What’s On Their Minds: Arbitrator’s Powers in Police Disciplinary Action. Ohio Patrolmen’s Benevolent Ass’n, et al. v. City of Findlay.

“Isn’t the issue whether the arbitrator was bound by the matrix…?”                                            Justice French

On February 7, 2017, the Supreme Court of Ohio heard oral argument in the case of Ohio Patrolmen’s Benevolent Ass’n, et al. v. City of Findlay, 2015-Ohio-1581. At issue in this case is the extent of the arbitrator’s power to fashion a disciplinary penalty.

Case Background

Appellant, David Hill, was a sergeant with the Findlay Police Department. Appellee, the city of Findlay (“City”), and Appellant Ohio Patrolmen’s Benevolent Association (“the Union”), are parties to a Collective Bargaining Agreement (“CBA”). Hill was a member of the bargaining unit covered by the CBA. The CBA requires that disciplinary matters be resolved through the CBA’s grievance-arbitration procedure.

On November 21, 2012, Morgan Greeno, a police officer with the Findlay Police Department, filed a harassment complaint with the department regarding an incident that had occurred with Hill, who was her direct supervisor. The incident, occurring on November 13, 2012, took place during a conversation after midnight roll call in which Hill referred to Greeno as “Whoregan,” a perceived combination of the word “whore” and Greeno’s first name, Morgan. The entire shift was in the room when the comment was made.  Hill also allegedly made or allowed disparaging comments about Greeno having a sexual relationship with the building’s custodian.

In the investigation of Greeno’s complaint, Hill admitted that he had referred to Greeno as “Whoregan,” but claimed it was just an unintentional slip of the tongue. He denied comments about a sexual relationship between Greeno and the custodian, asserting that the comments of her fellow officers were typical roll call banter. The investigating officer determined that Hill’s conduct was deliberate, and that he had violated a number of department rules. That, combined with a review of Hill’s personnel file and past disciplinary record, resulted in a determination by the police chief that based on a past pattern of egregious and unacceptable conduct, and the lack of any effect on Hill of prior disciplinary action, Hill should be terminated. The Chief indicated that he had followed the department’s Discipline Matrix (“the Matrix”) in deciding to terminate Hill. Read more about this in detail in the oral argument preview of the case here.

The Grievance

Following receipt of the notice of termination, Hill filed a grievance, claiming that his termination lacked just cause under the CBA. Hill was represented by the Union. A hearing took place before the City’s service-safety director, who further investigated the incident. The safety director agreed that Hill should be terminated.

Arbitration

Hill and the Union challenged Hill’s termination, and the matter proceeded to arbitration. The arbitrator found that the City had proven that Hill had engaged in conduct unbecoming an officer, and thus there was just cause to impose severe discipline, but also found that the City had not established sexual harassment or a hostile work environment based on a single incident. The arbitrator modified the penalty from termination to a five month suspension and reinstatement without back pay. In doing so, the arbitrator indicated that he had used the Matrix as a guideline, but was not bound by it in fashioning a penalty.

Appeals

Despite the arbitration award, the City did not reinstate Hill. Hill and the Union filed an application in the Cuyahoga Court of Common Pleas to confirm and enforce the arbitration award. The City filed a separate application to vacate the arbitration award. The trial court consolidated the cases, granting the city’s motion to vacate and denying the Union’s motion to confirm the award, finding that the arbitrator had exceeded his authority by failing to properly apply the Matrix, and had thus acted arbitrarily and capriciously.

Hill and the Union appealed, and in a 2-1 decision authored by Judge Eileen A. Gallagher and joined by Judge Jones, the Eighth District upheld the trial court decision. Judge Boyle dissented, believing that the arbitrator did not exceed his authority because the City’s disciplinary procedures were not expressly a part of the CBA.

The role of the Discipline Matrix in the grievance procedure is at the heart of this appeal. The Union argues it is a guideline only, and was never bargained for or incorporated into the CBA. The City argues it is binding, as part of the CBA, and should have been applied in Hill’s case.

Key Precedent

Provisions of the CBA

Article 4.01 of the CBA (Management Rights Provision)(“Unless expressly provided to the contrary by a specific provision of this Agreement, the Employer reserves and retains, solely and exclusively, all of its statutory and common law rights to manage the operation of its Department of Police. Such rights shall include, but are not limited to, the following: (a) to develop, revise, or eliminate work practices, procedures and rules in the operation of the Department of Police and to maintain discipline; . . . (c) to transfer, promote or demote employees, or to layoff, terminate or otherwise relieve employees from duty for just cause.”)

Article 10.01 of the CBA (“The Union agrees that its membership shall comply with Police Department and City of Findlay Rules and Regulations, including those relating to working conditions, conduct, and performance. The Employer agrees that Police Department and City of Findlay Rules and Regulations, which affect working conditions, conduct, and performance shall be subject to grievance procedure if they violate this Agreement.”)

R.C. 2711.10(D) (“In any of the following cases, the court of common pleas shall make an order vacating the award upon the application of any party to the arbitration if . . . (D) The arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final, and definite award upon the subject matter submitted was not made.”)

R.C. 4117 (Ohio Public Employees Collective Bargaining Act)

R.C. 4117.08(A) (“All matters pertaining to wages, hours, or terms and other conditions of employment and the continuation, modification, or deletion of an existing provision of a collective bargaining agreement are subject to collective bargaining between the public employer and the exclusive representative, except as otherwise specified in this section and division (E) of section 4117.03 of the Revised Code.”)

Southwest Ohio Regional Transit Authority v. Amalgamated Transit Union Local 627, 91 Ohio St.3d 108; 742 N.E.2d 630 (2001) (adoption of immediate dismissal as a sanction for violating a drug policy conflicted with CBA’s terms allowing termination only for sufficient cause.)

Summit County Children Services Bd. v. Communication Workers of America, Local 4546, 2007-Ohio-1949, 113 Ohio St.3d 291 (where “good cause” was undefined in CBA, arbitrator could use the Daugherty test to determine whether good cause existed to terminate an employee.)

Mahoning Cty. Bd. of Mental Retardation v. Mahoning Cty. TMR Educ. Assn., 22 Ohio St.3d 80 (1986) (An arbitrator’s award should be upheld if it draws its essence from the CBA; it does so when there is a rational nexus between the CBA and the award, and when the award is not arbitrary, capricious or unlawful. “The whole purpose of arbitration would be undermined if courts had broad authority to vacate an arbitrator’s award.”)

Findlay City Sch. Dist. Bd. of Educ. v. Findlay Educ. Assn., 49 Ohio St.3d 129 (1990) (presumption of validity of an arbitrator’s award)

Board of Trustees of Miami Township v. Fraternal Order of Police, OLC, Inc., 81 Ohio St.3d, 269 (1998) (“‘just cause’ requires the arbitrators to make two determinations in considering cases: (1) whether a cause for discipline exists and (2) whether the amount of discipline was proper under the circumstances.”)

At Oral Argument

Arguing Counsel

Joseph M. Hegedus, Ohio Patrolmen’s Benevolent Association, Columbus, for Appellants Ohio Patrolmen’s Benevolent Association and David Hill

William F. Schmitz, Allain Legal, Ltd, North Olmstead, for Appellee City of Findlay

Union’s and Hill’s Argument

The stipulated issue in this case is whether there was just cause to terminate Sargent Hill, and if not, what was the appropriate remedy. In such disciplinary proceedings, the arbitrator engages in a two part review: whether the employee engaged in the misconduct alleged and whether the penalty is appropriate under all of the circumstances. It is settled law that in the absence of specific language in the CBA, an arbitrator has broad remedial powers to fashion a remedy. In this case, the arbitrator engaged in the appropriate just cause review. He considered the conduct of the grievant, all the charges against him, and decided that some of the charges, but not the most serious of the charges—sexual harassment and a hostile work environment– were proven by the City. Thus, he decided termination was not the appropriate remedy in the case. In doing so, he appropriately used the Discipline Matrix as a guideline only.  In fact, the City itself argued exactly that in a 2012 arbitration also involving Hill, but with a different arbitrator.

The Arbitrator in this case was correct in referring to the Matrix as a guideline. The Matrix does not stand alone. The Matrix itself contains language expressly indicating that it is a guideline, and it is attached to a larger policy. It is an appendix to a City policy that was never negotiated between the parties, was not attached to the contract, was not referred to by the contract, and had never been approved by the Union as some sort of amendment to the contract.

The courts below were incorrect in finding that the Matrix was somehow a part of the CBA and therefore could not be deviated from. Article 46 of the CBA clearly indicates that any appendix or amendment to the CBA must be in writing and signed by the parties. There is no evidence that there was any negotiation or signed tentative agreement to include an amendment to the contract that included the disciplinary procedure or the Matrix. The policy to which the Matrix is attached is the process for investigation and discipline of employees, not the rules and regulations governing the performance or conduct of employees.

Nor does the Management Rights Provision of the CBA save the day for the City because it begins, “except as more specifically set forth otherwise in this agreement.” The just cause provision in the disciplinary article of the CBA trumps the general management rights that are contained in the contract.

The Union would never have agreed to the promulgation of a rule that essentially writes “just cause” out of the contract.

City’s Argument

Article 10 of the CBA begins with the proposition that the Union agrees that all members will abide by the Findlay police department rules and regulations. This gave the City the right to create the Matrix because it mentions conduct and performance. Article 10 further states that if the City changes or amends the rules it must give 14 days notice to the Union, and the Union then has the right to grieve the proposed rule changes. No grievance was filed over adoption of the Matrix, which predetermines the discipline about to be rendered. The Matrix is not attached to the CBA because under Article 10 it does not need to be.

In this case the arbitrator would be able to determine whether or not the charged offenses were committed, and whether there were any factors that could mitigate the conclusion about the offense that was committed, but the punishment would be predetermined. There is no leeway in the use of the Matrix in the determination of the penalty, either by the police chief or the arbitrator. Everything turns on the language in the contract.

What Was On Their Minds

The CBA

Does the just cause provision of the CBA trump the Matrix in this particular disciplinary hearing, asked Chief Justice O’Connor?

Is the Matrix attached to the CBA, asked Justice French? Doesn’t Article 26 require that it be attached?

Does the just cause provision of the contract simply mean that the arbitrator only makes sure that the police chief follows the Matrix, asked Justice DeWine? Is that what the arbitrator is limited to? If that is correct, how could an arbitrator consider mitigating factors?

The Management Rights Clause

Does this clause mean the city gets to set new rules, asked Justice French? If the city can unilaterally change the rules that are then incorporated into the CBA why even have an arbitrator?

The Arbitrator’s Findings

Didn’t the arbitrator find no sexual harassment or hostile work environment, asked Justice French ? (answer: yes, both sides agreed) So wouldn’t it make sense if the two most serious charges are removed to reduce the penalty? Didn’t the police chief also have discretion to choose a penalty other than termination?

What level of discipline did the Arbitrator find appropriate, asked Chief Justice O’Connor? Level 4 or level 5?

The Disciplinary Policy and the Matrix

Was the Matrix and the disciplinary procedure ever considered an unratified amendment to the contract, asked Chief Justice O’Connor? The Union never grieved its promulgation? Is there anything in the CBA proper, comparable to the Matrix, that sets forth penalties for certain behavior? If not, where else would that come from, if the CBA is silent and the Matrix is just a guideline? Is it proper to use the Matrix as a guideline in fashioning a penalty? What about the language that says the police chief has the sole discretion to choose a sanction? Couldn’t the chief have chosen a lesser penalty here?

Is the Matrix a rule or a regulation, asked Justice DeWine? How do “levels of discipline” fit into contract language about procedures and regulations? A penalty isn’t usually a rule, is it? Isn’t a rule something that proscribes conduct, but the Matrix really doesn’t do that, does it? Would the court have to overrule the SORTA case to find for the City?

Are the disciplinary proceedings and the Matrix only applicable to the police department, asked Justice O’Donnell? But the Matrix isn’t applicable here because it was never collectively bargained for? It could only be binding if incorporated into the CBA?

Isn’t the issue whether the arbitrator was bound by the Matrix, not whether the city had the authority to adopt a Matrix, asked Justice French? Did the city create the Matrix and the discipline policy unilaterally? Was it bargained for? Are rules about working conditions and a disciplinary policy two different things? And why, in a previous arbitration, did the City argue the Matrix was not controlling, but only a guideline? Is the Matrix part of a larger discipline policy?  Does that policy itself give some leeway in terms of the use of the Matrix?

If the Matrix is binding, why have arbitration at all, asked Justice O’Neill? Can the arbitrator go outside the contract?

 How it Looks from the Bleachers

To Professor Emerita Bettman

My student contributor Connie Kremer and I disagree on this one. I see this as more likely a win for the Union. Justices French, DeWine, and O’Neill seemed to be buying the Union argument that the Matrix was never bargained for, was not part of the CBA, and was not binding on the arbitrator in fashioning a penalty in this case. But with Justices Kennedy and Fischer saying nothing, and Justice O’Donnell saying surprisingly little, it’s not obvious where the 4th vote will come from to find for the Union. Justice Kennedy did vote to accept the case, while the Chief and Justice O’Donnell did not.  Chief Justice O’Connor seemed the one most buying into the City’s argument that the express language of the CBA gave the City the right to promulgate rules upon notice and the right to grieve, and the Union never protested the Matrix.  I found the union’s argument that it would never have let that pass more persuasive.  Justice French really led the charge here, and seemed most engaged in this argument, immediately challenging the City’s lawyer when he said the case was about whether the city had the right to create the Matrix, expressly disagreeing, and stating that she saw the case as whether the arbitrator was bound by the Matrix.  And the fact that the City had argued in an earlier arbitration that the arbitrator wasn’t bound by the Matrix seemed to bother her, although each side used that in its argument.  Justice DeWine really drilled down about whether the Matrix was or wasn’t a rule, but seemed to be siding with the Union, and gave Mr. Schmitz a hard time. For the Union, Mr. Hegedus seemed very sure and focused, in front of a crowd not notoriously pro labor.

To Student Contributor Connie Kremer

It seems to me that this case turns on whether the discipline Matrix is a rule or regulation properly implemented by the City and adopted by the Union through its inaction. I think the arguments favor a finding that the Matrix is a term of the CBA to which the parties are bound.

The City has support in the fact that the CBA allows it to make rules, providing the Union 14 days to contest the rules. In this case, all officers signed upon receipt of the disciplinary Matrix, and the Union never grieved its implementation. Further support is found in the prior arbitration decision in which a suspension was reduced in favor of compliance with the disciplinary matrix. The reasoning of this prior arbitration decision was not appealed by the Union. The Union had an opportunity to grieve the rule and chose not to do so, and arguably adopted the Matrix by failing to contest it.

On the other hand, is it a rule? The Union argued that the CBA allows the City to implement rules and regulations regarding officer conduct, performance or working conditions. Since the discipline matrix does not prescribe behavior—rather, it defines punishments—the Union stated that it is not a rule or regulation that the officers must follow under the CBA.

The Union argued that, since it is not a rule, the Matrix cannot be binding on the Union simply on the grounds that its implementation was not grieved. On this point, Justice DeWine pointed out a bit of circular logic on the part of the City—essentially that the Matrix is a rule because the CBA allows the City to make rules.

I think the plain language of the CBA will overcome this misstep in counsel’s oral argument. Section 10.01 of the CBA states: “The Union agrees that its membership shall comply with Police Department and City of Findlay Rules and Regulations, including those relating to working conditions, conduct, and performance.” I would have liked to hear more from both sides about the specific wording of the CBA. I think the Justices will ultimately determine that the Matrix is a rule relating to officer conduct as is permitted under § 10.01 of the CBA, and that, by its silence, the Union adopted the matrix.

 

 

 

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