essence test in Pennsylvania

2025The Public Policy Exception The above-described essence test is itself a narrow exception to “the vast majority of cases, [in which] the arbitrator’s decision shall be final and binding upon the parties.” State System of Higher Education (Cheyney University) v. State College University Professional Association (PSEA-NEA), 743 A.2d 405, 413 (Pa. 1999).

2025Ass’n (PSEA-NEA), 743 A.2d 405, 413 (Pa. 1999). 9 If the essence test is met, then the award can be vacated only if it satisfies the narrow public policy exception, which means that its enforcement would contravene a well-defined and dominant public policy.

2025See Philadelphia Housing Authority, 52 A.3d at 1117 (“Under [Westmoreland Intermediate Unit #7 v. Westmoreland Intermediate Unit #7 Classroom Assistants Educational Support Personnel Association, PSEA/NEA, 939 A.2d 855, 866 (Pa. 2007)], if the essence test is satisfied, we may consider further whether the award violates a well-defined and dominant public policy.”) (emphasis added).

2024Rather, the crux of the appeal is the public policy exception to the essence test first recognized by our Supreme Court in Westmoreland Intermediate Unit # 7 v. Westmoreland Intermediate Unit # 7 Classroom Assistants Educational Support Personnel Association, PSEA/NEA, 939 A.2d 855 (Pa. 2007) (Westmoreland I) 3 Additionally, in its Cross-Petition, the Association requests that this Court confirm the Arbitration Award and enter judgment ordering PASSHE to abide with same. 4 Act of July 23, 1970, P.L. 563, as amended, 43 P.S. §§ 1101.101-1101.2301. 8 (plurality).

1994In Leechburg Area School District v. Dale, 492 Pa. 515 , 424 A.2d 1309 (1981), our Supreme Court explained that The essence test requires a determination as to whether the terms of the agreement encompass the subject matter of the dispute.

1994In Leechburg Area School District v. Dale, 492 Pa. 515 , 424 A.2d 1309 (1981), our Supreme Court explained that The essence test requires a determination as to whether the terms of the agreement encompass the subject matter of the dispute.

2026Our Supreme Court has explained that “the reviewing court must give deference to the arbitrator’s interpretation of the CBA[,] including for purposes of the first prong of the essence test.” Id. at 1004 .

2025Millcreek, 210 A.3d at 1011 (internal quotations and citations omitted). 9 This Court’s scope of review is a “plenary, non-deferential standard where the resolution of the issues turns on a question of law or application of law to undisputed facts.” City of Philadelphia v. Fraternal Order of Police Lodge No. 5 (Jason Breary), 932 A.2d 274 , 279 n.6 (Pa. Cmwlth. 2007). 9 The essence test is an exceptionally deferential standard, because binding arbitration is a highly favored method of dispute resolution.

2017Pennsylvania Game Comm’n v. State Civil Service Comm’n (Toth), 747 A.2d 887 , 891 n.7 (Pa. 2000) (Toth) (“Thus, we reiterate that the essence test does not permit an appellate court to intrude into the domain of the arbitrator and determine whether an award is manifestly unreasonable.”); Westmoreland, 939 A.2d at 863 . 7 The trial court initially determined that the Arbitrator misapplied Section 1122 of the Public School Code of 1949, Act of March 10, 1949, P.L. 30, as amended, 24 P.S. § 11-1122 (School Code), which provides, in pertinent part: The only valid causes for termination of a contra

2017Pennsylvania Game Comm’n v. State Civil Service Comm’n (Toth), 747 A.2d 887 , 891 n.7 (Pa. 2000) (Toth) (“Thus, we reiterate that the essence test does not permit an appellate court to intrude into the domain of the arbitrator and determine whether an award is manifestly unreasonable.”); Westmoreland, 939 A.2d at 863 . 6 arbitrator.

2007It relies on Greene County v. District 2, United Mine Workers of America, 578 Pa. 347 , 852 A.2d 299 (2004), for the proposition that our Supreme Court carved out an exception to the essence test "in a situation in which the arbitrator’s interpretation of the agreement led to the governmental employer relinquishing essential control over the public enterprise, i.e., those powers essential to its ability to discharge its functions.” Id. at 361 , 852 A.2d at 308 .

2007It relies on Greene County v. District 2, United Mine Workers of America, 578 Pa. 347 , 852 A.2d 299 (2004), for the proposition that our Supreme Court carved out an exception to the essence test "in a situation in which the arbitrator’s interpretation of the agreement led to the governmental employer relinquishing essential control over the public enterprise, i.e., those powers essential to its ability to discharge its functions.” Id. at 361 , 852 A.2d at 308 .

2007State Stores Union, 520 Pa. 266 , 553 A.2d 948, 953-54 (1989) (applying a “manifestly unreasonable” standard); County of Centre v. Musser, 519 Pa. 380 , 548 A.2d 1194 (1988) (applying a reasonableness review standard as part of the essence test); Phila.

2007State Stores Union, 520 Pa. 266 , 553 A.2d 948, 953-54 (1989) (applying a “manifestly unreasonable” standard); County of Centre v. Musser, 519 Pa. 380 , 548 A.2d 1194 (1988) (applying a reasonableness review standard as part of the essence test); Phila.

2025Partners, LP, 873 A.2d 710, 718 (Pa. Super. 2005) (emphasis added).

2021On August 22, 2020, the Fund filed 3 The “gist of the action” doctrine “precludes a party from raising tort claims where the essence of the claim actually lies in a contract that governs the parties’ relationship.” DVREDF I, slip op. at 7-8 (quoting Sullivan v. Chartwell Investment Partners, 873 A.2d 710, 718 (Pa. Super. 2005)). 5 an application for summary relief under Pennsylvania Rule of Appellate Procedure 1532, seeking dismissal of Count II of the PUC’s Complaint on the basis of the statute of limitations.

2025See Philadelphia Housing Authority, 52 A.3d at 1117 (“Under [Westmoreland Intermediate Unit #7 v. Westmoreland Intermediate Unit #7 Classroom Assistants Educational Support Personnel Association, PSEA/NEA, 939 A.2d 855, 866 (Pa. 2007)], if the essence test is satisfied, we may consider further whether the award violates a well-defined and dominant public policy.”) (emphasis added).

2019Hous. , 52 A.3d at 1125 (quoting Westmoreland , 939 A.2d at 868 (Saylor, C.J., concurring)), but it is also an exception to the essence test, which is itself a narrow exception to the doctrine that arbitration awards are final and binding.

2022(Award at 3.) On July 1, 2016, 1 “Under the essence test, the arbitrator’s findings of fact are binding on the courts, and the reviewing court may not undertake any independent factual analysis.” Pennsylvania State System of Higher Education, Lock Haven University v. Association of Pennsylvania State College & University Faculties, 193 A.3d 486, 495 (Pa. Cmwlth. 2018). two months after the CBA was signed, Highmark purchased Blue Cross and became the healthcare insurance provider for the District and Association.

2021Ms. Foster’s new assignment was 1 “Under the essence test, the arbitrator’s findings of fact are binding on the courts, and the reviewing court may not undertake any independent factual analysis.” Pennsylvania State System of Higher Education, Lock Haven University v. Association of Pennsylvania State College & University Faculties, 193 A.3d 486, 495 (Pa. Cmwlth. 2018). 2 closer to her home.

2017We have previously explained the “essence test” used to determine whether an arbitrator’s Award is rationally related to the terms of the CBA, as follows: As stated by the Pennsylvania Supreme Court in Westmoreland Intermediate Unit # 7 v. Westmoreland Intermediate Unit # 7 Classroom Assistants Educational Support Personnel Association, PSEA/NEA, 939 A.2d 855 (Pa. 2007), the essence test was derived from the United States Supreme Court’s decision in United Steelworkers v. Enterprise Wheel & Car Corp., 363 U.S. 593 (1960), wherein, the Court held: An arbitrator is confined to interpretation and

2017We have previously explained the “essence test” used to determine whether an arbitrator’s Award is rationally related to the terms of the CBA, as follows: As stated by the Pennsylvania Supreme Court in Westmoreland Intermediate Unit # 7 v. Westmoreland Intermediate Unit # 7 Classroom Assistants Educational Support Personnel Association, PSEA/NEA, 939 A.2d 855 (Pa. 2007), the essence test was derived from the United States Supreme Court’s decision in United Steelworkers v. Enterprise Wheel & Car Corp., 363 U.S. 593 (1960), wherein, the Court held: An arbitrator is confined to interpretation and

2019Trial Court Order, 1/30/2017, at 2 (applying the Commonwealth Court's three-step analysis for determining whether an arbitration award that satisfies the essence test nonetheless violates public policy, as set forth in City of Bradford v. Teamsters Local Union No. 110 , 25 A.3d 408 , 413 (Pa. Commw. 2011) ).

2019Id. (quoting City of Bradford v. Teamsters Local Union No. 110, 25 A.3d 408, 414 (Pa. Cmwlth. 2011)).

2019Emps., 577 Pa. 257 , 844 A.2d 1217 , 1222 (2004) (emphasizing that the General Assembly expressly provided in section 903 of PERA that the decision of the arbitrator "must be final and binding"); Westmoreland , 939 A.2d at 863 (emphasizing that the essence test requires more deference than would a "manifestly unreasonable" standard of review and remanding for consideration of narrow public policy exception); Phila.

2019Emps., 577 Pa. 257 , 844 A.2d 1217 , 1222 (2004) (emphasizing that the General Assembly expressly provided in section 903 of PERA that the decision of the arbitrator "must be final and binding"); Westmoreland , 939 A.2d at 863 (emphasizing that the essence test requires more deference than would a "manifestly unreasonable" standard of review and remanding for consideration of narrow public policy exception); Phila.

2018In City of Easton v. American Federation of State, County and Municipal Employees, AFL-CIO, Local 447 , 562 Pa. 438 , 756 A.2d 1107 (2000), abrogated by Westmoreland , 939 A.2d 855 , an arbitrator who required reinstatement of an employee determined to have engaged in egregious misconduct that strikes at the very core function of public enterprise, deprived an employer of its ability to perform essential functions, including the ability to discharge, and the arbitrator's award was deemed irrational and, therefore, failed the essence test.

2018In City of Easton v. American Federation of State, County and Municipal Employees, AFL-CIO, Local 447 , 562 Pa. 438 , 756 A.2d 1107 (2000), abrogated by Westmoreland , 939 A.2d 855 , an arbitrator who required reinstatement of an employee determined to have engaged in egregious misconduct that strikes at the very core function of public enterprise, deprived an employer of its ability to perform essential functions, including the ability to discharge, and the arbitrator's award was deemed irrational and, therefore, failed the essence test.

2026Our review of the remedies afforded by an arbitrator also are governed by the essence test. “[A]n arbitrator possesses the authority to fashion remedies necessary to further the intended essence of a [collective bargaining agreement].” Rose Tree Media Secretaries & Educational Support Personnel Association-ESPA, PSEA-NEA v. Rose Tree Medial School District, 136 A.3d 1069, 1080 (Pa. Cmwlth. 2016) (citation omitted).

2021We firmly rejected “the employer’s contention that a court must conduct a de novo review of the arbitrator’s findings in cases subject to the essence test,” and made clear that “an arbitrator’s findings of fact are not reviewable on appeal as long as the arbitrator construed or applied the [parties’ CBA].” Id. (citation omitted).

2019Indeed, this Court will only vacate an arbitrator's award under the essence test "where the award indisputably and genuinely is without foundation in, or fails to logically flow from, the collective bargaining agreement." Slippery Rock University of Pennsylvania, Pennsylvania State System of Higher Education v. Association of Pennsylvania State College & University Faculty , 71 A.3d 353 , 358 (Pa. Cmwlth. 2013).

2018Indeed, this Court will only vacate an arbitrator’s award under the essence test “where the award indisputably and genuinely is without foundation in, or fails to logically flow from, the collective bargaining agreement.” Slippery Rock University of Pennsylvania, Pennsylvania State System of Higher Education v. Association of Pennsylvania State College & University Faculty, 71 A.3d 353, 358 (Pa. Cmwlth. 2013) (quoting State System of Higher Education (Cheney University) v. State College and University Professional Association (PSEA-NEA), 743 A.2d 405, 413 (Pa. 1999)). 5 By single-judge memoran

2023In Westmoreland Intermediate Unit #7 v. Westmoreland Intermediate Unit #7 Classroom Assistants Educational Support Personnel Association, PSEA/NEA, 939 11 A.2d 855 (Pa. 2007), the Pennsylvania Supreme Court explained the history of and defined the essence test as follows: Acknowledging the value of limited judicial review and the potential injurious nature of a broad scope of judicial review which would undermine the arbitration process, shortly after PERA’s enactment, our Court in Community College of Beaver County v. Community College of Beaver County, Society of Faculty (PSEA/NEA), . . . 37

2018Our Supreme Court in Community College of Beaver County, 375 A.2d 1267 , noted that the essence test standard is one characterized by great deference. 8 The Association’s participation and satisfaction is required at all levels of the grievance procedures.

2010Moreover, our Supreme Court has held that the judgment n.o.v./error of law concept set forth in Section 7301(d)(2) is the same as the “essence test.” In Community College of Beaver County, 473 Pa. at 589-90 , 375 A.2d at 1273 , it held that the judgment n.o.v./error of law standard and the essence test are essentially the same, stating that “the ‘n.o.v.’ concept ... is hardly a radical change, nor does it dictate that a much closer or different scrutiny of an arbitration award will be available than under the [essence test].” While that case was decided under the Arbitration Act of 1927, which

2010Moreover, our Supreme Court has held that the judgment n.o.v./error of law concept set forth in Section 7301(d)(2) is the same as the “essence test.” In Community College of Beaver County, 473 Pa. at 589-90 , 375 A.2d at 1273 , it held that the judgment n.o.v./error of law standard and the essence test are essentially the same, stating that “the ‘n.o.v.’ concept ... is hardly a radical change, nor does it dictate that a much closer or different scrutiny of an arbitration award will be available than under the [essence test].” While that case was decided under the Arbitration Act of 1927, which

2019Ass'n, PSEA/NEA , 562 Pa. 238 , 754 A.2d 1255 , 1261 (2000) (observing that application of the essence test limits a reviewing court to merely verifying that the "arbitrator applied the terms of the agreement and discerned the intent of the parties viewed in light of the language, its context and other indicia of the parties' intent"); Office of Attorney General v. Council 13, American Fed'n of State, Cnty.

2019Ass'n, PSEA/NEA , 562 Pa. 238 , 754 A.2d 1255 , 1261 (2000) (observing that application of the essence test limits a reviewing court to merely verifying that the "arbitrator applied the terms of the agreement and discerned the intent of the parties viewed in light of the language, its context and other indicia of the parties' intent"); Office of Attorney General v. Council 13, American Fed'n of State, Cnty.

2021Specifically, the County contends that the Pennsylvania statutory authority relied upon in County of Centre v. Musser, 548 A.2d 1194 (Pa. 1988), provides the explicit, well-defined, and dominant public policy against abuse of prison inmates, which is required to vacate an arbitration award under the public policy exception to the essence test.

2007State Stores Union, 520 Pa. 266 , 553 A.2d 948, 953-54 (1989) (applying a “manifestly unreasonable” standard); County of Centre v. Musser, 519 Pa. 380 , 548 A.2d 1194 (1988) (applying a reasonableness review standard as part of the essence test); Phila.

2014On the issue of punitive damages imposed upon a Commonwealth agency, this Court has explained: Citing federal cases, in City of Philadelphia Office of Housing and Community Development v. American Federation of State, County and Municipal Employees, Local Union No. 1971, 583 Pa. 121 , 876 A.2d 375 [(2005)], our Supreme Court held that under the essence test, an arbitrator could not award punitive damages because government agencies have long been exempt from the imposition of punitive damages.

2008Citing federal cases, in City of Philadelphia Office of Housing and Community Development v. American Federation of State, County and Municipal Employees, Local Union No.1971, 583 Pa. 121 , 876 A.2d 375 , our Supreme Court held that under the essence test, an arbitrator could not award punitive damages because government agencies have long been exempt from the imposition of punitive damages.

2000See, e.g., Pennsylvania Liquor Control Bd., 520 Pa. 266 , 553 A.2d 948 ; Musser, 519 Pa. 380 , 548 A.2d 1194 (1988); Philadelphia Housing Auth. v. Union of Security Officers # 1, 500 Pa. 213 , 455 A.2d 625 (1983). 3 The above cases cited by the City in support of its argument do indeed illustrate the error of the essential holding of the majority of the Commonwealth Court, which was that it lacked the authority to overturn the arbitration award because the Board’s interpretation of the term “willful misconduct” in the disciplinary policy section of Sideletter A to the collective bargaining agr

2000See, e.g., Pennsylvania Liquor Control Bd., 520 Pa. 266 , 553 A.2d 948 ; Musser, 519 Pa. 380 , 548 A.2d 1194 (1988); Philadelphia Housing Auth. v. Union of Security Officers # 1, 500 Pa. 213 , 455 A.2d 625 (1983). 3 The above cases cited by the City in support of its argument do indeed illustrate the error of the essential holding of the majority of the Commonwealth Court, which was that it lacked the authority to overturn the arbitration award because the Board’s interpretation of the term “willful misconduct” in the disciplinary policy section of Sideletter A to the collective bargaining agr

1993FOP Lodge No. 5 (Wilson) , 129 Pa.Commonwealth Ct. at 396, 565 A.2d at 1235 . [10] Also in FOP Lodge No. 5 (Boykins) , where the agreement incorporated only the Home Rule Charter and the regulations of the Civil Service Commission, as it does here, we held that the arbitrator exceeded his authority in ruling on the constitutional issues. [11] The court in FOP Lodge No. 5 (Wilson) stated in dicta that if we were applying the essence test, we would find that the arbitrator's substitution of a lesser penalty was contrary to law based on the substantive civil service law.

1993In applying the essence test, courts must review an arbitrator’s decision to determine whether the award “draws its essence from the collective bargaining agreement.” Fraternal Order of Police Lodge No. 5 (Wilson), 129 Pa.Commonwealth Ct. 392, 396, 565 A.2d 1232, 1234 .

2018The public policy exception to the essence test is a "narrow" one, Westmoreland Intermediate Unit # 7 , 939 A.2d at 865 ; Neshaminy School District v. Neshaminy Federation of Teachers , 171 A.3d 334 , 337-38 (Pa. Cmwlth. 2017) ( en banc ), but is not to be interpreted so narrowly "that it would be, as a practical matter, completely negated." Philadelphia Housing Authority , 52 A.3d at 1125 ; Neshaminy School District , 171 A.3d at 338 .

2018The public policy exception to the essence test is a "narrow" one, Westmoreland Intermediate Unit # 7 , 939 A.2d at 865 ; Neshaminy School District v. Neshaminy Federation of Teachers , 171 A.3d 334 , 337-38 (Pa. Cmwlth. 2017) ( en banc ), but is not to be interpreted so narrowly "that it would be, as a practical matter, completely negated." Philadelphia Housing Authority , 52 A.3d at 1125 ; Neshaminy School District , 171 A.3d at 338 .

2021The County further asserts that Pennsylvania courts have also identified this public policy from Section 5102 of the State Employees’ Retirement Code.11 The County avers that, in Department of Corrections, State Correctional Institution at Forest v. Pennsylvania State Corrections Officers Ass’n, 173 A.3d 854 (Pa. Cmwlth. 2017) (SCI-Forest), this Court held that, by reinstating the grievant to a corrections officer position while placing a restriction on him that is irreconcilable with the statutory definition of correction officer, the arbitrator’s award failed to satisfy the essence test.

2019“The essence test is an exceptionally deferential standard, because binding arbitration is a highly favored method of dispute resolution.” Forest, 173 A.3d at 858 (citing Northumberland Cty.