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Allis-Chalmers Manufacturing Co.

39 Lab. Arb. Rep. 1213 (BNA) (1962)

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Allis-Chalmers Manufacturing Co.

Labor Arbitration

39 Lab. Arb. Rep. 1213 (BNA) (1962)

Facts

Allis-Chalmers Manufacturing Co. (the company) (defendant) had a collective-bargaining agreement with a labor union (the union) (plaintiff). The parties’ agreement contained no explicit limitation on management’s right to subcontract bargaining-unit work. The company decided to subcontract two kinds of work that would customarily be performed by bargaining-unit employees: (1) janitorial work to Don’s Window Cleaning Company and (2) manufacturing work involving certain operating mechanisms to Kramer Industries. The collective-bargaining agreement contained an arbitration clause that covered “any grievance” concerning compliance with “any provision” of the agreement. The union submitted two grievances to arbitration, contending that the company violated the implied covenant of good faith and fair dealing by entering the two subcontracts. The company contested the arbitrability and merits of these grievances.

Rule of Law

Issue

Holding and Reasoning (Smith, Arbitrator)

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