The Dills Act Prevents An Arbitrator From Reforming An Erroneous Memorandum Of Understanding After It Has Been Ratified

Department of Personnel Administration v. California Correctional Peace Officers Association (2007) ______ Cal.App.4th _______; (07 C.D.O.S. 7741, filed June 29, 2007)

Although this case arises under the Dills Act, California Government Code section 3512, et seq., the rationale of the Court of Appeal could be applied to any arbitration occurring between most public sector employers and unions representing their employees.  The California Correctional Peace Officers Association entered into a collective bargaining agreement with the State of California by and through its agent, the Department of Personnel Administration.  A dispute arose concerning the “release time bank” established under the contract.  The precise nature of the dispute is not relevant.  What is relevant is that there appeared to be an error in the published memorandum of understanding which caused that published document to not reflect the intent of the parties.  The union brought the dispute to the grievance procedure and ultimately to arbitration.  The arbitrator ordered that the memorandum of understanding be reformed to reflect the intention of the parties.  The Court of Appeal acknowledged that generally arbitrators do have the ability to reform contracts even when the contracts restrict the arbitrator from altering or amending the language of the contract.  However, in the instant case under the Dills Act the memorandum of understanding must be ratified by the Legislature.  The Court held that once the Legislature had approved the memorandum of understanding, it may not be reformed without further legislative ratification.

As of the date of the preparation of this note, a petition for review was pending before the California State Supreme Court.