Transit Authority waived immunity in grievance/arbitrator dispute

Dallas Area Rapid Transit and Nancy K. Johnson v. Amalgamated Transit Union Local No. 1338, 05-14-00208-CV (Tex. App. – Dallas, November 25, 2014).

This is an interlocutory appeal from the denial of a plea to the jurisdiction in a breach of contract case which the Dallas Court of Appeals affirmed.

This is an employment suit challenging Dallas Area Rapid Transit’s (“DART”) grievance procedure. If an employee files a grievance they begin on level one and go to level three. If a request is denied on all three levels it can be referred to the neutral DART Trial Board, but the Board does not have jurisdiction over all grievances. Probationary employees have a more limited right to grievances and have no right to appeal. Union Local No. 1338 (“Union”) sued in 2000 alleging DART was denying employees the right to grievances and the parties entered into a settlement agreement. DART added into its policies that the Secretary may deny requests for an appeal to the Trial Board if the Secretary believed in good faith the Board did not have jurisdiction to hear the appeal.  In 2010 a newly hired rail operator, Katz, filed a discrimination grievance which was denied by the Secretary holding his probationary status precluded his right to appeal. Katz was later terminated. The Union became involved and the matter was submitted to an arbitrator who determined the Trial Board had jurisdiction and the appeal should have been submitted. DART filed a motion to dismiss with the Trial Board which the Board granted holding the arbitrator’s decision was not binding on the Trial Board’s determination of its own jurisdiction. The Union sued and the trial court denied DART’s plea to the jurisdiction.

The 5th Court of Appeals first analyzed the pleadings and determined the Union properly brought a breach of contract claim for violating the original settlement agreement. It disagreed with DART’s assertion that the arbitrator’s decision to submit to the Trial Board limits the Board’s decision to later determine its own jurisdiction. To hold otherwise defeats the purpose of the arbitrator provision in the settlement agreement. DART waived immunity in the 2000 lawsuit because it sought counterclaims.  It therefore cannot regain immunity in breaching the agreement on which the settlement was based.  The court then rejected DART’s assertion the Union should have sought redress through the Department of Labor under the Urban Mass Transit Act since that only applies to the establishment of, or failure to establish, specified wages, hours or conditions of work and Katz complained of discrimination. [Comment: I know a lot of arbitrators and judges who believe discrimination in the workplace does constitute a “condition of work” so that seems a little stretched to me.]  In the end, the court affirmed the denial and held DART waived its immunity.

If you would like to read this opinion click here. Panel: Justice O’Neill, Justice Lang-Miers and Justice Brown. Memorandum Opinion by Justice Lang-Miers.  The attorneys listed for the Union are Joseph H. Gillespie  and Hal K. Gillespie.  The attorney listed for DART is Higinio Gene” Gamez.