Wis.LIRC ER Decision: Atkins - December 18, 1996 - Race discrimination - pay differential based on employer's good-faith interpretation of collective bargaining agreement provision; FLMA pre-emption where interpretation of collective bargaining agreement required

STATE OF WISCONSIN
LABOR AND INDUSTRY REVIEW COMMISSION
P O BOX 8126, MADISON, WI 53708-8126 (608/266-9850)

BOOKER ATKINS, JR, Complainant

PEPSI-COLA GENERAL BOTTLERS, Respondent

FAIR EMPLOYMENT DECISION
ERD Case No. 199550094, EEOC Case No. 26G950571

An administrative law judge (ALJ) for the Equal Rights Division of the Department of Workforce Development (Department of Industry, Labor and Human Relations prior to July 1, 1996) issued a decision in this matter. A timely petition for review was filed.

The commission has considered the petition and the positions of the parties, and it has reviewed the evidence submitted to the ALJ. Based on its review, the commission agrees with the decision of the ALJ, and it adopts the findings and conclusion in that decision as its own.

DECISION

The decision of the administrative law judge (copy attached) is affirmed.

Dated and mailed December 18, 1996
atkinbo.rsd : 110 :

/s/ Pamela I. Anderson, Chairman

/s/ Richard T. Kreul, Commissioner

/s/ David B. Falstad, Commissioner

MEMORANDUM OPINION

This case concerns an allegation that the respondent, Pepsi-Cola General Bottlers, discriminated against complainant Booker Atkins, Jr. in rate of pay because Atkins is African-American and because he had filed a complaint of discrimination against Pepsi-Cola in 1990.

As the Administrative Law Judge found, Atkins had worked part-time for Pepsi-Cola for 10 years when, effective November 20, 1994, he was hired as a full-time employe of Pepsi-Cola. With this change, he became subject to a "step rate" provision in which his pay rate would increase over time from 70% to 100% of the regular rate for the position. The immediate effect of this, however, was that his pay rate was reduced to $9.12/hour.

Based on the evidence offered at the hearing held before him, the Administrative Law Judge found that neither Atkins' race nor the fact that he had filed a discrimination complaint against Pepsi-Cola in 1990 were factors in the decision by Pepsi-Cola to pay Atkins at the rate of $9.12/hour after he became a full-time employe. On this basis, the Administrative Law Judge made a Conclusion of Law that Atkins had failed to establish that Pepsi-Cola violated the Wisconsin Fair Employment Act.

The Administrative Law Judge also made a Conclusion of Law that the Federal Labor Management Relations Act pre-empted the Equal Rights Division from basing any finding of fact or conclusion of law on an interpretation of the collective bargaining agreement between Pepsi-Cola and Teamsters Local 344 which governed the terms and conditions of Atkins' employment.

For the reasons discussed below, the commission agrees with both of these Conclusions of Law.

Pre-emption -- The commission has previously recognized the holding of Lingle v. Norge Division of Magic Chef, 486 U.S. 399 (1988), that Sec. 301 of the Federal Labor Management Relations Act preempts certain kinds of claims relating to labor agreements. It has also recognized, however, that the significant question is not whether a collective bargaining agreement is merely involved in a case, but whether it would be necessary to interpret the provisions of such a collective bargaining agreement to decide the issue(s) presented by the case. Seeman v. Universal Foods (LIRC, 03/30/92); see also, Universal Foods Corporation v. LIRC and Barbara Damato, No. 89-CV-014059 (Milwaukee Co. Cir. Ct., July 10, 1990).

Thus, determining whether Atkins' claim is pre-empted requires consideration of the issues presented by his claim, including the questions raised by Atkins' prima facie case, Pepsi-Cola's response to it, and Atkins' efforts to prove that Pepsi-Cola's response was a pretext for discrimination. (1 )

Atkins offered evidence that certain white persons, who he asserts were hired as full-time employes under the same contract provisions as he was, were paid more than he was when they were hired. Together with the evidence concerning his race and previous filing of a discrimination complaint, and the evidence concerning his own rate of pay, this can be considered to have established a prima facie case of discrimination in pay. (2 ) The next question is whether Pepsi-Cola can be considered to have advanced a legitimate non-discriminatory reason for the difference in treatment. Pepsi-Cola satisfied its responsibility to articulate a non-discriminatory reason for what it had done by stating that the pay rates of Atkins and of the white employes he compared himself to were all set according to the provisions of the applicable collective bargaining agreement, which is neutral on its face with respect to the issue of race (as well as the issue of retaliation for the filing of previous discrimination complaints). Specifically, Pepsi-Cola asserted that under the applicable agreement, the white employes in question were not new hires and that this accounted for the different wage rates.

The question then became, whether Atkins could be said to have met his burden of proving by a preponderance of the evidence that the facially non-discriminatory reason advanced by PepsiCola was in fact a pretext for intentional discrimination. The burden on Atkins at that stage was to establish that Pepsi-Cola's articulated non-discriminatory reasons were false and that Pepsi Cola intentionally discriminated against Atkins. Spearman v. Beloit Convalescent Center (LIRC, 09/19/95).

Atkins' attempts to prove that Pepsi-Cola's articulated reason for the different pay rates was a pretext for discrimination, necessarily relied on arguments involving the meaning of the collective bargaining agreement. Given the specific contract language involved, the critical question is when the white employes to whom Atkins compares himself "[became]...regular full-time ... hourly employe[s]" within the meaning of the language in the agreement's provision concerning the applicability of the step rate.

That question cannot be answered solely by reference to the provision itself because the terms used are latently ambiguous. The language requires interpretation, by the use such tools as consideration of bargaining history and past practice of Pepsi-Cola and the union (including such matters as the adoption of "side letters"). Atkins cannot prevail on his claim, unless he can prove that Pepsi-Cola's articulated reason for the different pay rates was a pretext for discrimination. He cannot do that without proving that the collective bargaining agreement must be interpreted, with respect to the question of when the white employes "[became]...regular full-time ... hourly employe[s]", as he claims, rather than as Pepsi-Cola asserts. His claim, in other words, requires interpretation of the collective bargaining agreement. Therefore, under the rationale discussed in Seeman v. Universal Foods, the claim must be considered pre-empted.

Discrimination -- Even if there were no pre-emption issue relative to questions of interpretation of the collective bargaining agreement, the commission would arrive at the same result here, because the evidence does not persuade it that Pepsi-Cola was relying on a particular interpretation of the agreement merely as a pretext to engage in discrimination because of Atkins' race or prior complaint.

As noted, Pepsi-Cola's asserted nondiscriminatory reason for its determinations as to the pay rates of Atkins and the white employes he compares himself to related to its interpretation of provisions of the collective bargaining agreement. (3 ) It is an understandable reaction on Atkins' part, to attempt to argue that Pepsi-Cola's interpretation is wrong, but this is not necessarily determinative. In some cases, the question of whether an employer's asserted nondiscriminatory reason is objectively correct can be considered irrelevant, if it appears that the employer genuinely believed it to be true. Moncrief v. Gardner Baking (LIRC, 07/01/92). The trier of fact need only determine that the employer in good faith believed in those reasons and that the asserted reasons for the action were not a mere pretext for discrimination. Salinas v. Crivello Properties (LIRC, 06/05/92). In this case, in which Pepsi-Cola asserted that its actions were based on a certain understanding as to the meaning of certain provisions of the collective bargaining agreement, the real question is thus whether Pepsi-Cola (and its representatives and agents through whom it acted) genuinely believed that the provisions in question had the meaning they now claim. If they did, and if that (rather than Atkins' race or earlier discrimination complaint) was actually the subjective motivation for their actions, then there was no discrimination -- even if an arbitrator applying contract interpretation principles might conclude that Pepsi-Cola was "wrong" in its beliefs about what the agreement meant.

The commission has carefully considered the evidence in the record with respect to the history of the collective bargaining agreement provisions at issue and Pepsi-Cola's administration of them. The interpretation which Pepsi-Cola relied on was not an unreasonable one considering the history of the provisions and their express language. The reasonableness of an employer's reasons for its decisions may be probative of whether they are pretext, Zeick v. Menasha Corp. (LIRC, 08/17/89); in this case, the reasonableness of Pepsi-Cola's interpretation of the relevant language inclines the commission to believe that Pepsi-Cola genuinely believed that it was applying the agreement appropriately. For this reason, and also giving due regard to the evident assessment of the Administrative Law Judge as to the credibility of the witnesses presented by Pepsi-Cola, the commission agrees with the evident finding of the Administrative Law Judge that Pepsi-Cola's reliance on an interpretation of the collective bargaining agreement was genuine and was not a pretext to hide unlawful motives. Therefore, the commission agrees with, and adopts, the ultimate finding of fact made by the Administrative Law Judge to the effect that neither Atkins' race nor the fact that he had filed a discrimination complaint against Pepsi-Cola in 1990 were factors in the decision by Pepsi-Cola to pay Atkins at the rate of $9.12/hour after he became a full-time employe.

cc:
James H. Hall, Attorney for Complainant
Robin L. VanHarpen, attorney for Respondent

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Footnotes:

(1)( Back ) Even though the question of dismissal for failure to present a prima facie case becomes irrelevant once a case has been fully tried, see, e. g., Kurtz v. School Dist. of St. Croix Falls (LIRC, 06/10/93), that does not mean that the prima facie case methodology becomes useless as an analytical tool. The prima facie case model was intended to serve as a sensible and orderly way to evaluate the evidence in light of common experience, see, Gentilli v. Badger Coaches (LIRC, 07/12/90), aff'd. sub nom. Gentilli v. LIRC, (Dane Co. Cir. Ct. 01/15/91), and it may serve that purpose even where a case has been fully tried. It is for that purpose, that the commission here considers questions relating to the nature of Atkins' prima facie case and Pepsi-Cola's response to it.

(2)( Back ) Pepsi-Cola's arguments seem to assume that Atkins made out a prima facie case without any reference to differential treatment of similarly-situated white employes, and it proceeds as if the matter of the allegedly-similarly situated white employes is properly considered a part of Atkins' attempt to prove pretext, rather than part of his prima facie case. See, Respondent's Brief, pp. 1 ff. However, proof that others not in the protected classification were treated more favorably is generally considered an essential part of a prima facie case. Therefore, the commission believes that it is more appropriate to analyze this case as if Atkins' allegations concerning allegedly-similarly-situated white employes were part of Atkins' prima facie case. Pepsi-Cola's reliance on the collective bargaining agreement and its assertion that those white employes did not "become regular fulltime...hourly employe[s] after April 5, 1993" within the meaning of that agreement, are appropriately considered to be a part of its articulation of a response to Atkins' prima facie case.

(3)( Back ) Because of the commission's views on the pre-emption issue in this case, which include the view that it is pre-empted from engaging in interpretation of the collective bargaining agreement to resolve Atkins' claim, it has intentionally made no express findings of fact on these specific contract matters. It would note, however, that having considered the evidence, it finds the description of these issues contained in Pepsi-Cola's brief to be accurate.