Union contract may have an overlooked benefit

Most companies find having a union makes their operations more expensive and limits their freedom of action, but there can be some unexpected benefits. A recent case from the U.S. 8th Circuit Court of Appeals (which covers Arkansas) illustrates how a union contract can be a shield against state law-based claims.

Facts

Lott Johnson is an African-American man who worked as a driver for UPS. UPS and its union agreed to an expansive collective bargaining agreement (CBA). The CBA prohibited UPS from holding employees responsible for damage to merchandise unless the employee violated established rules and practices. Employees could be disciplined or held financially liable for such damage, but not both. UPS generally may not fire an employee for a first offense unless it is an "offense of extreme seriousness." The CBA also prohibited UPS from unlawfully discriminating against employees, the same claim he made in his lawsuit.

UPS terminated Johnson's employment following an incident where he conducted a "free fall" delivery to a UPS retail store. In other words, he dropped merchandise pallets from the back of his trailer directly onto the ground. When an employee at the store reported that the merchandise had been damaged, Johnson claimed that the employee authorized the "free fall" delivery and that she falsely reported otherwise to UPS. After an investigation, UPS determined that the incident was an offense of "extreme seriousness" and fired Johnson.