[J-29-2025] IN THE SUPREME COURT OF PENNSYLVANIA WESTERN DISTRICT
TODD, C.J., DONOHUE, DOUGHERTY, WECHT, MUNDY, BROBSON, McCAFFERY, JJ.
PENNY GUSTAFSON, : No. 24 WAP 2024 : Appellee : Appeal from the Order of the : Commonwealth Court entered : February 20, 2024, at No. 1298 CD v. : 2022, reversing and remanding the : Order of Cambria County Court of : Common Pleas entered February AMERICAN FEDERATION OF STATE, : 11, 2022, at No. 2021-3223. COUNTY, AND MUNICIPAL EMPLOYEES, : COUNCIL 13; AMERICAN FEDERATION : ARGUED: April 10, 2025 OF STATE, COUNTY, AND MUNICIPAL : EMPLOYEES, DISTRICT COUNCIL 83; : AND AMERICAN FEDERATION OF : STATE, COUNTY, AND MUNICIPAL : EMPLOYEES, LOCAL 2047, : : Appellants :
OPINION
JUSTICE MUNDY DECIDED: JANUARY 21, 2026 A public employee sued the union representing her bargaining unit, alleging the
union breached its duty of fair representation by discriminatorily mishandling her
grievance against her public employer. In this appeal by allowance, we are tasked with
discerning whether, under such circumstances, the employee may seek damages from
the union for its breach or whether her remedy is limited to an order compelling the union
to take the grievance to arbitration nunc pro tunc. After careful consideration, we
determine, under the laws of this Commonwealth, that a public employee’s remedy under such circumstances is limited to an order directing arbitration and, therefore, reverse the
order of the Commonwealth Court.
I. Background
Appellee Penny Gustafson (“Gustafson”) is employed by the Pennsylvania
Department of Human Services (“the Commonwealth”) as a Residential Services Aid at
Ebensburg Center, a licensed facility that provides support to people with intellectual
disabilities. As part of her employment, she is a member of a bargaining unit represented
by Appellants American Federation of State, County, and Municipal Employees
(“AFSCME”) Council 13 (“Council 13”), AFSCME District Council 83 (“District Council
83”), and AFSCME Local 2047 (“Local 2047”) (collectively “AFSCME” or “the Unions”).1
Gustafson was previously an AFSCME member but resigned her membership in June
2019. Even though she is no longer a member of AFSCME, AFSCME remains
Gustafson’s exclusive representative for purposes of the Public Employe Relations Act
(“PERA”)2, and Gustafson continues to be subject to the provisions of a collective
bargaining agreement between AFSCME and the Commonwealth, which governs the
terms and conditions of her employment.3
1 As discussed infra, the trial court granted AFSCME’s preliminary objections. Therefore, we must “accept as true all well-pleaded, material, and relevant facts alleged in [Gustafson’s] complaint and every inference that is fairly deducible from those facts.” Raynor v. D’Annunzio, 243 A.3d 41, 52 (Pa. 2020). Accordingly, we deduce the relevant factual background from Gustafson’s complaint. 2 Act of July 23, 1970, P.L. 563, No. 195, 43 P.S. §§ 1101.101, et seq.
3 For the purposes of PERA, Gustafson is a “public employe,” 43 P.S.§ 1101.301(2), and
the AFSCME Appellants are all “employe organizations,” 43 P.S. § 1101.301(3), that act as Gustafson’s exclusive representative, 43 P.S. § 1101.606.
[J-29-2025] - 2 In October 2019, Gustafson was “taken off the floor,”4 purportedly for an
investigation. No investigation, however, was conducted and Gustafson was returned to
her normal duties. During her three weeks “off the floor,” Gustafson lost the opportunity
to work overtime hours and overtime equalization due to her inability to accept such
opportunities.5
On or about October 30, 2019, Gustafson requested AFSCME file a grievance
related to her time “off the floor” and the lack of investigation, which Local 2047 shop
steward Doug Myers (“Myers”) filed on her behalf. After the grievance was filed,
Gustafson inquired with Myers on its status at least once a month, but he failed to provide
her any information other than to state the grievance process was delayed due to the
coronavirus pandemic and would take a while to resolve.
Then, in June 2020, Gustafson called District Council 83 to inquire on the status
of her grievance. Within five days of this phone call, Myers provided Gustafson with a
grievance resolution letter, dated March 3, 2020, which set forth, in relevant part, the
following: “[The] Department offers the following in final resolution of the above case:
Grievant was equalized.” Complaint, 9/22/2021, Exhibit A; R.R. at 19a. The time period
for Gustafson to appeal the grievance resolution letter or otherwise challenge the
resolution of her grievance had passed by the time the letter was provided to her by
Myers. Gustafson was displeased with the resolution of her grievance because, in her
opinion, the resolution did not restore or repay her lost overtime hours or properly
calculate her equalization.
4 At Ebensburg Center, when employees are “taken off the floor” due to an investigation,
they are still considered to be working but do not have any interactions with residents. 5 When employees at Ebensburg Center are “taken off the floor” they are not eligible to
work overtime hours. Overtime priority is determined by an “equalization” process whereby employees who more frequently accept overtime opportunities gain priority for future overtime opportunities.
[J-29-2025] - 3 In light of these events, Gustafson contacted District Council 83 director Dominic
Sgro (“Sgro”) to discuss the handling of her grievance on or about July 7, 2020. During
this conversation, Sgro called Gustafson a “free rider” when he became aware she was
not a member of AFSCME. He then stated that he would look into her case and get back
to her. Complaint at ¶ 51; R.R. at 12a. After not hearing from Sgro for several months,
Gustafson called him on or about October 15, 2020, at which time Sgro told Gustafson
she was “sponging” off the union, that he “knows what happened,” and that Gustafson
received “minimal” or “limited” representation because she is a “freeloader.” Id. at ¶ 53,
R.R. at 12a.
Based on the way it handled her grievance, Gustafson believed AFSCME
“discriminated against, punished, or otherwise retaliated against [her] because of her
decision to be or status as a nonmember of AFSCME.” Id. at ¶ 58; R.R. at 13a.
Accordingly, on September 22, 2021, Gustafson filed a complaint against AFSCME,
raising a single cause of action for breach of the duty of fair representation. Gustafson
did not raise any claims against the Commonwealth, her employer. In her prayer for relief,
Gustafson requested, inter alia, compensatory and punitive damages, reasonable
attorneys’ fees, and requested a trial by jury. Importantly, Gustafson did not request an
order directing AFSCME to bring her grievance to arbitration nunc pro tunc.
In response, AFSCME filed preliminary objections averring, inter alia: (1) demurrer,
raising insufficient specificity and legal insufficiency to the claim for damages on duty of
fair representation claim; (2) demurrer, raising legal insufficiency to the claim for punitive
damages as improper in a duty of fair representation case; and (3) demurrer, raising legal
insufficiency to the claim for attorneys’ fees and costs as improper in a duty of fair
representation case. The trial court granted AFSCME’s aforementioned objections,
[J-29-2025] - 4 dismissed their remaining preliminary objections as moot, and dismissed Gustafson’s
complaint with prejudice.
Gustafson appealed, challenging the trial court’s grant of AFSCME’s preliminary
objection related to her claim for damages on her duty of fair representation claim and
dismissal of her complaint. Before the Commonwealth Court, Gustafson argued that she
set forth a legally cognizable claim for damages arising out of AFSCME’s breach of its
duty of fair representation and that the entitlement to relief for such a breach is not limited
to a request for nunc pro tunc arbitration.
A unanimous, en banc panel reversed in a published opinion. Gustafson v. Am.
Fed’n of State, Cty., and Mun. Emp., Council 13, 310 A.3d 1267 (Pa. Cmwlth. 2024). The
Commonwealth Court began by setting forth the relevant law regarding breach of duty of
fair representation claims in this Commonwealth. According to the panel, this Court first
recognized a cause of action for breach of duty of fair representation in Falsetti v. Local
Union No. 2026, United Mine Workers of America, 161 A.2d 882 (Pa. 1960), where we
stated “[i]f the [u]nion, in processing an employee’s grievance, does not act in good faith,
in a reasonable manner[,] and without fraud, it becomes liable in damages for breach of
duty.” Gustafson, 310 A.3d at 1270 (quoting Falsetti, 161 A.2d at 896). As for the remedy
for such a breach, the lower court quoted the Supreme Court of the United States’ opinion
in Vaca v. Sipes, 386 U.S. 171 (1967), where the High Court concluded that “an order
compelling arbitration should be viewed as one of the available remedies when a breach
of the union’s duty is proved. But we see no reason inflexibly to require arbitration in all
cases.” Gustafson, 310 A.3d at 1271 (quoting Vaca, 386 U.S. at 196) (emphasis provided
by Commonwealth Court removed).
The en banc panel proceeded to discuss this Court’s application of the breach of
duty of fair representation in the PERA context. In doing so, the court first quoted our
[J-29-2025] - 5 opinion in Ziccardi v. Department of General Services, 456 A.2d 979 (Pa. 1982), where
we held that a “union’s refusal to submit a grievance to arbitration does not fall under any
of the categories of unfair labor practice enumerated in … PERA” and that “[u]nder
Falsetti, a member of a bargaining unit has a right to sue his union for failure to proceed
to arbitration when the complaint alleges bad faith.” Gustafson, 310 A.3d at 1271 (quoting
Ziccardi, 456 A.2d at 980-81) (emphasis provided by Commonwealth Court removed).
The appellate court then block quoted our opinion in Martino v. Transport Workers’ Union
of Philadelphia, Local 234, 480 A.2d 242 (Pa. 1984), emphasizing in that case, this Court
observed that the complainant “s[ought] to order arbitration,” and that “in cases governed
by state labor law[,] [the court’s] power is limited to that remedy[,]” and that an order to
arbitrate “the underlying grievance nunc pro tunc provides the employee with a complete
and adequate legal remedy.” Gustafson, 310 A.3d at 1272 (quoting Martino, 480 A.2d at
251). The en banc panel further highlighted that in Martino, we discussed the Vaca
Court’s refusal to mandate arbitration in breach of fair representation cases, noting that
an employee may be seeking damages against the union that “an arbitrator may have no
power under the bargaining agreement to award” and that, while issues eligible for
arbitration may be resolved through litigation of the breach of fair duty claim “[i]t does not
follow … that the court should proceed to decide the merits.” Id. at 1273 (quoting Martino,
480 A.2d at 252).
Applying the above legal principles to the facts as pled in Gustafson’s complaint,
the Commonwealth Court rejected AFSCME’s argument that Martino demanded
affirmance of the trial court’s dismissal. According to the court, unlike the claimant in
Martino, Gustafson did not seek an order directing AFSCME to take her grievance to
arbitration nunc pro tunc, nor did she ask the court to decide the merits of her underlying
grievance. Id. Additionally, the court determined Gustafson was not alleging wrongdoing
[J-29-2025] - 6 on the part of the Commonwealth, her employer, but, rather, her claim rested solely on
AFSCME’s alleged failure “to fairly represent her during a workplace investigation and
subsequent grievance proceeding.” Id. As such, the court determined Gustafson’s claim
was not an unfair labor practices claim under PERA and thus, it was not free and clear
from doubt whether she could proceed on a claim for damages against AFSCME.
Accordingly, the appellate court reversed the trial court’s order and remanded the matter
for further proceedings.
II. Issues and Standard of Review
We granted AFSCME’s petition for allowance of appeal to address the following
issues:
(1) Whether the Commonwealth Court’s decision below is contrary to this Court’s ruling in Martino v. Transport Workers’ Union, 480 A.2d 242 (Pa. 1984)?
(2) Whether in a duty of fair representation claim, Section 1101.903 of PERA requires arbitration when plaintiff-employee received relief through the grievance process and the action for damages against the union requires the trial court to evaluate what the employee is entitled to under the collective bargaining agreement?
(3) Whether, in a duty of fair representation claim, a public sector employer is an indispensable party when the employee’s requested remedy requires the trial court to evaluate what the employee is entitled to under the collective bargaining agreement? Gustafson v. Am. Fed’n of State, Cty., and Mun. Emp., Council 13, 323 A.3d 1267, 1267-
68 (Pa. 2024) (per curiam order).
As this case comes before us on appeal from the trial court’s grant of AFSCME’s
preliminary objections in the nature of a demurrer, our standard of review
is de novo, and our scope of review is plenary. See Ladd v. Real Estate Commission, 230 A.3d 1096, 1103 (Pa. 2020), citing Mazur v. Trinity Area Sch. Dist., 961 A.2d 96, 101 (Pa. 2008). “We recognize a demurrer is a preliminary objection to the legal sufficiency of a pleading and raises questions of law; we must therefore ‘accept as true all well-pleaded,
[J-29-2025] - 7 material, and relevant facts alleged in the complaint and every inference that is fairly deducible from those facts.’ A preliminary objection in the nature of a demurrer ‘should be sustained only in cases that clearly and without a doubt fail to state a claim for which relief may be granted.’” Id. (internal citations omitted), quoting Yocum v. Commonwealth, Pennsylvania. Gaming Control Bd., 161 A.3d 228, 234 (Pa. 2017). Raynor v. D’Annunzio, 243 A.3d 41, 52 (Pa. 2020).
III. Arguments of the Parties
In AFSCME’s view, the Commonwealth Court’s decision contravenes both PERA
and our prior decisions addressing duty of fair representation claims in the public employee
context, namely Martino. The Unions observe that, pursuant to Section 903 of PERA,
“[a]rbitration of disputes or grievances arising out of the interpretation of the provisions of
a collective bargaining agreement is mandatory.” AFSCME’s Brief at 15 (quoting 43 P.S.
§ 1101.903). AFSCME asserts Gustafson’s duty of fair representation claim arises out of
the interpretation of the collective bargaining agreement between AFSCME and the
Commonwealth, thus limiting her remedy to requiring AFSCME to arbitrate her grievance
nunc pro tunc rather than monetary damages. In support of its position that Section 903
controls, AFSCME asserts that its duty of fair representation to Gustafson arises out of the
Unions’ status as exclusive representative of the employees in the bargaining unit, which
it argues exists solely by virtue of Sections 602 and 606 of PERA. Id. at 30-31 (citing 43
P.S. §§ 1101.602; 606).
Reinforcing this latter point, Amicus Pennsylvania State Education Association
(“PSEA”) argues Gustafson incorrectly contends her breach of duty of fair representation
claim arises out of the common law. Instead, amicus asserts a duty of fair representation
claim “arises always and only in the context of exclusive representation authority that is
provided by statute.” PSEA Amicus Brief at 3 (citing Vaca, 386 U.S. at 177; Case v.
[J-29-2025] - 8 Hazelton Area Educ. Support Personnel Ass’n, 928 A.2d 1154 (Pa. Cmwlth. 2007); Felice
v. Sever, 985 F.2d 1221, 1227-28 (3d Cir. 1993)).6
Additionally, AFSCME contends Gustafson’s claim is based on her assertion that
she was entitled to a more advantageous resolution of her grievance under the collective
bargaining agreement. Resolution of that claim, and the determination of whether
AFSCME’s actions actually caused Gustafson any harm, necessarily requires resolution
of a dispute arising under the collective bargaining agreement. As such, AFSCME asserts
PERA bars Gustafson’s claim for damages and limits the remedy for her duty of fair
representation claim to an order directing the Unions to arbitrate her grievance nunc pro
tunc. Additionally, AFSCME emphasizes that since Gustafson’s claim is based on her
assertion that the Union mishandled her grievance and she was entitled to a more
advantageous outcome under the collective bargaining agreement, her claim is based on
the Commonwealth’s violation of the collective bargaining agreement, requiring it be
arbitrated pursuant to Section 903. AFSCME’s Reply Brief at 21.
A proper reading of our decision in Martino, AFSCME insists, supports its position.
AFSCME asserts Martino rejected the remedial scheme that developed in the private
sector under the federal Labor Management Relations Act (“LMRA”), 29 U.S.C. §§ 141, et
seq., and instead held that in a public employee’s duty of fair representation claim “the
employee’s relief under PERA is limited to an order from the chancellor compelling
arbitration of the underlying grievance.” AFSCME’s Brief at 16 (quoting Martino, 480 A.2d
6 In addition to PSEA, the United Steel, Paper and Forestry, Rubber, Manufacturing,
Energy, Allied Industrial and Service Workers International Union, AFL-CIO, CLC, the American Federation of Teachers, the Service Employees International Union, and the United Food and Commercial Workers International Union, the Pennsylvania State Corrections Officers Association, Pennsylvania State Lodge, Fraternal Order of Police, International Association of Fire Fighters, Local Union Nos. 22, 319 and 627, Lackawanna and Lehigh County Deputy Sheriffs Associations, Fraternal Order of Transit Police and Temple University Police Association, and the Association of Pennsylvania State College and University Faculty filed amici briefs in support of AFSCME.
[J-29-2025] - 9 at 245). According to AFSCME, if the arbitrator finds a violation of the collective bargaining
agreement during the subsequent arbitration, Martino directs that the arbitrator shall
apportion any damages remedy between the union and the employer. In this vein,
AFSCME criticizes the Commonwealth Court’s reliance on Vaca for the proposition that
an employee’s remedy in a duty of fair representation claim is not limited to arbitration of
the underlying grievance. Per AFSCME, Martino explicitly rejected Vaca’s reasoning for
duty of fair representation claims arising under PERA. Id. at 23 (citing Martino, 480 A.2d
at 248). In fact, AFSCME contends Martino unequivocally “held that an order compelling
arbitration of the grievance nunc pro tunc awarded to a successful duty of fair
representation plaintiff ‘provides the employee with a complete and adequate legal
remedy.’” Id. at 24 (quoting Martino, 480 A.2d at 248 n.10). AFSCME insists that this
remedial framework for a proven breach of the duty of fair representation is designed to
provide the bargaining unit employee “precisely the treatment all the employees in the
[bargaining] unit are entitled to under the collective bargaining agreement.” AFSCME’s
Reply Brief at 7 (quoting Martino, 480 A. 2d at 252).7
In light of its position that the sole remedy for a public employee’s duty of fair
representation claim under PERA is arbitration, AFSCME contends that the public
employer is an indispensable party in any such action. AFSCME contends “a party is
indispensable when he has such an interest that a final decree cannot be made without
affecting it, or leaving the controversy in such a condition that the final determination may
be wholly inconsistent with equity and good conscience.” Id. at 41 (quoting Van Buskirk
7 According to AFSCME, the only exception to this rule is when the employee alleges,
and ultimately proves, that “the employer actively participated with the union in its bad faith deprivation of the employee’s right to protection under the collective bargaining agreement[.]” AFSCME’s Brief at 16 (quoting Martino, 480 A.2d at 251 n.16). Under those circumstances, AFSCME asserts “the court may determine that a damages remedy is appropriate and ‘can direct different appropriate apportionment to the backpay liability.’” Id. (quoting Martino, 480 A.2d at 251 n.16).
[J-29-2025] - 10 v. Van Buskirk, 590 A.2d 4, 7 (Pa. 1991). AFSCME further highlights that in Martino, this
Court explained that “in a duty of fair representation case where the remedy is an order
compelling arbitration, ‘the employer approaches the status of an indispensable party to
the litigation in the sense that the dispute cannot be finally resolved with equity and good
conscience without his participation.’” Id. at 42 (quoting Martino, 480 A.2d at 245). In
AFSCME’s view, that the employer is an indispensable party is an unavoidable conclusion
since an order compelling arbitration of the underlying grievance would be utterly
meaningless if it was directed solely to the union. Only if the employer is a party to the
duty of fair representation case can the court order it to participate in arbitration and only
if it participates in arbitration can the arbitrator direct it to remedy any contractual violation
it is found to have committed. Thus, AFSCME asserts, the public employer’s participation
is necessary to enable the employee to obtain the only relief permitted under PERA and
to resolve the case with equity and good conscience, making it indispensable.
Gustafson retorts that Section 903 does not constrain her remedy to an order
directing AFSCME to proceed to arbitration on her underlying grievance nunc pro tunc
because her duty of fair representation claim arises out of the common law rather than the
collective bargaining agreement. As such, Gustafson argues PERA does not apply. She
contends our appellate courts have confirmed that PERA does not apply to such actions
because they do not constitute an unfair labor practice. Gustafson’s Brief at 25 (citing
Case v. Hazelton Area Educ. Support Pers. Ass’n, 928 A.2d 1154, 1161 (Pa. Cmwlth.
2007)). In Gustafson’s view, PERA applies only when arbitration is at issue and not in a
tort claim for damages for the union’s breach of the duty of fair representation when
reinstatement is not involved. According to Gustafson, this Court recognized the duty of
fair dealing as a common law cause of action for which a union can be held liable for
damages in Falsetti when we held “[if] the [u]nion, in processing an employee’s grievance,
[J-29-2025] - 11 does not act in good faith, in a reasonable manner and without fraud, it becomes liable in
damages for breach of duty.” Id. at 21 (quoting Falsetti¸ 161 A.2d at 895 (emphasis
provided by Gustafson removed)).
While Gustafson argues her duty of fair representation claim arises out of
AFSCME’s discriminatory mishandling of her grievance due to her nonmember status, she
acknowledges that a court may be required to analyze the underlying grievance during the
damages phase of her case. Nevertheless, she asserts that we previously recognized the
merits of an underlying grievance pertain only to damages when we noted that “[w]hether
there was just cause becomes relevant on the issue of damages, only after bad faith has
been shown.” Id. at 29 (quoting Ziccardi, 456 A.2d at 981). Therefore, Gustafson posits
that the necessity to analyze the merits of the underlying grievance does not require the
court to reopen the grievance by sending it back to arbitration nunc pro tunc. Gustafson
analogizes her duty of fair representation claim to a legal malpractice claim where courts
must analyze the merits of the client’s underlying case without reopening the matter.
Gustafson further argues that to hold otherwise would require the court to alter the terms
of the collective bargaining agreement’s arbitration limitations period, for which courts lack
the authority.
Her position, Gustafson asserts, is in line with Martino, which she insists provides
for arbitration when it is the requested remedy and is necessary to make the plaintiff whole
but does not alter the common law paradigm when an employee opts to seek a damages
remedy from the union. In Martino, Gustafson contends, PERA was implicated since the
statute applied to the plaintiff’s suit in equity against his employer for wrongful discharge.
In Gustafson’s view, the remedy of nunc pro tunc arbitration is appropriate when damages
and other court-ordered relief cannot make the employee whole and the only type of
remedy that could make the employee whole is one that, under PERA, can be awarded
[J-29-2025] - 12 only through the arbitration process. She insists that this is not the case here, because
she is not seeking reinstatement or other equitable relief but, rather, is seeking to be made
whole via damages from AFSCME for breach of its duty. In response, AFSCME asserts
the relief sought by an employee is not determinative of the relief to which the employee
is entitled. In its view, a duty of fair representation plaintiff does not get to decide whether
and when arbitration of a dispute is mandatory pursuant to Section 903 merely through
the relief sought. Section 903, AFSCME stresses, makes arbitration mandatory even if
the employee attempts to seek different relief. AFSCME’s Reply Brief at 21.
Finally, as she insists a public employee is not limited to seeking the equitable
relief of nunc pro tunc arbitration for a union’s breach of its duty of fair representation,
Gustafson maintains that a public employer is not necessarily an indispensable party to
such a claim. According to Gustafson, “[i]f the employee is not seeking reinstatement or
arbitration, and is only seeking damages from the union for an alleged breach of its duty
of fair representation, then the employer does not approach the status of an indispensable
party.” Id. at 15-16 (quoting Pa. Soc. Servs. Union v. Lynn, 677 A.2d 371, 374 (Pa.
Cmwlth. 1996)). In her view, if a public employee seeks to be made whole via damages
from the union, the public employer is not required to be joined as a party in order for the
employee to obtain relief. In other words, Gustafson argues a public employer’s
involvement in an employee’s duty of fair representation claim against a union is
dependent on the relief the employee is seeking. If the employee is seeking arbitration or
reinstatement the employer may be an indispensable party, but if, as is the case here, the
employee is merely seeking damages from the union, then the employer is not
indispensable.8
8 Gustafson rejects AFSCME’s contention that a public employee can only seek damages
in a duty of fair representation claim if the employee alleges, and ultimately proves, collusion between the employer and the union. In her view, allegations of collusion (continued…)
[J-29-2025] - 13 IV. Discussion
The Supreme Court of the United States first recognized individual employees’
right to equitable relief against their union for breaches of the duty of fair representation in
Steele v. Louisville & Nashville R.R. Co., 323 U.S. 192 (1944). Martino 480 A.2d at 246
n.9. Then, in Falsetti, this Court held that “[i]f the [u]nion, in processing an employee’s
grievance, does not act in good faith, in a reasonable manner and without fraud, it
becomes liable in damages for breach of duty.” 161 A.2d at 895 (footnote omitted).
Subsequent to Falsetti, the Supreme Court in Vaca observed that “it is now well
established that, as the exclusive bargaining representative of the employees in
[employee’s] bargaining unit, the [u]nion had a statutory duty fairly to represent all of those
employees, both in its collective bargaining with [the employer] … and in its enforcement
of the resulting collective bargaining agreement.” 386 U.S. at 77 (citing, inter alia, Ford
Motor Co. v. Huffman, 345 U.S. 330 (1953); Humphrey v. Moore, 375 U.S. 335 (1964)).
We further explained that a union owes this duty of fair representation to all members of
the bargaining unit it is certified to serve, union members and non-members alike. See
Falsetti. at 895 n.21 (a union breaches its duty if it “refuse[s] to press a justifiable grievance
either because of laziness, prejudice or unwillingness to spend money on behalf of
employees who [are] not members of the union.” (internal quotations and citation
omitted; emphasis added)).
Also, in Falsetti, we noted that “[a] union’s duty of fair representation is founded
upon the … relationship between the union and its members, as well as the duty imposed
upon the union by state and federal labor statutes.” 161 A.2d at 895 n.21. According to
Vaca, a union’s “statutory authority to represent all members of a designated unit includes
between the union and the employer are necessary only if the employee is seeking damages from the employer. Gustafson’s Brief at 42 (citing Speer v. Philadelphia Housing Authority, 533 A.2d 504, 506 (Pa. Cmwlth. 1987)).
[J-29-2025] - 14 a statutory obligation to serve the interest of all members without hostility or discrimination
towards any, to exercise its discretion with complete good faith and honesty, and to avoid
arbitrary conduct.” Vaca, 386 U.S at 177. Further, when an employee alleges a union
breached its duty of fair representation by failing to arbitrate the employee’s grievance “the
employee’s action is based on the employer’s alleged breach of [the collective bargaining
agreement] plus the union’s alleged wrongful failure to afford him his contractual remedy
of arbitration.” Vaca, 386 U.S at 196. As to an employee’s remedy for a union’s breach
of its duty of fair representation, the Vaca Court stated “an order compelling arbitration
should be viewed as one of the available remedies when a breach of the union’s duty is
proved. But we see no reason inflexibly to require arbitration in all cases.” Id.; see also
Falsetti, 161 A.2d at 895 (“[i]f the [u]nion, in processing an employee’s grievance, does
not act in good faith, in a reasonable manner and without fraud, it becomes liable in
damages for breach of duty.” (emphasis added) (footnote omitted).
The aforementioned cases, in addition to other federal matters which discussed a
union’s duty of fair representation and an employee’s corresponding remedy for said
breach, arose under federal labor law, specifically the LMRA. See Martino, 480 A.2d at
245-46. Public employees in the Commonwealth, however, are not governed by the
LMRA. See 29 U.S.C. §§ 142(3); 152(2), (3). Rather, PERA is the pertinent statute. See
43 P.S. §§ 1101.301(1), (2). As such, cases discussing a union’s duty of fair
representation and an employee’s right to sue for breach of that duty under federal labor
law “are instructive, [but] they are not authoritative” in Pennsylvania cases involving public
employees, unions representing those public employees, and public employers, which are
not controlled by federal labor law. Id. at 249.
That said, in Ziccardi, we held that a public employee union’s refusal to submit a
grievance to arbitration was not an unfair labor practice under PERA and applied Falsetti’s
[J-29-2025] - 15 holding that “a member of a bargaining unit has a right to sue his union for failure to
proceed to arbitration when the complaint alleges bad faith” in the PERA context. Ziccardi,
456 A.2d at 330.9 Similar to their federally regulated counterparts, public sector unions’
duty of fair representation is derived from their statutory authority as the exclusive
representative of all members of the bargaining unit the unions have been selected to
represent. See 43 P.S. §§ 1101.602; 606. Therefore, even though PERA does not
specifically mention a claim for breach of the duty of fair representation, such a claim
certainly arises out of PERA in the public employee context. Contrary to the assertions
made in the dissent, we are not suggesting that a public employee union’s duty of fair
representation arises out of the collective bargaining agreement. See Dissenting Op. at
10. The duty itself “is founded upon the … relationship between the union and its
members, as well as the duty imposed upon the union by” PERA. Falsetti, 161 A.2d at
895 n.21. It is the breach of that duty, as the High Court explained in Vaca, that arises,
at least partially, out of the collective bargaining agreement when the breach is based on
the union’s failure to arbitrate the employee’s grievance. See Vaca, 386 U.S. at 196.
Additionally, unions representing public employees’ duty of fair representation extends
9 In Ziccardi, this Court appears to have misstated the relevant facts underlying Falsetti,
noting in that case, we “held that a public employee’s remedy for his bargaining agent’s refusal to submit a grievance to arbitration is an action against the union for damages for breach of its duty of fair representation.” 456 A.2d at 329-30. Falsetti, however, did not involve a public employee but instead involved a former coal company employee who sued his former union, Local No. 2026, United Mine Workers of America, and his former private employer, Pittsburgh Consolidated Coal Company. Our determination of whether PERA limits public employees’ relief for their unions’ breach of the duty of fair representation, therefore, does not impact the continued applicability of Falsetti’s holding in the private sector context. While Falsetti did not involve a public employee or employer, we did apply the duty of fair representation in such a context in Ziccardi and courts of this Commonwealth have subsequently continuously applied this same duty to unions representing public-sector employees. Here, neither of the parties argue that public sector unions do not have such a duty.
[J-29-2025] - 16 equally to union and non-union members alike. Pa. Labor Rels. Bd. v. Eastern Lancaster
Cnty. Educ. Ass’n, 427 A.2d 305, 307 (Pa. Cmwlth. 1981).
While we have adopted the federally recognized duty of fair representation and
corresponding cause of action for the breach of such duty in the public employee context
in Pennsylvania, we have departed from the federal approach to an employee’s remedy
for a union’s breach of its duty. As discussed above, the Supreme Court in Vaca stated
that “an order compelling arbitration should be viewed as one of the available remedies
when a breach of the union’s duty is proved. But we see no reason inflexibly to require
arbitration in all cases.” 386 U.S at 196. In explaining its reasoning, the High Court
continued:
[i]n some cases, for example, at least part of the employee’s damages may be attributable to the union’s breach of duty, and an arbitrator may have no power under the bargaining agreement to award such damages against the union. In other cases, the arbitrable issues may be substantially resolved in the course of trying the fair representation controversy. In such situations, the court should be free to decide the contractual claim and to award the employee appropriate damages or equitable relief. Id. Notably, this Court did not find this reasoning persuasive and explicitly rejected it in
Martino because it “would entrust resolution of the merits of the underlying grievance to
the court rather than the arbitrator[.]” 480 A.2d at 248. The reason for our rejection of the
analysis articulated in Vaca was based primarily on the disparate ways in which the LMRA
and PERA approach arbitration of labor disputes. Under the LMRA, arbitration of labor
disputes is permitted, and federal case law encourages it. Id. at 248 n.10. PERA, on the
other hand, does not just encourage arbitration of labor disputes but affirmatively
mandates it pursuant to Section 903. 43. P.S. §1101.903 (“Arbitration of disputes or
grievances arising out of the interpretation of the provisions of a collective bargaining
agreement is mandatory.”).
[J-29-2025] - 17 Along these same lines, we have previously recognized the distinction between
the statutes’ different approaches, explaining PERA’s arbitration policy “is even stronger
than that embodied in federal labor policy. Federal policy merely favors the submission of
disputes to arbitration, while the PERA requires it.” Bd. of Educ. v. Phila. Fed. Of Teachers,
346 A.2d 35, 39 (Pa. 1975) (internal citations omitted). With this distinction and PERA’s
arbitration mandate in mind, we concluded in Martino that if a public employee proves the
union breached its duty of fair representation, the court of common pleas, sitting in equity,
“may, under proper circumstances, order the union and employer to arbitrate the aggrieved
employee’s grievance” nunc pro tunc and that such an outcome “provides the employee
with a complete and adequate remedy.” 480 A.2d at 251. We further concluded that in
cases governed by PERA, nunc pro tunc arbitration is the only available remedy for the
court of common pleas in cases where a union breaches its duty of fair representation. Id.
at 252. In rejecting our interpretation of Martino and adopting Vaca’s position that “[t]he
appropriate remedy for a breach of a union’s duty of fair representation must vary with the
circumstances of the particular breach[,]” Dissenting Op. at 21 (quoting Vaca, 386 U.S. at
195), the dissent fails to address the significant difference in the approaches to arbitration
taken by PERA and its federal counterparts and Martino’s express rejection of the
reasoning in Vaca.
Turning to the matter at issue, we find that there are significant differences
between Martino and the present case. Importantly, unlike the employee in Martino,
Gustafson filed her present complaint solely against AFSCME and not the Commonwealth,
her employer. Additionally, Gustafson does not seek equitable relief of reinstatement or
arbitration of her underlying grievance, but, rather, seeks to be made whole exclusively
through money damages from AFSCME. That said, these differences do not alter the
[J-29-2025] - 18 application of our reasoning in Martino.10 Under the plain language of PERA, whether
arbitration is mandatory is not based on the party the employee files suit against or the
relief the employee seeks. Specifically, per Section 903, “[a]rbitration of disputes or
grievances arising out of the interpretation of the provisions of a collective bargaining
agreement is mandatory.” 43 P.S. § 1101.903. Thus, the requirement of arbitration is
based on whether the dispute arises out of the interpretation of the collective bargaining
agreement between the union and the employer and not, as Gustafson and the dissent
contend, on the remedy sought by the employee.
A thorough review of Gustafson’s complaint evinces that her dispute with AFSCME
falls within Section 903’s arbitration mandate. Gustafson alleges AFSCME violated its
duty of fair representation “by failing to fairly represent her during the investigation and
processing of her grievance[.]” Complaint at ¶ 54; R.R. at 12a. Specifically, Gustafson
accuses AFSCME of “failing to try to help [her] or otherwise represent her in connection
with the workplace investigation[,]” “failing to adequately pursue or protect her interest in
10 The dissent’s reliance on the fact that the employee in Martino sought nunc pro tunc
arbitration rather than monetary damages from the union is misplaced. Martino’s rejection of Vaca’s more flexible approach did not rely on the remedy sought by the employee. Instead, we focused on the fact that “PERA makes arbitration of all disputes arising under public sector collective bargaining agreements the exclusive remedy for unresolved grievances[.]” Martino, 480 A.2d at 249. Likewise, the dissent’s position that Martino should be limited to the principle “that an employee who sues their union for breaching its duty of fair representation in handling a grievance is limited to the remedy of arbitration nunc pro tunc only when that employee seeks reinstatement for being discharged without just cause under the relevant [collective bargaining agreement] and the union fails to process the related grievance[,]” Dissenting Op. at 13, is not supported by Martino’s holding. Martino held that “[o]nce it has been determined that the union breached its duty of fair representation, the Court of Common Pleas sitting in equity ma[]y order the completion of the arbitration procedure and, in cases governed by state labor law its power is limited to that remedy.” 480 A.2d at 252. (emphasis added). By its own language, Martino applies to all cases governed by state labor law, i.e. PERA, and is clearly not limited in the manner proposed by the dissent.
[J-29-2025] - 19 the processing or resolution of her grievance[,]” “failing to communicate with [her]
regarding the grievance or to consult with or otherwise inform her of its status and on its
resolution[,]” and “preventing [her] from appealing or otherwise challenging the grievance
resolution.” Id. at ¶¶ 64-67; R.R. at 13a-14a. At the heart of Gustafson’s complaint is her
assertion that the grievance resolution agreed to by AFSCME was inadequate and she
was entitled to a more advantageous outcome under the collective bargaining agreement.
See id. at ¶¶ 42-46; R.R. at 11a.
Gustafson acknowledges that the trial court may be required to analyze the merits
of her underlying grievance but insists that analysis would only relate to what damages
she is entitled to from AFSCME. Gustafson’s Brief at 23 (“[A]lthough the merits of the
underlying grievance might have to be examined by the trial court, they would be
considered only through the lens of damages.”); id. at 29 (“[T]he merits of the grievance
may need to be examined, but only to assess the value of the claim.”). The dissent
similarly acknowledges that under its paradigm the trial court “would be required to
examine the underlying grievance in assessing damages if [Gustafson] were to
successfully prove that AFSCME breached its duty in handling her grievance.” Dissenting
Op. at 19-20. The fact that the court would only be required to analyze the merits of the
underlying grievance in determining damages is of no moment. The necessity to analyze
the merits of the underlying grievance at any stage of the proceedings would “entrust
resolution of the merits of the underlying grievance to the court rather than the
arbitrator[.]”11 Martino, 480 A.2d at 248. Assumption of this role by the court is
impermissible pursuant to Section 903’s arbitration mandate. Gustafson’s claim “is based
11 Section 903’s arbitration mandate also makes Gustafson’s and the dissent’s legal malpractice analogy inapt. There is no statutory corollary to Section 903 that mandates that a client’s case precipitating the filing of a malpractice action be arbitrated. The fact that courts may regularly analyze the merits of an underlying case in the legal malpractice arena does not nullify Section 903’s arbitration mandate in the public employee context.
[J-29-2025] - 20 on [the Commonwealth’s] alleged breach of [the collective bargaining agreement] plus
[AFSCME’s] alleged wrongful failure to afford [Gustafson her] contractual remedy of
arbitration.” Vaca, 386 U.S. at 198. See also Waklet-Riker v. Sayre Area Educ. Ass’n,
656 A.2d 138, 140 (Pa. Super. 1995) (Finding the essence of the employee’s claim was
the terms and conditions of the collective bargaining agreement and the failure by the
employer and the union to follow those terms. Thus, the court determined the dispute
arose out of the interpretation of the collective bargaining agreement and PERA controlled
what relief was available). We therefore conclude that when a public employee’s claim
for a union’s breach of its duty of fair representation stems from the union’s alleged
mishandling of a grievance, the claim constitutes a “dispute … arising out of the
interpretation of the provisions of a collective bargaining agreement” and the employee’s
remedy from the court is limited to an order directing the underlying grievance be arbitrated
nunc pro tunc. 43 P.S. § 1101.903.12,13
Finally, in directing our attention to AFSCME’s third issue, we note that it is well-
established that an employee does not have a right to bring an equity action against an
employer for breach of a collective bargaining agreement or for a union’s failure to take a
grievance to arbitration. Ziccardi, 456 A.2d at 981; Martino, 480 A.2d at 243. Instead, as
explained above, the employee’s avenue to relief is to file an equity action against the
12 Our holding does not address scenarios where the union’s purported breach of its duty
of fair representation stems from circumstances other than its alleged mishandling of an employee’s grievance or when the employee alleges conspiracy or collusion between the union and the employer, as those are not the cases currently before us. 13 We are not unsympathetic to the dissent’s concern that our holding could embolden
unions to “engag[e] in discriminatory behavior against employees on the basis of their union membership status, or, indeed, based upon other protected attributes like race, sex, or religion.” Dissenting Op. at 14. That concern, however, does not permit us to ignore the plain language of Section 903’s arbitration mandate. To the extent our General Assembly shares the dissent’s concerns, it is free to amend PERA to remove such claims from arbitration.
[J-29-2025] - 21 union for breach of its duty of fair representation, as Gustafson did here. Falsetti, 161
A.2d at 896; Ziccardi, 456 A.2d at 981; Martino, 480 A.2d at 243-44. In light of this, and
our conclusion that PERA limits a public employee’s relief to an order compelling nunc pro
tunc arbitration of the underlying grievance, we must now determine whether the public
employer is a necessary and indispensable party to the employee’s claim against the
union.
We have previously stated that a party is indispensable “when his or her rights are
so connected with the claims of the litigants that no decree can be made without impairing
those rights.” City of Philadelphia v. Commonwealth, 838 A.2d 566, 581 (Pa. 2003)
(quoting Sprague v. Casey, 550 A.2d 184, 189 (Pa. 1988)). A party is further indispensable
when it “has such an interest that a final decree cannot be made without affecting it, or
leaving the controversy in such a condition that the final determination may be wholly
inconsistent with equity and good conscience.” Van Buskirk v. Van Buskirk, 590 A.2d 4,
7 (Pa. 1991) (quoting Hartley v. Langkamp and Elder, 90 A. 402, 403 (Pa. 1914)).
In Martino, we stated that in cases where a public employee seeks arbitration of
an underlying grievance, “the public employer approaches the status of an indispensable
party to the litigation in the sense that the dispute cannot be finally resolved with equity
and good conscience without his participation.” 480 A.2d at 245. Subsequent to Martino,
our courts have retained public employers as an indispensable party in employees’ breach
of duty of fair representation cases against their unions after dismissing the direct claims
against the employer “so that the remedy of arbitration, if warranted, may be completely
and adequately enforced.” Casner v. Am. Fed’n of State, Cnty., and Mun. Emp., 658 A.2d
865, 867 (Pa. Cmwlth. 1995); see also, e.g., Garzella v. Borough of Dunmore, 62 A.3d
486, 493 (Pa. Cmwlth. 2013), Reisinger v. Commonwealth, Dept. of Corrections, 568 A.2d
1357, 1361 (Pa. Cmwlth. 1990), Krenselak v. Canon-McMillan School Dist., 866 A.2d 346,
[J-29-2025] - 22 348 (Pa. Cmwlth. 1989); but see Lynn, 677 A.2d 371 (finding the public employer was not
an indispensable party in an employee’s breach of duty of fair representation action
against the union where the employee alleged collusion between the union and the
employee, did not seek arbitration or reinstatement, and merely sought money damages
from the union).
In Reisinger, the public employer agreed it could be joined in an employee’s breach
of duty of fair representation claim against the union “solely for the purpose of
implementing an order granting relief by way of compelling arbitration.” 568 A.2d at 1361.
We concur that a public employer’s presence is necessary when an employee’s remedy
is limited to an order compelling arbitration of the underlying grievance nunc pro tunc as
an order directing arbitration solely against a union would be toothless, as a union cannot
arbitrate the grievance against itself. In this regard, the public employer’s participation is
essential in ensuring that the dispute between the employee and the union is resolved with
equity and good conscience. Thus, in such cases, the public employer not only
approaches the position of an indispensable party but becomes an indispensable party.
Moreover, contrary to Gustafson’s insistence, limiting a public employee’s remedy
to nunc pro tunc arbitration does not immunize the union for its breach. While we rejected
Vaca’s remedy analysis for public employee claims for breach of duty of fair representation
under PERA in Martino, supra, we were persuaded by the Supreme Court’s analysis in
Bowen v. U.S. Postal Service, 459 U.S. 212 (1983), that “an employer who wrongfully
discharges an employee protected by a collective bargaining agreement containing an
arbitration clause, is only responsible for backpay that accrues prior to the hypothetical
date upon which an arbitrator would have issued an award had the employee’s union taken
the matter to arbitration.” Martino, 480 A.2d at 248-49. When the union wrongly failed to
proceed to arbitration, according to Martino, Bowen held that the union was responsible
[J-29-2025] - 23 for the backpay owed to the employee subsequent to that hypothetical date. Id. We
concluded that, “[i]n the absence of an apportionment providing meaningful sanctions
against the union, incentive to comply with the grievance procedure would be diminished.”
Id. at 251. Consistent with our reasoning in Martino, and contrary to the dissent’s attempt
to dismiss Martino’s discussion of apportionment as mere dicta, if a court orders an
employee’s underlying grievance to be arbitrated nunc pro tunc due to the union’s breach
of its duty of fair representation, the arbitrator is required to determine the merits of the
employee’s grievance and apportion damages, if any, between the employer and the union
in accordance with their respective responsibility. See Martino, 480 A.2d at 252.
V. Conclusion
Gustafson’s claim against AFSCME for the union’s breach of its duty of fair
representation stems from AFSCME’s alleged mishandling of Gustafson’s grievance
against the Commonwealth. As such, under PERA, her remedy is limited to an order from
the court compelling AFSCME and the Commonwealth to arbitrate her grievance nunc pro
tunc. In order to facilitate this relief, if warranted, the Commonwealth, as Gustafson’s
employer, is an indispensable party to her action. The order of the Commonwealth Court
is thus reversed.
Justices Dougherty, Wecht and McCaffery join the opinion.
Justice McCaffery files a concurring opinion.
Chief Justice Todd files a dissenting opinion in which Justices Donohue and
Brobson join.
[J-29-2025] - 24