FRIEDMAN, Judge.
The York County Transportation Authority d/b/a/ Community Transit (YCTA) appeals from an order of the Court of Common Pleas of York County (trial court) denying YCTA’s petition to vacate an Arbitrator’s award which modified the discharge of John P. Smith (Grievant) to a suspension and directed Grievant’s conditional reinstatement.
We affirm.
YCTA, a municipal authority operating fixed route and demand responsive bus service throughout York County, employed Grievant as a fixed route bus driver-. YCTA and Local Union No. 430 of the International Brotherhood of Teamsters (Union), on behalf of various YCTA employees,
were parties to a collective bargaining agreement (CBA), effective January 1, 1996 through December 31, 1998. Articles 11 and 12 of the CBA set forth a grievance and arbitration procedure which, as a final step, allows the Union to submit to arbitration any matter that is not settled in the grievance procedure.
On February 12, 1998, YCTA sent Grievant a letter noting that Grievant’s failure to report for his scheduled shift on that date was a “miss-out,” in violation of section 4.02.05 of YCTA’s “Policies, Procedures, and Discipline Code for Operators and Maintenance Employees” (Shop Rules). The letter further notified Griev-ant that, because this latest incident was his sixth miss-out within one year,
YCTA was terminating him as of February 12, 1998, in accordance with the provisions of the CBA and the Shop Rules.
On February 20, 1998, the Union filed a grievance on Grievant’s behalf. The matter then proceeded through the parties’ grievance procedure, eventually culminating in an arbitration hearing on August 21, 1998, at which the parties each presented evidence in support of their respective positions. In addressing the merits of the grievance,
the Arbitrator properly framed
the issue as follows: did YCTA have just cause to discharge Grievant and, if not, what is the remedy? In considering this issue, the Arbitrator first set forth the relevant CBA and Shop Rule provisions. Specifically, the Arbitrator looked to Article 9 of the CBA, which provides that “ [t]he Employer shall not discharge nor suspend any employee without just cause ....”
(R.R. at 34a.) The Arbitrator also recognized the sections of YCTA’s Shop Rules dealing with employee miss-outs and the progressive disciplinary steps for such infractions of company policy.
These sections state:
4.02.05 Miss-outs
A miss-out occurs anytime an operator fails to report for an assignment at the proper time and place, does not report for work, or calls off sick less than one hour before scheduled to report.
(R.R. at 89a.)
7.05 Other Disciplinary Procedures
Disciplinary steps for missouts or late reporting to work are as follows.
First Offense Warning
Second Offense Caution
Third offense Reprimand
Fourth Offense Subject to Suspension
Fifth Offense Suspension
Sixth Offense Subject to Discharge
(R.R. at 41a.)
In determining whether YCTA had “just cause” to discharge Grievant, the Arbitrator reviewed Grievant’s entire work history but focused on the fourth, fifth and sixth miss-outs charged against Grievant, recorded on November 18,1997, December 19, 1997 and February 12, 1998 respectively.
Although recognizing that Grievant’s work record was replete with absenteeism and miss-outs, the Arbitrator considered the evidence presented at the arbitration hearing and found that “[t]he facts as related by the [Gjrievant show that extenuating circumstances did contribute toward the [Gjrievant’s problem of reporting to work on time or reporting to work at all.” (Arbitrator’s decision at 15, R.R. at 15a.) The Arbitrator stressed that YCTA did not dispute Grievant’s testimony regarding these mitigating circumstances and, further, that medical documentation and disability leave forms showed that Grievant was unable to work for extended periods of time. The Arbitrator'then concluded that, due to these facts and circumstances, “the discipline of discharge was too severe [and Gjrievant should be given the opportunity to show that he can become a contributing and productive employee for [YCTA].” (Arbitrator’s decision at 15-16, R.R. at 15a-16a.) Accordingly, the Arbitrator made the following award:
The grievance is denied in part, in that [YCTA] had just cause to discipline [Gjrievant. It is sustained, in part, in that the discipline of discharge is to be reduced to a disciplinary suspension for the period of time he was off. He is to be reinstated under the terms and conditions set forth in the last paragraph of the Opinion.[
]
(Arbitrator’s decision at 16, R.R. at 16a.) On October 6, 1998, YCTA filed a petition with the trial court seeking to vacate the Arbitrator’s award. The trial court denied YCTA’s petition, concluding that the “Arbitrator based his decisions on the essence of the CBA in determining that just cause did not exist in accordance with [YCTA’s] Shop Rules.” (Trial ct. op. at 12, R.R. at 28a.)
On appeal, YCTA asserts that the trial court erred in affirming the grievance arbitration award (1) because the trial court incorrectly stated that the Arbitrator “found” that 'Grievant’s previous uncontested disciplinary actions lacked merit; (2) because the trial court improperly permitted a collateral attack on prior impositions of discipline; and (3) because the trial court disregarded applicable case law and CBA provisions in ruling that the Arbitrator’s award drew its essence from the
CBA.
Before addressing these issues, however, we must first articulate the proper role of an appellate court when reviewing a labor arbitration award.
Pennsylvania courts have long recognized and endorsed arbitration as the preferred forum for resolving public labor disputes,
see e.g. Leechburg Area School District v. Dale,
492 Pa. 515, 424 A.2d 1309 (1981);
McKeesport Area School District v. McKeesport School Service Personnel Assoc., PSSPA/PSEA,
137 Pa.Cmwlth. 28, 585 A.2d 544 (1990);
Manheim Central Education Association v.
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FRIEDMAN, Judge.
The York County Transportation Authority d/b/a/ Community Transit (YCTA) appeals from an order of the Court of Common Pleas of York County (trial court) denying YCTA’s petition to vacate an Arbitrator’s award which modified the discharge of John P. Smith (Grievant) to a suspension and directed Grievant’s conditional reinstatement.
We affirm.
YCTA, a municipal authority operating fixed route and demand responsive bus service throughout York County, employed Grievant as a fixed route bus driver-. YCTA and Local Union No. 430 of the International Brotherhood of Teamsters (Union), on behalf of various YCTA employees,
were parties to a collective bargaining agreement (CBA), effective January 1, 1996 through December 31, 1998. Articles 11 and 12 of the CBA set forth a grievance and arbitration procedure which, as a final step, allows the Union to submit to arbitration any matter that is not settled in the grievance procedure.
On February 12, 1998, YCTA sent Grievant a letter noting that Grievant’s failure to report for his scheduled shift on that date was a “miss-out,” in violation of section 4.02.05 of YCTA’s “Policies, Procedures, and Discipline Code for Operators and Maintenance Employees” (Shop Rules). The letter further notified Griev-ant that, because this latest incident was his sixth miss-out within one year,
YCTA was terminating him as of February 12, 1998, in accordance with the provisions of the CBA and the Shop Rules.
On February 20, 1998, the Union filed a grievance on Grievant’s behalf. The matter then proceeded through the parties’ grievance procedure, eventually culminating in an arbitration hearing on August 21, 1998, at which the parties each presented evidence in support of their respective positions. In addressing the merits of the grievance,
the Arbitrator properly framed
the issue as follows: did YCTA have just cause to discharge Grievant and, if not, what is the remedy? In considering this issue, the Arbitrator first set forth the relevant CBA and Shop Rule provisions. Specifically, the Arbitrator looked to Article 9 of the CBA, which provides that “ [t]he Employer shall not discharge nor suspend any employee without just cause ....”
(R.R. at 34a.) The Arbitrator also recognized the sections of YCTA’s Shop Rules dealing with employee miss-outs and the progressive disciplinary steps for such infractions of company policy.
These sections state:
4.02.05 Miss-outs
A miss-out occurs anytime an operator fails to report for an assignment at the proper time and place, does not report for work, or calls off sick less than one hour before scheduled to report.
(R.R. at 89a.)
7.05 Other Disciplinary Procedures
Disciplinary steps for missouts or late reporting to work are as follows.
First Offense Warning
Second Offense Caution
Third offense Reprimand
Fourth Offense Subject to Suspension
Fifth Offense Suspension
Sixth Offense Subject to Discharge
(R.R. at 41a.)
In determining whether YCTA had “just cause” to discharge Grievant, the Arbitrator reviewed Grievant’s entire work history but focused on the fourth, fifth and sixth miss-outs charged against Grievant, recorded on November 18,1997, December 19, 1997 and February 12, 1998 respectively.
Although recognizing that Grievant’s work record was replete with absenteeism and miss-outs, the Arbitrator considered the evidence presented at the arbitration hearing and found that “[t]he facts as related by the [Gjrievant show that extenuating circumstances did contribute toward the [Gjrievant’s problem of reporting to work on time or reporting to work at all.” (Arbitrator’s decision at 15, R.R. at 15a.) The Arbitrator stressed that YCTA did not dispute Grievant’s testimony regarding these mitigating circumstances and, further, that medical documentation and disability leave forms showed that Grievant was unable to work for extended periods of time. The Arbitrator'then concluded that, due to these facts and circumstances, “the discipline of discharge was too severe [and Gjrievant should be given the opportunity to show that he can become a contributing and productive employee for [YCTA].” (Arbitrator’s decision at 15-16, R.R. at 15a-16a.) Accordingly, the Arbitrator made the following award:
The grievance is denied in part, in that [YCTA] had just cause to discipline [Gjrievant. It is sustained, in part, in that the discipline of discharge is to be reduced to a disciplinary suspension for the period of time he was off. He is to be reinstated under the terms and conditions set forth in the last paragraph of the Opinion.[
]
(Arbitrator’s decision at 16, R.R. at 16a.) On October 6, 1998, YCTA filed a petition with the trial court seeking to vacate the Arbitrator’s award. The trial court denied YCTA’s petition, concluding that the “Arbitrator based his decisions on the essence of the CBA in determining that just cause did not exist in accordance with [YCTA’s] Shop Rules.” (Trial ct. op. at 12, R.R. at 28a.)
On appeal, YCTA asserts that the trial court erred in affirming the grievance arbitration award (1) because the trial court incorrectly stated that the Arbitrator “found” that 'Grievant’s previous uncontested disciplinary actions lacked merit; (2) because the trial court improperly permitted a collateral attack on prior impositions of discipline; and (3) because the trial court disregarded applicable case law and CBA provisions in ruling that the Arbitrator’s award drew its essence from the
CBA.
Before addressing these issues, however, we must first articulate the proper role of an appellate court when reviewing a labor arbitration award.
Pennsylvania courts have long recognized and endorsed arbitration as the preferred forum for resolving public labor disputes,
see e.g. Leechburg Area School District v. Dale,
492 Pa. 515, 424 A.2d 1309 (1981);
McKeesport Area School District v. McKeesport School Service Personnel Assoc., PSSPA/PSEA,
137 Pa.Cmwlth. 28, 585 A.2d 544 (1990);
Manheim Central Education Association v. Manheim Central School District,
132 Pa.Cmwlth. 94, 572 A.2d 31,
appeal denied,
525 Pa. 661, 582 A.2d 326 (1990);
American Federation of State, County and Municipal Employees, District Council 88, AFL-CIO v. City of Reading,
130 Pa.Cmwlth. 575, 568 A.2d 1352 (1990), and have promoted the use of arbitration by adopting the “essence test,” a highly circumscribed standard of review affording broad deference to arbitrators’ awards. Therefore, a reviewing court may not overturn an arbitrator’s interpretation of the parties’ collective bargaining agreement if that interpretation can, in any rational way, be derived from the agreement, viewed in light of its language, its context, and any other indicia of the parties’ intention.
Community College of Beaver County v. Community College of Beaver County, Society of the Faculty (PSEA/NEA),
473 Pa. 576, 375 A.2d 1267 (1977). However, while final and binding arbitration of grievances is greatly favored, arbitrators’ awards are not inviolate and, on rare occasions, appellate courts are called upon to review an arbitrator’s award.
Very recently, in
State System of Higher Education (Cheyney University) v. State College University Professional
Association (PSE
A/NEA),
743 A.2d 405 (Pa.1999), our supreme court observed an inconsistency in the Pennsylvania courts’ application of the standard of review to be employed in these instances, noting that courts have applied varying degrees of judicial deference to an arbitrator’s award.
The supreme court thus deemed it prudent to restate the analysis to be applied under the essence test. Recognizing the many benefits of arbitration, the court emphasized that the role of a reviewing court should be one of great deference to the arbitrator chosen by the parties so that, in the vast majority of cases, the decision of the arbitrator will be final and binding upon the parties; the exception being where the arbitrator’s award does not draw its essence from the CBA. Then,
essentially reaffirming the original essence test as stated in
Community College of Beaver County,
the court set forth a two-pronged analysis to determine whether this “essence test” was met, stating:
First, the court shall determine if the issue as properly defined is within the terms of the collective bargaining agreement. Second, if the issue is embraced by the agreement, and thus, appropriately before the arbitrator, the arbitrator’s award will be upheld if the arbitrator’s interpretation can rationally be derived from the collective bargaining agreement. That is to say, a court will only vacate an arbitrator’s award where the award indisputably and genuinely is without foundation in, or fails to logically flow from, the collective bargaining agreement.[
]
State System of Higher Education,
743 A.2d at 413.
There is no dispute that the Arbitrator’s award here passes the first prong of the essence test. Because Article 9 of the CBA provides for suspension or discharge of an employee only for just cause, the issue of proper termination lies squarely within the terms of the CBA. Accordingly, in conducting our review, we need only consider whether the Arbitrator’s award can be understood as rationally derived from the CBA.
Initially, YCTA contends that the trial court erred when it determined that the Arbitrator “found” a lack of merit in any of Grievant’s previously uncontested disciplinary actions. In affirming the Arbitrator’s award, the trial court noted that section 7.05 of the Shop Rules provides for employee termination only after he or she has accumulated six miss-outs. The trial court then reasoned that, because the Arbitrator “found” that three of the Griev-ant’s miss-outs lacked merit, there could be no just cause for Grievant’s discharge because he had not accumulated the required number of miss-outs.
(See
trial ct. op. at 10-12, R.R. at 26a-28a.) YCTA challenges the trial court’s reasoning. Although conceding that the Arbitrator discussed Grievant’s disciplinary history, YCTA asserts that the Arbitrator properly did not review, or make findings on, the merits of Grievant’s first five miss-outs. YCTA acknowledges that deference to an arbitrator’s decision is appropriate in most circumstances; however, YTCA maintains that it is improper to do as the trial court did here and defer to findings that were never made.
We must agree that the trial court has ascribed to the Arbitrator a rationale that simply is not to be found in his opinion. The Arbitrator concluded that YCTA did not have just cause to discharge Grievant; however, contrary to the reasoning attributed to the Arbitrator by the trial court, the Arbitrator did not base that determi
nation on Grievant’s insufficient accumulation of miss-outs. Rather, the Arbitrator reasoned that, although Grievant’s poor work record warranted discipline of some sort, discharge was too severe a penalty to impose. In other words, the Arbitrator found that, notwithstanding the fact that Grievant had amassed six miss-outs, YCTA did not have just cause to discharge Griev-ant because of extenuating circumstances surrounding three of those miss-outs.
YCTA also asserts that the trial court improperly permitted a collateral attack on Grievant’s prior discipline. YCTA contends that Grievant had the opportunity and obligation to challenge the discipline imposed for his first five recorded miss-outs within the time limits set forth in the CBA,
and, because Grievant never did so, Grievant has no right to challenge those previous incidents in this proceeding. In fact, YCTA claims that it has a right to expect that once discipline is imposed and not appealed from, the discipline becomes a permanent part of an employee’s employment record and disciplinary history.
In short, YCTA argues that the Arbitrator lacked authority to examine the circumstances behind any of Grievant’s prior impositions of discipline in determining whether YCTA had just cause to discharge Grievant for a sixth miss-out. Instead, YCTA maintains that the Arbitrator’s role here was confined to determining whether the sixth miss-out on February 12, 1998 occurred and, if so, what contractual remedy applied. We agree that the Arbitrator is barred by time constraints in the CBA from relitigating Grievant’s first five miss-outs, including the propriety of the discipline imposed in those cases;
nevertheless, the Arbitrator’s role is not as limited as YCTA suggests. Indeed, the Arbitrator had no need to review Grievant’s five prior miss-outs in order to determine that YCTA did not have just cause to discharge Grievant for his sixth Shop Rule violation.
YCTA takes a contrary position. Pointing out that Grievant was terminated for accumulating six miss-outs in accordance with section 7.05 of the Shop Rules, YCTA argues that, once the Arbitrator found that Grievant had garnered his sixth Shop Rule violation,
the question of appropriate dis
cipline was a matter reserved by the CBA to YCTA, and, thus, the Arbitrator’s attempt to alter the assessed penalty does not draw its essence from the CBA. As support for this position, YCTA relies on this court’s ruling in
Township of Penn v. American Federation of State, Municipal Employees, AFL-CIO, District Council No. 89,
713 A.2d 1218 (Pa.Cmwlth.1998), and on Article 12, section 4 of the CBA. After considering each of these authorities, we disagree that they preclude the Arbitrator from modifying the penalty imposed by YCTA for Grievant’s six miss-outs.
YCTA asserts that this case is controlled by
Township of Penn,
in which this court held that an arbitrator’s reinstatement of a discharged employee was not rationally derived from the parties’ collective bargaining agreement. Dennis Guy-ton, the grievant in
Township of Penn,
was an employee of the Township’s waste water treatment plant terminated by the Township for willful insubordination and disobedience, an offense subjecting employees to immediate dismissal under the Township guidelines.
The union representing Guyton grieved his termination, claiming it was without just cause, and the matter proceeded to arbitration. The arbitrator found that Guyton’s improper actions justified some type of discipline, but he concluded that, even if Guyton’s conduct constituted willful insubordination to justify termination, the Township could not impose this penalty where another employee guilty of the same offense received a lesser punishment. The York County Court of Common Pleas reinstated Guy-ton’s termination, and we affirmed. We pointed out that the arbitrator assumed that Guyton’s conduct constituted willful insubordination and disobedience, for which discharge was a suitable penalty, and he altered the penalty only because he felt the discipline was unfairly meted out between the two employees. Under these circumstances, we concluded that the arbitrator’s finding of just cause for discipline should have ended the arbitrator’s inquiry. Specifically, we stated:
Here, while the arbitrator found that just cause did exist to discipline Guyton, the arbitrator specifically determined that termination was the improper penalty. However, once the arbitrator determined that Guyton had engaged in the misconduct for which he was terminated so that just cause existed for the Township to discipline Guyton for that conduct, the arbitrator was without au
thority to alter the discipline imposed by the Township in order to obtain what the arbitrator felt was a more suitable result.
Id.
at 1222.
YCTA argues that, just as the arbitrator did in
Township of Penn,
the Arbitrator here determined that YCTA had just cause to discipline Grievant. Thus, under the rationale employed in
Township of Penn,
the Arbitrator exceeded his authority when he continued his inquiry and considered the severity of the punishment imposed by YCTA. YCTA’s argument appears persuasive at first blush. However, we note that, whereas
Township of Penn
involved a discharge for fault-based conduct, Grievant’s discharge stems from a no-fault provision in the CBA. This distinction between fault and no-fault violations is critical because it determines whether an arbitrator is permitted to modify an employer’s punishment where some type of discipline is warranted.
Under an agreement, such as the CBA here, which authorizes the arbitrator to determine whether an employer’s disciplinary action is for just cause, it remains clear that “just cause” cannot be eliminated as an element in the arbitrator’s determination. In fault cases, this just cause determination goes to the employee’s conduct, and the arbitrator considers circumstances that might mitigate against the employee being guilty of the violative conduct with which he or she was charged. Therefore, once the arbitrator finds that the employee engaged in the misconduct for which he was terminated, so that just cause existed to discipline the employee
for that conduct,
the arbitrator is without authority to alter the discipline assessed.
Township of Penn.
In other words, the arbitrator’s finding that just cause existed to discipline the employee ends the inquiry and allows for no penalty reduction.
However, we are faced with a no-fault situation in this case, where a miss-out occurs
anytime
“an operator fails to report for an assignment at the proper time and place, does not report for work, or calls off sick less than one hour before scheduled to report.” Section 4.02.05 of the Shop Rules; Article 30, section 7 of the CBA. Clearly then, the Arbitrator has no discretion to consider mitigating circumstances in a review of the charged conduct.
In such a case, the arbitrator’s just cause consideration must go to determining whether there are mitigating circumstances surrounding the violative conduct that would warrant a reduction of the penalty imposed. To hold otherwise would allow an employer the right to unilaterally create rules that would always avoid review under the just cause standard and, thus, contravene the arbitrator’s function,
assigned by the collective bargaining agreement, to ascertain whether any given set of circumstances constitutes just cause for discharge.
Indeed, the potential for this eventuality is reflected in YCTA’s next argument, where YCTA asserts that, in attempting to modify the penalty for six miss-outs, the Arbitrator was ruling on the merit of a Shop Rule in violation of Article 12, section 4 of the CBA. That section provides:
The power of the arbitrator is limited to the interpretation and application of the specific terms and provisions of the [CBA] and he shall have no power to add to, subtract from, alter, supplement or modify in any way such terms and provisions. The arbitrator’s decision shall be final and binding upon the employees, the Union, and the Employer. A grievance relating to a discharge' or other disciplinary action may be heard by the arbitrator solely to determine if the said discharge or disciplinary action is for just cause,
but he may not rule upon the merit of any shop rule.
(R.R. at 37a.)
Under the interpretation of this language urged by YCTA, an arbitrator is limited solely to determining whether a Shop Rule violation took place. YCTA submits that, if that question is answered in the affirmative, an arbitrator has absolutely no discretion to alter the discipline set forth for a particular violation, even where mitigating circumstances exist, because that would amount to a ruling on the merit of a Shop Rule.
On the other hand, the Arbitrator obviously interpreted this CBA provision quite differently. Although the Arbitrator recognized that Shop Rule violations
might
call for application of the Shop Rule’s progressive disciplinary scheme,
unlike YCTA, the Arbitrator did not automatically equate a ruling that a Shop Rule violation had occurred with a determination of just cause for the discipline imposed. Rather, the Arbitrator clearly believed that he remained free to consider any mitigating circumstances to determine whether the penalty is inappropriate in a particular case. Even if we agreed with YCTA’s contention that the Arbitrator misinterpreted this CBA provision, we lack the authority to overturn the Arbitrator’s decision based upon YCTA’s alternative contract interpretation which would limit the Arbitrator’s authority to a determination of whether a Shop Rule violation took place.
See City of Easton v. American Federation of State, County and Municipal Employees, AFL-CIO, Local 447, 722
A.2d 1111 (Pa.Cmwlth.1998),
appeal granted in part, 558
Pa. 64, 735 A.2d 681 (1999). Where, as rationally interpreted by the Arbitrator here, the CBA does not reserve
the power to select discipline exclusively to the employer,
see County of Centre v. Musser,
519 Pa. 380, 548 A.2d 1194 (1988);
Norristown Educational Support Personnel Association v. Norristown Area School District,
660 A.2d 250 (Pa.Cmwlth.1995), the Arbitrator was free to do as he did here, namely, determine that Grievant’s poor work record, illustrated by his six miss-outs, warranted discipline, but then go on to determine that Grievant’s conduct did not amount to just cause for termination within the meaning of the CBA.
Here, the Arbitrator found mitigating circumstances in reviewing Grievant’s sixth miss-out
and determined that, in light of Grievant’s demonstrated illness, his need for immediate medical care and his month long disability, YCTA did not have just cause, within the meaning of Article 9 of the CBA, to discharge Grievant for his six violations of company policy. As stated, the judiciary must respect the arbitrator’s interpretation of a collective bargaining agreement if, as here, the interpretation can in any rational way be derived from the agreement. Further, the court may vacate an arbitrator’s award only whei’e the award indisputably and genuinely is without foundation in, or fails to logically flow
from,
the collective bargaining agreement.
State System of Higher Education.
The parties here bargained for the opinion of the Arbitrator, and that is what they got. Because that determination is drawn from the essence of the CBA, we affirm.
ORDER
AND NOW, this 25th day of February, 2000, the order of the Court of Common Pleas of York County, dated April 19, 1999, is hereby affirmed.