Middlebury v. Fraternal Order of Police, Middlebury

• Decision Date: 10 May 2022
• Docket Number: AC 44061
• Parties: TOWN OF MIDDLEBURY v. FRATERNAL ORDER OF POLICE, MIDDLEBURY LODGE NO. 34 ET AL.
• Court: Connecticut Court of Appeals

TOWN OF MIDDLEBURY
v.
FRATERNAL ORDER OF POLICE, MIDDLEBURY LODGE NO. 34 ET AL.

No. AC 44061

Court of Appeals of Connecticut

May 10, 2022

Argued November 8, 2021

Procedural History

Appeal from the decision of the defendant State Board of Labor Relations determining that the plaintiffs change in its practice of including extra duty pay in the calculation of pensions for members of the named defendant violated the Municipal Employees Relations Act, brought to the Superior Court in the judicial district of New Britain, where the court, Hon. Stephen F. Frazzini, judge trial referee, remanded the case to the defendant State Board of Labor Relations to determine whether a decision of the National Labor Relations Board applied retroactively; thereafter, the case was tried to the court, Hon. Stephen F. Frazzini, judge trial referee; judgment dismissing the appeal, from which the plaintiff appealed to this court. Affirmed.

Thomas G. Parisot, with whom was Connor McNamara, for the appellant (plaintiff).

Frank Cassetta, general counsel, with whom were J. Brian Meskill, and, on the brief, Harry B. Elliot, Jr., former general counsel, for the appellee (defendant State Board of Labor Relations).

David S. Taylor, for the appellee (named defendant).

Bright, C. J., and Moll and Bear, Js.

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OPINION

BRIGHT, C. J.

The plaintiff, the town of Middlebury (town), appeals from the judgment of the trial court dismissing the town's administrative appeal from the decision of the defendant State Board of Labor Relations (labor board). The labor board found that the town violated the Municipal Employee Relations Act (act), General Statutes § 7-467 et seq., by unilaterally changing an established past practice of including extra duty pay in the calculation of pensions for members of the defendant Fraternal Order of Police, Middlebury Lodge No. 34 (union), the union representing the town's police officers. On appeal, the town claims that the labor board improperly (1) concluded that it had jurisdiction over the union's prohibited practice complaint and (2) applied the incorrect standard for evaluating the town's contract defense to the unilateral change complaint. We disagree and, accordingly, affirm the judgment of the trial court.

The labor board found the following relevant facts. The town is a municipal employer under the act, and the union is an employee organization representing all full-time employees of the town's police department with authority to exercise police powers, except for the chief of police. By town meeting on March 22, 1967, the town established the Town of Middlebury Retirement Plan (retirement plan) and created the Retirement Plan Committee (retirement committee) to administer the plan. The three members of the retirement committee are appointed by the town's board of selectmen and must include one employee of the town, one member of the town's board of finance, and one citizen of the town. Under the retirement plan, the retirement committee "shall have complete authority in all matters pertaining to the administration of the [retirement] [p]lan." In addition, the retirement plan "may be amended, modified or discontinued in a [t]own [meeting held for that purpose."

In 1987, the town adopted a municipal charter, which provided that the provisions of the retirement plan "shall remain in full force and effect until such time as said plan is amended."

By town meeting on June 5, 1995, the town amended the retirement plan, changing, among other things, the definition of "salary" from "the actual compensation received from the [t]own in any plan year" to "the actual compensation paid to the employee by the [t]own in any calendar year . . . ." Section 7.2 of the retirement plan provides that "[t]he primary responsibility of the [retirement] [c]ommittee is to administer the [retirement] [p]lan for the exclusive benefit of the [m]embers and their [b]eneficiaries, subject to the specific terms of the [retirement] [p]lan. The [c]ommittee shall administer the [retirement] [p]lan in accordance with its terms

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. . . and shall have the power to determine all questions arising in connection with the administration, interpretation, and application of the [retirement] [p]lan. Any such determination by the [c]ommittee shall be conclusive and binding upon all affected parties.

"The [c]ommittee may correct any defect, supply any information, or reconcile any inconsistency in such manner and to such extent as shall be deemed necessary or advisable to carry out the purpose of the [retirement] [p]lan, provided, however, that any interpretation or construction shall be done in a nondiscriminatory manner. The [c]ommittee shall have all powers necessary or appropriate to accomplish its duties under the [retirement] [p]lan." Under § 7.6 of the retirement plan, "[t]he [t]own reserves the right at any time and from time to time by action of [t]own meeting to modify, amend or terminate the [retirement] [p]lan."

By town meeting on August 25, 2011, the town established the Town of Middlebury Defined Contribution Retirement Plan (defined contribution plan) to provide pension benefits for town employees hired on or after July 1, 2011. Under the defined contribution plan," '[compensation'" is defined as a "participant's wages as defined in [Internal Revenue] Code [§] 3401 (a) and all other payments of compensation by the [e]mployer (in the course of the [e]mployer's trade or business) for a [p]lan [y]ear . . . ."

The town and the union are parties to a series of successive collective bargaining agreements. The relevant collective bargaining agreement at issue before the labor board was effective from July 1, 2013, through June 30, 2017 (agreement). Under article XVI of the agreement, "[t]he [t]own agrees to maintain in effect for the duration of this [a]greement the [retirement] [p]lan dated July 1, 1967, as amended on July 1, 1995, and to further amend the [Retirement [p]lan to provide that employees retiring after twenty (20) years shall receive credit for [2.5 percent] of the average pay per year of service for the first twenty years of service and [2] percent for years 21 through 30 with a maximum benefit accrual of [70 percent]. . . . The employee contribution to the Middlebury Retirement Fund shall be [4.6 percent] for the duration of this agreement. . . . Those employees hired on or after July 1, 2013, shall become members of the . . . [d]efined [contribution [p]lan as developed by the [retirement committee], as approved at a [t]own [m]eeting on August 25, 2011."

Article VI, § 1, of the agreement provides for" 'special police duty'" or" 'extra police work'" (extra duty), defined as "assignment for work during off-duty hours for some other party or entity other than the police department or other than the [t]own." Article XVII, § 2, provides that "[a] 11 benefits, rights and privileges enjoyed by the employees prior to entering into this [a]greement which are not specifically provided for or

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which are not relinquished or abridged by or in conflict with the other provisions of this [a]greement are hereby made a part of and protected by this [agreement."

The labor board found that "[union] members have regularly worked extra duty. 'Extra duty' is work performed in the capacity of a police officer that is voluntary, occurs outside the member's normal work hours, is not performed as part of the member's normal duties, and is paid for by an entity other than the police department (e.g., a private contractor or another municipal department). Such entities pay the town the applicable rate for extra duty hours worked as well as an administrative surcharge assessed by the town. The town includes pay for extra duty hours worked in [union] members' regular paychecks and when it receives funds from third party entities, the town reimburses itself for such payments and retains the administrative surcharges. . . .

"[S]ince on or before 1988, the town included extra duty pay as 'salary' when calculating and paying pension benefits to [union] members and when calculating and collecting employee pension contributions, to the extent that such contributions were assessed, pursuant to the [retirement plan]. . . . [F]rom the inception of the defined contribution plan, the town included extra duty pay as 'compensation' when calculating and collecting employee or matching pension contributions to said plan." (Footnotes omitted.)

In March, 2017, the town and the union began negotiations for a successor agreement to the agreement expiring on June 30, 2017. On August 10, 2017, amidst ongoing negotiations, the retirement committee "met and discussed the impact of [union] extra duty [pay] on the [retirement plan]. [The] town chief financial officer, Lawrence Hutvagner, informed the [retirement committee] that, while third party entities reimbursed the town for extra duty pay, extra duty was a liability of the [retirementplan]. The [retirement committee] members then unanimously voted to have the town attorney clarify whether extra duty pay was properly included in [retirement plan] benefit calculations."

In an October 23, 2017 memorandum addressed to the retirement committee, the town attorney, Robert W. Smith, who was representing the town in the negotiations with the union, claimed that "[t]he definition of salary, as amended in 1995, in conjunction with the addition of [§] 7.2 (which vests conclusive plan interpretation in the [retirement committee]), certainly allows the [retirement committee] to vote, consistent with its interpretation, on the issue of whether the [retirement plan] includes/excludes extra duty pay in/from pension calculations, going forward." Smith averred that the 1995 change to the definition of salary "is significant, inasmuch as extra duty pay, although always 'received from' the town, was always 'paid' by private parties.

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The fact that the money is passed...