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Arbitrator: WFD Pension Ordinance Invalid, City Owes $2.6M

[CREDIT: Rob Borkowski] Mayor Joseph J. Solomon, with Warwick Fire Chief Peter McMichael, announces the decision of an arbitration ruling that a 2011 ordinance altering WFD pensions is invalid.

WARWICK, RI — On Tuesday, Warwick City officials learnedthat an ordinance doesn’t supersede a negotiated contract, and they paid anestimated $2.6 million for the lesson.

Arbitrator Michael C. Ryan ruled Warwick violated its contract with firefighters union Local 2748 IAFF by giving firefighters hired after July 1, 2012 a less generous pension plan, without negotiating it, and must compensate them an estimated $2.6 million.

The decision, filed March 18, concerns 45 firefightersplaced in the Tier II pension plan, said Mayor Joseph J. Solomon, who faultedformer Mayor Scott Avedisian for failing to negotiate the pension plan changeafter the Warwick City Council unanimously approved it in May 2011.

Solomon said the impact to the coming year’s budget would beabsorbed by a combination of cuts and a second year of increasing the City’stax rate to the state mandated maximum 4 percent property tax increase. Lastyear, he said, that resulted in a .56 cent increase to the tax rate.

Solomon said it was disheartening that, following theCouncil’s approval of the pension change, that Avedisian did not “followthrough” by negotiating the change in the firefighter’s contract. He noted thatsuch changes had been achieved with the police union contract and the municipalemployees contract.

According tothe decision, filed and signed by Ryan, attorney Vincent Ragosta, representingWarwick, and Joseph A. Andriole,president of the RI State Association of Firefighters, Avedisian and members ofhis administration refused to negotiate the issue, arguing that the Union hadwaited past the deadline to make a legitimate grievance.

Avedisian had his first meeting on the dispute with thenLocal 2748 President William Lloyd July 3, 2014, who raised the issue at thattime.

Following that meeting, Lloyd filed a grievance July 31,2014, to meet the contractual deadline for filing disputes. He also sent Armstrong a letter asking thatthe grievance procedure be held in abeyance until either party notified theother in writing that an impasse had been reached. Armstrong countersigned theletter under the word, ‘Agreed,” according to the facts outlined in the

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decision.

Shortly after, in September of that year, Warwick Fire ChiefEdmund Armstrong began negotiating the 2015-2018 contract, according to theaccount in the decision. Between September and August, the parties attempted toresolve the pension issue but remained at an impasse.

The union sent a letter to then City Solicitor PeterRuggierio Aug. 2, 2016 asking to go into arbitration for the pension dispute,but a City lawyer responded, telling the union that the grievance had expired,apparently contradicting Armstong’s earlier written agreement.

The union re-submitted the grievance Feb. 23, 2017, but thenew Fire Chief, James McLaughlin, denied it, stating the time had expired, thatArmstrong had no authority to stay the grievance deadline, and that the unionnever invoked interest arbitration on the pension issue while negotiating the2015-2018 contract.

Avedisian also denied the grievance on April 7, 2017, repeatingMcLaughlin’s reasons.

When reached Tuesday afternoon, Union attorney Joseph PenzaJr., of Olen & Penza LLP, noted the City had several opportunities tonegotiate the pension disagreement with Local 2748, which might have resultedin the City paying less than the ultimate ruling.

“They thought that ordinance would supersede the collectivebargaining agreement [contract] which is does not,” Penza said.

Avedisian did not respond to an email seeking his comment on the dispute. Bill Depasquale, Avedisian’s Chief of Staff at the time, and Solomon’s current chief of staff, replied to an inquiry about the issue, stating that he had not been part of the team working with the firefighter’s union at the time. Ruggierio has since left his position with the City.

While Penza said Avedisian did not seem serious aboutnegotiating the dispute, the City Council was also aware the issue was inquestion, because Lloyd warned them at an April 11, 2011 hearing that theordinance to make the pension change would not affect the contract.

“So they were warned. The Council was warned about this,”Penza said.

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In Ryan’s decision Tuesday, he wrote, “In general, arbitrators find it acceptable for a union to refrain from filing a grievance until the employer actually implements the announced change.” It would waste time for a union to file a grievance whenever a change was announced, he reasoned, before it takes effect, if at all.

Also, he wrote, Armstrong’s agreement to forgo the timelimit on the grievance was an exercise of discretion by a management officialthat is both standard and common.

“Since the two-tier [pension] plan under the CBA [contract]violates the CBA, we find for the union on the merits of the issue,” the rulingreads. The remedy, the ruling states, requires ceasing the two-tier pensionsystem and to “make whole all affected members of the bargaining unit.”

“This issue has spanned over the course of 8 years, and we are happy to have a definitive resolution in order to move forward. It would have been our preference to have had a harmonious, mutually beneficial agreed upon resolve,” according to a statement from Local 2748 Treasurer Brandon Ingegneri.

Ragosta noted in his dissent that the union’s failure to act promptly after the 2011 amendment vote, which Lloyd witnessed. “In all events, the Union was well aware that the City adopted the pension funds amendments and must be deemed to have consented to such adoption by virtue of its inaction.”

Ragosta warned that the consequences of the win will prove apyrrhic victory.

“Ironically, the financial fallout of the panel’s decision will not help the union, as the City’s ability to pay for salaries, health care and various other direct and indirect components of firefighters total compensation will be subsequently impaired by the estimated $2.4 million impact of the cease-and-desist and make-whole awards.”

A full copy of the ruling, as well as the full statement from Local 2748, are embedded below:

Author: Rob Borkowski

Rob has worked as reporter and editor for several publications, including The Kent County Daily Times and Coventry Courier, before working for Gatehouse in MA then moving home with Patch Media. Now he's publisher and editor of WarwickPost.com. Contact him at editor@warwickpost.com with tips, press releases, advertising inquiries, and concerns.