The cba between the City of Beverly, MA and AFSCME Council 93 had a term from 1992-2002. The agreement also contained an evergreen clause that effectively extended all contract provisions until a successor agreement was entered into. In Boston Housing Auth. v. National Conference of of Firemen & Oilers, Local 3, decided in 2010, the Mass. Supreme Judicial Court held that evergreen provisions which extended the cba beyond three years were barred by statute.
In 2003, before a successor agreement had been entered inti, a bargaining unit employee of the City was dismissed. The Union grieved and ultimately arbitrated the dispute. The arbitrator, in an award issued after the Court's decision in Firemen & Oilers, determined that the Court's decision should not be applied retroactively and sustained the grievance. The City sought to set aside the award and the Superior court vacated the decsion, concluding that there was no contract in effect at the time of the dismissal and that the Arbitrator was thus without authority to rule on the dispute.
On the Union's appeal, the Appeals Court reversed and upheld the Arbitrator's decision.
Initially the Court acknowledged that it is "axiomatic" that if there is no contract in effect requiring arbitration at the time a disputed event occurs an arbitrator is without jurisdiction to arbitrate the matter. After discussing whether the Firemen & Oilers decision should be applied to preexisting disputes, the Court found it unnecessary to resolve that issue. It concluded:
In any event, although we tend to agree with the arbitrator that Firemen & Oilers does not apply retroactively, and, therefore, would not invalidate the evergreen clause included in the 1999-2002 CBA, we need not decide the issue. The 2002-2005 CBA, by its plain terms, applied to [Grievant's]'s termination — namely, the CBA was explicitly intended to operate retroactively to July 1, 2002, even though it was executed in June, 2005, and the instant dispute concerning [Grievant's] termination arose during the life of that CBA. The parties' explicit intention to render the CBA retroactive belies the city's argument that it would be unfair or unjust to apply the CBA to [Grievant's] termination. If we were to conclude that the CBA does not have retroactive effect, we would undermine the parties' clearly stated intentions; in accordance with basic rules of contract interpretation, we refuse to do so here.
The decision of the Appeals Court can be found here.