Alaska Employment Law

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Court again punts standard of review issue

The Alaska Supreme Court has affirmed arbitration awards made by William Dorsey and Janet Gaunt.  Though granted about 1 1/2 yeas of back pay, the APEA-represented state employee was dissatisfied and pursued challenges to the awards and an independent action pro se. 

Superior Court Judge Patricia Collins of Juneau consolidated the employee’s various cases, and then dismissed them on the merits.  The Supreme Court, per Justice Carpeneti, unanimously affirmed Collins.

Background

The State dismissed employee Steve Baseden, an Engineer/Architect III, in the 13th month of his probationary period.  Baseden sued.   Superior Court Judge Larry Weeks held that the State could not extend the statutorily-limited 12-month probationary period and ordered the State to reinstate Baseden and accept a grievance about the dismissal.   Baseden refused the State’s reinstatement offer, and the State challenged the arbitrability of Baseden’s grievance.  The State then dismissed Baseden a second time, for failing to appear for reinstatement. 

In the first of two arbitrations that followed, William Dorsey held that the State had “just cause” to fire Baseden for not appearing in response to the reinstatement offer.  Then, Janet Gaunt awarded damages to Baseden for the original dismissal (after the State conceded error) up to the time of the rejected reinstatement offer, and attorney fees to APEA for a collateral fight on arbitrability.

The holdings 

The Supreme Court held as follows:

1) Standard of review:  For the umpteenth time, the Court found it unnecessary to decide the standard for reviewing a compulsory grievance arbitration award: is it the highly deferential “gross error standard” or the less deferential “arbitrary and capricious” standard?  For each of the issues challenged by the employee, the Court held that the award met the less deferential (”arbitrary and capricious”) standard. 

2)  Rejection of reinstatement offer as just cause for discharge: Dorsey held that Baseden’s distrust of the State regarding an offer of reinstatement was unwarranted - though the new job had a different PCN, it had the same duties and pay.  The Court affirmed the Dorsey award under the “a&c” standard, noting Dorsey’s attention to the facts, etc. 

The only noteworthy addition to the usual comments made by an award-affirming court is this court’s reliance on the second arbitrator’s favorable view of Dorsey’s award:

The Dorsey decision is further supported by the Gaunt decision, in which Arbitrator Gaunt ruled that deference to Arbitrator Dorsey’s decision was warranted under the circumstances because Baseden received a full and fair prior hearing and Arbitrator Dorsey issued a clear and well-reasoned opinion.

Op. at p. 10.

3)  Damages for denial of arbitrability:  After Judge Weeks had ordered the State to process a dismissal grievance, the State challenged the arbitrability of Baseden’s first dismissal grievance before the ALRA.  The ALRA ruled in favor of Baseden/APEA, and the Superior Court affirmed.  APEA as well as Baseden sought damages in the arbitration before Janet Gaunt. 

Gaunt held that backpay ended with Baseden’s refusal of the reinstatement offer (deferring to Dorsey’s earlier award) and awarded APEA attorneys fees for work before the ALRA (who held that the State had unjustifiably forced APEA before the ALRA) , awarded Baseden back pay (with interest), but declined to award him emotional distress and punitive damages. 

The Supreme Court, again, held that Gaunt’s damages awards, including that to APEA for the ALRA work, were not arbitrary and capricious.

4)  Fraud in arbitrations:   Baseden argued that the State’s reinstatement offer was fraudulent.  The Court ruled:

Baseden’s allegations of fraud seem to misunderstand our case law.  Instead of alleging fraud on the part of the arbitrator or fraud within either the Dorsey or Gaunt arbitration proceedings, Baseden’s fraud allegations center on the actions that the state took in offering reinstatement to Baseden in October.  Because all of the facts that Baseden alleged were part of the record considered by the arbitrators, there is no fraud-based reason for this court to overturn the arbitration decisions.

Op. at p. 16.

Baseden v. State of Alaska, 2007 WL ________ (Alaska Jan. 4, 2008). 

Baseden was pro se.  William Milks of the Juneau AG’s office represented the State.