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THE SUPREME COURT OF NEW HAMPSHIRE

___________________________

Cheshire

No. 2021-0061

KEENE SCHOOL DISTRICT

v.

KEENE EDUCATION ASSOCIATION, NEA-NH

Argued: November 16, 2021

Opinion Issued: February 8, 2022

Soule, Leslie, Kidder, Sayward & Loughman, PLLC, of Salem (Peter C. 

Phillips on the brief and orally), for the plaintiff.

Esther Kane Dickinson, of Concord, staff attorney, NEA-New Hampshire, 

by brief and orally, for the defendant.

MACDONALD, C.J. The plaintiff, Keene School District (School District), 

appeals the decision of the Superior Court (Ruoff, J.) denying the School 

District’s petition to modify, correct or vacate an arbitrator’s award. See RSA 

542:8 (2021). The arbitration arose from grievances lodged by two teachers 

claiming that the School District’s 120-day delay in paying early retirement 

benefits violated the collective bargaining agreement (CBA) between the School 

District and the defendant, Keene Education Association (Association). The 

arbitrator concluded that the School District’s delay violated the CBA. We 

affirm.
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I. Factual and Procedural Background

 The arbitrator found the following facts. The CBA originally covered the 

period from July 1, 2014, through June 30, 2018. The parties extended it to 

include the period during which the grievances were filed. The following 

sections of the CBA Articles 14 and 11 are at issue in this dispute.

Section 14.1 provides in relevant part:

Any full-time member of the Keene Teacher’s Bargaining Unit 

who is at least fifty-five (55) years of age and who has at least 

twenty (20) years of full-time service . . . as a teacher in the Keene 

School District may apply for early retirement . . . . Said 

application to retire early shall be made no later than December 

first (1st) prior to the intended July first (1st) retirement date . . . .

Section 14.3 provides in relevant part:

Said early full retirement participants shall receive from said date an 

annual stipend in accordance with the following schedule:

YEARS OF SERVICE

EARLY RETIREMENT STIPEND 

AS A PERCENTAGE OF THE 

AVERAGE OF THE PRECEDING 

5 YEARS ANNUAL SALARY

35 39%

. .

. .

. .

20 31.5%

Section 14.4 provides:

Any employee who participates in this early retirement plan 

shall not be entitled to any benefits whatsoever except the stipend 

set forth herein. Nor shall the annual salary computation include 

the value of such fringe benefits. Meaning and intending that the 

early retirement participant shall not be entitled to medical/dental 

insurance, life insurance or other benefits provided to members of 

the bargaining unit; nor shall the stipend percentage be applied to 

the value of such benefits.
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Section 14.6 provides:

Stipends provided to employees under this plan shall 

automatically terminate upon the occurrence of any of the 

following:

a. Normal retirement age as determined by the Social Security 

Administration;

b. Death of an employee; in such event, the benefits of this plan 

shall not vest in the employee’s estate;

c. After the employee has received seven (7) full years of the 

early retirement benefit. 

Finally, Section 11.3 provides in relevant part that “[a] grievance must be 

filed within forty-five (45) consecutive days of the time the grievant knew or 

should have known of the facts giving rise to the grievance.” 

An early retirement benefit for School District teachers has existed since 

at least 2005. Until 2011, teachers who availed themselves of this benefit

retired on July 1 and received their first payment at the end of August or early 

September of the same year. During this period, the School District did not 

consider early retirement benefits as “earnable compensation” and, therefore, 

did not contribute the employer’s required 17% contribution to the New 

Hampshire Retirement System (NHRS) or deduct 7% of the employee’s payment 

to remit to NHRS.

In 2011, the legislature redefined “earnable compensation.” Laws 2011, 

224:161 (codified at RSA 100-A:1, XVII (Supp. 2021)). The new definition 

provided that cash incentives to encourage members to retire early were to be 

included as earnable compensation for those vested prior to January 1, 2012. 

Id. Because the School District had not treated early retirement stipends this 

way, it had not budgeted to do so. The statute also provided that, for all 

members, no matter when vested, payments made 120 days after termination 

from employment would not be included as earnable compensation. Id.

The two teachers at issue are Randall Burns and R. Scott Hyde. After 28 

years of teaching in the School District, Burns applied for early retirement on 

November 19, 2018, with an effective date of July 1, 2019. After 24 years of 

teaching, Hyde applied for early retirement on October 10, 2018, with an 

effective date of July 1, 2019. The School District approved both applications. 

In letters dated December 12, 2018, the School District’s human resources 

director informed the teachers: “The first year you are retired, the District will 

pay your annual stipend amount in equal, bi-weekly payments starting with 

the first pay period in November 2019 through June 30, 2020. This is so you 

and the Board [of Education] do not incur additional [NHRS] wage deductions 

from your stipend.” 
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Delaying the first early retirement benefit payment until November 

ensured that payments were made 120 days after retirement and did not count 

towards earnable compensation under RSA 100-A:1, XVII. Between 2012 and 

2018, forty-three teachers retired and received their first payment in the first 

payroll period of November. None of those teachers questioned the delay.

Hyde contacted NHRS and was told that its regulations do not require an 

employer to withhold early retirement benefits for 120 days. By letter dated 

March 12, 2019, Hyde conveyed this information to the School District and 

asked why the first early retirement payment was being delayed. Shortly 

thereafter, the School District’s human resources generalist wrote to Hyde 

stating that she had been in contact with NHRS and quoted RSA 100-A:1’s 

provision stating, “Earnable compensation shall not include compensation in 

any form paid later than 120 days after the member’s termination of 

employment from a retirement eligible position . . . .” Id. The letter to Hyde 

again stated: “The [School] District, and you as the retired member do not want 

to incur any earnable compensation penalties.” In its communications to 

Burns and Hyde, the School District did not state that it was avoiding its 

contribution to NHRS and diminishing the retirees’ retirement benefit. 

In late spring of 2019, Hyde and Burns realized that if the School District 

made the first early retirement bi-weekly payment in July 2019 and made the 

required 17% percent employer contribution while deducting the 7% employee 

contribution from payments made within 120 days after termination of their 

employment, their monthly retirement benefit from NHRS would increase by 

more than $100. On April 29, 2019, they filed identical grievances with the 

School District, alleging that withholding the early retirement payments until 

November 2019 violated various CBA sections, including CBA Sections 14.1 

and 14.3. On May 21, 2019, the School District denied the grievances. The 

Association submitted the matter to arbitration.

The parties stipulated to the submission of three issues for resolution: 

first, is the dispute arbitrable due to the timeliness of the grievances; second, if 

the dispute is arbitrable, did the School District violate the CBA by paying the 

grievants their early retirement benefit beginning on November 1, 2019; and, 

third, if so, what shall be the remedy? Following a hearing, on April 14, 2020, 

the arbitrator issued a written award finding that the grievances were 

arbitrable and that the School District violated the CBA by failing to make the 

early retirement payments beginning July 1. The arbitrator concluded that the 

retirement payments include “all sums due for paying the stipend, including 

required contributions to NHRS.” As for a remedy, the arbitrator stated that 

Hyde and Burns “may pursue their statutorily entitled retirement benefits with 

the New Hampshire Retirement System.”

The CBA provides that either party may appeal the arbitrator’s decision 

in accordance with RSA chapter 542. See RSA 542:1 (2021). The School 
5

District petitioned the superior court to modify, correct or vacate the award. 

See RSA 542:8. Following a hearing, the superior court denied the petition. 

This appeal followed.

II. Analysis

Judicial review of an arbitrator’s award is limited. Lebanon Hangar 

Assocs. v. City of Lebanon, 163 N.H. 670, 673 (2012). RSA 542:8 provides that 

a party to the arbitration may apply to the superior court to confirm, correct or 

modify the award for “plain mistake,” or vacate the award “for fraud, 

corruption, or misconduct by the parties or by the arbitrators, or on the ground 

that the arbitrators have exceeded their powers.” RSA 542:8. The question of 

an arbitrator’s authority is a question of contract interpretation, which we 

review de novo. Lebanon Hangar Assocs., 163 N.H. at 673. 

The School District raises several arguments challenging the arbitrator’s 

award. We address each in turn. First, it argues that the arbitrator exceeded 

his powers by concluding that the early retirement stipends should include

contributions to NHRS. Specifically, the School District argues that, although 

it agreed to arbitrate the timing of the stipend payments, it did not agree to 

arbitrate whether such payment is subject to NHRS contributions. 

An arbitrator’s jurisdiction over an issue depends upon the voluntary 

agreement of the parties. Id. His view of the scope of the issue is “entitled to 

the same deference normally accorded to the arbitrator’s interpretation of the 

contract.” Id. “In the absence of clearly restrictive language, great latitude 

must be allowed in the framing of an award and fashioning of an appropriate 

remedy.” Id. (quotation omitted). “[I]t is the arbitrator’s ultimate 

understanding of the scope of his authority that must be accorded deference by 

a reviewing court.” Id. at 677; see Bull HN Information Systems, Inc. v. 

Hutson, 229 F.3d 321, 332 (1st Cir. 2000) (explaining that the arbitrator’s 

interpretation of the scope of the issue submitted is treated with great 

deference and must be upheld if rationally derived from the parties’ 

submissions). 

In reaching the issue of NHRS contributions, the arbitrator acted well 

within the scope of the parties’ submissions. The parties stipulated that the 

arbitrator should resolve whether the School District “violate[d] the [CBA], 

Article 14, by paying the grievants their early retirement benefit beginning on 

November 1, 2019?” The School District’s justification for delaying the stipend 

was that Hyde and Burns would not have to “incur additional [NHRS] wage 

deductions from [their] stipend[s].” In its written submission to the arbitrator, 

the School District argued that Section 14.4 of the CBA prohibited any NHRS 

contribution for early retirement stipend recipients. As the superior court 

noted, the School District cannot now complain that the arbitrator lacked the 

authority to address an argument the School District had raised. We agree.
6

The School District contends, in the alternative, that, even if the issue of 

NHRS contributions was arbitrable, the arbitrator was plainly mistaken in light 

of Section 14.4 of the CBA. A reviewing court may vacate an arbitral award for 

a plain mistake of law under two circumstances. Finn v. Ballentine Partners, 

LLC, 169 N.H. 128, 146 (2016). First, the court may find a plain mistake of law

when there has been a change in the law after the issuance of an award, but 

before the award is reduced to final judgment, if the court concludes that the 

arbitrator would not have reached the same conclusion had the arbitrator

known of the change in law. Id. Second, the court may find a plain mistake of 

law when the arbitrator clearly misapplied the law to the facts. Id. 

The arbitrator was not plainly mistaken in interpreting Section 14.4. He 

concluded, and we agree, that the section prescribes limitations on the 

calculation of the early retirement benefit. In its second sentence, Section 14.4 

states that the “annual salary computation,” meaning Section 14.3’s formula 

for calculating the stipend, shall not “include the value of such fringe benefits.” 

As the third sentence of Section 14.4 provides, the salary used for calculating 

the stipend does not include “medical/dental insurance, life insurance or other 

benefits.” The third sentence limits the payment of such benefits after early 

retirement. The first sentence also limits the payment of such benefits after 

early retirement, providing that the retiree is not “entitled to any benefits 

whatsoever except the stipend.” However, by making clear that early retirees 

may not receive benefits other than the stipend itself, section 14.4 cannot be 

read as restricting NHRS payments required by statute when that very benefit 

is paid. 

The School District next argues that the arbitrator was plainly mistaken 

in failing to consider the past practice of making the first stipend payment 60 

to 120 days after the July 1 retirement date. The arbitrator concluded that the 

School District’s practice was at odds with the plain language of the CBA and 

that there was an absence of mutuality because “[t]here is no evidence that the 

Association knew about the 120 day delay in the School District’s making these 

payments, much less that it agreed with such a practice.” The School District 

does not argue that the language in Section 14.3 is ambiguous or silent in 

establishing July 1 as the date on which early retirement payments 

begin. Instead, it argues that, “[w]hile the arbitrator claims that ‘the agreement 

must be interpreted as written,’ it cannot be read in a vacuum. CBA’s are 

living, working documents intended to govern the parties’ relationship over a 

very long time, and that history should be afforded proper weight and 

consideration.”

Essential to the School District’s argument is that the parties had a 

common understanding of the past conduct. On this point, we find no plain 

mistake in the arbitrator’s conclusion that the Association neither knew of, nor 

agreed to, the delayed stipend payments. The record is uncontroverted that, 

prior to the grievances at issue, no retiring teacher had complained of the 
7

delayed stipend payment and no deductions or contributions were made to 

NHRS. And, even when Hyde and Burns ultimately became the first teachers 

to pursue the issue, the School District did not disclose that, by delaying 

stipend payments, it avoided its NHRS contributions and diminished the 

retirees’ retirement benefits. Under these circumstances, the arbitrator made 

no plain mistake in concluding that the basic elements of mutuality were not 

present. See Elkouri & Elkouri, How Arbitration Works 12-6 to 12-7 (Kenneth 

May et al. eds., 8th ed. 2016) (“‘Mutuality’ refers to the requirement that a past 

practice is binding on the parties only when the circumstances ensure that it 

has been understood and accepted by both as an implied term of the 

contract.”). Without mutuality, a past practice is not enforceable. See Appeal 

of N.H. Dep’t of Corrections, 164 N.H 307, 309 (2012).

Finally, the School District argues that the arbitrator exceeded his 

authority by “directing that [NHRS] should make the grievants . . . finally whole 

as a result of the District’s delay in paying them the early full retirement.” 

(Capitalization omitted.) We do not agree with the School District’s 

interpretation of the arbitrator’s award. It simply states that Hyde and Burns 

“may pursue their statutorily entitled retirement benefits” with NHRS. By its 

plain language, the award does not direct either the grievants or NHRS to do 

anything.

Affirmed.

HICKS, BASSETT, HANTZ MARCONI, and DONOVAN, JJ., concurred.