Wednesday, November 29, 2017

Interest Arbitration Update: Arbitrator Denies Employer’s Proposal For A Residency Requirement For New Hires

Residency requirements are hugely unpopular among police officers.  On one hand, police officers believe their work should guarantee them the freedom to live where they can best provide for their needs and the needs of their families. On the other hand, public employers believe police officers should live within, and be an integral part of, the communities they serve and protect. 2016, the City of Springfield passed an ordinance requiring all non-union employees hired after January 1, 2017, to live within the city limits or move here within 12 months of being hired. Under the ordinance, existing employees who already live outside the city would not be required to move.  The City previously had a full residency requirement from 1976 up until 2000, when the prior ordinance was repealed. A version of the ordinance remained in effect that required certain members of the mayor’s administration to live in the city.  The ordinance was unpopular with many of the City’s collective bargaining units.  Following the passage of the ordinance, the City sought to include residency in the PBPA collective bargaining agreement as it had done with other civilian bargaining units and in accordance with the new ordinance.  Unsurprisingly, the PBPA rejected the City’s residency proposal on the basis that it imposed a two-tiered class of employees within the PBPA, some that live outside the City and some that do not.  The parties were unable to reach an amicable accord, resulting in impasse and the PBPA invoking interest arbitration.

At interest arbitration, the Union asserted that the residency proposal should be rejected because: (1) it impinges on freedom of choice regarding residency, housing and choice of school districts; (2) freedom to reside outside the city's boundaries may contribute to the safety of police officers; (3) there are no residency requirements for comparable cities; (4) arbitrators have resisted awarding a restriction or the enlargement of residency restriction, unless it is proven broken; and (5) just because residency may be a good idea, it is insufficient to change it, especially at interest arbitration.  In response, the City explained that internal comparables should be given primary weight in awarding residency for newly-hired police officers to the City because: (1) the new residency ordinance had been passed for all non-union employees, including Police Lieutenants and above in the Springfield Police Department; and (2) the City reached agreements for residency to apply in all of its 22 collective bargaining agreements with the sole exception of the PBPA.  The City also emphasized that the residency requirement would serve as a catalyst to rebuild Springfield.

After the parties submitted evidence and post-hearing briefs, Arbitrator Marvin Hill rejected the City’s proposal to include a residency requirement applicable to new hires in the collective bargaining agreement. In siding with the PBPA, Arbitrator Hill was essentially reluctant to impose a residency requirement where one had not previously existed, and was particularly disinclined to impose one limited to new hires because it could create a divisive situation, particularly where those required to utilize the much smaller residency area become the majority or close to the majority of the bargaining unit.  Arbitrator Hill further explained that because the City sought to deviate from the status quo, it did not prove that there was a need for change and that the proposed language meets the identified need without posing an undue hardship on the other party. In other words, the status quo is that there exists no general residency requirements and the City has not sustained its burden to justify a change in the collective bargaining agreement.

When approaching negotiations, or possibly an interest arbitration, public sector employers should consider several takeaways from this award.

  • Burden of Proof: With respect to proposals that are based on a need for change, the party seeking the change bears the burden of proof. For example, if a public sector employer seeks a significant change in the collective bargaining relationship, it bears the burden of proof.
  • Back It Up: If a public sector employer seeks a significant change in the collective bargaining relationship, be sure to have evidence that supports the position that the current system is broken, there are adverse effects, or there is a significant economic impact to the employer.
  • Review Prior Awards:  Interest arbitrators generally set boundaries within which the parties can navigate and negotiate, and if there are any major changes outside of that boundary, the parties will literally have to bargain and trade for those changes because an interest arbitrator is not going to give those changes to them.
  • Conservative Process:  Remember that interest arbitration is a very conservative process.  Absent a demonstrated need for some degree of "catch up" with the comparable group, arbitrators try to ensure that the employees keep pace with the group. Put another way, the focus is not so much on the current value of the benefits that others in the comparable communities receive as it is on whether that value has changed.
We will continue to apprise you of interest arbitration developments. Please let us know if you have questions about this award of the interest arbitration process.