by Robert W. Steele, Jr. (Fall 2018)

The Illinois Appellate Court for the First District of Illinois recently held that, under narrow circumstances, firefighter residency is not a mandatory subject of bargaining. In Oak Lawn Professional Firefighters Association, Local 3405, v. The Village of Oak Lawn, 2018 IL App (1st) 172079, during negotiations with the Union, the Village introduced various proposals to include a residency requirement for firefighters. Rejecting these proposals, the Union sought to maintain the “status quo,” whereby the labor agreement would continue without such a requirement. Unable to agree on the residency issue and other matters, the parties proceeded to interest arbitration.

From the beginning, the Union maintained that it was under no duty to bargain any residency requirements. The Union argued that the Illinois Municipal Code (“Code”) already addressed whether a residency requirement could be imposed on current employees. Under the Code, during a firefighter’s period of service, residency requirements cannot be made more restrictive than they were “at the time an individual enters the fire service for a municipality.” 65 ILCS 5/10-2.1-6.3(c). To the Union, any residency requirement for current firefighters would qualify as “more restrictive.”

In contrast, the Village maintained that the Union had a duty to bargain residency requirements. The Village argued that   Section 14(i) of the Illinois Public Labor Relations Act (“Act”) controlled the issue. Under the Act, an interest arbitrator’s decision is limited to “wages, hours, and conditions of employment,” including residency requirements, but awards that allow out-of-state residency requirements are prohibited. 5 ILCS 315/14(i).

The Union objected to the issue going before the arbitrator, stating that residency was not a mandatory subject of bargaining under these circumstances. As permitted by the administrative regulations of the Illinois Labor Relations Board (“ILRB”), the Village petitioned the general counsel of the ILRB for a declaratory ruling that residency is a required subject of bargaining. The general counsel agreed with the Village, further reasoning that – under the Code – having no residency requirement is not the same as having an affirmative residency requirement already in place. In addition, the general counsel’s ruling commented that contractual silence would amount to “no residency restriction at all,” meaning an arbitration award granting the Union’s status quo proposal would permit out-of-state residency in violation of the Act.

After the general counsel’s ruling, the arbitrator issued an interest arbitration award in favor of the Village’s residency requirement. While waiting on the award, the Union, on behalf of three out-of-state members filed a declaratory action in circuit court. The Union alleged that the arbitrator exceeded his authority by issuing an award that violated the Code by imposing a residency requirement more restrictive than what was in effect when the members were hired. The circuit court agreed with the Union and issued summary judgment in its favor. The Village subsequently appealed.

On appeal, the First District primarily held that Section 7 of the Act – which outlines the parties’ duty to bargain collectively – controls in negotiations over “matters with respect to wages, hours, and other conditions of employment” that are “not specifically provided for in any other law.” Siding with the Union, the First District found that Section 10-2.1-6.3(c) of the Code qualified as “a law” applicable to residency requirements specific to firefighters serving municipalities. In turn, the Union had no duty to bargain over residency because the Code provides for the rights of such firefighters on whether residency requirements may be made more restrictive during their period of service.

The First District then proceeded to refute the Village’s alternative arguments. The First District held that the Village’s home rule authority – the state constitutionally protected broad exercise of power and functions related to government and affairs – was specifically limited by the General Assembly. Section 10-2.1-6.3(a) of the Code contains various provisions on how the Code applies to municipalities in addressing the administration of the firefighter hiring process, regardless of home rule authority. For example, Section 10-2.1-6.3(a) states in pertinent part that a home rule municipality “may not administer its fire department process for original appointments in a manner that is less stringent than this Section. This is a limitation Subsection 6(i) of Article VII of the Illinois Constitution . . . ”.   According to the First District, the legislature intended to deny home rule authority units from imposing residency requirements on current firefighters that are “more restrictive” than those requirements in place at the time employment began.

The First District also rejected the Village’s argument that the absence of a residency requirement is not itself a residency requirement in the meaning of Section 10-2.1-6.3(c). The Village maintained through nearly all proceedings that a municipality cannot impose a “more restrictive” residency requirement on current firefighters when the requirement did not exist in the first place.

In reading Section 10-2.1-6.3 as a whole and construing the “in effect at the time” phrase in context, the First District found that the Code established a default rule of appointment open to all applicants. Under subsection (c), the firefighter appointment process is open to all applicants unless the municipality, by ordinance, limits applicant residency to the “municipality, county or counties in which the municipality is located, State or nation.” 65 ILCS 5/10-2.1-6.3(c). The First District reasoned that the legislature’s use of residency requirements in effect at the time of entering fire service referred to whether the municipality allowed the default rule of appointment open to all applicants to stand or limited applicants to residents within a geographic area.

The First District ultimately held that Section 7 of the Act controlled in regards to the duty to bargain and that Section 10-2.1-6.3 of the Code applies as a law specifically providing for the residency requirement. In turn, residency was not a mandatory subject of bargaining, should not have been considered by the interest arbitrator under Section 14(i) of the Act, and the arbitrator’s decision would not have included “residency requirements . . . that allow residency outside of Illinois” in the first place. (5 ILCS 315/4(i)).

The ruling in this case was nuanced and required heavy statutory analysis. The lesson remains clear – never assume that an issue is a mandatory subject of bargaining. The Illinois Public Labor Relations Act works in conjunction with numerous other laws that can greatly impact the outcome of a dispute over collective bargaining negotiations. Even the absence of statutory language can be construed as an affirmative rule or requirement imposed by and upon a unit of local government. Employers should always proceed with caution during negotiations when approaching potential impasse and interest arbitration.