2008 VT 58


In re Grievance of Cole
(2006-472)
 
2008 VT 58
 
[Filed 02-May-2008]
 
NOTICE:  This opinion is
subject to motions for reargument under V.R.A.P. 40
as well as formal revision before publication in the Vermont Reports. 
Readers are requested to notify the Reporter of Decisions, Vermont Supreme
Court, 109
  State Street, Montpelier, Vermont05609-0801
of any errors in order that corrections may be made before this opinion goes to
press.

 
 

2008 VT 58

 

No. 2006-472

 

In re Grievance of Mary Ellen
  Cole and 


Supreme Court


Charles Cross


 


 


On Appeal from


     


Labor Relations Board


 


 


 


October Term, 2007


 


 


 


 


Richard
  W. Park, Acting Chair


 
Jes
  Kraus, Associate GeneralCounsel,
  Vermont State Employees’ Association, Montpelier,
  for
  Appellants.

 
William H. Sorrell, Attorney General, and Bridget C. Asay, Assistant Attorney General,
  Montpelier, for Appellee.
 
 
PRESENT:  Reiber, C.J.,
Dooley, Johnson, Skoglund and Burgess, JJ.
 
 
¶ 1.            
BURGESS, J.   Grievants Mary
Ellen Cole and Charles Cross appeal a decision of the Vermont Labor Relations
Board dismissing their grievance over the Department of Corrections’
application of the State’s conflict-of-interest personnel policy to the
parties.  The policy prohibits Cole from working on the same shift as her
partner, Cross, who would be supervising Cole if they were so assigned. 
The Board concluded that the personnel policy was a past practice embedded in grievants’ collective-bargaining agreement, and that it did
not conflict with language in the agreement governing the distribution of
overtime and shift-bidding.  As such, the policy applied to grievants and restricted the shifts that grievant Cole
could work.  We affirm.
¶ 2.            
Grievants, domestic partners since 2001, both
work at Northwest State Correctional Facility (NWSCF).  Cross works as a
correctional facility shift supervisor (CFSS), a position he has held since
1999.  In this capacity, he is “responsible for security operations” in
the prison and “addresses security and staff performance concerns that may
arise during the shift.”  Cross directly supervises employees designated
as correctional officer II (COI II); COI IIs in turn
supervise employees designated correctional officer I (COI I).  Both COI
Is and COI IIs are “subject to direction and
supervision” from the CFSS on duty, and may receive performance feedback from
the CFSS.  Cole began work as a COI I at NWSCF in June 2000.  
¶ 3.            
Both grievants are employed pursuant to a
collective-bargaining agreement (the contract).  Article 2 of the contract
governs “Management Rights”:  
subject to terms
set forth in this Agreement, nothing in this Agreement shall be construed to
interfere with the right of the Employer to carry out the statutory mandate and
goals of the agency, to restrict the State in its reserved and retained lawful
and customary management rights, powers, and prerogatives, including the right
to utilize personnel, methods and means in the most appropriate manner possible. 

 
Article 20 provides that “[COI Is]
with more than three (3) years seniority . . . shall receive shift assignments
based on seniority.”  Article 28 governs the distribution of overtime, and
states that “[a]ppointing authorities shall make a
reasonable effort to distribute overtime as equitably as possible among
classified employees.”  
¶ 4.            
Also relevant to this dispute are the State personnel policies and
procedures governing conflicts of interest.  The State has had a
conflict-of-interest policy since 1966.  In its current form that policy
is embodied in personnel policy Number 5.2.  Number 5.2 sets forth “the
general policy of the State that no one will be employed in the same
department, institution, or organizational unit that employs a relative.” 
For purposes of the policy, the term “relative” includes spouses, civil union
partners, and domestic partners.  Employees may request a waiver so they
may be employed in the same department as a relative.  Waivers are submitted
to the Department of Human Resources, which evaluates each waiver based on a
number of factors, including the type of relationship, size of the department,
“reporting relationships within the organization,” and location of the
employer.  When a conflict of interest arises during employment, “the
employer must take all reasonable and practicable measures, including, but not
limited to, changes in supervision, work location, and/or work shift, to avoid
to the greatest extent possible the conflict or the appearance thereof.”  
¶ 5.            
Under Article 20 of Cole’s contract, she became eligible to bid for
shifts in the summer of 2003.  At that time, she had been working on the
third shift, while Cross was assigned to first shift.  Cole put in a
request to work on the first shift, and it was denied due to the conflicts
policy.  She then filed a grievance, but withdrew it before it was heard
by the Board.  
¶ 6.            
Cole then attempted to obtain a waiver from the Department of Human
Resources so she and Cross would be allowed to work the same shift.  In
2005, a waiver was issued, which allowed their continued employment at NWSCF,
but mandated that there be “no work contact between the employees,” that they
work “separate shifts at all times,” and that the two have “entirely separate
reporting relationships.”  Grievants
acknowledged this waiver, but maintained that it did not apply to them. 
At the next shift-bidding cycle, Cole again attempted to bid for work on the
first shift and was again denied her request.  
¶ 7.            
Cole, joined by Cross, grieved this denial to the Board.  They
challenged the denial of Cole’s request to work on the first shift and the
refusal to allow them to work overtime on the same shift, claiming the contract
provisions on shift-bidding preempted the conflicts policy.  The Board
held a hearing, and issued a decision dismissing the grievance.  The Board
found that, because the contract did not specifically address conflicts of
interest, the State’s conflict-of-interest policy was not superseded by the
contract terms.  Moreover, because the parties bargained with knowledge of
this conflict-of-interest policy, it was a “past practice implicitly embedded
in the contract.” 
¶ 8.            
Grievants appeal the Board’s decision to dismiss
their grievance, raising four contentions on appeal:  (1) the Board erred
in concluding that there was no conflict between the provisions of the
collective-bargaining agreement and the personnel policy; (2) the Board erred
when it found that the personnel rules are implicitly embedded in the contract;
(3) the Board’s decision contradicts the plain language of the contract; and
(4) the Board’s conclusion imposes an “insurmountable burden” on collective
bargaining in Vermont.  
I. 

¶ 9.            
We first address grievants’ claim that the
Board erred in concluding that no conflict existed between the terms of the
contract and the State personnel policy governing conflicts of interest. 
“Interpretations of collective bargaining agreements are within the particular
expertise of the Board, and we review such interpretations with great deference
to the Board’s expertise.”  In re West, 165 Vt. 445, 448, 685 A.2d
1099, 1102 (1996); see also In re Vt. State Employees Ass’n,
2005 VT 129, ¶ 7, 179 Vt. 228, 893 A.2d 333; In re Gregoire,
166 Vt. 66, 72, 689 A.2d 431, 435 (1996) (“Substantial deference must be
accorded the Board’s construction of collective bargaining agreements.”). 

¶ 10.        
Grievants cite In re Muzzy, 141 Vt.
463, 449 A.2d 970 (1982), in support of their claims.  In Muzzy, a
State employee challenged her dismissal, arguing that the State failed to
follow proper dismissal procedures when it fired her after several
unsatisfactory performance reviews.  The collective-bargaining agreement
provided that progressive disciplinary steps would be used before an employee
was dismissed.  The State, relying partly on its internal rules and
regulations for personnel administration, dismissed the employee without
progressive discipline, arguing that a dismissal for “inability to perform” was
not covered by the contract terms.   Id. at 474-76, 449 A.2d
at 975-76.  We rejected this argument, holding that because the contract
provision governing “dismissal” did not specify that it applied only to certain
types of dismissal, it applied to all dismissals.  Because the language of
the collective-bargaining agreement “clearly and unambiguously” addressed
dismissal procedures, its terms trumped the language of the State’s rules
regarding dismissals, and the State was required to follow the bargained-for
provisions.  Id. at 476, 449 A.2d at 976.
¶ 11.        
We reached a similar result in In re
Graves, 147 Vt. 519, 520 A.2d 999 (1986).  In Graves, an
employee was dismissed after he submitted fourteen false claims for
reimbursement for lunch expenses.  The employee argued that this dismissal
was improper because the State had an obligation to discipline him by
suspending his reimbursement privileges before it could dismiss him, and it had
not done so here.  He pointed to a provision in the State’s Standard
Operating Procedures that stated that the employer “shall revoke midday
meal reimbursement privileges where there is continuing indication of
abuse.”  Id. at 521, 520 A.2d at 1000.  The employee’s
collective-bargaining agreement, however, contained a provision addressing the
same issue, stating that the employer “may revoke midday meal
reimbursement privileges where there is continuing indication of abuse.”  Id.
at 522, 520 A.2d at 1001.  Invoking the rule established in Muzzy,
we held that “where the language of a collective bargaining agreement is clear
and unambiguous, employment rules and regulations promulgated unilaterally by
the employer-state which conflict with the contract terms are superseded by the
contract.”  Id.  As both the contract and the Operating
Procedures addressed the same issue, the contract language controlled; because
the contract did not mandate that the employer suspend expense privileges
before dismissal, the State could properly dismiss the employee without first
disciplining him.   
¶ 12.        
Both Muzzy and Graves focused on the language of the
contract, concluding that when a collective-bargaining agreement and an employer’s
personnel rules address the same topic, the bargained-for language of the
contract controls over the employer’s unilaterally promulgated rules. 
This rule provides no support to grievants’ argument
here because there is no conflict between the language of the contract and the
State’s conflict-of-interest policy.  The contract provisions at
issue—those establishing procedures for the distribution of overtime and
shift-bidding—do not cover the same subject matter as the contested personnel policy,
which addresses conflicts of interest in the workplace.  Accordingly,
there is no clash between the personnel policy and the contract, and we affirm
the Board’s interpretation of the agreement.
II.

¶ 13.        
Grievants’ next claim is that the Board erred
in concluding that the “personnel rules . . . were a past practice implicitly
embedded in the contract, where the parties bargained with the knowledge that
the personnel rules were applicable and no contract provision addressed the
applicable personnel rule.”  Generally, we look to the plain language of a
contract to discern the intent of the parties.  See In re Stacey,
138 Vt. 68, 71, 411 A.2d 1359, 1361 (1980).  We have held, however, that
an “implied contractual provision may arise through established past practices,
where the conduct of the parties . . . encompass[es]
a continuity, interest, purpose and understanding which elevates a course of
action to an implied contractual status.”  Gallipo
v. City of Rutland, 163 Vt. 83, 88, 656 A.2d 635, 639 (1994) (quotation and
citation omitted).  
¶ 14.        
In Gallipo, a senior firefighter
challenged the fire department’s decision to pass him over for a promotion,
arguing, inter alia, that he had been denied the promotion in violation of an
“implied contractual provision justifying an expectation of promotion based on
seniority.”  Id.  We recognized that such implied provisions
may arise, and looked to the past course of conduct at the firehouse regarding
seniority and promotions to ascertain whether the claimed past practice
existed.  Id.  We ultimately rejected the firefighter’s claim
because the course of conduct did not establish an implied contractual
obligation when some experienced firefighters had been promoted based on
seniority in the past, but others had not.  Id.  Such
inconsistent hiring practice evidenced no implied right to promotion based on
seniority alone.  Id.  
¶ 15.        
Although Gallipo did not arise in the
collective-bargaining context, this Court has similarly held that past practices
may be considered when interpreting a collective-bargaining agreement. 
See Milton Educ. & Support Ass’n
v. Milton Bd. of Sch. Trs.,
2003 VT 42, ¶ 8, 175 Vt. 531, 824 A.2d 605 (mem.) (an
arbitrator interpreting a collective-bargaining agreement may examine past
practices); Burlington Area Pub. Employees Union v. Champlain Water Dist.,
156 Vt. 516, 521, 594 A.2d 421, 424 (1991) (considering “textual interpretation
and . . . ‘contracts implied in fact’ in the form of established past
practices” to interpret provisions of a collective-bargaining agreement). 
Other courts have also recognized that past practices may become implied terms
in a collective bargaining agreement.  See Consol. Rail Corp. v. Ry. Labor Executives, Ass’n,
491 U.S. 299, 308 (1989) (recognizing that “collective-bargaining agreements
often incorporate . . . implied terms”); Bonnell/Tredegar
Indus., Inc. v. NLRB, 46 F.3d 339, 344 (4th Cir. 1995) (“An employer’s
established past practice can become an implied term of a collective bargaining
agreement.”).
¶ 16.        
The Board has long recognized this principle, holding that past
practices are “in essence . . . a part of the parties’ whole agreement.”  In re Beyor, 5 V.L.R.B. 222, 238
(1982).[1] 
Particularly relevant to the instant case are decisions where the Board has
held that personnel policies may become implied contractual provisions. 
In In re Allen, 5 V.L.R.B. 411, 418
(1982) the Board concluded that “[w]here . . . the parties have bargained with
the knowledge the Personnel Rules are applicable, [they] are a past
practice implicitly embedded in the Contract unless explicitly altered by the
Contract.”  The Board accorded similar status to personnel rules in In re Cronin, 6 V.L.R.B. 37, 67 (1983),
stating that “day-to-day practices mutually accepted by the parties may attain
the status of contractual rights and duties, particularly where they are long
standing and not at variance with contract provisions.”   Although
“Personnel Rules do not apply where a contract provision addresses the same
issue that is covered by the Personnel Rules,” where no contractual term
addresses the topic, the personnel rules remain in force.  Id. at
70.  
¶ 17.        
We agree with the Board’s approach, and here extend the Gallipo principle that past practices may give rise
to an implied contractual provision in the collective-bargaining context. 
This approach leads us in the present case to affirm the Board’s determination
that the State’s conflict-of-interest policy is embedded in the contract as a
past practice.  The State has had personnel rules governing conflicts of
interest in place since 1966, long before the parties negotiated the first
shift-bidding provision in 1984.  This policy has been enforced on a number
of occasions in the Department of Corrections.[2]  The parties bargained with the
knowledge of these conflict-of-interest policies, and the contract contains a
term—Article 2—recognizing the State’s rights to enforce such personnel
policies, yet nothing in the contract explicitly alters, or even addresses, the
application of the conflict-of-interest policy.  Given these factors and
the longstanding existence of, and important policy reasons underlying, the
State’s conflict-of-interest policy, see infra, ¶ 21, we affirm the
Board’s conclusion that the policy is impliedly embedded in the contract as a
past practice. 
III.

¶ 18.        
We next address grievants’ claim that the
Board’s conclusion contradicts the plain language of the contract.  Grievants contend that the provision governing
shift-bidding is unambiguous, granting these rights unconditionally to all
employees based on seniority, and that the personnel policy deprives them of
their contractual right to bid for shifts.
¶ 19.        
  We agree with grievants that
contractual terms are to be interpreted based on their plain meaning.  See
Congdon v. Auto. Club Ins. Co., 174 Vt.
586, 586-87, 816 A.2d 504, 506 (2002) (mem.). 
We look to the plain meaning of individual terms, but contract provisions “must
be viewed in their entirety and read together.”  In re Stacey, 138
Vt. at 72, 411 A.2d at 1361.  “The cardinal principle in the construction
of any contract is to give effect to the true intention of the parties.”  In
re Cronan, 151 Vt. 576, 579, 563 A.2d 1316, 1317
(1989).  To the extent that contract provisions are ambiguous, “the practical construction placed upon an instrument by
the parties would be controlling in determining the meaning of the instrument.” 
Id.  
¶ 20.        
Grievants correctly point out that Cole’s
right to bid for shifts and overtime is incidentally burdened by the
conflict-of-interest policy in this circumstance.  Determining the
parties’ intent with regard to these provisions thus requires a “practical
construction” of the contract, evaluating the context in which the parties
negotiated to determine the parties’ intent.  Here, the parties negotiated
Article 2, which recognizes the State’s right to promulgate and enforce
personnel policies necessary for managing the workplace, Article 20, which
governs shift-bidding, and Article 28, regarding overtime.  They
negotiated these terms under an overarching State personnel policy governing
conflicts of interest that had been in place for almost forty years, well
before the shift-bidding provisions were originally negotiated in 1984.  
¶ 21.        
Such a policy is vital to workplace management.  Because of the
problems long associated with “conflicts of interest and the appearance
thereof” in the workplace—including “real or perceived favoritism, negative
effects on employee morale, inadequate or inappropriate supervision, and
possible performance problems”—as a public employer, the State has an inherent
interest in establishing personnel policies to deal with these conflicts in the
workplace.  In the context of a correctional facility, these concerns are
particularly acute.  If inmates were to become aware that a close
relationship existed between two prison employees, they could manipulate one or
both of the individuals, resulting in potential danger to the employees or
other inmates.  The Board concluded that, in particular, a “security risk
would be created . . . if a supervisory relationship existed between
correctional officers who were domestic partners,” because “[i]f inmates physically endangered one partner . . . this
could have an effect on the judgment of the other partner in responding to the
situation.”  This conflict-of-interest policy has been enforced in the
corrections context numerous times.  See supra, n. 2. 
  
¶ 22.        
Despite this long-established and enforced policy in the Department of
Corrections, however, no provision in the contract addresses or purports to
modify the application of the policy.  Instead, the parties expressly
included Article 2, which recognizes the right of the State to apply such
personnel policies.  Given the institutionalization of the State’s
conflict-of-interest policy, the important management policy justifying its
enforcement, and the Board’s finding that “the parties bargained with the
knowledge that the conflicts of interest policy was applicable and no contract
provision addressed the policy,” we uphold the Board’s “practical construction”
of the instrument and reject grievants’
interpretation of the shift-bidding provision.  See Gregoire,
166 Vt. at 72, 689 A.2d at 435 (discussing the “[s]ubstantial
deference” which must be accorded the Board’s construction of collective
bargaining agreements).  
IV. 

¶ 23.        
Grievants’ last claim is that enforcing the
personnel policy would place an “insurmountable burden on the collective
bargaining process in Vermont” because in the future negotiators will have to
“review[] each and every policy maintained by the employer, and compar[e them] to all proposed contract language to
determine whether or not a conflict exists.”  We fail to see the
problem.  Today’s holding simply effectuates the contract negotiated by
the parties, acknowledging the longstanding personnel policies embedded in the
agreement and giving effect to the provisions of Article 2 that the employer
“reserved and retained” its “customary management rights, powers and
prerogatives . . . to utilize personnel, methods and means in the most
appropriate manner possible” in the workplace.  Because the contract
specifically includes this term and the conflict-of-interest policy had been in
force for nearly forty years and so was customary when the agreement was
negotiated, we presume that the negotiators understood its effect.  We do
not create extra work for parties by enforcing provisions they themselves
negotiated during the collective-bargaining process.  
           
Affirmed.  
 
 
 

 


 


FOR THE COURT:


 


 


 


 


 


 


 


 


 


 


 


Associate
  Justice

 





[1] 
The Board decisions referenced in this opinion are available at
http://www.state.vt.us/vlrb.


[2] 
The Board discusses six instances where the conflict-of-interest policy was applied
to other couples in the Department of Corrections.  Generally, the
Department of Human Resources approved waivers for these couples to continue
working together, provided that there was “no direct work contact between the[]
individuals,” and that they had “disparate work functions” and “different
supervisors.”  



