A Carefully Drafted Disciplinary Policy Is An Employer’s Best Friend
In 2015, top National Football League (“NFL”) quarterback, Tom Brady of the New England Patriots, was accused of cheating in a playoff game by having the footballs he used deflated so he could attain a more advantageous grip. The NFL has strict rules about the uniform air pressure range for footballs used during games. The NFL commissioned an independent investigation into the accusations against Brady, which resulted in a comprehensive report that found he did, in fact, take part in a scheme to deflate the footballs below the permissible range. The evidence was extensive and varied, and Brady did not fully cooperate with the NFL’s investigation.
Based on the investigation, the NFL imposed a four game suspension without pay upon Brady, which would have resulted in the loss of millions of dollars to him both directly and indirectly. Pursuant to the Collective Bargaining Agreement (“CBA”) between the NFL and the Players’ Association (“Association”), which set out a disciplinary process negotiated by both parties, Brady appealed his suspension by asking for an arbitration hearing before the NFL Commissioner Roger Goodell. At arbitration, Commissioner Goodell upheld the suspension, accepting the findings of the investigatory report.
Brady then appealed his suspension to Federal Court, claiming the arbitration award confirming his suspension should be overturned because of “fundamental unfairness” due to lack of adequate notice that his actions could lead to a suspension.
From the outset of his appeal, Brady faced an uphill battle procedurally. Labor agreements, such as the NFL’s CBA, which is a fairly negotiated agreement and deals with the disciplinary process leading to a final decision by an arbitrator, are essential to the workplace and are intended to quickly and conclusively resolve issues without court involvement. So long as the jurisdiction and powers of the arbitrator are in place, the Courts, already greatly backlogged, disfavor appeals of arbitration awards.
The Federal District Court, in a strongly worded opinion against the NFL, surprisingly upheld Brady’s appeal and vacated the four game suspension and all NFL discipline. The District Court cited fundamental fairness and lack of notice in finding Brady was denied his due process.
On Monday, April 25, 2016, upon further appeal by the NFL, the U.S. Court of Appeals for the Second Circuit, in a 2 – 1 panel decision, overruled the District Court’s decision and reinstated the initial four game suspension imposed by the arbitrator, NFL Commissioner Roger Goodell. NFL Management Council v. NFL Players Association, 2016 WL 1019883 (2d Cir. April 25, 2016). The Second Circuit did not find this to be a close call; the penalty flag was thrown and was appropriate. Barring reconsideration by the entire Second Circuit Judges sitting en banc, an extraordinary step under these facts, or an even longer shot, i.e. request for certiorari to the U.S. Supreme Court, the Brady suspension will stand.
We write about this decision as it serves as an important reminder that two well-established labor principles are alive and well: an arbitrator’s decision is rarely disturbed and well thought out disciplinary policies rule the day. The Circuit Court noted that “review of labor arbitration awards is narrowly circumscribed and highly deferential—indeed, among the most deferential in the law.” Id. at *1. This means that since the arbitration award confirmed the four game suspension, albeit a decision by the NFL’s own Commissioner, as the parties agreed to arbitration, that ruling is given great deference and can only be disturbed if the Court finds that the arbitrator acted beyond the scope of his authority. Most arbitration clauses give the arbitrator broad authority since the objective is to have disputes resolved efficiently and with finality.
So powerful is this doctrine that mistakes of law and/or fact by an arbitrator or failure to follow arbitral precedent are not alone reasons to vacate an arbitrator’s award. A good example of when it is proper for a court to overturn an arbitrator’s award is when he has ignored the plain language of the contract and merely substituted his own brand of industrial justice in place of the bargained for agreement of the parties.
In Brady’s case, the Second Circuit held it was improper to focus on what it believed was appropriate discipline for tampering with the footballs. Instead the focus should be on the arbitrator’s award to determine if it “even arguably” derived its “essence” from the CBA. It does not take a labor scholar to deduce that this type of review overwhelmingly favors the party who wins at arbitration. Still, the Association won at the District Court level by arguing essentially: the disciplinary policies implicated by Brady’s actions called only for a fine, foreclosing the NFL’s ability to suspend; the imposition of a four game suspension was fundamentally unfair; and the players were not given adequate notice that such discipline could result.
The problem with the Association’s argument (and the District Court’s holding), is that the triggering disciplinary policy, as bargained by the parties, uses very broad language and provides the NFL with a great deal of discretion when imposing discipline, which certainly did not exclude the possibility of a suspension. While the Association focused on the language provided for “equipment infractions”, the NFL (and the Second Circuit), determined that Brady’s behavior could be disciplined under the more broadly worded “conduct detrimental” language. This is meant to protect “the integrity of, or public confidence in, the game of professional football.” In light of the agreed disciplinary language, the Second Circuit held that the Commissioner’s suspension and arbitration award was rooted in “the essence of the contract” and, therefore, should be upheld.
The broader lesson for employers, whether or not their workforce is unionized, is that disciplinary policies should be drafted carefully so as to not unintentionally foreclose certain disciplinary responses to employee conduct. When drafting a disciplinary policy the goal should be to strike a workable balance between specificity and flexibility. Effective policies need to be tailored to the specific concerns of an industry and workforce, while also remaining broad enough to encompass a multitude of situations of potential misconduct and to allow for employer discretion. One general tip to consider, where it is possible the wrongdoing is of a severe nature, based on a reasonable, objective standard, is to use the phrase “up to and including termination” to define the potential scope of discipline.
We never know what type of incidents are going to arise that will require redress, so prudent employers should plan accordingly, and always consult labor and employment counsel for advice prior to implementation of a disciplinary policy or enforcement of its provisions.
THE PHILADELPHIA LABOR GROUP AT OFFIT KURMAN
ABOUT NEIL A. MORRIS
email@example.com | 267.338.1383
Neil Morris , chair of the Philadelphia labor and employment group, has passionately represented employers for the last 25 years. Mr. Morris specializes in the areas of labor and employment, municipal labor law, employment discrimination, defamation and business litigation. Mr. Morris has served as Special/Labor Counsel for more than 35 Pennsylvania Townships and Boroughs, the County of Bucks and many private employers. He is often brought into municipalities to handle “crisis” situations involving employees and/or management.
ABOUT GABRIEL CELII
firstname.lastname@example.org | 267.338.1361
Mr. Celii devotes his practice to representing businesses and municipal entities navigating labor and employment disputes ranging from wage and hour litigation and work place discrimination defense to labor negotiations and the resolution of grievances. During his representation of Philadelphia-area Townships and Counties, he has successfully defended claims brought against public officials and advised municipalities on the drafting of local ordinances, such as Police Pension DROP amendments.
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