Opinion
No. 833 C.D. 2014
05-15-2015
The Township of Wilkins, Appellant v. The Wage Policy Committee of The Wilkins Township Police Department (Jon Sherman, Grievant)
BEFORE: HONORABLE RENÉE COHN JUBELIRER, Judge HONORABLE MARY HANNAH LEAVITT, Judge HONORABLE P. KEVIN BROBSON, Judge
OPINION NOT REPORTED
MEMORANDUM OPINION BY JUDGE BROBSON
Appellant Township of Wilkins (Township) appeals from an order of the Court of Common Pleas of Allegheny County (trial court). The trial court confirmed a grievance arbitration award in favor of Wilkins Township Police Officer Jon Sherman. Sherman is represented by the Wage Policy Committee (WPC) of the Wilkins Police Department for collective bargaining purposes. We vacate the trial court's order in part to the extent it awarded damages in the form of lost wages and remand the matter to the trial court with instructions.
On August 8, 2012, Officer Sherman submitted to the Wilkins Township Police Department a form entitled "Off Duty Employment," setting forth notice that Sherman was contemplating off-duty employment at Brewstone's, a bar/restaurant. According to the information Sherman provided on the form, the position at Brewstone's involved checking identification on Thursdays, Fridays, and Saturdays from 12:00 a.m. through 2:00 a.m. Initially, the Chief of Police advised Sherman that no police officer could accept employment at Brewstone's unless the Board of Commissioners (Board) approved the employment. On August 21, 2012, the Board advised Sherman that the employment at Brewstone's was prohibited based upon its conclusion that checking identifications and providing security at a bar constituted a conflict of interest with Sherman's duties as a police officer. (Reproduced Record (R.R.) at 61a.) Sherman filed a grievance with the Board, which denied the grievance. On September 24, 2012, Sherman filed a grievance to proceed to arbitration pursuant to the CBA and in accordance with the law commonly known as Act 111 (Act 111)., The primary focus of Sherman's grievance arbitration request was to challenge the Board's conclusion that the proposed off-duty employment constituted a conflict of interest.
The collective bargaining agreement (CBA) between the Township and WPC contains a multi-step grievance process, and it appears that this action of the Board was a denial of Sherman's grievance at the third-step of the grievance process. (R.R. at 45a.)
Act of June 24, 1968, P.L. 237, as amended, 43 P.S. §§ 217.1-.10. Act 111 is also sometimes referred to as the "Policeman and Fireman Collective Bargaining Act."
Our Supreme Court has described grievance arbitration as concerned with the resolution of disputes regarding the interpretation of an existing collective bargaining agreement. Town of McCandless v. McCandless Police Officers Ass'n, 901 A.2d 991 (Pa. 2006).
Article XX(F) of the CBA provides:
Self-Employment: Full-time officers may engage in outside or self-employment activities; however, the employment with the Township is deemed the primary employment. Police officers may be required to notify the Chief of Police of the names of their outside employers and the type of work they do, as well as their schedule for outside employment. The Township may require the officer to refrain from excessive levels of outside work which would tend to render the officer unfit for duty and to refrain from outside employment which would tend to bring disrepute on the office or would constitute a conflict of interest.(R.R. at 47a.) Additionally, the Wilkins Township Police Department Manual of Rules and Regulations provides:
If an off duty employment situation held by a member is found to interfere with (1) The Department's image or efficiency, (2) The on duty business or work performance of the individual in question, or (3) Is found to be inconsistent or in conflict with the member's duties as a police officer, the member may be required to terminate such employment.
. . . .
(R.R. at 48a.)
The primary obligation and responsibility of a member who engages in off duty employment must be to the Department. Members directed to report for overtime work will do so regardless of their off[-]duty employment situation.
On May 20, 2013, the appointed Arbitrator conducted a hearing. According to the Arbitrator's opinion and award, he permitted the submission of briefs, which the parties apparently "exchanged" on June 17, 2013. (Arbitrator's Opinion and Award, p.1 (R.R. at 47a).) In his Opinion and Award, the Arbitrator noted that the issue in the grievance, as agreed upon by WPC and the Township, was "whether the Township violated the [CBA] when it refused to allow [Sherman] to engage in outside employment at Brewstone's." (Arbitrator's Opinion and Award, p. 3 (R.R. at 49a).) The Arbitrator rendered factual findings, which we summarize below.
Sherman has worked for the Township as a police officer for approximately fourteen years. Brewstone's, a bar/restaurant, approached Sherman, asking him if he would work there as secondary checker of identifications, where a bartender or hostess suspected an identification was not authentic. Sherman would not wear a uniform, serve alcohol, or act as a bouncer. If he were to believe that someone had offered a fake identification, he would call the police department. With regard to potentially problematic situations, the Arbitrator specifically found that if Sherman were to find a fake identification, "[h]e would tell the individual he was [calling the police], but would not attempt to stop the person if he or she left. If a fight occurred, he would also call the [d]epartment." (R.R. at 48a.) Additionally, the Arbitrator found that "[i]n general, when not on duty, if Sherman saw a crime being committed, he would not intervene, unless it was a life threatening situation, but would consider himself duty bound to report the matter to the appropriate police department." (Id.)
With regard to the issue before the Arbitrator, WPC asserted that the proposed off-duty employment would not create a conflict of interest in light of the fact that the position does not call upon Sherman to act in the capacity of a police officer, but, rather, only requires him to evaluate potentially fake identifications and to call on-duty police for assistance. The Township asserted that a police officer's employment in a bar/tavern creates a conflict of interest. The Arbitrator upheld Sherman's grievance and also ordered that the Township should "make [Sherman] whole for the net ('take home') earnings he lost as a result of its forbidding him from [working at Brewstone's.]" (R.R. at 51a.) The Township filed a petition to vacate the award with the trial court, challenging the Arbitrator's award of lost earnings on two grounds: (1) lack of jurisdiction of the Arbitrator to award lost wages when Sherman did not raise the issue of lost wages before or during the hearing, but rather raised the issue in his post-hearing brief to the Arbitrator; and (2) violation of due process where Sherman did not raise the issue of lost wages in the grievance notice or during the Arbitrator's hearing.
The Arbitrator concluded:
Under the facts of this case, it does not appear that employment at Brewstone's in the manner described would create a conflict of interest. The undisputed evidence is that the establishment is an upscale, family place as distinguished from a nuisance bar or one where an officer's presence would serve to legitimize a questionable establishment.(R.R. at 50a.)
The duties described would not involve condoning or even punishing, but rather preventing, underage drinking and the undesirable conduct, including driving under the influence, that may result. Preventing minors from obtaining alcohol seems to me consistent with the interests of the Township and its residents, rather than in conflict with those interests. Checking IDs, like working security at an athletic event or a retail establishment, helps to deter and prevent criminal activity and if anything furthers the interest of the Employer in preserving the peace.
The Township also asserted that the Arbitrator exceeded his powers, but the Township has not pursued that line of argument in its appeal.
The trial court affirmed the Arbitrator's award, concluding that the award does not provide for a specific amount of lost wages, but rather lays the framework for a "back pay hearing." The trial court reasoned that the Township's due process rights have not yet been affected, as no dollar amount has been determined. Also, the trial court noted that the Arbitrator had the authority to enter an award that addressed the harm Sherman alleged to have occurred—i.e., the inability to accept the off-duty position, which, the trial court opined included lost pecuniary opportunities. The trial court also reasoned that any evidence that the Township could have offered during the hearing relating to potential damages could have prolonged the hearing, such that the answer to the essential inquiry—whether the Township violated the CBA—would have taken longer to resolve: "[I]t is better to focus on liability and downplay damages else the liability may be lost in the minutiae of the damages." (Trial Court Opinion at 4.) The trial court did not comment on the fact that Sherman himself offered no evidence regarding the amount of lost wages he might have sustained.
The certified record from the trial court does not include the hearing transcript from the Arbitrator's hearing, and Sherman has not suggested that he offered any evidence pertinent to the amount of lost wages.
The Township raises the following issues before this Court: (1) whether the inclusion in the award of an as-yet undetermined amount of lost wages violates the Township's procedural due process rights; and (2) whether the Arbitrator lacked jurisdiction to consider the lost-wages issue based upon the allegation that Sherman failed to raise the issue in a timely manner.
During oral argument, the Township suggested that, in addition to challenging the actual award of lost wages, it was also challenging Sherman's purported right under the CBA to obtain lost wages for the off-duty position. Our review of the Township's brief, however, indicates that, with regard to its constitutional due process claim, the Township only challenges the failure on the part of the Arbitrator to provide a forum for submission of evidence relating to the amount of lost wages. As indicated in the summary of argument portion of the Township's brief, the Township claims that error occurred because it "was unable to present evidence or question any parties regarding any issues that involved payment arrangements between Brewstone's and Officer Sherman." (Appellant's br. at 9-10.) On the other hand, in its argument challenging the Arbitrator's jurisdiction to address the lost-wages claim, the Township's argument is two-fold. First the Township claims, in general, that the Arbitrator lacked jurisdiction to address Sherman's right to lost wages. Second, the Township claims that, because of the lack of notice that Sherman was seeking lost wages as a measure of damages, there is no evidence to support an award of lost wages.
In a grievance arbitration matter arising under Act 111, such as this one, our narrow scope of review limits the objections to an award that we may consider. Pennsylvania State Police v. Pennsylvania State Troopers' Ass'n (Betancourt), 656 A.2d 83, 85-86 n.4 (Pa. 1995). The only grounds that we may evaluate to support a reversal of an arbitrator's award are limited to the following: (1) awards that are outside the jurisdiction of the arbitrator; (2) awards that are the result of irregular proceedings; (3) awards that reflect an excess of the arbitrator's powers; and (4) awards that are made where a violation of a party's constitutional rights has occurred. Fraternal Order of Police, Flood City Lodge No. 86 v. City of Johnstown, 39 A.3d 1010, 1012 n.8 (Pa. Cmwlth. 2012).
Jurisdiction
In Bensalem Township v. Bensalem Township Police Benevolent Association, Inc., 803 A.2d 239 (Pa. Cmwlth. 2002), this Court addressed a factual situation similar to the one at hand. In Bensalem, an arbitrator sustained a grievance filed by a police officer who claimed that the township failed to follow the terms of the collective bargaining agreement regarding the discharge of police officers. The arbitrator not only fashioned an order calling for the officer's reinstatement, but also directed the township to pay the officer back pay for the entire period during which he had lost his position. The award was directly at odds with a provision in the collective bargaining agreement that placed a twelve-month back pay limitation on monetary grievance awards. The township filed a petition in the nature of an application to modify the arbitrator's award with the trial court, claiming that the arbitrator exceeded his jurisdiction in so doing. The trial court in that matter denied the township's petition and affirmed the arbitrator's award.
While noting the rule that arbitrators exceed their jurisdiction by addressing questions the parties had not submitted, we observed that if we were to hold that an arbitrator exceeded his or her jurisdiction every time a decision is not in accord with a collective bargaining agreement, such a test would be no different from the essence test that is applied in public and private grievance arbitration awards, which are not governed by Act 111. We held that "[b]ecause the jurisdiction of an arbitrator goes to his or her power to decide an issue in dispute rather than to his or her fashioning of an award, we need only decide if [the arbitrator] had jurisdiction to address the issue in dispute." Bensalem, 803 A.2d at 243.
We believe that the question of whether the Arbitrator exceeded his jurisdiction by awarding lost wages is controlled by our holding in Bensalem. In this case, the primary issue involved concerns the Board's decision that the CBA terms authorized it to refuse Sherman's request to accept an off-duty employment position, and the remedy the Arbitrator determined to be appropriate in order to make Sherman whole encompassed an award of lost wages. While we recognize that there is a distinction between the question of whether a CBA contemplates a particulate type of award and the question of how to determine the amount of an award, our holding in Bensalem does not indicate that such a distinction is material in the context of a challenge to an arbitrator's jurisdiction. As in Bensalem, the jurisdiction claim the Township raises here concerns the award the Arbitrator fashioned. Thus, in this case, where the parties submitted to the Arbitrator the issue of whether the Township violated the CBA by refusing to permit Sherman to work, the Arbitrator properly exercised his jurisdiction over that issue.
Due Process
Bensalem, unlike this case, did not involve a claim that an arbitration decision or award violated a party's due process rights. Thus, the holding in Bensalem does not apply to our analysis concerning the Township's due process argument.
The Township also argues that the Arbitrator violated its procedural due process rights by ruling on the lost-wage issue when Sherman did not raise that issue before the Arbitrator or discuss the issue during the arbitration hearing. The Township points out that WPC did not raise the issue until the final paragraph of the post-hearing brief that it submitted to the Arbitrator, where it asserted that "Sherman should be made whole for the improper denial of the position." (R.R. at 66a.) The Township argues that its due process rights were implicated, because it was not afforded an opportunity to respond to the question of whether Sherman should be awarded lost wages and, if so, how much should be awarded.
In its brief, WPC specifically referred to the hours Sherman presumably would have worked, which is also reflected in the request form, i.e., three hours per night, three nights per week. (Appellee's br. at 9-10.) WPC suggests that the award be quantified by reference to the "outside employer's hourly rate," but WPC does not point to any place in the record where the hourly rate was placed in the record. Thus, WPC does not appear to have offered any other evidence that might help quantify an amount of damages for lost wages. Thus, in contrast to the assertions in the brief, it appears that Sherman failed in making his own case before the Arbitrator, and, contrary to WPC's claims, the record lacks any meaningful means by which to establish Sherman's alleged lost wages.
In response to the Township's argument, WPC contends that the Township had an opportunity to object to the request Sherman made in his post-hearing brief at that time, but did not object until after the Arbitrator issued its decision. Also, WPC argues that an Act 111 arbitrator may retain jurisdiction over a matter and that, therefore, in this case, the Arbitrator could and should conduct a hearing on the issue of damages, thus providing an opportunity to the Township to offer evidence of its own in opposition to the amount of lost wages that might ultimately be awarded.
The Township relies upon our Supreme Court's decision in City of Philadelphia v. Fraternal Order of Police Lodge No. 5, 985 A.2d 1259 (Pa. 2009) (Breary). In Breary, the Supreme Court affirmed this Court's holding in which we reversed a grievance arbitrator's award, because we concluded the arbitrator violated the procedural due process rights of the City of Philadelphia. In Breary, the arbitrator had precluded the City from presenting certain evidence during the arbitration hearing because of the City's failure to comply with a subpoena. The Supreme Court concluded that the particular action of the arbitrator at issue in that case constituted a discovery sanction, not an evidentiary ruling. The question before the Supreme Court was whether the arbitrator's imposition of the sanction was reviewable, and if so, whether the preclusive evidentiary effect of the discovery sanction fell outside the bounds of due process.
Although this case, unlike Breary, does not involve the resolution of the actual subject of the grievance, i.e., whether the CBA permitted Sherman's proposed off-duty employment, we conclude that the Supreme Court's reasoning is applicable here. The Supreme Court, in concluding that the Arbitrator's award violated the City's due process rights, was concerned with an arbitration panel's "potential to affect the substantive and fundamental rights of parties." Breary, 985 A.2d at 1266. In this matter, there can be no dispute that an award that provides for a type of relief that encompasses an unidentified monetary amount, where the record contains no evidence from the proponent or the defending party, implicates due process concerns.
Here, while there may be some alternative forum that might be available for the Township to present evidence concerning an amount of lost wages, if any, we cannot ignore what transpired, or did not transpire, before the Arbitrator. The Arbitrator proceeded to consider and award to Sherman an unidentified amount of damages for potential loss of off-duty wages without examining the question of whether Sherman actually lost wages. The Arbitrator failed to provide the Township with an opportunity to present evidence that Sherman did not experience any lost off-duty wages or, if he did lose some off-duty wages, the amount of those lost wages. Such an action is more than an evidentiary ruling; it is one that deprived the Township of a party's right to litigate fully an issue that is of essence to the Arbitrator's award. Moreover, Sherman failed to offer evidence concerning his alleged lost wages. Unlike other cases where an arbitrator may be able to discern back pay amounts based upon the terms and conditions set forth in a collective bargaining agreement, in a case such as this where such information is likely in the hands of third parties, it was improper for the Arbitrator to issue an award that was silent as to the amount of lost wages. Consequently, we conclude that the Arbitrator's action of issuing an award providing for lost off-duty wages, without any record support for such an award, and failing to provide the Township with an opportunity to refute the claim, triggered a violation of the Township's due process rights. Breary. The Township did not engage in any impropriety during the course of the Arbitrator's hearing, as occurred in Breary, such that the Arbitrator could preclude the admission of such evidence. Nevertheless, the Arbitrator essentially precluded the Township from presenting evidence by addressing the issue at such a late stage in the proceedings.
We find no merit to the two arguments WPC makes regarding (1) the fact that the Township did not submit any post-briefing response to WPC's lost wages request before the Arbitrator issued his decision; and (2) an arbitrator's power to retain jurisdiction over a grievance proceeding. First, we reject WPC's argument suggesting that the Township may have waived its right to challenge the Arbitrator's award by failing to submit some argument to the Arbitrator before he issued his decision. We see nothing in the record that authorized the Township to submit a reply brief to the Arbitrator. Without additional argument on this claim or facts that would support this alleged waiver, we conclude that no waiver occurred. With regard to WPC's assertion that an arbitrator has the power to retain jurisdiction to ensure compliance with an award, we note that, while an arbitrator may indeed have such power, the Arbitrator in this case did not expressly retain jurisdiction. --------
Accordingly, we will vacate that part of the trial court's order awarding lost wages and remand the matter to the trial court with the direction to remand to the Arbitrator to take whatever procedural measures are required to determine whether Sherman is entitled to damages, and, if so, the amount of damages.
/s/_________
P. KEVIN BROBSON, Judge ORDER
AND NOW, this 15th day of May, 2015, the order of the Court of Common Pleas of Allegheny County is VACATED, in part, to the extent that it awarded damages in the form of lost wages. The matter is REMANDED to the trial court with the instruction to REMAND the matter to the Arbitrator for further proceedings in accordance with our opinion.
Jurisdiction relinquished.
/s/_________
P. KEVIN BROBSON, Judge