HARRISBURG – The Commonwealth Court of Pennsylvania recently reversed a trial court order that denied a former borough police chief the ability to challenge the refusal of his disability pension through arbitration.

On Jan. 4, the Court issued a determination of a three-judge panel in the instant case, authored by Commonwealth Court Judge Patricia A. McCullough.

Plaintiff Timothy A. Delaney was Coaldale Borough’s Police Chief and was injured while testing a taser in August 2013. He later filed a request with the Police Pension Board for a disability pension in June 2015.

“By decision dated May 23, 2016, the Board denied Delaney’s request and informed him of his right to appeal within 30 days. Rather than appeal, Delaney filed a grievance on June 7, 2016, alleging that the denial of his disability pension was in violation of his Employment Agreement with the Borough,” McCullough wrote.

Under the terms of the Employment Agreement, Delaney participated in the Borough’s Police Pension Fund, with Article XIV of the Employment Agreement providing for a grievance and arbitration procedure to resolve all disputes arising between Delaney and the Borough. Counsel for Delaney later sent a letter to the Borough, requesting that the parties bypass the grievance procedure and proceed directly to arbitration.

But the Borough filed a petition with the Schuylkill County Court of Common Pleas to quash Delaney’s arbitration request on Dec. 30, 2016 – acknowledging the Employment Agreement as well as a local ordinance adopting the Borough’s Police Pension Plan – but still arguing the Board was a local agency, operating in accordance with its Police Pension Plan and the Local Agency Law. 

The Board convened a hearing and issued a written decision, and that Delaney’s sole remedy was to file an appeal with the appropriate court, i.e., the trial court, within 30 days of the Board’s decision in accordance with the Local Agency Law.

On April 26, the Board denied Delaney’s petition and concluded his exclusive remedy for the denial of his disability pension was to appeal the Board’s determination within 30 days pursuant to the Local Agency Law. An appeal to the trial court was unsuccessful, leading Delaney to later seek relief with the Commonwealth Court.

Delaney pointed towards the Supreme Court of Pennsylvania’s reversal of the City of Arnold v. Wage Policy Committee of the City of Arnold Police Department decision in pleading his case to the Commonwealth Court.

In City of Arnold, Thomas Cimino died in April 2002, after serving as a City of Arnold police officer for more than 11 years. In May 2002, the City’s Controller informed his widow, Pamela Cimino (Widow), that she was entitled to a death/survivor benefit of $1,949.11 per month, which was 50 percent of Thomas’s annual compensation at the time of his death.

In 2014, the City’s police pension board advised Widow that her benefit had been miscalculated; that she was only entitled to 50 percent of the monthly benefit, or $974.55 per month, and that she received an overpayment of $138,386.10 as a result of the miscalculation. Further, that it would deduct $10.00 per month from her future benefit payments to recoup said overpayment.

“The police officers’ bargaining representative grieved the action on Widow’s behalf pursuant to the CBA and the matter was submitted to an arbitrator. The arbitrator ultimately sustained the grievance. The City’s police pension board filed a petition to vacate the arbitrator’s award with the common pleas court, but said petition was denied,” McCullough said.

The City’s police pension board then appealed to the Commonwealth Court.

“By decision and order dated May 20, 2016, we reversed the trial court’s order, concluding that Widow’s right to a survivor benefit was ‘not derivative of [her late husband’s] rights under the CBA, but an independent right under the City’s pension plan.’ We held that, as the matter involved a decision of the City’s police pension board, a local agency subject to the provisions of the Local Agency Law, the arbitrator lacked subject matter jurisdiction over the dispute and the common pleas court erred in failing to vacate the arbitration award,” McCullough stated.

Ultimately, the Supreme Court decided the arbitrator had subject matter jurisdiction to settle the dispute between the police officers’ bargaining representative and the City, because the survivor benefit afforded to Widow, as a surviving spouse of a deceased police officer, was included into the parties’ CBA.

“The Borough attempts to distinguish City of Arnold from the present case by noting that the former involved a unilateral determination by the city, not the local pension board, to reduce Widow’s benefits, and there was no opportunity afforded Widow to contest the city’s decision, let alone any adjudication in that case. Because Delaney sought and obtained an adjudication from the Police Pension Board, the Borough asserts that he waived any jurisdiction the arbitrator may have otherwise had to resolve the dispute and was limited to the exclusive remedy of an appeal under the Local Agency Law,” McCullough said.

McCullough stated that “the Board’s decision denying Delaney a disability pension” was the trigger event in this case and clarified the precedent set in City of Arnold.

“Our Supreme Court’s focus in City of Arnold was Widow’s right to a survivor’s benefit being derivative of her late spouse’s rights under the CBA in that case. In other words, the Supreme Court concluded that Widow’s right to survivor benefits was incorporated into that CBA, stressing that a pension benefit was a specific term or condition of employment arising from her late spouse’s employment as a city police officer,” McCullough explained.

McCullough cited both a 2004 borough ordinance which “established a police pension plan for police employees who are discharged by reason of age or a service disability”, in addition to Delaney’s Employment Agreement with the Borough, which “includes Delaney’s right to participate in, and to be entitled to benefits from, the police pension plan.”

“The Employment Agreement entered into by Delaney and the Borough is similar to the CBA in City of Arnold, as both set forth a pension benefit for eligible employees and both direct that any matters thereunder be submitted to a grievance and arbitration procedure. Moreover, Delaney’s right to pension disability benefits, much like Widow’s right to survivor benefits in City of Arnold, is plainly derivative of this Employment Agreement,” McCullough said.

“Because our Supreme Court’s decision in City of Arnold is controlling herein, thereby rendering the matter of Delaney’s service-related disability pension arbitrable, the trial court erred in granting the Borough’s petition to quash Delaney’s request for arbitration. Accordingly, the order of the trial court is reversed,” McCullough concluded.

Commonwealth Court of Pennsylvania case 674 C.D. 2017

From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nickpennrecord@gmail.com

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