WATCHUNG HILLS REGIONAL EDUCATION ASSOCIATON VS. BOARD OF EDUCATION OF WATCHUNG HILLS REGIONAL HIGH SCHOOL (L-1154-18, SOMERSET COUNTY AND STATEWIDE) ( 2020 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-3574-18T2
WATCHUNG HILLS REGIONAL
EDUCATION ASSOCIATION,
Plaintiff-Appellant,
v.
BOARD OF EDUCATION OF
WATCHUNG HILLS REGIONAL
HIGH SCHOOL,
Defendant-Respondent.
_____________________________
Argued March 2, 2020 – Decided April 13, 2020
Before Judges Fasciale and Mitterhoff.
On appeal from the Superior Court of New Jersey,
Law Division, Somerset County, Docket No. L-1154-
18.
William P. Hannan, II argued the cause for appellant
(Oxfeld Cohen PC, attorneys; Sanford R. Oxfeld, of
counsel; William P. Hannan, II, of counsel and on the
brief).
Marc Howard Zitomer argued the cause for respondent
(Schenck Price Smith & King, LLP, attorneys; Marc
Howard Zitomer, of counsel and on the brief).
PER CURIAM
Defendant Board of Education of Watchung Hills Regional High School
(the Board) employed Robert Myers (the employee) as a part-time bus driver.
The Board and plaintiff Watchung Hills Regional Education Association (the
Association) were subject to a Collective Negotiations Agreement (CNA),
pertaining to the employee's employment and termination. The employee also
had an individual employment contract with the Board. The CNA and the
individual contract (the contracts) conflicted on permissible reasons for
terminating the employee and the available steps to challenge a termination.
The individual contract gave the Board the right to terminate the
employee without any reason on thirty-days' notice, and it did not establish a
grievance procedure to challenge such a termination. The CNA, however,
gave the Board the right to terminate the employee only for good and just
cause, and unlike the individual contract, it outlined grievance steps an
employee must follow to challenge a termination. The Board relied on the
contracts and terminated the employee for completely inconsistent reasons.
On the one hand, the Board terminated him under the no-reason provision of
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the individual contract. On the other hand, the Board terminated him for cause
under the CNA.
The employee challenged the termination for cause by correctly
following the CNA's grievance procedure. The grievance proceeded to
arbitration, where the arbitrator took testimony from numerous witnesses about
whether the Board had good cause to terminate the employee. However,
instead of resolving the good-cause dispute, and relying solely on the CNA's
language in Step Five of its grievance procedure—which says no-reason
terminations are not arbitrable—he dismissed the arbitration. The arbitrator
did not resolve whether the Board had good cause, although he considered
testimony on that subject.
The Association then filed this complaint. It did not seek to vacate the
arbitrator's award, which was limited solely to his conclusion (indisputably
correct) that under Step Five of the CNA, the no-reason termination was not
arbitrable. Rather, the Association's complaint alleged that the CNA trumped
the individual contract because the contracts were conflicting. The complaint
also alleged that the Association established a cause of action seeking to
challenge the good-cause termination because the Board gave inconsistent
reasons for terminating the employee.
A-3574-18T2
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If the Board relied solely on the individual contract's no-reason
termination provision and did not simultaneously claim it had good cause
under the CNA, the Association might not have filed the complaint because the
Association concedes that under the CNA, no-reason terminations are not
arbitrable. We need not reach the question of whether a no-reason termination
is justiciable if it is not arbitrable because the Association has not explicitly
raised that issue.
Rather, the Association only contends the Board's good-cause
termination is justiciable, meaning the judge should decide whether the Board
had good cause to terminate the employee. The judge did not explicitly
resolve the justiciability of whether the Board had good cause to terminate the
employee under the CNA by analyzing the CNA's language. The CNA
addressed the forum in which good-cause grievances must be heard: Article
VII "Grievance/Arbitration Procedure" of the CNA states, "[t]he purpose of
this Article is to provide for the expeditious and mutually satisfactory
settlement of grievances and to that end the following procedures shall be the
sole and exclusive method of resolution." (Emphasis added). Arguably, a
good-cause challenge would therefore be arbitrable.
The complaint sought a declaratory judgment that the Board lacked good
cause to terminate the employee. The complaint does not seek arbitration on
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the good-cause issue despite the arbitrator's failure to resolve this issue. The
Board then moved to dismiss the complaint under Rule 4:6-2(e). The judge
did not consider whether the Association established a cause of action
challenging the good-cause determination. Rather, the judge dismissed the
complaint by applying—in part—the reasonably debatable standard used in
actions seeking to vacate arbitration awards.
We reverse and remand for further proceedings consistent with this
opinion. The employee is entitled to a resolution of whether the Board had
good cause to terminate him. He has that right because the Board asserted a
reason for his termination, and as a result, the CNA trumps the individual
contract. On remand, the parties should address—by motion or otherwise—
whether the CNA requires arbitration of the good-cause issue.
On appeal, the Association argues:
POINT I
[THE] STANDARD OF REVIEW OF A TRIAL
[JUDGE'S] INTERPRETATION OF LAW. (NOT
RAISED BELOW).
POINT II
THE [JUDGE] BELOW ERRED IN FINDING THAT
[THE EMPLOYEE'S] TERMINATION WAS NOT
JUSTICIABLE, EVEN THOUGH IT WAS FOUND
BY AN ARBITRATOR TO BE SUBSTANTIVELY
NOT ARBITRABLE.
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A. The Trial [Judge] Erred When [He] Failed to
Apply the New Jersey Supreme Court's Decision in
Jersey Central Power & Light as Controlling
Precedent in this Matter.
i. The [Judge] Below Incorrectly Applied the
Reasonably Debatable Standard Used in Actions to
Vacate Arbitration Awards.
ii. The [Judge] Below Erroneously Stated that the
Arbitrator Heard the Matter on the Merits Despite the
Arbitrator's Decision Stating the Contrary.
iii. The Arbitrator Dismissed the Grievance Based on
Substantive Arbitrability, not Procedural Arbitrability.
b. The [Judge] Below Failed to Recognize that the
Terms of [the Employee's] Individual Employment
Contract Were Subsidiary to the CNA Governing His
Employment.
We review an order granting a motion to dismiss de novo and we owe no
deference to the trial court's conclusions. Castello v. Wohler, 446 N.J. Super.
1, 14 (App. Div. 2016); Rezem Family Assocs., LP v. Borough of Millstone,
423 N.J. Super. 103, 114 (App. Div. 2011). A motion to dismiss for failure to
state a claim must be denied if, giving plaintiff the benefit of all his allegations
and all favorable inferences, a claim has been established. R. 4:6-2(e); see
also Banco Popular N. Am. v. Gandi, 184 N.J. 161, 165 (2005). The "inquiry
is limited to examining the legal sufficiency of the facts alleged on the face of
the complaint." Printing Mart-Morristown v. Sharp Elecs. Corp., 116 N.J. 739,
746 (1989).
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II.
We accept the facts as alleged in the complaint. The Board terminated
the employee because he left his supervisor a voicemail, which recorded him
calling her a "bitch." The Board's Superintendent verified that the termination
was "due to the voice mail." The Superintendent also notified the employee
that the Board was terminating him in accordance with the thirty-day no-
reason termination provision contained in his individual contract, which states:
It is hereby agreed by the parties hereto that this
contract may at any time be terminated by either party
giving to the other [thirty] days['] notice in writing of
intention to terminate the same, but that in the absence
of any provisions herein for a definite number of days'
notice the contract shall run for the full term named
above.
Instead of a no-reason thirty-day termination provision, Article VIII of the
CNA states: "The Board shall not suspend, discipline or discharge any
employee (other than probationary employees) except for good and just
cause."1 (Emphasis added). Neither the judge nor the arbitrator analyzed
whether the Board could have terminated the employee for no reason (under
the individual contract) while at the same time, be limited (under the CNA) to
terminating the employee solely for good cause. And if so, whether the CNA's
language trumped the individual contract.
1
Counsel represented that the employee is not a probationary employee.
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The CNA outlines a grievance process for terminations, and defines
grievance as "any dispute between the parties concerning the application,
interpretation or claimed violation of any provision of this Agreement, or any
administrative decision . . . which adversely affects the terms and conditions of
employment as set forth in this Agreement." Here, the employee invoked this
procedure by disputing good cause. Article VIII of the CNA imposes multiple
grievance steps:
Step [One]
The Association or an employee with a
grievance shall first discuss it with his immediate
supervisor either directly or through the Association's
representative within ten (10) working days after the
employee knew or should have known of the event
giving rise to the grievance. Failure to act within the
said ten (10) working days shall be deemed to
constitute a waiver and abandonment of the grievance.
Step [Two]
If the aggrieved party is not satisfied with the
disposition of the grievance at Step [One], or if no
decision has been rendered within five (5) working
days after the presentation of that grievance at Step
[One], the Association may file within five (5)
working days with the Business Administrator of the
district a written grievance setting forth the nature of
the grievance and designated contract provision(s)
claimed to have been violated.
....
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Step [Three]
If the aggrieved party is not satisfied with the
disposition of the grievance at Step [Two], or if no
decision has been rendered within seven (7) working
days after the presentation of that grievance at Step
[Two], the Association may file within five (5)
working days with the Superintendent of Schools the
written grievance.
....
Step [Four]
If a grievance is not resolved at Step [Three], or
if no written decision has been rendered within the
allotted ten (10) working days set forth at Step
[Three], the Association may, within ten (10) working
days, make a written request for review by the
Board[.]
....
Step [Five]
A grievance to proceed to Step [Five] must be
concerned with the interpretation, meaning or
application of any of the provisions of this Agreement.
The Board's exercise of the [thirty]-day no-reason
termination clause of an employee's employment
contract shall not be reviewable by binding arbitration.
If a grievance is not resolved at Step [Four] or if no
written decision has been rendered within the time
allotted under Step [Four], the Association may,
within ten (10) working days, make a written demand
for arbitration to the New Jersey Public Employment
Relations Committee[.]
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The Association filed a grievance on the employee's behalf stating that
the Board lacked good or just cause to terminate the employee. The
Association followed Step One by presenting the grievance to the employee's
immediate supervisor, who denied the grievance. It proceeded to Step Two by
filing its grievance with the School Business Administrator, who also denied
it. It then proceeded to Step Three and filed the grievance with the
Superintendent, who also denied the grievance, stating: "There was ample
cause . . . to terminate [the employee] for his unbecoming conduct." Pursuant
to Step Four, the Association requested a hearing before the Board to
determine the grievance. The Board conducted the hearing but denied the
employee's grievance because "there was ample cause for [the employee's]
termination." Thereafter, under Step Five, the Association made a demand for
arbitration directly with the Public Employment Relations Commission
(PERC). PERC selected the arbitrator. The parties expected the arbitrator to
decide whether the good-cause grievance was arbitrable, and if so, whether the
Board had good or just cause to terminate the employee.
At the arbitration, the Association argued that the Board waived the
thirty-day no reason termination because it terminated the employee for cause.
The Association also contended the termination language in the contracts
conflicted, and therefore the CNA trumped the individual contract. It focused
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on its good-cause challenge, arguing the Board failed to establish good or just
cause to terminate the employee, specifically because the Board did not
enforce its zero-tolerance policy on profanity. The Board argued that under
Step Five of the CNA, the grievance was not arbitrable because the Board
terminated the employee using the thirty-day no-reason termination clause.
The Board contended it nevertheless had good and just cause to terminate him
based on the voicemail.
Focusing on good cause, several teachers testified at the arbitration that
the Board does not enforce its zero-tolerance policy on profanity. The
arbitrator acknowledged the Association's argument that the Board gave
inconsistent reasons for terminating the employee, but he dismissed the
arbitration solely because Step Five of the CNA states no-reason terminations
are not arbitrable. The CNA specifically expresses, "[t]he Board's exercise of
the [thirty]-day no-reason termination clause of an employee's employment
contract shall not be reviewable by binding arbitration." Therefore, the
arbitrator concluded the grievance could not proceed on the merits because it
was not "procedurally arbitrable," but he made no findings about good cause.
The arbitrator also stated:
The fact that the Board may have offered an additional
reason for discharging the [employee] beyond its
express right under the employment contract does not
nullify the Board's ability to exercise the termination
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clause therein. It is for these reasons that the
grievance is not arbitrable pursuant to the express
language in the parties' Agreement[.]
Finally, the arbitrator emphasized: "[B]ased upon the foregoing and the entire
record, I conclude that the evidence supports the Board's position that the
grievance is not arbitrable and, therefore, cannot proceed to be heard on [the]
merits."
At oral argument before us, counsel conceded the contracts are in
conflict. Article VIII of the CNA provides only a good or just cause standard
for termination. The individual employment contract allows a thirty -day no-
reason termination. Our Supreme Court has held that individual employment
contracts are "subsidiary to the terms of the . . . [CNA] and [they] may not
waive any of its benefits." Mount Holly Twp. Bd. of Educ. v. Mount Holly
Twp. Educ. Ass'n, 199 N.J. 319, 328 (2009) (first alteration in original)
(quoting J.I. Case Co. v. NLRB, 321 U.S. 332, 336 (1944)). Here, the CNA
gave the employee the benefit of challenging good cause. It is settled that
"[t]o the extent provisions in an individual employment contract conflict or are
inconsistent with terms in a [CNA], and diminish or interfere with rights
provided by the CNA, the language in the individual contract must yield to the
CNA." Id. at 329.
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In Mount Holly, the employee's individual employment contract had a
fourteen-day no-reason termination policy, and a termination under this
provision was not arbitrable. Id. at 330. However, the parties' CNA stated
"[n]o employee shall be discharged . . . without just cause," and just cause
grievances were arbitrable. Ibid. (alterations in original). The defendant
terminated the employee under the no-reason termination policy. Ibid. The
Court found the two documents were in conflict, and the individual
employment contract interfered with the employee's rights under the CNA.
Ibid. It remanded for arbitration. Ibid.
Here, the Board argues that the contracts are consistent as to the no-
reason termination provision. Indeed, if the Board's sole reason for
terminating the employee was for "no reason," then the CNA is consistent
because it states that such a basis for terminating an employee is not arbitrable.
That is undisputed. But once the Board asserted that it had cause to terminate
the employee because of the voicemail, the good and just cause reason for the
termination revealed the contract's inconsistencies and entitled the employee to
invoke his rights under the CNA.
Our ruling's practical effect is that the Board nullified the no-reason
termination by giving the employee a reason for his termination. The CNA
therefore trumps the individual contract, which entitles the employee to a
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resolution of whether the Board had good cause to terminate him for the
voicemail. On a Rule 4:6-2(e) motion, we therefore conclude that the
Association established a cause of action seeking to challenge the good-cause
determination. On remand, the parties should address the question in the first
instance of whether the CNA requires arbitration of the good-cause issue. If
the parties cannot agree, then they should engage in motion practice to resolve
whether the CNA's language requires arbitration of the good-cause issue—an
issue that was not resolved by the arbitrator or the judge.
Reversed and remanded for further proceedings consistent with this
opinion. We do not retain jurisdiction.
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