Legally Binding: Collective bargaining agreements

Much to the chagrin of many a manager, workers and unions have rights, collective bargaining agreements are legally enforceable and arbitrators’ decisions are binding. Compliance is not optional.

A dispute arose between a group of unionized employees and hotel management of a property in California. The group was assigned to greet guests at their cars or at the front door upon arrival at the hotel. The group also parks cars, directs the flow of traffic outside the hotel and holds car keys until guests depart. Per the parties’ collective bargaining agreement (CBA), the group also has access to four designated parking spots to use for temporary parking. These spots generate tips and “incentive-based compensation” amounting to approximately $100/shift in addition to the workers’ regular salary. 

The hotel also hires valets who managed the hotel’s 100 space parking garage.

The hotel unilaterally removed all parking-related functions from the group and gave those responsibilities to the valets. In response—predictably—the groups’ union filed a grievance. The contractual grievance procedure was unsuccessful in achieving a resolution, and the matter was referred to arbitration. The arbitrator determined the hotel violated the CBA “by reassigning parking duties in the four designated spots.” The arbitrator’s award required, by a specified date, reinstatement of the four parking spaces to the group and payment to them of lost compensation, determined to be $162,000. 

The hotel resisted. Five months following the compliance date, the hotel still had not reinstated the groups’ parking duties or paid the money owed. Unsurprisingly, the union pursued enforcement. The dilatory hotel finally restored the parking duties and paid the ordered compensation. The union, however, predictably sought, in addition, compensation for its lost income for the five months of delay. That matter has been remanded to the arbitrator for determination of the additional amount to which the group will be entitled.  

The hotel could have saved a lot of time and money by complying with the CBA, negotiating with the union concerning desired modifications and promptly abiding by the arbitrator’s award. Collective bargaining agreements are legally binding contracts; violate them at your peril.