An LLC changed the scope of its business and, in doing so, reassigned work from hourly workers to higher-educated, more technically proficient workers. The hourly workers, also referred to as “Lab Testers,” were represented by a union, which filed a grievance alleging that the LLC violated a collective bargaining agreement (CBA) by assigning work to the more educated workers, or “Chemists,” that had previously been performed by the lab testers. The LLC entered into arbitration with the Labor Union, and the sole question posed to the arbitrator was whether the employer had violated the CBA by transferring the employees. The arbitrator concluded that the CBA did not restrict the LLC's transfer. The arbitrator then, without either party submitting the question, required the parties to determine whether the Chemists were part of the bargaining unit. After the LLC and the union failed to resolve the issue, the parties returned to arbitration, where the arbitrator ruled that the union’s bargaining unit must include the Chemists. The LLC petitioned the district court to vacate the arbitration award based on the arbitrator having exceeded his authority in deciding on an issue outside the original question presented. The district court concluded that the arbitrator lacked authority when it ruled that the Chemists were included in the bargaining unit, and the union appealed.
In HollyFrontier Cheyenne Refin., LLC v. United Steel, 132 F.4th 1184 (10th Cir. 2025), the tenth circuit affirmed the district court’s decision to vacate the arbitration award. The court explained that an arbitrator’s role is limited to the issues presented by the parties. The court distinguished a case cited by the dissent, in which an arbitration board resolved a pricing dispute that fell squarely within the scope of the parties’ submission, and the court had upheld that award because the board’s decision was directly related to the precise issue the parties had agreed to arbitrate. Burlington N. & Santa Fe Ry. Co. v. Pub. Serv. Co., 636 F.3d 562 (10th Cir. 2010). Because the company in Burlington had submitted that issue for arbitration, it could not later argue that the board had exceeded its authority. Id. at 567. The court reasoned that the case before it differs because the arbitrator raised the secondary question regarding the chemists' status, while both the LLC and the union had presented only the initial issue for arbitration, albeit worded slightly differently. The court concluded that the arbitrator had exceeded his authority in deciding whether the chemists belonged in the bargaining unit, because arbitration was limited solely to the scope of the initial question: whether the LLC violated the CBA. Therefore, the appellate court affirmed the judgment of the district court.
By Noah Coggan [email protected]
Edited By Jace Brown [email protected]
Edited By Hayden Mariott [email protected]