Unpublished Disposition, 872 F.2d 428 (9th Cir. 1986)

MEMORANDUM^* 

We decide whether a dispute over job duty reassignment is arbitrable under a collective bargaining agreement modified by a Memorandum of Understanding.

Chevron and Local Union 1-369 signed a collective bargaining agreement on February 2, 1986. Several months later, on July 11, 1986, they signed a Memorandum of Understanding. The Memorandum modified the CBA to allow the Company to make job cutbacks and to supplement Chevron's Retirement Plan. It included a clause subjecting some disputes arising under its provisions to the CBA's arbitration procedures.

Pursuant to the Memorandum, the Company eliminated the head operator position at two plants. The Union claims the Company assigned the head operator's functions to utilities operators but did not increase the latters' wages to the higher head operator rate. The Union filed a grievance under the CBA demanding that the utilities operators be paid the higher wage. The Company responded that it acted within its authority to assign work to employees and refused to arbitrate.

The Union sued to compel arbitration. The district court found on summary judgment that the parties excluded this dispute from arbitration under the Memorandum.

We review de novo and affirm. Teamsters Local 315 v. Union Oil Co., 856 F.2d 1307, 1309 (9th Cir. 1988), cert. denied, 109 S. Ct. 869 (1989).

We note at the outset that "arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not so agreed to submit." AT & T Technologies, Inc. v. Communication Workers of Am., 475 U.S. 643, 648 (1986). We interpret arbitration agreements to further federal labor policy. Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 577-78 (1960).

Federal labor policy favors resolving labor-management disputes through arbitration. "An order to arbitrate 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." AT & T, 475 U.S. at 650 (quoting Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 584-85 (1960)).

Here, the Memorandum excluded from arbitration all grievances that challenge decisions committed to the Company's discretion. Paragraph 7 of the Memorandum states:

Any dispute as to the interpretation or application of this Memorandum of Understanding shall be subject to the grievance and arbitration provisions of the Collective Bargaining Agreement.

The clause then excludes from arbitration "any claim which seeks ... a change in any determination reserved to the company ... by this Memorandum of Understanding."

The Memorandum committed the elimination of the head operator position to the Company's sole discretion. Paragraph 1 of the Memorandum states that job cutbacks are within the Company's discretion and excluded from arbitration:

The company has identified certain groups within which surplus jobs are to be eliminated.... The number, classifications, and location of surplus jobs shall be determined solely by the company. (emphasis supplied).

The Union says its grievance does not challenge the Company's decision to eliminate the head operator position but argues that the dispute is over wage rates and should be resolved solely by reference to the wage scales in the CBA. It mischaracterizes the dispute. The crux of its grievance is that the utilities operators are working in the head operator classification and are entitled to the head operator's wage. The grievance in effect challenges the Company's decision to eliminate the classification. Because the Union's grievance challenges this elimination, we find this dispute non-arbitrable under the Memorandum.

The Union also asserts the clause granting the company discretion to eliminate "surplus" jobs is ambiguous. It claims the Memorandum grants the Company discretion to eliminate only jobs meeting a mutually accepted definition of "surplus." The Company did not eliminate the job duties of the head operator but delegated them to other employees. Because the work of the head operator is still necessary, the Union claims the position is not "surplus" and its elimination is not authorized by the Memorandum.

The Memorandum is unambiguous and grants the Company sole discretion to choose the classifications of surplus jobs. The Union challenges the Company's elimination of a job classification. The clause does not require arbitration of this dispute.

AFFIRMED.