Court Rules in Contract Disputes

Court Rules in Contract Disputes

The state Supreme Court this week issued two decisions that addressed whether or not termination of employees would be subject to arbitration. In both matters, NJSBA argued as amicus curiae in support of the local school boards.

In one case, Pascack Valley Regional Bd. of Educ. v. Pascack Valley Regional Support Staff Assn., the employee worked under both an individual employment contract and the district’s collective bargaining agreement. At issue was whether the collective bargaining agreement required mid-year terminations of staff to be subject to arbitration—even though the employee’s individual contract did not require such a process. In both cases, NJSBA argued as amicus in support of the local school boards.

An earlier ruling by the Appellate Division of Superior Court held that the decision to terminate employment in this case was not subject to arbitration.

The high court, however, unanimously ruled that the protections of the collective bargaining agreement trump the provisions in a staff member’s individual employment contract. The court said the collective bargaining agreement’s definition of discipline was so general that it covered mid-year terminations; the document stated that “any dismissal and suspension” was considered a disciplinary action that could go to arbitration.

The state Supreme Court concluded that the termination of the custodian was a disciplinary decision subject to arbitration.

The case involved a custodian who made inappropriate and racially offensive remarks to students and another custodian. The board terminated the custodian according to the terms of his individual employment contract—but he successfully arbitrated his termination and received a 60-day unpaid suspension instead.

Non-Tenured Teacher A similar case also decided Oct. 29, Northvale Bd. of Educ. v. Northvale Educ. Assn., involved a non-tenured teacher terminated for performance reasons. The state Supreme Court was split 3-3, which allowed an earlier Appellate Division decision to be affirmed. The Appellate Division had upheld the board’s right to terminate the employee with 60 days notice, as required by the individual employment contract, without being subject to the grievance and arbitration provisions of the collective bargaining agreement.

Half of the court found no contract language to support grievance proceedings for mid-year terminations. The other half said the collective bargaining agreement was not clear, and, therefore any doubts should be resolved in favor of arbitration, as required by state law.

School boards need to be aware of the language of their individual employment contracts and collective bargaining agreements to understand what may occur after terminations. NJSBA recommends that boards consult with their attorneys before undertaking any mid-contract termination.