In a recent decision declining to overturn the arbitration board despite their disagreement and even "bewilderment" with the decision, the Eighth Circuit again confirms that the National Rail Adjustment Board (NRAB) has ultimate authority over disciplinary appeals from railroad employees so long as the board operates within the confines of the governing collective bargaining agreement.1 By doing so, the Court of Appeals has arguably stretched the bounds of deference for the arbitration board beyond reasonable limits.

Railroad engineer Matthew Lebsack was fired by his employer Union Pacific Railroad after an investigation for violating company rules when he intentionally defecated on a railroad car connector, left the mess for his coworkers to clean up, and told his manager he left a "present" for him.

Mr. Lebsack's union, the International Association of Sheet Metal, Air, Rail and Transportation Workers (SMART), represented him in appealing the termination. Under the Railway Labor Act (RLA), the appeal was heard by the NRAB, who ordered Lebsack reinstated due to mitigating circumstances, including a known history of psychological issues, and because the railroad had failed to conduct medical and psychological evaluations prior to discipline. Union Pacific petitioned to vacate the decision in district court. The district court, although "troubled" by the NRAB's decision, upheld it and granted summary judgment for SMART. Union Pacific appealed to the Eighth Circuit, which affirmed.

The respective operative Collective Bargaining Agreement (CBA) is key in matters governed by the RLA. Union Pacific argued that the arbitration board exceeded its jurisdiction by modifying the terms of the CBA. The governing CBA, in this case, had a system-wide discipline rule which sets forth the procedures for disciplinary actions against engineers, including notice and investigation. However, unlike the cases that Union Pacific cited in which courts did find that the arbitration board exceeded its authority, the operative CBA here did not expressly restrict the NRAB's authority to review and modify the railroad's choice of remedy.2 The Court thus found that the board's remedy "did not contradict or alter the CBA's terms."

The Court expressed their "bewilderment" at the NRAB's decision that a railroad "cannot fire someone for purposefully defecating on company property," but went on to emphasize that they could not review the merits of the case, only answer the query of whether the NRAB has even arguably applied the governing CBA and acted within the scope of its authority. The Court also expressly stated that the case imposed no future "all-encompassing duty" on railroads in similar matters.


1 Union Pac. R.R. Co. v. Int'l Ass'n of Sheet Metal, Air, Rail, & Transportation Workers, (SMART)-Transportation Div., 988 F.3d 1014, 1018 (8th Cir. 2021).

2 To contrast, the operative CBA in Northern States provided that "[i]n the matter of suspension, demotion, or discharge, if after hearing witnesses, the charges are not sustained ... the arbitration board may rule that the employee shall or shall not receive full or partial wages from the Company." Therefore, the Court held that the arbitration board could only determine an appropriate remedy if they first found that the employee was not terminated for just cause. N. States Power Co., Minnesota v. Int'l Bhd. of Elec. Workers, Loc. 160, 711 F.3d 900, 902 (8th Cir. 2013).

Originally published March 25, 2021

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