Appendix — SeaRiver Maritime, Inc. v. Exxon Seamen's Union

Court, U.8.

FILED

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OFFICE OF iME Citan

No,

In THE

Supreme Court of the United States

OcTOBER TERM, 1995

SEARIVER MARITIME, INC.

¥ Petitioner,

EXxON SEAMEN’S UNION,

Respondent.

Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Third Circuit

APPENDICES TO

PETITION FOR A WRIT OF CERTIORARI

DONALD J. FAY JOHN F. DAUM

RICHARD R. CERBONE (Counsel of Record)

CARLIN, HADDOCK, FAY O’ MELVENY & MYERS

& CERBONE, P.C. 555 Thirteenth Street, N.W.

25 Vreeland Road, Box 751 Suite 500 West

Florham Park, NJ 07932 Washington, D.C. 20004

ALBERT R. GALIK (202) 383-5300

SEARIVER MARITIME, INC. PATRICK J. CONLON

Citicorp Center, Suite 3200 JoserH T. WALSH, III

1200 Smith Street 200 Park Avenue

Houston, TX 77002 Florham Park, NJ 07932

Attorneys for Petitioner

April 10, 1996

ST

WILSON - Eres Printine Co., Inc. - 7869-00086 - WasnincTon, D.C. 20001

INDEX TO APPENDIX

APPENDIX A

Opinion and Judgment of the United States Court

of Appeals for the Third Circuit, filed January 11,

See Caicos ANNs at RE RTT i

APPENDIX B

Opinion and Order of the United States District

Court for the District of New Jersey, filed Decem-

ge RRR BERR DN IE IPRS a eR

APPENDIX C

Opinion of the Chairman of the Panel of Arbitra-

tors, dated November 27, 1992 .........0

APPENDIX D

Exxon Shipping Company Policy Statement on

Employee Alcohol and Drug Use, dated April 1,

UNE diNis ccs cecdlsieaasocsa eatemiceds Madi ceeaskauhibeen det Sechekdbsenciscccde ie

APPENDIX E

Letter of Exxon Shipping Company to All Ocean-

going Employees of Exxon Shipping Company,

ee I tn, SI varietals cdeceincicascccceendnanece

APPENDIX F

Report of Discharge for Alan B. Cash, dated May

SA = SE A Dadilicn Alec claphidilisinctittilindininacnindentecsctihaeticantdessstais

APPENDIX G

Letter of Exxon Shipping Cor:pany to Alan Cash,

I

APPENDIX H

Portions of Coast Guard and Department of Trans-

portation Regulations concerning Reasonable Cause

Testing Requirements, 46 C.F.R. § 16.250(a)-(d)

(1989)

Page

la

23a

67a

73a

75a

ii

INDEX— (Continued)

APPENDIX I Page

Portions of United States Coast Guard Random,

Pre-Employment, and Reasonable Cause Drug Test-

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APPENDIX J

Rule BO.5 TE whee nike dik cncieseeie 8la

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APPENDIX A

Filed January 11, 1996

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No. 95-5027

Exxon SHIPPING COMPANY,

Appellant

v.

EXxON SEAMAN’S UNION

On Appeal from the United States District Court

for the District of New Jersey

(D.C. No. 93-cv-00689 )

Argued September 11, 1995

Before: SLOVITER, Chief Judge ALITO, Circuit Judge

and RENDELL, District Judge *

(Opinion Filed January 11, 1996)

OPINION OF THE COURT

* Hon. Marjorie O. Rendell, United States District Judge for the

Eastern District of Pennsylvania, sitting by designation.

|

2a

SLOVITER, Chief Judge.

Exxon Shipping Company appeals from a district court

order which declined to vacate and instead confirmed and

enforced an arbitration award reinstating an Exxon em-

ployee who had been discharged for refusing to submit

to a drug test. We will affirm.

I.

The collective bargaining agreement (“Agreement”)

between Exxon Shipping Company and Exxon Seamen’s

Union expired on August 31, 1987. After eight months

of negotiating for a successor agreement, Exxon, in a

letter sent on March 29, 1988 to all oceangoing employ-

ees, declared an impasse and advised the Union and its

members that Exxon’s final proposals would be imple-

mented on April 1, 1988.

The March 29 letter stated that the terms of the new

working relationship between Exxon and the Union would

include, inter alia, the company’s Drug and Alcohol Pol-

icy and any provisions of the expired Agreement that

were not part of the negotiations. That “Policy State-

ment on Employee Alcohol and Drug Use,” issued with

the March 29 letter, contained the following language:

Exxon Shipping Company may from time to time

conduct unannounced searches for drugs and alcohol

on owned or controlled property. The Company also

has the right to require employees to submit to medi-

cal evaluation or alcohol and drug testing where

cause exists to suspect alcohol or drug misuse. A

positive test result or refusal to submit to a drug test

is grounds for disciplinary action, including dismissal.

App. at 44 (emphasis added).

Exxon amplified its Drug and Alcohol Policy in a letter

sent to all oceangoing employees on September 27, 1988.

Exxon explained it would be aggressively enforcing its

a erry

sk li iii

3a

Alcohol and Drug Policy and gave “official notice” that

violation of the policy “will result in immediate termina-

tion from the vessel.” App. at 49-50 (emphasis in origi-

nal).

One of the terms of the Agreement remaining in effect

during the negotiations was a “Discipline” section, which

stated that “there will be posted . . . a list of rules which

shall constitute cause for which unlicensed personnel may

be discharged without further notice.” App. at 147 (em-

phasis added). Included on this list was “{i]nsubordina-

tion, including failure or refusal to perform work as-

signed.” App. at 128a. A provision of the Agreement

; providing for grievance and arbitration of disputes also

remained in effect.

The case before us stems from Exxon’s discharge of

Alan B. Cash, a thirteen-year employee who started with

Exxon as a seaman and advanced to chief pumpman.

The duties of a pumpman include loading and unload-

ing cargo and properly aligning pumps for the transfer

. of products. The parties do not dispute that it is a safety-

sensitive position and is subject to Coast Guard regula-

tions pertaining to drug testing.

On or about May i0, 1989, Cash was transferred from

the Exxon Benecia in Japan to the Exxon Washington,

anchored in San Francisco Bay. For the period of May

10-15, Cash resided in the second pumpman’s room of

the Exxon Washington. On May 15, the chief pumpman

of the Exxon Washington vacated the ship and Cash

moved into his room. On May 17, Exxon conducted an

unannounced drug search of all the rooms of the Exxon

Washington. Marijuana was discovered in various places

in the chief pumpman’s room which Cash had been

occupying for the last day and a half.

As a result of the search, Exxon requested that Cash

take a drug test. He refused. By letter dated June 6,

1989, Exxon discharged Cash, stating that he had vio-

4a

lated Exxon’s Drug and Alcohol Policy by refusing to

submit to a drug test after reasonable cause for testing

had been determined. The Union filed a grievance to

protest Cash’s discharge, and the dispute was eventually

submitted to arbitration before an arbitration panel of

three members, one appointed by Exxon, one by the

Union, and the third a neutral arbitrator who acted as

Chairman.

In an Opinion and Award dated November 27, 1992,

the Chairman made the following factual findings: A

“very small” amount of marijuana or marijuana residue

was found in the cabin used by Cash as of May 17, 1989.

This small amount was found in a number of places:

green leafy material in a desk and cabinet; ash on the

rug near the bed; seeds under the rug; and cigarette ends,

or “roaches,” in a pouch of a suitcase. App. at 91-92.

No traces of drugs were found in the quarters Cash pre-

viously occupied. Cash was in the room in which mari-

juana was discovered for only one and a half days and

for only a few hours daily during that period. A chief

pumpman and another pumpman used the cabin before

Cash moved into it, and other persons had access to the

room because the door was left unlocked. Cash did not

ask the utility men to clean his cabin because he did

not want to interfere with their shore leave.

Despite the marijuana found in Cash’s suitcase, the

Chairman found “it is not reasonable to attribute, by

clear and convincing evidence, ownership of the drug

materials in the cabin to Mr. Cash.” App. at 92. The

Chairman noted that there were no drugs found in Cash’s

previous room and that it was unlikely that in his short

time in the room he would have caused marijuana seeds

to be under the carpet. Jd. He also stated that “the

cabin had not been cleaned at the time of the search,

had been used by a number of persons in previous days,

and was open to others.” Jd. The Chairman concluded

that “[t]he circumstantial evidence certainly does not

|

point to only the one logical conclusion that the ma-

terial belonged to grievant,” and therefore there was no

“reasonable cause” under Coast Guard regulations to

demand a drug test. App. at 92-93.

! The Chairman next considered whether there was cause

to test Cash under the company policy. He remarked

that “(t]he matter of the suitcase is the weakest point

of Mr. Cash’s defense against the charge that he vio-

lated company policy by introducing marijuana into his

cabin.” App. at 93. Cash had stated at one point that

his wife had purchased the suitcase for him but testified

at the arbitration that he had acquired the suitcase on a

previous ship. The Chairman noted, however, that no

doubt had been raised that the suitcase was used before

Cash obtained it, and “[t]he undiscovered cigarette ends

could have been in the pouch no matter how the bag was

obtained.” Jd. He added that “[n]lo inference can be

drawn from the presence of the other marijuana in the

searched room that grievant put the ‘roaches’ in the bag.”

Id.

Finding the circumstantial evidence insufficient to

prove that Cash possessed marijuana, the Chairman de-

termined Cash could not be discharged for possession

under a “just cause” standard. App. at 94. He concluded

with the following passage:

We must come to an ex post conclusion about

whether there was cause to order a drug test. On

May 17, 1989, in light of what Mr. Newman and

his cohorts found, “cause” did exist... . The instant

review of the findings concludes, however, that even

though drug material was discovered in grievant’s

: cabin, sufficient question was raised about owner-

ship of the drugs so that “cause” “reasonable cause”,

“probable cause” or “just cause” did not exist to

order a test. And Mr. Shearer’s testimony estab-

lished that Mr. Cash’s appearance and actions pro-

vided no basis for ordering a test.

6a

The chairman concludes that if Mr. Cash had

taken the demanded drug test and then had grieved,

a later arbitration would have found that !ack of

“cause” “reasonable cause” “probable cause” or “just

cause” to have ordered a test on the basis of what

was found in the cabin would have led to reversal

of any discipline based on test resufts. This analysis

of the findings of the search shows that a test could

not have been ordered on the basis of what was dis-

covered in the cabin.

Id.

The Chairman did find, however, that Cash was insub-

ordinate in refusing to take the test, saying he “violated

the fundamental rule that . . . employees must first obey

an order and then grieve.” App. at 95. Nevertheless,

“since the order to take the drug test arose out of an

incorrect evaluation of the meaning of the marijuana

found in Mr. Cash’s cabin, discharge for failure to accept

the test is not possible.” Jd. The Chairman ordered re-

instatement with full seniority but without back pay.

The opinion was that of the Chairman of the Arbitra-

tion Panel. The Panel’s award was issued by the neutral

chairman and the Union appointed arbitrator who con-

curred with the award. The Company appointed arbitra-

tor dissented.

Exxon filed suit in district court pursuant to section

301(a) of the Labor Management Relations Act, 29

U.S.C. § 185, to vacate the arbitration award on the

following two grounds: 1) that enforcement of the award

would violate public policy; and 2) that the arbitration

panel exceeded its authority by reinstating Cash. Both

parties moved for summary judgment. The district court

granted the Union’s motion. The court found that be-

cause neither Exxon’s policy nor the Coast Guard regu-

lations mandate dismissal of an employee who refuses to

submit to a reasonable cause test, Cash’s reinstatement

did not violate public policy. The court also found that

Ja

the arbitrator acted within his authority in determining

that cause did not exist to discharge Cash. Exxon timely

filed a Notice of Appeal.

We have jurisdiction over the district court’s grant of

summary judgment under 28 U.S.C. § 1291. Our re-

view is plenary, and we apply the same standard the

district court should have applied in reviewing the arbi-

tration award. Stroehmann Bakeries, Inc. v. Local 776,

Int'l Bhd. of Teamsters, 969 F.2d 1436, 1440-41 (3d

Cir.), cert. denied, 506 U.S. 1022, 113 S. Ct. 660, 121

L.Ed.2d 585 (1992).

Il.

In its argument that the trial court’s order should be

upheld, the Union emphasizes the favored treatment given

arbitration awards in the courts. The Supreme Court has

frequently cautioned courts of the extremely limited role

they play in reviewing the decision of au arbitrator. See

United Paperworkers Int'l Union v. Misco, Inc., 484 U.S.

29, 36, 108 S. Ct. 364, 369-70, 98 L.Ed.2d 286 (1987).

It has said that “[t]he refusal of courts to review the

merits of an arbitration award is the proper approach

to arbitration «nmder collective bargaining agreements.

The federal policy of settling labor disputes by arbitra-

tion would be undermined if courts had the final say on

the merits of the awards.” United Steelworkers vy. Enter-

prise Wheel & Car Corp., 363 U.S. 593, 596, 80 S. Ct.

1358, 1360, 4 L.Ed.2d 1424 (1960). Thus, we must

enforce an arbitration award if it is based on an argu-

able interpretation of the collective bargaining agreement,

and we may only vacate an award if it is entirely unsup-

ported by the record or if it reflects a “manifest disre-

gard” of the agreement. News America Publications,

Inc. v. Newark Typographical Union, Local 103, 918

F.2d 21, 24 (3rd Cir. 1990).

On the other hand, under an exception to the general

rule, a court may vacate an award if it violates a “well

defined and dominant” public policy, discerned “ ‘by ref-

erence to the laws and legal precedents and not from

general considerations of supposed public interests.’ ”

W.R. Grace & Co. v. Local Union 759, 461 U.S. 757,

766, 103 S. Ct. 2177, 2183, 76 L.Ed.2d 298 (1983)

(quoting Muschany v. United States, 324 US. 49, 66,

65 S. Ct. 442-451, 89 L.Ed 744 (1945)); United Trans.

Union Local 1589 v. Suburban Transii Corp., 51 F.3d

376, 381 (3d Cir. 1995). Application of the public

policy exception requires a two step analysis. The thresh-

old question is whether a well defined and dominant pub-

lic policy can be identified. If so, the court must deter-

mine whether the arbitrator's award, as reflected in his

or her interpretation of the agreement, violated the public

policy. Exxon relies on the public policy exception on

this appeal, contending that in this case both questions

should be answered in the affirmative.

A

Exxon argues that the arbitrator’s reinstatement of

Cash following his refusal to submit to a drug test was

contrary to the well defined public policy against the oper-

ation of common carriers by individuals impaired by

drugs or alcohol. This court has twice recognized such

a policy in cases involving Exxon seamen. Exxon now

asks us to complete a “trilogy” by finding that reinstate-

ment of an employee in a safety-sensitive position who

refuses to submit to a chemical test violates that public

policy.

We first identified a broad public policy against per-

mitting an individual to operate a vessel while under the

influence of drugs or alcohol in Exxon Shipping Co. v.

Exxon Seamen’s Union, 993 F.2d 357 (3d Cir. 1993)

(hereinafter Exxon I}, which arose after an Exxon oil

tanker ran aground. Helmsman Morris Foster was among

the crew given a drug and alcohol test under Coast

Guard regulations and Exxon’s Alcohol and Drug Use

Policy. Exxon fired him on the basis of its drug policy

when he tested positive for marijuana. The arbitrators

decided that suspension was a more appropriate penalty

9a

than discharge, noting that there was insufficient evidence

indicating that Foster had used drugs at work and that

Foster had passed the Coast Guard drug screening level,

which was higher than Exxon’s. Jd. at 359-60.

The district court vacated the award, and we affirmed,

finding that the award requiring reinstatement violated

“a ‘well defined and dominant’ public policy against the

operation of a vessel under the influence of drugs or alco-

hol” reflected in the Coast Guard regulation. /d. at 362

(quoting W.R. Grace, 461 U.S. at 766, 103 S. Ct. at

2183). We referred to one regulation requiring that in-

dividuals testing positive for drugs “shall be denied em-

ployment . . . or removed from duties which directly

affect the safety of the vessel’s navigation or operations,”

46 C.F.R. § 16.201(c) (1990), and another prohibiting

those individuals from returning to work aboard a vessel

unless rehabilitation is shown, id. § 16.370(d) (1990).

993 F.2d at 364. We concluded that the purpose of the

Coast Guard regulations would be undermined and their

deterrence function undercut by the reinstatement of

Foster. Id,

We also noted that his reinstatement would be incon-

sistent with public policy as identified by other courts

that had vacated arbitral awards reinstating operators of

common carriers discharged for drug or alcohol use. See,

e.g., Delta Air Lines, Inc. v. Air Line Pilots Ass'n Int'l,

861 F.2d 665 (11th Cir. 1988) (vacating arbitration

award reinstating a pilot who flew a passenger airplane

while under the influence of alcohol), cert. denied, 493

U.S. 871, 110 S. Ct. 201, 107 L.Ed.2d 154 (1989);

Amalgamated Meat Cutters and Butcher Workmen vy.

Great Western Food Co., 712 F.2d 122 (5th Cir. 1983)

(vacating award reinstating tractor-trailer driver after he

overturned company truck while intoxicated).

In holding that the arbitrators’ award requiring rein-

Statement would violate public policy we declined to

accept the union’s argument that the public policy ex-

ception to enforcing an arbitrators’ award could only be

10a

applied when the award contravened a rule of positive

law. We found the broader test adopted by most of the

circuits to be “the sounder approach,” 993 F.2d at 363,

and noted that “the contours of positive law are broad

enough to include not just specific rules or prohibitions

but also the stated purposes behind the rules and pro-

hibitions.” Jd. at 364. We thus held that the award re-

instating Foster “violates the public policy protecting the

public and the environment against operation of vessels

by drug users.” /d.

We identified a similar public policy in Exxon Shipping

Co. v. Exxon Seamen's Union, 11 F.3d 1189 (3d Cir.

1993) [hereinafter Exxon IT\. Seaman Randall Fris was

observed in an impaired condition when he reported back

one evening to the Exxon Long Beach tanker. He was

discharged after a breathalyzer test disclosed a blood-

alcohol level in violation of both the company’s alcohol

policy and Coast Guard regulations. The arbitration

panel found that Fris had been intoxicated when he

boarded the ship but conciuded, over the dissent of the

company representative, that in light of Fris’ good record

he should have been given an opportunity to demonstrate

that his intoxication was an aberration. It thus reinstated

Fris with a 90-day suspension. Once again the district

court vacated the award, and we affirmed.

We held in Exxon II that there is a well defined and

dominant public policy “that an owner or operator of an

oil tanker should not be compelled to reinstate to a ‘safety-

sensitive’ position an individual who has been found to

be intoxicated while on duty on that vessel.” Id. at 1194.

We noted that under Coast Guard regulations, a crew

member who is intoxicated while on duty is guilty of a

crime under 33 C.F.R. § 95.055 (1993). Marine em-

ployers are prohibited from allowing an intoxicated indi-

vidual to “stand watch or perform other duties,” id.

§ 95.050(b), and must exercise “due diligence” to see

that the regulations concerning intoxication are not vio-

lated, id. § 95.050(a). tl F.3d at 1194-95. We em-

phasized the potentially disastrous environmental conse-

quences of an oil spill, and noted that statutes such as the

Clean Water Act, 33 U.S.C. § 1251 ef seq., and the Oil

Pollution Act of 1990, 33 U.S.C. § 2701 ef seq., evidence

a Congressional policy of protecting the environment

against oil spills in waters under federal jurisdiction. 11

F.3d at 1194. We also noted that Exxon faced potential

civil and criminal liability if an impaired Exxon employee

caused an accident. Jd. at 1195. Consequently, we con-

cluded that the federal policy favoring settlement of labor

disputes by arbitration must yield to the “well defined

and dominant policy that owners and operators of oil

tankers should be permitted to discharge crew members

who are found to be intoxicated while on duty.” /d. at

1196.

It is in light of our two previous Exxon cases that

articulate a strong public policy against the operation of

oil tankers and common carriers by crew members who

are under the influence of drugs or alcohol that we turn

to the somewhat different fact posture presented by this

appeal.

B.

Exxon argues that reinstatement of an employee who

refuses to submit to a drug test upon a showing of rea-

sonable cause violates the public policy identified in

Exxon I and Exxon I/ because it undermines enforcement

of the Coast Guard regulations and other laws animated

by that policy. Exxon does not argue that Cash’s refusal

to take a drug test under these circumstances violated

any positive law. In both Exxon / and Exxon Il we

acknowledged that another court of appeals had held that

an arbitration award could be overturned only when its

enforcement would cause a violation of positive law, see

Northwest Airlines, Inc. v. Air Line Pilots Assn Int'l,

808 F.2d 76, 83-84 (D.C. Cir. 1987), cert. denied, 486

U.S. 1014, 108 S. Ct. 1751, 100 L.Ed.2d 213 (1988);

American Postal Workers Union vy. United States Postal

Serv., 789 F.2d 1, 8 (D.C. Cir. 1986), whereas others

have opted for a broader approach that authorizes va-

12a

cating an award that is “inconsistent with some signifi-

cant public policy,” E.J. DuPont de Nemours & Co. v.

Grasselli Employees Indep. Ass'n, 790 F.2d 611, 616

(7th Cir.) (quoting Robert A. Gorman, Basic Text on

Labor Law 597 (1976)), cert. denied, 479 U.S. 853,

107 S. Ct. 186, 93 L.Ed.2d 120 (1986); see also United

States Postal Serv. v. American Postal Workers Union,

736 F.2d 822, 824 (list Cir. 1984). In United Paper-

workers International Union v. Misco, Inc., 484 U.S. 29,

108 S. Ct. 364, 98 L.Ed.2d 286 (1987), the Supreme

Court considered the breadth of the public policy excep-

tion but declined to resolve this split.

In favoring the broader approach in Exxon I, we stated

that “the distinction between an award which violates a

manifestation of positive law and an award which is ‘in-

consistent with public policy’ is often blurred.” 993 F.2d

at 363. We reasoned that “[w]here the ‘positive law’ is

a stated purpose behind a statute or regulation, to thwart

the purpose is to ‘violate positive law.’” Jd. at 364.

In Exxon Il, we clarified that in the earlier case we had

“expressly rejected” the argument that an arbitration

award may only be set aside when its enforcement would

violate a specific “positive law.” Exxon II, 11 F.3d at

1192. Accord United Transp. Union Local 1589 v. Sub-

urban Transit Corp., 51 F.3d 376, 381 (3d Cir. 1995).

The Union, although acknowledging that we opted for

a broader reading of the public policy exception in Exxon

I and JJ, argues that notwithstanding our broad language

in those cases we cited to and relied on positive law. It

notes that whereas reinstatement of the particular em-

ployees at issue in Exxon I and II would have violated

specific Coast Guard regulations or placed Exxon in

jeopardy of facing civil and criminal liability, there is no

regulation or statute that punishes the refusal of an em-

ployee to submit to a drug test that is based on “reason-

able cause.” It differentiates the Coast Guard regulations

that apply to post-accident testing, where the refusal to

submit “could subject the individual to susp’ sion and

l3a

revocation proceedings . . . and removal from any duties

which directly affect the safety of the vessel’s navigation

or operations,” 46 C.F.R. § 4.06-5(c) (1994), from those

applicable to an employee who refuses to submit to rea-

sonable cause drug testing, which only require the em-

ployer to enter the seaman’s refusal in the vessel’s official

logbook, if such a book is required, id. § 16.250(d).

Thus, the Union contends the regulations do not manifest

a public policy that would prevent reinstatement of an

who refuses to submit to a reasonable cause

The district court relied on this distinction to find that

dispute. To the extent that the district court held that the

parameters of public policy were limited by the extent to

which the Coast Guard regulations impose a penalty, it

misconstrued our holdings in Exxon I and IJ. In fact, in

Exxon I, Foster’s drug test was negative when evaluated

at the Coast Guard screening level, and thus Coast Guard

regulations did not require that his license be revoked.

993 F.2d at 358, 361. Nevertheless, we found that his

reinstatement would violate the public policy underlying

those regulations. Id. at 364.

A clearly defined and cautiously administered program

of drug testing, whether based on random testing or rea-

sonable cause, is the natural corollary to our earlier opin-

ions identifying a strong public policy that precludes al-

lowing intoxicated or drug-impaired seamen to remain in

safety-sensitive positions aboard oil tankers. We noted in

Exxon IT that “the statutes and regulations . . . convey the

unequivocal message that . . . an owner or operator [of

an oil tanker] should take every practicable step to en-

sure that an intoxicated crew member does not cause or

contribute to an oil spill.” 11 F.3d at 1195. The right

l4a

to test employees for alcohol or drug use upon a showing

of reasonable cause, on threat of discharge, is critical to

achieving the objective of the Coast Guard regulations

and of the environmental protection statutes we have

cited. Were employees permitted to refuse to submit to

such chemical tests, it is difficult to imagine why any

drug user would consent.

The federal government has manifested its strong sup-

port for drug testing of employees involved in mass trans-

portation through the promulgation by all federal agencies

governing mass transportation of regulations designed to

prevent drug use by employees in safety-sensitive posi-

tions. Such regulations in most instances equate refusal

to test with a “positive” test result. See, e.g., 14 C.F.R.

§ 121 .455(c) (1995) (Federal Aviation Administration ) ;

49 C.F.R. §§ 219.213, 219.505, 219.603(b) & (c)

(1994) (Federal Railroad Administration); 49 C.F.R.

§ 391.95(d) (1994) (Federal Highway Administration) ;

49 C.F.R. § 653.35(a) (1994) (Federal Transit Admin-

istration); 10 C.F.R. § 26.27(c) (1994) (Nuclear Regu-

latory Commission).

The force of our decisions in Exxon I and II would be

radically undermined if we declined to take the logical

next step and decide that reinstatement of an employee

who refused to submit to a drug test upon a showing of

reasonable cause violates public policy. Although Coast

Guard regulations do not mandate discharge for an em-

ployee—even one in a safety-sensitive position—who re-

fuses a drug test, we conclude that if Exxon had cause

to require a test, Cash’s reinstatement following his re-

fusal would violate public policy because it would under-

cut enforcement of Coast Guard regulations and environ-

mental statutes which denote a well defined and dominant

public policy against permitting intoxicated crew members

to operate oil tankers and other common carriers. Cf.

Local No. P-1236, Amalgamated Meat Cutters & Butcher

Workmen v. Jones Dairy Farm, 680 F.2d 1142, 1145

(7th Cir. 1982) (company rule forbidding employees

15a

from reporting health violations violated public policy be-

cause it hindered accomplishment of the goals of the Meat

Inspection Act).

c.

Exxon recognized that under its collective bargaining

agreement, the Union was entitled to grieve whether there

was reasonable cause to require Cash to submit to a drug

test. The Chairman found that Exxon lacked “cause” to

require Cash to submit to a drug test, but that Cash was

“insubordinate” for refusing to take the test. However.

because discharge for insubordination was not mandated

by the company policy, the Chairman determined that

discharge was too harsh a sanction, and the panel ordered

Cash reinstated without back pay.

In considering Exxon’s challenge to the arbitral award,

we do not review for legal error, but are limited to assess-

ing whether the award “draw{s] its essence from the col-

lective bargaining agreement.” W.R. Grace & Co. v. Local

Union 759, 461 U.S. 757, 766, 103 S. Ct. 2177, 2183,

76 L.Ed.2d 298 (1983). This standard is satisfied “ ‘if

the interpretation can in any rational way be derived

from the agreement, viewed in the light of its language,

its context and any other indicia of the parties’ intention:

only where there is a manifest disregard of the agreement,

totally unsupported by principles of contract construction

and the law of the shop, may a reviewing court disturb

the award.’” Super Tire Engineering Co. v. Teamsters

Local Union No. 676, 721 F.2d 121, 124 (3d Cir. 1983)

(quoting Ludwig Honold Mfg. Co. v. Fletcher, 405 F.2d

1123, 1128 (3d Cir. 1969) ), cert. denied, 469 U.S. 817.

105 S. Ct. 83, 83 L.Ed.2d 31 (1984). See also News

America Publications, Inc. v. Newark Typographical

Union, Local 103, 918 F.2d 21, 24 (3d Cir. 1990) (“A

court may not overrule an arbitrator simply because it

disagrees with the arbitrator's construction of the contract

or because it believes its interpretation of the contract is

better than that of the arbitrator.” (citation omitted ) ).

16a

Exxon argues that we should set aside the award be-

cause the arbitrator exceeded his authority in reinstating

Cash to his former position. In reviewing Exxon’s multi-

faceted challenge to the arbitral decision we may not

“second-guess{] the arbitrator’s fact-finding, particularly

insofar as the conclusion that the asserted public policy

would be violated by the employee’s reinstatement de-

pends on drawing factual inferences not made by the ar-

bitrator.” United States Postal Service v. National Ass’n

of Letter Carriers, 839 F.2d 146, 148 (3d Cir. 1988).

1. The Cause Requirement

Exxon argues that in interpreting the company drug

policy’s requirement that “cause” support a drug test, the

Chairman impermissibly inserted a “clear and convincing”

evidence of ownership standard, and employed an “ex

post” analysis to assess whether cause existed. The Union

responds that the quantum of proof required in such cases

is unsettled, but that where the offense charged is one that

is punishable by law, such as drug possession, arbitrators

have commonly held employers to a “clear and convinc-

ing” or “beyond a reasonable doubt standard.” Brief of

Appellee at 35 (citing Frank Elkhouri & Edna Asper

Elkouri, How Arbitration Works 661-63 (4th ed. 1985)).

It further maintains that neither the parties’ contract nor

the company’s Drug and Alcohol Policy defined “cause,”

identified a standard of proof to be employed, or specified

at what point in time “cause” must exist; therefore, these

determinations were within the province of the arbitrator.

We agree. The parties bargained for an arbitrator to

interpret their contract. The Exxon Drug and Alcohol

Policy states: “{t]he Company . . . has the right to re-

quire employees to submit to medical evaluation or al-

cohol and drug testing where cause exists to suspect al-

cohol or drug misuse.” App. at 44 (emphasis added). The

term “cause” is ambiguous. Where a contractual am-

biguity exists it is within the province of the arbitrator

to interpret the ambiguous phrase. Suburban Transit

17a

Corp., 51 F.3d at 380-81. Although the Chairman’s opin-

ion may not be a model of clarity, it is evident that he

ultimately concluded that Exxon lacked “cause” to re-

quire Cash to submit to a drug test. That Exxon now

disagrees with that conclusion is not a ground for vacat-

ing his decision. Exxon could have defined “cause” more

specifically in its policy, or could have bargained with the

union to remove cases arising under its drug policy from

the jurisdiction of arbitrators altogether. It did not, and

therefore may not now be heard to complain that the ar-

bitrator lacked authority to make determinations that the

company policy and the parties’ agreement left open for

an arbitrator’s judgment.

2. Change of Discipline

Exxon next argues that the arbitrator lacked authority

to reinstate Cash because the company’s September 28,

1988 letter clearly notified employees that termination

was the penalty for violation of the Drug and Alcohol

Policy. But the Drug Policy requires only that employ-

ces submit to testing “where cause exists.” The arbitra-

tor concluded that it did not; accordingly, based on his

findings, the arbitrator did not exceed his authority.

Exxon further maintains that the arbitrator lacked au-

thority to change the discipline for a finding of insubordi-

nation, and in doing so exceeded his power to interpret

the contract. The arbitrator found that Cash’s refusal to

take the drug test was insubordinate. Although company

rules permit Exxon to discharge an employee for insubor-

dination, the arbitrator believed that under these circum-

Stances a discharge would conflict with the requirement

that “cause” support an order to take a drug test.

This situation is analogous to the one we faced in Super

Tire, 721 F.2d 121. In that case, drinking alcohol dur-

ing work hours was characterized in the parties’ contract

as a cause for “immediate dismissal.” Jd. at 122. Yet

dismissal also required “just cause.” Id. The arbitrator

18a

determined that although the employee had been drinking

during work hours, dismissal was too harsh a punishment

because the employee had not been warned that the com-

pany would strictly enforce its policy. We reversed the

district court's order vacating the arbitrator’s determina-

tion because we concluded that the terms of the contract

were not so clear as to foreclose the arbitrator's inter-

pretation that a warning was required. Jd. at 125.

In Super Tire, we relied on our earlier decision in

Arco-Polymers, Inc. v. Local 874, 671 F.2d 752 (3d.

Cir.), cert. denied, 459 U.S. 828, 103 S. Ct. 63, 74

L.Ed.2d 65 (1982). There, a clause in the employment

contract provided for discharge of employees absent from

work for four consecutive days without good cause.

Another section provided that employees shall be dis-

charged only for “just cause.” Jd. at 753. The arbitrator

reinstated an employee who had been terminated for be-

ing absent from kork for 19 days without good cause.

The district court vacated the award. We held that the

district court erred because “[i]Jt cannot be said with

absolute certainty . . . that discharge under this section is

‘strictly a function of management.’” Jd. at 756 (quoting

United Steelworkers v. Warrior & Gulf Navigation Co.,

363 U.S. 574, 584, 80 S. Ct. 1347, 1354, 4 L.Ed.2d

1409 (1960) ).

Similarly here, the Agreement stated that insubordina-

tion “shall constitute cause for which unlicensed personnel

may be discharged.” App. at 147 (emphasis added).

The subsequent September 1988 letter warned that the

company’s Drug and Alcohol Policy would be strictly

enforced. The policy included the provision that employ-

ees must submit to drug testing “where cause exists.”

App. at 44. The Chairman found that reading these

provisions together, the “just cause” standard still applied,

and because Exxon lacked cause to test Cash, discharge

for insubordination would be inappropriate. As in Super

Tire and Arco, we cannot say that the arbitrator’s read-

19a

ing of the contract is implausible and that his decision to

reinstate Cash was beyond the bounds of his authority.

3. Interpretation of Coast Guard Regulations

Exxon also contends that the arbitrator exceeded his

authority by interpreting Coast Guard regulations, be-

cause an arbitrator’s decision must be based exclusively

on the collective bargaining agreement. In light of the

fact that the Chairman based his decision on the terms

of the collective bargaining agreement, even though he

referred to the Coast Guard regulations, see App. at 93,

we have no occasion to consider whether, as Exxon

claims, the Chairman interpreted the regulations incor-

rectly.

4. Reasonableness of Arbitrator’s Findings

Finally, we consider whether the Chairman’s finding in

this case that Exxon lacked “cause” to order Cash to take

a drug test was so unreasonable that it would violate

public policy to enforce his award. The Chairman found

that there was marijuana or marijuana residue in numer-

ous places in the cabin Cash was using. Specifically,

there was green leafy material in a desk and cabinet, ash

on the rug, seeds under the rug, and two butts of mari-

juana, referred to as “roaches,” in a suitcase pouch. The

Union emphasized Cash’s minimal association with that

room, in that Cash had been assigned there less than two

days before and had spent only a few hours there because

he was working long shifts elsewhere on the ship.

At oral argument, Exxon argued that where, as here,

a matter of public policy is involved, the arbitrator’s find-

ings should be held to a higher standard of scrutiny and

set aside if unreasonable. We find no authority for vacat-

ing an arbitral award on such grounds. On the contrary,

an arbitrator’s decision need be neither wise nor internally

consistent. In fact, arbitrators have no obligation to ex-

plain their reasons for an award or even to write an opin-

ion unless the contract so requires. Virgin Islands Nurs-

20a

ing Association’s Bargaining Unit v. Schneider, 668 F.2d

221 (3d Cir. 1981); see also United Steelworkers v.

Enterprise Wheel & Car Corp., 363 U.S. 593, 598, 80

S. Ct. 1358, 1361-62, 4 L.Ed.2d 1424 (1960). Arbi-

trators’ decisions are subject to a standard of only “mini-

mal rationality.” Virgin Islands Nursing, 668 F.2d at 223

(quoting Robert A. Gorman, Basic Text on Labor Law

586 (1976)). Although we will vacate an award if we

find that the award itself violates public policy, the public

policy exception does not lessen our deference to ani ar-

bitrator’s factual findings.

The Supreme Court has made clear that findings of

fact and inferences to be drawn therefrom are the exclu-

sive province of the arbitrator. United Paperworkers Int'l

Union v. Misco, Inc., 484 U.S. 29, 36, 44, 108 S. Ct.

364, 369-70, 374, 98 L.Ed.2d 286 (1987). That

a court “is inquiring into a possible violation of public

policy [does not] excuse a court for doing the arbitrator’s

task.” Id. at 45. Thus, this court may not refuse enforce-

ment even if we consider the evidence sufficient to prove

that reasonable cause existed to require Cash to submit

to a drug test. Exxon challenges the reasonableness of

the arbitrator’s conclusions, but “[nJo dishonesty is al-

leged; only improvident, even silly, factfinding is claimed.”

Id. at 39, 108 S. Ct. at 371.

It is not our role to draw inferences that the factfinder

did not. We therefore will not disturb the arbitrator’s

finding that “cause” did not exist to require Cash to sub-

mit to a drug test. Accordingly, because we accept the

arbitrator’s finding that Cash was ordered to submit to a

test without reasonable cause, his reinstaterent does not

offend public policy and the decision of the arbitrator

must be enforced.

Ill.

For the foregoing reasons, the order of the district

court will be affirmed.

2la

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No. 95-5027

EXXON SHIPPING COMPANY,

Appellant

Vv.

EXxON SEAMAN’S UNION

On Appeal from the United States District Court

for the District of New Jersey

(D.C. No. 93-cv-00689)

Present: Sloviter, Chief Judge, Alito Circuit Judge, and

Rendell, District Judge*

JUDGMENT

This cause came on to be heard on the record from the

United States District Court for the District of New J ersey

and was argued by counsel September 11, 1995.

On consideration whereof, it is now here ordered and

adjudged by this Court that the judgment of the said

District Court entered on December 12, 1994, be, and the

same is hereby affirmed. Costs taxed against appellant.

*Hon. Marjorie O. Rendell, U.S. District J udge for Eastern

District of Pennsylvania, sitting by designation.

22a

All of the above in accordance with the opinion of this

Court.

Dated: January 11, 1996

Attest:

s/ P. Douglas Sisk

Clerk

|

:

’

’

'

23a

[Filed Dec. 8, 1994]

APPENDIX B

UNITED STATES DISTRICT COURT

DISTRICT OF NEW JERSEY

Chambers of

NICHOLAS H. POLITAN

Judge

NOT FOR PUBLICATION

December 8, 1994

LETTER OPINION

ORIGINAL ON FILE WITH CLERK OF THE COURT

Re: Exxon Shipping Company

v. Exxon Seamen’s Union

Civil Action No. 93-698 (NHP)

Dear Counsel:

This matter comes before the Court on a motion of

defendant Exxon Seamen's Union for summary judgment

pursuant to Fed.R.Civ.P. 56 to confirm and enforce an

arbitration award. Plaintiff Exxon Shipping Company

opposes the motion, and cross-moves for summary judg-

ment to vacate the arbitration award. For the reasons

stated herein, defendant's motion for summary judgment

is GRANTED, and plaintiff's cross-motion for summary

judgment is DENIED.

STATEMENT OF FACTS*

Exxon Shipping Company (“Exxon”) operates Amer-

ican Flag ships and other vessels on the high seas and on

*The Court’s recitation of the facts of the dispute is derived

from the Opinion of the Neutral Chairman of the Arbitration

Board dated November 27, 1992.

24a

the inland waterways of the United States. Exxon Sea-

men’s Union (“Union”) is the sole and exclusive collec-

tive bargaining representative of all unlicensed personnel

employed by Exxon in the deck department, the engine

department, and the steward’s department on-board

Exxon’s vessels. Exxon and the Union were parties to a

collective bargaining agreement (“CBA”) that had an

effective date of July 31, 1985, and which was to expire

on August 31, 1987. Prior to and after the expiration

of the 1985-87 CBA, the parties negotiated for a successor

agreement. On March 29, 1988, Exxon declared an im-

passe in negotiations, and advised the Union and its mem-

bers that Exxon’s final proposals would be implemented

effective April 1, 1988. All the terms of the 1985-87

CBA that were not part of the negotiations were to be

continued in full force and effect.

At all times after April 1, 1988, the discipline clause

from the 1985-87 CBA was in effect. The clause indi-

cated that an employee could be discharged only for

“cause”. The terms and conditions that were implemented

effective April 1, 1988 also contained a grievance and

arbitration provision. The provision provided for a two-

step process culminating in arbitration before an Arbitra-

tion Board, composed of one representative of Exxon, one

representative of the Union, and a neutral arbitrator sit-

ting as chairperson.

The grievant in this case is Alan B. Cash (“Cash”).

Cash was employed by Exxon for approximately thirteen

years. He started with Exxon as a seaman and worked

his way up to chief pumpman. It is agreed by the parties

that the responsibilities of a chief pumpman include

moving cargo on and off ships and properly aligning

pumps for the transfer of products. On or about May 10,

1989, Cash was assigned to the oil tanker Exxon Wash-

ington, anchored in San Francisco Bay. Prior to that

date Cash was stationed on the ship Exxon Benicia in

Japan. For the period of May 10-15, 1989, Cash was

ee

25a

quartered in the second pumpman’s room on the Exxon

Washington.

On May 15, 1989, the chief pumpman of the Exxon

Wask. ‘>n left the ship on a family emergency. That

day, Cash was assigned to the chief pumpman’s room.

The room was not cleaned before it was occupied by

Cash. For fire safety reasons, all rooms on the Exxon

Washington were left unlocked and were accessible to

cleaning personnel and members of the crew. Accordingly,

Cash ordinarily left his cabin door unlocked. During

May 15-17, 1989, Cash worked almost around the clock.

On May 17, 1989, Exxon conducted an unannounced

drug search of the Exxon Washington. All the rooms of

the ship were searched. During the search of the chief

pumpman’s room—then Cash’s quarters—the search team

and their dogs discovered portions of a marijuana plant

in a desk drawer, marijuana ash by the bed post, several

marijuana seeds under the carpeting, and two marijuana

cigarette butts, or “roaches”, in the pouch of a suitcase.

As a result of the search, Exxon requested that Cash

take a drug test. Cash refused, and was subsequently

discharged. By letter dated June 6, 1989, Exxon advised

Cash that he was terminated for violations of Exxon’s

policy on alcohol and drug use; that he was in possession

of illegal substances; and that he refused to submit to a

drug test. The Union filed a grievance to protest Cash's

: discharge. When the parties were unable to resolve the

grievance informally, the dispute was submitted to arbi-

tration before an Arbitration Board (“Board”). During

these proceedings, Cash's testimony regarding the luggage,

in which thé marijuana roaches were discovered, varied.

First, Cash stated that the luggage was a gift from his

wife. Later, Cash asserted that the luggage was not his,

but rather that he took it from a store room on his previ-

ous ship without inspecting it first. Furthermore, Cash

testified that he did not clean the chief pumpman’s room

before occupying it or any time thereafter.

iii

26a

In an Opinion and Award dated November 27, 1992,

the Board found that Exxon did not have “cause” to dis-

charge Cash, and ordered him reinstated without back

pay.” The Board ruled as follows:

. . . in absence of any drugs in grievant's previous

room, the probabilities are greater that Mr. Cash

did not introduce the marijuana into his cabin prior |

to the search of May 17, 1989 than that he did. |

If there was no reasonable cause to conclude that

grievant brought the drug into the cabin—and the

above analysis finds that there was not—then the

Coast Guard regulations would not call for a drug

test, and no violation of the regulations could be said

to exist. The question of whether there was cause

under the company policy will be considered below.

The matter of the suit case is the weakest point of

Mr. Cash’s defense against the charge that he vio-

lated company policy by introducing marijuana into

his cabin. (Even in light of this, the higher Coast

Guard standard of “reasonable cause” could not be

met because of a) previous occupancy of the room,

b) lack of drugs in grievant’s previous room, and

c) the other considerations discussed above. The

lower company standard conceivably might have been

met by the suitcase materials. )

Mr. Cash was either incorrect when he told the

PRC that his wife purchased the suitcase for him

or when he testified at the arbitration that he acquired

the suitcase on the Exxon Benicia. Since no doubt

has been cast on his assertion that when he got the

piece it was used, that weakness of testimony may

make no difference. The undiscovered cigarette ends

2 The decision not to award back pay was based on the Board's

finding that Cash had been insubordinate in refusing to take a

drug test. The Opinion stated that the “grievant violated the

fundamental rule that except when an order imperils health or

safety, employees must first obey an order and then grieve.”

a

si nia e Sila ial ii alae

27a

could have been in the pouch no matter how the bag

was obtained... .

Still, there is doubt how the “roaches” got in the

bag. No inference can be drawn from the presence

of the other marijuana in the searched room that

grievant put the “roaches” in the bag. The chairman

has found that there is considerable doubt Mr. Cash

brought the other drug traces into the cabin. The

most that can be said about the butts in the bag is

| that they would be strongly suspicious in the absence

of the contrary circumstantial evidence about the

other materials found... .

We must come to an ex post conclusion about

whether there was cause to order a drug test. On

| May 17, 1989, in light of what Mr. Newman and

| his cohorts found, “cause” did exist. (That will cre-

ate problems about grievant’s refusal to take the test

: even if the above discussion raises question[s] con-

cerning the basis for the test order.) The instant

| review of the findings concludes, however, that even

| thsugh drug material was discovered in grievant's

cabin, sufficient question was raised about ownership

of the drugs so that “cause,” “reasonable cause,”

, “probable cause” or “just cause” did not exist to

order a test. And Mr. Shearer’s testimony estab-

lished that Mr. Cash’s appearance and actions pro-

vided no basis for ordering a test.

The chairman concludes that if Mr. Cash had

taken the demanded drug test and then had grieved,

a later arbitration would have found that lack of

“cause,” “reasonable cause,” “probable cause,” or

“just cause” to have ordered a test on the basis of

what was found in the cabin would have led to

reversal of any discipline based on [the] test results.

[In light of this finding, the chairman ruled that]

. grievant violated the fundamental rule that

lll ait ” ———

er ee ae

SaaS

28a

except when an order imperiis health or safety, em-

ployees must first obey an order and then grieve... .

Opinion of Arbitration Board (Nov. 27, 1992). As a re

sult of these findings, the Board’s award reinstated Cash

without back pay.

On February 18, 1993, Exxon filed suit against the

Union in the United States District Court, District of New

Jersey, arguing that the award violated well defined and

dominant public policy, and that the Board exceeded its

authority. The Union now moves for summary judgment

pursuant to Fed.R.Civ.P. 56 to confirm and enforce the

arbitration award. Simultaneously, Exxon cross-moves for

summary judgment to vacate the award.

DISCUSSION

A. Standard of Review for Summary Judgment Motions

Under Fed.R.Civ.P. 56, summary judgment may only

be granted if, drawing all inferences in favor of the non-

moving party, there is no genyine issue of material fact

and the movant is entitled to judgment as a matter of law.

See Chipollini v. Spencer Gifts, Inc., 814 F.2d 893, 896

(3d Cir.), cert. dismissed, 483 U.S. 1052 (1987). The

burden of proof is on the moving party to demonstrate

the absence of a genuine issue of material fact. See Celo-

tex Corp. v. Catrett, 477 U.S. 317 (1986). If this burden )

is satisfied, the non-moving party is saddled with the obli-

gation of identifying specific facts which illustrate that

there is a genuine issue for trial. See Matsushita Elec.

Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (1986).

In the case at bar, the arbitrator’s findings of facts may

not be disturbed. The question of whether there are

grounds to vacate an arbitration award is a question of

law. Accordingly, this matter is appropriately resolved

on motion for summary judgment pursuant to Fed.R.Civ.

P. 56.

sateen

NE TS Sete sortie

29a

B. Standard of Review for Arbitration Awards

According to well settled law, courts have only a

limited power to review a labor arbitration award insti-

tuted pursuant to a collective bargaining agreement.

Stroehmann Bakeries, Inc. v. Local 776, Int'l Brotherhood

of Teamsters, 969 F.2d 1436, 1441 (3d Cir.), cert. de-

nied, U.S. ——, 113 S. Ct. 660 (1992). “The

federal policy of settling labor disputes by arbitration

would be undermined if courts had the final say on the

merits of the awards.” United Paperworkers Int’l Union

v. Misco, Inc., 484 U.S. 29, 36 (1987), quoting United

Steelworkers of Amer. v. Enterprise Wheel & Car Corp.,

363 U.S. 593, 596 (1960). “As long as the arbitration

award ‘draws its essence from the collective bargaining

agreement,” and is not the arbitrator's own brand of

justice, a court may not vacate the award. /d., quoting

Steelworkers, 363 U.S. at 597. This is true even if the

court finds the basis for the award to be ambiguous or

disagrees with the board’s findings, contract interpreta-

tions, or choice of remedies. /d. at 36-[3]8. “A reviewing

court is ‘bound—under all except the most limited cir-

cumstances—to defer to the decision of the arbitrator,

even if that decision finds the facts and states the law

erroneously.’” Phoenix Newspapers, Inc. v. Phoenix

Mailers Union Local 752, 989 F.2d 1077, 1080 (9th

Cir. 1993); see also Exxon Shipping Co. v. Exxon Sea-

men's Union, 801 F. Supp. 1379, 1384 (D.N.J. 1992)

(citation omitted) (“Fris”). Accordingly, this Court be-

gins its analysis with the presumption that the Board’s

award is valid.

C. The Public Policy Exception

The Supreme Court has recognized a narrow exception

to the general unwillingness to tamper with arbitrators’

awards in labor contexts. See Misco, 484 U.S. at 43,

relying on W.R. Grace & Co. v. Local 759, Int'l Union

of United Rubber Workers, 461 U.S. 757, 766 (1983).

a i,

30a

A court may refuse to enforce an arbitrator’s award

where it would violate an explicit, well defined and

dominant public policy which is ascertained “by reference

to the laws and legal precedents and not from general

considerations of supposed public interests.” Jd., quoting

Muschany v. United States, 324 U.S. 49, 66 (1945).

The public policy exception is triggered when enforce-

ment of an arbitration award would compel one party

to take action which conflicts with a well defined and

dominant public policy. Brown v. Ruascher Pierce

Refsnes, Inc., 994 F.2d 775, 782 (11th Cir. 1993) (cita-

tion omitted). “{T]he critical inquiry is not whether the |

underlying act for which the employee was disciplined :

violates public policy, but rather whether there is a public

policy barring reinstatement of an individual who com-

mitted the wrongful act.” Stead Motors v. Automotive

Machinists Lodge No. 1173, 886 F.2d 1200, 1215 (9th

Cir. 1989) (en banc) (emphasis in original), cert. de-

nied, 495 U.S. 946 (1990), citing W.R. Grace, 461 US.

at 766; see also Monroe Auto Equip. Co. v. International

Union, 981 F.2d 261, 269 (6th Cir. 1992) (citation |

omitted), cert. denied, US. , 113 S. Ct. 2396, |

reh’g denied, U.S. , 113 S. Ct. 3066 (1993).

While notions of public policy are to be ascertained

by reference to positive law and not from general con-

siderations of the public interest, the Third Circuit has

nevertheless adopted an expansive view of what consti-

tutes positive law. See Exxon Shipping Co. v. Exxon

Seamen’s Union, 993 F.2d 357, 364 (3d Cir. 1993)

(“Foster”). In Foster, the Third Circuit ruled that “the

contours of positive law are broad enough to include

not just specific rules or prohibitions but also the stated

purposes behind these rules or prohibitions.” /d.

In the matter presently before the Court, Exxon sub-

mits that reinstating Cash to his former position would

conflict with a well defined and dominant public policy

of continuing employment of a person who refuses to

aa

3la

submit to a drug test. Exxon asserts that this public

policy is embodied in two sources. The first is the drug

and alcohol policy promulgated by Exxon.* Exxon’s pol-

icy, however, did not mandate that employees who re-

fused to submit to drug tests be discharged. Exxon’s

policy, reflected in its letter dated March 29, 1988, only

stated that dismissal was a possibility. Therefore, in con-

trast to Exxon’s assertion that the Board ignored the

CBA, the Board followed Exxon’s policy by denying Cash

back pay.

The second source of public policy upon which Exxon

relies is the United States Coast Guard ( “USCG”) regu-

lations. See 46 C.F.R. § 16. Exxon asserts that the

USCG regulations demand that a seaman’s refusal to be

tested equates to a positive test result. See 46 C.F.R.

§ 16.250. The USCG regulations establish pre-

employment, random, post-accident, and reasonable cause

testing requirements. However, the only penalty provi-

sions providing for discharge are found in the USCG

regulations governing post-accident testing, see 46 C.F.R.

§§ 4.06-05, 4.06-10, and where a crew person tests posi-

tive for an illegal substance, see 46 C.F.R. § 16.201(c).

A Re UR AL NE eee tl hd ae Ae Ne A te el OIE a am

* Exxon points to cases, from this and other circuits, where

courts have declined to enforce arbitration awards that rein-

stated employees discharged for being impaired on the job. In

this case, however, it was never alleged that Cash was under the

influence of a controlled substance. In fact, the Board determined

that there was no reasonable cause to even conclude that Cash

was in possession of marijuana.

Wat acine

* Exxon’s policy provides:

The Company also has the right to require employees to

; submit to medical evaluation or alcohol and drug testing where

; cause exists to suspect alcohol or drug misuse. A positive test

result or refusal to submit to a drug test is grounds for dis-

ciplinary action, including dismissal.

q Letter from Exxon to the Union and its members, dated March

29, 1988 (emphasis added).

| rane _

32a

In contrast, under the USCG regulations for reasonable

cause testing,’ the only penalty provided for when the

individual refuses to submit to the test is that his or her

name is entered into the vessel’s official log book. 46

C.F.R. § 16.205(d). Therefore, Exxon’s reliance on the

USCG regulations for the argument that a well defined

and dominant public policy precludes the reinstatement

of Cash is misplaced.

D. Arbitration Board Did Not Exceed Its Authority

Finally, Exxon asserts that the Board’s award must be

vacated because it does not draw its essence from the

CBA. Exxon argues that the Board, in reaching its deci-

sion, exceeded its authority by interpreting certain USCG

regulations, rather than the CBA. The Union contends

that the Board did not exceed its authority by ordering

that the grievant be reinstated without back pay.

A federal court “may only set aside an arbitrator’s

award interpreting a CBA when the interpretation can-

not be said to be in any rational way derived from the

agreement.” Teamsters Union Local No. 115 v. DeSoto,

Inc., 725 F.2d 931, 934 (3d Cir. 1984); see also Super |

Tire Engineering Co. v. Teamster Local Union No. 676,

721 F.2d 121, 123-24 (3d Cir. 1983), cert. denied, 469

U.S. 817 (1984). Additionally, a highly deferential |

standard of review is extended to the arbitrator’s sub-

stantive decision as to what constitutes reasonable cause

for discharge. Interstate Brands Corp. v. Chauffeurs, 909

F.2d 885, 889 (6th Cir. 1990) (citation omitted), cert.

5 The USCG regulations governing reasonable cause testing pro-

vide that an employer may only order a crew person for a drug

test based upon a “reasonable and articulate belief that the in-

dividual has used a dangerous drug based upon direct observation

of specific, contemporaneous, physical, behavioral or performance

indicators of probable use.” See 46 C.F.R. § 16.250(b). In the

present case, the Board determined that reasonable cause did not

exist under the USCG regulations to order Cash to submit to a

drug test.

33a

denied, 499 U.S. 905 (1991). “In the absence of an

unambiguous provision in the agreement mandating dis-

missal . . ., [the court] will not set aside an arbitrator’s

decision to review a dismissal in light of the mix of

factors that make up just cause.” Super Tire, 721 F.2d |

at 125.

In the instant case, the parties bargained for an arbi-

trator to tell them what was “just cause” for discharge

and what was not. The Board gave full consideration to

the parties’ agreements and interpreted the meaning of

the combined agreements. Pursuant to its authority, the

Board fashioned a remedy in accordance with the juris-

diction with which it was vested. Accordingly, the Board

did not exceed its authority when it determined that in

this case, just cause did not exist to discharge Cash.

In consenting to the Arbitration Board’s jurisdiction

over this dispute, Exxon agreed to have the Board inter-

pret the collective bargaining agreement and to fashion

an appropriate remedy. The Board construed the agree-

ment and, upon due deliberation, found that Cash’s dis-

charge was improper. In ordering Cash reinstated with-

out back pay, the Board fashioned an appropriate remedy.

Furthermore, the Board’s award does not violate any well

defined or doininant public policy.

CONCLUSION

. For the foregoing reasons, the summary judgment mo-

tion of defendant Exxon Seamen’s Union is GRANTED,

and the cross-motion for summary judgment of plaintiff

Exxon Shipping Company is DENIED.

An appropriate Order accompanies this Opinion.

ete ee OS

/s/ Nicholas H. Politan

NICHOLAS H. POLITAN

U.S.D.J.

A eee

34a

[Filed Dec. 8, 1994]

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF NEW JERSEY

Civil Action No. 93-689

Hon. NICHOLAS H. POLITAN

Exxon SHIPPING COMPANY,

a Delaware Company,

Plaintiff,

v.

Exxon SEAMEN’S UNION,

Defendant.

ORDER

This matter having come before the Court on a motion

of defendant Exxon Seamen’s Union for summary judg-

ment pursuant to Fed.R.Civ.P. 56 to confirm and enforce

an arbitration award, and the cross-motion for summary

judgment pursuant to Fed.R.Civ.P. 56 of plaintiff Exxon |

Shipping Company to vacate the arbitration award, and

the Court having considered the matter and the submis-

sions of the parties, and for the reasons appearing more

particularly in the Letter Opinion of this Court; and

good cause having been shown.

IT IS on this 8th day of December, 1994,

ORDERED that the motion of defendant Exxon Sea-

men’s Union is GRANTED, and the cross-motion of

plaintiff Exxon Shipping Company is DENIED, and the

Complaint is hereby DISMISSED.

/s/ Nicholas H. Politan

NICHOLAS H. POLITAN

U.S.D.J.

[Entered on Docket 12-12-94]

a ns ae ee nn

oT gi eg eRe Edin ARI Smt Le ia

35a

APPENDIX C

IN THE MATTER OF THE ARBITRATION BETWEEN

Exxon SEAMEN’S UNION

and

EXXON SHIPPING COMPANY

TERMINATION OF ALAN B, CASH

Opinion of

Neutral Chairman

Award of Panel

Panel of Arbitrators:

Maurice C. Benewitz, Neutral Chairman

William P. Hoeler, Company Appointed Arbitrator

Howard A. Goldoerger, Esq., Union Appointed Arbi-

trator

Appearances

For the Union: Howard A. Goldberger, Esq., Counsel

For the Company: Albert R. Galik, Esq., Counsel

Three hearings were held by the panel of arbitrators

on July 16, 1991, January 22, 1992 and April 16, 1992

at Newark, New Jersey to hear and consider a contro-

versy concerning the termination of Pumpman Alan B.

Cash. The parties were unable to agree on a submission.

After full consideration of the testimony, evidence and

argument, the chairman concludes that the usual language

for a disciplinary discharge fairly would allow both par-

ties to present their evidence and submit their arguments.

Therefore, he finds and rules that the issue presented

should read:

36a

Was the discharge of Alan Cash for just cause? If

not, what shall be the remedy?

In such a disciplinary proceeding, the burden lies upon

the employer who effected the discharge.

The hearings were transcribed. Briefs were submitted

by the parties. After the chairman had read the briefs

and reviewed the record, he held a telephonic conference

call with the other members of the panel. Thereafter, the

proceedings were closed and the instant opinion and

award was written.

The opinion is solely that of the chairman. The award

is that of the chairman and of those members of the

arbitration panel who sign as concurring.

The Contract

At the time this grievance arose, the collective bargain-

ing agreement dated effective July 31, 1985 (Ex. J-1)

had expired. On March 29, 1989, the company declared

an impasse in bargaining for a successor contract (Ex.

C-1). Management stated that its final offer, with certain

exceptions, would be implemented on April 1, 1988.

Some amendments to continuing provisions in the expired

contract also appeared.

The Policy Statement

Included with the promulgated materials was a policy

statement on drug and alcohol abuse. The first paragraph

read as follows (emphasis applied by chairman):

Exxon Shipping Company is committed to a safe,

healthy, and productive work place for all employees.

The Company recognizes that alcohol, drug, or other

substance abuse by a few employees will impair

their ability to perform properly and can have seri-

ous adverse effects on the safety, efficiency, and pro-

ductivity of other employees and the Company as a

whole. The misuse of legitimate drugs or the use,

37a

possession, distribution, or sale of illicit or unpre-

scribed controlled drugs on Company business or

premises is strictly prohibited and is grounds for

termination. Possession, use, distribution, or sale

of alcoholic beverages on Company premises is not

allowed without prior approval of appropriate senior

management. Being unfit for work because of use

of drugs, or alcohol is strictly prohibited and is

grounds for termination of employment. While this

policy refers specifically to alcohol and drugs, it is

intended to apply to all forms of substance abuse.

The fourth paragraph read (emphasis applied by

chairman):

Exxon Shipping Company may from time to time

conduct unannounced searches for drugs and alcohol

on owned or controlled property. The Company also

has the right to require employees to submit to

medical evaluation or alcohol and drug testing where

cause exists to suspect alcohol or drug misuse. A

positive test result or refusal to submit to a drug

test is grounds for disciplinary action, including

dismissal.

fhe material also included guidelines for application

of the policy. by masters, captains, managers and super-

visors. The first 2 paragraphs read (emphasis applied by

chairman):

1. At the discretion of the President or Fleet Man-

ager, the Company may conduct unannounced

alcohol and drug searches on owned or controlled

property where there is reasonable cause to sus-

pect that these substances may be present. Rea-

sonable cause may include searches in operations

where use of these substances could create an

unsafe situation.

38a

2. The decision to require an employee to submit

to testing for drugs and alcohol requires the ad-

vance endorsement of the Human Resources Man-

ager. Prior to any testing, the employee must

sign an Informed Consent form. In cases where

a medical evaluation is deemed appropriate, med-

ical personnel should be asked to collect a urine

and/or blood sample for testing to determine the

presence of alcohol and/or drug. Blood tests will

not be taken on board ship by vessel personnel.

If circumstances prevent medical evaluation from

being conducted soon after the “for cause” inci-

dent, the Management may collect and properly

process the urine sample.

Thereafter, in compliance with an opinion and award

of Arbitrator Daniel F. Brent (AAA Case No. 18 30 0062

85N) the company on September 27, 1988 issued a notice

to all employees (Ex. C-4). The writing reiterated the

policy and guidelines noted above. The writing cited

Coast Guard regulations prohibiting operation of a vessel

while intoxicated. The company gave further notice that

violation of the Company Alcohol and Drug Use

Policies, or regulations governing alcohol or drug

use in the work place will result in immediate termi-

nation from the vessel . . . termination of employment

is the penalty for violation of these standards.

[The union, until after the events involving Mr. Cash,

did not concede that the company had the power to issue

and enforce this policy in its various forms. The union

officials advised the members not to take drug tests when

ordered to do so by company officials. Such advice was

given to the grievant, Mr. Cash. These matters will be

considered below. ]

39a

Prior Awards

In addition to the Brent award cited in the September

27, 1988 document discussed above, the parties sub-

mitted 4 other awards dealing with alleged drug or alco-

holic problems. For reasons which will be discussed

below, the awards of panels chaired by Arbitrators Her-

bert L. Marx, Jr., David N. Stein, and Martin F. Shein-

man are inapposite. The dispute before Arbitrator Joan

Parker had many resemblances to that here at issue.

So the Parker award will have to be considered carefully.

The grievant in the case before the Marx panel was

found to have been impaired by alcohol. This was an

announced reason for termination of employment, the

panel ruled. The grievant in the instant matter, Mr.

Cash, was not charged with being under the influence of

either alcohol or drugs and so the Marx award is not

really applicable. Nor can the arbitrator substitute his

judgment where rules and penalties are posted.

The award does make several statements which may

have some relevance. The award finds that while the drug

and alcohol policy refers to testing, the policy “leaves

the option for such testing to the Company.” The Coast

Guard regulations allow the ship’s master to rely on

. observation or on a chemical test at his option.

The grievant in the case decided by the Stein panel

had, in June 1988, completed an inpatient program treat-

ing cocaine addiction. This occurred under the company’s

confidential counselling program. The grievant then was

assigned to a ship and was suspended 6 months later

for failure to report to duty for circumstances not beyond

his control. The drug and alcoholism program was re-

viewed with the grievant.

The grievant was expected to report for assignment on

April 20th after another assignment and leave. But he

was directed to report to the company earlier because his

wife had called in to say she believed he was involved

40a

with drugs. The reason given to grievant for calling him

in was to discuss his next assignment. When he reported,

he was asked to take drug and alcohol tests and agreed

to do so. At the time of the tests, grievant admitted using

drugs and the tests so demonstrated. After consideration,

grievant was discharged.

The company contended that under its policy, a test

could be administered for “cause” rather than for “prob-

able cause” or “reasonable cause,” i.e., for a “reasonable

suspension.”

Arbitrator Stein found that under Paragraph 1 of the

Guidelines for implementation of its policy, the com-

pany had committed itself to a reasonable cause standard

for searches or for testing of individuals. The words “for

cause” in Paragraph 2 were found to refer back to the

words in Paragraph 1.

Furthermore, the Coast Guard documents cited by the

company, refer to “reasonable cause.” Whatever the

standard, it was ruled, the company lacked it. The med-

ical information was privileged and should not have been

used. The wife’s information was unreliable. Nor had

the grievant used drugs on company property, it was

found. For all these reasons, the arbitrator ruled that the |

positive drug test results should be suppressed. Thus there

was no just cause for the discharge. The issue of back pay

was remanded with the arbitrator retaining jurisdiction.

The situation at issue was insufficiently similar to that

involving Mr. Cash for the Stein award to be of assistance

in the instant matter. Mr. Cash was not charged with

using or being under the influence of alcohol or drugs.

In the dispute before the Scheinman panel, cause prop-

erty was found to test the grievant; and he tested positive

for marijuana although there was question whether he

ingested it on company property. The facts again were

ST SE

4la

strongly differentiated from those concerning Mr. Cash

who never was found to have used marijuana.

Dr. Parker considered 2 discharges for alleged viola-

tion of company Rule 14 which prohibited introduction,

possession or use on company property of alcohol or

illegal drugs. Two ships were searched by contractors

using detection dog.

In the room of one grievant, a homemade pipe con-

taining marijuana was found. The room of the other

grievant contained a hand-rolled cigarette butt and an

alligator clip which both tested positive for marijuana.

Both grievants denied that the discovered materials be-

longed to them. Individuals had been admitted into the

locked room of one grievant to measure for new carpet-

ing. The second grievant had lived in the room for only

8 days between September 20th and October 26th be-

cause the room was being renovated. Since this grievant

had been worked 12 to 16 hours after moving in, he

allegedly had been unable to clean the room. He did

find and keep the alligator clip which had been present

‘When he moved into the room. The union noted that the

rooms had been occupied by employees who were on

leave and who had left their belongings. In addition,

workers had been in the rooms to renovate them. The

doors of the rooms often were not locked. One of the

grievants refused on union advice to take a drug test.

Dr. Parker ruled on two aspects of this dispute. One

concerned the validity of the drug and alcohol policy and

the method of enforcing it. Since that issue was not

raised in the Cash arbitration, the instant chairman will

not consider that portion of the Parker award.

Dr. Parker ruled on the “central issue” of

the grievants’ “actual” or “constructive” possession

of the marijuana discovered in their rooms.

An employee may be held responsible for marijuana

found in his room if he had reason to know that others

42a

might have left the marijuana there, the arbitrator ruled.

But there would be no violation of the company rule for

the same employee if someone placed the drug in the

room without his knowledge. In cases based on circum-

stantial evidence only, that evidence “must lead to one

and only one logical conclusion,” Dr. Parker wrote.

Due to rules on fire safety, room doors are left un-

locked. Many different persons worked in the rooms

while they were being refurbished and could have left

materials behind before the grievants took possession.

Thus the grievants did not have exclusive control of their

rooms, the arbitrator concluded. Others could have en-

tered and left behind small amounts of marijuana.

The evidence provided room for doubt about whether

the grievants had possessed the marijuana, the arbitrator

ruled. Because of problems with mitigation, reinstate-

ment was not accompanied by full back pay.

The Dispute

On May 17, 1989, Alan Cash, the grievant, was a

pumpman on the Exxon Washington, a tanker in the

company’s fleet. The vessel was at anchor in San Fran-

cisco Bay.

William G. Newman, a contractor who was assisted by

an agent of his company, used 2 canines, Tuit and Mo,

to search the vessel for drugs on May 17th (T. I. 83).

Mr. Newman has a background as a law enforcement

officer who worked in the area of narcotics detection.

He testified to extensive training in the identification of

drugs (T. I, 63-65). The witness used chemical field

tests in identification of marijuana (T. I, 66). Among

the other skills the witness has learned and taught

is the methodology in the use of the Becton Dickenson

Duquenois-Levine test which is utilized in field testing for

marijuana (Ex. C-7) (T. I, 78).

43a

On May 17, 1989, the search team personnel and the

dogs were introduced to the ship’s crew. The crew was

searched before the vessel’s areas were examined (T. I,

130-131). The living quarters and other areas of the

vessel then were searched. When the room of Mr. Cash

was examined, grievant was present as well as the tem-

porary ship’s representative Taylor Kissinger (T. I, 85-

86). The search in Mr. Cash’s room was the same as in

the other areas and included (T. I, 87)

all of the cabinets, desks, the restroom, suitcases,

any personal item in the room, also the ceiling, the

bed, everything in the room.

Items allegedly associated with marijuana were dis-

covered. The dogs both were used and gave alerts (T.

89-90). Green plant material was found in a cabinet

drawer and in the desk (T. I, 91). This was placed in

an evidence bag and an identifying notebook sheet was

put in the bag (T. I, 96). Two cigarette ends or

“roaches” were found in a suitcase pouch and were placed

in an evidence bag with an identification notebook sheet.

Grievant had stated the suitcase was his (T. I, 98). Green

ash was discovered by the bedpost and was bagged and

labeled (T. I, 100-101). Marijuana seeds were found—

according to the testimony (T. I, 101)

in various: areas of the room’ under the carpet ‘and

then also on the carpet.

These seeds were bagged and had an identifying paper

written (T. I, 101).

{When field tests were perforined in the captain’s quar-

ters, identification sheets were written by Mr. Newman.

The information on these sheets (Exs. C-8, C-9, C-10)

was transcribed from the notebook sheets placed in the

3 evidence bags (T. I, 103). The chairman noted at the

hearing and again repeats that the contemporaneous writ-

ing (Ex. C-9) differed somewhat from the testimony in

describing the location where the marijuana seeds were

44a

found, i.e., “l. various areas under the carpet”. (Em-

phasis applied by chairman. ) ]

The ends of the cigarettes were examined microscopi-

cally and by application of the Duquenois-Levine test.

They were identified positively as marijuana (Ex. C-8).

The seeds and green ash material were identified by micro-

scopic examination (Ex. C-9). And the green plant ma-

terials from cabinet and desk were identified by both

microscopic examination and chemical test (Ex. C-10).

In each case, only part of the material was used. The

remainder was sealed in the plastic bags. Red evidence

tape was used (T. I, 111). (See Exs. C-14, C-15, C-16).

The bags then were sealed in a “Federal Express envelope

or box” and sent to an independent laboratory in Fort

Collins, Colorado for a confirming GMS test (T. [1 12).

The ash material was tested at the independent labora-

tory and not by Mr. Newman (T. I. 124).

[The cross of this witness and of Robert K. Lantz,

Ph. D. of the Rocky Mountain Instrumental Laboratories

raised chain-of-custody questions as well as other issues.

The chairman will not review this aspect of the case be-

cause the decision in the dispute will not turn on such

questions. The chairman is satisfied from the field tests—

and from the laboratory tests as well, setting aside chain-

of-custody questions—that the materials found in Mr.

Cash’s room contained, or were, marijuana. The ques-

tion on which this opinion will turn is whether Mr.

“ash was shown to be the person responsible for the

marijuana in that room.]

On cross, Mr. Newman testified that he was told a) that

Mr. Cash had previously occupied another room and

b) that someone else previously had occupied the room

Mr. Cash was in at the time of the search (T. I, 138-

139). The room Mr. Cash had occupied before moving

to the cabin in question had been examined. The Newman

team examined all of the rooms. The team “had found

nothing in any of the other rooms .. .” (T. I, 139).

45a

(The Canine Detection Incorporated identification sheets

(C-8), (C-9), (C-10), were again introduced through

Dr. Lantz. The exhibits at the time of readmission (Exs.

C-14, C-15, C-16) had evidence bags attached. These

bags contained seeds or small amounts of other material.

As the chairman already has noted, the evidence of Dr.

Lantz, through whom these exhibits entered, will not be

reviewed here. ]

Further Company Testimony

Grady T. Shearer, III, a west coast personnel specialist,

was involved in the May 17, 1989 search of the Exxon

Washington (T. III, 5-6). Mr. Shearer testified that al!

the rooms and common areas were searched (T. III, 7).

Ship’s representative Taylor Kissinger was invited to go

along with the search team, the witness stated. Mr. Kis-

singer was present when Mr. Cash’s room was searched

(T. III, 8-9). (The search process was explained. But

in light of the chairman’s conclusion that marijuana in-

deed was found in grievant’s room, this description need

not be reviewed. The same remark is appropriate with

regard to the description of the testing process in the

captain’s quarters. )

Mr. Shearer did testify that while the testing was going

on, Mr. Cash sometimes was in the room and sométimes

was not. “He came in and out” (T. III, 21-22). Taylor

Kissinger was present throughout the testing (T. III, 25).

The ship’s representative signed the evidence tape on each

specimen bag after Mr. Newman sealed it (T. III, 31).

When he was informed of the positive results of the

field tests by Mr. Newman, Mr. Shearer contacted Acting

Human Resources Manager David Walker in Houston to

obtain permission to require a drug test from Mr. Cash

(T. HI, 33). After Mr. Walker concurred, the manage-

ment personnel on the ship were informed, and grievant,

46a

with Mr. Kissinger present, was told he would be required

to take tests for drugs and alcohol. Mr. Cash would not

agree to be tested (T. III, 34).

Grievant was informed that his refusal would lead to

discharge from the vessel and probably from the company

(T. 34-35). Mr. Kissinger called the union. Grievant

again refused and was discharged from the vessel, paid

some monies due him, and sent ashore (T. III, 35).

Prior to the search, Mr. Shearer testified on cross, no

one aboard the ship was charged with being under the in-

fluence of or of using or possessing drugs. Nor could the

witness say that from his observation, Mr. Cash either

was under the influence of or used drugs (T. III, 44).

The witness also said that what was detected in Mr.

Cash’s room was “the only thing we found, yes” (T. III,

44) [in the vessel. ]

Mr. Shearer emphasized that grievant was told he had

no choice about taking the test. When asked whether

there would have been no discharge if Mr. Cash had

taken a test which was negative, the witness said cz. ©

45)

I don’t know. That’s speculative.

I don’t know what would have happened.

On recall, the witness insisted that he told Mr. Cash

several times of the consequences of not taking the drug

test (T. IIT, 246).

On cross it developed that while a vessel search had

been scheduled for the period around May 17, 1989, the

Exxon Washington was selected as the ship to be searched

because another crew member had reported finding a

hand rolled cigarette upon joining the vessel on May

10th (Ex, U-2) (T. Il, 53).

Mr. Shearer was aware that several weeks after the

incident, i.e., June 2, 1989, (See Exs. J-2A, U-4), the

union offered the company the opportunity to test Mr.

Cash (T. III, 59).

47a

In May 1989, David Walker was the labor relations

coordinator for Exxon Shipping Company and also was

acting human resources manager. (The manager, Dan

Paul, was in Valdez, Alaska) (T. III, 74).

On May 17, 1989, Mr. Walker was informed by Mr.

Shearer of the vessel inspection. The witness was told

that dogs had alerted during the search of Mr. Cash’s

room aud that materials which tested as marijuana were

found (T. III, 95-96): The company’s policy as well

as the requirements in the Coast Guard regulations were

that such a finding constituted reasonable cause to require

a drug test (T. III, 96). The witness authorized the test.

He later learned of grievant’s refusal to take the test.

This led to discharge from the vessel (T. III, 97).

A meeting of the personnel relations committee, which

grievant and his union representative declined to attend,

was held on June 5, 1989, Mr. Walker testified. The

witness did have a telephone conversation on June Sth,

with John Farrell, a member of the union’s board of

governors (T. IIT, 98).

The personnel relations committee had a report from

the search committee about what was found. It had the

subsequent independent laboratory report. In light of the

facts that all employees had been informed of the com-

pany policy and that Mr. Cash had refused to take the

drug test, discharge was recommended. (Mr. Farrell told

Mr. Walker that grievant was willing to take the test on

June Sth. The offer earlier had been made by Mr.

Farrell to the company’s labor relations analyst, Jeanne

Kraus). (T. IIIf, 104). Mr. Cash was terminated after

the committee recommendation (T. III, 109).

The reason the offer to take the test was refused was

that it allegedly would not have given a good indication

of drug use as of May 17th, and because Mr. Cash had

been obligated to take the test at the time he was directed

to do so on May 17th (T. III, 105).

48a

When the chairman asked, Mr. Walker said that a neg-

ative outcome on the test would have been a mitigating

factor. The witness did not say that such a negative re-

sult would have been dispositive (T. III, 106-108).

On cross, it developed that Mr. Farrell on June 2nd

had told Ms. Kraus that Mr. Cash would take the test

(T. III, 118).( See Ex. J-2A.)

On recall, Mr. Walker testified that during PRC meet-

ing of June 5, 1989, he spoke by speaker phone to Mr.

Cash and Mr. Farrell who were at the union offices in

New Jersey.

Mr. Cash said that before he joined the vessel the suit-

case in which the hand rolled cigarette ends were found

was purchased by his wife at a used store (T. III, 256).

Nothing was said in this call about any alleged drug

test that Mr. Cash took after leaving the vessel (T. III,

257).

Union Testimony

Alan Cash testified to his career at the company which

culminated in his sailing as a chief pumpman. His eval-

uations showed only one adverse notation (in 1977) on

his work (Ex. U-1).

Grievant testified that he never had any contact with

or possession of drugs (T. III, 126).

At the beginning of May 1989, Mr. Cash was as-

signed to the Exxon Washington. There was another

chief pumpman aboard (T. III, 127).

Mr. Cash testified that he took the suitcase in which

the marijuana cigarette ends were found from the oilskin

locker on the Exxon Benicia in 1988 or at the end of

1987. It was somebody else’s suitcase which grievant

took because he needed additional carrying space. He

continued to use it after taking it and never noticed “any-

thing out of the ordinary inside of it” (T. III, 128-129).

49a

When grievant boarded the Exxon Washington, the

other chief pumpman was still there and did not leave

until 2 days befcre the search. Prior to Mr. Cash’s mov-

ing into that room, he was in another which he said was

really a storage room and was the old second pumpman’s

room (T. III, 119-130). The chief pumpman’s quarters

were preferable; so grievant moved into them when the

prior occupant, Joe Victorio, left (T. III, 130-131).

Nothing was found in the space he previously had oc-

cupied so far as Mr. Cash knew (T. III, 131).

Utility men clean the rooms. But the one at issue

had not yet been cleaned. The ship was in port, and Mr.

Cash did not wait for the cleaning to be done. Instead,

he moved in at once (T. III, 133). Grievant left the door

unlocked as he always did (T. III, 135).

On May 17, 1989, after the vessel anchored, the crew

was gathered and told of the search, grievant testified.

The search was done with dogs. Mr. Cash had partici-

pated in such searches before (T. III, 136).

When grievant’s room was searched, Mr. Newman, his

associates, the dogs, Mr. Shearer and Mr. Kissinger were

present as well as Mr. Cash (T. ITI, 138). Grievant was

shown 2 seeds which were found under the carpet (T.

III, 139). Nothing else was shown to Mr. Cash until

the searchers reached the closet area (T. III, 141).

Grievant agreed that the suitcases in the closet could be

searched. In a pouch, “Two little balled-up pieces of

paper were found” (T. III, 141). They were described

to grievant as marijuana cigarette ends—‘“roach ends”

(T. III, 142). The cigarette ends and 2 seeds were all

that was shown to Mr. Cash before the captain confined

him to his quarters as the party went midship to run

tests (T. ITI, 144).

Thereafter, grievant was called to the captain’s office

to be told the test results. The captain was present as

were Managers McDonald and Shearer, Mr. Kissinger

and Mr, Newman (T. III, 145).

50a

Mr. McDonald stated that the tests were positive for

marijuana. Grievant was told that he was required to

take a drug test. If he took it, he would be terminated

from the vessel and later told his employment status.

If he did not, he would be terminated from the ship and

probably the company. (The transcript, ITI, 146 was

supplemented by the chairman's notes to articulate the

answer. )

Grievant told the managers he wanted to talk to some

member of the union's board of governors. He was not

allowed to use the telephone (T. III, 147). [The chair-

man notes that Mr. Kissinger, who could have testified

on this and about other points where grievant's state-

ments differed from those of company witnesses, was not

called. ]

Mr. Cash rejected the test. Grievant knew the union

had not agreed to accept such testing (T. III, 148-149).

He so informed the captain (T. III, 154). Mr. Cash was

terminated from the vessel, went ashore, and reached his

home on May 18, 1989 (T. III, 137). He contacted

Mr. Farrell of the board of governors 2 or 3 days later

(T. If, 158). Mr. Farrell told Mr. Cash to take the

drug test (T. IIT, 160).

About a week and one-half after his discharge from the

vessel, Mr. Cash testified, he went to Smith, Klin &

French Laboratories and took a drug test. Cindy William-

son, a technician, orally informed grievant, who did not

ask for a writing at the time, that the test result was

negative (T. III, 161). Grievant later attempted to ob-

tain a writing but never was able to do so (T. III, 166).

[The chairman reiterates his remark made at the hearing

that Mr. Cash’s testimony on this point constituted hear-

say.]

Grievant testified that before, during and after May

1989, he never ingested drugs (T. III, 166). He is pre-

pared to take a drug test at any time (T. III, 169).

Sla

Grievant swears that what was found aboard the ship was

not his (T. III, 170).

[Facts were elicited about Mr. Cash’s post discharge

attempts to earn monies. As will become apparent below,

this evidence is not relevant to the chairman's decision of

the dispute and will not be reviewed.]

On cross, it was developed that Mr. Cash served on the

Exxon Benicia, the vessel from which he allegedly took

the suitcase, in 1986 (T. III, 171).

At the time of the search, Mr. Cash testified on cross,

he made no statement that he obtained the suitcase on

the Exxxon Benicia (T. III, 181). He said nothing about

the suitcase in the captain’s quarters, either (T. III, 187).

Mr. Cash testified that he never conferred with Taylor

Kissinger in the captain’s quarters. Mr. Kissinger was

present, however (T. ITI, 183). Mr. Kissinger was given

permission to use the telephone and attempted to call

the board of governors. The ship’s representative could

not reach anybody (T. III, 184). Mr. Kissinger never

gave Mr. Cash advice as to what to do, grievant stated

when the chairman inquired (T. III, 186).

The company did not give Mr. Cash several opportuni-

ties to change his mind about taking the test, he testified

(T. IIT, 188).

The test results from Smith, Kline & French came in

about 3 days after Mr. Cash took the test, he said. Griev-

ant did not report the negative result to the company, but

he may have told Mr. Farrell (T. III, 200).

Despite the fact that Mr. Cash may have said on June

5, 1989 that his wife bought the suitcase before he joined

the Washington, actually grievant obtained the suitcase

on the Benicia, he insisted on cross (T. ITI, 207). Griev-

ant remembered telling the PRC that his wife bought the

bag, but he was wrong, he stated (T. III, 211).

52a

On redirect, Mr. Cash again said that the suitcase was

a used bag and that the cigarette ends were not his (T.

III, 224). He also stated that in the 2 days he was in

the room, he worked 36 hours, i.e., 18 hours each day

(T. Ill, 237).

Position of the Company

The company submits that its April 1, 1988 policy

statement permitted tests when “cause exists to suspect

alcohol or drug misuse.” This policy and Coast Guard

regulations on the subject were emphasized in the Sep-

tember 27, 1988 letter in which, as permitted by the

Brent award, official notice of the policy issued. “Term-

ination of employment” was set forth as the penalty for

violation.

The pertinent November 21, 1988 Coast Guard regula-

tions requiring chemical testing are cited. The April 28,

1989 Coast Guard reasonable cause requirement is noted:

“evidence of use is sufficient to require testing.” Drugs

or drug paraphernalia in clothing or staterooms were de-

fined as “physical indicators.”

The search of the Exxon Washington then is reviewed.

Mr. Newman’s testimony about finding the drugs in griev-

ant’s room is noted. The company submits that pursuant

to its policy Mr. Cash was directed to be tested and re-

fused to accede.

On the basis of its own policy of April 1, 1988 and

on the basis of the Coast Guard regulations, there was

ground to require testing. The company policy allows

tests where “cause to suspect . . . drug misuse” exists.

The Coast Guard regulations permit testing where a sea-

man “is reasonably suspected” of drug use.

Arbitrator Parker upheld the right of the company to

conduct unannounced searches of vessels. An experienced

and trained expert, Mr. Newman, conducted the search,

found suspected material in Mr. Cash’s room, and estab-

53a

lished by field chemical tests and microscopic analysis

that the material was marijuana, the company maintains.

This led to the demand for a test.

Despite the argument of the union against requiring

such tests, the Newman discoveries and field tests pro-

vided a reasonable suspicion of drug misuse under the

company policy, it is asserted. The policy uses the words

“cause .. . to suspect” rather than “probable cause” or

“reasonable cause” it is noted. Arbitral authority is cited

to show that presence of “rational grounds for testing

. .., not whim or caprice” is sufficient to permit testing.

Such grounds would exist even in the absence of impair-

ment, it has been found, so long as the employer was not

“arbitrary, capricious, malicious, or discriminatory.”

Here the company had cause to suspect Mr. Cash, it

is contended.

Finding marijuana not only in the room but also

in the grievant’s suitcase established a reasonable

suspicion of drug use.

Finding the marijuana in the personal belongings of

grievant constituted a physical indication of use under the

Coast Guard regulations, it is further submitted. The

presence of the “roaches” in the suitcase is stressed. The

employer is obligated to comply with Coast Guard regula-

tions, it is asserted.

Since Mr. Cash refused to take the drug test, he vio-

lated the company policy and was subject to discharge

under it, employer submits. And under the Coast Guard

regulations [which do not set forth discharge as a penalty],

grievant was obligated to accept a test when reasonably

suspected of using marijuana. The company on Septem-

ber 27, 1988 stated that violation of Coast Guard regula-

tions would result in termination {but that termination

would arise under cOmpany policy and not Coast Guard

regulation.] The Coast Guard regulations established a

basis for testing even if, as grievant believed, such testing

had not been bargained with the union.

54a

In any case, no union testimony was received showing

that Mr. Cash was told to refuse the test or that testing

‘iad not been bargained. Mr. Cash ignored the rule “obey

now, grieve later.” Arbitral authority is cited to show

that discharges arising from refusals to take drug tests

have been sustained.

Mr. Cash’s testimony did not explain or justify his re-

fusal to take the test, the company contends.

Grievant never previous to the arbitration said he ob-

tained the suitcase on the Exxon Benicia. If he did ob-

tain it there, that would have occurred in 1986. But he

had told the PRC his wife purchased the suitcase just

prior to his boarding the Exxon Washington. Allegedly,

“neither story is credible and neither should be believed.”

In any case, finding the drugs in the suitcase was

cause for testing, it is asserted. “The order to test was

justified regardless of where the roaches in the suitcase

came from.” And other drugs were found in his room.

It is unlikely, the company charges, that someone else

left drugs in the room and also that someone else left

drugs in the suitcase.

Allegedly, by agreeing to be tested in June, Mr. Cash

and the union acknowledged that the company had cause

to test him. [The chairman notes that the acknowledge-

ment could have been that the company had the unilateral

power to require a test whether or not there was cause.]

Grievant had received the company policy letter and was

presumed to know the Coast Guard regulations.

The company challenges the drug test “story” offered

by grievant. [The chairman agrees that this account was

hearsay unsupported by any documents or witnesses. In

coming to a decision, the chairman will not credit griev-

ant’s allegations. Hence he will not further review the

company contentions concerning it.]

55a

The offer to take a test on June 2nd and June Sth

did not mention the Smith, Kline & French test, it is

noted. The later offers were “unreasonable”.

Where Mr. Cash’s testimony contradicted that of

Messrs. Shearer and Newman, grievant should not be be-

lieved, the company submits. He was not credible con-

cerning the suitcases, and the other witnesses corroborated

each other at a number cf points. Furthermore, Mr.

Kissinger was not called.

The company notes that arbitral authority holds the

chairman may not substitute his judgment as to penalty if

he finds the charges are proved. The prior opinion of

Arbitrator Marx is cited.

Since Mr. Cash violated the Coast Guard regulations,

public policy dictates that he should not be reinstated,

the company submits.

Discharge is the only penalty appropriate for the viola-

tion of both company policy and Coast Guard policy by

refusing to take the drug test, the company submits. Ar-

bitrator Marx ruled in reviewing the company’s posted

rules that an arbitrator cannot alter a previously an-

nounced and applicable penalty.

The company asks the chairman to deny the grievance.

Position of the Union

The union submits that in charging Mr. Cash, the com-

pany ignored its own January 18, 1989 evaluation of

“exceptional” in a number of areas including “personal

hygiene habits” and “principles of general shipboard san-

itation.”

The discharge, it is noted was based on 2 considera-

tions: drug substances found in grievant’s quarters and

personal belongings; and his refusal to take the drug test.

Yet when the company continued those sections of the

predecessor contract which had not arisen in bargaining,

the section on termination for “cause” was retained. Past

56a

practice and arbitration awards have held that this means

“just cause,” it is asserted. Thus, the union argues, dis-

cipline must be “fair and just,” and rules must be “reason-

able in . . . scope and applications.”

The union notes the distinction in the drug policy lan-

guage. This makes use or possession of drugs on com-

pany property “grounds for termination.” But it states

that refusal to submit to a drug test is “grounds for

disciplinary action. . .” At various places the policy re-

fers to “disciplinary action which may include termina-

tion.” The just and fair cause language retained in the

contract allegedly requires that discipline arising under

the drug policy must be considered with reference to the

just cause standard, it is asserted.

One of the basic positions of the Union in this case

is that using the standards evolving out of the con-

tract language and, indeed, the policy statement,

a refusal to consider progressive discipline or to take

action other than discharge is an unfair and unjust

application of discipline.

The Union notes that Mr. Cash was in the room for

1% days at the time of the search. The chief pumpman

had left on emergency leave. And, as in the case de-

cided by Arbitrator Parker, the rooms were open for

access by many persons. At a later point, the union

emphasizes that the search was precip[it]ated by Seaman

Byrd’s finding someone else’s possible marijuana cigarette

in his newly assigned room.

The union repeats Mr. Cash’s contention that he took

the suitcase from the changing room on the Exxon

Benicia.

The propriety of a search of personal effects without

a search warrant is questioned. {Mr. Cash testified that

he agreed to the search of the suitcase, and he did not

testify that he was under “duress.” The Parker award

found that such searches could be conducted, and arbitra-

tors have ruled similarly under other contracts. ]

57a

It is argued: there was no proof of the age of the

material in grievant’s room. In whatever way Mr. Cash

got the suitcase, it was “used” by someone else before

him. The objects were tiny and would probably have

escaped grievant's notice, it is contended. The items were

of such minute quantity as not to justify use of the word

“possession” of drugs, the union asserts.

Nothing, it is noted, was found in the room grievant

previously had used for a much longer time. It was in-

consistent that no marijuana was found there if Mr. Cash

was using the drug. Allegedly

it is impossible to conclude that Cash justifiably,

should be saddled with [the room’s] contents partic-

ularly in view of the . . . . limited amount of ma-

terial found.

Mr. Cash had not yet cleaned the room; the door was

left unlocked; and grievant worked 36 hours in the 112

days he had the room.

{The chairman shall not review the challenges concern-

ing the search, handling, tests and transfer of the material

found. As earlier stated, the chairman is satisfied that

drug materials were found. The chairman will emphasize

that despite the testimony, the contemporaneous data sheet

shows that the marijuana seeds were found under the

carpet. |

With regard to the failure to take the drug test, the

union offers a number of contentions.

It notes that the requirement to take the test was the

subject of a bitter company-union dispute. Mr. Cash

knew the union’s position and had been told to refuse

testing. He informed the captain the test had not been

bargained. Board of Governors Member Farrell insisted

that grievant refuse the test. Mr. Farrell later apologized

for doing so.

Allegedly, it was unfair to discharge a person caught

in the midst of this union-company dispute.

58a

Mr. Farrell, when reached by grievant, promised to

contact the company to say Mr. Cash would take the

test. By the date of the June Sth PRC meeting, Mr.

Farrell had done so. The company refused the offer de-

spite knowing that marijuana remains in the body at least

15 days according to the company’s own expert at the

Foster hearing. It is noted that the company’s position

as stated by Mr. Walker was that Mr. Cash was required

to take the test and that no later offer to do so would be

exculpatory. Allegedly, this company position in light

of the dispute with the union over testing was funda-

mentally unfair.

When the chairman asked, the company never said that

a negative test would change the outcome, the union

notes.

Among other arguments the union submits that

Neither the Company's policy nor the Coast Guard

require discharge for refusing to take a test even

where cause exists.

Since the company policy identifies refusal of a test as

“grounds for disciplinary action including dismissal”, Ar-

bitrator Scheinman, in Foster, found that even a positive

result does not require discharge, and he set one aside.

The PRC, it is charged, refused Mr. Cash’s offer to

take a test which the committee could have considered.

Nor was weight given to grievant’s “previous excellent

and consistently highly rated work history of some 13

years.”

The union further charges that Mr. Cash’s fundamental

rights were denied when he requested and was denied the

right to call a member of the board of governors. Griev-

ant’s testimony remains unrebutted since Mr. Shearer

could not recall if grievant made the request or whether,

if the request was made, it was refused.

The union asks reinstatement of Mr. Cash with full

back pay and benefits.

re

f

59a

Discussion

The chairman credits the testimony of Mr. Newman

that marijuana or marijuana residue was found in the

cabin used by Mr. Cash as of May 17, 1989. It is highly

significant that no traces of the drug were found in the

quarters used by grievant between May 10 and May 15,

1989.

The union contends that only a very small amount of

drug was found, in any case. Apparently this is true.

But what was found was discovered in a number of

places: green leafy material in desk and cabinet; ash

on the rug near the bed; seeds under the rug; cigarette

ends in a suitcase pouch.

The company does not rebut the fact that Mr. Cash

was in the room for only 1% days, and for only a few

hours daily then. It is not disputed that a chief pump-

man and another pumpman used the cabin before griev-

ant moved in. As in the case before Arbitrator Parker,

other persons had full access to the room because the

door was unlocked. Grievant’s unrebutted testimony is

that because he did not want to interfere with their shore

leave, he did not ask the utility men to clean his cabin.

In sum, the cabin had not been cleaned at the time of the

search, had been used by a number of persons in previous

days, and was open to others.

Except for what was found in the suitcase, it is not

reasonable to attribute, by clear and convincing evidence,

ownership of the drug materials in the cabin to Mr. Cash.

As noted above, the materials were found at scattered

points in the room. The 6 marijuana seeds were, accord-

ing to the contemporaneous record, under the rug. But

even if only some of them were there, it is hard to see

how grievant could have gotten any under the rug. He

was only in the room a short time.

It is instructive to compare the searched cabin’s con-

dition in which widely scattered material was found to

the condition of the former cabin where no material was

found at all.

60a

The circumstantial evidence certainly does not point to

only the one logical conclusion that the material belonged

to grievant. The ash could have been left by others, but

it is not easy to see how Mr. Cash could have avoided

stepping on it if it was there all along. Still, the evidence

is no stronger that he deposited the ash than that it was

there and he missed it. The chairman concludes that in

the absence of any drugs in grievant’s previous room, the

probabilities are greater that Mr. Cash did not introduce

the marijuana into his cabin prior to the search of May

17, 1989 than that he did.

If there was no reasonable cause to conclude that griev-

ant brought the drug into the cabin—and the above

analysis finds that there was not—then the Coast Guard

regulations would not call for a drug test, and no viola-

tion of the regulations could be said to exist. The ques-

tion of whether there was cause under the company

policy will be considered below.

The matter of the suitcase is the weakest point of Mr.

Cash’s defense against the charge that he violated com-

pany policy by introducing marijuana into his cabin.

(Even in light of this, the higher Coast Guard standard

of “reasonable cause” could not be met because of a)

previous occupancy of the room, b) lack of drugs in

gtievant’s previous room, and c) the other considerations

discussed above. The lower company standard conceiv-

ably might have been met by the suitcase materials. )

Mr. Cash was either incorrect when he told the PRC

that his wife purchased the suitcase for him or when he

testified at the arbitration that he acquired the suitcase

on the Exxon Benicia. Since no doubt has been cast on

his assertion that when he got the piece it was used, that

weakness of testimony may make no difference. The un-

discovered cigarette ends could have been in the pouch

no matter how the bag was obtained. Nevertheless, the

lack of candor and/or of accuracy was not supportive

of grievant. Nor was his frequent inability to recall or

to answer questions directly.

6la

Still, there is doubt how the “roaches” got in the bag.

No inference can be drawn from the presence of the other

marijuana in the searched room that grievant put the

“roaches” in the bag. The chairman has found that there

is considerable doubt Mr. Cash brought the other drug

traces into the cabin. The most that can be said about

the butts in the bag is that they would be strongly sus-

picious in the absence of the contrary circumstantial evi-

dence about the other materials found.

As many arbitrators have ruled, including Dr. Parker

in Pollard and Olsen, circumstantial evidence must lead

to one and only one logical conclusion. That cannot be

said here. Mr. Cash could not be discharged for posses-

sion of marijuana after this evidence is viewed under a

just cause standard.

We must come to an ex post conclusion about whether

there was cause to order a drug test. On May 17, 1989,

in light of what Mr. Newman and his cohorts found,

“cause” did exist. (That will create problems about griev-

ant’s refusal to take the test even if the above discussion

raises questions concerning the basis for the test order. )

The instant review of the findings concludes, however,

that even though drug material was discovered in griev-

ant’s cabin, sufficient question was raised about owner-

ship of the drugs so that “cause” “reasonable cause”,

“probable cause” or “just cause” did not exist to order

a test. And Mr. Shearer’s testimony established that Mr.

Cash’s appearance and actions provided no basis for or-

dering a test.

The chairman concludes that if Mr. Cash had taken the

demanded drug test and then had grieved, a later arbitra-

tion would have found that lack of “cause” “reasonable

cause” “probable cause” or “just cause” to have ordered

a test on the basis of what was found in the cabin would

have led to reversal of any discipline based on test results.

This analysis of the findings of the search shows that a

62a

test could not have been ordered on the basis of what

was discovered in the cabin.

Having said this, the chairman must rule that in refus-

ing the drug test, grievant violated the fundamental rule

that except when an order imperils health or safety, em-

ployees must first obey an order and then grieve. It is

of no import that the union challenged the company’s

right to test and that Mr. Cash knew it. If the union

was right, an arbitrator would have invalidated the test

on the basis that the company could not impose it uni-

laterally. But until an arbitrator issued such a ruling,

the company, and not the union, had the power to decide

what would be done.

While the company, if it chose, could decide that a

later offer to take a test would wipe out, or at least miti-

gate, the original refusal, an arbitrator has no power to

substitute his judgment for this reason. Discharge was

possible under the rules. As Arbitrator Marx stated, an

arbitrator cannot alter the rules.

Mr. Cash’s alleged later drug testing cannot be con-

sidered by the chairman to be mitigating. There is no

documentary proof that a test was taken and no docu-

mentary proof of the results, even if the results might,

arguendo, excuse Mr. Cash’s original refusal.

The chairman faces a dilemma. To sustain the dis-

charge of Mr. Cash for refusal to take a test which might

not have helped him even if the results were negative and

for which no element of cause ex post was found to exist,

appears to be at variance with a just cause standard—or

any other standard of cause. Unlike cases submitted by

the parties, Mr. Cash was not found to be under the in-

fluence of alcohol or drugs, nor is that charged against

him.

On the other hand, grievant was insubordinate. Any

positive remedy might be considered a victory or reward

for improper behavior.

Biante ign

|

63a

The chairman has concluded that since the order to

take the drug test arose out of an incorrect evaluation of

the meaning of the marijuana found in Mr. Cash’s cabin,

discharge for failure to accept the test is not possible.

However, though the penalty may be considered harsh,

reinstatement must be without back pay but with full

seniority.

AWARD

In light of the foregoing discussion, I, the undersigned

neutral chairman, being duly sworn and those members

of the panel of arbitrators who sign as concurring, having

received the testimony, evidence and argument of the

parties in a preceeding at which both were represented

ably by counsel, issue the following

AWARD

The discharge of Alan B. Cash was not for just

cause. Mr. Cash shall forthwith be reinstated with

full seniority but without back pay.

/s/ Maurice C. Benewitz

MAURICE C. BENEWITZ

Neutral Chairman

Dated: November 27, 1992

[Notary Omitted in Printing]

I (concur with) the above award

/s' Howard A. Goldberger

HOWARD A. GOLDBERGER, Esa.

Union Appointed Arbitrator

Dated: November 30, 1992

[Notary Omitted in Printing]

64a

I (dissent from) the above award

s/ William P. Hoeler

WILLIAM P. HOELER

Company Appointed Arbitrator

Dated: 12/9/92

[Notary Omitted in Printing]

65a

APPENDIX D

EXXON SHIPPING COMPANY

Policy Statement on Employee Alcohol and Drug Use

Exxon Shipping Company is committed to a safe, healthy,

and productive work place for all employees. The Com-

pany recognizes that alcohol, drug, or other substance

abuse by a few employees will impair their ability to per-

form properly and can have serious adverse effects on

the safety, efficiency, and productivity of other employees

and the Company as a whole. The misuse of legitimate

drugs or the use, possession, distribution, or sale of illicit

or unprescribed controlled drugs on Company business

or premises is strictly prohibited and is grounds for termi-

nation. Possession, use, distribution, or sale of alcoholic

beverages on Company premises is not allowed without

prior approval of appropriate senior management. Being

unfit for work because of use of drugs, or alcohol is

strictly prohibited and is grounds for termination of em-

ployment. While this policy refers specifically to alcohol

and drugs, it is intended to apply to all forms of substance

abuse.

The Company recognizes alcohol or drug dependency

as a treatable condition. Employees who suspect they

have an alcohol or drug dependency are encouraged to

seek advice and to follow appropriate treatment before it

results in job performance problems. Employee Health

Advisory Program or medical professional staff will ad-

vise and assist in securing treatment. Those employees

who follow approved treatment will receive disability

benefits in accordance with the provisions of established

benefit plans and medical insurance coverage consistent

with existing plans.

No employee with alcohol or drug dependency will be ter-

minated or otherwise disciplined solely due to a request

for help in overcoming that dependency or because of in-

66a

volvement in a rehabilitation effort. If, however, an em-

ployee violates provisions of the Employee Alcohol and

Drug Use Policy, appropriate disciplinary action will be

taken. Such action cannot be avoided by a request at that

time for treatment or rehabilitation. If an employee suf-

fering from alcohol or drug dependency refuses rehabili-

tation or fails to respond to treatment or fails to meet

satisfactory standards of effective work performance, ap-

propriate disciplinary action, up to and including termina-

tion, will be taken. This policy does not require and

should not result in any special regulations, privileges, or

exemptions from normal job performance requirements.

Exon Shipping Company may from time to time conduct

unannounced searches for drugs and alcohol on owned or

controlled property. The Company also has the right

to require employees to submit to medical evaluation or

alcohol and drug testing where cause exists to suspect

alcohol or drug misuse. A positive test result or refusal

to submit to a drug test is grounds for disciplinary action,

including dismissal.

Contractor, common carrier, and vendor personnel are

also covered by paragraph one and the search provisions

of paragraph four of this policy. Those who violate the

policy will be removed from Company premises and may

be denied future entry.

April 1, 1988 Implemented for Unlicensed Oceangoing

Employees.

67a

APPENDIX E

EXXON SHIPPING COMPANY

Post Office Box 1512

Houston, Texas 77251-1512

“EXXSHIP HOUSTON”

D. J. Paul

Human Resources Manager

September 27, 1988

TO ALL OCEANGOING EMPLOYEES OF

EXXON SHIPPING COMPANY

Recent developments by Exxon Shipping Company, the

United States Coast Guard, the United States Customs

Service, and Labor Arbitrators have focused a renewed

emphasis on our commitment to providing a safe, healthy

and productive work place by ensuring that drug, alcohol

or other substance abuse is eliminated. The purpose of

this communication is to ensure that all employees are

aware of the various rules, regulations and company pol-

icies regarding substance abuse in the work place and to

give notice that enforcement will be more stringent in the

future.

Exxon Shipping Company Employee Alcohol and Drug

Use Policy

On March 11, 1987, the Exxon Shipping Company Policy

on Alcohol and Drug use became effective for all non-

represented employees and was mailed to all employees.

The Exxon Radio Officers Association accepted the policy

during our 1987 contract negotiations. On April 1, 1988,

we implemented the Alcohol and Drug Use Policy for all

unlicensed Oceangoing employees. A copy of this policy

was again mailed to all. unlicensed employees as a part of

the total implementation package at the conclusion of

bargaining with the Exxon Seamen's Union.

The Company Policy specifically prohibits the misuse of

legitimate drugs or the use, possession, distribution, or sale

68a

of illicit or unprescribed controlled drugs on Company

business or premises. Possession, use, distribution, or sale

of alcoholic beverages on Company premises is prohibited.

Being unfit for work because of use of drugs, or alcohol is

strictly prohibited and is grounds for termination of em-

ployment. Exxon Shipping Company may from time-to-

time conduct unannounced searches for drugs and alcohol

on owned or controlled property. The Company also has

the right to require employees to submit to medical eval-

uation or alcohol and drug testing where cause exists to

suspect alcohol or drug misuse. A positive test result or

refusal to submit to a drug test is grounds for disciplinary

action, including dismissal. The guidelines for Super-

visors, which were bargained with the Exxon Seamen’s

Union, are essential to the administration of this policy

and should be familiar to every employee.

1. At the discretion of the President or Fleet Man-

ager, the Company may conduct unannounced

alcohol and drug searches on owned or controlled

property where there is reasonable cause to sus-

pect that these substances may be present. Rea-

sonable cause may include searches in operations

where use of these substances could create an un-

safe situation.

2. The decision to require an employee to submit

to testing for drugs and alcohol requires the ad-

vance endorsement of the Human Resources

Manager. Prior to any testing, the employee must

sign an Informed Consent form. In cases where

a medical evaluation is deemed appropriate, med-

ical personnel should be asked to collect a urine

and/or blood sample for testing to determine the

presence of alcohol and/or drugs. Blood tests

will not be taken on board ship by vessel per-

sonnel. If circumstances prevent medical evalu-

ation from being conducted soon after the “for

cause” incident, Management may collect and

properly process the urine sample.

69a

3. Employees who acknowledge they have either an

alcohol or drug dependency and who desire re-

habilitation and are willing to cooperate by par-

ticipating in a treatment program are encour-

aged to seek assistance through the Employee

Health Advisory Program (EHAP) or the Medi-

cal Department.

No employee with an alcohol or drug dependency

will be terminated or; otherwise, disciplined due

solely to a request for help in overcoming that

dependency or involvement in a rehabilitation

effort.

However, if an employee’s request for rehabilita-

tion is made after the Company’s discovery of a

violation of the policy, the Company will take

disciplinary action which may include termina-

tion. Such disciplinary action cannot be avoided

by a request for treatment or rehabilitation at

that time.

DEPARTMENT OF TRANSPORTATION, U.S.C.G., 33

CFR Operating a Vessel While Intoxicated

Effective January 13, 1988, the U.S.C.G. Regulations

governing operation of a vessel while intoxicated became

final. These regulations are far more explicit and strin-

gent than previous rules. For commercial vessels, a blood

alcohol content (BAC) of .04% is considered intoxicated.

When an intoxicant, either alcohol or drugs, affects a

person’s manner, disposition, speech, muscular movement,

general appearance or behavior, the employee is consid-

ered intoxicated and in violation of the regulations. The

regulations also require that while on a commercial vessel,

a crew member shall not be intoxicated at any time and

shall not perform or attempt to perform any scheduled

duties within four hours of having consumed alcohol. The

penalty for being intoxicated while on board a vessel is

a fine of up to $5000, imprisonment for up to one year,

or both.

70a

Copies of these regulations are on board all vessels for

your review and information. These rules place the pri-

mary burden for detecting, reporting, and reducing the

incidence of intoxicated behavior on marine employers.

United States Customs Service “Sea Carrier Initiative

Agreement”

The United States Customs Service has recently adopted

a “zero tolerance” policy with respect to illegal drugs found

on board vessels. A vessel on which nominal amounts

of illegal drugs are found may be subject to seizure and

forfeiture, even if the drugs are in the possession of a

crew member for personal use. As a result, the manage-

ment of Exxon Shipping Company has a responsibility to

take appropriate action. Toward that end, we have en-

tered into a voluntary agreement of cooperation with the

United States Customs Service to reduce our liability in

the event illegal drugs are found on one of our vessels.

This 15 point agreement is called the “Sea Carrier Initia-

tive Agreement.” A complete copy of the Agreement has

been sent to the Master of each vessel, the elected union

Officials of all represented employees and to each shore

based manager.

Labor Arbitrators Awards

Over the last several years, licensed and unlicensed em-

ployees have been terminated for use and possession of

alcohol or drugs while on board a vessel. Several em-

ployees have been suspended for alcohol “possession

only.” Four unlicensed employees terminated for use or

possession of alcohol or illegal drugs were reinstated by

arbitrators for various reasons.

With respect to violation of the Company’s Policy on the

prohibition of use or possession of alcohol and illegal

drugs, arbitrators have been critical of management when

the discipline is inconsistent. For example, in the matter

of arbitration between the Exxon Seamen’s Union and

Tila

Exxon Shipping Company, case no. 18 30 0062 85N,

Arbirator, Daniel F. Brent, stated in part:

“. . . It must be emphasized that the Company is

entitled to prohibit alcohol and drugs and to police

its work force in order that it may insure the safety

of its workers and protect the general public from

harm by the Company’s vessels or product. To this

end, the Company may promulgate rules reasonably

designed to insure that no alcohol or habit forming

drugs enter its premises. If in the past the Company

has permitted a variety of penalties to be imposed

for similar infractions, the Company is entitied to

give notice to the bargaining unit and to the As-

sociation that it will impose stronger penalties in the

future (emphasis added) than it has in the past in

order to guarantee that its prohibition against al-

cohol and habit forming drugs is universally ob-

served. . .”

This letter will serve as the notice stated in the arbitra-

tor’s award.

Conclusion

In view of Management’s responsibility to enforce the

Company Policy, the USCG regulations on “Operating a

Vessel While Intoxicated,” our liability under the “zero

tolerance” policy of the U.S. Customs and the USCG as

well as clear direction from Labor Arbitrators, we must

aggressively ensure that our employees are not using or

in possession of alcohol or illegal drugs while on board

a vessel. This document serves as another official notice

that violation of the Company Alcchol and Drug Use

Policy, or regulations governing alcohol or drug use in the

work place will result in immediate termination from the

vessel. While we must continue to thoroughly investigate

the facts of each individual case and make a final de-

terminaticn on a case-by-case basis, termination of em-

ployment is the penalty for violation of these standards.

72a

We will continue unannounced alcohol and drug searches

on owned or controlled property where there is reason-

able cause to suspect that these substances may be present

or in operations where use of the substances could create

an unsafe situation. The tradition of providing wine at

holiday meals will reluctantly be discontinued hereafter

in order to ensure compliance with the new USCG reg-

ulations.

These actions will assist in providing a safe work environ-

ment free of alcohol and drug use and help assure uni-

form Company actions. If you have any questions or con-

cerns regarding Management’s position on alcohol or drug

use while on Company property, please consult with the

Master. You are urged to become familiar with all pro-

visions to avoid placing your job in jeopardy.

/s/ Dan Paul

DJP:mdg

Pee ee ee ee st,

ane

73a

APPENDIX F |

REPORT OF DISCHARGE

From: Head of (Department) Date May 17, 1989

To: Master

Arthur F. Tuttle At San Francisco

Subject: Discharge of (Name)

Alan B. Cash Rating Pumpman

I recommend that the above named seaman be discharged

from the service of this vessel for violation of posted rule

no. 9

The circumstances were as follows:

Violation of company’s drug and alcohol policy

Was a Warning Issued to the Seaman?

Yes

CJ No

Signed /s/ [Illegible]}

(Department Head)

NOTE TO MASTER:

The seaman will be placed on undetermined status without

pay pending review of the case by the Personnel Relations

Committee. The seaman has a right to receive an advance

against earnings by notifying you or Fleet Manning.

From: Captain Arthur F. Tuttle. Date May 17, 1989

TO: EXXON SHIPPING COMPANY

I have investigated the circumstances in this case and ap-

prove the discharge of the above named seaman.

74a

Signed /s/ [Illegible]

(Master )

Was a copy of this report given to Seaman?

Yes

(] No

ak alia ang ate a a oe

75a

APPENDIX G

EXXON SHIPPING COMPANY

Post Office Box 1512

Houston, Texas 77251-1512

“EXXSHIP HOUSTON”

D.J. Paul

Human Resources Manager

June 6, 1989

Mr. Alan Cash

3022 Templewood Drive

Atlanta, GA 30319

Dear Mr. Cash:

On June 5 and again on June 6, 1989, the Personnel

Relations Committee met to consider the facts surrounding

your discharge from the EXXON WASHINGTON in San

Francisco, California on May 17, 1989.

Mr. Cash, on May 17, 1989 a contraband search of the

EXXON WASHINGTON was conducted at anchor in San

Francisco Bay. During the search, substances testing

positive for marijuana were found in your quarters and

personal belongings. Reasonable cause having been de-

termined, you were required to submit to testing for drugs

which you refused.

As a result of both of these incidents, you were found to

be in violation of the Company’s Drug and Alcohol Policy.

Therefore, we have terminated your employment from

Exxon Shipping Company on May 17, 1989 at close of

business.

Shortly you will be receiving a packet from Exxon’s Cen-

tral Administration group with forms for you to sign. If

you do not receive this packet within a few weeks, please

contact them at 1-800-262-2363.

JFM:dd

c: Payroll Dept.

Central Admin.

D. J. Paul

D. K. Walker

G. T. Shearer

ESU Offices

76a

Sincerely,

/s/ J. F. McDermott

J. F. MCDERMOTT

Fleet Manning Coordinator

PhP eM De

Sie Had emits Be MOBI SE > Sa Ma

77a

APPENDIX H

Portions of Coast Guard and Department of Transportation

Regulations concerning Reasonable cause testing require-

ments, 46 C.F.R. § 16.250(a)-(d) (1989)

$ 16.250 Reasonable cause testing requirements

(a) The marine employer shall require any crewmem-

ber engaged or employed on board a vessel owned in the

United States that is required by law or regulation to

engage, employ or be operated by an individual holding

a license, certificate of registry, or merchant mariner’s

document issued under this subchapter, who is reasonably

suspected of using a dangerous drug to be chemically

tested for dangerous drugs.

(b) The marine employer’s decision to test must be

based on a reasonable and articulable belief that the indi-

vidual has used a dangerous drug based on direct obser-

vation of specific, contemporaneous physical, behavioral,

or performance indicators of probable use. Where prac-

ticable, this belief should be based on the observation

of the individual by two persons in supervisory positions.

(c) When the marine employer re.uires testing of an

individual under the provisions of this section, the indi-

vidual must be informed of that fact and directed to pro-

vide a urine specimen as soon as practicable. This fact

shall be entered in the vessel’s official log book, if one

is required.

(d) If an individual refuses to provide a urine speci-

men when directed to do so by the employer under the

provisions of this section, this fact shall be entered in the

vessel’s official log book, if one is required.

79a

APPENDIX I

Portions of United States Coast Guard Random, Pre-

Employment and Reasonable Cause Drug Testing Rules

Facts and Information prepared by Investigations Depart-

ment, U.S. Coast Guard Marine Safety Office, 1440 Canal

Street, New Orleans, LA 70112-2711 (April 28, 1989)

What is testing for “reasonable cause’?

Reasonable cause means a probability exists, based on

some evidence, that a crewmember is intoxicated by or

has used drugs, or is intoxicated by alcohol. Alcohol in-

toxication on a commercial vessel is any BAC of .04%

or greater. Note that in the case of drugs there need not

be evidence of intoxication per se; evidence of use is

sufficient to require testing.

Generally the following elements must be present to have

“reasonable cause” to require drug and/or alcohol testing.

1. Direct observation of the suspected crewmember and/

or any physical evidence by two persons in supervisory

positions. This means the supervisors must personally

see the evidence for themselves.

2. There must be some physical, behavorial, or perform-

ance indication of use or intoxication. Indicators in-

clude but are not limited to an individual’s person.

Drugs and drug paraphernalia as well as alcoholic

beverage containers in clothing and personal property,

or concealed in staterooms or elsewhere may also pro-

vide reasonable cause since these too are physical indi-

cators. Smoke, breath and body odors may provide

evidence. Slurred and incoherent speech, lack of co-

ordination and balance, nodding and dozing off on

watch, inability to report for duty, frequent or ex-

tended unexplained absences from assigned duties,

sudden and wide changes of mood or attitude and

many other observable variables are examples of some

conditions which could constitute reasonable cause.

80a

Since these circumstances and conditions could be

caused by illness, injury or other factors, as well as

drugs and alcohol, the decision to test for reason-

able cause must be made with prudence and common

sense.

3. When the marine employer determines that reasonable

cause to require a test exists, the individual must be

informed of that fact and directed to test as soon as

practicable. The marine employer must specify

whether or not urine or BAC testing or both are

being required.

4. An entry concerning the basis of reasonable cause, the

direction to test given the crewmember, and any re-

fusal or other response should be logged. This log

entry must be made whenever an official ship’s log is

required to be carried.

While there must be some observable evidence that a

crewmember is intoxicated to have reasonable cause for

alcohol testing, it is worth noting that a BAC of .04% or

greater could be reached by consumption of less than

three drinks in an hour. Observed odor of alcohol on a

person’s body or breath is reasonable cause to test.

A law enforcement officer may also order testing for rea-

sonable cause. This means Coast Guard and other fed-

eral law enforcement officers, state police, harbor police,

wildlife and fisheries officers, sheriff's deputies and muni-

cipal police officers: Anyone who has police jurisdiction

where a vessel is found.

Oh, Pim iate cath a ee ae FT? a

8la

APPENDIX J

165550 Canada Limited

172965 Canada Limited

2849518 Canada Limited

571270 Alberta Limited

590320 Alberta Ltd.

AGA Progas a.s

Abu Dhabi Petroleum Company Limited

Ace Polymer Co., Ltd.

Acquifund Resources Limited

Aditivos Orinoco, C. A.

Adria-Wien Pipeline Gesellschaft mit beschrankter Haftung

Advanced Elastomer Systems Do Brasil Ltda.

Advanced Elastomer Systems Japan Limited

Advanced Elastomer Systems Limited

Advanced Elastomer Systems Marketing Pte. Ltd.

Advanced Elastomer Systems NV/SA

Advanced Elastomer Systems Singapore Pte. Ltd.

Advanced Elastomer Systems, Canada, Inc.

Advanced Elastomer Systems, Inc.

Advanced Elastomer Systems, L.P.

Air Tankdienst Koeln GbR

Aircraft Fuel Supply B. V.

Al-Jubail Petrochemical Company

Alberta Products Pipe Line Ltd.

Alyeska Pipeline Service Company

AquaAir Environmental, Inc.

Aramco Services Company

Asakawa Sekiyu K.K.

Awaji Gas Nenryo Kabushiki Kaisha

Azuma Sekiyu K.K.

B.W.O.C., Inc.

BEB Erdgas und Erdoel GmbH, Hannover

BRIGITTA Erdgas und Erdoel GmbH, Hannover

Bangkok Aviation Fuel Services Limited

Banshu Ekika Gas K.K.

Bayerische Erdoelleitung G.m.b.H.

82a

Beaverhill Resources Limited

Brickwood Holdings Pty. Ltd.

Bryan Austin Chalk Operating Committee, Inc.

Bryan Woodbine Gathering, Inc.

Canadian Reserve Oil & Gas Ltd.

Cascade Fertilizers (1990) Limited

Castle Peak Power Company Limited

CeraMem Separations, Inc.

Changi Airport Fuel Hydrant Installation Pte. Ltd.

Changi Into-Plane Services (Pte) Ltd.

Chuo Sekiyu Hanbai K.K.

Comcor Chemicals Limited

Compagnie Industrielle des Polyethylenes de Normandie,

GIE

Compania Minera Disputada de Las Condes S.A.

Comptoir Auxiliaire du Petrole

Comptoir Oyonnaxien des Combustibles (C.O.C.)

Computer Centrum Groningen B.V.

Copim St. Lawrence Ltd.

Cynthia Gas Gathering Company Limited

DFTG Deutsche Fluessigerdgas Terminal GmbH

Daihatsu Sekiyu K.K.

Daito Gas K.K.

Depot Petrolier du Gresivaudan

Depots Petroliers de la Corse

Depots de Petrole Cotiers

Deudan-Holding GmbH

Deutsche Advanced Elastomer Systems GmbH

Deutsche Erdgas Transport G.m.b.H.

Deutsche Transalpine Oelleitung G.m.b.H.

Devons Estates Limited

Disma S.r.1.

Dixie Pipeline Company

Dunbar Oil Ltd.

E S F Limited

ETD Tankdienst Gesellschaft Duesseldorf GbR

Eagle Kenso K.K.

83a

Eagle Reinsurance Co. Ltd.

East Texas Salt Water Disposal Company

Eiko Sekiyu K.K.

Elwerath Erdgas und Erdoel GmbH, Hannover

Elwerath Erdoel und Erdgas AG

Emirates National Chemicals Company L td.

: Emori Sekiyu K.K.

; Emsland-Erdoelleitung G.m.b.H.

| Emulsions de Feyzin

Emulsions du Dauphine

Energie Marketing Service GmbH

Enterprise Housing Partners 1992 Limited Partnership

Entrepot Petrolier de Mulhouse (E.P.M.)

Entrepot Petrolier de Aveyron (E.P.A.)

Erdgas-Verkaufs-Gesellschaft m.b.H.

Erdoel-Raffinerie Deurag-Nerag GmbH

Esso (Overseas) Pension Trust Limited

Esso Energie G.I.E.

Esso Exploration and Production Angola Inc.

Esso Exploration and Production Ireland Limited

Esso Lub’Services

Esso Malaysia Berhad

Esso Raffinage S.A.F.

‘ Esso Societe Anonyme Francaise

Esso Standard Thailand Ltd.

Esso Standard Tunisie S. A.

f Esso Technologies et Services (E.T.S.)

% Esso Yukong Specialties Ltd.

‘ Etablissements Cloarec

A Exxon Asset Funding Company

. Exxon Asc*t Management Company

Exxon Chemucal Asset Management Partnership

Exxon Chemical France

Exxon Chemical Paraffins Limited

F Exxon Chemical Polymeres SNC

Exxon Mobile Bay Partnership

t Exxon de Colombia S.A.

F.T. Giken Kabushiki Kaisha

84a

Federated Pipe Lines Ltd.

Ferngas Nordbayern G.m.b.H.

Ferngas Salzgitter GmbH

Fernkaelte Geschaeftsstadt Nord G.b.R.

Flughafen Schwechat Hydranten-Gesellschaft

Fuji Kogyo K.K.

Full Cycle Plastics Pty. Ltd.

Gl6a (Groep) B.V.

Gasunie Engineering B.V.

Gasunie Warmte/Kracht Emmen B.V.

General Bussan K.K.

General Highway K.K.

General Petrochemical Industries Limited

General Sekiyu K.K.

General Sekiyu Okinawa Hanbai K.K.

General Sekiyu Overseas, Ltd.

General Shipping Co. Ltd.

General Unyu Kabushiki Kaisha

Geobutane—Lavera

Ges. fur Mineraloelveredlung und Distribution Rhaesa

mbH

Gewerkschaft Brassert Erdoel und Erdgas GmbH

Gewerkschaft Gute Hoffnung Erdgas und Erdoel GmbH

Gewerkschaft Kuechenberg Erdgas und Erdoel GmbH

Glen Park Gas Pipe Line Company Limited

Grande Ecaille Land Company, Inc.

Groupement Immobilier Petrolier

Groupement Petrolier Aviation

Groupement Petrolier de Nantes (G.P.N.)

Groupement Petrolier de Saint-Pierre des Corps

(G.P.S.P.C.)

Groupement Petrolier de la Cote d’Azur

Groupement Petrolier du Finistere G.I.E.

Groupement Petrolier du Val-de-Marne (G.P.V.M.)

Groupement d’Exploitation du Depot de Reception de

Chennevie

Hambrecht & Quist Environmental Technology

Hamburger Gaswerke GmbH

ee

ve oe ww ele ae . as

85a

Hannoversche Erdoelleitungs-G.m.b.H.

Hanshin Kyowa Sekiyu K.K.

Heinrich Schneider Spedition GmbH

Hiroshima General Gas Juten Kabushiki Kaisha

Hoei Sekiyu K.K.

Hokkai Sanshi Co., Ltd. (Chemical)

Hokushin Bussan K.K.

Hokuyu Sekiyu K.K.

Hong Kong Pumped Storage Development Company,

Limited

Houston Regional Monitoring Corporation

Hydrant Refuelling System, S.A.

Hydranten-Betriebs-Gesellschaft, G.b.R.

Hydrierwerke Poelitz Aktiengesellschaft

Imperial Oil (an Ontario General Partnership)

Imperial Oil Limited

Imperial Oil Resources Limited

Imperial Oil Resources N.W.T. Limited

Imperial Oil Resources Ventures Limited

Imperial Oil Resources an Alberta limited partnership

Industria Acqua Siracusana S.p.A.

Industry Promotion Enterprises Limited

Iranian Oil Participants Limited (Iranian Consortium )

Iranian Oil Services (Holdings) Limited

Iranian Oil Services Limited

Iraq Petroleum Company, Limited

Iraq Petroleum Pensions, Limited

Japan Butyl Company Limited

Jaymo SNC

Jersey Nuclear-Avco Isotopes, Inc.

K. K. Momose Shiojiri Stand

K. K. Toresen

K.K. Aizu General

K.K. Auto

K.K. Daimaru

K.K. Eastern Gas Terminal

K.K.General Sekiyu Hanbaisho

K.K. Genet

K.K. Genetech

86a

K.K. Genex

K.K. Heian Sekiyu

K.K. Kyoei Shosha

K.K. Marugo Izumasa Shoten

K.K. Marutaka Sekiyu

K.K. Momose Sekiyu

K.K. Standard Sekiyu Osaka Hatsubaisho

K.K. Toko

K.K. Uwano Sekiyu Shokai

K/S Statfjord Transport A/S & Co.

KX Industries, L.P.

Kabushiki Kaisha Sankyo Plastics

Kabushiki Kaisha Serubisu

Kai Tak Refuellers Company Limited

Kansai Chuo Sekiyu K.K.

Kanto Kygnus K.K.

Karlsruhe-Stuttgart Rohrleitung Gesellschaft mbH

Kawasaki Kygnus Sekiyu Hambai Kabushiki Kaisha

Keiyo Sekiyu Hanbai K.K.

Kemcor Australia Pty. Ltd.

Kemcor Elastomers Ltd.

Kemcor Olefins Ltd.

Kemcor Plastics Pty. Ltd.

Kenya Petroleum Refineries Limited

Kibo Sekiyu Hanbai K.K.

Kimura Sekiyu Kabushiki Kaisha

Kinwa Sekiyu K.K.

Kobe Standard Sekiyu K. K.

Korea Perchem Company Limited

Kosxon Chemical Company Limited

Kowa Sekiyu K.K.

Kowloon Electricity Supply Company Limited

Kumho E.P. Rubber Co., Ltd.

Kygnus Ekika Gas Kabushiki Kaisha

Kygnus Kosan Kabushiki Kaisha

Kygnus Sekiyu K. K.

Kygnus Sekiyu Seisei Kabushiki Kaisha

Kygnus Trading Kabushiki Kaisha

Ee I OTE tT

Kyushu Eagle K.K.

L-Net East K.K.

L-Net West K.K.

L12A (Groep) B.V.

L12B/L15B (Groep) B.V.

L14 (Groep) B.V.

LI5A (Groep) B.V. |

L2 (Groep) B.V.

L5a (Groep) B.V.

LEAG Aktiengesellschaft fuer luzernisches Erdoel

Les Docks des Petroles d’Ambes

Liants Routiers de la Vallee de la Loire (LRVL)

Liants Routiers du Gard (L.R.G.)

Lilac Sekiyu Kabushiki Kaisha

Lily Sekiyu K.K.

Lithcon Petroleum International (Bahamas) Inc.

Lithcon Petroleum Taiwan Inc.

Long Beach Oil Development Company

MEGAL FINCO

MEGAL GmbH

Maasvlakte Olie Terminal C.V.

Maasvlakte Olie Terminal N.V.

Magota Sekiyu K.K.

Mainline Pipelines Limited

Malaysian Energy Chemical & Services Sdn Bhd

Manchester Airport Storage and Hydrant Company

Limited

McCann Plastics Inc. (Chemical )

McColl-Frontenac Inc.

McColl-Frontenac Petroleum Inc./Petroliere McColl-

Frontenac

Meiji Sekiyu K.K.

Mikawa Bussan K.K.

Mitake Unso K.K.

Mittelrheinische Erdgas Transport Gesellschaft mit

beschrank

Mode Wheel Property Limited

88a

Montreal Pipe Line Limited/Les Pipe-Lines Montreal

Limitee

Mount Thorley Coal Loading Limited

Multi Tank Card B.V.

Mytex Polymers (General Partnership)

N. V. Nederlandse Gasunie

NAM - K 14 B.V.

NAM - K 15 B.V.

NAM -K7B.V.

NAM-K17 B.V.

NAM/CLOMS - K 8/K 11 B.V.

NAM/CLOMS - L 13 B.V.

NAM/MOBIL M9a B.V.

NPC Services, Inc.

Nakabayashi Sekiyu K.K.

Nansei Oil Terminal K.K.

Nansei Sekiyu Kabushiki Kaisha

Nanseki Kaihatsu K.K.

Native Venture Capital Co. Ltd.

Near East Development Corporation

Nederlandse Aardolie Maatschappij B. V.

Neptune Bulk Terminals (Canada) Ltd.

New Cure, Inc.

Newcastle Coal Shippers Pty. Limited

Nichiei Kogyo Kabushiki Kaisha

Nichimo Oil (Bermuda) Co., Ltd.

Nikko Sangyo K.K.

Nippon Unicar K.K.

Nissei Sekiyu Kabushiki Kaisha

Nogat B.V.

Norddeutsche Erdgas-Aufbereitungs G.m.b.H.

Norddeutsche Mineraloelwerke Stettin G.m.b.H.

Nordrheinische Erdgas Transport Gesellschift mit

beschrankte

Noroxo

Northward Developments Ltd.

OSLO Alberta Limited

Office Prive d’Assurances et de Courtages

ae Spe By Basi

89a

Oil Field Chemicals Company (Saudi Arabia) Ltd.

Oil Service Company of Iran (Private Company)

Oil Spill Response Limited

Oldenburgische Erdoel Gesellschaft m.b.H.

Oleoducto de Colombia S.A.

Oleoductos Canarios, S.A.

Osaka General Gas K.K.

Osaka Kygnus K.K.

P. T. Stanvac Indonesia

P.A.C. S.A.R.L. (Pinson-Allegret-Causse )

PIMEC Inc.

Pacesetter Enterprises Limited

Pars Investment Corporation

Peninsula Electric Power Company Limited

Petroleum Services (Middle East) Limited

Petrosvibri S.A.

Pier Atlantic Limited

Pipe Line Services, Inc.

Plantation Pipe Line Company

Port-Jerome Gaz (P.J. Gaz)

Portland Pipe Line Corporation

Primaerdoel GmbH

Prince William Sound Oil Spill Response Corporation

Progas Limited

Projectbureau W/K B.V.

Quadrant Gas Limited

Raffinerie du Midi S.A.R.L.

Rainbow Pipe Line Company, Ltd.

Redwater Water Disposal Company Limited

Refineria Petrolera Acajutla, S. A.

Regulus Holding (Singapore) Pte. Ltd.

Rheingas Erdgasleitungs-Gesellschaft m.b.H.

Rotterdam Antwerpen Pijpleiding (Belgie) N.V.

Rotterdam Antwerpen Pijpleiding C.V.

Rotterdam-Antwerpen Pijpleiding (Nederland) N.V.

Rubiatec Sendirian Berhad

Ruhrgas Aktiengesellschaft

S.A. du Pipeline a Produits Petroliers sur Territoire

Geneve

90a

SEAG Aktiengesellschaft fuer schweizerisches Erdoel

SERAM S.p.A.

SOVEXOIL Oil Field

Saitama Sekiyu Hanbai K.K.

Sanyo Sekiyu K.K.

Saraco S., A.

Saudi Arabian Lube Additives Company Limited

Schubert KG

Senboku Oil Kikoh K.K.

Shehtah Drilling Limited

Shimoyama Sekiyu K.K.

Shin-Nihon Yukagaku Kogyo K. K.

Shinohara Oil K.K.

Smiley Gas Conservation Limited

Sociedad Nacional de Oleoductos Ltda.

Sociedad de Inversiones Limited /

Societa Italiana per l’'Oleodotto Transalpino S.p.A.

Societa per Azioni Raffineria Padana Olii Minerali-

SARPOM

Societe “Geomines-Caen”

Societe Anonyme “Produits Lubrifiants de Madagascar” -

PROLU

Societe Anonyme de Gestion de Stocks de Securite

(SAGESS)

Societe Anonyme de la Raffinerie des Antilles

Societe Anonyme des Hydrocarbures

Societe Civile de Mustapha Algerie

Societe Civile de Participation pour la Destruction des

Dech

Societe Esso de Recherches et d’Exploitation Petrolieres

Ess

Societe Francaise EXXON CHEMICAL

Societe Havraise de Manutention de Produits pernmces

Societe Malgache de Raffinage

Societe Paris-Manche

Societe Paris-Niel

Societe Reunionnaise d’Entreposage

Societe d’Etude et d’Exploitation de la Raffinerie du

Tchad

9la

Societe d’Exploitation & de Developpement d’Operations

Comme

Societe d’Exploitation des Garages Les Stations Tour

Eiffel

Societe de Manutention de Carburants Aviation

(S.M.C. A.)

Societe de Promotion et de Financement Touristique

(CARTHAGO)

Societe de la Raffiner’~ d’Alger

Societe des Pipe-Lines de Strasbourg

Societe des Transports Petroliers par Pipe Line

Societe du Caoutchouc Butyl (SOCABU)

Societe du Pipe Line de la Raffinerie de Lorraine

Societe du Pipe-Line Mediterranee-Rhone

Societe du Pipeline Sud-Europeen

Socony-Standard-Vacuum Oil Company

(Petroleum Maatschappij)

Southern Natural Gas Development Pty. Ltd.

Standard Kaihatsu K.K.

Standard Kosan Kabushiki Kaisha

Standard Service K.K.

Stansted Fuelling Company Limited

Statfjord Transport A/S

Stockage Geologique de Gaz de Lavera

Sueddeutsche Erdgas Transport Gesellschaft mit

beschrankter

Sun East (Dublin) Company, Ltd.

Superior Disk Corporation

Syncrude Canada Ltd.

Synergistics Industries (NJ) Inc.

Synergistics Industries (TX) Inc.

Synergistics Industries Limited

TAR-Tankanlage Ruemlang AG

TBN Tanklager-Betriebsgesellschaft Nuernberg mbH

TCA Plastics Inc.

TEAM Terminal B.V.

TFS Turbo Fuel Services GmbH, Hamburg

TGF Tankdienst Gesellschaft Frankfurt G.b.R.

92a

TGM Tankdienst-Gesellschaft Muenchen GbR

TIBA Speditions GmbH

TLS Tanklager Stuttgart GmbH

Taihei Bussan K.K.

Taisei Kogyo Sekiyu Hanbai K.K.

Taketsuru Yugyo K.K.

Tankanlage A. G., Mellingen

Tanklager Altischausen A. G.

Tanklager Taegerschen AG

Tanklager-Gesellschaft Tegel G.b.R.

Tanklagergeselischaft, Koeln-Bonn G.b.R.

Tecnica Quimica Petrolera, S.A. de C.V.

Terminal Petrolier de Bordeaux (T.P.B.)

Thai Aliphatics Company Limited

Thai C-Center Company Limited

Thai Petroleum Pipeline Co., Ltd.

Thyssengas G.m.b.H.

Tohpren Co., Ltd. (Chemical)

Tojo Gas K.K.

Toko Sekiyu K.K.

Tonen Chemical Nasu Co., Ltd.

Tonen Energy International Corp.

Tonen Energy and Marine (Singapore) Pte. Ltd.

Tonen Filare Co. Ltd.

Tonen Film Company Limited

Tonen Kabushiki Kaisha

Tonen Kagaku K.K.

Tonen Properties Inc.

Tonen Sogo Service Co., Ltd.

Tonen System Plaza Kabushiki Kaisha

Tonen System Service Kabushiki Kaisha

Tonen Tanker Kabushiki Kaisha

Tonex Company Limited

Towa Compounding Co., Ltd.

Towa Sekiyu K.K.

Toyoshina Film Company, Ltd.

93a

Trans-Northern Pipelines Inc.

Transalpine Oelleitung in Oecesterreich Gesellschaft m.b.H.

Transgaz Lavera

Tsurumaru Unyu K.K.

UBAG - Unterflurbetankungsanlage Flughafen Zurich

Ulan Coal Mines Limited

United Industry Development Co., Ltd.

Van Salt Water Disposal Company

Verbundnetz Gas AG

Wako Jushi Kabushiki Kaisha

Warmtepomp Nederland B.V.

Westdeutsche Erdoelleitungs-G.m.b.H.

Westgas G.m.b.H.

Woodbine Marketing Co., Inc.

Worex S.N.C.

Yashaka Sekiyu K.K.

Yellowstone Pipe Line Company

Yoshimi Gas Kabushiki Kaisha

Yuai Sekiyu K.K.

Zenon Environmental Systems Inc. (ZEST)