TEAMSTERS LOCAL UNION NO. 469 VS. STAFFORD TOWNSHIP (C-000177-15, OCEAN COUNTY AND STATEWIDE) ( 2018 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court."
Although it is posted on the internet, this opinion is binding only on the
parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-4344-15T4
TEAMSTERS LOCAL UNION
NO. 469, AN UNINCORPORATED
LABOR ORGANIZATION AND
ROBERT YAK,
Plaintiffs-Respondents,
v.
STAFFORD TOWNSHIP AND MAYOR,
TOWNSHIP ADMINISTRATOR AND
ELECTED OFFICIALS OF SAID
TOWNSHIP,
Defendants-Appellants.
_______________________________
Argued April 30, 2018 - Decided August 1, 2018
Before Judges Accurso, O'Connor and Vernoia.
On appeal from Superior Court of New Jersey,
Chancery Division, Ocean County, Docket No.
C-000177-15.
Jerry J. Dasti argued the cause for
appellants (Dasti, Murphy, McGuckin, Ulaky,
Koutsouris & Connors, attorneys; Jerry J.
Dasti, of counsel and on the brief; Martin
J. Buckley, on the brief).
Timothy R. Hott argued the cause for
respondents.
PER CURIAM
Defendant Stafford Township appeals from a final order
confirming a hearing officer's decision to recommend
reinstatement and a sixty-day suspension of Township employee
Robert Yak pursuant to a grievance filed by Yak's union,
plaintiff Teamsters Local Union No. 469, following his
termination by the Township. We reverse. The hearing officer's
decision was only a recommendation, which the Township could
elect to accept or reject in accordance with the authority it
reserved to itself in the parties' collective negotiations
agreement. The hearing officer's decision was not an
arbitration award subject to confirmation by the court under the
Arbitration Act, N.J.S.A. 2A:24-1 to -11.
Although there is obviously a "back story" we are not privy
to,1 the essential facts necessary to resolve this appeal are
undisputed. The Township suspended and then fired Yak, its
Network Administrator, an eighteen-year employee with an
1
We refer to a related unfair practice charge the Union filed
alleging the Township discriminated against Yak, a member of the
Union's negotiating committee, "for his support of and
membership in a labor organization." It was that charge and the
Union's allegation the Township Administrator pursued a
"personal vendetta" against Yak that, among other things,
necessitated the Administrator's recusal and the appointment of
an independent hearing officer whose decision gave rise to this
appeal.
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unblemished record, for conduct unbecoming a public employee.
Specifically, the Township alleged Yak accessed and read
confidential email of other Township personnel he was not
authorized to read.
Following Yak's suspension, the Union filed a grievance on
Yak's behalf in accordance with Article XXXI of the parties'
collective negotiations agreement. We quote the provision in
full:
ARTICLE XXXI
GRIEVANCE PROCEDURE
A. The purpose of this Article is to provide
for a peaceful and equitable means of
resolving differences between the parties.
B. A grievance shall be defined as any
claim, breach, misinterpretation, or
misapplication of any express provision of
this Agreement. Disciplinary action with
just cause may be the subject of a grievance
under this Agreement.
C. The following procedure shall be used to
resolve grievances as an exclusive method.
All time frames shall be strictly complied
with. Failure to comply with said time
frame shall constitute a waiver by either
party.
Procedure
The grievant shall submit a written
grievance giving rise to the issue. The
grievance shall be submitted within five
days of the discipline issued to the
Township Administrator. The Township
Administrator shall notify the grievant of a
3 A-4344-15T4
hearing date within 15 working days after
submission of the grievance. The hearing
shall take place approximately 15 working
days after the submission of the grievance,
and a written answer shall be provided to
the grievant within 10 working days after
the hearing. Representatives of the union
shall be present during any hearing
including the shop steward of record and any
witnesses needed. After receiving the
answer of the administrator the grievant
shall have fifteen days from that point to
either except [sic] his response or move it
to the arbitration level for a final
determination. The arbitrator shall be
assigned by PERC [Public Employment
Relations Commission] and his decision shall
be final and binding on all parties. The
cost of arbitrator shall be shared equally
by both parties.
[Emphasis is ours.]
When negotiations between the lawyers for the Township and
the Union to permit Yak to resign in good standing broke down,
after the Township Council refused to accept the terms the
lawyers had negotiated, the Union reactivated its grievance.
Counsel for the Union closed his letter to the Township's lawyer
confirming that fact with the following offer:
Finally, so that no more time be pointlessly
wasted, I propose that you and I, on behalf
of our respective clients, agree to forego
the rest of the grievance procedure and move
to the final step by submitting the matter
to the New Jersey Public Employment
Commission for appointment of an arbitrator
to hear and decide the issue in final and
binding arbitration as called for in the
collectively negotiated agreement. I look
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forward to your prompt reply to this
proposal.
The Township refused that offer, insisting the grievance proceed
in the normal course to an internal hearing before the matter
could be moved "to the arbitration level for a final
determination."
Because of the Union's pending unfair practice charge
against the Township Administrator, and that he would likely be
called as a witness against Yak, the Administrator could not
preside over the hearing contemplated by the grievance
procedure. Accordingly, the Township, by resolution of the
Township Council, appointed Bonnie Peterson, a licensed New
Jersey attorney, to serve as the "hearing officer for the
Township of Stafford . . . with regard to the pending employment
related grievance filed by an employee of the Township."
Nothing in the resolution, however, suggested the Township
had reversed position on refusing to submit the matter to
binding arbitration or that it was ceding any of the "Management
Rights" it "retain[ed] and reserve[d] unto itself" in Article
III of the parties' collective negotiations agreement, including
"[d]isciplinary action included but not limited to suspension,
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demotion, discharge, or . . . other appropriate disciplinary
action against any employee for good and just cause."2
2
Article III provides as follows:
ARTICLE III
MANAGEMENT RIGHTS
A. Management Rights
The Employer hereby retains and reserves
unto itself, without limitations, all
powers, rights, authority, duties and
responsibilities conferred and vested in it
prior to the signing of this Agreement by
the laws and Constitutions of the State of
New Jersey and of the United States;
including, but without limiting the
generality of the foregoing, the following
rights:
1. All management functions and
responsibilities which the Employer has not
expressly modified or restricted by a
specific provision of this Agreement.
2. The right to establish and
administer policies and procedures related
to personnel matters, Employer control
activities, training, operational functions,
performance of services and maintenance of
the facilities and equipment of the
Employer.
3. Disciplinary action included but
not limited to suspension, demotion,
discharge, or takes other appropriate
disciplinary action against any employee for
good and just cause.
(continued)
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(continued)
4. To hire, promote, transfer,
assign, schedule, reassign, lay-off, and
recall employees to work.
5. To determine the number of
employees and the duties to be performed.
6. To maintain the efficiency of
employees; to establish, expand, reduce,
alter, combine, consolidate, or abolish any
job or job classification, department or
operation or service.
7. To determine staffing patterns and
areas worked, to control and regulate the
use of facilities, supplies, equipment,
materials and any other property of the
Employer.
8. To determine the number, location
and operation of divisions, departments,
work selections, and all other work units of
the Employer, the assignment of work, the
qualifications required the performance
standards and the size and composition of
the work force.
9. To subcontract for any existing or
future services as determined necessary by
the Employer.
10. To make or change Employer rules,
regulations, policies, and practices
consistent with the specific terms and
provisions of this Agreement.
11. And otherwise to generally manage
the affairs of the employer, attain and
maintain full operating efficiency and
productivity and to direct the work force.
(continued)
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Following three days of hearings involving the testimony of
three fact witnesses, including both the Township Administrator
and Yak, one forensic computer expert and the admission of
nineteen exhibits, Peterson issued a fifty-seven page "decision
as hearing officer, concerning [the] disciplinary charges filed
by Stafford . . . against employee, Mr. Robert Yak." Peterson
explained her role as "the hearing officer [was] to make
findings of fact and credibility to determine whether the
employer has established the disciplinary charges against Mr.
Yak by a fair preponderance of credible evidence." Finding the
Township proved Yak improperly accessed email but did not
establish he read them or passed them to others, it was her
"recommendation, that Mr. Robert Yak receive a sixty (60) day
suspension, without pay, from his employment."
Nowhere in Peterson's detailed and comprehensive opinion
does she suggest she was rendering a final decision binding the
(continued)
The exercise of the foregoing powers,
rights, authority, duties and
responsibilities of the Employer shall be
limited only to the specific and expressed
terms of this Agreement and then only to the
extent such specific and express terms
hereof are in conformance with the
Constitution and laws of the State of New
Jersey and rules and regulations.
8 A-4344-15T4
parties.3 To the contrary, Peterson noted the Township's
rejection of Yak's proposal "to bypass the hearing officer stage
of the disciplinary proceedings, and to proceed directly to
PERC"; referred to the Township's election "in order to preserve
impartiality, . . . and independence in the hearing process
. . . to appoint [her] as an independent hearing officer, as an
individual professional, rather than an in-house, Stafford
Township official"; underscored Yak's entitlement to have the
charges against him "explored fully in the hearing process,
prior to any final determination, and most importantly, prior to
any formal final disciplinary action to be taken"; referred to
her decision as "the undersigned hearing officer's recommended
disciplinary action"; and "[p]arenthetically" observed that "the
parties [might] wish still to engage in discussions, as to
amicable means to resolve all issues and to give both sides
closure."
A week after Peterson issued her decision, before the
Township had taken any action in response, counsel for Yak wrote
to the lawyer for the Township advising him "that the Union and
Mr. Yak hereby give notice of their respective acceptance of the
3
We, of course, are not reviewing the hearing officer's
decision and have no ability to do so as neither the transcripts
of the hearing nor the exhibits entered in evidence are
available to us.
9 A-4344-15T4
decision rendered by [the] hearing officer" and demanded Yak's
immediate reinstatement. A few weeks later, counsel for the
Township wrote to the Union's lawyer to advise that the Township
Council at a recent meeting had reaffirmed its prior decision to
terminate Yak and, thus, his "termination remains in full force
and effect." The Union's lawyer replied, asserting that "the
Township designated Attorney Peterson as the hearing officer to
conduct the hearing in place of the Township Administrator. She
issued her decision. Once Mr. Yak accepted her 'recommendation'
the Township had no further rights under the Grievance
Procedure."
The Union and Yak thereafter filed a verified complaint and
proposed order to show cause "to confirm a decision arising from
a collectively negotiated agreement in accordance with N.J.S.A.
2A:24-1, et seq." Specifically, plaintiffs sought "the court's
equitable power and authority to enforce the decision and
recommendation of the Hearing Officer." On the return of the
order to show cause, the Township argued there was no
jurisdiction in the court to enforce the recommendation of a
hearing officer, relying on Padovano v. Borough of East Newark,
329 N.J. Super. 204, 219 (App. Div. 2000).
The trial court entered judgment for plaintiffs, finding
the decision of the hearing officer "is final and binding in
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favor of Plaintiffs" and ordered the Township to reinstate Yak
in accordance with the hearing officer's decision. The court
found:
In contrast to Padovano, the [collective
negotiations agreement] in this case
reflects that the decision of the Hearing
Officer with regard to "whether a municipal
employee should be retained or dismissed"
was intended to bind the parties if accepted
by the Union. The language of the
[collective negotiations agreement] does not
reserve to the Township any right for
further action after the grievant accepts
the Hearing Officer's decision. The
[collective negotiations agreement] provides
in relevant part: "[a]fter receiving the
answer of the administrator the grievant
shall have fifteen days from that point to
either except [sic] his response or move it
to the arbitration level for a final
determination." The express terms of the
[collective negotiations agreement] reserves
only to the grievant the right to either
accept the decision or move it to binding
arbitration. The Township unilaterally
appoints the Hearing Officer, and plaintiffs
may not object without just cause the
appointment. This procedure — to utilize a
hearing officer — is clearly for the purpose
of containing costs in disputed labor
matters.
The Court finds that the [collective
negotiations agreement] "clearly and
unmistakably established" that the Township
waived its right to pursue further action
once the Hearing Officer makes a
determination and the Union accepts the
disposition or penalty of the Hearing
Officer. The Court finds that the Township
intended to vest the Hearing Officer with
the power to determine the public employment
11 A-4344-15T4
dispute and to thereby divest the parties
from binding arbitration once the Union
accepted the recommendations of the Hearing
Officer as to discipline. The Hearing
Officer's determination is binding on the
Township pursuant to "Article XXXI Grievance
Procedure" of the [collective negotiations
agreement].
The Township appeals, contending the hearing officer's
recommendation was not a final decision binding the parties, and
that the Union's appeal from the Township's decision rejecting
the hearing officer's recommendation was to PERC for the
appointment of an arbitrator. We agree.
The decision before us for review is whether the trial
court was correct that the hearing officer's decision was one
subject to confirmation pursuant to N.J.S.A. 2A:24-7, which
permits "[a] party to the arbitration" within three months of
the award to "commence a summary action . . . for the
confirmation of the award or for its vacation, modification or
correction."4 Not even the Union, however, asserts that the
4
The question being one of law, our review is de novo. See
Jones v. Morey's Pier, Inc., 230 N.J. 142, 153 (2017); Manalapan
Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378
(1995). Accordingly, we reject the Union's assertion that our
role is limited to determining whether the hearing officer's
interpretation of the contract was reasonably debatable. That
is the standard courts apply to review of an arbitrator's
interpretation of a collective negotiations agreement. N.J.
Transit Bus Operations, Inc. v. Amalgamated Transit Union, 187
N.J. 546, 553 (2006). It has no application here.
12 A-4344-15T4
proceeding before the hearing officer was an arbitration. Its
claimed basis for jurisdiction in the trial court to confirm the
decision of the hearing officer, which it concedes was not an
arbitration award, was that the Arbitration Act applies "to an
arbitration or dispute arising from . . . a collectively
negotiated agreement." [Emphasis is the Union's.]
Although it is certainly true that N.J.S.A. 2A:24-3 permits
a court to compel an uncooperative party to arbitrate a
"dispute" "in the manner provided for in the [parties']
agreement," see Barcon Assocs., Inc. v. Tri-County Asphalt
Corp., 86 N.J. 179, 187 (1981), the Union has not provided us
any authority suggesting a court, acting under the Arbitration
Act, could affirm, vacate or modify a decision not the product
of an arbitration, and our own research has not uncovered such
authority. Surely there would have been no role for the court
in confirming the decision had the Township Administrator not
recused himself. The decision would have remained an internal
one, which the Union, if unwilling to accept, could have
"move[d] . . . to the arbitration level for a final
determination" by an arbitrator assigned by PERC.
Had Yak and the Union instead accepted the Administrator's
decision, there would likewise have been no jurisdiction in the
Superior Court to confirm the Administrator's decision under the
13 A-4344-15T4
Arbitration Act. We see no reason to conclude the Township's
appointment of an external hearing officer to conduct the
internal hearing afforded Yak under the collective negotiations
agreement, based solely on a conflict preventing the designated
Township official from presiding, changed the character of this
pre-arbitration stage of the grievance procedure. The decision
rendered by the hearing officer remained the product of an
internal hearing conducted by the Township in accordance with
the grievance procedure negotiated by the parties, not subject
to confirmation under the Arbitration Act.
There is another reason the hearing officer's decision was
not one that could be confirmed as an arbitration award under
the Act; it was not a final decision, by an arbitrator or anyone
else. It was only a recommendation by the hearing officer to
the Township. Again, focusing on the question of what would
have been different had the Township Administrator presided over
the hearing is useful. Here, it illuminates the meaning of the
words the parties chose to govern the "procedure [to] be used to
resolve grievances as an exclusive method" in their collective
negotiations agreement.
The trial court focused, appropriately enough, on the
language of the grievance procedure explaining the process after
the grievant is in receipt of "the answer of the administrator"
14 A-4344-15T4
following the hearing. That provision provides the grievant
fifteen days "to either except [sic] his response or move it to
the arbitration level for a final determination." But the
court, at the urging of the Union, analyzed the language using a
phrase, "hearing officer," not included in the text.
Substituting "hearing officer" for "Township Administrator"
in Article XXXI, the court concluded the collective negotiations
agreement "'clearly and unmistakably established' that the
Township waived its right to pursue further action once the
Hearing Officer makes a determination and the Union accepts the
disposition or penalty of the Hearing Officer," and that "the
language . . . does not reserve to the Township any right for
further action after the grievant accepts the Hearing Officer's
decision." The court's focus on the role of "the hearing
officer" in this particular case obscured what we think is the
obvious plain meaning of the text of Article XXXI.
The grievance procedure does not "reserve to the Township
any right of further action" following the grievant's receipt of
"the answer of the administrator," because it is the answer of
the Administrator, that is, the Township. The Township
obviously has no right of appeal from its own decision. It has
not "waived" anything. If the grievant accepts the decision of
the Township to impose discipline, that is the end of it. If
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not, he has fifteen days to "move it to the arbitration level
for a final determination."
But an independent hearing officer, unlike the
Administrator, is not the Township. The Township had to act to
accept or reject the hearing officer's recommendation, thereby
rendering a decision on the grievance, before there was any
right in the grievant to accept the Township's decision or move
it to the level of binding arbitration. The Union's attempt to
accept the hearing officer's recommendation as if it were the
Township's decision, short-circuited the grievance process and,
if allowed to stand, would convert what was to be an internal
hearing into the equivalent of binding arbitration.
That a hearing officer had to be appointed in place of the
Administrator to preside over the hearing because of an unfair
practice charge the Union had pending against him did not alter
the character of this internal hearing. It simply required the
Township to act on the recommended decision of the hearing
officer in order for the grievant to "receive the answer of the
[Township] administrator" on the grievance filed by Yak and the
Union, which they could then accept or move to the level of
binding arbitration.
The trial court, again focusing on a phrase not included in
the text of Article XXXI, found "that the Township intended to
16 A-4344-15T4
vest the Hearing Officer with the power to determine the public
employment dispute and to thereby divest the parties from
binding arbitration once the Union accepted the recommendations
of the Hearing Officer as to discipline." But ceding the
Township's management right of discipline of employees,
expressly reserved in Article III, to a person not employed by
the Township or elected by its citizens, and thereby "divesting"
both parties of their bargained for right of "binding
arbitration" to resolve their "public employment dispute" would
be extraordinary and there is no support for it, either in the
language of the collective negotiations agreement or in the
record.
We considered whether a hearing officer's recommended
discipline of a police officer was binding on his municipal
employer in Padovano. There the municipality served
disciplinary charges on a twenty-year member of the police force
and appointed a hearing officer to hear the charges. 329 N.J.
Super. at 208. The hearing officer sustained three of the
charges, including conduct unbecoming. Ibid. Although
initially recommending Padovano's termination, the hearing
officer granted Padovano's motion for reconsideration and
amended his recommendation to a 120-day suspension in light of
Padovano's unblemished record. Ibid. The Borough disregarded
17 A-4344-15T4
the hearing officer's amended recommendation and dismissed
Padovano from the police force. Id. at 208-09. The question on
appeal, as pertinent here, was whether the municipality was
required to follow the hearing officer's recommendation. Id. at
218.
We held "the status of the hearing officer, who was
independent of either party, requires a conclusion that his
determinations about an appropriate penalty were no more than
recommendations, which the Borough could elect to adopt or
disregard in its sound discretion." Id. at 219. We reasoned
that "[a]dopting Padovano's argument" that the municipality was
bound by the hearing officer's recommendation, "would require a
conclusion that the Borough intended to vest in an independent
party the decision whether a municipal employee should be
retained or dismissed." Ibid. We found "nothing to indicate
that the Borough intended to vest the hearing officer with such
sweeping powers or that it was authorized by statute to do so."
Ibid.The trial court declined to follow Padovano based on its
view that the collective negotiations agreement "reflects that
the decision of the Hearing Officer with regard to 'whether a
municipal employee should be retained or dismissed' was intended
to bind the parties if accepted by the Union." As we have
18 A-4344-15T4
already explained, the Agreement does not express such an
intent. To the contrary, the Agreement reflects that the
decision to retain or dismiss a municipal employee is the
Township's, which the employee may either accept or move to
binding arbitration. We find the reasoning of Padovano
unassailable and follow it here.5
The undisputed evidence in the record likewise supports the
conclusion the Township did not cede the decision to suspend or
terminate Yak to the hearing officer. The Township expressly
rejected the Union's suggestion that the parties bypass the
internal Township hearing called for in the grievance procedure
in favor of simply submitting the matter to binding arbitration
in the first instance before an arbitrator appointed by PERC.
The resolution appointing the hearing officer does not state the
Township was submitting the parties' dispute to the hearing
officer for resolution. Instead, it states only that "the
filing of a grievance requires the Township to appoint a hearing
officer to carefully consider all of the evidence." It
certainly did not state the Township was transferring to the
5
The Union argues Padovano turned on the plaintiff's status as
a police officer. The Padovano court's use of the term
"municipal employee" rather than "police officer" in the
sentence we quoted suggests the opinion was not so limited. See
329 N.J. Super. at 219.
19 A-4344-15T4
hearing officer the power it reserved to itself in Article III
to take "appropriate disciplinary action against any employee
for good and just cause."
Further, Peterson's decision makes clear she understood her
charge as limited to hearing the evidence, determining whether
the Township had carried its burden and, if so, making a
recommendation as to discipline, in other words, to act as a
hearing officer. The many references in her opinion we quoted
make clear beyond doubt that she did not believe she was either
acting as an arbitrator or had been asked to assume the role of
Yak's employer.
In sum, because the hearing officer's decision was not an
arbitration award subject to confirmation by the court under the
Arbitration Act, and, indeed, was only a recommendation, which
the Township could elect to accept or reject in its discretion,
we reverse the judgment in favor of plaintiffs and remand for
entry of an order dismissing their complaint.
Reversed.
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