The Pennsylvania Supreme Court has found an arbitration award reinstating an employee dismissed after being found to have engaged in sexual harassment to be contrary to public policy. Phila. Housing Authority v. AFSCME. Grievant was employed as a warehouseman by the Housing Authority. He was accused of harassing a co-worker by inappropriate touching and sexual comments. After the co-worker learned that grievant was going to be assigned to a desk next to her she advised her supervisor of grievant’s conduct and stated she did not want to work so close to him. When grievant learned of the report he and the coworker engaged in a verbal altercation. Grievant’s supervisor took grievant outside to discuss his behavior and told grievant to stop yelling at the coworker and not to touch her. Shortly thereafter, the altercation was reported to the PHA EEO Officer and an investigation was commenced. After the investigation grievant’s employment was terminated for sexual harassment.
The arbitrator determined that grievant’s conduct was “unacceptable”but that he had not engaged in further inappropriate sexual harassment after the “verbal warning” from his supervisor. As a result he concluded that the PHA did not have just cause to terminate his employment and ordered his reinstatement with back pay.
While noting the traditionally narrow review of arbitration awards, the Pennsylvania Supreme Court found this award contrary to the strong public policy against sexual harassment. It concluded:
Although we do not hold that termination was required under the circumstances here, we likewise reject the arbitrator’s and appellant’s counter-assertion that a public employer can be precluded from taking such decisive action against an employee following its investigation. A public employer should be empowered to implement a zero tolerance policy when appalling, assaultive, repeated sexual harassment is at issue. The arbitration award to the contrary in this case affirmatively encourages -- indeed it rewards -- sexual harassment in the public workplace.
To allow an arbitration award which finds that an employee engaged in “extraordinarily perverse” physical sexual harassment of a coworker, yet then simply dismisses the conduct as unworthy of an employer response beyond initial “counseling,”and reinstatement with back pay, would eviscerate the ability of employers to enforce dominant public policy.
In this case, a holding that the arbitrator’s award did not violate a well-defined, explicit, and dominant public policy would construe the public policy exception so narrowly that it would be, as a practical matter, completely negated.
The Court also distinguished cases arising in the private sector, concluding that in the case of public employees it would apply a less restrictive reading of the public policy exception.
Accordingly the Court vacated the arbitrator’s award. A concurring opinion, while finding the award “reflects such an alarming degree of disharmony as to justify the extremely rare recourse of judicial intervention”, would have remanded the case to the arbitrator for reconsideration.