Tuesday, December 11, 2007

Board Issues First Decision Under Trial Court Interpreter Act

Santa Cruz County Superior Court (PERB Dec. No. 1931I ) (Issued 11/29/07)

The Board has issued its first decision under the Trial Court Interpreter Employment and Labor Relations Act (TCIELRA) (Gov. Code, §71800 et. seq.). The decision itself did not break any new legal ground. However, the Board did confirm that in interpreting the TCIELRA it will generally follow decisions issued under the other PERB-administered statutes (Dills, EERA, HEERA, MMBA) and the NLRA.

Board Reverses ALJ Decision; Finds No Joint Employer Relationship

Los Angeles Unified School District (PERB Dec. No. 1930E) (Issued 11/28/07)

This case involved allegations of retaliation brought by two teachers against the San Jose/Evergreen Community College District (District). The two teachers taught classes offered by the South Bay Regional Public Safety Training Consortium (Consortium), which was a joint powers agency between the District and Gavilan Community College District. The issue before the Board was whether the District was a joint employer, together with the Consortium, of the teachers.

The ALJ, relying on the Board’s decision in Ventura County Community College District (2003) (PERB Dec. No. 1547), held that the District was a joint employer of the two teachers. In finding a joint employer relationship, the ALJ relied heavily on the fact that the documents creating the consortium stated that the teachers would be considered employees of the member districts. The Board majority reversed the ALJ decision, finding that the “District’s initial acts of control over the Charging Parties fail to meet the level of substantial control necessary to support a finding of a joint employer relationship in this case.” While acknowledging that the operational documents of the consortium listed the member districts as the employer of the teachers, the majority focused on the undisputed fact that the consortium had been hiring teachers directly for some time. According to the majority, “the key inquiry in joint employer cases is the level of actual control exerted over the shared employees.”

The majority’s reversal of the ALJ’s decision drew a rare dissent. The dissent argued that the majority’s opinion would create an “unwarranted safe harbor for the District, which would otherwise be subject to the jurisdiction of the EERA.” According to the dissent, the purposes of EERA would be frustrated if the Consortium could ignore the terms of its operational documents which provide that the member districts are the employers of the teachers.

The result in this case was based heavily on the specific facts. However, since the creation of joint powers agencies is becoming more common, public agencies should take note of the lessons here. This case (which very likely will be appealed) serves as a warning to employers that what you say on paper is not as important as what you actually do. Similar to disputes over whether someone is an employee versus an independent contractor, whether an agency will be found to be a joint employer will rest primarily on the actual right of control the agency exerts over the employees.

Monday, October 15, 2007

AB 220 - Firefighter Bill of Rights Signed

In one of the most shocking developments this legislative year in the labor and employment area, the Governor signed AB 220 - the Firefighter Bill of Rights (FBOR). The newly enacted statute gives firefighters the same basic rights as peace officers under the Peace Officer Bills of Rights (POBAR). The requirements of AB 220 include:

* Specifying the conditions under which investigations and interrogations that may lead to punitive action of firefighters must be conducted;
* Requiring that any punitive action against a firefighter be taken within one year of discovery;
* Requiring that a firefighter be allowed to read and sign any adverse comment before it is entered into their personnel file.
* Prohibiting forced lie detector tests of a firefighter;
* Specifying that a firefighter cannot be required to disclose financial information unless otherwise required by law or court order;
* Requiring that a fire chief, prior to removal, must be provided with written notice stating the reasons for removal and an opportunity for administrative appeal;
* Allowing a firefighter's locker or other storage space to be searched only in the firefighter's presence, or with their consent, or with a valid search warrant.

While there may be sound public policy reasons for POBAR, it is difficult to fathom why firefighters need the same protections. Amazingly, AB 220 received almost full Republican support in the Assembly, and that support likely explains why the bill was signed.

Friday, October 12, 2007

Rialto Police Benefit Assn. v. City of Rialto

Rialto Police Benefit Assn. v. City of Rialto (Court of Appeal Case No. E039649) (Issued 10/3/07)

This case arose under the Meyers-Milias-Brown Act and presented an issue of first impression: Is a city’s decision to enter into a contract with the county sheriff for law enforcement services, rather than continue to provide such services through the city’s own police department, subject to the meet and confer requirements of the Meyers-Milias-Brown Act (MMBA) (Gov. Code, § 3500 et seq.)? The court answered in the affirmative.

More on this case later.

Thursday, September 27, 2007

Good News: AB 553 Vetoed

If enacted, AB 553 would have denied cities and counties the right to seek injunctions directly with the courts when faced with strikes affecting health and safety. Fortunately, the bill was vetoed. Here is the Governor’s message:

To the Members of the California State Assembly:

I am returning Assembly Bill 553 without my signature. This bill would provide the Public Employment Relations Board (PERB) with exclusive authority to determine whether public health and safety would be at risk in strike or lockout situations. Doing so would add an unnecessary layer of bureaucracy and potentially place the public at risk. Cities and counties have common law and statutory authority over matters of public health and safety. When local governments seek injunctive relief from a strike, they are doing so because of a potential threat to the public health and safety of citizens. It is therefore imperative that local governments have access to immediate injunctive relief from superior courts during strike situations. As the courts are sufficiently suited to address matters of public health and safety, there is no reason to force decisions on injunctive relief into the slower PERB process. For these reasons I am returning this bill without my signature.

Arnold Schwarzenegger

Monday, August 20, 2007

District's Ability to Regulate "Politcal Speech" is Limited

Desert Community College District (PERB Case No. 1921-E) (8/10/07)

PERB held that a community college district violated the Educational
Employment Relations Act (EERA) when it attempted to prohibit one of its unions from discussing a Board of Trustees election at a union meeting held on campus.

The key issue was whether the district’s conduct was justified by the Education Code, specifically sections 7054 and 7055. Section 7054 prohibits the use of district "funds, services, supplies, or equipment" to support or oppose ballot measures and/or candidates. PERB found this language inapplicable since the union was using the district’s “facilities.” PERB also found section 7055 - which allows a college to adopt rules and regulations governing "(p)olitical activities on the premises of the local agency" - to be inapplicable as the district had failed to adopt any such rules or regulations.

Arguably, PERB took a narrow view of the section 7054 prohibition on using “services, supplies or equipment” to support candidates. However, key here is the fact that the union’s meeting was in a non-instructional setting. Also, there were no facts suggesting that the union’s use of the district’s facilities would be interpreted as an endorsement of the union’s speech. Given these facts, PERB would have likely reached the same conclusion even if the district had adopted rules under section 7055.

Monday, July 30, 2007

50% Participation Rule Deemed Unreasonable

County of Imperial (PERB Dec. No. 1916M) (Issued 6/28/07)

At issue in this case was a local rule requiring that in a representation election, a majority of the employees in the bargaining unit must vote in order for the vote to be valid. PERB held that the rule was “unreasonable” under the MMBA. In reaching its decision, PERB compared the language of MMBA section 3507.l (a) and 3502.5(d). The former section states that a majority of votes cast in representation elections is required, not that a majority of employees must vote. In the latter section - governing rescission elections - the language expressly requires a majority of unit employees to vote. Because the Legislature expressly required majority participation in certain elections and not others, PERB held that a local rule setting different requirements was unreasonable.

This case is one of the first PERB cases finding a local rule to be “unreasonable” under the MMBA. The holding here can be interpreted to set the statutory language of the MMBA as a baseline for evaluating reasonableness. Local rules that deviate or frustrate the MMBA’s statutory provisions will almost certainly be found unreasonable. For example, MMBA section 3507.1 now allows for the establishment of majority support through ‘card check.’ A local rule that ignores ‘card check’ or requires some other kind of election can be expected to be found unreasonable.

Tuesday, July 3, 2007

Retirement Health Benefits for Current Employees Negotiable

Madera Unified School District (PERB Dec. No. 1907E) (Issued 5/25/07)

Under the statutes administered by PERB, it has been generally understood that retirement benefits for current employees are within the scope of representation and thus must be negotiated. Benefits affecting current retirees, however, have been understood to be a permissive topic of bargaining.

In this case, the union alleged that the employer unilaterally changed the way it calculated its monetary contribution towards health care for retirees. The Board agent dismissed the charge on the ground that the alleged change did not affect any current employees and any changes to the benefits of current retirees were not within the scope of representation – they were rather a permissive subject of bargaining.

The Board generally affirmed the Board agent’s analysis that only benefits for current employees are within the scope of representation. However, the Board held that any changes to retiree benefits are still negotiable to the extent they affect what current employees will receive in the future.

The Board’s decision is potentially problematic in several respects. First, the Board’s holding has the potential to swallow the rule that benefits for retirees are a permissive subject of bargaining. This is because almost any change to the current benefits of retirees arguably affects the future benefits of current employees.

The decision also raises an interesting question regarding remedies. Consider what would have happened had the Board found a violation. By its own admission, the Board would have no jurisdiction to order a remedy for current retirees, who were the only individuals affected by the alleged conduct. The Board could only order a remedy as to current employees; but here they suffered no harm. Presumably, the Board could order the change rescinded as it applied to the future benefits of current employees. In order words, the Board could order the employer to restore the promised benefit for current employees. However, how would the Board ever enforce such a promise? The employer’s promise would not become actionable until the current employee retired; but once that occurred, the Board would again lose jurisdiction!

This is not to say, of course, that employers can freely renege on promised benefits. There are certainly other avenues of enforcement. The point is that this issue is not one that lends itself to PERB enforcement.

Right of Individual Representation Restored Under EERA

On June 28, 2007, the Governor signed AB 1194 (Karnette) which restores language in EERA section 3543 granting individuals a protected right of representation. In 2000, for reasons never explained (in reality, it was most likely a careless drafting error), the Legislature deleted the following language from EERA when it approved unrelated amendments:

Public school employees shall also have the right to refuse to join or participate in the activities of employee organizations and shall have the right to represent themselves individually in their employment relations with the public school employer, except that once the employees in an appropriate unit have selected an exclusive representative and it has been recognized pursuant to Section 3544.1 or certified pursuant to Section 3544.7, no employee in that unit may meet and negotiate with the public school employer.

Based on the deletion of this critical language, PERB held in Woodland Joint Unified School District (2004) PERB Dec. No. 1722E, that the Legislature must have intended to eliminate the individual right of representation under EERA. Even if the Legislature did not so intend, PERB held that because of the change in statutory language, it was the Legislature's responsibility to correct the error. Accordingly, PERB held that prior cases recognizing such a right (See Pleasant Valley School District (1988) PERB Dec. No. 708) were no longer valid in light of the change to section 3543.

Sponsored by the California Teachers Association, AB 1194 was intended to restore the individual right of representation under EERA and to statutorily abrogate PERB’s decision in Woodland Joint Unified. Under AB 1194, the following language has been added to section 3543:

Public school employees shall have the right to represent themselves individually in their employment relations with the public school employer, except that once the employees in an appropriate unit have selected an exclusive representative and it has been recognized pursuant to Section 3544.1 or certified pursuant to Section 3544.7, no employee in that unit may meet and negotiate with the public school employer.

Note that AB 1194 does not completely restore the language that was deleted in 2000. Not surprisingly, CTA did not see fit to restore the individual right to “refuse to join or participate in the activities of employee organizations . . .”

Monday, June 18, 2007

Washington’s ‘Paycheck Protection’ Law is Constitutional

Davenport v. Washington Ed. Assn. (US 05-1589 and 05-1657) (Decided by Supreme Court on 6-14-07)

Washington State allows public-sector unions to charge nonmembers an agency fee equivalent to membership dues and to have the employer collect that fee through payroll deductions. An initiative approved by state voters requires a union to obtain the nonmembers’ affirmative authorization before using their fees for election-related purposes. The issue before the Supreme Court was whether requiring unions to obtain affirmative authorization violated the Constitution. The Supreme Court held that it does not violate the First Amendment for a State to require its public-sector unions to receive affirmative authorization from a nonmember before spending that nonmember’s agency fees for election-related purposes.

Wednesday, June 6, 2007

AB 553 - Passes Assembly

AB 553 - which purports to give PERB exclusive initial jurisdiction over public employee strikes - has passed the Assembly and is on its way to the Senate.

Friday, May 11, 2007

Is There an Implied Right of Access under the MMBA? Answer Still Unknown.

City of Porterville (PERB Dec. No. 1905M) (Issued 5/10/07)

All the statutes administered by PERB have differences in statutory language. Despite these differences, PERB has generally interpreted the statutes the same absent clear legislative intent to the contrary. Thus, a decision regarding the right to representation under EERA would also be applicable under HEERA, Dills, MMBA, etc.

One area where there has been some confusion is the right of unions to access employer facilities. EERA and HEERA provide for such a right by statute. The Dills Act does not; but PERB has interpreted the Dills Act to include an “implied” right of access. The MMBA also fails to include statutory language granting access rights but does provide that such rights can be subject to local rule. The question then arises - if a local entity does not have a local rule on a union's right to access employer facilities, does the MMBA grant an implied right of access? The Board intentionally avoided this question in Fresno Irrigation District (PERB Dec. No. 1565M) (that decision was subsequently overturned by the court of appeal).

The question arose again in this matter. Here, the issue was whether the employer violated the MMBA by denying union access to its facilities. In the proposed decision, the ALJ held that, “the MMBA inferentially includes a right of access for employee representatives . . .” Thus, the ALJ answered in the affirmative the question that was explicitly deferred by the Board in Fresno Irrigation District.

The Board then rejected the ALJ’s proposed decision. Without stating whether it agreed, the Board noted the employer’s argument that access rights under the MMBA must be determined by local rule. The Board also stated that the fact that access rights are subject to local rules under the MMBA “gives the City a measure of discretion in drafting its own access policy.” Unfortunately, the Board never addressed whether an implied right of access exists under the MMBA. Also unanswered is how much discretion the Board will give to an employer’s local rule on union access.

Until a more definitive answer is provided by the Board, employers under the MMBA would be wise to generally conform their local rules on access to the scope of the right under EERA, HEERA and the Dills Act. Any attempt by a local entity to enact local rules that are more restrictive should be narrowly tailored and supported by business necessity. Because this area of law is in flux, it would be wise for local entities to consult with counsel before making changes.

Monday, April 23, 2007

Board Still Considering Regs on Revocation of Proof of Support

On April 12, 2007, the Board heard public comments on the proposed regulations concerning proof of support and revocation of proof of support. Union supporters turned out in force and were unanimously opposed to the regulations. Most speakers objected to even the concept of allowing an employee to change his or her mind and revoke proof of support. So employees beware - signing that union authorization card is a lot like joining a fitness club - once you join, you're stuck with it until you die.

After the close of the public comment period, the Board took the matter under submission to consider the comments. The Board has one year from the publication of the notice to take action, so the Board possible could adopt the regulations at its next meeting. If the Board decides to make substantial modifications, it must issue a new notice and provide another opportunity for written comments.

AB 220: FFBOR Tabled

AB 220 would enact the Fire Fighters Bill of Rights, similar to the existing Peace Officers Bill or Rights.

AB 220 was placed on suspense on April 18, 2007.

AB 553 - SEIU Attempts a Power Play

AB 553 would dramatically expand PERB’s jurisdiction under the MMBA to cover all public employee strikes, even those that do not otherwise constitute an unfair practice. Currently, there are categories of strikes that fall outside of PERB’s jurisdiction. For example, the MMBA itself divests PERB of jurisdiction over strikes involving local agency peace officers or employees of the City or County of Los Angeles, even if the strike would otherwise be an unfair practice. PERB also lacks jurisdiction over strikes that do not constitute unfair practices but are illegal under other California laws, such as the Labor Code § 1962 prohibition of strikes by firefighters. Most importantly, California common law prohibits a public employee strike when the strike “creates a substantial and imminent threat to the health or safety of the public.”

If enacted, AB 553 would arguably give jurisdiction over requests to enjoin strikes that threaten public health and safety. This is a concern for local agencies throughout California because local courts are often in the best position to quickly determine whether a strike threatens public health and safety. Additionally, it is unclear whether PERB could actually seek to enjoin a strike that threatens public health and safety as PERB has never held such strikes to be unfair practices and PERB has no jurisdiction to enforce California common law. It is also unclear whether PERB’s decision not to seek an injunction would bar a local agency from subsequently applying directly to a court to enjoin a strike that threatens public health and safety.

The language of AB 553 is also broad enough that public employee strikes against the City or County of Los Angeles would likely fall under PERB’s jurisdiction. However, since PERB has no jurisdiction to determine unfair practices involving the City or County of Los Angeles, it is unclear how a strike against these public agencies could ever be enjoined by PERB. In addition, AB 553 would also apply to peace officer strikes, even though most peace officers are not otherwise under PERB’s jurisdiction.

A hearing on AB 553 has been set for May 2, 2007.

Tuesday, April 3, 2007

More On What Constitute a "Reasonable" Local Rule

Further thoughts on City and County of San Francisco (PERB Dec. No. 1890M):

The Board held that when the reasonableness of a local rule is at issue, the burden to demonstrate that the rule is "unreasonable" falls on the party attacking the rule. On this point, the Board held that:

"Where a legislative action by a local governmental agency is attacked as unreasonable, the burden of proof is on the attacking party. Such regulations are presumed to be reasonable in the absence of proof to the contrary."

How strong that presumption is remains to be seen. As mentioned below, there are many situations where local rules differ from the "default" local rules provided by PERB regulations. For example, PERB regulations generally provide a 3-year contract bar. Many local agencies impose contract bars greater than 3 years. Presumably, PERB could not hold that any local rule providing a contract bar greater than 3 years is unreasonable. However, how much deference will PERB provide? Hopefully, this decision indicates that PERB will provide great deference to local agencies.

Monday, April 2, 2007

PERB Recognizes "De Minimus" Standard

Newark Unified School District (PERB Dec. No. 1895E) (Issued 03/27/07)

The case involved 3 consolidated unfair practice charges. All the charges stemmed from contract negotiations between the parties. The decision discusses various allegations of bad faith bargaining and unilateral change.

Of interest is the finding regarding the employer’s unilateral implementation of a pre-paid legal services program for its employees. Although finding that the employer did make a unilateral change within the scope of representation, the Board agreed with the ALJ that the change was “de minimus” because there was no “generalized effect.” This was because the district promptly froze enrollment in the program as soon as the current charge was filed.

A couple of past PERB decisions have characterized certain changes as “de minimus.” However, those cases all involved situations where the employer promptly and completely rescinded the alleged unilateral changes. Since those cases involved conduct that was corrected, it may be a more appropriate to characterize them as “safe harbor” rather than “de minimus” situations.

Unlike those cases, here the employer allowed a few (5 to 6) employees to remain in the pre-paid legal program. Because the employer did not entirely completely rescind its actions, this is much more of a true “de minimus” situation than the previous PERB cases. In addition, the recent Claremont case from the California Supreme Court arguably is the first judicial case in California recognizing a “de minimus” standard under any of the public sector statutes. With Claremont and this Newark decision, employers hopefully will have more opportunity to argue that minor changes affecting few employees should not be considered unfair practices.

No Unilateral Change

County of Siskiyou (PERB Dec. No. 1894M) (Issued 3/27/07)

The issue in this case was whether the contract required that “extra help” employees be laid off prior to any permanent employees. The Board reached the same conclusion as the ALJ - to dismiss the complaint - but reached its decision based on a different rationale. The ALJ apparently had held that the contract language was ambiguous, and thus, found that the union had failed to meet its burden of proof to establish a ‘change.’

The Board in its analysis attempted to harmonize the contract language with the County Code and the County’s personnel policies. Based on its analysis, the Board found no requirement that “extra help” be laid off first, and thus, held that there was no unilateral change by the employer.

DFR Charge Dismissed

SEIU Local 790 (Chan) (PERB Dec. No. 1892M) (Issued 3/15/07)

Employee alleged that union violated its duty of fair representation by failing to seek arbitration of employee’s termination. Applying well-settled law, Board dismissed the charge for failure to state a prima facie case.

What is a Reasonable Local Rule?

City and County of San Francisco (PERB Dec. No. 1890M) (Issued 3/12/07)

This is one of the first cases addressing whether a local rule is “reasonable” under the MMBA. The Board discussed the “reasonableness” standard in broad terms; finding that a local agency has discretion in adopting local rules as long as they do not “frustrate the declared policies and purposes of the MMBA.” In this case, the Board held that the impasse procedure set forth in the City Charter was not unreasonable on its face.

This case is helpful in setting forth the general legal standards for determining whether a local rule is reasonable. However, this case did not appear to be that difficult for the Board. As more of these cases reach the Board’s docket, look for more difficult issues to arise.

Wednesday, March 21, 2007

No Duty To Provide Information Absent Request

City of Los Altos (PERB Dec. No. 1891M) (Issued 3/14/07)

Union alleged that City had an affirmative obligation to notice the union whenever the City terminated a bargaining unit member, even where the employee had not requested union representation and where the union had not specifically requested the information. The Board held that under well-established precedent, there is no obligation to provide the union information absent a request. Since there was no request, the Board dismissed the charge.

The board also stated that even if the union had requested information about an employee termination, absent consent by the employee, compliance with such a request would have to take into consideration the employee’s privacy rights. This seems like a straight forward and common sense decision.

Wednesday, March 7, 2007

DFR Dismissal Adopted

California Faculty Association (Wunder) (PERB Dec. No. 1889H) (Issued 3/1/07)

Employee alleged that the union violated its duty of fair representation by failing to take her grievance to arbitration. This is one of the rarer instances where a complaint actually issues on a DFR charge. In the proposed decision, the ALJ applied well-settled standards and found that the union’s decision not to advance the grievance to arbitration was honest and reasonable.

Wednesday, February 28, 2007

Unit Determination Decision Vacated by Request

East Whittier City Elementary School District (PERB Dec. No. 1887E) (Issued 2/27/07)

District initially filed exceptions to board agent’s unit determination decision. Subsequently, based on a vote of the affected units, the union withdrew its representation petition. Parties then settled and requested that the Board vacate its decision, which the Board agreed to do.

DFR Charge Dismissed

United Teachers of Los Angeles (PERB Dec. No. 1888E) (Issued 2/27/07)

Employee alleged that union violated its duty of fair representation. Applying established law, board agent dismissed complaint. Board summarily affirmed.

Monday, February 26, 2007

Special Appeal Denied

State of California (Department of Personnel Administration (PERB Dec. No. A359S) (Issued 2/22/07)

Board summarily denied employer’s request for special permission to appeal ALJ’s refusal to disqualify himself from case.

Wednesday, February 21, 2007

No Past Practice Found

Trustees of the California State University (PERB Dec. No. 1886H) (Issued 02/20/07)

Union alleged that employer unilaterally repudiated a policy of granting release time to employees for the purpose of attending PERB proceedings. Board adopted ALJ decision which found that union “failed to demonstrate by a preponderance of the evidence that the University had a binding past practice of granting released time for PERB informal conferences not contemplated within the MOU.” Charge and complaint dismissed.

Analysis: Standard application of well-settled law on unilateral changes to the specific facts in this case.

Reconsideration Granted

King City Joint Union High School District (PERB Dec. No. 1777Ea) (Issued 2/16/07)

Another interesting situation. In King City Joint Union High School District (PERB Decision No. 1777), the Board held that the district improperly calculated a negotiated salary formula and ordered make-whole relief. During the enforcement stage, the parties discovered that make-whole relief would cost the district $5.2 million out of a $17-$18 million dollar budget. According to the parties, the effect of forcing the district to pay the $5.2 million at once would mean bankruptcy for the district - an option that neither party wanted.

Based on the dire financial consequences of the ordered relief, the parties jointly submitted a request for reconsideration of the Board’s decision. The parties requested that the Board modify its order as to the amount to be paid employees and to allow installment payments. Finding that the financial consequences of the Board’s order constituted ‘new evidence,’ the Board granted the motion for reconsideration under regulation 32410(a).

Analysis: The Board has generally strictly interpreted regulation 32410(a) which governs requests for reconsideration. Interpreting that regulation strictly, it is not at all clear how the high cost of complying with the Board’s order constitutes “new evidence” within the meaning of 32410(a). Presumably, someone could have done the math before the PERB hearing as well as after. The decision is best explained by the fact that the Board wanted to help the parties given that this was a joint request and the consequences of not acting would be severe. But query, what if all the facts were the same except that it was not a joint request, but a request solely by the district . . . would the decision have been the same?

Friday, February 16, 2007

PERB Stays Out of Internal Union Matters

Kern High Faculty Association CTA/NEA (Maaskant) (PERB Dec. No. 1885-E) (Issued February 14, 2007)

Employee brought unfair practice charge against union for declaring him ineligible to serve on union’s Representative Council because he was an agency fee payer. Board precedent provides that "matters concerning internal union affairs are generally immune from review, unless they have a substantial impact on the relationships of unit members to their employers so as to give rise to a duty of fair representation, or involve retaliations for protected activity.” Applying this doctrine to the facts, the Board affirmed the dismissal of the charge.

Reconsideration Denied

Burlingame Elementary School District (PERB Dec. No. J024-E) (Issued February 14, 2007)

District sought reconsideration and/or judicial review of a PERB decision finding that an employee did not occupy a “confidential position” within the meaning of EERA. Applying established law to the facts, the Board denied both requests.

"Technical Refusal to Bargain" Not an Avenue to Review of PERB Decision

Los Angeles Unified School District (PERB Dec. No. 1884-E) (Issued January 30, 2007)

In this case, a school district refused to bargain over the terms and conditions of employment of several employee classifications in its supervisory unit, which PERB had two years earlier found to be non-management. Los Angeles Unified School District (PERB Dec. No. 1664. The District’s only defense was that PERB’s prior decision was wrong, and that the disputed classifications were in fact managerial. The District characterized its action as a “technical refusal to bargain.”

Under NLRA, there is generally no direct judicial review from the Board’s decision as to unit appropriateness. Because no direct judicial review is available, employers under the NLRA have often engaged in a “technical refusal to bargain” in order to draw an unfair labor practice charge. Once a charge is filed and a complaint is issued, the employer can then raise as a defense to the unfair labor practice any objections to the unit, and eventually obtain judicial review. This is the defense the district attempted to raise here.

PERB rejected the District’s attempt to obtain review of its prior decision. PERB held that under EERA, the only way to obtain review was through a unit modification petition, an action that was already adjudicated in the prior decision.

Implicit in PERB’s holding is the idea that a party dissatisfied with a Board decision involving unit appropriateness should seek direct judicial review, which is available for Board’s decisions. It is not clear here whether the District sought judicial review of PERB’s earlier decision. In any event, this decision makes clear that PERB will not allow a collateral attack on a prior decision through the use of a “technical refusal to bargain.” Here, however, the District suffered little harm in its attempt to challenge the prior decision since the only remedy imposed on it was to begin bargaining with the union over the disputed classifications, something it would have had to do anyway.

Monday, February 12, 2007

Buyer's Remorse: "Contract Rescission"

San Diego Unified School District (PERB Dec. No. 1883-E) (Issued January 27, 2007)

Ever agree to something you wish you hadn't? In this case PERB addressed the concept of "contract rescission" in collective bargaining. Here, the employer agreed to a contract provision that resulted in far higher cost than the employer anticipated. The employer argued that it would be unconscionable to enforce the contract provision due to its cost. PERB held that a party seeking to rescind a contract must establish the following elements:
1) The party made a material mistake regarding a basic assumption of the contract;
2) The party seeking the rescission did not neglect a legal duty or otherwise fail to exercise ordinary diligence; and
3) The mistake was so significant that enforcement of the contract would be unconscionable.

Applying this test to the facts, PERB found that the employer established the first element, but failed in establishing the second. Namely, the employer failed to research the actual cost of the provision and relied solely on its own assumptions. In reaching its holding, PERB held:
"Clearly, the lack of preparation leads to needless mistakes. If we permitted rescission based on alleged lack of preparation, we would both open the door to contract challenges based on careless bargaining and undermine the need for adequate preparation."

Unaddressed in this decision is the issue of severability. Specifically, if a party meets the above requirements on a particular contract provision, is the entire contract rescinded or just that provision?

This leads to another interesting question. Unlike the construction industry where much of the contract rescission doctrine originates, collective bargaining by its nature involves various quid pro quos. As often happens, one party gives ground on a subject in exchange for gains elsewhere in the contact. What happens when one party tries to rescind a provision but has already gained the benefit of another? Would there be some estoppel or other equitable-type remedy for the party against whom rescission is being sought? Interesting questions, but in reality, the elements required for contract rescission are fairly strict so most employers probably will never face these questions.