TEANECK BOARD OF EDUCATION, RESPONDENT, v. TEANECK TEACHERS ASSOCIATION, APPELLANT.
Supreme Court of New Jersey
Argued April 18, 1983—Decided July 18, 1983.
We therefore hold that the failure to assert a claim of discrimination in a grievance proceeding will not preclude the presentation of that claim to the State Division on Civil Rights.
III.
We hold that, although of evidential value, neither failure to present nor unsuccessful prior submission of a discrimination claim to an available arbitration process provided in a labor agreement will foreclose an employee‘s statutory right to present the claim to the Division on Civil Rights.
We reverse the judgment below.
For reversal—Chief Justice WILENTZ, and Justices CLIFFORD, SCHREIBER, HANDLER, POLLOCK, O‘HERN and GARIBALDI—7.
For affirmance—None.
court to give full faith and credit to a state court judgment finding no discrimination. See also Grace, 461 U.S. at 757, 103 S.Ct. at 2186 (allowing enforcement of arbitration award that does not inappropriately affect public policy; although “the conciliation process of Title VII and the collective bargaining process complement each other rather than conflict,” company cannot restrain arbitration).
James P. Granello argued the cause for respondent (Murray & Granello, attorneys; Robert T. Lawless, on the brief).
Robert E. Anderson, Jr., Deputy General Counsel, argued the cause for Public Employment Relations Commission.
Susan L. Reisner, Deputy Attorney General, argued the cause for amicus curiae Attorney General of New Jersey (Irwin I. Kimmelman, Attorney General of New Jersey, attorney; James J. Ciancia, Assistant Attorney General, of counsel).
Steven P. Weissman submitted a brief on behalf of amicus curiae Communication Workers of America, AFL–CIO (Steven P. Weissman, attorney; Thomas S. Adair, a member of the Georgia bar, and Ann F. Hoffman, a member of the New York bar, of counsel).
Paula A. Mullaly, General Counsel, submitted a brief on behalf of amicus curiae New Jersey School Boards Association (Paula A. Mullaly, attorney; Russell Weiss, on the brief).
The opinion of the Court was delivered by
O‘HERN, J.
This appeal requires us to determine whether a teacher‘s claim of reverse discrimination in hiring may be submitted to binding arbitration under the terms of a collective negotiations agreement. We hold that the public employer‘s decision on hiring implicates an exercise of a governmental function that is not subject to binding arbitration, although it is subject to review by the Division on Civil Rights. We affirm the judgment below.
I.
The Teaneck Teachers Association filed a grievance on behalf of John A. Zubiaurre, a teacher, alleging racial discrimination in the Teaneck Board of Education‘s failure to appoint Zubiaurre to the position of Assistant Basketball Coach.1 He is white and alleges that he was not appointed for that reason. The grievance was not resolved in the lower steps of the parties’ collective negotiations grievance procedure. The Association sought arbitration. At a hearing before the arbitrator, the Board raised the issue of arbitrability. The arbitrator found the issue arbitrable, relying upon Article XXVI, Section A, paragraph 2 of the parties’ agreement, which recites that in discharging its functions, the Board shall be “(subject, however, to the provisions of the applicable statutes and rules and regulations of the State Board of Education in such cases made and provided) and all
The Board challenged the arbitrability of the issue in a scope of negotiations proceeding before the Public Employment Relations Commission (PERC). PERC ruled that the disputed issue was based upon allegations of racial discrimination that were within the scope of collective negotiations and could be submitted to arbitration. On the Board‘s appeal, the Appellate Division ruled that the issue of racial discrimination was preempted by the Law Against Discrimination,
II.
In Thornton v. Potamkin Chevrolet, 94 N.J. 1 (1983), we reviewed the relationship between the laws against discrimination and arbitration of labor disputes in the private sector. Arbitration of labor disputes in public sector employment presents additional considerations. “We have heretofore recognized that what may be submitted to binding arbitration in the public sector is circumscribed. Unlike the private sector, prerogatives of management, particularly those involving governmental policy making, cannot be bargained away to be determined by an arbitrator.” Kearny PBA Local # 21 v. Kearny, 81 N.J. 208, 215 (1979).
New Jersey has only two categories of subjects of public employment negotiation: “mandatorily negotiable terms and conditions of employment” and “non-negotiable matters of governmental policy.” In re IFPTE Local 195 v. State, 88 N.J. 393, 402 (1982). In determining those issues that cannot be bargained away, we apply the test of negotiability.
[A] subject is negotiable between public employers and employees when (1) the item intimately and directly affects the work and welfare of public employees; (2) the subject has not been fully or partially preempted by statute or regulation; and (3) a negotiated agreement would not significantly interfere with the determination of governmental policy. [Id. at 404].
The parties concede that the issue intimately and directly affects the work and welfare of public employees. The issues are whether the State‘s Law Against Discrimination preempts negotiation on the subject and whether arbitration of the discrimination issue would significantly interfere with the determination of governmental policy.
To decide whether a negotiated agreement would significantly interfere with the determination of governmental policy, it is necessary to balance the interests of the public employees and the public employer. When the dominant concern is the government‘s managerial prerogative to determine policy, a subject may not be included in collective negotiations even though it may intimately affect employees’ working conditions. Woodstown-Pilesgrove Bd. of Educ. v. Woodstown-Pilesgrove Educ. Ass‘n, 81 N.J. 582, 591 (1980); see also Bethlehem Tp. Bd. of Educ. v. Bethlehem Tp. Educ. Ass‘n, 91 N.J. 38 (1982); Council of N.J. State College Locals v. State Bd. of Higher Educ., 91 N.J. 18 (1982).
That the State‘s Law Against Discrimination sets statutory terms and conditions of employment does not resolve the issue
But here, application of the state statute or regulation would implicate an inherent managerial prerogative. Justice Schreiber, writing for a unanimous Court in Woodstown-Pilesgrove, stressed that if the subject “is ‘a matter of essential
PERC recognized that its precedents were to the same effect: that the decision to hire, promote, or replace teaching staff members is not subject to review by an arbitrator. In re Mainland Reg. H.S. Dist. Bd. of Educ., 5 NJPER 301 (¶ 10162 1979), aff‘d, 176 N.J.Super. 476 (App.Div.1980), certif. den., 87 N.J. 312 (1981); In re Pascack Valley Reg. H.S. Dist. Bd. of Educ., 3 NJPER 114 (1977). But it believed that a narrow exception could be carved out in the field of discrimination because, as PERC put it, “[a] decision to improperly deny an employee an appointment because of race is not one based on a major educational policy and therefore the submission of that single question to an arbitrator could not interfere with the determination of governmental policy.” See Blue Hills Reg. Dist. School Comm. v. Flight, 383 Mass. 642, 421 N.E.2d 755, 757 (1981) (creating an exception to the nondelegability doctrine for impermissible discrimination; arbitrator‘s decision would “not unreasonably trespass on the managerial authority of the employing agency“).
The question cannot be resolved so simply without examining the other side of the coin. Stone Harbor v. Wildwood Local 59,
In evaluating a hiring choice for bias, one must inevitably consider all other factors that motivated the decision. See Texas Dep‘t of Community Affairs v. Burdine, 450 U.S. 248, 101 S.Ct. 1089, 67 L.Ed.2d 207 (1981) (valid nondiscriminatory reason for employment action will rebut prima facie case of discrimination). Though it remains true that there is no managerial prerogative to discriminate, it is equally true that the Legislature has established the State Division on Civil Rights as generally the most appropriate forum for resolving this issue. The reasons that we outlined today in Thornton, 94 N.J. 1, for the paramount jurisdiction of the Division are equally applicable in the public sector and more appropriately applied because of the direct involvement with the governmental function of hiring.
For this reason, we agree with the Appellate Division that the matter may be referred to the Division on Civil Rights for its review and findings. Although the agency‘s review implicates an interference with the inherent managerial prerogatives of the public employer, the interference is mandated to fulfill governmental policy. “Matters of public policy are properly decided, not by negotiation and arbitration, but by the political process.” IFPTE, 88 N.J. at 402. That process has determined
III.
That the ultimate substantive decision on hiring in public employment is not subject to binding arbitration does not mean that grievance of discrimination claims should not be encouraged. To the contrary, we agree with the proposition that grievance procedures will often provide an expedited resolution of discrimination claims and clear the air of much misunderstanding. Such proceedings are less polarized, less public and less bureaucratic in setting than a governmental forum.
Public employees of this State have a constitutional “right to organize [and] present ... grievances and proposals through representatives of their own choosing.”
In the past we have encouraged the establishment of grievance procedures for issues that will not be subject to binding arbitration. Although the scope of arbitrability is limited by the test for negotiability, Ridgefield Park, 78 N.J. at 160
Public employers shall negotiate written policies setting forth grievance procedures by means of which their employees or representatives of employees may appeal the interpretation, application or violation of policies, agreements, and administrative decisions affecting them, provided that such grievance procedures shall be included in any agreement entered into between the public employer and the representative organization.
It does not mandate arbitration as the terminal step of a grievance mechanism or any of the procedural details of the grievance procedure beyond the presentation stage. W. Windsor, 78 N.J. at 108. Moreover, “the scope of grievability is more expansive than the scope of negotiability,” id. at 116-17; the concepts are “not necessarily equal,” id. at 107.
In Bernards, we suggested, in the context of disputes on the withholding of salary increments for inefficiency or other good cause, that parties consider advisory arbitration. We stressed that such a process will have sound and beneficial results.4
Not only is advisory arbitration not detrimental to the public interest, its utilization may well bring about beneficial consequences. The arbitrator‘s findings and conclusions constitute an additional source of information for the Commissioner and will therefore assist him in carrying out his statutory responsibilities. Moreover, this additional source of information—unlike the input from the Board and the Association—will derive from a disinterested observer. The arbitrator‘s advisory recommendation may induce the parties to resolve their dispute without invoking the Commissioner‘s jurisdiction. Finally, we cannot overlook the potential favorable effects that such a procedure will have upon the morale of public employees, inasmuch as they will be permitted to present their cause—even if only as an initial matter—to an individual whom they do not consider aligned in interest with the Board. [Id., 79 N.J. at 325-26].
The parties here did not seek or bargain for advisory arbitration. But there was a complete airing of the grievance at the Board level. These complementary grievance procedures serve the useful statutory purpose of “conference, conciliation and persuasion” mandated by
IV.
Summarizing our holdings in this case and in Thornton, 94 N.J. 1, we hold that (1) grievance procedures in labor agreements that permit employees to present discrimination claims in hiring are important and useful in both public and private employment; (2) in public employment, because of the inherent managerial function implicated in hiring, retaining, or replacing employees, only advisory arbitration of such claims of discrimination in employment is allowed; and (3) in either public or private employment, although of evidential value, neither failure to present nor unsuccessful prior submission of such a claim
The judgment of the Appellate Division is affirmed.
HANDLER, J., concurring in the result.
For affirmance—Chief Justice WILENTZ, and Justices CLIFFORD, SCHREIBER, HANDLER, POLLOCK, O‘HERN and GARIBALDI—7.
For reversal—None.
HANDLER, J., concurring.
I concur in Justice O‘Hern‘s opinion for the majority, but write separately to caution against an overly expansive interpretation of the decision. This case involves a complaint by a teacher regarding promotion and thus implicates the School Board‘s managerial prerogatives. Because a “public employer cannot bargain away the review of a decision whether to hire, promote, or retain teaching staff,” ante at 16, the Board is prohibited from establishing binding arbitration on matters of hiring and promotion. As a result, the complaint of racial discrimination forwarded in this case must be brought before the Division on Civil Rights, which is statutorily authorized to review such disputes.
I wish to emphasize, however, that this analysis would not apply in instances where the discrimination complaint relates to the terms or conditions of employment, rather than an inherent managerial prerogative. Because a school board could validly establish an arbitration mechanism through a collective negotiation agreement to hear these types of job complaints, we would be required to determine the interrelationship between this type of arbitration proceeding and the statutory vehicle established to address violations of the Law Against Discrimination,
We would also need to compare the nature of the rights against discrimination contained in the statute and the employment contract and the remedies available to vindicate these rights. In addition, we would need to determine the manner in which the statutory “policy favoring arbitration of labor disputes and the ... policy against discriminatory employment practices can best be accommodated ...” Thornton v. Potamkin Chevrolet, 94 N.J. 1, 6 (slip op. at 6-7) (1983) (quoting Alexander v. Gardner-Denver, 415 U.S. 36, 59, 94 S.Ct. 1011, 1025, 39 L.Ed.2d 147, 164-65 (1974)). Finally we would need to determine the proper scope of
grievance and disciplinary review procedures may provide for binding arbitration as a means for resolving disputes. The procedures agreed to by the parties may not replace or be inconsistent with any alternate statutory appeal procedure nor may they provide for binding arbitration of disputes involving the discipline of employees with statutory protection under tenure or civil service laws. Grievance and disciplinary review procedures established by agreement between the public employer and the representative organization shall be utilized for any dispute covered by the terms of such agreement.
I do not seek to suggest a particular resolution of this question, but only wish to stress that the matter is left unresolved by the Court‘s opinion. Due to the scope of today‘s decision, the interrelationship between arbitration procedures for the resolution of complaints of discrimination in the terms and conditions