Department of the Auditor General v. Council 13, American Federation of State Employees

CRUMLISH, Jr., President Judge. The Commonwealth, Department of the Auditor General (Auditor General) has filed petitions for review of arbitrators’ decisions reinstating two department employees, Karol — 89 — Danowitz and John Weikel, who were dismissed.1 For the reasons which follow, we affirm the arbitrators’ reinstatement awards. Danowitz was hired as a Clerk I in 1980. Weikel was hired as a clerk in the Files and Records department in 1983. After one month on the job, Weikel, still a probationary employee, was terminated, subsequently reinstated pursuant to an arbitrator’s award and continued working until 1989. On February 1 of that year, both Danowitz and Weikel were instructed to report to the personnel director’s office. Each was then handed a letter signed by the Auditor General terminating them as of 5:00 p.m. that day, based on information gathered by my office as well as through cooperation with other governmental agencies as a result of an investigation into your involvement in a job buying and/or job promotion scheme in the Auditor General’s Office. The “scheme” referred to in the Auditor General’s letter had earlier led to the indictment and guilty plea of Former Auditor General Benedict and the conviction on various charges of his Chief Deputy. Pursuant to Section 903 of the Public Employe Relations Act (PERA), Act of July 23, 1970, P.L. 563, No. 195, as amended, 43 P.S. § 1101.903, and its collective bargaining agreement, respondent Council 13, American Federation of State, County and Municipal Employees (AFSCME), filed grievances of both employees’ terminations. On December 15, 1989, Arbitrator Arvid Anderson upheld AFSCME’s grievance and awarded Weikel’s reinstatement with back pay and interest, upon finding that Weikel had no knowledge of or personal involvement in any job-buying arrange — 90 — ment. He concluded that no just cause existed for Weikel’s termination. On December 27, 1989 Arbitrator Paul Klein upheld AFSCME’s grievance over Danowitz and ordered her reinstatement on essentially the same grounds. Hence, the Auditor General’s petitions were brought to this Court. Section 1501 of PERA, 43 P.S. § 1101.1501. At the outset, we acknowledge that judicial review of an arbitrator’s award under the “essence test” of Community College of Beaver County v. Community College of Beaver County, Society of the Faculty (PSEA/NEA), 473 Pa. 576, 375 A.2d 1267 (1977), is extremely circumscribed. We are limited to determining whether that award “represents a reasonable interpretation of the labor agreement between the parties.” County of Centre v. Musser, 519 Pa. 380, 390, 548 A.2d 1194, 1198 (1988). The Auditor General argues that the award cannot “in any rational way be derived from the [collective bargaining] agreement”, Commonwealth, Pennsylvania Liquor Control Board v. Independent State Stores Union, 520 Pa. 266, 268, 553 A.2d 948, 951 (1989), because it denies the employer control of its work force in an area not covered by the collective bargaining agreement — that of terminating, for non-disciplinary reasons, illegally hired employees. The Auditor General also contends that the award is void as against the public policy declaring the buying and selling of jobs to be illegal, and void and unenforceable because it extends contractual protection to an illegal transaction. Article 29 of the collective bargaining agreement (Agreement) provides: Article 29 Discharge, Demotion, Suspension and Discipline Section 1. The Employer shall not demote, suspend, discharge or take any disciplinary action against the employee without just cause____ — 91 — The Auditor General has, by the terms of the Agreement, limited her powers over personnel actions. Nonetheless, she argues that her termination of these two employees, while certainly a personnel action, is not disciplinary in nature but is designed to remove from the Department employees who had been touched by a job-selling scandal. Thus, she maintains that the arbitrators’ awards fail under the essence test because the Agreement’s just cause provisions do not govern removal in this instance. While it may be so that the Auditor General terminated the employees for reasons other than discipline, her power is limited by the terms of Article 29 to all discharges, not just disciplinary discharges. Nothing in Article 29’s language suggests otherwise. There are no words to suggest that the term “disciplinary action” is inclusive of the other three actions listed — demotion, suspension, discharge. Were the phrase to read "... or take other disciplinary action,” it could be argued that the Auditor General’s power to remove employees was limited by the agreement only to the extent those removals (or demotions and suspensions) were disciplinary. That is not the case, however. Rather, each of those actions could be taken for reasons unrelated to discipline. No matter what the motivation, as Article 29 is plainly read, just cause is the standard for all discharges, and the Auditor General may not effect terminations or the other enumerated personnel actions without just cause. We find nothing manifestly unreasonable in the arbitrators’ interpreting the labor agreement according to this standard. Further, the arbitrators in both cases found that neither employee had knowledge that their respective positions had been bought; the Auditor General admits their lack of knowledge. Therefore, each employee was found to have no involvement in a scheme to buy or sell jobs. The arbitrator also found that each had good job records and received regular, positive evaluations. Because the arbitrators found no just cause for their dismissals, they found the collective bargaining agreement — 92 — had been breached and awarded reinstatement with full back pay. This decision can rationally be derived from the collective bargaining agreement and therefore must be upheld. Independent State Stores Union, Nonetheless, the Auditor General would have us hold that the award is manifestly unreasonable because the Department of the Auditor General, as a governmental agency, cannot bargain away its legal responsibility to insure that its employees or officers do not violate the law in filling positions. We find the cases relied on by the Auditor General inapposite. In Philadelphia Housing Authority v. Union of Security Officers #1, 500 Pa. 213, 455 A.2d 625 (1983), a public housing security officer was reinstated after his termination for fraud and falsification. The Supreme Court overturned the arbitrator’s award as manifestly unreasonable. In County of Centre v. Musser, 519 Pa. 380, 548 A.2d 1194 (1988), an arbitrator’s reinstatement award was again overturned. There, a county corrections unit terminated two employees for continued harassment and abuse of an inmate. Most recently, in Independent State Stores Union, our Supreme Court held an arbitrator’s reinstatement award to be manifestly unreasonable after a Liquor Control Board Store manager was terminated for theft of the store’s proceeds. In each case, however, it was the employee’s conduct which was illegal and directly related to his role in the employing agency’s function. Our Supreme Court noted in Philadelphia Housing, County of Centre and Independent State Stores Union, that a Commonwealth employer was not free to bargain away the right to discharge employees who engage in illegal conduct. Here it was found that the employees neither engaged in any wrongdoing nor knew of that wrongdoing. Each was qualified and received positive job evaluations. There was no “bargaining away” of any obligation to — 93 — terminate employees who had committed work-related crimes. Nor are we persuaded to void the arbitrators’ award as against explicit public policy prohibiting government employee corruption. There is no question that the buying or selling of public jobs is a crime in this Commonwealth. The record indicates, and the Auditor General acknowledges, that employees who personally paid for jobs, or admitted awareness of payments in exchange for jobs were terminated. However, the Commonwealth’s public policy is not offended by the reinstatement of these two employees, who were found to be innocent of any knowledge of criminal behavior or of wrongdoing itself. Unlike in Central Dauphin School District v. American Casualty Company, 493 Pa. 254, 426 A.2d 94 (1981), the agreement herein does not bind the parties to engage in any unlawful conduct. The public policy of eliminating Commonwealth employee corruption is thus not sufficiently served by abrogating the Agreements’ terms, and voiding of arbitrators’ awards. Finally, the Auditor General argues that, because their jobs were illegally given, the employees had no enforceable right which could be upheld in an arbitrator’s award. She maintains that the employees appointments were legal nullities and therefore there is no legally enforceable right which can be vindicated by the arbitrators’ award. Again, we disagree. First, a property right to a benefit such as employment may be created by a statute, regulation or contract. Sasko v. Charleroi Area School District, 121 Pa.Commonwealth Ct. 220, 550 A.2d 296 (1988). Here, as member of the bargaining unit, the employees were certainly parties to the agreement, which no one contends is illegal and which grants them certain enforceable protections. One of those protections requires the employer to find just cause before terminating members of the bargaining unit. — 94 — Second, had there been a contract entered into, either collectively or individually, between these employees and the former Auditor General that required payment of money as an employment condition, that contract would be illegal and void ab initio. Such a contract was not the subject of the arbitrator’s award, however. Here, there was an enforceable contractual right, embodied in the Agreement, to continued employment until such time as there is just cause to dismiss. The arbitrators in both cases adhered to this standard. We find nothing manifestly unreasonable in that interpretation of the Agreement. Accordingly, we shall affirm the awards in each case. ORDER No. 90 C.D.1990 The award of arbitrator Paul E. Klein, dated December 27, 1989, in the above captioned matter is affirmed. ORDER No. 91 C.D.1990 The award of arbitrator Arvid Anderson, dated December 15, 1989, in the above captioned matter is affirmed. Footnotes [1] The Auditor General’s petition for review of the award reinstating Danowitz was docketed in this Court at No. 90 C.D.1990; the petition for review of Weikel’s reinstatement was docketed at No. 91 C.D.1990. Both arbitrators’ awards set forth virtually the same grounds for reinstatement and the statement of questions presented in each petition were identical. Consequently, when practical, we shall hereinafter refer to Danowitz and Weikel as "employees”.