Vill. of Posen v. Ill. Fraternal Order of Police Labor Council

17 N.E.3d 195

The VILLAGE OF POSEN, Illinois, Plaintiff–Appellant

v.ILLINOIS FRATERNAL ORDER OF POLICE LABOR COUNCIL, Defendant–Appellee.

No. 1–13–3329.

Appellate Court of Illinois, First District, First Division.

Aug. 11, 2014.

Rehearing Denied Sept. 10, 2014.

Thomas F. McGuire, of Thomas F. McGuire & Associates, Ltd., of Long Grove, for appellant.

Jeffery Burke, of Illinois Fraternal Order of Police Labor Council, of Western Springs, for appellee.

OPINION

Presiding Justice CONNORS delivered the judgment of the court, with opinion.

¶ 1 Plaintiff, the Village of Posen (Village), appeals from an order of the circuit court that denied plaintiff's motion to vacate an arbitration award and confirmed the award entered in favor of defendant, the Illinois Fraternal Order of Police Labor Council (Union), which had represented Kevin Hammond in a grievance procedure after Hammond was terminated from the Village police department. On appeal, the Village contends the circuit court improperly struck allegations in its complaint that alleged that Hammond was not covered by the collective bargaining agreement and therefore the arbitrator did not have jurisdiction. The Village also challenges the underlying arbitration award, contending that: (1) the arbitrator improperly required that the Village prove the allegations by clear and convincing evidence, rather than by a preponderance of the evidence; (2) the arbitration award violates public policy; and (3) the arbitrator improperly required the Village to hold a pre-termination hearing. Lastly, the Village contends that if the award is upheld, the matter should be remanded to the arbitrator to determine a setoff. We affirm the judgment of the circuit court and decline to remand for a setoff.

¶ 2 The record reveals that the Union is the exclusive bargaining representative for police officers employed by the Village. Hammond began as a part-time Village police officer in July 2006 and became a full-time officer in May 2008. While returning to his squad car on February 11, 2011, Hammond slipped on some ice, causing him to fracture his knee and injure his arm. As a result of his injuries, Hammond was off work for an extended period and was eventually released to return to work in August 2011.

¶ 3 Pursuant to the Public Employee Disability Act (Act) (5 ILCS 345/1 (West 2010) ), Hammond received 100% of his salary beginning on the date of his injury. Additionally, workers' compensation provided a benefit of two-thirds of an employee's regular income. The dispute between the Union and the Village arose because, for a period of time, Hammond received his salary and workers' compensation checks simultaneously, contrary to the Village's general practice of the Village receiving and retaining the workers' compensation checks from the insurance carrier. The Village eventually learned of Hammond's double payments, and on June 13, 2011, Hammond was terminated because he “accepted and endorsed checks from both the Village of Posen and [the] workers' compensation carrier for the same period of missed work” and failed to return those funds to the Village.¹ The Village maintained that Hammond violated three of the Posen Police Department Rules of Conduct (Rules of Conduct). In part, the Village asserted that Hammond engaged in unbecoming conduct, defined as “any action or occurrence which discredits or brings the Department into disgrace, disrespect[,] or reflects badly upon an individual member(s) of the Department” and “any activity that impairs or disrupts the operation or efficiency of the Department or * * *individual member.” Additionally, Hammond was alleged to have violated a rule concerning immoral conduct, which states that officers “will not participate in any incident or activity that involves questionable or immoral behavior that could impair their ability to perform as a law enforcement officer or causes the Department to be embarrassed, disgraced[,] or discredited.” The Rules of Conduct further provided that a violation of any of the rules “will be sufficient cause for counseling, reprimand, suspension[,] or dismissal” of any member of the police department.

¶ 4 After he was terminated, the Union filed a grievance on Hammond's behalf pursuant to the collective bargaining agreement between the Village and the Union. In part, the agreement provided that “[n]o employee covered by the terms of this Agreement shall be suspended, relieved from duty[,] or disciplined in any manner without just cause.” In a section titled “Management Rights,” the agreement further provided:

“Except as specifically limited by the express provisions of this Agreement, the Village retains all traditional rights to manage and direct the affairs of the Village in all of its various aspects and to manage and direct its employees, including but not limited to the following:* * *discipline, suspend [,] and discharge employees for just cause (probationary employees without cause)* * *.”

¶ 5 Submitting the grievance in writing to the chief of police was the first step in a three-step grievance procedure for resolving disputes between the Village and an employee or the Union “regarding the application, meaning[,] or interpretation of this Agreement.” The second step was to submit the grievance to the mayor. The third step of the procedure was arbitration, which would begin with the Village and Union selecting an arbitrator from a list of seven arbitrators from the Federal Mediation and Conciliation Service. The agreement provided that the decision and award of the arbitrator “shall be final and binding on the parties involved” and that the arbitrator “shall have no power to amend, modify, nullify, ignore, add to[,] or subtract from the provisions of this Agreement.”

¶ 6 The Union's grievance in this matter alleged that the Village terminated Hammond without just cause in violation of the collective bargaining agreement. The grievance further stated that the desired remedy was to “reinstate the grievant to full employment, remove the notice of termination from the [grievant's] file, compensate the grievant for any lost wages and benefits, in part and in whole, make grievant whole.”

¶ 7 Arbitration proceedings were held on February 7 and March 12, 2012. At the start of the proceedings, the arbitrator, counsel for the Union, and counsel for the Village had the following exchange:

“MR. ARBITRATOR: My assumption is that the issue before the Arbitrator is whether there was just cause for the termination of the grievant, Kevin Hammond, and if not, what is the appropriate remedy?

MR. BURKE [Counsel for the Union]: Yeah, we'll stipulate to that issue.

MR. ARBITRATOR: Is that correct?

MR. McGUIRE [Counsel for the Village]: Yes.

MR. ARBITRATOR: All right. * * * [A]m I also correct in believing there are no procedural problems, no question of arbitrability?

MR. BURKE: We don't have any.

MR. McGUIRE: Same.”

¶ 8 Additionally, the Village and the arbitrator disagreed about the amount of evidence needed to find that Hammond was terminated for just cause. While the Village asserted that the correct quantum of proof was preponderance of the evidence, the arbitrator stated that he would require clear and convincing evidence based on the nature of the charges. The arbitrator also stated that “where the accusations are such that they raise questions of moral turpitude, I require more than a mere preponderance.”

¶ 9 In their opening statements, the Village contended that Hammond's actions constituted felony theft, while the Union asserted that the Village had rushed to judgment and lacked just cause to terminate him.

¶ 10 Mary Jo Wisniewski, a secretary for the Village who also handled workers' compensation claims, testified that after Hammond's injury, she initially believed his workers' compensation checks were being sent to the Village. However, around April 2011, she learned the checks were actually being sent to Hammond's home. She subsequently called the Village's workers' compensation insurance carrier, Berkley Risk Administrators Company (Berkley), and informed a claim manager that Hammond's checks should be sent to the Village because Hammond was already being paid 100% of his salary through payroll. Berkley had recently become the Village's workers' compensation insurance carrier. Reflecting about how the checks ended up at Hammond's home, Wisniewski stated “it could have been my fault. I don't know.* * *[T]hey should have been informed when we switched over the insurance that in case of injuries, that we do pay 100[%], and all checks should be coming to us* * *on both ends it was just a misunderstanding or an error.”

¶ 11 On May 12, 2011, Mark Mendenhall, a Berkley claim manager, sent Hammond a letter that advised him that the Village had notified Berkley that it continued paying his salary while Berkley was paying workers' compensation benefits. The letter continued that additional benefits would be mailed to the Village and “[a]ny benefits you have received should be forwarded to the employer directly.” Additionally, the letter stated that “[c]hecks that were mailed to you directly were stopped and resubmitted to your employer.”

¶ 12 Karen Milewski, who was assigned as Hammond's case manager for his workers' compensation claim, testified that she was responsible for coordinating Hammond's treatment and updating the claims adjuster and his employer on his treatment and recovery. Milewski denied that, prior to his termination, Hammond had ever told her that he was receiving an additional check on top of his salary. Milewski further testified that if someone were to inform her of a double payment, she would tell that person to either call an attorney or his claims adjuster as she does not handle that kind of issue and is “not [supposed] to get involved in that.”

¶ 13 Sergeant Robert Quirk of the Village police department testified that he was asked to investigate after the Village learned of the double payments. During Sergeant Quirk's...