Case of the Week Decided November 1, 2013 – United States Court of Appeals for the Seventh Circuit Rules Against Titan Tire Union in Freeport, Illinois

An arbitrator ruled that Titan Tire of Freeport must pay the salary of the Union President which was nearly $80,000 and about $50,000 for the Benefit Representative. The ruling was upheld by the Federal District Court. Titan Tire appealed the ruling, and the decision of the District Court was reversed. The Court Stated:

The arbitrator found that the labor agreements between Titan and the union required Titan to pay the full-time salaries of Local 745’s President and Benefit Representative. However, such an agreement violates the plain language of Section 302(a) of the LMRA and is not exempt by Section 302(c) because the President’s and Benefit Representative’s full-time salaries are not vested rights earned “by reason of” their former employment at Titan. Rather, the President and Benefit Representative earn their current salaries because of their service to Local 745 members. Because the arbitrator’s order to Titan to reinstate direct salary payments to the President and Benefit Representative would require Titan to violate Section 302, its decision must be vacated. For these and the forgoing reasons, we REVERSE and REMAND for further proceedings consistent with this opinion.

For the full ruling see Titan Tire Corp. of Freeport, Inc. v. United Steel, Paper and Forestry etc., No. 12-1152 (November 1, 2013) at
http://media.ca7.uscourts.gov/cgi-bin/rssExec.pl?Submit=Display&Path=Y2013/D11-01/C:12-1152:J:Manion:aut:T:fnOp:N:1233682:S:0

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