Court of Appeal Orders Safety Retirement Dispute to Arbitration
Arbitrator Must Decide Whether Benefit Applies to Prior Service
As reported previously, in March 2002, CAUSE and DPA negotiated an agreement which provided for the transfer of most Bargaining Unit 7 positions which were previously classified as miscellaneous for purposes of retirement, to safety retirement effective July 1, 2004. The agreement, however, was silent as to how prior service was to be treated. The agreement neither expressly excluded prior service, nor did it indicate that such service would be eligible for the enhancement.
On June 15, 2004, shortly prior to the date the reclassification was to take effect, DPA notified CAUSE that it had unilaterally determined the enhancement would not apply to service rendered prior to July 1, 2004. CAUSE then initiated a grievance of DPA's position. However, DPA claimed the dispute did not concern an "express term" of the collective bargaining agreement and therefore, was not subject to arbitration. CAUSE then filed a petition to compel arbitration which was denied by the San Francisco Superior Court. CAUSE filed an appeal of the trial court's decision.
On March 15, 2007, the First District Court of Appeal heard oral argument on the issue of whether the dispute regarding safety retirement retroactivity is subject to arbitration. CAUSE was represented by Gary Messing and Jason Jasmine of Carroll, Burdick & McDonough. DPA was represented by DPA Legal Counsel Kevin Geckeler.
The Court invited the parties to comment on whether Article 6.2 of the CAUSE Contract, which limits arbitration to grievances of the "express terms" of the memorandum of understanding, covered the dispute over the March 2002 settlement agreement negotiated by CAUSE and DPA which authorized the safety retirement benefit.
Gary Messing argued "safety retirement" was an express term of the Unit 7 Contract which was modified by the 2002 settlement. Mr. Messing further contended the omission from the 2002 agreement constituted, at most, a latent ambiguity, or missing term of the contract, which still was required to be ruled on by an arbitrator. Messing pointed to a case involving SEIU where DPA argued that terms which are omitted from the collective bargaining agreement but relate to its subject matter are still subject to arbitration. (Ironically, DPA's position in the SEIU case is directly opposite to the position taken in the case involving CAUSE).
DPA Counsel Geckeler reiterated DPA's position that nowhere in the 2002 settlement agreement were the terms "retroactivity" or "credit for prior service" contained. Geckeler faced intense questioning by the appellate justices. Acting Presiding Justice Mark B. Simons noted the 2002 settlement agreement did expressly address the movement of job classifications (from miscellaneous to safety) which was to occur more than two years after the settlement agreement was negotiated. Justice Simon further noted the settlement was silent on whether service was to be credited for all service, for service prospective of July 1, 2004, or service retroactive to the date the agreement was negotiated.
Justice Simon expressed concern DPA's position was unilaterally determining CAUSE bargaining unit members were not entitled to retroactivity. Justice Linda M. Gemello astutely noted, though the 2002 agreement could have been drafted to specifically address how prior service would be treated, in the political arena involving government and labor organizations, there are often reasons why such agreements are negotiated without all detail.
Geckeler claimed a decision in CAUSE's favor would open the floodgates to claims for other benefits not covered by the Unit 7 Contract, such as free massages. Justice Gemello quickly rebuked Geckeler and reminded him the case concerned a matter of great significance which effected employees' retirement, something far more important than massages.
Based on the appellate court's questioning, there was apparent concern over DPA's position that the merits of the dispute should not be resolved by an arbitrator.
On March 28, 2007, the Court of Appeal reversed the trial court's decision and ordered the dispute to arbitration. The appellate court noted the public policy which favored resolution of public sector labor disputes by way of arbitration. The court also noted that legal precedent required it to separate the issue of arbitrability from the merits of the grievance, but found doing so to be "particularly difficult" in this case. The court opined:
"CAUSE has made a plausible showing that by providing in the March Agreement that the classifications shall be 'moved' to Safety Retirement, the parties intended that their previous years of service be moved to the new retirement category. In other words, pursuant to the memorandum of understanding, all of their previous years of service would be 'subject to the 2.5% at 55 service retirement formula.'"
DPA does have the right to seek California Supreme Court review of the decision. It must do so no later than May 9, 2007. However, such review is discretionary and not a matter of course. The Supreme Court has 60 days (90 if it grants itself a 30 day extension) from the filing of a petition it which to decide whether to grant review. Therefore, should DPA seek review, the Supreme Court should determine whether to grant review no later than August 8, 2007. Should DPA not seek such review or should the court deny review, the decision will be final and the parties will proceed to arbitration.
CAUSE remains optimistic that the arbitration process will be completed and resolved in our favor by the end of the year.
A copy of the decision of the Court of Appeal is attached at the below link.
Arbitrator Must Decide Whether Benefit Applies to Prior Service
Source: Kasey Christopher Clark, General Manager/Chief Counsel
Date: 3/29/2007
As reported previously, in March 2002, CAUSE and DPA negotiated an agreement which provided for the transfer of most Bargaining Unit 7 positions which were previously classified as miscellaneous for purposes of retirement, to safety retirement effective July 1, 2004. The agreement, however, was silent as to how prior service was to be treated. The agreement neither expressly excluded prior service, nor did it indicate that such service would be eligible for the enhancement.
On June 15, 2004, shortly prior to the date the reclassification was to take effect, DPA notified CAUSE that it had unilaterally determined the enhancement would not apply to service rendered prior to July 1, 2004. CAUSE then initiated a grievance of DPA's position. However, DPA claimed the dispute did not concern an "express term" of the collective bargaining agreement and therefore, was not subject to arbitration. CAUSE then filed a petition to compel arbitration which was denied by the San Francisco Superior Court. CAUSE filed an appeal of the trial court's decision.
On March 15, 2007, the First District Court of Appeal heard oral argument on the issue of whether the dispute regarding safety retirement retroactivity is subject to arbitration. CAUSE was represented by Gary Messing and Jason Jasmine of Carroll, Burdick & McDonough. DPA was represented by DPA Legal Counsel Kevin Geckeler.
The Court invited the parties to comment on whether Article 6.2 of the CAUSE Contract, which limits arbitration to grievances of the "express terms" of the memorandum of understanding, covered the dispute over the March 2002 settlement agreement negotiated by CAUSE and DPA which authorized the safety retirement benefit.
Gary Messing argued "safety retirement" was an express term of the Unit 7 Contract which was modified by the 2002 settlement. Mr. Messing further contended the omission from the 2002 agreement constituted, at most, a latent ambiguity, or missing term of the contract, which still was required to be ruled on by an arbitrator. Messing pointed to a case involving SEIU where DPA argued that terms which are omitted from the collective bargaining agreement but relate to its subject matter are still subject to arbitration. (Ironically, DPA's position in the SEIU case is directly opposite to the position taken in the case involving CAUSE).
DPA Counsel Geckeler reiterated DPA's position that nowhere in the 2002 settlement agreement were the terms "retroactivity" or "credit for prior service" contained. Geckeler faced intense questioning by the appellate justices. Acting Presiding Justice Mark B. Simons noted the 2002 settlement agreement did expressly address the movement of job classifications (from miscellaneous to safety) which was to occur more than two years after the settlement agreement was negotiated. Justice Simon further noted the settlement was silent on whether service was to be credited for all service, for service prospective of July 1, 2004, or service retroactive to the date the agreement was negotiated.
Justice Simon expressed concern DPA's position was unilaterally determining CAUSE bargaining unit members were not entitled to retroactivity. Justice Linda M. Gemello astutely noted, though the 2002 agreement could have been drafted to specifically address how prior service would be treated, in the political arena involving government and labor organizations, there are often reasons why such agreements are negotiated without all detail.
Geckeler claimed a decision in CAUSE's favor would open the floodgates to claims for other benefits not covered by the Unit 7 Contract, such as free massages. Justice Gemello quickly rebuked Geckeler and reminded him the case concerned a matter of great significance which effected employees' retirement, something far more important than massages.
Based on the appellate court's questioning, there was apparent concern over DPA's position that the merits of the dispute should not be resolved by an arbitrator.
On March 28, 2007, the Court of Appeal reversed the trial court's decision and ordered the dispute to arbitration. The appellate court noted the public policy which favored resolution of public sector labor disputes by way of arbitration. The court also noted that legal precedent required it to separate the issue of arbitrability from the merits of the grievance, but found doing so to be "particularly difficult" in this case. The court opined:
"CAUSE has made a plausible showing that by providing in the March Agreement that the classifications shall be 'moved' to Safety Retirement, the parties intended that their previous years of service be moved to the new retirement category. In other words, pursuant to the memorandum of understanding, all of their previous years of service would be 'subject to the 2.5% at 55 service retirement formula.'"
DPA does have the right to seek California Supreme Court review of the decision. It must do so no later than May 9, 2007. However, such review is discretionary and not a matter of course. The Supreme Court has 60 days (90 if it grants itself a 30 day extension) from the filing of a petition it which to decide whether to grant review. Therefore, should DPA seek review, the Supreme Court should determine whether to grant review no later than August 8, 2007. Should DPA not seek such review or should the court deny review, the decision will be final and the parties will proceed to arbitration.
CAUSE remains optimistic that the arbitration process will be completed and resolved in our favor by the end of the year.
A copy of the decision of the Court of Appeal is attached at the below link.
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