Racine County v. International Ass'n of MacHinists & Aerospace Workers District 10, AFL-CIO
Racine County v. International Ass'n of MacHinists & Aerospace Workers District 10, AFL-CIO
Opinion of the Court
¶ 1. This is a review of
¶ 2. Petitioners, Racine County and Kevin B. Van Kampen (Van Kampen), who is the Racine County Family Court Commissioner and Director of Family Court Counseling Services, (collectively, Racine County), seek review of an unpublished decision of the court of appeals. The court of appeals' decision reversed and remanded the order of the Circuit Court for Racine County, Judge Wilbur W. Warren III of the Circuit Court for Kenosha County, presiding.
¶ 3. We reverse the decision of the court of appeals. We hold that the circuit court properly vacated the arbitration award here that was contrary to statutory law, specifically Wis. Stat. § 767.405, and to constitutional separation of powers principles. We also hold that the arbitration award in this case was properly vacated because the arbitrator exceeded her authority under Wis. Stat. § 788.10(l)(d) by not considering § 767.405 and the relevant case law.
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¶ 4. In the autumn of 2003, family court social workers/case managers, Donald LaFave (LaFave), Judith Berndt (Berndt), and Janet Vuvunas (Vuvunas) met with Van Kampen and were advised of the possibility of early retirement or layoff. LaFave and Berndt were told that their positions would be eliminated and that there was the possibility of working after their retirement as social workers for the county on a contract basis. Vuvunas was told that her position would be
¶ 5. Van Kampen met with LaFave and Berndt, in addition to John Engel (Engel), who was a retired county social worker supervisor. Van Kampen advised the three individuals that the county executive had directed him to provide the statutorily-mandated services by entering into individual contracts with social workers/case managers.
¶ 6. On March 8, 2004, the IAM filed a grievance on the matter against Racine County, and the case proceeded to arbitration on October 26, 2004. The issue at arbitration was framed by Arbitrator Janice Frank-
¶ 7. On January 19, 2005, the arbitrator ruled in favor of the IAM, sustaining the grievance.
¶ 8. Racine County filed a petition in the circuit court to vacate the arbitration award. On February 5, 2006, the circuit court granted Racine County's petition and vacated the award. The circuit court held that Van Kampen was paid by the county, but he was hired by and reported to the Circuit Court Judges in Racine County, subject to the approval of the Chief Judge of the District. The circuit court also held that Wis. Stat. § 767.405(2) gave the director discretion on how to provide the services in question, and the director was free to fill the positions with county employees, independent contractors, or a mix of both options. The circuit court determined that the three positions were not bargained for positions and that the positions were vacant by virtue of retirements and a voluntary layoff. As a result, the director had discretion in filling these statutorily mandated positions. Accordingly, the union had no vested right in the three positions, and the union could not tell the director how to fill the positions. The circuit court determined that the case was a separation of powers case, and the arbitrator's award ignored the ramifications of Wis. Stat. § 767.405 by
¶ 9. The IAM appealed the circuit court's decision. A divided court of appeals reversed the circuit court's order and remanded the case to the circuit court to reinstate the arbitrator's award. The majority in the court of appeals held that the circuit court had erred as a matter of law in vacating the arbitrator's award. Judges Daniel E Anderson and Richard S. Brown were in the majority, and Judge Neal E Nettesheim dissented. Judge Nettesheim agreed with the circuit court's conclusion that the arbitrator had exceeded her powers by failing to consider the relevant statutory law. He saw this case as one that was controlled by the Iowa County decision, where the register in probate position was covered by a collective bargaining agreement. In his dissent, Judge Nettesheim stated:
Like the statutory authority conferred by Wis. Stat. § 851.71 on the Iowa County circuit judge to appoint a register in probate, here director Van Kampen, acting*518 as an agent of the judiciary, has the statutory authority under Wis. Stat. § 767.405(2)(a) to employ staff to provide the mandated statutory services. And finally, like the Iowa County judge, director Van Kampen, although the hiring authority, is not the employer. Thus the question posed here is the same as that in Iowa County — when the positions became vacant, was Van Kampen bound by the collective bargaining agreement, or was he free to exercise his statutory authority to employ outside the agreement? Iowa County answers in favor of the latter.
Racine County v. Int'l Ass'n of Machinists & Aerospace Workers, Dist. 10, No. 2006AP964, unpublished slip op., ¶ 20 (Wis. Ct. App. May 9, 2007) (Nettesheim, J., dissenting) (footnote omitted). Judge Nettesheim was satisfied that this case implicated separation of powers concerns, given that Van Kampen was an agent of the judicial branch.
¶ 10. Racine County and Van Kampen petitioned for review of the court of appeals' decision in this case, and we granted that petition.
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¶ 11. The standard of review when reviewing an arbitrator's award generally is very limited. Lukowski v. Dankert, 184 Wis. 2d 142, 149, 515 N.W.2d 883 (1994); see also City of Madison v. Madison Prof'l Police Officers Ass'n, 144 Wis. 2d 576, 586, 425 N.W.2d 8 (1988). When a court is reviewing an arbitrator's award, its function is essentially supervisory in nature, to ensure that the parties to the collective bargaining agreement received the arbitration process for which they bargained. Lukowski, 184 Wis. 2d at 149. However, a court must overturn an arbitrator's award when the arbitrator
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¶ 12. The first issue is whether the circuit court properly vacated the arbitration award in this case. The arbitration award allegedly violated both statutory law and constitutional separation of powers principles.
¶ 13. On review, Racine County argues that the arbitrator's award improperly conflicted with statutory law and with the constitution, thus implicating separation of powers principles. Racine County contends that the award here undermines the separation of powers set forth in Wis. Stat. § 767.405 by voiding contracts that the director, a representative of the judicial branch, entered into under that statute, by prohibiting the director from contracting with any other social workers to provide the statutorily-required services, and by ordering, instead, that the union and the county negotiate for the employment of social workers/case managers.
¶ 14. Racine County also argues that the arbitrator erroneously stripped the Racine County Circuit Court Judges of their ability, through their designated director, to contract with social workers to provide the statutorily-mandated services. Racine County argues
¶ 15. On review, the IAM argues that the arbitrator's factual findings do not conflict with the director's statutory authority or the judiciary's constitutional authority. The union also asserts that the award does not present separation of powers concerns because it simply prevents Racine County from relabeling employees as independent contractors to evade its obligations under the collective bargaining agreement. As a result, the IAM claims that the arbitration award here cannot be overturned by the court, and the union also contends that the majority in the court of appeals was correct in upholding the award.
¶ 16. For the reasons discussed in detail below, we are satisfied that the circuit court properly vacated the arbitration award here because it was contrary to statutory law, specifically Wis. Stat. § 767.405, and to constitutional separation of powers principles.
¶ 17. Statutory authority and responsibilities are provided in Wis. Stat. § 767.405. Van Kampen, the
¶ 20. We also are satisfied that the present case is analogous to the court of appeals' decision in Crawford County, 177 Wis. 2d at 66. In Crawford County, the court of appeals extended the reasoning of our Iowa
¶ 22. It was pursuant to this statutory authority that Van Kampen contracted with Berndt, LaFave, and Engel after Racine County eliminated the three original positions. It is this statutory right to hire, as a judicial branch agent, which the collective bargaining agreement and the arbitration award erroneously attempted to take away from Van Kampen. Any provisions of a collective bargaining agreement that attempt to take away such statutory authority are invalid and unenforceable. In essence, by ordering the director to cease and desist from using the current independent contractors or any future independent contractors, the arbitrator exceeded her authority and violated separation of powers principles by putting into jeopardy the effective functioning of the judicial branch, including apparently more than 450 pending Racine County family court matters.
¶ 25. In Winnebago County, the court of appeals held that represented employees might have contrac
¶ 26. We are satisfied that the court of appeals' decision in County of Eau Claire v. AFSCME Local 2223, 190 Wis. 2d 298, 526 N.W.2d 802 (Ct. App. 1994), does not conflict with our holding here. The County of Eau Claire decision involved the Eau Claire County Clerk of Court and the Eau Claire County Register of Deeds deputizing "virtually every employee in their respective offices" in an alleged attempt to exempt those employees from coverage under the collective bargaining agreement. Id. at 300. Unlike the present case, the employees in the County of Eau Claire decision were continuing employees who, other than being deputized, did not see any change in their employment status. Id. The County ofEau Claire decision did not involve voluntary layoffs, retirements, or any questions on how positions were to be filled.
¶ 27. We are satisfied that Racine County's reasons for terminating the positions in question are not
¶ 28. As Judge Nettesheim aptly noted in his dissent in the court of appeals:
Based on Wis. Stat. § 767.405, the trial court saw this case not merely as a contract dispute between the union and the county, but also as a case that raised separation of powers concerns. The court correctly observed that director Van Kampen serves as an agent of the judicial branch of government and that the statute vests discretion in the director as to how the services mandated by the statute should be delivered. The court also correctly noted that when initially filling the positions at issue, Van Kampen could have used independent contractors and that the employees actually hired were not "bargained for positions." From this, the court concluded "that the Director had the authority under the statute to either hire employees to do the work, contract out to do the work or to combine the two methods of providing services in his discretion, subject only to the oversight of the Judiciary that appointed him."
Racine County, No. 2006AP964, unpublished slip op., ¶ 17 (Nettesheim, J., dissenting). We agree with Judge Nettesheim's analysis, as well as that of Judge Warren, on this issue.
¶ 29. In summary, we hold that the circuit court properly vacated the arbitration award here, because it was contrary to statutory law and to constitutional separation of powers principles.
¶ 30. The second issue is whether the arbitration award was properly vacated, because the arbitrator exceeded her authority under Wis. Stat. § 788.10 by not considering Wis. Stat. § 767.405 and the relevant case law.
¶ 31. On review, Racine County argues that the arbitrator exceeded her authority by improperly disregarding the law, specifically Wis. Stat. § 767.405. Racine County also contends that the majority in the court of appeals erred by misinterpreting the scope of its review under Wis. Stat. § 788.10. Racine County argues that the majority improperly limited its review to whether the arbitrator reasonably interpreted the contract, and Racine County contends that the implications of § 767.405 should have been addressed by the arbitrator. Racine County argues that the majority's refusal in the court of appeals to consider the statutory issues involved in this case effectively voided § 788.10 because that statute would be meaningless if the courts were restricted from considering such statutory provisions when determining whether an arbitrator exceeded his or her powers. Racine County contends that the arbitrator exceeded her authority and manifestly disregarded the law when she failed to consider the impact of § 767.405. As a result, Racine County argues that the circuit court properly vacated the arbitrator's award.
¶ 32. On review, the IAM argues that an appellate court is bound by an arbitrator's factual findings, which, in this case, the IAM claims were "that the Racine County executive engaged in a scheme to mis-classify employees as 'independent contractors' to evade the [collective bargaining] agreement." As a result, the union argues that the majority in the court of appeals
¶ 33. We are satisfied that the arbitration award in the present case must be vacated because the arbitrator exceeded her powers under Wis. Stat. § 788.10(l)(d) when she failed to consider Wis. Stat. § 767.405 and the relevant case law, primarily the decisions in Iowa County and Crawford County. Specifically, the award here must be vacated because the arbitrator exhibited a manifest disregard for the law by making no attempt to apply or interpret the relevant statutory law, § 767.405. The dissent's assertion that there was "no indication" that the County raised statutory and "separation of powers arguments until the case reached the circuit court" is not accurate. Dissent, ¶ 48. In Racine County's postarbitration brief to the arbitrator, Racine County stated, "Mr. Van Kampen's testimony further indicated that by statute the services are funded through three types of fees, and that there's a substantial difference in the ability to use these funds [depending on by whom] the services are being provided ...." (Emphasis added.) It must be emphasized that the arbitrator candidly admitted in her award that she made "no attempt... to either interpret or apply statutory law."
¶ 34. As we noted above, Wis. Stat. § 788.10(1)(d) requires a court to vacate an arbitrator's award when the arbitrator exceeds his or her powers. An arbitrator exceeds his or her powers when the arbitrator demonstrates either " 'perverse misconstruction'" or" 'positive
¶ 35. The majority in the court of appeals erred by failing to consider fully, as allegedly falling outside of the scope of its review, the statutory issue that Racine County properly raised. The majority in the court of appeals erroneously limited its review to the collective bargaining agreement's terms on the grounds that the arbitrator had limited her review to the terms of the collective bargaining agreement. The majority in the court of appeals also erred when it approved of the fact that the arbitrator had not considered the statutory and constitutional issues Racine County presented.
¶ 36. In summary, we hold that the arbitration award in the present case must be vacated because the arbitrator exceeded her authority under Wis. Stat. § 788.10(l)(d) by not considering Wis. Stat. § 767.405 and the relevant case law.
V
¶ 37. We reverse the decision of the court of appeals. We hold that the circuit court properly vacated the arbitration award here that was contrary to statutory law, specifically Wis. Stat. § 767.405, and to constitutional separation of powers principles. We also hold
By the Court — Reversed and remanded to the circuit court for all necessary actions that are consistent with this opinion.
Racine County v. Int'l Ass'n of Machinists & Aerospace Workers, Dist. 10, No. 2006AP964, unpublished slip op. (Wis. Ct. App. May 9, 2007).
Judge Warren was assigned to preside over the case after all of the Circuit Court Judges for Racine County recused themselves. It is reasonable to infer from this fact in the record that they did so because there could be a conflict of interest perceived if they ruled on these matters, because the appointment authority of those circuit court judges was clearly involved here. ,
All further references to the Wisconsin Statutes are to the 2005-06 version unless otherwise noted.
Wisconsin Stat. § 767.405(2)(b) states that the director shall "[cjontract under sub. (3)(c) with a person or public or private entity to perform mediation and to perform any legal custody , and physical placement study services authorized under sub. (14)." Wisconsin Stat. § 767.405 was previously numbered Wis. Stat. § 767.11, but the statutory language remains unchanged.
These moves were the result of the Racine County Executive's desire to move the family court social worker/case manager positions off of the tax levy to spare layoffs elsewhere in the county.
The dissent repeatedly refers to "actions taken by the County" and also refers to our not "focusing on the County's actions and instead attribut[ing] those actions to the director of family court services, Van Kampen." Dissent, ¶ 39. We are satisfied that the plans were carried out with the director's approval and with the director's consultation with the circuit
The dissent also errs in stating, "The arbitration decision and Van Kampen's testimony make it clear that it was the County, not Van Kampen, that required the social worker positions to be filled by subcontractors." Id., ¶ 65. In contrast to the dissent's assertion, the record before us clearly shows that Racine County did not dictate to Van Kampen how the positions were to be filled. Racine County's postarbitration brief to the arbitrator discusses at great length the various options that Van Kampen considered in order to provide the statutorily-mandated services. This contradicts the dissent's assertion that Van Kampen was not exercising his statutory authority.
As retirees, LaFave, Berndt, and Engel were entitled to health insurance, but the county did not have to pay employment taxes or provide any other benefits.
The dissent criticizes the majority opinion for spending "a scant four paragraphs explaining the arbitrator's determinations." Dissent, ¶ 42. The dissent then goes on to state, "The abbreviated treatment given by the majority to the actual decision of the arbitrator leaves a void." Id., ¶ 45. The dissent also criticizes us for "ignor[ing] the arbitrator's factual and legal determinations." Id., ¶ 57. We disagree with the dissent's assertions. Our treatment of the arbitrator's award is proper because the entire award was invalid. Furthermore, in contrast to the dissent's assertion, our application of the standard of review is appropriate because the arbitrator exceeded her powers in the present case. Id., ¶ 56.
We note that Borland v. Eau Claire County, 216 Wis. 2d 560, 575 N.W.2d 691 (1998), is distinguishable from the present case because Borland was premised on the inherent powers of the judicial branch, not on a conflict with governing statutory law. In Borland, this court held that circuit court judges had the "exclusive, inherent constitutional authority to prevent the unilateral removal of their judicial assistants by way of a collective bargaining agreement between [a] county government and its employees." Id. at 565. In contrast, in the present case, the arbitration award did not implicate the inherent powers of the judicial branch. Instead, the arbitration award in the present case conflicted with Wis. Stat. § 767.405.
We further note that our recent Kocken decision also is distinguishable from the present case. Kocken v. Wis. Council 40, AFSCME, 2007 WI 72, 301 Wis. 2d 266, 732 N.W.2d 828. In Kocken, we held that a county sheriff did not have the authority, contrary to a collective bargaining agreement, to hire and fire the personnel who provided the county jail's food service. Id., ¶ 4. We so held because that right was "not a time immemorial, principal, and important duty that characterizes and distinguishes the office of [the] sheriff," and, as a result, that ability was "not within the Sheriffs constitutional powers." Id. The sheriff was not given hiring and firing authority in regard to such personnel by statute either, and, therefore, he was subject to the restrictions of the relevant collective bargaining agree
Prior to Wis. Stat. § 767.405 being enacted by 1987 Wis. Act 355, the social workers/case managers here were employed by Racine County under the collective bargaining agreement, providing services similar to those now covered by the statute. As was discussed by the attorney representing Racine County at oral argument before this court, when § 767.405 was enacted, these employees continued to provide such services, but then did so under the supervision of the director of family court services. The attorney representing the union did not challenge this historical recitation.
The Crawford County court held, however, that whether the administrative law clerk position in the district attorney's office should be included under all of the terms and conditions of the collective bargaining agreement was a mandatory subject of bargaining. Crawford County v. WERC, 177 Wis. 2d 66, 68-69, 501 N.W.2d 836 (Ct. App. 1993). The court so held because, unlike the other two positions, there was no specific statute that gave a district attorney an ability to appoint deputies who would serve at his or her pleasure. Id. at 71-72.
This issue and these figures were presented at oral argument before this court.
The dissent argues that Vuvunas' "layoff, therefore, [was] a 'direct result of such subcontracting.'" Dissent, ¶ 71. The record before us on review shows that the dissent's contention is erroneous. As we noted previously, Racine County's postarbitration brief, which is in the record before us on review, indicates that Racine County's Human Resources Director, Karen Galbraith, testified at the arbitration hearing that "Ms. Vuvunas requested a voluntary layoff rather than exercise her bumping rights. That request was granted. If Ms. Vuvunas had exercised her bumping rights, no employee would have been laid off because there were vacant positions available." The record before us on review also shows that Galbraith further testified at the arbitration hearing "that there were vacant positions available into which [all three] employees could have bumped, which would have resulted in no layoffs occurring as a result of eliminating these positions."
The majority explains its limited treatment of the facts and its decision to ignore the arbitrator's factual and legal determinations as following from its determination that "the entire award is invalid." Majority op., ¶ 7 n.8. The reason we review carefully all of the arbitrator's factual and legal determinations is to determine whether the award is valid. The majority's explanation simply assumes the answer to the very question before the court.
Rather than taking the facts as determined below by the fact finder (the arbitrator), the majority has decided to instead find its own "facts." From the circuit judges' recusal, the majority makes a factual determination that Van Kampen consulted with each of the Racine County circuit judges. Majority op., ¶ 5 n.6. From Van Kampen's consideration of "various options" in how to fund subcontractors, the majority concludes that the County did not dictate to Van Kampen that the positions must be eliminated and filled by a subcontractor rather than an employee. Id. From the fact that Van Kampen mentioned a statute at the arbitration hearing, the majority concludes that the arbitrator was actually presented with the complex statutory and constitutional questions at issue here. Id., ¶ 33.
Dissenting Opinion
¶ 38. {dissenting). The error of the majority lies in what it avoids. This case involves two actions. The first is the process of eliminating three social worker positions. The second is entering into contracts to fulfill the statutory responsibility of providing social work. Even though the first action, the process of eliminating the positions, is the basis of the arbitrator's award, the majority nevertheless addresses only the second.
¶ 39. This case stems from actions taken by the County. The majority, however, avoids focusing on the County's actions and instead attributes those actions to the director of family court services, Van Kampen. As a result, it subordinates the actions of directors to the demands of the County.
¶ 40. Finally, this case involves an arbitrator's determination that a County employee, Vuvunas, was laid off in direct violation of a collective bargaining agreement. The majority, however, fails to explain why that determination is error, despite vacating the arbitration award.
¶ 41. By failing to address the process by which the County eliminated the three positions, attributing-the County's actions to Van Kampen, and failing to address Vuvunas's layoff, the majority ignores the standard of review and the determinations of the arbitrator that this court should not disturb. Despite its claim of
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¶ 42. Despite the fact that the arbitration decision, coupled with the collective bargaining agreement, provides the factual basis of this case, the majority spends a scant four paragraphs explaining the arbitrator's determinations. See majority op., ¶¶ 4-7. It nevertheless argues that the arbitration award should be vacated because "the arbitrator exceeded her authority and violated separation of powers principles." Id., ¶ 22.
¶ 44. The consequences of the arbitration award, according to the majority, are dire. It asserts that the award "left [LaFave, Berndt, and Engel] without an ability to work for Racine County." Id., ¶ 7. In so doing the arbitrator "put[] into jeopardy the effective functioning of the judicial branch." Id., ¶ 22.
¶ 46. According to the arbitration decision, the County decided to eliminate the positions in order to take them off the tax levy and informed the director, Van Kampen, of its decision in mid-2003. As the majority notes, in the fall of 2003 LaFave and Berndt were informed that their positions were being eliminated and Vuvunas was told that her position was being reduced to part-time status and that she could choose to exercise bumping rights or be laid off. Neither LaFave nor Berndt had planned to retire when they did until they learned of the plan to eliminate their positions.
¶ 47. Van Kampen advised them that the county executive had directed him to provide the statutorily mandated services by entering into individual contracts. The County negotiated service agreements with LaFave and Berndt to provide social work after their retirement. At the direction of County corporate counsel, Van Ka-mpen discussed setting up limited liability corporations with them.
¶ 48. After LaFave and Berndt retired and came back to work, and after Vuvunas was laid off, the Union filed a grievance pursuant to its right under the collective bargaining agreement. The parties submitted to arbitration of the case as a contract issue. Because the parties submitted a contract issue, the arbitrator limited her award to the terms of the parties' contract, and did not stray from the positions argued by the parties into the area of statutory law. There is no indication that the County raised its Wis. Stat. § 767.405 and separation of
¶ 49. The Union argued that the County violated the terms of the collective bargaining agreement and "engaged in a subterfuge resulting in performance of bargaining unit work performance pursuant to individual contracts and improper lay-off. ..." It also asserted that the County's discussions with LaFave and
¶ 50. The County maintained that it did not violate the collective bargaining agreement and that the retirements of LaFave and Berndt and the lay-off of Vuvunas were voluntary. It further argued that its discussions with LaFave and Berndt did not constitute promises for future contracts.
¶ 51. The arbitrator determined that the County improperly displaced the three positions and violated several provisions of the collective bargaining agreement, including the recognition and subcontracting provisions. She further determined that the positions had not been eliminated, but instead that the County had simply "replaced [the] bargaining unit positions with the identical service provided under individual contracts." Despite the fact that the County "narrowly focused upon the topic of sub-contracting," the arbitrator determined that the service agreements entered by Berndt, LaFave, and Engel "are not sub-contracts" insofar as they "do not provide new or temporary service or service supplemental to that being provided in part by bargaining unit members."
¶ 52. The positions, according to the arbitrator, "have not been truly eliminated." Instead, the arbitrator agreed with the Union that the County orchestrated LaFave's and Berndt's retirements and that they were motivated to retire by the County's offer to enter service agreements with them. Their work and their positions
¶ 53. With respect to Vuvunas, the arbitrator determined that even if LaFave's and Berndt's retirements were independent of the County's actions, "Vu-vunas plainly was deprived of an opportunity to be fully employed in her Court Services Social Worker position" by the service agreements. This action was in direct violation of Article 27.07 of the collective bargaining agreement, which provides in relevant part:
27.07 Racine County reserves the right to subcontract any work normally done by bargaining unit employees, but no bargaining unit employees will be laid off or have their normal hours reduced as a direct result of such subcontracting. . ..
¶ 54. In determining that the County violated the agreement, the arbitrator relied on the testimony of Van Kampen, who "unequivocally testified that he had been directed by the County Executive to enter into Contracts with individuals to provide the statutorily required service 'off the levy.'" Van Kampen further testified that in light of the County's decision "he was very concerned with regard to how the service would be provided." In addition to being worried about how to provide the services when the County informed him of its plan, Van Kampen testified that he di$ not know how the services were going to be provided after the contracts expired on December 31, 2004, less than one
¶ 55. The arbitration award for the violations was that the County could no longer continue or enter agreements that displace bargaining unit positions:
The County shall cease and desist from continuing existing Service Agreements or entering into new Agreements which displace Court Services Social Worker/Case Manager bargaining unit positions consistent with this Opinion. The Union and its members shall be made whole for damages which have been sustained including loss of dues, expenses to pursue this matter, and loss of wages and benefits without loss of seniority.
No specific remedy was set forth because the arbitrator had insufficient evidence of the extent of the Union's damages. The arbitrator was cautious so as not to "fashion [] a remedy which is either impossible or impractical to implement." The arbitrator instead noted that the award "will require discussion and perhaps some negotiation between the parties."
II.
¶ 56. Although the majority cites to the standard of review, it ignores the application of that standard. The role of reviewing courts in arbitration cases is limited, and courts "will not overturn the arbitrator's decision for mere errors of law or fact." Madison v. Madison Prof'l Police Officers Ass'n, 144 Wis. 2d 576, 586, 435 N.W.2d 8 (1988). It will do so only when "perverse misconstruction or positive misconduct is plainly established, or if there is a manifest disregard of the law, or if the award itself is illegal or violates strong public policy." Id. (citing Milwaukee Bd. of Sch. Dirs. v.
¶ 57. Despite this standard of substantial deference, the majority nevertheless ignores the arbitrator's factual and legal determinations. It instead bases its arguments on claims that are belied by the arbitrator's findings.
A
¶ 58. To begin, the majority fails to address the basis of the arbitrator's decision — the process of eliminating the positions. It asserts that Van Kampen acted "after Racine County eliminated the three original positions" and filled "vacated positions" with contractors. Majority op., ¶¶ 22, 19. The basis of the arbitration award, however, is that the County did not really eliminate the positions and then subcontract for the services. Instead, the arbitrator determined that the positions remained intact, with LaFave, Berndt, and Engel doing the same work under the same conditions as was performed before.
¶ 59. Thus, it is the process of eliminating the positions and the fact that LaFave, Berndt, and Engel were not true subcontractors that is the basis of the arbitration award and the respondents' arguments. The arbitrator's decision does not address the prospect that legitimately eliminated or vacated positions could be filled with subcontractors. Indeed, the Union admitted to the circuit court that "[ujnder the collective bargaining agreement, during layoffs there can be subcontracting." Further, there is no question that prior to the events here, LaFave, Berndt, and Vuvunas were County employees subject to the collective bargaining agreement. The County conceded that point at oral argument.
¶ 61. In fact, the arbitrator's conclusion that the County's actions are an improper attempt to circumvent the collective bargaining agreement is supported by the court of appeals decision in County of Eau Claire v. AFSCME, 190 Wis. 2d 298, 526 N.W.2d 80 (Ct. App. 1994). In that case a county clerk of court and register of deeds deputized their employees, and argued that the employees were therefore exempt from a collective bargaining agreement negotiated under Wis. Stat. § 111.70
¶ 62. Similarly, the arbitrator here determined that the County's orchestration of the retirements and service agreements was merely an attempt to circumvent the collective bargaining agreement. Even if the arbitration award would conflict with § 767.405(2),
¶ 63. The majority tries to distinguish this case from County of Eau Claire on the ground that the employees in that case "were continuing employees who, other than being deputized, did not see any change in their employment status." Majority op., ¶ 26. It is difficult to discern the basis for that distinction, as the arbitrator specifically determined that, other than being contractors, LaFave and Berndt saw no change in their employment status, but instead had performed the same work, in the same offices, for the same supervisors, and for the same compensation.
B
¶ 64. By failing to focus on the actions of the County and instead attributing those actions to Van Kampen, the majority opinion again ignores the arbitrator's factual determinations. This error is particularly pernicious, as it ultimately subordinates the actions of directors like Van Kampen, who are agents of the judiciary, to the demands of counties.
¶ 65. The arbitration decision and Van Kampen's testimony make it clear that it was the County, not Van Kampen, that required the social worker positions to be filled by subcontractors. A prior decision had been made to provide the statutorily required social services with bargaining unit employees.
¶ 66. In fact, it was the County that decided the positions would be eliminated, and only after so deciding informed Van Kampen. The arbitrator's decision indicates that Van Kampen did not welcome the changes required by the new directive. He was concerned about how to provide the services under the new regime. Contrary to the majority's suggestion that he was "exercising. .. statutory authority," Van Kampen was forced by the County (i.e., "directed by the County Executive") to use contractors rather than his longtime employees to provide the services.
¶ 67. Given that the County was directing the actions in this case, it is puzzling that the majority purports to protect the rights of the director and the judiciary by vacating the arbitration award. See majority op., ¶¶ 21-22. The parties agree, and the majority acknowledges, that under § 767.405(2) the director is free to fill the positions with County employees, independent contractors, or a mix of both. A director chose to initially employ persons pursuant to § 767.405(2)(a) by filling the positions with County employees, and the County superceded that choice by requiring Van Ka-mpen to provide the services only by contract pursuant to § 767.405(2)(b).
C
¶ 69. The majority also disregards the arbitrator's decision concerning the layoff of Vuvunas. The arbitrator determined that Vuvunas was laid off in direct violation of a collective bargaining agreement. The majority vacates the award with respect to Vuvunas, but fails to explain why the arbitrator's determination was in error.
¶ 70. The arbitrator determined that the County's actions plainly deprived Vuvunas of the opportunity to be fully employed due to the subcontracting, and that this was "in direct violation of Article 27.07 of the Collective Bargaining Agreement." This determination by the arbitrator is a straightforward interpretation of the collective bargaining agreement. Thus, it is a determination that is squarely within the arbitrator's authority to make, and courts will generally not overturn such a decision. See Madison Prof'l Police Officers Ass'n, 144 Wis. 2d at 585-86 (the goal of reviewing an arbitra- • tion decision is "assuring that the parties are getting the arbitration that they contracted for.")
¶ 71. The arbitrator's determination with respect to Vuvunas follows the express language of the collective bargaining agreement. Although section 27.07 provides that the County may subcontract work normally
¶ 72. The majority notes that Vuvunas did not exercise her bumping rights, that the Union filed the grievance rather than Vuvunas, and that Vuvunas's husband retired at roughly the same time she was laid off.
¶ 74. Moreover, the majority appears to conclude that the arbitrator erred in determining that the layoff of Vuvunas violated the collective bargaining agreement. In essence it has reviewed the decision independently of the arbitrator's determination. However, it does so without examining the language of the agreement or explaining why the arbitrator's determination, which follows the express language of the agreement, is incorrect.
¶ 75. In doing so, the majority leaves many questions unanswered. Does the collective bargaining agreement require that wrongly laid-off employees grieve on their own behalf? What does the collective bargaining agreement say about exercise of bumping rights? Does it matter? The effect of the majority's analysis on our review of arbitration decisions is unclear.
I — I I — I I — I
¶ 76. Finally, I address the majority's unsupported claim regarding the consequences of the arbitration award. The majority asserts that the award "left [LaFave, Berndt, and Engel] without an ability to work for Racine County," majority op., ¶ 7, "putting into jeopardy the effective functioning of the judicial branch." Id,., ¶ 22.
¶ 78. The claim that the award jeopardizes the effective functioning of the judicial branch is equally unfounded. To the contrary, it is the County's actions that undermine its effective function. Here, the County wanted the collectively bargained for positions to be off the tax levy. The County, not the circuit court judges, was orchestrating the maneuver. The County, not the arbitrator, was limiting the statutory power of the director of family court services. Contrary to § 767.405(2)(a), the director was not free to fill the positions with County employees. Instead the County required that the positions be filled only by subcontracting the positions. Thus, the majority's concern about effective functioning of the judiciary is more appropriately directed at the County's actions.
IV
¶ 79. For the reasons set forth, I conclude that by failing to address the process by which the County eliminated the three positions, attributing the County's actions to Van Kampen, and failing to address Vuvunas's layoff, the majority ignores the standard of
¶ 80. Accordingly, I respectfully dissent.
¶ 81. I am authorized to state that Chief Justice SHIRLEY S. ABRAHAMSON and Justice LOUIS B. BUTLER, JR. join this dissent.
Wisconsin Stat. § 767.405(2) (2005-06) provides that the director of family court services shall:
(a) Employ staff to perform mediation and to perform any legal custody and physical placement study services ....
(b) Contract under sub. (3)(c) with a person or public or private entity to perform mediation and to perform any legal custody and physical placement study services ....
The majority inexplicably asserts that "the arbitrator had not considered the statutory and constitutional issues Racine County presented." Majority op., ¶ 35. As noted in the text, the statutory and constitutional arguments were not presented to the arbitrator. The "evidence" that the majority adduces as support is a reference to Van Kampen's testimony in the County's postarbitration brief to the arbitrator contesting the award. However, that brief concerns only the contract dispute and makes no mention of the statutory and separation of powers arguments at issue here, indicating that the County did not raise those issues to the arbitrator. Additionally, the brief discusses Van Kampen's testimony (in which he merely mentions a statute) as part of its argument that the County did not violate the terms of the collective bargaining agreement. Rather than demonstrating that the County presented the statutory and separation of powers arguments to the arbitrator, the evidence adduced by the majority indicates that the County presented only contract issues.
Moreover, the majority takes the arbitrator to task for her statement that she made "no attempt... to either interpret or apply statutory law." Majority op., ¶¶ 7, 33. This incorrectly describes the arbitrator's statement. She was explicit that the parties had presented her with a contract question, and that the parties had not argued on the basis of statutory law. It is in that context that the arbitrator wrote: "Accordingly, the Award made here takes its essence entirely from the parties' Contract. There is no attempt here to either interpret or apply statutory law." The majority's implication that the arbitrator simply ignored statutory law that the parties had presented is therefore unfounded.
Wisconsin Stat. §111.70 sets forth the framework for collective bargaining in the municipal employment context.
Wisconsin Stat. § 59.38 provides for the clerks of circuit courts to appoint deputies, and Wis. Stat. § 59.50 provides for the registers of deeds to appoint deputies.
As the majority notes, prior to the passage of § 767.405, the services were provided by the County with bargaining unit positions. After the statute was passed, the director decided to continue providing the services with the employees in the bargaining unit positions. Majority op., ¶ 19 n.10.
The majority cites a reference in a brief to testimony that Vuvunas requested voluntary layoff rather than exercising her bumping rights, and that had she exercised her bumping rights, no employee would have been laid off. Majority op., ¶ 4, ¶ 23 n. 13. As noted above, the majority is engaged in appellate fact-finding. Moreover, it has failed to explain how a voluntary layoff comports with the contract language that is at the heart of this case. The collective bargaining agreement requires that "no bargaining unit employees will be laid off or have their normal hours reduced as a direct result of such subcontracting...." Here, the majority is addressing the question of whether Vuvunas's layoff violates the terms of a contract without reciting, much less examining, the language of the contract.
It is unclear what the timing of Vuvunas's husband's retirement has to do with whether the County's actions in laying Vuvunas off as a result of subcontracting violated the terms of the collective bargaining agreement. The implication from the majority opinion is that she really wanted to be laid off, and that this somehow legitimizes the County's actions.
Reference
- Full Case Name
- Racine County and Kevin B. Van Kampen, Racine County Family Court Commissioner and Director of Family Court Counseling, Petitioners-Respondents-Petitioners, v. International Association of MacHinists and Aerospace Workers District 10, AFL-CIO, Respondent-Appellant
- Cited By
- 14 cases
- Status
- Published