I. The City’s Negotiating Team
The City’s Negotiating Team Knew or Should Have Known that the Superiors’ Contract Would Result in Significant Raises for Superior Officers.
When the City assembled a negotiating team for the Superiors’ Contract, all members of that team owed duties of care and due diligence to the residents of Methuen to ensure that the contract was in the City’s best interest. For example, under Article V of the Massachusetts Declaration of Rights, all governmental officials in the Commonwealth, as agents of the people, should “work with an eye single to the interest” of the public.47 The City’s negotiating team did not fulfill its responsibilities to the residents of Methuen.
From the beginning of the negotiations, the superiors’ union sought to include various stipends, allowances and incentives into the definition of base pay. The union also sought to increase certain stipends and to add new allowances (see Finding II above). The City’s negotiating team knew of these requests and questioned the cost of changing the definition of base pay. Nevertheless, the team never actually determined the financial impact of any of the proposed changes. For instance, the city auditor could have analyzed the financial impact of the changes the union requested, but team declined to request his analysis, either during the negotiations or before the City Council voted on the contract.
Furthermore, much of the difficulty of the Superiors’ Contract stems from the fact that the contract lacked a salary schedule outlining the base pay that each rank or each officer would receive each year. Such a schedule would have disclosed the total cost associated with the multiple increases the City agreed to.
The City could have (and should have) determined the cost of the contract prior to agreeing to it. Moreover, had the City’s negotiating team demanded the inclusion of a salary schedule, the full impact of the contract changes would have been clear to the City and the people of Methuen. The City’s negotiating team failed in its responsibilities to the residents of Methuen. Additional investigative conclusions regarding Chief Solomon are set forth in Section V below.
II. Mayor Zanni Breached His Obligations to the City and the Public.
Upon taking office, Mayor Zanni swore an oath to faithfully discharge his duties.48 Moreover, as an elected representative, the mayor is a “‘substitute[ ] and agent[ ] of the people who [should] act only in their interest.”49 Stated differently, the mayor owed the citizens the same duties a trustee owes beneficiaries.50 Moreover, a mayor is responsible for spending taxpayer funds appropriately and in the best interest of the city’s residents.
Throughout 2017, Mayor Zanni ignored his obligations by entering into two costly police contracts on behalf of the City. He also failed to exercise due diligence and care regarding the Superiors’ Contract because he:
- did not read the contract before signing it;
- did not ask the City’s attorney to review the contract;
- told the City Council – inaccurately – that the only increase in the contract was a cost-of-living adjustment; and
- neglected to take notes or otherwise keep records related to the contract negotiations.
First, Mayor Zanni entered into a contract with Chief Solomon that was one-sided, in favor of the Chief.
When Mayor Zanni negotiated the contract extension with Chief Solomon in 2017, he agreed to pay the police chief more than the New York Police Commissioner, Boston Police Commissioner, Massachusetts State Police Colonel, Chicago Superintendent of Police and Los Angeles Police Commissioner.
| Police Chief | 2018 Salary |
|---|---|
| New York City Police Commissioner | $226,366 |
| Boston Police Commissioner | $238,846 |
| Massachusetts State Police Colonel | $241,845 |
| Chicago Superintendent of Police | $260,004 |
| Los Angeles Police Commissioner | $371,076 |
| Chief Solomon | $375,548 |
Further, Mayor Zanni agreed to pay the Chief each and every stipend, allowance, incentive and leave benefit that any patrol officer or superior officer in the department receives. This means that he receives all extra pay and every leave benefit that the patrol officers receive plus all extra pay and every leave benefit that the superior officers receive.
Beyond its cost, the contract lacks basic protections for the City and is void of meaningful oversight. For instance, Mayor Zanni agreed to an extensive discipline process that favors Chief Solomon. If he “unwillingly resigns,” moreover, the contract states that the City must pay Chief Solomon the balance of his contract, regardless of the cause for the resignation.
Furthermore, the contract permits Chief Solomon to earn compensatory time when he works outside of his “regular business hours.” Given both his position as a department head and his unprecedented salary, the decision to allow Chief Solomon to earn compensatory time is questionable at best.51 Even assuming that it is appropriate for him to earn compensatory time, the contract does not specify what regular business hours the chief must work. This gap gives Chief Solomon the opening to decide when he is working “regular business hours” and when he is working “overtime.”
Furthermore, the contract does not require Chief Solomon to get prior approval before working “overtime” or to report his time to the mayor or City Council. Similarly, Mayor Zanni agreed that the City would pay for Chief Solomon to attend the trainings and conferences of his choosing, but the mayor failed to include any oversight language.
Mayor Zanni negotiated a five-year contract with a salary structure exceeding that of any police chief in Massachusetts or most of the United States. He failed to include basic oversight mechanisms and agreed to expensive and one-sided contract terms. In short, Mayor Zanni violated the most basic fiduciary duties he owed the City: protect the public’s interests and spend the City’s funds appropriately.
Second, Mayor Zanni agreed to the Superiors’ Contract, which was even more expensive than Chief Solomon’s.
Months after agreeing to Chief Solomon’s contract extension, Mayor Zanni agreed to a second, more costly, agreement in the form of the Superiors’ Contract. Mayor Zanni’s most fundamental obligation was to understand the financial impact of the Superiors’ Contract to the City, yet he took virtually no steps to understand it. While the City’s negotiating team did question the cost of some proposed contract changes, Mayor Zanni did not press the superiors’ union to answer those questions (and often the union representatives did not).
Further, while Mayor Zanni did ask the city auditor to assess the cost of a single provision (the cost-of-living adjustment), he did not inform him that he had agreed to change the definition of base pay. Any estimate the city auditor provided to Mayor Zanni was incorrect because of that omission. Moreover, Mayor Zanni did not look to surrounding communities or communities of similar size to determine whether the terms of the Superiors’ Contract were appropriate for a police department the size of Methuen’s.
Third, Mayor Zanni failed to ensure that the Superiors’ Contract accurately reflected the terms the parties had agreed to in multiple negotiation sessions.
Mayor Zanni did not read the entire contract before signing it. Nor did he compare the contract against the notes of the negotiation to confirm the contract contained the correct dollar figures or language. He did not review the final version of the contract against the prior drafts to ensure that it encompassed the terms he agreed to during the negotiations.
Fourth, Mayor Zanni failed to have the city solicitor review the Superiors’ Contract.
That is, Mayor Zanni did not have the City’s chief legal officer review a multi-million-dollar contract to ensure that it accurately represented the agreement of the parties, as well as to ensure that its terms were legal, clear and protective of the City’s interests.
Fifth, Mayor Zanni failed to inform the public and City Council of the contract changes he agreed to on behalf of the City.
Mayor Zanni told the City Council that the only cost increase in the Superiors’ Contract was a cost-of-living adjustment. As previously discussed, Mayor Zanni knew that he agreed to changes that increased the superior officers’ total compensation. Throughout a series of negotiations, Mayor Zanni agreed to changing the definition of base pay, changing or increasing various stipends and (on his own initiative) increasing the rank differentials. Mayor Zanni never told the City Council about these new or changed provisions.
Sixth and finally, Mayor Zanni failed to keep any records related to the contract negotiations, including notes from the drafting and signature phases.
Mayor Zanni did not take notes during the negotiation sessions. This is especially significant because each session included new concessions by the City. Similarly, Mayor Zanni did not communicate in writing with the superiors’ union regarding the negotiations or the contract.
Mayor Zanni explained to the OIG that he relied on other members of the City’s negotiating team to take notes. However, he took sole responsibility for the drafting and signature phases of the negotiations, meaning there were no other team members present to take notes.
Records regarding any conversations or agreements must be kept to accurately reflect the negotiation process. Negotiations conducted by telephone or during in-person meetings must be documented with some form of writing. Mayor Zanni failed this fundamental obligation.
The mayor is the City’s chief executive and a fiscal steward of the City’s funds. He owes a duty of care and due diligence in the decisions he makes for the City, and he should be transparent and honest with the City’s residents. As set forth above, Mayor Zanni failed all of these obligations to the City and its residents with respect to both Chief Solomon’s contract and the Superiors’ Contract.
III. The City Solicitor May Have Breached His Duty of Care to the City.
In Methuen, the City Charter creates the position of city solicitor. The City Council hires the city solicitor, who is responsible for providing legal representation and advice to the City. The city solicitor has a duty to “represent the municipality in all court matters, advise the City Council and municipal boards and officers upon all legal questions and perform such other duties as the City Council may prescribe in addition to such duties as may be prescribed by law.”52
The Methuen City Ordinance also requires the city solicitor to “[p]repare for execution of all contracts and instruments to which the City is a party....”53 As part of his reasonable care, the city solicitor also participates in contract negotiations to ensure that the City’s contracts accurately contain the parties’ agreements, protect the City’s interests, contain enforceable provisions and safeguard the City from costly litigation.
The city solicitor also owed a duty of care to his client, the City, because of the attorney-client relationship between the solicitors and the City. “The standard of care normally applied is whether the lawyer failed to exercise reasonable care and skill in handling the client’s matter....”54 The relationship between an attorney and their client is also fiduciary as a matter of law.55 One of the basic obligations of an attorney in contract drafting is to ensure that it accurately reflects the agreements and that the language is enforceable.
During the negotiations for the Superiors’ Contract, the city solicitor advised Mayor Zanni to have the superiors’ union draft the new contract. The advice is understandable. If a dispute later arose regarding a contract clause, the superiors’ union could not accuse the City of misstating the agreements made during negotiations.
Pursuant to his obligation to “[p]repare for execution of all contracts and instruments to which the City is a party,” however, the city solicitor should have reviewed the Superiors’ Contract to ensure it accurately reflected the agreements made during negotiations.56 That did not happen here. The city solicitor never requested or reviewed any drafts of the contract.
In addition, he received the signed copy of the Superiors’ Contract before the City Council meeting on September 18, 2017. Nevertheless, he did not review the contract – or ask the assistant city solicitor to review it – before the City Council voted on the contract. Nor did the city solicitor tell the City Council that he had not reviewed the contract, either in draft or final form.
In this case, a line-by-line review of the Superiors’ Contract would have revealed the inclusion of the Gallant Formula and that Captain Gallant had added the educational incentive to the definition of base pay. The city solicitor also would have discovered that Captain Gallant had revised the provisions on holiday compensation (Article XII), uniform allowances (XVII, Section 2) and the protective vest stipend (Article XXIX, Section 25) to further emphasize that those items were included in the contract’s definition of base pay.
Additionally, the city solicitor would have recognized that Captain Gallant did not follow the parties’ agreement with respect to the protective vest stipend (Article XXIX, Section 25).
Once the impact of the Superiors’ Contract came to light, moreover, the city solicitor still did not review his contract notes or even the contract. Mayor Jajuga entered into MOU discussions with the belief that Mayor Zanni had agreed to all of the provisions in the Superiors’ Contract, and he negotiated the MOU accordingly. Had the city solicitor reviewed the contract or his notes, he would have known during the MOU discussions that the City never agreed to several costly terms, including the Gallant Formula.
IV. Captain Gallant, as Union President, Acted in Bad Faith.
Captain Gallant, as Union President, Acted in Bad Faith by Changing Certain Language in the Contract that Was Not the Product of Bargaining and Remaining Silent During the MOU Discussions.
A. Legal Background.
When negotiating a collective bargaining agreement, both parties have a statutory obligation to act in good faith. Specifically, in Massachusetts, certain public employees have the right to organize and collectively bargain with their employer.57 Under Chapter 150E of the General Laws, “the employer and the exclusive [union] representative shall meet at reasonable times . . . and shall negotiate in good faith with respect to wages, hours, standards or productivity and performance, and any other terms and conditions of employment . . . .”58 Chapter 150E defines “employer” to mean a city’s chief executive officer and “any individual who is designated to represent one of these employers and act in its interest in dealing with public employees. ”59
The statute further provides that “the relevant unions are the employees’ exclusive representative… for the purpose of collective bargaining… and are empowered to act on the employees’ behalf with respect to wages, hours, standards or productivity and performance, and any other terms and conditions of employment…”60
Under Chapter 150E, “good faith” implies an open and fair mind as well as a sincere effort to reach a common ground.61 Both the union and the employer have a duty to negotiate in good faith.62
B. Discussion.
Captain Gallant knowingly included language in the Superiors’ Contract that the City had not agreed to. By adding language that the parties did not agree to and not disclosing that fact to the City’s negotiating team, Captain Gallant acted in bad faith. Moreover, when Mayor Zanni asked him to add the cost-of-living adjustment to the contract, Captain Gallant made even more changes that the City had not agreed to. Further, he never told Mayor Zanni about these changes, which significantly increased the superior officers’ total compensation.
Captain Gallant’s state of mind is demonstrated most clearly through the email he sent to the Superior Unions’ attorney after he inserted the Gallant Formula. He stated, in part, “I foresee, Because of the large increases in pay, having to litigate the wording. Can you check especially the compensation warning [sic] to guarantee as much as possible that we will be strong.”
Further, when he added the Gallant Formula, Captain Gallant manipulated the line spacing so the rest of the pages in the contract – including the signature page – did not change. This helped conceal the fact that he had inserted new language that the City had not bargained.
Finally, even though Captain Gallant represented the superiors’ union during the MOU discussions, he did not tell Mayor Jajuga that the contract contained terms the City had not negotiated. Moreover, he told the OIG that he did not mean to include subordinate officers’ educational incentive in the definition of base pay. Nevertheless, he remained silent about this during the MOU discussions.
Captain Gallant’s actions with respect to the draft contract and MOU demonstrate an attempt to take advantage of the City. Though his obligation was to represent the superiors’ union members, he still had to negotiate with the City in good faith. He failed to do so.
V. Chief Solomon Breached His Duty to Provide Adequate Public Safety.
Chief Solomon Breached His Duty to Provide Adequate Public Safety by Remaining Silent to the Deception of Captain Gallant.
Chief Solomon owed a responsibility to the mayor to be immediately responsible for the effective administration of the police department.63 Additionally, Chief Solomon swore to “faithfully perform the duties of the office of the Methuen Police Department…”64 Chief Solomon, through the mayor and City Council, received a budget financed by Methuen taxpayers. Therefore, he owed the duty to act as a fiscal steward of those funds to ensure the department provided public safety in the best interest of the citizens.
When Chief Solomon remained silent about the insertion of the Gallant Formula and the other unbargained-for provisions in the Superiors’ Contract, he abandoned his duties. Chief Solomon sat through every session of the negotiations with the superiors’ union. He participated in discussions regarding the cost of certain additions to the Superiors’ Contract and provided recommended language.
Most significantly, he knew about the Gallant Formula and its impact on salaries – as evidenced by the fact that he emailed it to the president of the patrol officers’ union within two and a half hours of receiving it from Captain Gallant. Yet he did not alert Mayor Zanni to the change. Instead, he not only remained silent about its insertion, he told the patrol union to include it in their contract, knowing it would enhance his own pay.
Moreover, when Mayor Jajuga publicly announced the cost of the Superiors’ Contract in April 2017, Chief Solomon still remained silent. Further, he sat through MOU negotiations, providing cost analyses on behalf of the superiors’ union (see Appendix 4), and continued to remain silent, never informing anyone that the City had not agreed to the Gallant Formula or other costly provisions in the contract.
When the City Council refused to provide additional funds to finance the MOU, Mayor Jajuga announced layoffs of over half the police officers in the police department. Even then, though his duty as chief of police was to provide the residents of the Methuen with the best public safety given the available funds, he still elected to remain silent. Not only did his silence permit Captain Gallant’s transgression to go uncovered, it also risked the public safety of the Methuen residents.
Chief Solomon chose his own interests over the safety of the public.
VI. Chief Solomon Did Not Act in the Best Interests of the City.
Chief Solomon Did Not Act in the Best Interests of the City and May Have Had a Conflict of Interest.
Chief Solomon’s role in both the patrol officers’ and superior officers’ negotiations was to provide police expertise to the City. However, Chief Solomon went well beyond advising the mayor, and instead he acted to benefit the patrol officers’ union and himself. Section 19 of Chapter 268A of the General Laws prohibits a municipal employee from participating as a public employee in a particular matter in which he has a financial interest. The term “participate” includes making a recommendation and rendering advice.65 The term “particular matter” includes contract negotiations.66
Moreover, courts have cautioned against police chiefs serving as a city’s “designated representatives” during negotiations with police unions because chiefs “might have a conflict of interest because their own salaries may be affected by the salaries negotiated in the bargaining process.”67
As discussed above, Chief Solomon shared the Gallant Formula with the patrol officers’ union and suggested that they include it in their contract. Because Chief Solomon’s salary is tied to the patrol officers’ contract, no one gained more from this change than Chief Solomon did (see Finding XI). Finally, Chief Solomon’s contract also entitled him to receive every incentive, stipend, allowance and leave benefit paid to any patrol officer and superior officer.
As a result, Chief Solomon had a direct personal interest in the patrol officers’ and the superior officers’ contracts. By his conduct, he put those interests above those of the City and the people of Methuen. He also likely violated the conflict-of-interest laws by participating in the negotiations of both police contracts.
Contact for OIG Report 2020: Leadership Failures in Methuen Police Contracts Investigative Conclusions
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| Date published: | December 23, 2020 |
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