2004 NAC 101 San Bernardino Public Employees Association and Superior Court of California San Bernardino County

Title: San Bernardino Public Employees Association and Superior Court of California San Bernardino County
Date: June 30, 2003
Arbitrator: Allen Pool
Citation: 2004 NAC 102

This Arbitration arose pursuant to Agreement between the San Bernardino Public Employees Association, hereinafter referred to as the “Association”, and the Superior Court of California County of San Bernardino, hereinafter referred to as the “Court”, under which C. ALLEN POOL was selected by the parties to serve as the Arbitrator. The Parties stipulated that the matter was properly before the Arbitrator and that his decision shall be final and binding.

The hearing was held in the City of San Bernardino on October 21, 2003 at which time the parties were afforded the opportunity, of which they availed themselves, to examine and cross-examine witnesses and to introduce relevant evidence, exhibits, and argument. The witnesses were duly sworn and no transcript was made of the hearing. Written closing arguments were timely received and then exchanged between the parties via the Arbitrator on November 29, 2003 at which time the record was closed.

Whether the Court violated the “Tuition Reimbursement and Membership Dues” article of the Memorandum of Understanding (MOU) by its denial of CCRA and/or COCRA reimbursement requests by Grievants Laura Echols, Peggy Ogaz, and Leisha Hendrix; and if so, what shall be the remedy?

In conjunction with SBPEA, the Court has established for each representation unit a tuition reimbursement and membership dues procedure to encourage all employees to purse educational opportunities and involvement in organizations to enhance their contribution as Court employees and assist in their career development. Both parties recognize the importance of continued quality improvement and strongly encourage the utilization of opportunities assisted by this Article. Tuition funding and reimbursement programs shall be administered by the Court Personnel Manager.

No Unit member shall receive tuition reimbursement in excess of the limitation determined by the Internal Revenue Service. Eligibility for reimbursement is contingent upon an approved course or seminar, completed with, where applicable, a grade of “C” or better or “pass” when taken on a pass/fail basis, except in extenuating circumstances where such a situation as verifiable illness prevents an individual from completing a course.

The Court will establish a fund of $10,000 on each July 1 and January 1 for use by employees in a regular position in the Support Services and Supervisory Units with a least twelve (12) months of Court service. This fund will be administered by the Court Personnel Unit and will be available for use on a first-come, first-served basis for 100% reimbursement of tuition and community college registration fees for career development courses or to reimburse membership dues in professional organizations; provided such expenditure enhances furtherance of Court goals and is previously approved by the Court Personnel Unit.

The Court agrees to budget five hundred dollars ($500.00) each fiscal year for each employee in a regular position budgeted more than forty (40) hours per pay period to reimburse employees for tuition costs incurred for job-related education or career development or for the payment of membership dues in professional organization(s); providing such expenditure enhances furtherance of Court or continuing education goals. Approved memberships may be paid for directly by the Court at the employee’s request or the employee may be reimbursed.

Requests for such reimbursement must be approved in advance by the Court Personnel Manager or designee and shall not be paid increments less than ten dollars ($10.00) per fiscal year.

The Court agrees to budget five hundred dollars ($500.00) each fiscal year, for each employee in a regular position budgeted more than forty (40) hours per pay period to reimburse employees for tuition costs incurred for job-related education or career development or to reimburse membership dues in professional organization(s); provided such expenditure enhances furtherance of Court or continuing education goals.

The Court agrees to reimburse employees for required certificates and the mandatory portion of State Bar dues.

Request for reimbursement must be approved in advance by the Court Executive Officer or designee and shall not be paid in increments less than 10 dollars ($10.00) per fiscal year. Employee initiated education or career development shall not be considered as time actually worked for purposes of computing overtime and normally shall not occur during regular work hours except that which has prior approval of the Court Executive Officer or designee.

            The backdrop against which the dispute in this matter evolved and which led to this arbitration was California’s budget crisis of the Fiscal Year 2002-2003. As was well known, the budget crisis had a significant impact on the entire State including the California State Court System of which the San Bernardino County Superior Court is a part and was not immune to the effects of the crisis. Specifically, the crisis prompted efforts by the state court system to find ways to conserve resources and to increase revenues for the remainder of FY 2002-03 and for FY 2003-04.
            In January of 2003, the State Judicial Council under the leadership of the Chief Justice of the Supreme Court put forth several recommendations for conserving resources and increasing revenues for remainder of FY 2002-03 and for FY 2003-04. Included were two recommendations that figured prominently in the instant case. One was a proposal for legislation that would allow the state court system greater use of electronic recording of trial court proceedings. According to the Council, the estimated saving would amount to $36.5 million dollars. The second was a recommendation for legislation that would give the trial courts ownership of court reporting transcripts/transcriptions. The estimated saving was placed at $5.5 million dollars.
            Both the California Court Reporters Association (CCRA) and the California Official Court Reporters Association (COCRA) came out in opposition to the Judicial Council’s recommendations.   Both organizations also actively lobbied the state legislature against the enactment of Judicial Council’s recommendations for legislation allowing greater use of electronic recording of court proceedings and for trial court ownership of court reporting transcripts/transcriptions. In May of 2003, the Judicial Council’s proposals were defeated in the Assembly’s Budget Committee, the Assembly, and in the Senate.
            Sometime in February of 2003 the San Bernardino County Superior Court became aware of the lobbying efforts of the CCRA and the COCRA to defeat passage of the Judicial Council’s proposals concerning electronic recording and ownership of transcripts. The Court’s Chief Executive Officer, acting on the belief that tuition and dues money from the two organizations was being used for purposes that did not further the interests of the Courts goals, began denying reimbursement applications for organizational dues and for tuition costs of seminars/workshops sponsored by the two organizations.
            On February 26, 2003 Peggy Ogaz applied for reimbursement for dues paid to CCRA, $125.00. Her application was denied. At the same time, Ms. Ogaz also applied for reimbursement of the tuition costs for two seminars sponsored by CCRA, $118.00. Those applications were also denied (Jt-2)[1].
            On February 13, 2003, Laura Echols applied for reimbursement of dues paid to CCRA, $125.00. On March 5, 2003, Ms. Echols was notified that her application not approved. The reason given was the Court’s belief that membership dues for CCRA included money for political activities (Jt-3).
           On May 6, 2003, Leisha Hendrix applied for reimbursement of membership dues paid to CCRA ($125.00) and to COCRA ($85.00). Both applications for reimbursement were not approved. The first was not approved on July 3, 2003. The reason given was “Organization dues support professional lobbying”. The second was not approved on June 3, 2003. The reason given was “Lobbying activities supported” (Jt-1). Grievances were filed by the three unit members Ms. Ogaz, Ms. Echols, and Ms. Hendrix and were processed to this arbitration.

            The Court violated the Tuition and Membership Dues Reimbursement article of the MOU when it denied reimbursement of tuition and or membership dues for the Court Reporters, i.e. Laura Echols, Peggy Ogaz, and Leisha Hendrix. The Court violated the application and intent of the language in the article. Both the California Court Reporters Association (CCRA) and the California Official Court Reporters Association (COCRA) are professional organizations with the goal of improving and assisting court reporters in their career development. The language of the MOU strongly encourages employees to utilize the assisted opportunities and to pursue involvement in organizations that enhance their contributions to the Court as employees and assist in their career employment.
            The MOU has no criteria for denial of tuition or dues reimbursement based on political activities. The Court was not concerned with the political activities of CCRA and COCRA until legislation was proposed in early 2003 calling for the expanded use of Electronic Recording in trial courts and the a change in ownership of transcripts.
            The grievance should be sustained and Court should be ordered to immediately reimburse tuition fees and membership dues to the grievants and any and all other reimbursements requested by court reporters submitted prior to this arbitration award.

The Court did not violate the Tuition Reimbursement and Membership Dues article of the MOU with its denial of CCRA and/or COCRA reimbursement requests by grievants Laura Echols, Peggy Ogaz, and Leisha Hendrix. The language of the MOU is plain and the intent is obvious. The Court has wide and broad discretion in determining whether to approve or not to approve requests for reimbursement of tuition and membership dues. The language allows the Court to unilaterally deny reimbursement if the requested expenditure does not further Court goals. Reimbursement is allowed only if the “expenditure enhances furtherance of Court Coals”.
The Grievants requested reimbursement for expenditures to organizations that actually opposed court fiscal goals. The goals of CCRA and COCRA are in direct conflict with the Court’s goals. They aggressively opposed the Court’s interest in alleviating the State’s funding reduction via the expanded use of Electronic Recording and ownership of transcripts. The Court did not abuse its discretion. The Court reasonably denied the Grievants requests for reimbursement of expenditures to support the lobbying activities of CCRA and COCRA. The Grievance should be denied.

            The focus of this case was the application and intent of the MOU’s article relating to reimbursement of tuition fees and organizational dues. The article was only one of many included in their first MOU, a four-year agreement reached in March 2001. It should be noted that this was a time before the emergence of California’s budget crisis which served as a backdrop in this dispute.
            Collective bargaining agreements like other contracts are never complete. Unfortunately, gaps are frequently present. Because of this, application of the terms of the agreement necessitates good faith efforts on the part of both parties in carrying out the terms of the agreement.   Normally, when there are disputes concerning application or the intent of the parties, the disputes are resolved through continued negotiations, a product of the grievance procedure. Sometimes, though, the parties, unable to reach a negotiated resolution concerning the application and/or intent of the language, turn to arbitration to bring closure to the matter.
            In determining the intent of the parties, it is often necessary to look at the circumstances prevalent at the time the language was written. In this instance, some of the circumstances were obvious. For one, the agreed upon language was a clear recognition by the Court of the worth and value of the Court’s employees. This recognition led to the willingness of the Court to take an active role in fostering the continuing education and career development of its employees.
            The agreed upon language also clearly pointed to its primary purpose; that was, to encourage Court’s employees to take advantage of continuing educational opportunities and to become involved in professional organizations. The Court, in conjunction with Union, agreed to provide financial assistance to its employees through establishment of a fund for reimbursement of tuition fees and dues which would act as an incentive. With respect to members of the Support and Supervisory Unit, the financial support was substantial. The Court agreed to put into a fund the sum of $10,000 on each July 1^st. and January 1^st(Jt-4, p.52).
            With respect to reimbursement of fees, the Court agreed to expend money from the fund to reimburse employees for community college tuition and registration fees for courses taken and completed with a minimum grade, etc. The Court also agreed to expend money for fees associated with work related seminars. With respect to dues, the Court agreed to expend money from the fund to reimburse employees for membership dues paid to professional organizations.
            The language of the article did not include a list of approved courses or seminars. The language did include a requirement that reimbursement was contingent prior approval of the course or the seminar by the Court’s Personnel Unit. The reason was obvious. The Court would only approve courses or seminars whose content was obviously related to an employee’s job.
            Approval or non approval be would be determined on a case-by-case basis. This was a direct and reasonable control by the Court to insure that the content of a course and of a seminar would be work related. It stands to reason, therefore, the Court, for example, would likely not approve reimbursement for a course in pottery or woodworking. Approval would be granted if the content of course or seminar was within the concept and framework of continuing education.
            The language of the article did not name any professional organizations for which the Court would or would not expend money from the fund for reimbursement of dues. The absence was conspicuous and allows the Court another means of exercising reasonable control over the expenditure of funds. Common sense would be that reimbursement of dues would be limited to membership in work related professional organizations. (For example, membership in the National Audubon Society would hardly qualify.)
            The evidence record showed that there was in existence at the time, Spring 2001, several professional organizations acceptable to the Court. Included were the two organizations featured in this arbitration, the CCRA and the COCRA. According to the agreed to language the Court was obligated to and did strongly encourage its employees to become involved in these two professional organizations for the reason that involvement would enhance their career development and contribute to their effectiveness as employees of the Court.
            The language of the article made it clear that not every employee would be entitled to reimbursement of tuition fees and dues. The eligibility requirements were clearly stated. To be a recipient, an employee must be in a regular position and have been an employee of the Court for at lease twelve (12) months. Finally, the language included the criterion that employees would be reimbursed “provided such expenditure enhances the furtherance of Court goals”.
            The language of the article did not specify the Court’s goals. It was obvious, though, that at the time the article was written, it was a goal of the Court to encourage it’s employees to participate in some type of work related continuing career improvement program by taking courses, attending, seminars, and involvement in a professional organization.   It was also a goal of the Court to financially assist the employees in these endeavors. Beyond that, the evidence record was void of any mention of other known or obvious Court goals at the time the parties agreed to the language of the article in question.
            The Court argued that the phrase “provided such expenditure enhances the furtherance of Court goals” was an acknowledgement of the Court’s broad discretion in approving or not approving applications for reimbursement. The Court was correct. It does have broad discretion. The key question is whether that discretion is boundless or are there some restrictions, limits on the Court’s discretion to prevent abuse? The answer is yes. There are limits.
            Arbitrators routinely give deference to an employer’s authority to exercise discretion in a case such as this. However, arbitrators routinely rule that an employer’s use of such discretion will not be upheld if the employer acted in a manner that was unreasonable, arbitrary, or capricious. In this instance, the Court contended there was no abuse of power and that it was reasonable to deny the three grievants applications for reimbursement of tuition fees and dues.   The reason given was because the two professional organizations, CCRA and COCRA had engaged in political lobbying activities that did not further the goals of the Court.
            Determining the intent of the parties can be complicated at times. Such was the case in this instance. The arbitrator was expected to divine the intent of the parties when reality was that the parties never contemplated the particular issue that arose. Up until February 2002, the Court did not concern itself with the political activities of the CCRA and the COCRA. The Court began to deny reimbursement applications where CCRA and COCRA were involved only after the Court learned that the organizations were in opposition to and were actively lobbying the legislature to defeat the Judicial Council’s recommendation for legislation to allow expanded use of Electronic Recordings in trial courts and for a change in ownership of transcripts.
            At the time the parties agreed to their MOU, March 2001, both the CCRA and the COCRA had a known history of opposing and lobbying against legislation that would, in its opinion, adversely affect their membership. Over the past several years, since 1980, eleven bills were submitted to the legislature to permit expanded the use of Electronic Recording in the trial courts. In each instance, both or one of the organizations lobbied aggressively to defeat the bills. They were successful in every instance (E-3, p.1). The point is that the organizations had a track record showing aggressive lobbying activities where the proposed legislation was deemed to be undesirable to its membership. This had to have been known to the Court at the time the MOU and the language of article in question were agreed upon. Apparently the Court was not uncomfortable at the time with the political activities of CCRA and COCRA. If the Court had real concerns at the time, language addressing the matter could have been included in the article.
            The Court also made a distinction between different methods of political lobbying. The Court’s Deputy Chief Executive Officer, during direct and cross examination, testified that applications for reimbursement for dues in another professional organization, the California Court Clerks Association (CCA) were still being approved. The Deputy’s testimony was that the CCA does not oppose recommended legislation that it only responds to enacted legislation. However, the literature of the CCA clearly states that it will, on behalf of its members, take positions on pending legislation and actively oppose what is considered to be undesirable legislation (A-1, p2, A-2, p. 1, A-3, p. 6). When this was pointed out, the Deputy’s response was that CCA members lobby and that the CCA does not hire professional lobbyists to work against the interests of the Court. The conclusion to be drawn was that the Court was being selective in its choice of proposed legislation to be a basis for not approving reimbursement applications.
            The act of CCRA and COCRA hiring professional lobbyists was of real concern to the Court. The act was spoken of at least twice during testimony by the Deputy CEO. The Court illustrated its concern by putting into evidence a page from the COCRA website showing the pictures and résumés the two hired lobbyists (E-8). This was obviously a significant factor in the Deputy’s decision to not approve the applications for reimbursement. The conclusion to be drawn was that political lobbying by an organization’s members would be permissible to the Court but lobbying with hired professionals was not permissible. For the Court to condone one method and not the other was not reasonable. It was arbitrary and an abuse of power.
            A pivotal question was whether the Court acted unreasonably when it unilaterally changed the terms of the agreement and decided to deny applications for reimbursement for reasons not related to the continuing education and career enhancement goals expressed in the agreed to language of the article in question. Yes, it was unreasonable and arbitrary. The Court was not concerned with the political actions of the CCRA and the COCRA at the time the MOU was agreed to in March 2001. However, the Court later became concerned and viewed political lobbying as a problem as of February 2002. Since this was an issue not contemplated in March 2001, a better approach for the Court would have been to return to the bargaining table.
            For the reasons discussed in the above, the decision of the Arbitrator is that the Court violated the “Tuition Reimbursement and Membership Dues” article of the Memorandum of Understanding by its denial of CCRA and/or COCRA reimbursement requests by Grievants Laura Echols, Peggy Ogaz, and Leisha Hendrix. The Grievance is sustained.

The Grievance is sustained. The Court violated the “Tuition Reimbursement and Membership Dues” article of the Memorandum of Understanding by its denial of CCRA and/or COCRA reimbursement requests by Grievants Laura Echols, Peggy Ogaz, and Leisha Hendrix.

The Court is ordered to immediately reimburse tuition fees and membership dues to the Grievants and any and all other like reimbursements requested by court reporters submitted prior to this Arbitration Award.

The Arbitrator retains jurisdiction in this matter to resolve any dispute that may arise in implementing the remedy.

[1] Joint Exhibits are referenced as Jt-1, J-2 p #, etc. Association exhibits are referenced as A-1, A-2, etc. Court (employer) exhibits are referenced as E-1, E-2, etc.