Court Opinion

ID: 9699297
Source: CourtListenerOpinion
Date Created: 2023-08-25 20:18:25.048904+00
Date Added: 2024-06-11T18:20:48.523296
License: Public Domain

DAVID T. PROSSER, J.
¶ 39. {dissenting). The majority opinion reverses a unanimous court of appeals decision that vacated the arbitration award in this case. The majority concludes "that the arbitrator's construction of the [collective bargaining] agreement had a foundation in reason" and was therefore not a perverse misconstruction of the agreement. Majority op. ¶¶ 2, 38. I recognize and have no disagreement with the majority's explanation of the well-settled legal rules, principles, and standards that govern the judiciary's supervisory role in reviewing arbitration decisions. See id., ¶¶ 20-23. However, I cannot join the majority opinion because the arbitrator's decision on the timeliness of the formal grievance presented on June 26, 2006, in relation to when the grievant first knew "the facts upon which the grievance was based" effectively amended the plain terms of the grievance procedure set forth in the agreement and therefore was a perverse misconstruction of the agreement. See Nicolet High Sch. Dist. v. Nicolet Educ. Ass'n, 118 Wis. 2d 707, 713-14, 348 N.W.2d 175 (1984) (stating that the arbitrator may not amend the agreement "to dispense his *710own brand of justice" because his power is derived from and therefore limited by the terms of the agreement); City of Milwaukee v. Milwaukee Police Ass'n, 97 Wis. 2d 15, 26-27, 292 N.W.2d 841 (1980) ("If the arbitrator in effect undertook to amend the contract... the award will be vacated... . [H]e is without authority to disregard or modify plain and unambiguous provisions.") (citations omitted); see also City of Oshkosh v. Oshkosh Pub. Library Clerical & Maint. Employees Union Local 796-A, 99 Wis. 2d 95, 106-07, 299 Wis. 2d 210 (1980) ("[W]hen a court declines to enforce an award on the basis of perverse misconstruction, the court may be viewed as protecting the bargain of the parties and insuring the integrity of the arbitration process.").
¶ 40. Consequently, the court of appeals' decision to vacate the arbitration award should be affirmed.
I
¶ 41. In this case, the grievant's contractual rights were violated by the school district beginning in October 2002 when it placed her in the wrong pay category, referred to as a "pay lane." The grievant purportedly did not "realize" this error until August 2005, even though her paycheck actually decreased in October 2002 and she signed separate "Teacher Contraeos]" for each of the three school years at issue that clearly misstated her pay lane.1 See majority op. ¶¶ 9-10. In August 2005, she submitted a "Request to *711Change Lanes for the 2005-06 School Year" form. (Emphasis added.) This form, as its title states, is used for teachers requesting that their pay lane be modified for the upcoming school year. It says nothing about adjusting the teacher's compensation for previous years. The form was not designed for that purpose. In fact, the form was designed to facilitate a provision in the agreement that requires teachers to submit evidence of their "increased professional preparation," i.e., graduate school education credits, so that their pay lane adjustment can be approved in September for that school year. Therefore, while the grievant knew in August 2005 that she had been paid incorrectly for the past three school years, she did not request back pay for those years when she submitted her request to change pay lanes.
¶ 42. The grievant claims that in May 2006, she realized for the first time that her "Request to Change Lanes for the 2005-06 School Year" was granted for the 2005-06 school year but that she had not been made whole for the underpayment of her salary in the previous school years. Nonetheless, she did not file a formal grievance or contact her immediate supervisor as the grievance procedure in the agreement demands. Instead, she and a union representative met with the school district's superintendent who forwarded the matter to the school hoard. The .grievant's informal request for back pay was then denied by the school *712board some time in "late June" 2006. Thereafter, on June 26, 2006, for the first time, the grievant filed a formal grievance.
¶ 43. On July 17, 2006, the school district denied the formal grievance for several reasons, one being that it was untimely because it was submitted more than 15 days after the grievant first knew of the facts upon which her formal grievance for back pay was based. According to the grievance procedure set forth in the agreement, an initial formal grievance must "be presented in writing by the teacher or employee representative to the immediate supervisor within fifteen (15) days after the facts upon which the grievance is based first occur or first become known." (Emphasis added.) A second formal grievance was submitted in late July 2006, and it was also denied by the school board. Ultimately, in accordance with the agreement, the parties agreed to submit the dispute to arbitration.
¶ 44. In his arbitration award, the arbitrator found that the formal grievance submitted on June 26, 2006, was timely and that the school district had violated the grievant's rights under the agreement by incorrectly placing her in the wrong pay lane for three school years (2002-03, 2003-04, and 2004-05). In terms of timeliness, the arbitrator determined that the grievant was challenging the school board's decision to deny her informal back pay request in "late June" 2006. The arbitrator reasoned that because the grievant filed her formal grievance less than 15 days after the school board's decision, the formal grievance was not untimely. This construction of the agreement's grievance procedure is, I believe, perverse and should not be upheld by this court, despite the judiciary's limited role in reviewing arbitration awards.
*713II
¶ 45. In this case, we are reviewing the arbitrator's determination that "the fact[] upon which the [formal] grievance is based" is the school board's June 2006 decision denying the grievant's informal request for back pay. For the arbitrator's award to have any foundation in reason, the same June 26 formal grievance for back pay could not have been submitted prior to the school hoard's decision.2 If the same formal grievance could have been submitted prior to the school board's decision, then the school board's denial of the grievant's informal request for back pay cannot be "the fact[] upon which the [formal] grievance [wa]s based." Because the same formal grievance could have been submitted prior to the school board's decision, "the facts upon which the [formal] grievance is based" must have "first become known" to the grievant before the school board's decision in "late June" 2006. Several reasons support this conclusion.
¶ 46. The most elementary reason is the fact that the grievant's informal request for back pay in May 2006, which the superintendant forwarded to the school board, is substantively the same request the grievant made in her formal grievance. In both instances, the grievant requested that she be made whole for the school years she was compensated according to the incorrect pay lane. Logically, it would have been impossible for the grievant not to have known of the facts upon which the formal grievance for back pay was based when she made her informal request in May 2006. Otherwise, she would have made no informal *714request for back pay. Therefore, the grievant must have "first known" of the underlying "facts upon which the [formal] grievance [was] based," at the very latest, in May 2006, which is more than 15 days before the formal grievance was filed on June 26.3 See Baldwin-Woodville Area Sch. Dist. v. W. Cent. Educ. Ass'n, No. 2008AP519, ¶ 15, unpublished slip op. (Ct. App. Oct. 21, 2008) ("Based on the arbitrator's findings, the latest possible point at which this fact became known was when [the grievant] realized in May[] 2006 that the [school district] was not making her whole for the salary she would have earned[.]") (internal quotations omitted).
*715¶ 47. Additionally, the agreement requires that a formal, written grievance set forth the specific grievance and the facts upon which it is based. In this case, the formal grievance submitted on June 26, 2006, makes two allegations against the school district. The first allegation reads as follows:
By its actions, it is my contention that the [school district] violated Schedules A and B of the 2003-2005 Collective Bargaining Agreement and Article IX - Section A of the 2005-2007 Collective Bargaining Agreement by placing [the grievant] in a pay category of the salary schedule lower than the one she had been placed in when hired by the [school district],
(Emphasis added.) The formal grievance also states that reducing the grievant "a lane for no disciplinary reason. .. was a breach of both the terms of her acceptance of employment. . . and the Collective Bargaining Agreement." Therefore, it is clear that the formal grievance alleged that the school district's placement of the grievant in the wrong pay lane beginning in 2003 was the breach of the agreement,4 As a result, it would be impossible to declare, as the arbitrator does, that the "fact[] upon which the [formal] grievance is based" was the school board's decision to deny the grievant's informal request for back pay in June 2006, because the school board's denial occurred years after the events alleged in the formal grievance.5
*716¶ 48. The second alleged violation presented in the June 26 formal grievance states the following:
By its actions, it is my contention that the [school district] violated Article VI - Grievance Procedure when the [superintendent relinquished his obligation to settle the matter informally by either correcting the error or declining to correct the error and allowing the grievant to pursue the matter to the next level. By unilaterally taking the matter to the [s]chool [b]oard, the administration usurped the grievant's right to petition the [s]chool [b]oard on the matter and expect an impartial review!6]
(Emphasis added.) By its very terms, this allegation recognizes the existence of a grievance in May 2006 when the grievant brought her complaint informally to the superintendant. Otherwise, the grievant could not have alleged a violation of the "Grievance Procedure" that prohibited her from "pursu[ing] the matter to the next level [of the Grievance Procedure]." (Emphasis added.) Therefore, because the formal grievance submitted on June 26, 2006, expressly recognizes the existence *717of a grievance in May 2006, there is no foundation in reason for the arbitrator to have stated that the "facts upon which the [formal] grievance is based" were not known by the grievant until "late June" 2006.
¶ 49. Finally, both the majority opinion and the arbitration award expressly recognize that the grievant "realized" in May 2006 that she had not been awarded back pay for the three school years she was paid according to the incorrect pay lane. See majority op. ¶ 11. Because she "realized" at that time the school district had not made her whole, she knew the facts upon which her formal grievance for back pay was based at that time as well. It is a complete fallacy to say that the grievant "realized" she was not receiving back pay for the period at issue in May 2006, but that the factual basis for her formal grievance regarding that back pay was not first known until the school board denied her informal request for the back pay. In other words, it is a perverse misconstruction of the agreement to say the grievant "realized" the basis for her formal grievance for back pay in May, but "the facts upon which the [formal] grievance" for back pay "first bec[a]me known" occurred in "late June."
¶ 50. Given the circumstances, there is no doubt the arbitrator acted in an equitable manner so that the grievant could be justly compensated. I do not dispute that the grievant was wronged. However, because the arbitrator derives his power from the agreement itself, he cannot ignore, modify, or amend the plain language of the agreement. Nicolet, 118 Wis. 2d at 713-14; Milwaukee Police Ass'n, 97 Wis. 2d at 25-27.7 The arbitrator's *718award yields the same outcome as if the 15-day time limit to file the first formal grievance had been disregarded completely, nullifying the requirement for timely grievances. Thus, this is a perverse misconstruction of a collective bargaining agreement "freely negotiated between two parties with equal bargaining power." Majority op. ¶ 25.
¶ 51. By allowing an arbitrator to determine that the facts upon which a grievance is based do not become known to the grievant until an identical informal complaint made by the same grievant is denied, this court is opening the door to the arbitration of stale claims. Under the arbitrator's and the majority's reasoning, a grievant is effectively permitted to file an informal complaint, wait for the resolution, and if the grievant finds the resolution unfavorable, she can file a formal grievance and try again for the same relief. This is an unreasonable interpretation and a perverse misconstruction of the agreement.
¶ 52. For the reasons stated, I respectfully dissent.

 The grievant signed two contracts for the 2002-03 school year. The first, which was signed on August 15, 2002, stated the correct pay lane at the top of the contract in bold lettering, and it was underlined. A new collective bargaining agreement was then approved, and the grievant was required to sign a new contract for the 2002-03 school year. She did so on October 17, 2002. However, at the top of this contract, underlined and in *711bold lettering, the grievant's pay lane was misstated and her base salary was $660 less than the stated salary on her previous 2002-03 contract. On April 22, 2004, the grievant signed her 2003-04 contract; and on May 20, 2004, the grievant signed her 2004-05 contract. The 2003-04 and 2004-05 contracts both misstated the grievant's pay lane in the same manner.

 The agreement states that "a grievance is any complaint regarding the interpretation or application of a specific provision of1 the agreement.

 Even if we assume the grievant did not know of the facts giving rise to her formal grievance for back pay until the last day in May 2006, the grievant would have been required to file her formal grievance, at the latest, by June 21, 2006 (the agreement instructs that weekends and holidays are not included in computing time limits).
The majority notes the school district "never asserted that the fact triggering the [formal] grievance occurred in May 2006, the date selected by the dissent as the latest date on which the facts underlying the [formal] grievance became known." Majority op., ¶ 32 n.7. This statement is not pertinent to the issue in this case — whether the arbitrator's interpretation is a perverse misconstruction of the agreement. See id., ¶¶ 21-23. As the majority states, "In reviewing this award, we do not determine which construction — the arbitrator's or the [school district's — is more reasonable." Id., ¶ 22. The school district is not asking that we make a determination of when the grievant first knew of the facts upon which her formal grievance for back pay was based. Rather, it is asking that we determine whether the arbitrator's award was arrived at by a perverse misconstruction of the underlying agreement. The purpose of focusing on May 2006 is to show that there is no plausible interpretation of the facts that would permit the arbitrator to conclude the grievant first knew of the facts underlying her formal grievance for back pay any later than May 2006.

 Notably, the grievant was placed in the wrong pay lane beginning in October 2002, but the formal grievance makes no reference to 2002. See supra, ¶ 3; majority op., ¶ 9. The arbitrator, however, disregarded the grievant's omission of that fact and awarded her back pay for the entire 2002-03 school year. Majority op., ¶¶ 5, 18.

 The majority asserts that this dissent makes an argument on the merits of the grievance and accuses it of "concluding *716that... the fact underlying the grievance was that [the grievant] had been placed at the wrong pay lane." Majority op., ¶ 35 n.8. The majority, however, fails to appreciate that this is what the grievant alleged in her formal grievance. The grievant could not have made more clear the facts upon which her formal grievance was based:
[lit is my contention that the [school district] violated Schedules A and B of the 2003-2005 Collective Bargaining Agreement and Article IX - Section A of the 2005-2007 Collective Bargaining Agreement by placing [the grievant] in a pay category of the salary schedule lower than the one she had been placed in when hired by the [school district].

 This alleged violation was not submitted for arbitration, but the arbitrator had a copy of the formal grievance when he determined the award.

 The majority accuses the court of appeals of "paying lip service to the deferential standard of review afforded to arbitration awards." Majority op., ¶ 37. The majority, however, "pay[s] *718lip service" to the standard of review set forth in Nicolet High School District v. Nicolet Education Association, 118 Wis. 2d 707, 713-14, 348 N.W.2d 175 (1984) and City of Milwaukee v. Milwaukee Police Association, 97 Wis. 2d 15, 26-27, 292 N.W.2d 841 (1980), which state that the arbitrator is not free to modify or amend the terms of the agreement he is construing. Despite reciting this standard, the majority fails to apply it to this case, where the arbitrator has substantially modified the requirements of the grievance procedure set forth in the agreement he construed.