In re Kelley

• Decision Date: 31 August 2018
• Docket Number: No. 17-429,17-429
• Citation: 198 A.3d 44
• Parties: IN RE Grievance of Kobe KELLEY
• Court: Vermont Supreme Court

198 A.3d 44

IN RE Grievance of Kobe KELLEY

No. 17-429

Supreme Court of Vermont.

June Term, 2018

August 31, 2018

Thomas J. Donovan, Jr., Attorney General, and Melanie Kehne, Assistant Attorney General, Montpelier, for Appellant.

Timothy Belcher, Vermont State Employees' Association, Montpelier, for Appellee.

PRESENT: Reiber, C.J., Skoglund, Robinson, Eaton and Carroll, JJ.

EATON, J.

¶ 1. The State appeals a decision of the Vermont Labor Relations Board interpreting a collective bargaining agreement between the State and the Vermont State Employees' Association (VSEA). The question at issue is whether a change made to the agreement's family-leave provisions in 1999 limited an employee's right to use more than six weeks of accrued, paid sick leave while on family leave because of the employee's own serious illness. The Board found that, although the agreement itself was ambiguous, extrinsic evidence showed that the parties did not intend to limit the use of sick leave. The State argues on appeal that the contract is not ambiguous and that the limitation on use of sick leave applies. We affirm.

I. Background

¶ 2. Grievant, Kobe Kelley, worked for thirteen years as a surveyor for the Vermont Agency of Transportation and is now retired. About a year before his retirement, he fractured his knee

while on vacation. As a result, he took a seven-week leave from work. At the beginning of this period, Kelley was placed on unpaid family leave by his supervisor, under Article 35 of the collective bargaining agreement negotiated between the State and VSEA for the Non-Management Unit. For the first six weeks of this family leave, Kelley was allowed to make use of his accrued sick leave in order to continue to receive pay, but for the last week he was required to use paid annual leave that he had accrued instead. This was pursuant to the State's interpretation of the provisions of Article 35. VSEA filed a grievance on behalf of Kelley, arguing that under a different provision of the collective bargaining agreement, Article 31, Kelley had the right to use his sick leave during this final week in addition to the initial six weeks.

¶ 3. The classification of paid leave in these circumstances matters to both employees and the State because while employees are not compensated for their accrued sick leave when they leave their jobs or retire, they do receive compensation at that point for other forms of accrued leave—including the annual leave that Kelley was forced to use. The requirement to use annual leave rather than sick leave during the final week of Kelley's seven weeks away from work therefore reduced both an accrued liability for the State and future accrued benefits for Kelley. Counsel for VSEA stated at oral argument before this Court that there are currently between fifty and one hundred other state employees with grievances turning on this question.

¶ 4. The correct classification of paid leave in this situation depends on the relationship between the relevant two articles of the collective bargaining agreement: Article 31, entitled "Sick Leave," and Article 35, entitled "Parental Leave/Family Leave." Article 31 provides that a classified employee "who cannot work due to illness or injury" may use "earned sick leave credits." Such a provision has been part of the collective bargaining agreements between the State and VSEA since 1976. The Article does not contain any limitation on how or when credits may be used.

¶ 5. Article 35 is more complex. The core provision is found in Article 35(5)(a), which provides that family leave shall be granted "[i]n the case of serious illness of an employee or of a member of the employee's immediate family." Article 35(5)(b) then lays out an exception to the general rule that family leave is unpaid. While on family leave, an employee may choose to simultaneously "use up to six (6) weeks of any accrued paid leave, including, but not limited to, sick leave, annual leave and personal leave." After six weeks, however, "employees may use only the following accrued paid leaves in the following order: compensatory time, personal time, and annual leave." This latter provision is referred to as "the cascade." Once the twelve weeks of family leave are exhausted, all types of remaining accrued leave may again be applied freely.

¶ 6. Article 35 was added to the agreement in response to Vermont's 1989 Parental and Family Leave Act, 21 V.S.A. §§ 470 - 474, and its 1994 federal counterpart, the Family Medical Leave Act, 29 U.S.C. §§ 2601 - 2654. Both statutes guarantee qualifying employees twelve weeks of unpaid leave for family or parental care within a twelve-month period, with conditions. Notably, the Vermont statute gives employees the right to use accrued paid leave during family leave, but only for a period "not to exceed six weeks." 21 V.S.A. § 472(b). Both statutes also contain explicit statements that they do not diminish any more generous rights guaranteed under collective bargaining agreements. 21 V.S.A. § 472(g); 29 U.S.C. § 2652(a). Article 35(1) of the collective bargaining agreement likewise includes the following nonwaiver provision: "The following provisions integrate the basic requirements of the statutes and this collective bargaining agreement ... but do not create a waiver by the State or by the employees of other rights and/or obligations under this Agreement."

¶ 7. At the Board's hearing, VSEA argued that the State could not force Kelley to use annual leave, given that he enjoyed an unrestricted right to use accrued sick leave under Article 31. The State argued in reply that the language of the contract was clear and unambiguous: the "cascade" provision of Article 35(5)(b) applied whenever an employee requested leave for a serious injury or illness, including his or her own, with this limitation of the use of sick leave in a specific circumstance superseding the general guarantee in Article 31.

¶ 8. The Board decided that the contract itself was ambiguous and therefore turned to extrinsic evidence to interpret it. It concluded that the parties to the 1999 negotiations did not intend the addition of Article 35 to diminish the rights of employees to use accrued sick leave for their own serious illness. It also found that, although the State's Department of Human Resources had advised state agencies to apply the "cascade" provision to employees taking off time for their own serious illness after the 1999 negotiations, the provision was not known to have been applied to employees in that situation until 2014. The State's own past practice thus did not suggest that it had seen itself as winning a concession in the 1999 negotiation. On these bases, the Board sided with VSEA's interpretation and sustained Kelley's grievance.

¶ 9. On appeal, the State again contends that the contract is not ambiguous: the "cascade" provision of Article 35 contains no exemptions and therefore governs whenever an employee is off work because of a "serious illness," whether their own or that of a family member. The State asserts there is no conflict between Articles 31 and 35 because the "cascade" provision "provides a framework" for implementing the general guarantee of sick leave in Article 31 in cases specifically involving "serious" illness. The State also argues that, even if the agreement is ambiguous, the evidence of bargaining history does not suggest that the "cascade" provision includes an implied exemption for when an employee is on family leave for their own serious illness. Nor, they contend, can past practice alter the meaning of the contract.

¶ 10. In response, VSEA argues that the Board's finding in favor of Kelley is in fact supported by the "clear and unambiguous language of the agreement," because the nonwaiver provision in Article 35(1) protects an unrestricted right to sick leave guaranteed by Article 31. VSEA claims employees taking leave for their own serious illness may choose whether or not to invoke their family leave rights under Article 35. If they do so, then their use of sick leave is capped by the "cascade." If they do not invoke their Article 35 rights, then they remain solely under Article 31 and their use of accrued sick leave is unrestricted, although any time taken off will still count against the twelve-week limit on family leave if they choose to invoke their family leave rights at a later point. Although VSEA denies that the contract is ambiguous, it agrees with the Board's conclusion that extrinsic evidence shows that Article 35 was not intended to diminish employees' ability to use sick leave. VSEA thus agrees with the Board's ruling in favor of Kelley, but arrives at it by a somewhat different route. At oral argument, VSEA further conceded that their theory by which employees have a choice between the Article 31 and Article 35 regimes was not part of the Board's holding below.

II. Standard of Review

¶ 11. In general, whether a given contract term is ambiguous is a question of law that we review de novo. Trs. of Net Realty Holding Tr. v. AVCO Fin. Servs. of Barre, Inc., 144 Vt. 243, 248, 476 A.2d 530, 533 (1984). But if the contract is ambiguous, then the question of what the parties originally intended is a question for the trier of fact, whose conclusions we review only for clear error. City of Newport v. Vill. of Derby Ctr., 2014 VT 108, ¶ 6, 197 Vt. 560, 109 A.3d 412.

¶ 12. In this situation, moreover, we review with an even lighter touch than in a typical contract dispute. Because the construction of terms in collective bargaining agreements is within the special expertise of the Board, we review the Board's interpretation of these agreements "with great deference." In re West, 165 Vt. 445, 448, 685 A.2d 1099, 1102 (1996). If there is factual support for the Board's conclusion, this Court will leave it undisturbed. In re VSEA, 164 Vt. 214, 216, 666 A.2d 1182, 1183 (1995).

III. Analysis

¶ 13. The question before us is: does the collective bargaining agreement give employees an...