Opinion
DOCKET NO. A-6158-12T2
03-09-2015
PATERSON POLICE PBA LOCAL 1, Plaintiff-Respondent, v. CITY OF PATERSON, a municipal corporation of the State of New Jersey, Defendant-Appellant.
Adam S. Herman argued the cause for appellant (Adams Gutierrez & Lattiboudere, LLC, attorneys; Perry L. Lattiboudere, of counsel; Mr. Herman, on the brief). Mark C. Rushfield argued the cause for respondent (Shaw, Perelson, May & Lambert, LLP, attorneys; Mr. Rushfield, of counsel and on the brief).
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION Before Judges Simonelli, Guadagno, and Leone. On appeal from the Superior Court of New Jersey, Chancery Division, Passaic County, Docket No. C-48-13. Adam S. Herman argued the cause for appellant (Adams Gutierrez & Lattiboudere, LLC, attorneys; Perry L. Lattiboudere, of counsel; Mr. Herman, on the brief). Mark C. Rushfield argued the cause for respondent (Shaw, Perelson, May & Lambert, LLP, attorneys; Mr. Rushfield, of counsel and on the brief). PER CURIAM
The City of Paterson (City) appeals the August 1, 2013 order of the Chancery Division confirming an arbitration award resolving a grievance filed by Paterson Police PBA Local 1 (PBA) and police officers Daniel Findlay, Raymond Cusack, and Gary DeStefano. For the reasons that follow, we affirm.
I.
Daniel Findlay and Raymond Cusack began employment as police officers with the City in 1999; Gary DeStefano joined them in 2001. All three officers transferred to police departments in other municipalities pursuant to Intergovernmental Transfer Agreements (ITAs) in 2003 (Cusack and DeStefano) and 2004 (Findlay).
In 2005, Michael Paterson, the City's Director of Public Safety, approached all three officers and offered them re-employment with the City. During negotiations, Paterson assured each of them that they would return to the City with full seniority, compensation, leave entitlement, and benefits under the parties' collectively negotiated agreement (CNA) with their original appointment dates as if they had never left. The only penalty for their time away was that their seniority would be junior to those with the same original appointment date; they would otherwise be credited with their original date of hire "for all contract purposes."
All three transferred back to the City pursuant to ITAs executed on November 10, 2005 (Findlay) and August 18, 2005 (Cusack and DeStefano) (collectively, the 2005 ITAs). From 2005 to 2011, their seniority as to pay, longevity, benefits, leave entitlements, squad selection, extra duty assignments, and vacation selection was calculated using their original (1999 or 2001) hire dates.
In 2011, the City was planning layoffs due to budget concerns. The New Jersey State Civil Service Commission asserted that all three officers had to be treated for layoff purposes as new employees as of their 2005 return dates. The City revised its seniority list to reflect those specifications. As a result, all three officers had significantly lower rankings following the revision.
In addition to calculating layoffs, the City used the revised seniority ranks for assigning monthly details. In October 2011, all three officers selected Squad 3, a night shift in which they had served during the 2010 calendar year by virtue of their original seniority dates. Due to their lower seniority ranks, Findlay and DeStefano were assigned to Squad 1, a day shift, and were not eligible for the five percent night differential pay that they received when assigned to Squad 3. Cusack was assigned to Squad 4, which did have a night differential, but had "much less desirable hours." Had the City used their original seniority dates, all three officers would have been entitled to remain assigned to their first choice, Squad 3. Similarly, all three had inferior status when competing for vacation dates and extra duty assignments by reason of the change in rank.
Findlay, DeStefano, and Cusack filed a grievance on June 6, 2012, alleging violations of § 10.1, § 41.2, and other provisions of the CNA. The parties agreed to arbitrator John E. Sands and stipulated to the submission of three questions for arbitration:
(1) Is the grievance in evidence as Joint Exhibit 2 [the June 6, 2012 grievance] procedurally arbitrable?
(2) If so, did the employer violate the parties' collective bargaining agreement by failing to credit Police Officers Findlay, Cusack, and DeStefano's seniority for pre-break-in service time with the City of Paterson and for pre-break-in service time with other Police Departments?
(3) If so, what shall be the remedy?
On April 18, 2013, Sands issued an award and opinion sustaining the grievance. He first held that the grievance was procedurally arbitrable as a continuing grievance. He found that "[e]ach month [the officers] are assigned to other than the Squad 3 choice to which they would have been entitled gives rise to a new claim for relief."
The arbitrator then held that the City violated CNA §§ 7.1.2 and 10.1 by failing to credit them "pre-break-in service" time. He found that "the relevant provisions of the parties' contract could not be more clear in their application to grievants' claims." Sands found that CNA § 7.1.2 "expressly subjects squad selection to contractual seniority" and that CNA § 10.1 functions to preserve benefits not expressly covered in the CNA but established by past practice, such as the City's practice of recognizing the officers' contractual seniority for the prior six years. Sands also noted that, in compliance with CNA § 7.4, the City's Director of Public Safety had discussed the "major changes affecting an employee's . . . working conditions" with the PBA President "to establish the terms of grievants' returns to service with the City at issue here."
Arbitrator Sands expressly found that N.J.A.C. 4A:4-7.4(c) and the corresponding language in the 2005 ITAs did not preclude using accumulated seniority for the contractual benefits of squad selection, vacation selection, or extra duty assignments, as the ITAs statutorily address seniority only for determining promotional, layoff, or demotional rights, and vacation and sick leave entitlements. He further reasoned that the City had consistently applied the officers' original date of hire for six years for all contractual seniority purposes, including squad selection, vacation picks, and off-duty assignments.
The arbitrator ultimately held that the City "violated the parties' [CNA] by unilaterally changing the officers' contractual seniority dates so that they could not select their squad, extra duty employment, and vacation preferences to which they had been entitled in prior years." He thus awarded the officers the following relief: (1) for officer Findlay, the lost night differential and two hours of pay for each day worked in other than Squad 3 during 2012 and 2013; (2) for officer Cusack, two hours of pay for each day worked in other than Squad 3 during 2012 and 2013; and (3) for officer DeStefano, the lost night differential and two hours of pay for each day worked in other than Squad 3 for a portion of 2012. The compensation was to run from fifteen days prior to the filing of the initial grievance on June 6, 2012 through the end of 2013, in light of Sands' finding that it was a continuing grievance.
DeStefano voluntarily took reassignment to the Community Policing Division in mid-July 2012, so his damages were cut off as of his voluntary reassignment. DeStefano also requested daycare reimbursement, which the arbitrator denied as (1) consequential damages not permitted under contract law and (2) evidentially unsupported.
The PBA filed a complaint seeking to confirm the arbitration award. On August 1, 2013, Judge Margaret Mary McVeigh, issued a written decision and order confirming Sands' award. Judge McVeigh agreed with arbitrator Sands' conclusion that the CNA and surrounding verbal negotiations—and not the 2005 ITAs—were determinative of the officers' contractual seniority rights:
The parties negotiated their return and their contractual seniority status. The Court concedes that the maintaining of two (2) seniority lists may be counterproductive and the Arbitrator's awards are burdensome for the City. However, the Arbitrator heard and considered the evidence. He considered the credibility of the witnesses with regard to past post position as well as the negotiations surrounding the agreement [to] return to Paterson. In light of all the above the award is entitled to confirmation.
On appeal, the City claims that the arbitrator exceeded his authority by finding that the City violated the CNA when it recalculated the seniority list. The City also challenges the finding that the officers were entitled to overtime pay pursuant to section 27.7 and that they were entitled to have their seniority restored for contractual benefits such as vacation selection. Finally, the City claims the arbitration award was procured by undue means because the arbitrator's interpretation of the CNA is not reasonably debatable and the arbitrator ignored witness testimony and documents regarding whether the officers' hours were changed in the course of a monthly detail.
We note that the parties were before us last year when the City raised similar claims challenging another arbitration award resolving grievances filed by the PBA on behalf of other officers. Paterson Police PBA Local 1 v. City of Paterson (Paterson I), No. A-1482-12 (App. Div. Jan. 30, 2014).
II.
New Jersey has a "strong public policy favoring the use of arbitration to resolve labor-management disputes." Policemen's Benevolent Ass'n Local No. 11 v. City of Trenton, 205 N.J. 422, 429 (2011). "In the public sector, an arbitrator's award will be confirmed so long as the award is reasonably debatable." Linden Bd. of Educ. v. Linden Educ. Ass'n ex rel. Mizichko, 202 N.J. 268, 276 (2010). Consistent with the "reasonably debatable" standard, "a reviewing court may not substitute its own judgment for that of the arbitrator, regardless of the court's view of the correctness of the arbitrator's interpretation." Id. at 277. Similarly, an arbitrator is authorized to interpret the submitted issues, and the same reasonably debatable standard applies on appeal. Twp. of Wyckoff v. PBA Local 261, 409 N.J. Super. 344, 355-56 (App. Div. 2009).
"[W]here a collective bargaining agreement provides for binding arbitration, it is the arbitrator's construction that is bargained for, and not a court's construction." Trenton, supra, 205 N.J. at 429. Although the arbitrator is not free to contradict the express language of the contract, "it is the arbitrator's role to fill the gaps." Linden, supra, 202 N.J. at 276. The arbitrator's contract interpretation is controlling, as arbitration is the "vehicle by which meaning and content are given to the collective bargaining agreement." Ibid. As such, we engage in an "extremely deferential review" when a party to a CNA seeks to vacate an arbitrator's award. Trenton, supra, 205 N.J. at 428.
The City argues that the arbitrator exceeded his authority by ignoring the plain language of CNA §§ 6.9.5 and 6.9.6, which limit the arbitrator's role to interpreting the terms of the CNA. The City also claims that the 2005 ITAs operated to waive the officers' accumulated seniority rights.
The stipulated issues define the scope of the arbitrator's authority. In re Arbitration Between Grover v. Univ. Underwriters Ins. Co., 80 N.J. 221, 230 (1979). Because the City stipulated to Sands' determination of the officers' seniority for the contractual benefits at issue, his resolution of the stipulated issue fell squarely within his authority. See Linden, supra, 202 N.J. at 282; Paterson I, supra, slip op. at 16. Indeed, we rejected this same "re-writing" claim advanced by the City in Paterson I:
Contrary to the City's contention, the arbitrator's decision did not re-write or modify the terms of the CNAs. Although an arbitrator is not welcome to contradict the express language of an agreement, a rigid rule that an arbitrator's remedy must be expressly authorized by the bargaining agreement would subvert the purpose of arbitration as a vehicle by which meaning and content are given to the CNA. It is the arbitrator's role to interpret the CNAs and it is this interpretation that both parties agreed to and bargained for in the collective negotiation process. We reject the City's contention that when the arbitrator performed this "gap-filling" function, he impermissibly rewrote or modified the terms of the CNAs.
[Paterson I, supra, slip op. at 29 (emphasis added).]
We reject the City's argument that the ITAs control the officers' contractual benefits for two reasons. First, "seniority" for the purposes of ITAs is statutorily defined. N.J.A.C. 4A:4-7.1A(b)(2) provides that the waiver of accumulated seniority rights by a law enforcement officer as part of an ITA is optional. N.J.A.C. 4A:4-7.4(c) provides:
In the case of an intergovernmental transfer in accordance with N.J.A.C. 4A:4-7.1A, those law enforcement officers . . . who waive all accumulated seniority rights . . . shall not retain such seniority for purposes of determining promotional, layoff or
demotional rights and sick and vacation leave entitlements.Thus, the 2005 ITAs waived the officers' seniority only as to promotional, layoff, demotional, sick leave, and vacation leave rights. By signing the 2005 ITAs, the officers did not waive contractual seniority for purposes of squad selection, vacation preferences, or extra duty assignments.
Second, the 2005 verbal agreements which were reaffirmed and corroborated by the subsequent application of contractual seniority rights to the officers from 2005 through 2011 clearly indicates that the City did not intend for the ITAs to waive the officers' seniority.
We agree with the conclusions of the arbitrator and Judge McVeigh that neither the 2005 ITAs nor N.J.A.C. 4A:4-7.4 precluded recognition of the City's agreement to provide seniority credit to the officers on these three non-regulated benefits.
Next, the City argues that the arbitrator exceeded his authority by finding that the officers were entitled to overtime pursuant to § 27.7 of the CNA. That section provides for two hours pay in addition to payment for the hours actually worked when "in the course of a monthly detail, an employee's days off, or the hours of his tour of duty are rescheduled by more than one (1) hour[.]" While PBA argues that § 27.7 overtime is applicable anytime an officer's assigned detail is increased by more than one hour, the City argues that overtime under § 27.7 applies only when an employee is rescheduled mid-month.
Although we rejected this argument in Paterson I, the City asserts that this case is distinguishable insofar as these three officers were aware of their reassignments at the beginning of the 2012 calendar year, while the officers in that case were reassigned mid-year at the start of April 2011.
In Paterson I, the arbitrator found that "[w]hen the city chose to act unilaterally, with reference to changing tour/squad assignments in violation of the CNAs, it changed the hours of [their] tours of duty by more than one hour . . . [both complaining officers] are therefore entitled to the overtime payment authorized by Section 27.7." Paterson I, supra, slip op. at 23-24. In confirming that award, Judge McVeigh found that:
With regard to the overtime issue this Court finds both arguments equally persuasive. The monthly detail is something that is selected at the start of a yearly work assignment. In this case those assignments were totally upended, and individuals who had selected certain assignments found themselves without the benefit of the compensation for those assignments based upon their seniority. Equally true is the defendant's argument that 27.7 says "whenever in the course of a monthly detail . . ." could refer to a change in shift or tour of duty that occurs [within] a single
month detail. As such the use of the language in the Collective Bargaining Agreement can be ambiguous and is reasonably debatable. The Court is reluctant, therefore, to second guess or substitute its judgment for that of the Arbitrator.We then affirmed Judge McVeigh:
[Paterson Police PBA Local 1 v. City of Paterson, No. C-48-12 (Ch. Div. Oct. 16, 2012) (slip op. at 4-5), aff'd, Paterson I, supra.]
The language in Section 27.7 can be interpreted and applied in multiple ways, and thus is reasonably debatable. When considering the arbitrator's remedy, Lt. McIvor's overtime award was not inconsistent with any of the provisions contained in the CNAs. Moreover, the arbitrator articulated a contractual basis to support his decision that the City's actions constituted a violation, specifically explaining that Lt. McIvor's reassignment in April 2011 violated the terms of Section 36(B) of the CNA because it modified the agreement without an accompanying writing, signed by both parties. Thus, the trial court, in confirming the award, appropriately refused to second guess and/or substitute its judgment for that of the arbitrator, as the record clearly reveals his decision is reasonably debatable.
[Paterson I, supra, slip op. at 21.]
Here, arbitrator Sands found that "PBA is correct that [the Paterson I] Award is dispositive of the issues with respect to sections 29.8 and 27.7, which Superior Court Ju[dge] McVeigh confirmed on October 16, 2012, accepting [the arbitrator's] rationale." Relying on the "reasonably debatable" standard, the fact that arbitration awards are presumed valid, and that courts are not to substitute their judgment for the arbitrator's, Judge McVeigh simply held that Sands' award was entitled to confirmation because Sands' conclusions were based on the evidence, credibility of the parties, and the CNA and surrounding negotiations.
Consistent with our decision in Paterson I, we are satisfied that arbitrator Sands' award of overtime pursuant to § 27.7 was appropriately confirmed below. The remainder of the City's arguments lack sufficient merit to warrant further discussion in our opinion. R. 2:11-3(e)(1)(E).
Affirmed.
I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION