The contract splits the appeals process in two — one procedure for grievances, such as labor violations, and another for appealing discipline more severe than a letter of reprimand, such as suspension or termination.
The city and union would now be able to select an arbitrator from a pool of retired San Mateo County judges, according to the contract. But the arbitrator's decision would still be final.
The proposed contract also sets retirement benefits for new police employees at 2.7 percent of their highest salary at age 57 — for current officers it's 3 percent at 50.
As a result of the reduced benefits, police employees hired after Jan. 1 will pay 11.5 percent into CalPERS; current employees pay 12 percent, Assistant City Manager Starla Jerome-Robinson said.
The city would establish a management advisory committee that would meet quarterly, and implement an employee recognition program to recognize exemplary performance.
Council members described the proposed changes as a move toward long-term financial sustainability for Menlo Park. Although in the past, all council members expressed an interest in changing binding arbitration, council members said it's only one of many items to modify in the interest of improving the city's the long-term future.
Don't assume the council thinks the new process is preferable to getting rid of binding arbitration, Councilman Rich Cline said, noting that many cities in the region use binding arbitration to resolve disciplinary matters.
"Ultimately, we feel good that both parties were able to find common ground regarding selection of an arbitrator that ensures selection of a competent local arbitrator," Mr. Cline said. "The result for Menlo Park will be an improved and more honest arbitration selection process and a more sustainable arrangement in terms of long term obligations on the city's finances. But more importantly, it means we have a strong leadership team within our police department to keep doing the great work we have come to expect."
Councilman Ray Mueller said the change keeps litigation expenses down while eliminating one of the major drawbacks of binding arbitration.
"This is a terrifically positive term change in the interest of justice," Mr. Mueller said, because now the city could have disciplinary appeals heard by local judges instead of "an out-of-towner who makes a living by cozying up to employers and/or labor unions."
The Almanac broke the story earlier this year about the arrest, firing and reinstatement of veteran Menlo Park police officer Jeffrey Vasquez. The veteran police officer, fired after being caught naked with a prostitute in a motel room and reportedly admitting that wasn't the first time he'd solicited a hooker for sex, was reinstated through binding arbitration and awarded $188,000 in back pay.
Were the Vasquez case to occur under the new arbitration process, it would end the same way should the arbitrator rule to revoke the officer's termination.
Binding arbitration decisions in police misconduct remain confidential unless both parties agree to release the information. The Almanac obtained 17 redacted decisions from multiple California jurisdictions. The reversal rate? About 59 percent. Arbitrators reinstated the officers nine times, and shortened one suspension. They upheld terminations in the remaining seven cases.
Academic studies of similar binding arbitration cases in Chicago and Houston show approximately the same reversal rate.
How much impact will selecting retired local judges as arbitrators have?
"I don't think this changes the fact that arbitration decisions are binding, regardless of whether the arbitrator gets it wrong on the facts, or wrong on the law," said Arthur Hartinger, an attorney with Meyers & Nave who specializes in representing public employers.
He said there is an argument that retired judges will run a more formal hearing, and be more careful to ensure that findings are supported by the evidence. A retired San Mateo County judge could also be more closely attuned to issues affecting local residents.
"But as I've said before, there are good arbitrators, and there are weak arbitrators. The same is true of judges," Mr. Hartinger said. "In the end, the quality of the hearing and final decision will depend on who is ultimately selected, and not whether someone was a judge or is a professional arbitrator."
Labor attorney Monna Radulovich of Wiley Price & Radulovich said that an arbitration hearing in which a retired judge serves as the arbitrator is a good option to satisfy due process requirements as well as safeguarding an officer's rights as required by state law throughout the disciplinary process.
The Menlo Park council is scheduled to vote on the proposed contract on Aug. 20.