Arbitrator Rules That Peabody Police Association May Enforce Past Practice Of Working Outside Jobs

An arbitrator has ruled that the Peabody Police Chief violated the past practice clause of a collective bargaining agreement and his own department rule when he unreasonably denied the request of a local union official to work as a reserve officer in another town. This arbitration victory highlights the benefits of having past practice clauses inside labor contracts.

For years, Peabody officers worked any outside job they wanted, so long as the job did not conflict with their police duties. Peabody officers worked successfully as athletic coaches, small business owners, and even police officers in other communities. The Chief even issued a department rule permitting officers to work outside jobs so long as they obtained his permission.

This longstanding and consistent practice suddenly changed when the vice president of the Peabody Police Benevolent Association, MCOP Local 351, AFL-CIO asked to work as a reserve officer in another town (a position he used to hold prior to accepting a full-time appointment in Peabody). The Chief denied the request without explanation. Later, the Chief provided new and different reasons every time he was asked to explain his handling of the request.

The Association grieved the Chief’s actions (it also filed a charge of unfair labor practice). While the Agreement contains no specific clause entitling officers to work outside employment, it does contain a “past practice” clause: “Employee benefits, privileges or working conditions existing prior to this Agreement not specifically covered by this Agreement shall remain in full force and effect.” It also has a broad definition of grievance. The practical benefits of broad arbitration and past practice clauses are very real: parties can settle workplace disputes in a relatively quick manner. As the arbitrator observed, “It is difficult to envision what type of dispute would be excluded from the grievance procedure.”

Following a hearing, the arbitrator credited the Association’s testimony and nearly rejected every argument and fact raised by the City. Over the City’s objections, the arbitrator found that he had the authority to resolve the grievance under the past practice clause. The Arbitrator refused to be cowed by assertions of management rights. Instead of finding that Management Rights language serves as a magic wand for employer actions, the arbitrator found that the Chief is obligated to exercise managerial authority in a non-arbitrary, non-capricious, and reasonable manner. The Chief here failed to do so.

The arbitrator rejected practically each and every defense asserted by the Chief. He rejected the fanciful claim that the Association and Chief previously agreed that officers could not work for other police departments. The arbitrator wrote, “There is no reliable evidence that the City notified the Union of its intent to discontinue the practice of allowing full-time City police officers to work as reserve officers in other communities” (emphasis added),

The arbitrator further found that the bizarre reasons cited by the Chief (e.g., training, liability, etc) to prohibit the Association official’s request to work as a reserve officer basically were bogus. He wrote, “There was no evidence that the Chief’s concerns were rooted in fact.

Most damning of all perhaps is that the arbitrator found that the Chief fundamentally mishandled the officer’s request to supplement his income. The Chief failed to conduct a “reasonable inquiry” into the officer’s request, failed to raise any legitimate concerns, and failed even to talk to the officer, union and outside employer about any obstacles to working an outside job. In sum, the arbitrator found that the Chief abused his discretion in denying a request for no verifiable reason and therefore violated the collective bargaining agreement. For a remedy, the arbitrator ordered the chief to let the officer accept employment as a reserve officer for another town.

Download the decision

SJC Hands Rare Defeat To Chief – Personal Use Of Town Vehicle Does Not Count Toward Retirement

The Supreme Judicial Court has ruled that a public employee’s personal use of a municipal vehicle, which also is used for official purposes, does not count as “regular compensation” for purposes of retirement. The decision ( is Pelonzi v. Retirement Board of Beverly, SJC-10098 (May 21, 2008.

The retirement allowance of public employees generally is based upon a percentage of the “regular compensation” paid to employees. “Regular compensation” generally includes base wages and other wage enhancements, such as specialty stipends and shift differentials, and excludes (contrary to media reports) overtime and details. Over the years, the Public Employee Retirement Administration Committee has held changing positions on whether the personal-use value of an employer-supplied vehicle qualifies as “regular compensation.”

In the case of Bulger v. Contributory Retirement Appeal Bd., 447 Mass. 651 (2006), the SJC ruled that housing payments paid to former UMass President William Bulger counted as “regular compensation” and ordered that these payments be figured into his retirement allowance. This decision naturally led many persons to conclude that all knowing personal use of a company vehicle qualified as “regular compensation.” The SJC’s decision now disabuses legal practitioners of this notion and reminds us that William Bulger’s case exists in a special class by itself.

The court agreed that “the personal use value of the city-supplied automobile [qualified] as a “regular” benefit, in the sense that it was recurring and not incurred as a bonus or in lieu of payment for special services.” This same benefit, however, did not qualify as “compensation . . . for the individual service” of the employee as that phrase is defined under General Laws Chapter 32, §1. Under the SJC’s analysis, a benefit qualifies as compensation apparently to the degree that the employee doesn’t need the benefit. To wit, Bulger didn’t really need a housing allowance, so it really serves as a financial incentive to him. Whereas, vehicles for public safety executives are “required by the fundamental nature” of the job. As the SJC wrote, “Employers routinely supply employees with other noncash job related accessories and benefits (e.g., cellular telephones, personal computers, facsimile machines, parking spaces) to enable their employees to perform their jobs more efficiently, and may authorize the personal use of these benefits as a matter of convenience.”

Therefore, personal-use value of a company car is unlikely to count toward public employee retirement in Massachusetts unless the employee can show that a written agreement with the employer provided a company vehicle as an enticement for the employee to improve his or her performance and that the employer could take away the vehicle (for either personal or official purposes) as a result of underperformance.