The Supreme judicial court upheld an arbitrators award to restore wages and other benefits voluntarily given up by the police union on January 6th. In City of Lynn v. Lynn Police Association No. SJC-10422, the city of Lynn attemoted to have the arbitrators award overturned citing their belief that the award violated the Bailout grant provisions.
The court stated “We granted further appellate review to decide whether the arbitration award in this case should be vacated. In his award, the arbitrator ordered the city of Lynn to restore wages and other benefits voluntarily relinquished by the members of the Lynn Police Association (union)  pursuant to a memorandum of agreement that modified the then-existing collective bargaining agreement between the parties. The city filed a complaint in the Superior Court requesting declaratory relief and seeking to vacate the arbitration award. The union filed an answer and a counterclaim requesting confirmation of the award. The city moved for summary judgment and the union moved for a judgment on the pleadings. A Superior Court judge denied the city’s motion, allowed the union’s motion, and entered a judgment confirming the award. The city appealed, and the Appeals Court essentially affirmed the judgment of the Superior Court (the Appeals Court ordered modification of the judgment to reflect a declaration of rights). See Lynn v. Lynn Police Ass’n, 73 Mass.App.Ct. 489, 495-496 (2009). On the grant of its application for further appellate review, the city argues that we vacate the award, contending that compliance with it would violate a State statute, namely, the so-called “Lynn Bailout Act,” see St.1985, c. 8 (Bailout Act), and that the arbitrator exceeded his authority in ordering payment to the union. For reasons different from those stated by the Appeals Court, we affirm.
The city and union negotiated a collective bargaining agreement for the period July 1, 2001, through June 30, 2004(CBA), that governed employment and compensation, and provided for binding arbitration of grievances.  As a result of a reduction of aid to the city from the State in fiscal year (FY) 2004 (June 30, 2003, through June 30, 2004), the city and union entered into a memorandum of agreement (MOA) on October 1, 2003, that temporarily and conditionally modified the CBA for FY 2004. Pursuant to the MOA, the union agreed to relinquish (in FY 2004 only) certain wages and benefits in the amount of $290,360 (concessions),  to avoid layoffs, on the condition that the city would restore the concessions if it received additional funds from the State or Federal government.  The MOA saved the city $290,360, and there were no layoffs in the police department.
In December, 2003, the Lynn police department received a “community policing” grant in the amount of $277,815 from the Massachusetts Executive Office of Public Safety (EOPS) for FY 2004. Under the program, grant funds were to supplement, and not supplant, local police department budgets. While grant funds could only be used for “community policing,” the funds could be used, at the discretion of the chief of police, to defray personnel costs; to defray costs of training law enforcement and civilian personnel; for overtime; for supplies, operating expenses, and equipment; and to defray other reasonable costs intended to facilitate or enhance community policing. In light of these permitted uses of the grant funds, the arbitrator concluded, and the city does not challenge this conclusion, that the grant “was for all intents and purposes unrestricted.” Taking note of the fact that the FY 2004 budget was in place when the grant was received, and that there was no change in the budget as a result of the grant, the arbitrator further concluded (and, again, the city does not challenge this conclusion) that the grant funds were used to supplement the department’s budget for FY 2004. The city did not use the grant funds to repay the union members for the MOA concessions, but did expend all the grant funds in FY 2004. 
The union became aware of the grant funds in February, 2004, and requested termination of the MOA and use of the grant funds to repay the MOA concessions. The city refused and the union filed a grievance that led to the underlying arbitration proceeding. 
The arbitrator found that, by failing to restore the concessions to the union members after receiving the grant funds, the city had violated the MOA. He rejected the city’s claim that restoring the concessions would violate the Bailout Act, noting that it would be up to the city to decide how to comply with the MOA without violating the Bailout Act. He ordered that the city “must comply with the [MOA] by repaying the bargaining unit employees up to the amount of the grant,” and retained temporary jurisdiction to resolve any questions concerning the remedy.
The City essentially got greedy. The Union agreed to concessions that would save jobs and money but when additional money came in it decided to take that on top of the concessions and disregard prior agreements with the Union.
Attorney Ronald A. Sellon