Minnesota Judicial Center (Photo: Kevin Featherly)
Arbitrator found investigation into assistant commissioner’s conduct ‘deeply flawed’
The state may proceed with its appeal of an arbitrator’s decision that reinstated a fired Department of Corrections official, the Court of Appeals ruled in a unanimous special term opinion Tuesday.
The official, Nathan Knutson, was a DOC associate warden of operations at the time of his firing, according to the Court of Appeals ruling. An arbitrator’s report identified him as the assistant commissioner in charge of supervising wardens at all 10 Minnesota prisons. He started working for the department in 1999.
Knutson was terminated after an investigation into alleged misconduct. He appealed the firing to the Bureau of Mediation Services (BMS), which reinstated him with back pay, subject to a 30-day suspension.
Knutson brought his appeal to BMS under Minn. Stat. § 43A.33, subd. 3, which addresses grievances by state employees who, like Knutson, are not covered by collective bargaining agreements.
The BMS is a party to the case although it requested to be removed, which the court denied.
The arbitrator, attorney Richard A. Beens, was chosen from a list provided by the BMS pursuant to the statute. He concluded that the DOC’s termination of Knutson was not supported by just cause.
The DOC responded with a writ of certiorari to the Court of Appeals, under the Minnesota Administrative Procedure Act (MAPA, Minn. Stat. § 14.001, et seq). The statute provides a right to judicial review of an agency final decision.
Knutson argued that Beens’ decision was not a final agency decision, because it was rendered by an independent arbitrator and not a BMS official. He argued that the only proper avenue for review was under the Minnesota Uniform Arbitration Act (UAA, Minn. Stat. § § 572B.01, et seq.)
The Court of Appeals disagreed.
The court noted that § 43A.33, subd. 3, allows employees who are not covered by collective bargaining agreements to appeal to BMS and to receive a list of potential arbitrators under BMS rules.
The court determined that the statute “unambiguously contemplates” that a decision of an arbitrator under that section is a decision of BMS, for the purposes of obtaining judicial review under MAPA.
“Construing the statute as a whole, we conclude that Minn. Stat. § 43A.33, subd. 3, unambiguously contemplates that a decision of an arbitrator appointed under that subdivision is a decision of the BMS, for the purposes of obtaining judicial review under section 14.63 of MAPA.”
In reaching that finding, Segal continues:
“[I]t is significant that subdivision 3 of section 43A.33 provides that the right of appeal by an aggrieved employee is ‘to the Bureau of Mediation Services.’ Minn. Stat. § 43A.33, subd. 3(b) [emphasis added by the court]. In addition, the arbitrator is selected from a list provided by the commissioner of the BMS for an arbitration that must be conducted ‘pursuant to the rules of the [BMS].’ Minn. Stat. § 43A.33, subd. 3(d).” [Emphasis added by the court].
The court said the fact that arbitrators are not BMS employees is not dispositive and that there is no caselaw that distinguishes between an arbitrator who is an employee of the agency or an independent agent.
“To conclude otherwise would deprive parties of any opportunity for judicial review of an arbitration decision rendered under the procedures of Minn. Stat. § 43A.33, subd. 3,” said the court, noting that the UAA applies only to arbitrations held pursuant to an agreement to arbitrate, which is not the case here.
Knutson’s attorney, Marshall Tanick, said his client may seek state Supreme Court review. A broader standard of review required under the MAPA may give the state more leeway and could undercut arbitration law in the state, Tanick said.
‘Smacks of confirmation bias’
As the case continues, front and center will be Beens’ 26-page order. It includes 16 findings of fact with subparagraphs, determining that termination was not proportionate in view of Knutson’s length of service, work record and the seriousness of the violations.
Much of the investigation was “deeply flawed,” Beens wrote.
The department actually conducted two investigations. The first concerned phone calls and text messages between Knutson and a female DOC officer. Although the relationship appears not to have developed beyond flirtation, the arbitrator wrote, Knutson deleted the records from his DOC-issued phone when he was ordered to hand it in.
This resulted in demotion, and was followed immediately by a second investigation into separate misconduct allegations involving conflicts of interest and ethical breaches. That led to termination.
The arbitrator found that Knutson did contact other DOC employees after being informed of the second investigation, although he was told not to do so. This was insubordinate, but not worthy of termination given his employment record and other testimony, Beens wrote.
Several other allegations were unsubstantiated, he found.
In applying a “zero tolerance” standard, the investigator disregarded the context of some communications, construing them as unethical requests, the arbitrator determined.
“Construing these exchanges as ‘ethical breaches’ while ignoring the actual testimony of participants smacks of confirmation bias and/or targeting,” Beens continued.