Arbitrator’s Reinstatement of Police Officer Vacated Under Rare Public Policy Exception

The Minnesota Court of Appeals recently denied reinstatement to a Minnesota police officer by reversing an arbitration award that was deemed contrary to public policy.

This marks only the second time that the Court of Appeals has vacated an arbitration award reinstating a police officer, and signals a possible basis for challenging arbitration awards despite a long-standing judicial deference toward them.

Great Deference For Arbitration Awards

A long-standing tenant of labor arbitration is that the arbitrator is the final judge of both fact and law, and that in the absence of fraud, an arbitrator’s award will not be set aside due to a mistake of either fact or law. In furtherance of this principle, Minnesota Courts have ruled that every reasonable presumption must be exercised in favor of the finality and validity of arbitration awards.

Recently, however, the Court of Appeals deviated from this long-standing precedent when reviewing the case of a terminated Richfield Police Officer.  The officer was fired for striking an individual of Somali descent during an encounter and later failing to report this use of force in violation of Department policy.

After the officer’s labor union challenged the termination at arbitration, the arbitrator ruled that the officer did not engage in excessive force and that his failure to report the use of force was merely a “lapse in judgement.” The arbitrator ordered the officer be reinstated and reduced the termination to a three-day unpaid suspension.

The Public Policy Exception is Historically Narrow

The City of Richfield challenged the arbitration award alleging that it should be vacated as contrary to public policy.  Despite the strong policy favoring the validity of arbitration awards, Minnesota has recognized a limited exception for arbitration awards to be vacated if they are contrary to a “well-defined and dominant public policy.” Historically, the critical question was not whether the award (and not the underlying conduct) violated an established public policy.

The public policy exception is a narrow one and the Minnesota Supreme Court has only weighed in on it in just one other case.  There, the State Auditor at the time (current Minnesota Governor Mark Dayton) fired three auditors for falsifying expense reports.  An arbitrator ordered the auditors to be reinstated and subsequent appeals to vacate the award proved fruitless.

The Minnesota Supreme Court explained that although there was “a well-defined and dominant public policy against the embezzlement of state funds by public employees,” the public policy exception did not prohibit the arbitrator from finding mitigating circumstances to permit reinstatement. In other words, even though the employees’ actions were contrary to public policy, the award reinstating them was not.

The Court’s Public Policy Has Dubious Grounds

In the current case, the Supreme Court cited a well-defined and dominant public policy arising out of the Minnesota Rule requiring that all police officers hold licenses pursuant to the Minnesota Board of Peace Officers Training and Standards (POST), That rule states that “it is paramount that peace officers demonstrate that they are capable of self-regulation.” The Court therefore determined that failing to vacate the award reinstating the officer “would violate a well-defined and dominant public policy by jeopardizing public safety and undermining public trust in law enforcement.”

In short, the Minnesota Supreme Court announced that public policy demands that police officers incapable of self-regulation must not be returned to work.

Bottom Line

While the impact of this decision remains to be seen, it could usher in a renewed vigor in seeking to invalidate arbitration awards in Minnesota, especially those involving public employees covered by the Public Employment Labor Relations Act. The “well-defined and dominant public policy” requirement has traditionally been a high bar to meet but perhaps that bar has been lowered just a bit.

On the other hand, there may be some question as to whether the public policy cited here is in fact “well-defined and dominant” and an appeal to the Minnesota Supreme Court could be forthcoming.  It won’t be long until we know for sure.