Michael G. Lutz Lodge No. 5, of the Fraternal Order of Police v. City of Phila.

129 A.3d 1221

MICHAEL G. LUTZ LODGE NO. 5, OF the FRATERNAL ORDER OF POLICE, Appellant

v.CITY OF PHILADELPHIA, Appellee.

No. 42 EAP 2014

Supreme Court of Pennsylvania.

Argued May 5, 2015.

Decided Dec. 21, 2015.

Stephen J. Holroyd, Esq., Thomas W. Jennings, Esq., Jennings Sigmond, P.C., for Michael G. Lutz Lodge No. 5 of the Fraternal Order of Police.

Erin Kathleen Clarke, Esq., Meredith Celia Swartz, Esq., Ballard Spahr LLP, Shannon Druri–Lanessa Farmer, Esq., Ballard Spahr Andrews & Ingersoll, L.L.P., for City of Philadelphia.

OPINION

Justice TODD.

In this appeal by allowance, we consider the breadth of the authority of an interest arbitration panel acting pursuant to the Policemen and Firemen Collective Bargaining Act ("Act 111").¹ For the reasons that follow, we find that an interest arbitration panel's authority is limited to addressing issues properly submitted to the panel, or those questions reasonably subsumed within those issues. As we conclude the panel in this matter exceeded its authority by speaking to an issue that was neither bargained over, raised in prior related proceedings before the panel, nor reasonably subsumed within the issue that was properly before the panel, we reverse the order of the Commonwealth Court which affirmed the underlying interest arbitration award.

The facts underlying this matter are not in dispute. June 30, 2009 marked the expiration of the collective bargaining agreement between Appellee, the City of Philadelphia ("City"), and Appellant, the Michael G. Lutz Lodge No. 5 of the Fraternal Order of Police ("FOP"), which is the exclusive collective bargaining representative for the bargaining unit of Philadelphia police officers. After negotiations to reach a successor contract failed to resolve bargaining disputes directly, the parties proceeded to binding interest arbitration, pursuant to Section 4 of Act 111, 43 P.S. § 217.4.² After numerous days of hearings, spanning five months, on December 18, 2009, the interest arbitration panel ("Panel") issued an award ("2009 Award") which spoke to certain specific disputed issues, and put into place a new collective bargaining agreement extending from July 1, 2009 through June 30, 2013 ("Agreement"). Except as modified by the 2009 Award, all other terms of the prior collective bargaining agreement remained in effect. 2009 Award, § 23.

One issue before the Panel, which is the focus of this appeal, concerned advance notification and premium overtime for police officers for court appearances. Specifically, Section 14 of the 2009 Award provides:

Effective January 1, 2010, officers who do not receive notice at least 48 hours in advance of the time they are directed to appear for a required court appearance, other than a preliminary hearing, scheduled for a date the officer is not scheduled to work, shall be paid a minimum of 4 hours of overtime at a rate of 2.5 times the employee's regular rate.

2009 Award, § 14. In addition to this notification and compensation provision, the 2009 Award also allowed that certain officers who had obtained a specified amount of seniority would no longer be required to reside within the City of Philadelphia. 2009 Award, § 6. Finally, the Panel took the step of retaining jurisdiction to resolve any disputes which arose "regarding implementation" of the 2009 Award. 2009 Award, § 22.³

Thereafter, and in light of Section 14 of the 2009 Award, the Philadelphia Police Department ("Department") issued a notification which addressed certain classes of court appearances within the 48–hour window and premium overtime compensation which was contained in the 2009 Award. Specifically, the Department declared that if an officer was properly notified at least 48 hours ahead of time of a court appearance on a scheduled day off, and the case was continued until the next day, the officer would not be entitled to the premium overtime, even if he did not receive additional notification. The Department reasoned that, as the officer had been notified, there was no disruption to his or her personal schedule. In response, the FOP filed grievances pursuant to the grievance arbitration clause of the Agreement, seeking a determination that the Department did not properly comply with Section 14 of the 2009 Award. While those grievances were pending, however, the FOP also sought an immediate hearing before the Panel to resolve issues which arose from the City's implementation of the 2009 Award's court notice provisions, pursuant to the retainer of jurisdiction provision. 2009 Award, § 22.

In response, the City submitted a proposal, 11 days before the hearing, seeking, inter alia, that the City be permitted to provide officers notice of court appearances electronically through a telephone number or email. As background, evidently as far back as 1999, when the Department received notice from the Philadelphia District Attorney's Office, or a subpoena from private counsel, that a police officer was needed to appear in court, notification to the officer was provided in person, through the officer's platoon commander, who was required to ensure that the officer received and signed the notice. In rare instances, officers were notified by messenger or telephone, if time or circumstances did not permit notification by the platoon commander. If the officer did not comply with the notice, he or she could have been subjected to discipline. The Department's proposed notification procedures changed this system, and included a process by which notification was deemed to be sufficient if a message was left on an officer's voicemail, and, further, such notice was considered to be sufficient for all court appearances, not just those to be completed within 48 hours.

The FOP responded that the Panel did not have the jurisdiction or authority to grant the City's request, as the proposal implicated the manner of notice, which was not the subject of Section 14, and, further, that implementation of Section 14 was the only issue then before the Panel. The City asserted that, by returning to the Panel (in interest arbitration) concerning the implementation of Section 14, the FOP brought the manner of notification within the Panel's jurisdiction and authority. Moreover, the City claimed that the manner of notification was linked to the issue of payment of the premium overtime for late notification, as well as the relaxed residency requirements in Section 6. More specifically, with respect to the second point, the City maintained that, in light of the relaxed residency requirement for officers, electronic notification was required to ensure that greater than 48 hours notice was given to officers so that their lives would not be disrupted and so that the City would not have to pay premium overtime for tardy notice.

On October 6, 2011, the Panel, in a divided 2–1 decision (the "2011 Award"), found in favor of the City, determining in Section 4 of the 2011 Award that: (1) the Department could provide electronic notice of a court appearance using an officer's email address or telephone number, thus requiring all officers to provide the Department with an email address or telephone number; (2) any officer who chose telephone notice was required to have an answering machine or voicemail service; (3) the sending of an email or leaving a message would constitute sufficient notice of an officer's required court appearance; and (4) any officer who did not comply with the electronic notification policy would be ineligible for premium overtime and subject to discipline. 2011 Award, § 4. The Panel majority recognized that the notice issue was not before the Panel during the 2009 interest arbitration, but, nevertheless, believed it was "part-and-parcel" of Section 14's implementation. The FOP-appointed arbitrator filed a vigorous dissent, asserting that the majority had changed what he believed to be a grievance arbitration proceeding into an interest arbitration proceeding, and, thereby altered the terms of the 2009 Award without proper authority. The FOP appealed the Panel's 2011 Award.

On December 27, 2012, the Philadelphia County Court of Common Pleas upheld the arbitration award. The court, after determining that the matter was an appeal of an interest arbitration award, and not the appeal of a grievance award, opined that the Panel did not exceed its powers in issuing Paragraph 4 of the 2011 Award, as, in its view, the issue of manner of notification was properly before the Panel. More pointedly, the court determined that the Panel did what the FOP requested the Panel to do—resolve issues surrounding the implementation of Section 14 of the 2009 Award, a matter for which the Panel specifically retained jurisdiction. Like the Panel, the trial court concluded that the manner of notification and payment of premium overtime were linked, and, as the Panel was not limited to addressing whether the premium overtime pay provided for in Section 14 could be given, it possessed the authority to include Paragraph 4 in the 2011 Award in crafting the appropriate relief. The FOP filed an appeal to the Commonwealth Court.

An en banc Commonwealth Court, in a sharply divided 4–3 published opinion, affirmed.

Michael G. Lutz Lodge No. 5 v. City of Philadelphia, 84 A.3d 343 (Pa.Cmwlth.2014). Writing for the majority, Judge Anne Covey, made threshold determinations that the proceeding was in the nature of an interest arbitration rather than a grievance arbitration, and that the authority of the Panel was at issue, not the jurisdiction of that tribunal.⁴ As to the question of the Panel's authority to speak to the manner of notification, the majority noted that the FOP never disputed that the entirety of Section 14 was at issue during the hearings regarding implementation and that the manner of notification issue was merely an extension of the payment issue. Moreover, the majority pointed out that the 2011 Award regarding how notices are delivered relates directly to how the court notification provision...