Minnesota Supreme Court Overturns Court of Appeals Decision in City of Richfield v. LELS

Today, the Minnesota Supreme Court rendered its opinion in City of Richfield v. LELS, A17-1275 (Minn. Sup. February 13, 2019). Those who wish to read the decision in its entirety can go here.

We’ve blogged about this issue a couple of times, and now we have the decision.

Two Big Happenings Affecting Public Labor in Minnesota

In Contrast to Richfield Decision, Judge Denies City’s Claim that Reinstatement was Contrary to Public Policy

The Supreme Court reversed a court of appeals decision that had vacated a labor arbitration award, and effectively reinstates the arbitrator’s award, which put Police Officer Nathan Kinsey back to work after a three-day unpaid suspension.  The end result essentially maintains the very scope of “public policy” basis to vacate an arbitration award.

In the case, the city had terminated Kinsey for failing to report his use of force and violating other policies based on his October 3, 2015 interactions with Somali individuals in a city park.   That interaction was videotaped and distributed on the internet.  It showed Officer Kinsey push one individual twice and slap him on the back of the head.  He was also heard using profanity on his body-microphone.  Officer Kinsey never reported his use of force.

After the union grieved the matter, a 5-day arbitration hearing was held.  The arbitrator determined that the officer had not used excessive force, and that his failure to report use of force was a “lapse in judgment.”  The arbitrator determined that the city did not have just cause to terminate the officer, and the award reinstated him to his position with a 3-day suspension for not properly reporting the incident.

In district court and then the court of appeals, the city moved to vacate the arbitration award on the basis that the arbitration award violated public policy.  The city stated that there was a public policy “in favor of police officers demonstrating self-regulation by being transparent and properly reporting use of force.”  In vacating the arbitration award, the court of appeals stated that the “arbitration award interferes with the public policy against officers using excessive force” because reporting was necessary for departments to review use of force incidents to prevent excessive force.

In its analysis, the Court stated the standard for application of the motion to vacate:  “We have noted that a public-policy exception may, in limited circumstances, provide a basis to vacate an arbitration award that violates a well-defined and dominant public policy.”  Courts must look to “existing laws and legal precedents,” not “general considerations of supposed public interests” to use the public policy exception to vacate an arbitration award.

The Court indicated that arbitration awards are provided substantial deference.  It also made a critical distinction, citing its past precedent on the issue: “[a]lthough the public employee’s conduct may have violated a well-defined and dominant public policy, it is another matter to ‘conclude that the arbitrator’s award reinstating [the employee] violates’ a well-defined and dominant public policy.  The Court stated that the focus must be on the effect of enforcement of the arbitrator’s award.

Here, the Court sided with the union’s argument that “the court of appeals focused unduly on Kinsey’s conduct rather than on enforcement of the arbitration award, and reinstatement of Kinsey does not violate any public policy.”

In reaching its decision, the Court said it would be “difficult” to find a public policy violation given the finding that excessive force was not used.  The Court also found the city’s policy on reporting force “was not clear.”  It determined “(t)he factual findings of the arbitrator, findings that we give deference to, do not support overturning the arbitration award on the basis of a rarely used public-policy exception.”  The Court also noted that state statute and the parties’ labor contract required arbitration, and that the arbitrator determines whether just cause exists.

So what does it mean going forward?  Based on the Supreme Court’s holding, the public policy basis for challenging an arbitrator’s award will remain quite narrow.  An arbitration award, and the effect of its enforcement, must run afoul of a “well-defined and dominant public policy” to be overturned through a motion to vacate.  In Minnesota, that will remain a rare case indeed.  (There has been only one court of appeals decision that vacated an arbitration award, predicated on egregious and repeated sexual harassment by the employee).

Another way to view this case is that an arbitrator’s award, with the factual conclusions and determination of whether just cause exists, will continue to receive substantial deference in the courts of Minnesota.  Accordingly, your labor arbitration case, except in the most unusual circumstances, will be decided by an arbitrator’s award.  So get expert advice and representation during the course of your labor arbitration process, expertise that the Wiley Law Office provides.

On a grander scale, your jurisdiction should be looking at this issue when bargaining its contracts.  If there are matters such as violation of policy that you would like to constitute “just cause” in every case, make sure your policy is clear, and make sure those standards are agreed to in collective bargaining, either in a contract, MOU, or other unmistakable agreement.  We can help you with that negotiation process as well.

As always, we at Wiley Law remain available to consult on this case and its effect on your on-going labor issues.  Contact us for advice that works.