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decided: July 13, 1982.


Appeal from the Order of the Court of Common Pleas of Erie County in case of In the Matter of the Arbitration Between The School District of the City of Erie and The Erie Education Association, No. 912-A-1981.


George Levin, for appellant.

John W. Beatty, for appellee.

President Judge Crumlish and Judges Craig and Doyle, sitting as a panel of three. Opinion by Judge Craig. President Judge Crumlish, Jr. concurs in the result only.

Author: Craig

[ 67 Pa. Commw. Page 384]

In this labor arbitration appeal, the Erie Education Association questions an order by the Court of Common Pleas of Erie County reversing an arbitrator's decision that a revision of the sabbatical leave policy of the Erie School District had violated its collective

[ 67 Pa. Commw. Page 385]

    bargaining agreement with the association. The reversal was on the basis that the decision "could not have been drawn from the essence" of the contract.

We reverse.

In its only reference to sabbatical leaves, the contract, which was effective from July 1, 1978 through June 30, 1980, stated:

Sabbatical leaves shall be granted to teachers in accordance with the School Code, Article XI, F. Sections 1166, 1167, 1168, 1169, 1170, 1171.*fn1

Since 1937, the district had used a sabbatical leave plan for professional employees which imposed certain conditions and restrictions on the granting of approved leaves.*fn2 In March of 1980, before the expiration of the contract, the district amended the plan without negotiation, apparently promulgating more restrictive regulations and limiting the number of sabbatical leaves which could be granted in a school year.*fn3

Following the association's unfair labor practice charge in May of 1980, alleging that the district violated

[ 67 Pa. Commw. Page 386]

    the Public Employee Relations Act*fn4 by unilaterally revising the regulations governing sabbatical leave, the Pennsylvania Labor Relations Board ordered the matter referred to arbitration through the grievance procedure outlined in the contract.

The arbitrator framed the issue as "whether the change in the administration of the sabbatical leave policy is in violation of the collective bargaining agreement."

After comprehensively reviewing the parties' positions, the evidence, and all the sections of the School Code cross-referenced by the contract, the arbitrator held that, once the bargaining had closed on the agreement, the district was no longer free to withdraw existing benefits, stating:

[Management] has an implied obligation to maintain [existing benefits] including those benefits which were not revoked . . . during negotiations and to which the contract makes no reference. . . . The Association signed the collective bargaining agreement . . . with the understanding that the sabbatical leave plan, which was in effect at the time the parties negotiated, would remain in effect.

[ 67 Pa. Commw. Page 387]

The common pleas court held that the association had bargained away the right to limit the district's power to alter the leave policy, stating that "the authority to promulgate additional regulations regarding sabbaticals is expressly delegated to the school directors by Section 1171 (of the School Code) and this delegation is expressly contained in Paragraph K of the bargaining agreement."

Concluding that the arbitrator had ignored the clear language of the contract and impermissibly looked behind its terms, the court reversed.

Under Leechburg Area School District v. Dale, 492 Pa. 515, 424 A.2d 1309 (1981), judicial review of an arbitrator's decision is limited by the "essence test," requiring "a determination as to whether the terms of the agreement encompass the subject matter of the dispute." 492 Pa. at 521, 424 A.2d at 1312.

The district contends that the essence test has been superseded by enactment of the Pennsylvania Uniform Arbitration Act,*fn5 and that Section 7302(d)(2) outlines the applicable judicial review of arbitration awards:

(d) Special Application. --

(1) Paragraph (2) shall be applicable where:

(i) The Commonwealth government submits a controversy to arbitration.

(ii) A political subdivision submits a controversy with an employee or a representative of employees to arbitration.

(iii) Any person has been required by law to submit or to agree to submit a controversy to arbitration pursuant to this subchapter.

(2) Where this paragraph is applicable a court in reviewing an arbitration award pursuant

[ 67 Pa. Commw. Page 388]

    to this subchapter shall, notwithstanding any other provision of this subchapter, modify or correct the award where the award is contrary to law and is such that had it been a verdict of a jury the court would have entered a different judgment or a judgment notwithstanding the verdict.

However, as noted in a very useful recent commentary on the issue, Sherman, Analysis of Pennsylvania's Arbitration Act of 1980,*fn6 the substance of subsection (d)(2) was derived from section 11(d) of the original arbitration act of 1927.*fn7 Two cases interpreting the effect of the act on the scope of review, Port Authority of Allegheny County v. Amalgamated Transit Union, 492 Pa. 494, 424 A.2d 1299 (1981), and Community College of Beaver County v. Community College of Beaver County, Society of the Faculty, 473 Pa. 576, 375 A.2d 1267 (1977), established that the standards of judicial review contained in the 1927 act and those of federal decisional law are not significantly different:

[ 67 Pa. Commw. Page 389]

Under our prior interpretations of ยง 11(d) of [the 1927] act, we must respect the award of the arbitration panel, including its definition of its own jurisdiction, so long as it is "in any rational way . . . derived from the [collective bargaining] agreement . . ."

Port Authority of Allegheny County at 497, 424 A.2d at 1300.*fn8 Thus, we agree with Professor Sherman's conclusion that:

[T]he trend under the 1927 act was for the Supreme Court of Pennsylvania to use a standard of judicial review for labor arbitration awards which was not greatly dissimilar from that which would apply if the 1927 act were not applicable. For this reason, even if subsection (d)(2) of the new arbitration act is applied to labor

[ 67 Pa. Commw. Page 390]

    arbitration awards rendered for political subdivisions under Act 195, the result may not be greatly different from that which would be reached if subsection (d)(2) of the new arbitration act is deemed to be inapplicable to such awards.

Finding no bar to application of the standards of review outlined in Leechburg, we must examine the contract terms to determine if the dispute was arbitrable.

The question of whether an issue is a proper subject for arbitration -- and thus within the jurisdiction of an arbitrator -- is usually answered by the terms of the agreement, Port Authority of Allegheny County. However, that determination was made more difficult here by the ambiguous nature of the contract reference to sabbatical leave, that it "be granted . . . in accordance with the School Code. . . ."

The arbitrator was first faced with answering the threshold question of whether the cross-reference to the School Code displaced the previous pattern with respect to sabbatical leaves, subjecting the leave policy solely to the statutory authority of the school board, or whether the contract provision implicitly incorporated the prevailing practice as an enlargement of the terms intended to govern leave policy as a bargained item. See County of Allegheny v. Allegheny County Prison Employees Independent Union, 476 Pa. 27, 39, 381 A.2d 849, 855 (1977); School District of Pittsburgh v. Local Union 297, 46 Pa. Commonwealth Ct. 192, 407 A.2d 67 (1979).*fn9

[ 67 Pa. Commw. Page 391]

In answering that pivotal question of interpretation, the arbitrator resolved the threshold issue of arbitrability by determining that the sabbatical leave policy was subsumed within the contract agreement terms and was therefore arbitrable.

The district contends that the contract cross-reference to Section 1171 of the School Code, which gives the board of school directors the right to "make such regulations as they may deem necessary to make sure that employees on leave shall utilize such leave properly for the purpose for which it was granted . . .," indicates that the district retained the right to promulgate regulations at any time during the contract term.

We cannot agree.

The power to make regulations pertaining to leave policy is not tantamount to a statutory declaration that the area is removed from bargaining; the parties to a contract may agree to restrict or allow negotiation over matters which the statute designates as within school board power. Indeed, any collective bargaining by a public agency must necessarily involve matters committed by law to the agency's powers; only when the statute mandates exclusivity in exercise of the function would it be withdrawn by law from collective bargaining.

Our Supreme Court recently reaffirmed the policy of "broad judicial deference . . . to arbitrator's determinations regarding the arbitrability of the subject matter of a grievance" in Scranton Federation of Teachers, Local 11147, AFT v. Scranton School District, (No. 413 January Term, 1979, filed April 19, 1982).

This court has followed that doctrine, holding that we must "respect . . . the arbitrator's definition of his own jurisdiction, provided it is rationally derived from the collective bargaining agreement in light of its language, context or other indicia of the parties'

[ 67 Pa. Commw. Page 392]

    intention." West Jefferson Hills School District v. Jefferson Federation of Teachers, 61 Pa. Commonwealth Ct. 374, 433 A.2d 643 (1981), citing Port Authority of Allegheny County.

Hence, we can assign no error to the arbitrator's determination that the sabbatical leave policy was encompassed within the terms of the agreement. Pursuant to our reaching of that conclusion, Leechburg tells us that when, following the essence test, "it is determined that the subject matter of the dispute is encompassed within the terms of the agreement, the validity of the arbitrator's interpretation is not a matter of concern to the court." 492 Pa. at 521, 424 A.2d at 1312.

The origin of judicial deference to the arbitrator's interpretation, as well as to his determination of arbitrability, was outlined by the United States Supreme Court in United Steelworkers v. Enterprise Wheel & Car Corp., 363 U.S. 593, 80 S.Ct. 1358 (1960):

It is the arbitrator's construction which was bargained for, and so far as the arbitrator's decision concerns the construction of the contract, the courts have no business overruling him because their interpretation of the contract is different from his.

363 U.S. at 599, 80 S.Ct. at 1362.

Accordingly, we reverse the order of the common pleas court and reinstate the arbitrator's decision.


Now, July 13, 1982, the order of the Court of Common Pleas of Erie County, No. 912-A-1981, dated July 20, 1981, is reversed, and the decision of the arbitrator is reinstated.

President Judge Crumlish, Jr. concurs in the result only.


Reversed. Arbitration award reinstated.

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