Seven counts, three losses, and one rule that kept the award standing
Think an arbitration loss is fixable on appeal? A Virgin Islands ruling on June 15 shows how rarely courts step in.
The Government of the Virgin Islands found that out the hard way. Its Bureau of Corrections battled a union over overtime pay for correction officers, lost in arbitration, lost at the trial court, and lost a third and final time at the territory's Supreme Court.
The dispute turned on a single clause in a collective bargaining agreement - the contract setting pay and conditions for unionized staff. It said officers earn time-and-a-half for hours past eight in a day, and separately for hours past 40 in a week. The Seafarers International Union, representing the officers, filed grievances in 2012 and 2013 arguing the employer's math came up short. An arbitrator sided with the union.
The employer tried to wipe out that award. It went to court with seven counts seeking to vacate, claiming the arbitrator overstepped and ignored the law. The Superior Court confirmed the award and tossed the employer's complaint. The government appealed.
This is the part worth dwelling on. The Supreme Court said plainly that its job was not to re-decide the overtime question or pick the better reading of the contract. Because both sides had agreed to binding arbitration, the court's review was deliberately narrow: had the arbitrator exceeded his authority, or manifestly disregarded the law? Simply disagreeing with the arbitrator's interpretation, the court said, is not grounds to undo an award.
The government argued the arbitrator had effectively rewritten the contract to allow "pyramiding," meaning overtime paid on top of overtime for the same hours. But the arbitrator had already found that the union's reading did not require that, and the government never engaged with the finding. It also floated a public-sector argument and a federal Fair Labor Standards Act argument for the first time on appeal. The court declined to hear either, because neither had been raised at the trial court.
For HR and labor-relations leaders, the takeaways are concrete. When you agree to binding arbitration in a union contract, you are buying the arbitrator's interpretation - not a draft you can contest later if it disappoints. Preserve every argument early; raising a new theory on appeal is a reliable way to waive it. And vacating an award is hard by design. You must show a clearly defined legal principle the arbitrator flatly refused to follow, not merely a reading you would have done differently.
The ruling is a clean reminder that the value of arbitration - speed and finality - is also its constraint. Courts protect that bargain rather than reopen it.
