Leechburg Area School District v. Leechburg Education Ass'n

OPINION

MANDERINO, Justice.

The issue in this appeal is whether the Commonwealth Court erred in reversing an arbitrator’s award in a dispute submitted to binding arbitration pursuant to a collective bargaining agreement.

The appellant, Leechburg Education Association (Association) is the exclusive bargaining agent for the professional employees of the Leechburg Area School District, and was duly selected under the provisions of the Public Employe Relations Act of 1970 (PERA), Act of July 23, 1970, P.L. 563 No. 195, art. I, § 101 et seq., 43 P.S. §§ 1101.101-1101.2301 (Supp.1977-1978). The appellee, Leechburg Area School District (District) is a public employer in the Commonwealth of Pennsylvania.

The facts are not in dispute. Clara Battist and Margaret Smith were hired as teachers by the District for the 1974 — 75 school year. They agreed to accept the salaries which were offered by the District.

A grievance was later filed by the Association contending that the District violated the collective bargaining agreement in effect between the District and the Association in that the two teachers hired were not being paid the salary to which they were entitled. The dispute was submitted to binding arbitration according to the collective bargaining agreement in effect between the parties.

The arbitrator ruled in favor of the Association. An appeal was then taken to the Commonwealth Court by the District. The Commonwealth Court reversed the arbitrator’s award. Leechburg Area School District v. Leechburg Education Association, 24 Pa.Cmwlth. 256, 355 A.2d 608 (1976). The Association’s petition for allowance of appeal was granted by this Court, and this appeal followed. We vacate the order of the Commonwealth Court and affirm the arbitrator’s award.

The scope of the court’s review of a binding arbitration award under PERA is limited by the Act of April 25, 1927, P.L. 381 No. 248. Community College of Beaver v. Community College of Beaver County, Society of the Faculty (PSEA/NEA), 473 Pa. 576, 375 A.2d 1267 (1977).

Section 10 of the Act of 1927 outlines four situations in which a court may vacate an arbitration award. Section 11 of the Act of 1927 outlines four other situations in which a court may modify or correct an award. If a party seeks to vacate an award, it must allege one of the four conditions contained in section 10. If a party seeks to modify or correct an arbitration award, it must allege one of the conditions specified in section 11.

The appellee District in this case sought to vacate the arbitrator’s award. It was therefore bound to seek judicial review under one of the four categories specified in section 10 of the Act.

The four situations covered in section 10 are:

“(a) Where the award was procured by corruption, fraud, or undue means.

(b) Where there was evident partiality or corruption on the part of the arbitrators, or any of them.

(c) Where the arbitrators were guilty of misconduct in refusing to postpone the hearing upon sufficient cause shown, or in refusing to hear evidence pertinent and material to the controversy, or any other misbehavior by which the rights of any party have been prejudiced.

(d) Where the arbitrators exceeded their powers or so imperfectly executed them that a final and definite award upon the subject matter submitted was not made.”

The first issue raised by the District before the Commonwealth Court was a claim that the arbitrator had not properly interpreted the collective bargaining agreement between the parties. That contention is not one cognizable under section 10 as a basis for vacating an arbitrator’s award.

The first category requires a claim that the award “was procured by corruption, fraud, or undue means.” Appellee has never raised any such issue. The second category permits judicial review to determine whether there was “evident partiality or corruption on the part of the arbitrators.” Appellee never raised that issue. The third category permits judicial review if it is claimed that there was “misconduct” in certain respects or “misbehavior” prejudicing rights. Appellee never raised that issue. The fourth category allows judicial review if the arbitrators “exceeded their powers or so imperfectly executed them that a final and definite award . . . was not made.” It is only this fourth category under which appellee’s claims could conceivably fall.

Appellee, however, does not claim that the arbitrator “exceeded his powers.” If we allowed a claim of improper interpretation of an agreement to fall under the category of “exceeded powers,” binding arbitration would be a useless procedure. The determination of whether an arbitrator “exceeded proper powers” depends upon whether the arbitrator decided a dispute over which he had no jurisdiction, or granted an award which is prohibited by law.

The claim that a court should interpret an agreement differently than did the arbitrator would convert binding arbitration into “unbinding” arbitration. If binding arbitration has any meaning, the arbitrator must be considered the court of last resort except in the very limited categories specified in the Act of 1927. Where an arbitrator has jurisdiction, and where the arbitrator’s award is not contrary to any legislative enactment, and where the arbitrator is not attacked as being corrupt, partial, or having engaged in misconduct or misbehavior, the award must stand.

For these reasons, we have not considered the provisions of the collective bargaining agreement before us. We have no jurisdiction to determine the question of whether the arbitrator mistakenly interpreted the agreement.

Appellee raises other issues which are properly reviewable under the Act of 1927. Appellee contends that the arbitrator’s award is illegal because it is in direct conflict with Section 706 of PERA, 43 P.S. § 1101.706. Section 706 states:

“Nothing contained in this act shall impair the employer’s right to hire employes or to discharge employes for just cause consistent with existing legislation.”

Appellee appears to be arguing that this statute gives the District the exclusive right to “hire employees” on whatever salary terms the District and the individual employee agree to. Section 706, however, must be read in the context of other sections of PERA. PERA provides for the recognition of exclusive collective bargaining representatives. In this case, the Association is the exclusive bargaining agent for the teachers in the Leechburg Area School District. Accepting appellee’s argument would destroy the authority of the Association as exclusive bargaining representative. Were appellee’s view to prevail, a school district could effectively emasculate any salary scales contained in collective bargaining agreements by entering into individual agreements with each teacher. This is exactly the evil intended to be eliminated by the recognition of exclusive bargaining agents, agents who act for all employees the moment they are hired. As the United States Supreme Court recognized over thirty years ago, to allow individual contracts to interfere with the functioning of the collective bargaining agreement would reduce laws providing for collective bargaining to a futility. J. I. Case Co. v. NLRB, 321 U.S. 332, 337, 64 S.Ct. 576, 580, 88 L.Ed. 762, 767-68 (1944).

Appellee also points to section 1142 of the Public School Code of 1949, Act of May 10, 1949, P.L. 30, as amended, 24 P.S. § 1 — 101, et seq. Section 1142 in relevant part states:

“all school districts . . . shall pay all regular and temporary teachers . . . the minimum salaries and increments for the school year 1968-69 and each school year thereafter, as provided in the following tabulation in accordance with the column in which the professional employe is grouped and the step which the professional employe has attained by years of experience within the school district . . . When a school district, by agreement, places a professional employe on a step in the salary scale, each step thereafter shall constitute one year of service. . . . ” (Emphasis added.)

According to the appellee, section 1142 authorizes a school district to agree with an individual teacher as to a salary-scale and ignore the collective bargaining agreement. We reject such an interpretation. If the word “agreement” in section 1142 was interpreted to an agreement with an individual teacher rather than the collective bargaining agreement, section 1142 would completely emasculate PERA’s recognition of exclusive bargaining representatives.

A collective bargaining agreement would eventually become ineffective if a district could, over a period of years, hire new teachers, without adhering to the wage salary scale in the collective bargaining agreement. After a period of time, the same evils would be present which brought about the need for PERA. Employees in a given district could all be paid wage levels totally unrelated to their background, qualifications, or experience, but related only to the particular personal or financial pressures of the employee or the employer at the time of hiring.

As in this case, the two teachers desiring employment were willing to accept a lower wage rather than lose the employment. After such teachers become a part of the system, the discrepancies in salary between them and others similarly situated over a period of time is a cause for unrest.

We have examined section 10 of the Arbitration Act of 1927, and not section 11, because the appellee is asking that an arbitrator’s award be vacated. We note, however, that the issue raised by the appellee would not be cognizable under section 11 either. The first part of section 11 requires some miscalculation. None has been alleged in this case. The second part of section 11 deals with the situation where the arbitrators have decided a matter not submitted to them. No such claim is made in this case. The third part of section 11 deals with the claim that the award is imperfect in form. No such claim has been made in this case. The fourth part of section 11 involves a claim that “the award is against the law.” As indicated earlier, however, we are unable to conclude that the arbitrator’s award in this case was prohibited by any legislative enactment.

Accordingly, the order of the Commonwealth Court is vacated and the award of the arbitrator is affirmed

POMEROY and ROBERTS, JJ., filed concurring opinions. EAGEN, C. J., concurred in the result. JONES, former C. J., did not participate in the decision of this case. NIX, J., did not participate in the consideration or decision of this case.