Court Opinion

ID: 9658733
Source: CourtListenerOpinion
Date Created: 2023-08-23 21:10:13.814656+00
Date Added: 2024-06-11T18:13:58.380122
License: Public Domain

SHIRLEY S. ABRAHAMSON, CHIEF JUSTICE
¶ 34. (dissenting). This case implicates the relationship between a statute governing terms and conditions of employment and a public sector bargaining agreement, one of the most difficult issues in public sector labor law.1 A rule that gives automatic priority to a statute can render the duty to bargain insignificant while a rule giving automatic priority to an agreement can result in effective repeal of state law.2 This court has thus demanded that "collective bargaining agreements and statutes also governing conditions of employment must be harmonized whenever possible."3
¶ 35. I dissent because the majority opinion fails to harmonize Wis. Stat. §§ 62.13(5)(em) and 111.70 and thus contravenes both. I would affirm the decisions of the circuit court and the Wisconsin Employment Relations Commission that ordered the City to proceed with arbitration on the union's grievance.
¶ 36. In Kraus v. City of Madison, 2003 WI 51, 261 Wis. 2d 485, 662 N.W.2d 294, this court effectively held *444that Wis. Stat. § 62.13(5)(em) does not protect municipal employees who are promoted subject to successful completion of a period of probation when they are denied that promotion during the period of probation for nondisciplinary reasons. In the present case, this court now holds that the same statute bars those same municipal employees from collectively bargaining with a municipality under Wis. Stat. § 111.70 to require that a chiefs or police and fire commission's decision to deny a promotion be reasonable.4
¶ 37. When read together, these two decisions hold that when a police officer or firefighter is promoted contingent upon the successful completion of a period of probation, his promotion may be denied for a completely false, irrational, or unsubstantiated reason before the end of his probationary period, even if:
(1) the actual reason for denying his promotion is disciplinary and is subject to the just cause provisions of Wis. Stat. § 62.13(5)(em); and
*445(2) a collective bargaining agreement negotiated pursuant to Wis. Stat. § 111.70 requires that the denial he reasonable.
¶ 38. I disagree with this interpretation of the statutes. The legislature did not intend § 62.13(5)(em) to be both a sword and a shield for municipalities, allowing them to fend off all requests for just cause hearings and deflect any efforts to negotiate alternative protections for officers promoted subject to a period of probation. Nor did the legislature intend to leave police officers and firefighters helpless in the face of arbitrary and capricious personnel decisions when it enacted § 111.70, codifying the right of municipal employees to collectively bargain over their wages, hours, and conditions of employment.
¶ 39. The majority opinion here narrowly construes the collective bargaining agreement in order to create conflict between the agreement and Wis. Stat. § 62.13, contravening the rule that collective bargaining agreements and statute's must be harmonized whenever possible. The collective bargaining agreement at issue here can, I conclude, be reasonably construed to limit, not replace, the chiefs discretion to return a firefighter to his prior rank during a period of probation, thereby giving effect to both the chiefs power under § 62.13 and the municipality's duty to bargain under § 111.70. Under this interpretation of the statutes and the agreement, the grievance is arbi-trable.
¶ 40. The majority opinion errs in two respects. First, it changes the two-prong test to determine arbi-trability. Second, it erroneously applies the test of arbitrability.
*446I — I
¶ 41. To determine arbitrability in the present case, I, like the majority, must apply the two-prong test set forth in City of Milwaukee v. Milwaukee Police Ass'n, 97 Wis. 2d 15, 292 N.W.2d 841 (1980) ("Milwaukee II"). Milwaukee II states the test as follows: "When the court determines arbitrability, it is limited to considering [1] whether the arbitration clause can be construed to cover the grievance on its face and [2] whether any other provision of the contract specifically excludes it."5 A similar test was set forth in Milwaukee Police Ass'n v. City of Milwaukee, 92 Wis. 2d 145, 285 N.W.2d 119 (1979) ("Milwaukee I"). This two-prong test was set forth by the U.S. Supreme Court in United Steelworkers of America v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582-83 (1960), which this court has frequently quoted with approval.6
¶ 42. The majority opinion correctly and approvingly announces this oft-repeated two-prong test as the one to be applied in the present case to determine arbitrability.7 Yet while pretending to follow this test, the majority opinion restates and changes the test. The majority opinion declares a new two-prong test for determining arbitrability as follows: "[TJhere are two relevant contractual inquiries in the analysis of arbi-trability: 1) does the arbitration clause cover the griev-*447anee on its face; and 2) is there another provision of the collective bargaining agreement that specifically excludes arbitration?"8
¶ 43. Gone from the first prong of the test is the concept of liberal construction embodied in the phrase "whether the arbitration clause can be construed to cover the grievance." The newly stated test requires the arbitration clause to cover the grievance on its face, rather than being capable of a construction that covers the grievance. The majority opinion reveals this sleight of hand when it states:
There is no conflict between the holding of [Milwaukee Police Ass'n v. City of Milwaukee, 113 Wis. 2d 192, 335 N.W.2d 417 (Ct. App. 1983) ("Milwaukee ///")] that a dispute is not arbitrable if the collective bargaining agreement does not expressly make it arbitrable, and the holdings of Milwaukee I and Milwaukee II that require the arbitration clause to "cover the grievance on its face." See, e.g., Black's Law Dictionary 609 (7th ed. 1999) (equating "on the 'face'" with the "explicit part of writing").9
¶ 44. In short, the long-standing Wisconsin/U.S. Supreme Court test requires that arbitration provisions are to be liberally and generously construed to cover an asserted dispute; that there is "a broad presumption of arbitrability"; and that an issue should be found arbi-trable if "the arbitration clause can be construed to cover the grievance on its face."10 Arbitration is denied only when, as the court stated in Milwaukee I, "it may be *448said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute."11
HH I — I
¶ 45. When the long-standing two-prong test of arbitrability is properly applied in the present case, rather than the new test set forth by the majority opinion, the only conclusion that can be reached is that the grievance is arbitrable.
¶ 46. As to the first prong of the test, the arbitration clause in the present case "can be construed to cover the grievance." The applicable provisions in Articles 5 and 9 of the collective bargaining agreement are as follows:
ARTICLE 5
MANAGEMENT RIGHTS
Union recognizes the prerogative of the City and the Chief of the Fire Department to operate and manage its affairs in all respects, in accordance with its responsibilities and the powers or authority which the City has not officially abridged, delegated or modified by this Agreement and such powers or authority are retained by the City.
These management rights include, but are not limited to the following:
A. To utilize personnel, methods, procedures, and means in the most appropriate and efficient manner possible.
*449B. To manage and direct the employees of the Fire Department.
C. To hire, schedule, promote, transfer, assign, train or retrain employees in positions within the Fire Department.
D. To suspend, demote, discharge, or take other appropriate disciplinary action against the employees for just cause.
K. Any dispute with respect to Management Rights shall not in any way be subject to arbitration but any grievance with respect to the reasonableness of the application of said Management Rights may be subject to the grievance procedure contained herein.
ARTICLE 9
GRIEVANCE AND ARBITRATION PROCEDURE
A. Only matters involving interpretation, application, or enforcement of the terms of this Agreement shall constitute a grievance under the provision set forth herein.
I. ARBITRATION may be resorted to only when issues arise between the parties hereto with reference to the interpretation, application or enforcement of the provisions of this Agreement.
CBA (emphasis added).
¶ 47. Article 5.C. provides that the management rights are reserved to the City and Chief. These management rights include the rights to "hire, schedule, *450promote, transfer, assign, train or retain employees in positions with the fire department" and "to suspend, demote, discharge, or take other appropriate disciplinary action against the employee for just cause."12 Article 5.K. further provides, however, that "any grievance with respect to the reasonableness of the application of said Management Rights may be subject to the grievance procedure contained herein."13
¶ 48. Gentilli's grievance involves the reasonableness of the application of the management right to promote him. Thus, as the majority opinion correctly explains, Article 5.K. "might be read to generally permit arbitration of disputes regarding the reasonableness of individual applications of reserved management rights."14
¶ 49. I turn now to the second prong of the test: Does any provision of the collective bargaining agreement expressly exclude arbitrability of the grievance?
¶ 50. The collective bargaining agreement places two relevant limits on the arbitrability of disputes in Article 9. No other provision of the collective bargaining agreement specifically excludes this grievance.
¶ 51. First, Article 9.Q.1 of the agreement states, "Arbitration shall be limited to grievances over matters involving interpretation, application or enforcement of the terms of this Agreement."15 Gentilli's grievance implicates the application of a term of the agreement, namely application of the management right to pro*451mote. Thus Gentilli's grievance falls within the express terms of an arbitrable issue and is not excluded by Article 9.Q.I.
¶ 52. Second, Article 9.Q.2 of the agreement states, "Arbitration shall not apply where Section 62.13 of the Wisconsin Statutes is applicable and where Management has reserved rights relating to arbitration in Article 5."16 According to the majority opinion, this provision "specifically and unequivocally excludes arbitration of matters falling within the chiefs or PFC's statutory authority under Wis. Stat. § 62.13" and the power to evaluate qualifications, to appoint, and to promote belongs exclusively to the chief and the PFC under § 62.13.17 Thus, the majority opinion concludes, Gentilli's grievance is not arbitrable.
¶ 53. The majority opinion suffers from two flawed arguments. First, the majority opinion incorrectly argues that the collective bargaining agreement at issue in this case does not grant an arbitrator the authority to consider the applicability of Wis. Stat. § 62.13. The majority opinion notes that the arbitration agreements in Milwaukee I, Milwaukee II, and Glendale Professional Policemen's Ass'n v. City of Glendale, 83 Wis. 2d 90, 264 Wis. 2d 594 (1978), expressly granted arbitrators the power to consider the chiefs statutory authority, while Article 9.Q.2 here expressly excludes arbitration where Wis. Stat. § 62.13 applies. The majority opinion suggests that this distinction eliminates an arbitrator's authority to determine whether § 62.13 applies in the first place.
¶ 54. The majority's conclusion, however, ignores Article 9.Q.I. Article 9.Q.1 states that arbitration is *452available for grievances involving "interpretation ... of the terms of this Agreement." Article 9.Q.2, excluding arbitration where § 62.13 applies, is, of course, a term of the agreement. Thus, the collective bargaining agreement at issue here, like those in Milwaukee I, Milwaukee II, and Glendale, authorizes arbitrators to consider whether the chiefs statutory powers under § 62.13 are applicable to a particular grievance.
¶ 55. Second, and more importantly, the majority opinion improperly compares the collective bargaining agreement in this case to the broad agreement in Milwaukee III and not the more limited agreement at issue in Glendale.
¶ 56. The crux of the majority opinion is that arbitration of the decision to deny a promotion during a period of probation directly conflicts with the chiefs authority under Wis. Stat. § 62.13 and is therefore invalid. Resting heavily on the court of appeals' decision in Milwaukee III,18 the majority opinion concludes, "any interpretation of the agreement that would effectively transfer" the chiefs right to promote officers under § 62.13 "would clearly conflict with § 62.13."19
¶ 57. The majority opinion's conclusion, however, fails to account for this court's decision in Glendale. The collective bargaining agreement in Glendale required that the chief promote the most senior qualified candidate. When a vacancy opened up, however, the chief promoted the officer who received the highest test score on a qualifying examination, despite the fact that of the three officers identified with the highest qualifying test scores, the selected officer was not the most senior. The promotion decision was submitted to arbitration, and *453the arbitrator ordered the City to promote the most senior officer among the three highest scoring officers.
¶ 58. This court approved the order of the arbitrator, concluding that the collective bargaining agreement's requirement to promote based on seniority did not "take away power expressly conferred by law"; rather, it "merely restricts the discretion that would otherwise exist."20
¶ 59. The Glendale court explained that a collective bargaining agreement may restrict the promotional authority of the PFC and the chief as long as it does not transfer or displace that promotional authority in violation of Wis. Stat. § 62.13. The court stated as follows:
Although by entering into the collective bargaining agreement the City relinquished some of the discretion the Chief and the Board enjoyed previously concerning appointments and promotions, it has not transferred from the Chief or the Board the authority to determine who is qualified, and it has not transferred away the appointing authority.21
¶ 60. The collective bargaining agreement in the present case is analogous to the agreement in Glendale. It does not transfer the chiefs authority to promote (or demote) officers under Wis. Stat. § 62.13 to an arbitrator. Rather, it simply limits the chiefs authority by requiring that the chief be reasonable in the application of this management right.
¶ 61. The majority opinion mischaracterizes the scope of the restriction placed on the chiefs promotion and demotion authority under the collective bargaining *454agreement in the present case by framing the dispute based on the relief sought in Gentilli's grievance, not the agreement itself. The majority writes, "Gentilli's grievance seeks an arbitrator's reversal of the chiefs decision, restoration of the promotion, and back wages and benefits."22 The grievance, according to the majority, therefore seeks an arbitrator's determination as to who is qualified for appointment and promotion — a power statutorily vested solely with the chief and the PFC.
¶ 62. The fact that Gentilli wishes to have his promotion restored does not mean that the collective bargaining agreement transfers the authority to decide who is qualified for a promotion to an arbitrator. In Glendale, the grievance of the most senior officer seeking promotion sought the same relief: order the Chief to promote the grieving officer despite the Chiefs decision to the contrary.
¶ 63. Yet this court correctly interpreted the grievance in Glendale not as a request to displace the Chiefs authority to determine qualified officers under Wis. Stat. § 62.13 but as a request to enforce the limitation on that authority bargained for under the collective bargaining agreement. The Glendale decision explained: "Under the labor agreement, the chief is under no compulsion to promote an unqualified person or a person determined solely by the union. The seniority restriction operates only where there is more than one qualified candidate."23
¶ 64. The same conclusion must be reached in the present case. The collective bargaining agreement does not compel the chief to promote an unqualified person *455or a particular person. It requires only that the chiefs discretion to promote qualified people be exercised reasonably.
¶ 65. Gentilli alleges that "the Madison Fire Department arbitrarily and capriciously revoked [his] status as an Apparatus Engineer." He believes that he was denied his promotion eleven months into a twelvemonth period of probation because of a heated discussion with a senior officer despite receiving satisfactory marks on his performance evaluation, and that this decision was unreasonable and therefore subject to arbitration under the collective bargaining agreement.24
¶ 66. As the hearing examiner properly concluded, "whether the revocation of Gentilli's probationary status in the Apparatus Engineer position constituted appropriate discipline for the violation of a work rule, a demotion, or the unreasonable application of certain management rights are issues that are to be decided by an arbitrator."
¶ 67. The majority opinion avoids a thorough discussion of this court's decision in Glendale by following the decision of the court of appeals in Milwaukee III instead.25 Milwaukee III, however, is inapposite.
¶ 68. In Milwaukee III, the court of appeals refused to permit arbitration of a probationary termination, in part, because the collective bargaining agreement used broad and general terms to describe the arbitrator's authority and the court was reluctant to craft those terms into a mere limitation, not usurpation, of a chiefs statutory authority. The Milwaukee III *456collective bargaining agreement generically provided for arbitration whenever there were "differences" involving the "interpretation, application or enforcement of the provisions" of the agreement. It also granted an arbitrator the authority to hear "matters of departmental discipline involving application of the rules or regulations of the Chief' whenever those matters were not subject to appeal to the PFC.
¶ 69. The Milwaukee III decision, however, expressly distinguished the broad, general terms in the agreement before it from the agreement at issue in Glendale, which, "by express terms, merely required the chief'to appoint the most senior qualified candidate.' "26 The same distinction is properly drawn in this case.27 The collective bargaining agreement here provides, in express terms, that the encroachment on a chiefs statutory authority to promote is limited. Under Article 5.K., the agreement authorizes grievances "with respect to the reasonableness of the application" of management rights.28
*457¶ 70. For the reasons set forth, I dissent.
¶ 71. I am authorized to state that Justices WILLIAM A. BABLITCH and ANN WALSH BRADLEY join this dissent.

 June Weisberger, The Appropriate Scope of Bargaining in the Public Sector: The Continuing Controversy and the Wisconsin Experience, 1977 Wis. L. Rev. 685, 740 (1977).

 Glendale, 83 Wis. 2d at 106.

 The court of appeals certified the following question to this court: "Is a firefighter promoted on a probationary basis but returned to his former rank for failing to successfully complete probation for an allegedly non-disciplinary reason entitled to the just cause protections of § 62.13(e)(em)?"
This court's decision in Kraus v. City of Madison, 2003 WI 51, 261 Wis. 2d 485, 662 N.W.2d 294 answered this question in the negative. If Kraus had concluded that Wis. Stat. § 62.13(5) applies to non-disciplinary demotions, a question would arise whether a just cause hearing under § 62.13(5) is the exclusive remedy and trumps arbitration of grievance in a collective bargaining agreement. The parties do not brief or argue this point, and I do not address it directly. For a discussion of exclusivity, see City of Madison v. Dept. of Workforce Development, 2003 WI 76, City of Janesville v. WERC, 193 Wis. 2d 492, 535 N.W.2d 34 (Ct. App. 1995).

 City of Milwaukee v. Milwaukee Police Ass'n ('Milwaukee II'), 97 Wis. 2d 15, 22, 292 N.W.2d 841 (1980) (citing to Joint Sch. Dist. No. 10 v. Jefferson Educ. Ass'n, 78 Wis. 2d 94, 111, 253 N.W.2d 536 (1977)) (emphasis added).

 Majority op., ¶ 20.

 Id.

 Id., ¶ 21.

 Id., ¶ 31 n.8.

 See majority op., ¶ 20 (quoting Milwaukee II, 97 Wis. 2d at 22).

 See majority op., ¶ 20 (quoting Milwaukee Police Ass'n v. City of Milwaukee, 92 Wis. 2d 145, 152, 285 N.W.2d 119 (1979) (Milwaukee I) (quoting United Steelworkers of Am. v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582-83 (1960))).

 See CBA, Articles 5.E., 5.E.

 See CBA, Article 5.K. (emphasis added).

 See majority op., ¶ 26.

 See CBA, Article 9.Q.1 (quoted in majority op., ¶ 25).

 See CBA, Article 9.Q.2 (quoted in majority op., ¶ 25).

 See majority op., ¶¶ 26-27.

 Majority op., ¶¶ 30-32.

 Majority op., ¶ 33.

 Glendale Prof'l Policemen's Ass'n v. City of Glendale, 83 Wis. 2d 90, 102-03, 264 Wis. 2d 594 (1978).

 Glendale, 83 Wis. 2d at 107.

 Majority op., ¶ 28.

 Glendale, 83 Wis. 2d at 106.

 Gentilli was apparently the only officer among 54 who did not successfully complete the probationary period.

 Majority op., ¶¶ 30-32.

 Milwaukee Police Ass'n v. City of Milwaukee, 113 Wis. 2d 192, 197, 335 N.W.2d 417 (Ct. App. 1983) CMilwaukee III).

 The Milwaukee III decision is distinguishable for other reasons as well. Milwaukee III involved an initial probationary period, while this case involves a promotional probationary period. Milwaukee III involved the application of Wis. Stat. § 165.85, which applies to law enforcement officers, while this case involves firefighters.

 The majority opinion also misreads the holding of Milwaukee III. The majority opinion states that Milwaukee III concluded the grievance was not arbitrable because" 'the strong public policy behind secs. 62.13 and 165.85, Stats., would be thwarted if the broad, general, and not express language of the collective bargaining agreement were read to make probationary terminations arbitrable.1" Majority op., ¶ 31 n.8 (quoting *457Milwaukee III, 113 Wis. 2d at 198). While Milwaukee III may plausibly be read to rest on this conclusion, the language of the decision is confused and such a reading violates the two-prong test for arbitrability announced in Milwaukee I. the Milwaukee III decision actually concluded that whenever a provision of a collective bargaining agreement is in direct conflict with a statute, the statute governs. See Milwaukee III, 113 Wis. 2d at 196. It is this latter reading of the decision that should be followed.