American Federation of State, County, & Municipal Employees, District Council 20, Local 2087 v. University of the District of Columbia ( 2017 )

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DISTRICT OF COLUMBIA COURT OF APPEALS
No. 13-CV-1024
AMERICAN FEDERATION OF STATE, COUNTY, AND MUNICIPAL EMPLOYEES, DISTRICT
COUNCIL 20, LOCAL 2087, AFL-CIO, APPELLANT,
v.
UNIVERSITY OF THE DISTRICT OF COLUMBIA, APPELLEE.
Appeal from the Superior Court
of the District of Columbia
(CAP-8393-12)
(Hon. Anthony C. Epstein, Trial Judge)
(Argued February 14, 2017 Decided August 17, 2017)
Brenda C. Zwack, with whom Lisa M. Manson was on the brief, for
appellant.
Anessa Abrams, with whom Gary L. Lieber was on the brief, for appellee.
Before BLACKBURNE-RIGSBY, Chief Judge,* and WASHINGTON+ and FERREN,
Senior Judges.
*
Chief Judge Blackburne-Rigsby was an Associate Judge at the time of oral
argument. Her status changed to Chief Judge on March 18, 2017.
+
Senior Judge Washington was the Chief Judge at the time of oral
argument. His status changed to Senior Judge effective March 20, 2017.
2
BLACKBURNE-RIGSBY, Chief Judge: The critical dispute before the court is
whether the arbitrator in this case exceeded his authority or contravened public
policy by awarding attorney‟s fees, where the parties‟ Collective Bargaining
Agreement (“CBA”) is silent on the issue of attorney‟s fees. Appellant American
Federation of State, County, and Municipal Employees, District Council 20, Local
2087, AFL-CIO (“AFSCME”) seeks review of an order of the Superior Court
vacating and remanding a decision by the District of Columbia Public Employee
Relations Board (“PERB” or “Board”) that affirmed an arbitration award of
attorney‟s fees to AFSCME, to be paid by appellee University of the District of
Columbia (“UDC” or “University”).1 The PERB concluded that the arbitrator was
authorized to award attorney‟s fees under the arbitrator‟s inherent equitable
powers. Judge Anthony C. Epstein, however, vacated the award because the
arbitrator did not explicitly indicate whether the arbitration award was based on the
1
The CBA, which was not a part of the PERB‟s certified record, was
attached as an exhibit before the trial court. It contains one provision which merits
some discussion: Article 33.2 (A) of the CBA, pertaining to an employee‟s rights
during a disciplinary action, states that, “Employees shall be entitled to
representation by AFSCME or an attorney provided at the employee‟s own
expense at every level of the disciplinary process.” (emphasis added). This
provision is not in tension with the PERB‟s conclusion that the CBA is silent on
attorney‟s fees. By the article‟s plain meaning, see Abdelrhman v. Ackerman, 76
A.3d 883, 888 (D.C. 2013), an employee subject to disciplinary action has the
option to either procure representation himself/herself at his/her own expense or
the right to representation from the union itself. The CBA does not state that either
the employee or AFSCME is precluded from seeking reimbursement later if the
employee prevails in his or her personnel action.
3
CBA. We conclude that the arbitrator did not exceed his authority by granting
attorney‟s fees under his inherent equitable powers and that the award does not
contravene public policy. Accordingly, we reverse the Superior Court‟s decision
to remand and reinstate the PERB‟s decision affirming the arbitration award. See
D.C. Code § 1-605.02 (6) (2012 Repl.).
I. Factual and Procedural Background
AFSCME filed a grievance against UDC on behalf of two union employees
under the parties‟ CBA, after the employees were terminated by UDC for misuse
of University funds. The parties went to arbitration before Arbitrator Michael
Wolf, who found in favor of AFSCME, in part. He determined that the two union
employees should have been given thirty-day suspensions, instead of being
terminated. In a supplemental award, Mr. Wolf also awarded AFSCME
reimbursement of reasonable attorney‟s fees that it incurred representing the two
employees in the arbitration process. Although the CBA is silent on the issue of
reimbursement of attorney‟s fees, Mr. Wolf concluded that AFSCME was entitled
4
to reimbursement of reasonable attorney‟s fees under the authority of the federal
Back Pay Act (“BPA”). See 5 U.S.C. § 5596 (b)(1)(A)(ii) (2014).2
Although “[t]he Council of the District of Columbia itself has never
promulgated regulations to implement the Back Pay Act, which is a vestige of the
patchwork system in effect prior to the passage of Home Rule in 1973[,]” this
court has held “that the Back Pay Act continues to apply to District employees
under the broader [Comprehensive Merit Personnel Act (“CMPA”)] policies of
maintaining all „concrete personnel entitlements or benefits‟ or their equivalents
for employees hired before the CMPA . . . and maintaining the pre-CMPA
2
The BPA states in relevant parts:
An employee of an agency who, on the basis of a timely
appeal or an administrative determination (including a
decision relating to an unfair labor practice or a
grievance) is found by appropriate authority under . . .
collective bargaining agreement, to have been affected by
an unjustified or unwarranted personnel action which has
resulted in the withdrawal or reduction of all or part of
the pay, allowances, or differentials of the employee . . .
is entitled, on correction of the personnel action, to
receive for the period for which the personnel action was
in effect . . .
reasonable attorney fees related to the personnel action
....
5 U.S.C. § 5596 (b)(1)(A)(ii) (emphasis added).
5
„compensation system‟ for all employees whenever hired until a new one is
enacted to replace it.” Am. Fed’n of Gov’t Emps. v. District of Columbia Water
and Sewer Auth., 942 A.2d 1108, 1112-13 (D.C. 2007) (citations omitted)
(“AFGE”); see also White v. District of Columbia Water and Sewer Auth., 962
A.2d 258, 259 (D.C. 2008) (per curiam). In White, we explained, however, that
government entities statutorily eligible for CMPA exemption,3 such as then-Water
and Sewer Authority (“WASA”),4 that adopt a new, comprehensive personnel and
compensation system for its employees are exempt from “the CMPA-and with it,
the counsel fees provisions [under the BPA] included in its compensation system.”
962 A.2d at 259.5
3
See D.C. Code § 1-602.01 (a) (2012 Repl.).
4
See D.C. Code § 34-2202.02 (2012 Repl.).
5
In a Rule 28 (k) letter filed on December 2, 2016, UDC cites to our recent
decision in Walker v. Office of the Chief Information Technology Officer, 127 A.3d
524 (D.C. 2015), to support its argument that the District‟s implementation of the
District Personnel Manual (“DPM”) on February 4, 2005, had completely
superseded the application of the BPA. As UDC concedes in its brief, however,
neither PERB nor this court has yet ruled whether the DPM supersedes the
application of the BPA. In fact, in two cases following the DPM‟s
implementation, AFGE (2007) and White (2008), this court has maintained that the
BPA shall continue to apply to District entities that fall under the broader CMPA.
Walker does not decide the question of whether the DPM supersedes the BPA.
Rather, Walker stands for the proposition that, on the issue of employee mitigation,
the “DPM‟s [mitigation] provision does not abridge but merely explains the
common law mitigation requirement that has long been read into the [BPA].” 127
A.3d at 530 (emphasis added).
6
After conducting a thorough analysis of the CMPA provisions governing
UDC employees, our decision in White, and the BPA, Mr. Wolf concluded that the
BPA‟s provision for the reimbursement of attorney‟s fees could be, and should be,
applied to this case.6 Specifically, he concluded that AFSCME is entitled to
reimbursement of attorney‟s fees from UDC because UDC, as a governmental
entity under the CMPA, had not adopted or implemented a comprehensive
personnel and compensation system for its “Career Service” employees, to which
the two aggrieved employees belonged.7 Mr. Wolf found that “major aspects” of
UDC‟s Career Service employee system were still governed by the CMPA — for
example, he noted that “negotiations with the University‟s Career Service
employees has for many years been undertaken by the Mayor‟s Office of Labor
Relations and Collective Bargaining on behalf of numerous D.C. agencies.” Yet,
while Mr. Wolf provided extensive analysis on why the BPA could be applied to
the facts here, Mr. Wolf did not explain which provision within the parties‟ CBA
authorized him to award reasonable attorney‟s fees to AFSCME. See, e.g.,
Howard Univ. v. Metro. Campus Police Officer’s Union, 519 F. Supp. 2d 27, 32-
33 (D.D.C. 2007) (“The genesis of arbitral authority is the contract, and arbitrators
6
See 5 U.S.C. § 5596 (b)(1)(A)(ii).
7
See D.C. Code § 1-602.01 (CMPA applies to employees of the “University
of the District of Columbia”). See, e.g., D.C. Code § 1-602.03 (“Educational
employees” of UDC are governed by separate provisions).
7
are permitted to decide only those issues that lie within the contractual mandate.”)
(citation and brackets omitted).
Following Mr. Wolf‟s decision, UDC filed an arbitration review request
with PERB, arguing that the arbitrator exceeded his authority by granting the
award, and that the award was also contrary to law and public policy. See D.C.
Code §§ 1-605.01 to -605.04 (2012 Repl.) (establishing and identifying the powers
of the Public Employee Relations Board). In its Decision and Order, the PERB
affirmed the arbitration award. The PERB concluded that the award was not
contrary to law and public policy based on Mr. Wolf‟s analysis and application of
the White decision to UDC‟s Career Service employees. The PERB further
concluded that Mr. Wolf did not exceed his authority by looking to the BPA and
granting AFSCME attorney‟s fees under the BPA because PERB “has long held
that an arbitrator does not exceed his authority by exercising his equitable power,
unless it is expressly restricted by the parties‟ collective bargaining agreement.”
See District of Columbia Metro. Police Dep’t v. Fraternal Order of Police/Metro.
Police Dep’t Labor Comm., PERB Case No. 06-A-05, at *4 (Aug. 27, 2012).
UDC then filed a petition for review of PERB‟s decision with Superior
Court. See Super. Ct. Civ. Agency Rev. R. 1 (g) (stating that the Superior Court
8
“shall base its decision . . . upon the administrative record and shall not set aside
the action of the agency if supported by substantial evidence in the record as a
whole and not clearly erroneous as a matter of law”); see also Nunnally v. District
of Columbia Metro. Police Dep’t, 80 A.3d 1004, 1006-07 (D.C. 2013) (holding
that certain agency decisions should first be reviewed by the Superior Court).
Judge Epstein vacated the award and remanded the case to the PERB, concluding
that the arbitrator failed to explain his authority for granting attorney‟s fees. Judge
Epstein determined that the arbitrator granted attorney‟s fees based on his
interpretation of the BPA, but that the BPA was never explicitly mentioned in the
parties‟ CBA, and that the arbitrator “did not purport to construe or apply the CBA
when he decided to award attorney[‟s] fees under the [BPA].” Thus, in the judge‟s
view, “[b]ecause the record [provided] no basis for PERB or the [c]ourt to
conclude that the [a]rbitrator‟s award of attorney[‟s] fees was arguably based on an
interpretation of the CBA, the [a]rbitrator exceeded his authority.”8 AFSCME now
8
Judge Epstein concluded that there were two possible avenues by which
the arbitrator‟s award for attorney‟s fees could be sustained. First, he noted that
the arbitrator could clarify that he had the authority under an amorphous provision
within the CBA that authorized an arbitrator to make “improperly disciplined
employees whole with respect to pay, benefits, seniority and all other employment
rights.” Second, he also agreed with the PERB that the arbitrator could grant
attorney‟s fees under his equitable powers given that nothing in the CBA expressly
restricted the arbitrator‟s authority in this regard. However, because the arbitrator
did not explain his rationale and basis for awarding attorney‟s fees, Judge Epstein
concluded that “the appropriate course of action is to remand the case to PERB,
(continued…)
9
appeals Judge Epstein‟s decision to remand the arbitration award and asks this
court to reinstate the PERB‟s decision.9
II. Discussion
It is important to note that “[a]lthough this is an appeal from a review of
agency action by the Superior Court rather than a direct appeal to this court, we
review the PERB decision as if the matter had been heard initially in this court.”
Gibson v. District of Columbia Pub. Emp. Relations Bd., 785 A.2d 1238, 1241
(D.C. 2001). Accordingly, while we respect the trial court‟s decision, we are not
(…continued)
and PERB can decide whether it is appropriate (or even possible at this stage) to
direct the [a]rbitrator to address whether the CBA implicitly authorizes an award of
attorney[„s] fees.”
Judge Epstein also expressly rejected UDC‟s substantive arguments for
setting aside the award of attorney‟s fees, concluding that, “If the [c]ourt had
concluded that the Arbitrator arguably interpreted the CBA to authorize an award
of attorney fees under the CMPA or the Back Pay Act, the [c]ourt would defer to
the Arbitrator‟s ruling that the Back Pay Act applies to UDC, and it would uphold
PERB‟s decision.”
9
On November 18, 2014, the division sua sponte directed AFSCME to
show cause why this appeal should not be dismissed as having been taken from a
non-final order given that the trial court had remanded the case back to the PERB.
See Warner v. District of Columbia Dep’t of Emp’t Servs., 587 A.2d 1091, 1093
(D.C. 1991). AFSCME filed a timely response to the court‟s order to show cause
and this court discharged the show cause order on February 4, 2016.
10
required to accord legal deference to its ruling. Moreover, our review of the PERB
is limited; we “must sustain the Board‟s decision if it is supported by substantial
evidence in the record as a whole and not clearly erroneous as a matter of law.” Id.
(citations and internal quotation marks omitted). Accordingly, “[u]nless „rationally
indefensible,‟ a PERB decision must stand.” Fraternal Order of Police/Dep’t of
Corrections Labor Comm. v. District of Columbia Pub. Emp. Relations Bd., 973
A.2d 174, 176 (D.C. 2009).
Further, PERB‟s review of an appeal of an arbitration award is, likewise,
limited. District of Columbia Pub. Emp. Relations Bd. v. Fraternal Order of
Police/Metro. Police Dep’t Labor Comm., 987 A.2d 1205, 1208 (D.C. 2010).
PERB may only modify, set aside, or remand an arbitrator‟s decision “if the
arbitrator [1] was without, or exceeded, his or her jurisdiction; [2] the award on its
face is contrary to law and public policy; or [3] [the award] was procured by fraud,
collusion, or other similar and unlawful means . . . .” D.C. Code § 1-605.02 (6).
To resolve the issue of whether the arbitrator‟s decision to grant AFSCME
attorneys‟ fees under the BPA exceeded his authority or was contrary to law and
public policy, we first examine UDC‟s argument that the arbitration award of
reasonable attorney‟s fees to AFSCME based on the BPA was “contrary to law and
11
public policy.” UDC claims that, contrary to Mr. Wolf‟s and the PERB‟s
decisions, UDC had established its own comprehensive personnel and
compensation system based on the criteria we set forth in White. UDC further
claims that the DPM had superseded the BPA. Essentially, UDC seeks to re-
litigate the question of whether the CMPA or the BPA — or neither — applies to
UDC‟s Career Services employees. This is something UDC cannot do at this stage
of appellate review. “[W]hen parties have agreed to submit disputes to arbitration,
they have bargained for the arbitrator‟s construction of the contract . . . not some
other tribunal‟s.” District of Columbia Pub. Emp. Relations Bd., supra, 987 A.2d
at 1208 (citations and internal quotation marks omitted). Accordingly, whether an
arbitration award has contravened law and public policy requires that the “public
policy alleged to be contravened . . . be well defined and dominant, and is to be
ascertained by reference to the laws and legal precedents and not from general
considerations of supposed public interest.” Id. at 1208 (emphasis added)
(citations and internal quotation marks omitted). Consequently, “[a]bsent a clear
violation of law — one evident on the face of the arbitrator‟s award, the PERB
lacks authority to substitute its judgment for the arbitrator‟s” even if the PERB (or
this court) may disagree with the arbitrator‟s interpretation. Fraternal Order of
Police/ Dep’t of Corrections Labor Comm., supra, 973 A.2d at 177 (emphasis
added) (citations and internal quotation marks omitted).
12
Here, as the PERB concluded, UDC has not provided any clear case law
from this court or statutes that unequivocally supports the conclusion that UDC
Career Services employees are not governed by the CMPA and the BPA. Absent
direct legal authority prohibiting Mr. Wolf‟s interpretation of the applicability of
the BPA in this case, his decision in this matter cannot be considered contrary to
law. There is also no law or policy that prohibits an arbitrator from awarding
attorney‟s fees to the employee‟s union. “Whether or not a union may solicit
attorneys‟ fees as a matter of independent entitlement, the victorious employee
surely can, and the representative character of the union and its lawyers in the
litigation for which fees are sought must be taken fully into account.” Am. Fed’n
of Gov. Emps., AFL-CIO, Local 3882 v. Fed. Labor Relations Auth., 944 F.2d 922,
929 (D.C. Cir. 1991).
Here, Mr. Wolf applied our decision in White to the facts presented, and we
see nothing inherently incorrect with his analysis. For example, Mr. Wolf
determined that UDC Career Service employees were not a part of a separate,
comprehensive personnel and compensation system because they were
“represented in negotiations by the Mayor‟s Office of Labor Relations and
Collective Bargaining, which acts on behalf of multiple D.C. agencies with
employees in the same Compensation Unit of the Career Service.” This fact,
13
among others, distinguishes this case from White, where WASA was statutorily
permitted to seek CMPA exemption and for the most part had adopted its own
comprehensive regulations governing employee compensation. 962 A.2d at 259.
Consequently, we defer to the PERB‟s decision that the arbitration award did not
violate law or public policy. Fraternal Order of Police/ Dep’t of Corrections
Labor Comm., supra, 973 A.2d at 177-78.
We also reject UDC‟s argument that Mr. Wolf exceeded his authority by
looking to the BPA when the CBA was silent on the issue of attorney‟s fees. 10 It is
true that “an arbitrator is confined to interpretation and application of the collective
bargaining agreement [and] [his or her] award is legitimate only so long as it draws
its essence from the collective bargaining agreement.” Sindler v. Batleman, 416
A.2d 238, 242 (D.C. 1980) (quoting United Steelworkers of Am. v. Enter. Wheel &
Car Corp., 363 U.S. 593, 597 (1960)). However, “an arbitrator does not exceed
10
UDC takes issue with the PERB‟s determination that the CBA is silent on
the issue of attorney‟s fees. UDC claims that because Article 33.2 (g), which is not
a part of the record, states that improperly disciplined employees are to be made
“whole with respect to pay, benefits, seniority, and all other employment rights,”
by negative [implication] attorneys‟ fees are to be excluded because attorneys‟ fees
are not an “employment right.” We reject this argument for the same reason that
the trial court rejected this argument. See District of Columbia v. Hunt, 520 A.2d
300, 304 (D.C. 1987) (“[W]e conclude that the attorney‟s fees . . . [are] not an
administrative process or mechanism but [are] instead a concrete personnel
entitlement . . . .”) (emphasis added).
14
his [or her] authority by exercising his [or her] equitable power, unless it is
expressly restricted by the parties‟ collective bargaining agreement.” District of
Columbia Metro. Police Dep’t, supra, PERB Case No. 06-A-05, at *4 (emphasis
added); see also Fraternal Order of Police/Dep’t of Corrections Labor Comm.,
supra, 973 A.2d at 177 (acknowledging the PERB‟s recognition that an arbitrator
has equitable powers unless restricted by the collective bargaining agreement).
The parties‟ CBA in this case is silent on the issue of attorney‟s fees and no public
policy prevents an arbitrator from awarding attorney‟s fees, when the CBA is
silent. Further, Article 34.6 of the parties‟ CBA states, “The arbitrator‟s award
shall be final and binding, provided that it does not contradict applicable statute.”
Accordingly, we defer to the PERB‟s conclusion that Mr. Wolf‟s arbitration award
did not exceed the scope of his authority, as it was derived from his equitable
powers.11
11
UDC argues that the CBA provision which states that an employee found
to be improperly disciplined shall be made whole with respect to “pay, benefits,
seniority and all other employment rights” does not include attorney‟s fees paid for
by the Union on behalf of its members because its members are not obliged to
repay the Union‟s incurred costs. But nothing within this provision “expressly
restricts” Mr. Wolf‟s authority to grant attorney‟s fees to the Union; further, as Mr.
Wolf concluded, the Union may recover attorney‟s fees incurred by its members.
See United States Dep’t of Defense Defense Fin. and Accounting Serv. v. Am. Fed.
of Gov. Emp. Local 2510, 60 F.L.R.A. 281, 284 (2004) (“As the Authority has
repeatedly recognized, attorney fees are incurred when an attorney-client
relationship exists and counsel has rendered legal services on behalf of the
(continued…)
15
In our view, a remand is not warranted. While Mr. Wolf did not explain
whether his decision to award AFSCME reasonable attorney‟s fees was based on
the CBA or his equitable powers, the trial court identified two possible bases for
affirming the arbitration award. See supra note 8. Typically, “[a]rbitrators . . . are
not required to state the grounds for their decisions.” Schwartz v. Chow, 867 A.2d
230, 233 (D.C. 2005); see also Cathedral Ave. Co op., Inc. v. Carter, 947 A.2d
1143, 1153 (D.C. 2008) (“[A]rbitrators commonly do not offer reasons for [a]
decision . . . .”).
More importantly, we think that whether an arbitrator has exceeded his or
her authority pursuant to the parties‟ CBA is a question of law that, by statute, is
for the PERB, and thereafter this court, to decide. See D.C. Code § 1-605.02 (6)
(stating that the PERB may modify, set aside, or remand an arbitration award “only
if the arbitrator was without, or exceeded, his or her jurisdiction . . . .”); Motor City
Drive, LLC v. Brennan Beer Gorman Monk Architects and Interiors, PLLC, 890
A.2d 233, 236 (D.C. 2006) (“One of the statutory grounds for vacating an
arbitration award is the arbitrator exceeded his powers. Whether an issue is
arbitrable is a question of law, and a court must make its own determination on the
(…continued)
employee. . . . Moreover, an attorney-client relationship exists when an attorney
represents an employee on behalf of a union.”) (citation omitted).
16
issue. The standard of review of arbitrability, in other words, is de novo.”)
(citations, internal quotation marks, and brackets omitted). In fact, it is
“undeniably a legal issue for judicial determination.” Howard Univ., supra, 519 F.
Supp. 2d at 33 (citations and internal quotation marks omitted). The PERB
concluded in this case that Mr. Wolf, as a matter of law, did not exceed his
authority to grant attorney‟s fees based on his equitable powers as arbitrator. We
cannot conclude that the PERB‟s conclusion that Mr. Wolf was authorized by his
equitable powers to grant attorney‟s fees where the CBA appears silent on the issue
is “clearly erroneous as a matter of law.” Gibson, supra, 785 A.2d at 1241.
III. Conclusion
Based on the foregoing reasons, we reverse the Superior Court‟s order and
reinstate the PERB‟s decision to uphold the arbitration award of reasonable
attorney‟s fees to AFSCME.12
12
Because we affirm the PERB‟s decision directly, the issue of whether
certain exhibits outside of the certified administrative record should not have been
considered by the trial court is moot. We also need not decide, as AFSCME
contends, whether UDC waived the question of whether the arbitrator was
authorized to grant attorney‟s fees by failing to seek a stay of arbitration. See, e.g.,
Howard Univ., supra, 519 F. Supp. 2d at 35 (party to arbitration waives the “right
to seek judicial relief of the arbitrator‟s award, having participated in the
(continued…)
17
So ordered.
(…continued)
arbitration process and then failing to object and preserve its objection to the
arbitrability of the grievance submitted to the arbitrator”).