MHP has worked for International

Paper for over 19 years and is recording secretary of the Union. He was hired

December 3, 1990, and remembers being eligible for a week’s vacation on his

first anniversary date. He did not work 1040 hours in 1990 but did work that

many hours during the year ending with his first anniversary.

BRS, called by the Union, 46-73: BRS has been employed by

International Paper for almost 27 years and is president of the Union. He

testified that between 1983 and 2007, employees were eligible for a week’s

vacation on their first anniversary. He did work 1040 hours between his date of

hire and yearend and received his first week of vacation after his first

anniversary.

JRR, recalled by the Company, TR 57-62: He knows of no one who

received vacation pay on or about their first anniversary and then was required

to pay it back. He is part of the grievance because he was not afforded vacation

eligibility until the January 1 following his first anniversary date.

RGB, recalled by the Company, TR 62-63: RGB is part of the grievance

because he was not afforded vacation eligibility until the January 1 following

his first anniversary date.

GLJ, recalled by the Company, TR 63-73:

Excerpts from GLJ’s testimony:

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Q. Greg, the statement of grievance—and that is Joint Exhibit Number 2,
Mr. Arbitrator—doesn't this statement imply that a number received
vacations and then had to later have it taken back?
A. Yes, and I honestly cannot remember who it was, but I heard through
people in that group that hired in in October and November, that they—they
put in for a vacation, and I think—I can't remember if they actually got paid
for it or said they wasn't going to get paid for it, and they took it that they
was going to have to pay it back. The whole—the whole point of this
grievance is—the bottom line is that members in a specific group wasn't
allowed to take a week's vacation after their anniversary date.
Q. So, help me understand something because maybe I'm a little confused.
None of your witnesses here today can attest that they're one of the
employees—
A. Right.
Q. —that had vacation given and taken back?
A. Right. TR 64-65.

Q. Okay. But if I recall correctly, what the statement of grievance says is

they received it and then they had to pay it back or it was taken back.
A. Right, there was some of them that did that.
Q. Okay.
A. And I can't recall who it was. TR 66.

Q. So, in fact, none of your witnesses here today are the employees of the
statement of grievance?
A. Yes, they are, because I may have miss—wrote it wrong. I should—I
probably should have put was not allowed to take their week's vacation after
their anniversary date.
Q. So, am I to assume that then with the statement of grievance, that we're
to accept your word that this, in fact, happened, yet you provided no
witnesses and you have—
A. Yeah. I'm not going to lie about it.
Q. —no proof?
A. No, I'm not going to lie about it.
Q. Okay. Is the company to—no, let me rephrase that. Are you stating that
we are to accept this as an ongoing practice with no evidence and no
witnesses?
A. Yes. I mean, all of y'all know everybody since I've hired in, since
11/17/1980, after their anniversary date received a week's vacation. I mean, I
don't know of any. I mean, there may be some, but I don't know of any. TR

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67-68.

CWA, called by the Company, TR 85-95: CWA is retired but held

several management positions with International Paper from 1971 through

1998, among them being manager of industrial relations, manager of human

resources, and manager of labor relations. He was involved in all negotiations

and was signatory to all collective bargaining agreements executed during those

years. He testified that, to the best of his knowledge, new employees have not

been allowed to receive a week’s vacation after a year. He denied awareness of

any practice to that effect.

GB, called by the Company, TR 96-109: GB worked in the accounting

department at the Courtland Mill for 3½ years before assuming his current

position as business analyst at IP’s Riverdale Mill. At Courtland, a year-end

report would be prepared, indicating employees’ vacation eligibility for the next

year. If an employee failed to work 1040 hours, a note would be sent to the

employee’s department and to HR, informing them that the employee was not

eligible for vacation, with the instruction, “Please communicate to employee.”

CX 3. GB denied that the exception found in CBA Section X changed the 1040-

hour measurement period from the calendar year to the anniversary year.

V. Discussion

The grievance fails for lack of proof. It is an established rule of evidence

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that an arbitrator may draw a negative inference from a party’s failure to

produce evidence under its control. Hill & Sinicropi, Evidence in Arbitration

(BNA 2nd ed 1987) @ 102; Elkouri & Elkouri, How Arbitration Works

(ABA/BNA 6th ed 2003) @ 381-382. If as the Union contends, employees have

been eligible for a week’s vacation on their first anniversary date since 1971,

then the Union should have been able to parade as witnesses literally dozens of

its members who were afforded that benefit prior to September of 2006, when

the vacation policy allegedly changed. Instead of dozens who surely would exist

if the Union were correct, a grand total of two were produced—two who

received their first-year vacation benefits decades ago.

Concededly, the collective bargaining agreement expressly allows an

arbitrator to consider past practice in a proper case:

In the event that the contract provision in question is ambiguous,

unequivocal past practice may be used to resolve the issue. (Emphasis
supplied.)

CBA Section IX @ 41. See generally Elkouri & Elkouri, How Arbitration

Works (ABA/BNA 6th ed 1997) @ 605-630; Hill & Sinicropi, Management

Rights (BNA 1986) @ 20-21.

It is also true that the arbitrator has accepted evidence of past practice in

some cases: UAW & Its Local 62 and Jackson Innova Corp, 105 LRP 55078

(Arb 1989); Amalgamated Transit Union Local #725 and Birmingham-

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Jefferson County Transit Authority, 105 LRP 55096 (Arb 1997); Feralloy

Corp, 115 LA 346, 01-1 ARB ¶ 3711, 28 LAIS 1033 (Arb 2000).

It is equally true that he has found evidence of past practice lacking in

other cases: USWA Local 81 and Dravo Lime Co, 105 LAIS 55084 (Arb 1995);

IBEW, Local 2356 and Okonite Co, 01-2 ARB ¶ 3830, 28 LAIS 3805 (Arb

2001); UFCW Local 867 and Cargill Salt Co, 03-2 ARB ¶ 3560, 31 LAIS 467,

103 LRP 57379 (2003); Teamsters, Local 214 and Shiawassee County Sheriff,

05-1 ARB ¶ 3096, 33 LAIS 8, 105 LRP (Arb 2005).

There are several reasons why the doctrine of past practice should not be

applied in this case. First, the contractual language at issue is not really

ambiguous. The most that can be said is that it is a bit unusual to describe an

employee’s very first week of vacation as an “additional” week, but that can be

excused as the scrivener’s attempt at brevity, since the word clearly applies in

all other cases mentioned in the exception.

The meaning of the vacation provision seems clear, as explicated by the

Company representative at the arbitration hearing:

Here's the reason this exception language is in the contract and

includes one-year anniversary. A new employee hired in March 1st of
2006, the first day of January of 2007, who completes 1040 hours, in
reading this language tried to determine if he is getting vacation on the
first day of January of 2007 really needs to ask himself the following
question: What is my status? Have I been continuously employed for
the period specified below? That's one year. The answer is no. Have I
completed 1040 hours of work in the preceding year? Meaning since

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 March when I was hired in 2006, did I complete 1040 hours of work
in 2006? The answer is yes. So, if I have completed 1040 hours of
work but I have not been in the service of the company continuously
for a year, on one year, on the first day of January of 2007, am I
eligible for a vacation one week in calendar year 2007?
Mr. Arbitrator, the answer is no. Why? Because I have not—I
have only completed half of the provisions stipulated by the contract,
completed 1040 hours of work in the previous year, but I had not
reached my one-year anniversary, which in this case is not until
March 1st of 2007.
So, what is my status on the first day of January of 2007 having
completed half of the requirements of the language provision? The
new employee's in a holding pattern until he reaches his anniversary
date on March 1st of 2007 where he will then be eligible for one week
of vacation for the 2007 calendar year to be taken in 2007.
Mr. Arbitrator, if the contract language did not include the one
year in this paragraph, the employee in the example we just reviewed
would have to wait until the first day of January of 2008, an extra ten
months from his one-year anniversary, and have completed 1040
hours of work in the previous year, in 2007, in order to be eligible for
one week of vacation in calendar year 2008. In other words, the
employee would go a year and ten months before being eligible.

TR 79-81.

As noted by the Company representative, but for the first-year

exception, the employee in the example just offered would also have to work

1040 hours in 2007. If he failed to do so, he effectively would lose vacation

credit for the 1040 hours he worked in 2006.

Even if there were some ambiguity in the vacation provision, the CBA

requires unequivocal evidence to establish a past practice. In light of the

testimony of Company witnesses GWA and GB, the evidence is hardly

unequivocal. There simply is no way that two decades-old instances of

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deviation from the plain language of the CBA establish a past practice of

deviation. If there were such a practice, the Union would have presented a

multitude of witnesses to that effect. It did not because there must not have been

a practice of deviation.

As for the two employees who testified that they were told during

orientation that they would be eligible for a week’s vacation on their first

anniversary, one admitted that “everything in the contract book [was] covered

with [him], page by page, line item by line item[,]” and that he read the contract

booklet after hire-in, so any confusion was on his part. The other probably

misunderstood the explanation he received.

VI. Award

For all the foregoing reasons, the grievance is DENIED.

Dated February 19, 2010 ________________________________

E. Frank Cornelius, PhD, JD, Arbitrator

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