Repudiation excuses exhaustion of remedies.

Byline: David Ziemer

When a municipal employer repudiated a collective bargaining agreement (CBA) by refusing to process a grievance, the employees are not required to exhaust contractual remedies before filing suit, the Wisconsin Court of Appeals held on June 3.

The court further held that, in such a case, the statute of limitations begins to run when the municipality notified the union representative that it would not answer the grievance, and that Chapter 109 applies.

Finally, the court held that a retroactive pay increase in a CBA applies to employees who are no longer employed.

Brenda Beaudette, Teresa Col'on, and Mitchell Lang all worked for the Eau Claire County Sheriff's Department until February or June 1998. They were members of the municipal employees' union and worked under the terms of CBAs.

After one of these agreements expired on Dec. 31, 1995, its successor was not negotiated until July 1998. The new agreement provided for increased wages and made the increases retroactive. All employees still employed received retroactive wages.

However, on Aug. 5, 1998, the county personnel committee denied retroactive pay to employees who had stopped working for the department during the negotiations. On Sept. 25, the union filed a grievance requesting back pay on the employees' behalf.

On both Sept. 30 and Oct. 7, the department sent the union correspondence stating that it believed the employees lacked standing to grieve. The union notified the affected employees of the department's stance on Oct. 10 and did not take any further action on the employees' behalf.

On July 10, 2000, the employees filed a notice of claim pursuant to sec. 893.80. On Dec. 29, 2000, they commenced a Chapter 109 wage claim. Both parties moved for summary judgment.

Eau Claire County Circuit Court Judge Eric J. Wahl awarded the back pay, concluding the employees did not have to exhaust their remedies under the CBA, because the department had refused to allow their grievance to proceed. The court also held that the two-year statute of limitations did not begin to run until Oct. 10, 1998, when the union representative informed the employees their grievance had been denied.

The court further determined the statute of limitations was tolled by 120 days because the employees filed a notice of claim under sec. 893.80.

The court also awarded $7,872 in back pay. Finally, the court determined that Chapter 109 applied to the employees' claim, although it refused to award penalties allowed under that chapter and reduced the employees' claimed attorney fees from $14,087 to $9,500, and awarded costs of $2,312.

Both parties appealed, but the court of appeals affirmed in a decision by Judge Thomas Cane.

Exhaustion of Remedies

The court first held that the employees were not required to exhaust their contractual remedies before filing suit in court.

Under the parties' CBA, grievances involving the interpretation or application of the CBA must be submitted to the personnel director, who then presents the dispute to the personnel committee. After the committee has made a decision, either party may take the grievance to arbitration by the Wisconsin Employment Relations Commission.

However, when the employer's conduct amounts to a repudiation of the collective bargaining agreement, the employee may proceed directly against the employer in court. Vaca v. Sipes, 386 U.S. 171, 185 (1967).

Here, the evidence of repudiation was the correspondence with the union, stating, "The county maintains that since neither the union nor the former employees have standing under Article 5 to grieve this matter, the county will not answer the grievance and will not process any further."

Also, in the Oct. 7 letter, the director informed the union representative the matter would not be placed on the next personnel meeting agenda.

The court rejected the department's argument that the statements were merely part of the "give and take of day to day labor relations," and held that the...