Rehearing and Rehearing En Banc Denied April 22, 1991.
ESCHBACH, Senior Circuit Judge.
This appeal concerns when laid off employees of Torrington Company ("Torrington" or "Company") receive seniority credit for the period of their layoff under their collective bargaining agreement ("CBA"). Jurisdiction is based upon statutory interpleader (28 U.S.C. § 1335), Section 301 of the Labor Management Relations Act ("LMRA") (29 U.S.C. § 185), and Section 502 of the Employee Retirement Income Security Act ("ERISA") (29 U.S.C. § 1132). The Appellants are a class of fifty-one employees (the "Class") who are a part of a larger group that had been laid off prior to a plant closing. If the Class members earned seniority day-by-day during their layoff, each of them had sufficient seniority to be entitled to plant closure benefits. None of the Class members had enough seniority to receive these benefits, however, if they were entitled to seniority for the period of their layoff only when (and if) recalled to work. The Appellees include Torrington and the members of the Board of Administration ("Board") that denied plant closure benefits to the Class. The District Court granted summary judgment for the Appellees, concluding that the Class members are not entitled to plant closure benefits. We reverse and remand for further proceedings because we conclude the Class members' seniority as defined in the CBA includes the time spent on their final layoff.
In 1966, Torrington entered into a CBA with the International Union of the United Automobile, Aero-Space, and Agricultural Implement Workers of America ("UAW") and its Local Union Number 590 in South Bend, Indiana ("Local"). The Local had been concerned about the impact of a possible plant closure upon the most senior Torrington employees. And so, the 1966 CBA required Torrington to establish a Supplemental Unemployment Benefit Fund ("Fund") that would pay benefits to eligible employees in the event Torrington would close or relocate its South Bend plant.
In 1981, Torrington, the UAW and the Local entered into the CBA now at issue. The 1981 CBA specifies that an employee "must have at least ten (10) years of continuous Company service" to be eligible for plant closing benefits from the Fund. Article XV, Section 2. All parties agree that "continuous Company service" means "seniority" as defined in the 1981 CBA. As required by the CBA, Torrington, the UAW and the Local together approved a written plan for the administration of the Fund, as amended May 1, 1981 ("Fund document" or "Plan document"). Because the Fund is maintained by Torrington for the purpose of providing unemployment benefits to the employees, it is an "employee welfare benefit fund" and thus subject to ERISA. See 29 U.S.C. §§ 1002-1003.
The Fund document contains eligibility language identical to that of the 1981 CBA. The Fund document also establishes procedures for applying for benefits. An employee must first file an application with the Company. If the application is denied, the employee may then appeal to the Board. The Board's decision is final and binding upon all parties. Although the Board is forbidden to waive, alter, or qualify the eligibility requirements, the Board does possess the authority to make necessary
On October 13, 1983, Torrington announced it was closing its South Bend plant and relocating outside Indiana. The Board then announced that to be eligible for plant closing benefits, an employee must have been actively working at Torrington on the date of the plant closure announcement. The Board abandoned that position during the litigation before the District Court,
Standard of Review
This Court reviews the District Court's grant of summary judgment de novo. See, e.g., La Preferida, Inc. v. Cerveceria Modelo, S.A., 914 F.2d 900, 905 (7th Cir.1990). A further question is the degree of deference, if any, we owe to the Board's interpretation of when laid off employees receive seniority under the Plan. The Supreme Court has held "that a denial of [ERISA] benefits ... is to be reviewed under a de novo standard unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan." Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 956, 103 L.Ed.2d 80 (1989).
This conclusion requires de novo review of the Board's decision because no plan can provide discretion to deny benefits for reasons identified only years after the fact.
Determination of Seniority Under the CBA
The question we must answer is when does an employee who has been laid off receive seniority for the time of the layoff.
The place to begin is the CBA. Article VI of the CBA provides:
We believe the language of the CBA unambiguously rejects the position advocated by the prevailing parties below. Seniority accrues "from the original date of hire." Seniority is lost because of a layoff only if the layoff lasts at least twenty-four months. No other provision in the CBA authorizes the tolling of seniority accrual during layoff. The CBA is clear: The Class members may include the time spent during their final layoff in their seniority, notwithstanding the fact they were never recalled.
But the Appellees contend this unambiguous language must be read in context with the course of dealing at Torrington. Four affidavits, including two from members of the nine-person Local bargaining team that negotiated the 1981 CBA, are offered stating in virtually identical language:
Affidavit of Irving Vinson, ¶ 6 (emphasis in original); Affidavit of Casimir Wisiewski, ¶ 10; Affidavit of Arthur Birk, ¶ 11; Affidavit of Michael H. Matuszak, ¶ 6. No affidavits have been offered to controvert the assertion that Torrington in fact credited seniority for time spent on layoff upon recall.
The Appellees argue that the CBA must be interpreted only in the context of this Company practice. They contend this method of seniority tolling during time of layoff constitutes a course of dealing. Quite correctly, the Appellees point out that the parties to a CBA may tacitly acquiesce to an amendment of the agreement through their course of dealing. See Railway Labor Executives Ass'n v. Norfolk & Western Ry. Co., 833 F.2d 700, 705 (7th Cir.1987); Brotherhood Ry. Carmen v. Norfolk & Western Ry. Co., 745 F.2d 370, 377 (6th Cir.1984).
But we are not persuaded a course of dealing has been established that can help us decide this case. The affidavits indicate a method for calculating seniority accrual during layoff that breaches the express language of the CBA. However, the affidavits do not tell us how this continuous breach ever made a difference in the eyes of the workers. During normal layoffs, a worker would either be recalled and thus get credit for time spent on layoff, or he would not be recalled and thus lose all his seniority. The affidavits offer no example of an actual case when a worker was denied collectively bargained benefits based upon the timing of seniority accrual during layoff. The record indicates no case in which a worker would have been obliged to file a grievance because of Torrington's practice. And so it appears that any course of dealing established by Torrington's seniority accrual practice only has application in cases where that practice makes no difference of consequence. We cannot allow a meaningless Company practice to thwart the express language of a CBA the first time that practice might cause an employee to complain.
Seniority is to be determined according to the precise language of the CBA and is to be accrued continuously from the date of hire. We therefore REVERSE the grant of summary judgment against the Class and REMAND to the District Court for further proceedings to determine who is entitled to benefits given the interpretation of "seniority" we have articulated in this opinion. Circuit Rule 36 shall not apply.