A05-1061

Education Minnesota-Aitkin,

Appellant,

vs.

Independent School District No. 1,

Aitkin, Minnesota,

Respondent.

Filed April 25, 2006

Affirmed

Willis, Judge

Aitkin County District Court

File No. C3-04-834

Rebecca H. Hamblin, Education Minnesota, 41 Sherburne Avenue, St. Paul, MN 55103 (for appellant)

Maggie R. Wallner, Kennedy & Graven, Chartered, 470 U.S. Bank Plaza, 200 South Sixth Street, Minneapolis, MN 55402 (for respondent)

Considered and decided by Willis, Presiding Judge; Stoneburner, Judge; and Collins, Judge.*

U N P U B L I S H E D O P I N I O N

WILLIS, Judge

Appellant challenges the district court’s order denying its motion to compel arbitration. Because we conclude that the matter in dispute was not within the scope of the arbitration agreement, we affirm.

FACTS

Joyce Ferrari works for respondent Independent School District No. 1, Aitkin, Minnesota (the district). She was a fifth-grade teacher during the 2002-03 school year and then worked as an “itinerant teacher,” tutoring children at the elementary school during the 2003-04 school year. Ferrari took a paid administrative leave effective in April 2004, as the district investigated complaints regarding her classroom conduct. While the investigation was pending, Ferrari received a letter from the district’s superintendent informing her of her new position as a “student assistance provider” at the high school should she be returned to her employment the following school year.

Appellant Education Minnesota-Aitkin (Education Minnesota) filed a grievance on behalf of Ferrari after she received notice of the reassignment. The district’s collective bargaining agreement (CBA) provides a grievance procedure that includes the right to arbitrate certain disputes. Education Minnesota claims that Ferrari’s reassignment violated a number of provisions of the CBA, including the discipline-without-just-cause and transfer clauses. Education Minnesota’s grievance stated that the reassignment was a demotion to a non-teaching position, was disciplinary in nature, and was illegal because Ferrari does not have a high-school teaching license. Education Minnesota sought to arbitrate this dispute, but the district concluded that Ferrari’s grievance was not covered by the CBA.

Education Minnesota filed a motion to compel arbitration. The district court denied the motion, and this appeal follows.

D E C I S I O N

Education Minnesota argues that the district court erred by denying its motion to compel arbitration and asserts that the district court erroneously ruled on the merits of Education Minnesota’s grievance. This court reviews de novo district court decisions regarding the arbitrability of disputes. Minn. Teamsters Pub. & Law Enforcement Employees’ Union, Local # 320 v. County of St. Louis, 611 N.W.2d 355,358 (Minn. App. 2000). Minnesota’s arbitration statute requires a district court to order parties to proceed to arbitration when a party shows an agreement to arbitrate and the opposing party’s refusal to arbitrate. Minn. Stat. § 572.09(a) (2004). Therefore, “[w]hen considering a motion to compel arbitration, the court’s inquiry is limited to (1) whether a valid arbitration agreement exists, and (2) whether the dispute falls within the scope of the arbitration agreement.” Cmty. Partners Designs, Inc. v. City of Lonsdale, 697 N.W.2d 629, 632 (Minn. App. 2005) (quotation omitted).

In a judicial proceeding to compel or stay arbitration, the district court must ascertain the intention of the parties from the language of the arbitration agreement. Local No. 1119, AFSCME v. Mesabi Reg’l Med. Ctr., 463 N.W.2d 290, 295 (Minn. App. 1990). If there is no agreement to arbitrate or if the dispute is not within the scope of the contract’s arbitration clause, the district court may protect a party from arbitration. Cmty. Partners Designs, Inc., 697 N.W.2d at 632. But if the scope of the arbitration agreement is reasonably debatable, “the issue of arbitrability is to be determined initially by the arbitrator.” Id. Here, Education Minnesota argues that the district court should have granted its motion to compel arbitration because (1) it is at least reasonably debatable that the CBA contains an agreement to arbitrate teacher transfers; and (2) teacher discipline is within the scope of the CBA’s arbitration agreement, and it is reasonably debatable that Ferrari’s reassignment was disciplinary in nature.

Education Minnesota argues that the CBA provides for arbitration of transfers when the district fails to consider the transfer criteria listed in the CBA. The CBA provides that “[t]he arbitrator shall have jurisdiction over disputes or disagreements relating to grievances properly before the arbitrator pursuant to the terms of this procedure.” Art. XIV, sec. 7, subd. 6. A grievance is defined as “a claim by a teacher . . . resulting in a dispute that there has been a misinterpretation or misapplication of terms and conditions of employment insofar as such matters are contained in this Agreement.” Art. XIV, sec. 1.

The CBA does not define “terms and conditions of employment,” but it does provide that “[t]erms not defined in this Agreement shall have those meanings as defined by the P.E.L.R.A.” Art. III, sec. 3. The Public Employment Labor Relations Act (PELRA) defines “terms and conditions of employment” as:

the hours of employment, the compensation therefor including fringe benefits except retirement contributions or benefits other than employer payment of, or contributions to, premiums for group insurance coverage of retired employees or severance pay, and the employer’s personnel policies affecting the working conditions of the employees. In the case of professional employees the term does not mean educational policies of a school district. “Terms and conditions of employment” is subject to section 179A.07.

Minn. Stat. § 179A.03, subd. 19 (2004). Section 179A.07, in turn, provides that

[a] public employer is not required to meet and negotiate on matters of inherent managerial policy. Matters of inherent managerial policy include, but are not limited to, such areas of discretion or policy as the functions and programs of the employer, its overall budget, utilization of technology, the organizational structure, selection of personnel, and direction and the number of personnel.

Minn. Stat. § 179A.07, subd. 1 (2004). Therefore, the CBA does not require arbitration of “matters of inherent managerial policy.”

The Minnesota Supreme Court has noted that “[t]he decision to transfer a number of teachers is a managerial decision.” Minneapolis Fed’n of Teachers, Local 59 v. Special Sch. Dist. No. 1, 258 N.W.2d 802, 806 (Minn. 1977). But individual transfers may be subject to arbitration “[t]o insure that individual teacher transfers conform to the negotiated contract” when the criteria by which teachers may be identified for transfer are included in the collective-bargaining agreement. Id.

Here, article V, section 5 of the CBA provides that “[t]he superintendent will consider seniority, major and minor fields of study, and other pertinent criteria when assigning teachers.” It does not describe how these criteria are to be weighed. The rest of article V, section 5 describes the procedure by which a transfer will be made, and Education Minnesota does not assert that the district failed to follow that procedure.

There is no express agreement in the CBA to arbitrate the superintendent’s decision to transfer a teacher to another position. Because the CBA fails to articulate how to weigh the criteria to be considered in transferring a teacher and because such transfers are generally within the inherent managerial authority of the superintendent, we conclude that it is not reasonably debatable that the CBA expresses an intent to arbitrate the substance of a transfer decision. Further, Education Minnesota has not asserted that the superintendent misinterpreted or misapplied any “terms and conditions of employment” regarding the CBA’s transfer provision. Nothing in the CBA shows that the parties intended to make a transfer of this kind arbitrable.

Next, Education Minnesota argues that (1) the CBA’s arbitration agreement covers teacher discipline; (2) because the district and Education Minnesota dispute whether Ferrari’s reassignment was disciplinary, the matter is reasonably debatable; and (3) therefore, the district court erred as a matter of law by denying the motion to compel arbitration.

Education Minnesota asserts that the district court erroneously decided on the merits that Ferrari’s reassignment was not disciplinary. A district court is “not allowed to make factual findings when a motion to compel arbitration is brought before it.” Local No. 1119, 463 N.W.2d at 296. Judicial proceedings to stay or compel arbitration are limited to deciding the existence and scope of the arbitration agreement. Id. The district court is “barred from examining into the merits of . . . [any] defense.” Id. (quotation omitted). But the district court concluded that Education Minnesota’s claims were not grounds for a grievance.

From an examination of the CBA’s language, the language of Education Minnesota’s written grievance, and the undisputed facts, we agree that Education Minnesota’s complaint fails to state an arbitrable grievance regarding the application of the district’s disciplinary procedures to Ferrari. The application of disciplinary policies affects the working conditions of teachers, and is, therefore, a term or condition of employment. See Local 59, 258 N.W.2d at 805 (noting that employee suspensions are not matters of inherent managerial policy and affect the working conditions of employees). Here, the CBA provides that “[n]o teacher shall be disciplined except for just cause. The parties agree that the principles of progressive discipline and basic due process will be followed including, but not limited to, verbal warning, written warning, suspension and discharge.” Art. V, sec. 9.

Conflicting contentions regarding the scope of the arbitration agreement may demonstrate that it is reasonably debatable that the parties intended to submit a dispute to arbitration. Local No. 1119, 463 N.W.2d at 296. But Education Minnesota’s analysis, which concludes that this dispute is arbitrable because the parties disagree about whether Ferrari’s reassignment was disciplinary, would lead to the illogical result that every disagreement could be made arbitrable by merely asserting the existence of the disagreement.

Education Minnesota does not show how the CBA’s discipline clause has been misinterpreted or misapplied to Ferrari. As a threshold matter, Education Minnesota does not dispute that Ferrari’s 2002-03 assignment was a non-classroom tutorial position at the elementary school and that the transfer complained of was her 2003-04 assignment to a non-classroom tutorial position at the high school. But Education Minnesota argues that its grievance here rests on the presumption that Ferrari’s reassignment was a “demotion to a non-teaching position” because the state of Minnesota does not require a teaching license for the high-school tutorial position.

The CBA defines “teacher” as “all persons in the appropriate unit employed by the School District in a position for which the person must be licensed by the State of Minnesota.” Art. III, sec. 2. But a school board may require a teaching license from the state for positions for which the state does not require licensure. See In re Petition for Clarification of an Appropriate Unit, 529 N.W.2d 717, 719 (Minn. App. 1995) (noting that under PELRA a person is a teacher if the person holds a position that requires licensure by the board of teaching or the state board of education but that these boards need not be the entities imposing the licensure requirement), review denied (Minn. June 14, 1995). The CBA does not define “teacher” as a person in a position for which the state requires licensure.

Here, the district imposed a licensure requirement for the high-school tutorial position; therefore, the position was a teaching position. Education Minnesota’s assertions that Ferrari’s reassignment was a “demotion to a non-teaching position” and that the reassignment “to this non-teaching position is an act of discipline without just cause” cannot bring her claim within the scope of the arbitration agreement because Ferrari was assigned to a position for which a teaching license was required.

We conclude, therefore, that the district court did not err by denying Education Minnesota’s motion to compel arbitration.

Affirmed.

* Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.