341 P.3d 770
Or. Ct. App.2014Background
- Tom Hurley, a Portland firefighter on disability leave receiving Fund benefits, missed mandatory retraining in Nov 2006 due to outside employment; the Fund terminated his benefits in April 2007 and he did not pursue the Fund’s administrative appeal.
- The City then discharged Hurley in October 2007 for abandonment related to failure to report to a restricted-duty job; the union filed a grievance seeking rescission of the dismissal and reinstatement to disabled status with Fund benefits.
- An arbitrator found the discharge lacked just cause, relying on ERB’s prior ruling that the City’s return-to-work program (and the Fund) were subject to collective bargaining duties, and fashioned a make-whole remedy requiring the City to pay the equivalent of the lost disability benefits unless the Fund assumed responsibility.
- The City refused to implement the award, arguing the arbitrator exceeded authority over Fund benefits (because the Fund is independent and administrative remedies were not exhausted) and adopted a council resolution declining implementation.
- The Portland Fire Fighters’ Association filed a ULP complaint; ERB enforced the arbitration award, holding the arbitrator did not exceed authority and make-whole relief was within remedial powers of arbitration.
- The City sought judicial review; the Court of Appeals affirmed ERB, applying the limited review standard that enforces arbitration awards unless the parties did not agree to binding arbitration or the award contradicts public policy.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the parties agreed to arbitrate the dispute including relief for lost Fund benefits | Grievance and stipulation framed dismissal and requested reinstatement with Fund benefits; union says remedy was arbitrable | City says grievance and CBA deadlines did not preserve the April benefit-cut issue and Fund benefits were outside CBA/arbitration | Held: Parties agreed to arbitrate the discharge and resulting remedy; the arbitrator could award a make-whole remedy including equivalent benefits |
| Whether the arbitrator exceeded an express textual limit in the CBA by restoring benefits | Union: CBA permits make-whole remedies even if not expressly stated; arbitrator stayed within contract interpretation | City: CBA requires grievances identify breaches within 14 days and prohibits altering agreement terms; thus arbitrator lacked authority over Fund benefits | Held: No express textual limit in CBA barred the remedy; general prohibitions did not prevent a make-whole award requiring City to pay equivalent benefits |
| Whether failure to exhaust Fund administrative remedies or timeliness barred arbitration of benefit loss | Union: exhaustion and timeliness are merits determinations for the arbitrator, not limits on his authority | City: Hurley did not appeal to the Fund and the claim is time-barred or non-arbitrable | Held: Such exhaustion and timeliness issues are merits questions for the arbitrator; they do not show lack of arbitrability |
| Whether enforcement would violate public policy or exceed remedial powers | Union/ERB: make-whole remedies are ordinary and within arbitrator’s remedial discretion; enforcement favors finality | City: Award violates City Charter/home-rule by directing relief against an independent Fund or ordering unlawful acts | Held: Court declined public-policy challenge (City abandoned some public-policy arguments); ERB’s enforcement was proper under limited review standard |
Key Cases Cited
- Willamina Sch. Dist. 30J v. Willamina Ed. Assn., 60 Or. App. 629 (court endorses limited review of arbitration awards and enforcement absent express limitation or public policy conflict)
- Portland Fire Fighters’ Assn. v. City of Portland, 245 Or. App. 255 (related ERB decision holding bargaining duties extend to Fund and return-to-work program)
- Chenowith Ed. Assn. v. Chenowith School Dist. 9, 141 Or. App. 422 (arbitrator exceeded express contractual limit by adding terms to agreement)
- Deschutes Cty. Sheriffs Assn. v. Deschutes Cty., 169 Or. App. 445 (parties must accept binding arbitration even if arbitrator’s merits decision is disputed)
- Beaverton Ed. Assn. v. Wash. Co. Sch. Dist. No. 48, 76 Or. App. 129 (arbitrator’s interpretation of arbitrability is for arbitrator absent express contractual limit)
- Steelworkers v. Enterprise Corp., 363 U.S. 593 (arbiter may fashion remedies not expressly provided in contract)
- Corvallis Sch. Dist. v. Corvallis Education Assn., 35 Or. App. 531 (adopting Steelworkers view on arbitrator remedial authority)
- Miller v. City of Portland, 356 Or. 402 (administrative-exhaustion rule not invoked to bar firefighter’s contract claim involving Fund benefits)