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City of Cranston v. International Brotherhood of Police Officers2/11/2005
awarded the pension escalation clause that the union was proposing to all of the town's police retirees regardless of the date they retired. Id. The town sought to have that portion of the award vacated on the basis that retirees were no longer members of the bargaining unit and therefore not represented by the union. Id. Rejecting the town's argument, our Supreme Court noted that, " n Rhode Island both the General Laws and decisional law explicitly authorize the modification of pension benefits" and that "an arbitration panel may adopt a cost-of-living increase for retired police officers when consistent with the state statute." Id. at 1105-06. The Court went on to declare, "The interest arbitrators for the parties can do anything that the parties could have agreed to do." Id. at 1106.
In the present case, it is indisputable that the relevant parties agreed to bargain over retiree benefits. Here, the City and Unions made a joint decision to contract on the permissive subject of retirees' pension benefits. Mayor Traficante in his unrebutted testimony admitted that he sent notice to the respective bargaining representatives for the police and fire unions that their municipal pension systems were in financial crisis. Additionally, he testified that both the police and fire unions entered into "voluntary negotiations with the City regarding retirement benefits in an effort to relieve the City's financially strained police and fire pension system." Although the City was not obligated to bargain on the subject of benefits for all existing retirees, the Mayor, for better or worse, chose to bargain on this permissive subject. The impetus for entering this previously uncharted territory was the Unions' assent to placing all new hires in the State pension system as opposed to the City's private pension system, commencing July 1, 1995. Pursuant to their bargaining, the City and the Unions agreed to include all retirees in the amended escalation clause. As Arbitrator Denaco declared when issuing his award:
"The very benefits [the City] talks about are in the contract. . .Once those benefits were carried over to and appeared in the CBA, they became subject to the grievance and arbitration provisions of the contract under Articles/Sections 22 and 23. The issue of whether the retired employees were ever 'vested' with these 'additional' and 'gratuitous' benefits is immaterial; starting in 1994-97 . . . and continuing through the current CBA, these benefits were a matter of contract." (Denaco Award at 17).
It is apparent to this Court that the City cannot now abandon its contractual duties to provide retirees with the pension benefits it promised in collective bargaining agreements because the City regrets its decision to bargain on this matter.
Furthermore, this Court finds the City's reliance on Webster v. Perotta, 774 A.2d 68 (R.I. 2001), unavailing. In Webster, the Rhode Island Supreme Court heard an appeal by the Town of Johnston from several default judgments that had been entered in favor of four retired police officers who had received disability retirement pensions from Johnston. Id. The Supreme Court vacated substantial portions of the default judgments, noting that G.L. 1956 § 45-19-1 provided benefits only "to police officers, firefighters and other public safety personnel who are actually employed when they suffer the disability and are paid the compensation provided by the [injured-on-duty] statute." Id. at 80. The Court went on to state that § 45-19-1 is not a retirement act and is applicable only to the public safety personnel enumerated in the statute who are "'regularly employed at a fixed salary or wage' and does not include retirees of these departments." Id. at 81.<
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