City of Grand Rapids v. Grand Rapids Lodge No. 97 Fraternal Order of Police

• Decision Date: 23 December 1982
• Docket Number: No. 10,Docket No. 65303,10
• Citation: 415 Mich. 628,330 N.W.2d 52
• Parties: , 114 L.R.R.M. (BNA) 3684 The CITY OF GRAND RAPIDS, Plaintiff-Appellant, v. GRAND RAPIDS LODGE NO. 97 FRATERNAL ORDER OF POLICE, Defendant-Appellee. Calendar
• Court: Michigan Supreme Court

Page 52

330 N.W.2d 52

415 Mich. 628, 114 L.R.R.M. (BNA) 3684

The CITY OF GRAND RAPIDS, Plaintiff-Appellant, v. GRAND RAPIDS LODGE NO. 97 FRATERNAL ORDER OF POLICE Defendant-Appellee.

Docket No. 65303.

Calendar No. 10.

Supreme Court of Michigan.

Argued April 8, 1981.

Decided Dec. 23, 1982.

Varnum, Riddering, Wierengo & Christenson, Terrance R. Bacon, Bruce G. Hudson, Grand Rapids, for plaintiff-appellant.

Rosenbaum & Holland, Timothy G. Holland, Lansing, for defendant-appellee.

LEVIN, Justice (to reverse).

The questions presented are: (i) whether a collective-bargaining agreement providing for arbitration as the final step in the grievance procedure may validly provide that the grievance proceedings terminate if an employee claiming to be aggrieved by an employer's breach of the collective-bargaining agreement submits the subject matter of the grievance to adjudication in a court of law, and (ii) whether the instant agreement so provides.

We answer both questions in the affirmative.

I

As with any other mandatory subject of collective bargaining, the employer and the union have a statutory obligation to meet and bargain in good faith regarding grievance procedures. ¹ The statute is, however, neutral regarding the means of resolving a grievance. Thus the parties have no statutory obligation to agree to any particular procedure. While arbitration has come to be the favored procedure for resolving grievances in federal and Michigan labor relations, ² it is--as the dissenting opinion acknowledges--a matter of contract; there is no requirement that grievances be resolved by arbitration:

"Arbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed to submit." United Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 582, 80 S.Ct. 1347, 1353, 4 L.Ed.2d 1409 (1960).

The preference for arbitration in Michigan and federal labor law is triggered only if the parties agree to arbitrate. That preference does not operate to override the intent of the parties. The law does not require the employer, the union, or the employee members to forego judicial resolution of disputes concerning the meaning of a collective-bargaining agreement. They may choose to submit disputes to an arbitrator in preference to a judge and, if they agree to that, the law enforces their stated or agreed-upon preference. It is by enforcing the agreement of the parties in lieu of adjudication that the law "prefers" arbitration.

If a grievance arises under a collective-bargaining agreement, including a dispute concerning its construction, there is a duty to bargain over the grievance. If the agreement provides a method or procedure for addressing a grievance, it must be observed. If no method or procedure was previously agreed upon, the parties must simply negotiate on the grievance in good faith. If the negotiation is unsuccessful, there may be a work stoppage (in the private sector), or adjudication by a court, or, if the parties agree, some other method of resolution (such as ad hoc arbitration), or they may simply drop the whole matter. The statute compels no particular form of dispute resolution, nor that the parties even agree to resolve the grievance, only that the parties negotiate over the grievance.

While most collective-bargaining agreements provide for arbitration as the final step in an agreed-upon grievance procedure, that is purely a matter of choice by the parties. Some collective-bargaining agreements set forth a procedure for resolving grievances arising in the administration of the contract that does not include arbitration. Others set forth a procedure which does not provide a means of deciding a grievance that the parties cannot resolve by negotiation. Still others provide no procedure at all for resolving grievances.

If a collective-bargaining agreement contains a grievance resolution procedure, the courts generally require exhaustion of that procedure before the initiation of a lawsuit. ³ If the grievance procedure includes In the instant case, however, the collective-bargaining agreement provides that if an action is commenced the grievance proceedings shall end.

arbitration, the courts normally defer to the arbitration decision. ⁴ However, where arbitration is not the mandatory final step in a grievance procedure, a member of the union aggrieved by the asserted breach of the collective-bargaining agreement may resort to an action at law to obtain satisfaction. ⁵ Commencement of such an action might not relieve the employer of its obligation to negotiate concerning the grievance with the union.

The dissenting opinion would hold that a collective-bargaining agreement cannot validly provide that the obligation of the parties to negotiate regarding a grievance terminates when an employee has made the grievance the subject of a lawsuit.

Even if that is a correct view, and it is not, it would not follow that the grievance is to be decided, if the employer and union cannot agree, by arbitration. If they cannot agree, their only statutory duty is to continue to negotiate--that is the statutory right; there is no statutory right to binding arbitration.

But even the union's right to resolve a grievance by negotiation may be relinquished, and it was relinquished here.

The union can give up its collective rights, including the right to strike and the right to negotiate over grievances. ⁶ Indeed, that is what it does when it agrees to arbitrate; it gives up the right to strike over the grievance and the right to continue to bargain over it. And just as it can relinquish its right to further negotiation and proceed to arbitration, or file a court action, or (in the private sector) strike over the grievance, it can relinquish its right to further negotiation when the grievance becomes the subject of litigation. Relinquishment of the union's right to negotiate further upon the commencement of litigation is what occurred here.

Grievance procedures arise solely from the labor agreement. In drafting the agreement, the union and the employer are free to exclude matters from the grievance procedure, to choose who shall adjudicate disputes that arise under the agreement, to designate who may seek its enforcement, and to relinquish whatever interest the union may have in grievance resolution.

The union has no right to continue to negotiate regarding a grievance after the last step of a grievance procedure. In the instant case, the collective-bargaining agreement contemplated that negotiation would end when the grievance was made the subject of a lawsuit. ⁷ Therefore, the union here has no right to continue to negotiate regarding the subject matter of Mr. Stevens' cross-claim or to arbitrate it.

While it has become customary to agree upon grievance arbitration as the final step, that convention has not yet become law.

II

In excluding topics from arbitration, this Court has required either an express provision or the "most forceful evidence" of exclusion. ⁸ The provision at issue expressly excludes from arbitration "any matter" taken before a court or administrative forum. ⁹ We hold that this provision does what it in terms states, and that it precluded the union from pursuing the grievance after Mr. Stevens filed a cross-claim in court on the same issue as the grievance.

We reverse the judgment of the Court of Appeals, 96 Mich.App. 226, 292 N.W.2d 529.

COLEMAN, C.J., and FITZGERALD, KAVANAGH and RYAN, JJ., concur.

RILEY, J., not participating.

WILLIAMS, Justice.

INTRODUCTION

The issue presented to the Court in this case is the validity of an election-of-remedies provision included in a collective-bargaining agreement which provides that once a matter is raised in another forum the grounds for a grievance through the collective-bargaining agreement no longer exist. In essence, the provision allows the individual to proceed with his grievance in whatever forum he chooses and totally abrogates the union's role in the grievance process. We hold that such a clause is invalid, as it violates the principle of exclusive representation and fails to adequately recognize the union's role in the grievance procedure.

FACTS

Ronnie F. Stevens, a member of the defendant union, was sued in federal court in April, 1978, as a result of a shooting that occurred while Stevens was a police officer. Stevens notified the city attorney of the proceedings, as it was his belief that the collective-bargaining agreement ¹ between the City of Grand Rapids and Grand Rapids Lodge 97, Fraternal Order of Police (hereinafter the union) provided that the city would assume the cost of his defense and judgment against him, if any. The city refused to provide counsel or to indemnify him. In May, 1978, the union filed a grievance alleging a violation of the collective-bargaining agreement based on the city's refusal to assume these contractual obligations.

Subsequently, Stevens filed a cross-claim against the city on June 9, 1978, in the pending federal suit which asserted the same issues raised in the grievance filed by the union. On June 19, 1978, the union filed a demand for arbitration on the grievance. It was received the next day by the American Arbitration Association, and on this same day the city filed an answer to the cross-claim in federal court.

The city thereafter initiated this action to restrain arbitration on the grievance since it was also the subject of a federal court proceeding. A temporary injunction order against arbitration was issued by the Kent Circuit Court, because it found that Article VIII, Sec. 3b ² of the collective-bargaining agreement expressly excluded this claim from the arbitration process.

A petition for reconsideration was denied following a hearing by the circuit court. Defaults were entered against the American Arbitration Association and Stevens.

The union obtained leave to appeal in the Court of Appeals, and, on March 17,...