Seventh Circuit issues mandamus to vacate Reagan's order in employment dispute

By Bethany Krajelis | Feb 14, 2013



A federal appeals panel this week issued a writ of mandamus to vacate the rulings of U.S. District Court Judge Michael Reagan in an employment dispute against a railroad company.

The Brotherhood of Locomotive Engineers and Trainmen sought district court review of a decision from the National Railroad Adjustment Board, which is charged with resolving collective bargaining agreements in the railroad industry.

After exhausting internal procedures, the union filed a grievance with the board over Union Pacific Railroad Co.’s firing of a locomotive engineer named Narron.

The board ordered the railroad company to reinstate Narron with back pay, but gave it permission to offset that pay by any earnings he obtained between his firing and reinstatement.

The union challenged the earnings-offset provision of the award in district court, where Reagan remanded the case back to the board to determine whether Narron had any earnings during this gap in time. He also ordered that this provision of the board’s order be vacated.

Reagan’s rulings spurred both the union and the railroad company to appeal to the Seventh Circuit. Both parties took issue with Reagan’s decisions to vacate the earnings-offset provision in the board’s order and order the board to determine whether Narron had any earnings.

In its opinion, the federal appeals panel that consisted of Judges Richard Posner, Joel Flaum and Ann Claire Williams noted that “there are questions about our jurisdiction over both appeals, as well as about the district court’s jurisdiction.”

Writing for the court, Posner explained that the Seventh Circuit’s appellate jurisdiction “depends on the district court’s order being a final judgment.”

Because Reagan’s order “appears to envisage further proceedings before him after the board determines Narron’s earnings if any during his layoff period,” Posner wrote that his order is non-final and therefore not appealable.

The panel used the term “appears to” because Posner wrote that “we don’t know why the judge vacated the earnings-offset provision—a provision of an award that he thought he had no jurisdiction to review.”

While the panel could remand the case back to Reagan for an explanation on why he vacated that provision, Posner wrote “that would extend the litigation unnecessarily.”

He added that “it is obvious that the order vacating the provision exceeded his authority, and such an error can be corrected by mandamus, and should be to move the litigation along.”

As such, the federal appeals panel treated the parties’ notice of appeal as petitions for mandamus.

Posner wrote that Reagan exceeded his authority because the Railway Labor Act only allows district court judges to vacate the board’s awards on three grounds: if the board failed to comply with statute, exceeded its jurisdiction or committed fraud.

“The judge mentioned none of these grounds, and anyway none of them is applicable to the Board’s not having determined Narron’s earnings,” Posner wrote for the panel. “So we vacate the striking of the earnings-offset provision of the award.”

That, Posner wrote, leaves the appeals panel to review Reagan’s order remanding the matter to the board to determine if Narron earned any money during his layoff period.

“Since the order contemplates the possible return of the case to the district court if he’s found to have had earnings, we are still faced with an unappealable … non-final district court order,” he wrote. “But that order, too, exceeded the district court’s jurisdiction and requires correction by mandamus” because it disrupts the process of the National Railway Adjustment Board.

Both parties, according to the opinion, contend that the board’s awards in employment disputes like the one in this case are “always made without reference to whether the employee had earnings during the layoff period.”

If the board decides an employee should be reinstated with back pay, the parties assert that they then work out the amount of back pay, the opinion states, adding that if they can’t come to an agreement, they can go back to the board.

“Although no one is questioning the legality of the Board’s practice, the district judge in effect has ordered it changed by requiring that the existence of earnings during the layoff period be determined before the Board’s order can be judicially reviewed,” Posner wrote.

If Reagan’s order stands in this case, Posner wrote that “no longer will parties to disputes arbitrable by the National Railway Adjustment Board be able to postpone the resolution of disputes concerning the amount of a worker’s net lost income until after the Board’s order has been issued and, if challenged in court, upheld.”

Since courts don’t have the authority to change practices of administrative agencies unless their legality is challenged, the federal appeals court determined that Reagan exceeded his authority and as such, vacated his order.

The federal appeals panel declined to decide the validity of earnings-offset provision, saying that it would “exceed our authority to issue a writ of mandamus, an authority limited in this case to ordering rescission of the district court’s order that vacated the earnings-offset provision and remanded the case to the Adjustment Board.”

St. Louis attorney Clifford Godiner represented the railroad at the district court level, where Christopher Grant, Marilyn Teitelbaum and Michael Wolly, all of St. Louis, represented the union.

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