353 P.3d 998
Haw.2015Background
- Employer promoted five sergeants from existing list in 2007 after adding an oral interview; SHOPO grieved three non-promotions alleging contract violations.
- Arbitration over three grievances was consolidated; arbitrator heard evidence and issued a June 2, 2009 award promoting all three grievants and awarding back pay and other benefits.
- Circuit Court vacated the remedy portion as beyond the arbitrator’s authority under the contract and Hawaii law; confirmed the rest of the award’s findings of fact and conclusions.
- ICA reversed in part, holding the arbitrator did not exceed authority in granting promotions and back pay and remanded for confirmation of the award in full; the court left public policy questions unresolved.
- The superior court later confirmed the arbitrator’s factual findings while vacating the remedy again; SHOPO appealed; the Hawaii Supreme Court granted certiorari.
- The core question is whether the arbitrator’s remedy (promotions and back pay) was within the scope of authority, and whether the arbitration award violated public policy.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did the arbitrator exceed authority by granting promotions and back pay? | SHOPO argued arbitrator acted within contract interpretation. | Employer argued Article 32 did not authorize promotions/remedies; exceeded powers. | Arbitrator did not exceed authority; promotions/back pay within contract interpretation. |
| Did the award violate public policy? | Award aligned with merit-based promotions and negotiated procedures. | Award contravened public policy against arbitrator-made promotions. | Award did not violate explicit, well-defined public policy; not contrary to merit principles. |
| Is quasi-estoppel applicable to bar challenge to arbitrator’s authority? | UHPA II guidance supports estoppel when arbitration was final and binding. | Agency retained management rights; estoppel does not bar challenge. | Court did not resolve quasi-estoppel here; dismissed as not necessary to decide based on authority finding. |
Key Cases Cited
- Univ. of Haw. Prof’l Assembly v. Univ. of Haw., 66 Haw. 214, 659 P.2d 720 (1983) ( UHPA II; arbitrator may grant tenure/promotion when negotiated; final & binding arbitration)
- Univ. of Haw. Prof’l Assembly v. Univ. of Haw., 66 Haw. 207, 659 P.2d 717 (1983) ( UHPA I; arbitrability decided by arbitrator; contract interpretation preserved)
- Univ. of Haw. v. Univ. of Haw. Prof’l Assembly, 66 Haw. 228, 659 P.2d 729 (1983) ( UHPA III; review of arbitration under final & binding framework)
- Hawaiian Tel. Co., 49 Haw. 53, 411 P.2d 134 (1966) ( limits on judicial review; arbitrator's contract interpretation)
- Tatibouet v. Leeward Bus Co., 99 Haw. 234, 54 P.3d 405 (2000s) ( arbitrator authority under contract interpretation framework)