Board of Educ. of Prince George's County v. Prince George's County Educators' Ass'n, Inc.

• Decision Date: 01 September 1985
• Docket Number: No. 55,55
• Citation: 309 Md. 85,522 A.2d 931
• Parties: , 125 L.R.R.M. (BNA) 2923, 38 Ed. Law Rep. 240 BOARD OF EDUCATION OF PRINCE GEORGE'S COUNTY v. PRINCE GEORGE'S COUNTY EDUCATORS' ASSOCIATION, INC
• Court: Maryland Court of Appeals

Page 85

309 Md. 85

522 A.2d 931, 125 L.R.R.M. (BNA) 2923,

38 Ed. Law Rep. 240

BOARD OF EDUCATION OF PRINCE GEORGE'S COUNTY v. PRINCE GEORGE'S COUNTY EDUCATORS' ASSOCIATION, INC.

No. 55 Sept. Term, 1985.

Court of Appeals of Maryland.

March 26, 1987.

Paul M. Nussbaum (Sheldon L. Gnatt, on the brief), Greenbelt, for appellant.

Susan W. Russell (Walter S. Levin and Weinberg & Green, on the brief), Baltimore, for appellee.

Argued before MURPHY, C.J., and SMITH, ^* ELDRIDGE, COLE, RODOWSKY, COUCH and McAULIFFE, JJ.

ELDRIDGE, Judge.

This case concerns the standard of review applicable to judicial consideration of a petition to vacate a public-sector labor arbitration award under Maryland Code (1978, 1985 Repl.Vol.), § 6-408 of the Education Article. The issue in this case is whether the circuit court erred in refusing to vacate the arbitration award.

I.

Prince George's County Educators' Association is the exclusive bargaining representative for certificated teachers in the Prince George's County public school system. In September 1981, the Association and the Prince George's County Board of Education entered into a collective bargaining agreement effective from August 1, 1981, until August 31, 1983, which established wages, hours, and working conditions for all certificated professional employees of the Board. The agreement set forth a grievance procedure, culminating in arbitration. The agreement was authorized by § 6-408(a) of the Education Article of the Code.

In 1982, the Association filed a formal grievance over a dispute with the Board involving the driver education program. The Association alleged that changes in the driver education program pursuant to a Board resolution violated the collective bargaining agreement then in effect by unilaterally reducing the rank and pay of driver education teachers without cause.

The facts giving rise to the grievance can be summarized as follows. Prior to the 1979-1980 school year, § 7-412 of the Education Article required each county board of education to offer driver education instruction. Accordingly, the Prince George's County Board of Education offered driver education during the regular school day, in the evenings during the school year, and in the summer. The program was free for students of the Prince George's County school system; non-students were required to pay a fee. The Board received payment from the State Department of Transportation for each student who completed the course. See Code (1977), § 16-508 of the Transportation Article.

For regular school day instruction, driver education teachers were paid according to a wage scale that was negotiated between the Board and the Association as part of the collective bargaining agreement. This wage scale, applicable to all teachers, made no distinctions based on subject matter taught. The collective bargaining agreement provided that all teachers engaged in after-school teaching were to be paid at an hourly rate of 1/1500 of their regular annual salary while adult education teachers were to be paid at a flat hourly rate. Since 1974, driver education teachers have been part of the after-school program and paid accordingly. ¹ All summer school teachers, including driver education teachers, were also paid at an hourly rate of 1/1500 of their regular annual salary. The collective bargaining agreements between the parties have never isolated driver education teachers as a specific category of personnel insofar as salary schedules are concerned. The salary schedules distinguish only between regular school day, after-school, adult education and summer instruction.

In 1979 the Maryland General Assembly amended § 7-412(a) of the Education Article to permit, but no longer require, county boards of education to offer driver education instruction. Fiscal considerations prompted the Prince George's County Board of Education to pass a resolution in April 1982 eliminating driver education from its regular high school curriculum. In order to meet the demand for driver education, however, the Board resolved to establish a "Driver Education School to be operated separate and apart from all other programs of instruction mandated by law...." The Driver Education School was authorized to provide instruction when school was not in session, i.e., after school and during the summer. The resolution provided that the Driver Education School was "to be funded strictly from tuition charged to the students enrolling therein and the monies received through the Driver Education Account of the Transportation Trust Fund pursuant to the provisions of Md.Ann.Code, Transportation Article § 16-508(b)." The Board resolved that the Driver Education School was "a separate and distinct educational component of the Board...." The driver education program under this new system became operational in the summer of 1982.

At the same time the Board also established a new pay rate for driver education teachers that was significantly less than the hourly rate of 1/1500 of the regular annual salary which had previously been paid. The new rates were $8.50 per hour for "laboratory" and behind-the-wheel instruction and $12.50 per hour for classroom instruction.

Several driver education teachers filed a grievance, which the Association ultimately took to arbitration. The grievance requested that the Board return the driver education teachers to their previous rate of pay. An arbitrator from the American Arbitration Association denied the grievance in an opinion and award dated April 30, 1983.

The arbitrator found that the Board's practice since 1974 of paying driver education teachers at the hourly rate of 1/1500 of their regular salary "was a fixed practice consistently followed and became a part of the parties' Agreement, notwithstanding the failure to specifically incorporate that condition of employment in the written collective bargaining agreement." The arbitrator further found, however, that "the Driver Education School was a separate entity from the Board of Education because it had its own budget and its own structure and the intent of the [Board] ... was to establish a separate entity." Additionally, the arbitrator found that the Driver Education School "performed the same functions, in the same manner, at essentially the same locations, with the same overall supervisor, and with a majority of the same employees" as the old program. The arbitrator applied the "successorship doctrine," a principle of labor law, to hold that the Driver Education School was not bound by the terms of the collective bargaining agreement between the Association and the Board. See NLRB v. Burns International Security Services, Inc., 406 U.S. 272, 92 S.Ct. 1571, 32 L.Ed.2d 61 (1972). Therefore, according to the arbitrator, the Driver Education School could rightfully establish different compensation for the teachers which it hired.

The Association filed a petition in the Circuit Court for Prince George's County, "pursuant to Section 3-201 et seq., Cts. & Jud.Proc. Article of the Annotated Code of Maryland (1980), commonly known as the Maryland Uniform Arbitration Act, and pursuant to Maryland Rule E 2." The Association sought to vacate the arbitration award, asserting that "the Opinion and Award of the Arbitrator is completely irrational and, as such, exceeds the Arbitrator's power and was procured by undue means." Both sides filed motions for summary judgment. In the accompanying memoranda, each side took the position that the standards set forth in the Maryland Uniform Arbitration Act, Code (1974, 1984 Repl.Vol.), § 3-224 of the Courts and Judicial Proceedings Article, controlled and furnished the substantive grounds for vacating the arbitration award. Section 3-224 provides in relevant part as follows:

"(b) Grounds.--The court shall vacate an award if:

(1) An award was procured by corruption, fraud, or other undue means;

(2) There was evident partiality by an arbitrator appointed as a neutral, corruption in any arbitrator, or misconduct prejudicing the rights of any party;

(3) The arbitrators exceeded their powers;

(4) The arbitrators refused to postpone the hearing upon sufficient cause being shown for the postponement, refused to hear evidence material to the controversy, or otherwise so conducted the hearing, contrary to the provisions of § 3-213, as to prejudice substantially the rights of a party; or (5) There was no arbitration agreement as described in § 3-206, the issue was not adversely determined in proceedings under § 3-208, and the party did not participate in the arbitration hearing without raising the objection.

(c) When award not to be vacated.--The court shall not vacate the award or refuse to confirm the award on the ground that a court of law or equity could not or would not grant the same relief."

The Association maintained that the arbitrator's finding that the Driver Education School was a separate entity from the Board was a "gross mistake," that the Board was the "sole employer," and that the decision was "completely irrational." The Association asserted that subsections (b)(1) and (b)(3) of § 3-224, relating to awards procured by undue means and awards in excess of the arbitrator's powers, authorized the circuit court to vacate the award.

After a hearing, the circuit court rendered an oral opinion holding that the award was not procured by "undue means" and that the arbitrator did not exceed his powers in concluding that the Driver Education School "was an independent organization, and that the then Driver Education instructors were under the employ of the successor employer." Thereafter, judgment was entered granting the Board's motion for summary judgment.

Upon the Association's appeal, the Court of Special Appeals reversed, deciding that the award should have been vacated. P.G. Co. Educators' Ass'n v. Bd. of Educ., 61 Md.App. 249, 486 A.2d 228 (1985). Like the parties and the circuit court, the Court of Special...