Labor & Employment Law Daily Wrap Up, LABOR—ARBITRATION—Grievance over work performed by non-unit sales executives partially sustained, (May 7, 2025)

By WK Editorial Staff

The dispute centered on whether sales executives, in addition to union-represented inside sales coordinators, could prepare non-urgent quotes.

An arbitrator sustained in part a union’s grievance contending that Hapag-Lloyd (America), Inc. violated a labor contract by allowing a non-union sales executive to prepare routine rate quotations that allegedly should have been handled exclusively by bargaining unit sales support employees. The contract explicitly reserved quotation duties—including quotes sent to the group email inbox (LBSALES)—to unit members, and the job description reinforced this work jurisdiction. The arbitrator rejected the company’s argument that such quoting was a shared practice and held that only limited exceptions, such as urgent customer requests or management-level decisions, permitted deviation. The employer conceded that the executive improperly completed quotes sent to the LBSALES box, and though the arbitrator found no systemic reassignment of work, he found that the employer breached the contract in this instance (Hapag-Lloyd (America), Inc. and International Longshore and Warehousemen’s Union, Local 63 (Cloke, Arb. Jan. 31, 2015)).

Unit work? The union filed a grievance alleging that the employer violated the labor contract by permitting a sales executive to prepare routine rate quotations that were the exclusive work of bargaining unit sales support clerks.

Past practice. The dispute centered on whether sales executives, in addition to union-represented inside sales coordinators, could prepare non-urgent quotes. The employer claimed a longstanding shared practice by which both groups created quotes, while the union maintained that only limited exceptions existed for urgent requests made directly to executives.

Evidence and prior settlement. The arbitrator reviewed contract language, bargaining history, job descriptions, and over 200 quotes generated by one sales executive between December 2013 and May 2014. The parties had previously settled an initial grievance against the same executive for preparing a quote sent to both her and the LBSALES inbox, and the employer conceded that such requests belonged to the union.

Exclusive unit work. The arbitrator determined that requests arriving in the LBSALES inbox, or directly to a coordinator, fell within the exclusive scope of bargaining unit work. By contrast, quotes initiated through executive phone calls or direct emails, especially where the customer explicitly sought assistance from an executive, could lawfully be handled by non-union staff.

Functional rule. The arbitrator also rejected the union’s proposal to limit executives to “urgent” situations, finding that term too vague and inconsistent with actual practice. Instead, the arbitrator crafted a functional rule: sales executives could prepare quotes if a customer expressly requested it, if business urgency required it, or if sales coordinators lacked the expertise or authority to resolve a customer issue.

No absolute prohibition. The arbitrator emphasized that the contract did not create an absolute prohibition on executive involvement, nor did it permit unregulated substitution of bargaining unit work. Sales executives could not redirect quote requests away from coordinators, and the number of quotes handled by any one executive should not exceed historical norms. The arbitrator recognized that collaboration between sales executives and coordinators was routine and acceptable, provided it did not shift responsibility for initial preparation away from unit staff.

Single violation, not systemic. Though the arbitrator found that the company breached the contract through the one sales executive’s overuse of quoting authority, there was insufficient evidence of a broader company policy or intent to strip work from the unit. Thus, no systemic violation was found. The arbitrator retained jurisdiction over the remedy, directing the parties to negotiate damages and reaffirm appropriate protocols going forward.

Attorneys: Stephen L. Berry for Hapag-Lloyd (America), Inc. Ralph M. Phillips for International Longshore and Warehousemen’s Union, Local 63.

Companies: Hapag-Lloyd (America), Inc.; International Longshore and Warehousemen’s Union, Local 63

Cases: Labor Arbitration UnionsMembers ContractClaims