Wednesday, February 20, 2008

No Safe Harbor for Employer Who Rescinded Unilateral Change

County of Sacramento (PERB Dec. No. 1943-M) (Issued on 2/14/08)

In January 2006, the County of Sacramento notified two of its unions that it was considering changing its Retiree Health Insurance Program (RHIP). The RHIP is a non-vested County benefit that provides a monetary allowance to retirees to offset the cost of health insurance. The County’s proposal called for limiting the number of current employees who would be eligible for the RHIP upon retirement. The unions demanded to bargain over the County’s decision to change the RHIP’s eligibility requirements. The County refused on the ground that the decision to change the RHIP was not within the scope of bargaining.

In March 2006, the County approved and implemented the proposed RHIP changes. However, in September 2006, prior to the effective date of the eligibility changes for current employees, the County rescinded the RHIP changes and agreed to begin “discussions” with the unions. The unions subsequently brought an unfair practice charge which went to a hearing before an Administrative Law Judge (ALJ). The ALJ held that the unfair practice charge was moot because the County had rescinded the RHIP changes.

On exceptions filed by the unions, the Board reversed the ALJ’s proposed decision. Citing to Amador Valley Joint Union High School District (1978) PERB Decision No. 74, the Board held:

“That the later reversal or recission [sic] of a unilateral action or subsequent negotiation on the subject of a unilateral action does not excuse a violation. . . . The fact that the County reversed its position and restored the status quo before the new policy went into effect, does not cure the unlawful unilateral change.”


There are several aspects of the Board’s decision in County of Sacramento that are problematic, especially for employers. The first involves what the Board will consider an unlawful unilateral “change.” Past Board decisions have uniformly held that to be unlawful, a unilateral change must not be merely an isolated breach of the contract or past practice, but constitute a change in policy. (Sonoma County Office of Education (1997) PERB Decision No. 1225.) In other words, the change must have “a generalized effect or continuing impact upon bargaining members’ terms and conditions of employment.” (See Walnut Valley Unified School District (1981) PERB Decision No. 160; Grant Joint Union High School District (1982) PERB Decision No. 196.)

Here, it is difficult to see what generalized effect the County’s actions had on bargaining unit members since the County rescinded the changes to the RHIP before the changes ever became effective. True, the County did not waiver from its position that the changes were outside of scope of bargaining. However, once the County rescinded the changes, it never took action on its position; in other words, there was no longer any “change.”

In finding an unlawful unilateral change despite the rescission, the Board cited to Amador Valley Joint Union High School District (1978) PERB Decision No. 74 and Marin Community College District (1980) PERB Decision No. 145 for the proposition that an unlawful unilateral change can exist even where the change is rescinded. True enough, those cases do hold that discontinuing an unfair practice does not render the prior violation moot. However, a strong argument can be made that Amador only applies where the rescission of the unilateral change does not undo the actual harm that has already occurred. Where there has been no actual harm—as the case in Sacramento County—early PERB cases have recognized a “safe harbor” type doctrine (sometimes also referred to as the “de minimus” doctrine). For example, in Muroc Unified School District (1978) PERB Decision No. 80, the Board held that a unilateral change is not unlawful where: 1) it is promptly rescinded, and 2) employees are either not harmed or made whole. (See Oakland Unified School District (1983) PERB Decision No. 367; County of Monterey (2004) PERB Decision No. 1663-M, adopting ALJ's proposed decision at p. 27.)

At first blush, the Muroc line of cases seem to conflict with Amador. However, Amador and its line of cases can be best understood as holding that even small changes are unlawful when made unilaterally. In contrast, Muroc applies in situations where a change has been promptly rectified so that it can be said that there has been no change at all.

Here, based on the facts set forth in the decision, it seems to this practitioner that the Muroc line of cases should have been applied instead of Amador. Sacramento County rescinded the proposed RHIP changes before they ever became effective and it appears no employee suffered any harm. Under these facts, it seems the County should have been allowed to utilize the “safe harbor” doctrine in Muroc.

Thursday, February 14, 2008

PERB Overrules Contracting-Out Waiver Case

Long Beach Community College District (PERB Dec. No. 1941E) (Issued on 1/30/08)

The MOU between the Long Beach Community College District (District) and its Police Officers Association contained a management rights clause which reserved to management the right to “contract out work.” Relying on this clause, the District made the decision to contract out all of its police services to the City of Long Beach without negotiating with the union. The union asserted in its unfair practice charge that the waiver was intended only to apply to contracting out for armed services during special campus events, and was not intended as a general waiver over all contracting out decisions.

In 2003, PERB’s Office of the General Counsel dismissed the union’s unfair practice charge on the ground that the MOU language constituted a waiver of the union’s right to negotiate over contracting out decisions. The union appealed the dismissal to the Board which overturned the dismissal in Long Beach Community College District (2003) PERB Dec. No. 1568E (Long Beach I). In Long Beach I, the Board found that the phrase “contract out work” was ambiguous because some contracting out decisions were negotiable or some were not, and it was not clear from the MOU language itself what rights were being waived. The Board did hold, however, that the District could assert its defense at a hearing before an Administrative Law Judge (ALJ) where presumably the District would submit extrinsic evidence on the meaning of the disputed MOU language. In reaching its decision in Long Beach I the Board expressly overruled Barstow Unified School District (1996) PERB Dec. No. 1138.

The case then went before an ALJ. The proposed decision of the ALJ found that the District failed to demonstrate that the union had waived its right to negotiate over all contracting out decisions. Accordingly, the ALJ found that the District had committed an unfair practice.

The District then filed exceptions with the Board. In its decision, Long Beach Community College District (2008) (PERB Dec. No. 1941E) (Long Beach II), the Board overruled Long Beach I finding that the MOU language “contract out work” was a clear and unambiguous waiver of the union’s right to negotiate over the District’s decision.

Noteworthy is the fact that the Board gave very little weight to the union’s extrinsic evidence that the MOU language was not a far-reaching waiver. Prior PERB decisions have suggested that extrinsic evidence may be utilized by a party to demonstrate a “clear and unmistakable” waiver. This decision may signal a distaste by the Board for resorting to extrinsic evidence to prove a waiver. Such a move makes sense since logically, contract language cannot be “clear and unmistakable” if one has to resort to extrinsic evidence to ascertain its meaning.

Other Notes

Interestingly, this is not the first time the Board has overturned a prior Board’s decision in the same case, when that case came back before the Board. Two years ago, the Board in State of California (Department of Corrections) (2006) (PERB Dec. No. 1826S) overturned the prior Board’s decision in State of California (Department of Corrections) (2003) PERB Decision No. 1579-S (Corrections). As a side note, in that decision the Board ordered the prior Board’s decision to be “vacated.” In Long Beach II, the Board ordered the prior Board’s decision reversed and overruled. It is not clear whether vacating a decision is any different than overruling it; however, the effect presumably is the same.

Also interesting in Long Beach II is that the Board found that the District failed to negotiate with the union over the “effects” of its decision. To remedy that violation, the Board ordered the District to provide backpay to all the police officers who were laid off going back to August 1, 2003. Depending on how much the officers were able to mitigate their damages, the District’s backpay liability could be significant. The backpay order probably assures that neither party is fully satisfied with the Board’s decision in Long Beach II. It will be interesting to see if one or both of the parties attempt to take this case to the Court of Appeal.

Wednesday, February 13, 2008

Scope of Representation is Limited under the Trial Court Act

Fresno County Superior Court (PERB Dec. No. 1942C) (Issued on 01/31/08)

This is one of the first cases under the Trial Court Act to go before an administrative law judge and the Board. The issue was whether the Fresno Superior Court’s decision to require all court reporters to provide “realtime” court reporting services was within the “scope of representation.” Relying on the unique language of the TCA, the Board held that it was not.

The TCA, similar to all the other acts administered by PERB, provides that the “scope of representation shall include all matters relating to employment conditions and employer-employee relations, including, but not limited to, wages, hours, and other terms and conditions of employment.” (Gov. Code 716349(a).) However, the TCA goes further and provides that:

“In view of the unique and special responsibilities of the trial courts in the administration of justice, decisions regarding the following matters shall not be included within the scope of representation:
(1) The merits and administration of the trial court system.
(2) Coordination, consolidation, and merger of trial courts and
support staff.
(3) Automation, including, but not limited to, fax filing,
electronic recording, and implementation of information systems.
(4) Design, construction, and location of court facilities.
(5) Delivery of court services.
(6) Hours of operation of the trial courts and trial court system.”

PERB found that the provision of “realtime” reporting by court reporters constituted a “delivery of court services” under the TCA.

Although PERB held that the Court’s decision to require court reporters to provide “realtime” court reporting services was not negotiable, the impact of that decision was negotiable. However, relying on City of Richmond (2004) PERB Decision No. 1720-M (Richmond), the Board held that the union failed to adequately request to bargain over any impact, and thus, had waived their rights.