City of Arnold v. Wage Policy Comm. Of Arnold Police Department: Hey Arnold! We’re going to Arbitration

A police widow in Arnold, Pennsylvania (home to Mr. Roger’s Neighborhood Musical Director, Johnny Costa), received 50% of her husband’s pension for several years before a helpful state auditor caught the “mistake.” The city sent her notice of the change, and informed her that her pension would be cut down to 25%, and that the city would graciously enforce a loan repayment plan on the widow in the amount of $10 a month out of her new, lower pension.

The police union filed a grievance, and litigated the matter before an arbitrator, who entered an award on behalf of the widow. The City appealed, arguing the arbitrator lacked subject matter jurisdiction (“SMJ”), despite the fact that their Collective Bargaining Agreement (“CBA”) specifically incorporated pensions disputes by reference.

The Supreme Court held in City of Arnold v. Wage Policy Comm. Of Arnold Police Department that an arbitrator has subject matter jurisdiction for a pension dispute where pensions are incorporated by reference into the governing CBA pursuant to the provisions of Act 111.

Majority by Mundy: Arbitration is Called for under the Act, and the CBA incorporates the pension dispute

 Justice Mundy writes for the majority and lays out the statutory and constitutional background for a CBA: Pennsylvania’s Constitution authorizes the legislature to “enact laws which provide that the findings of panels or commissions, selected and acting in accordance with law for the adjustment or settlement of grievances or disputes or for collective bargaining between policemen and firemen and their public employers shall be binding on all parties.” Pa. CONST. Art. III, § 31. One wonders why such a specific grant of power is necessary in our state constitution, as general grants of power seemingly already made this possible.

Regardless, the legislature followed up, enacting “Act 111,” which regulates CBAs between police and firefighters and the municipalities they serve. Act 111 specifically provides for arbitration of disputes between the parties, and SCOPA caselaw has already ruled that the act is “viewed broadly” to “encompass any subject that is rationally related to the ‘terms and conditions of employment.” City of Arnold, citing Int’l Ass’n of Firefighters, Local 22, 999 A.2d at 564 (Pa. 2010).

Conclusion: This isn’t likely to come up all that often

 This case only bolsters what was already fairly clear in SCOPA caselaw: arbitration is preferred and strongly enforced when it comes to disputes over public CBAs. A city that drafts an agreement with a union should be careful about the “incorporation” language, but that should have been fairly obvious. In the end, this case stands for the unremarkable proposition that you should not incorporate by reference a document into an arbitration agreement unless you are willing to arbitrate over the agreement you’ve incorporated.