Friday, September 26, 2008

"Anti-huddling" Policy Not Within Scope

Association for Los Angeles Deputy Sheriffs v. County of Los Angeles (2008) __ Cal.App.4th ___ (Court of Appeal Case No. B197611) (Issued 9/24/08)

In 2006, the Los Angeles County Sheriff’s Department revised its policy on deputy-involved shootings to prohibit officers involved in a shooting incident from talking with each other prior to being interviewed by the Department’s investigators. Officers still had the right to individually talk with an attorney or labor representative. The intent of the new policy was to ensure one officer’s recollection would not be influenced by another’s. The parties referred to this rule as an “anti-huddling” policy.

One of the issues before the court was whether the anti-huddling policy was within the scope of representation under the MMBA such that the County was required to bargain with the Association. Because this case involved Los Angeles County and cops, PERB did not have jurisdiction over the dispute. Thus, the case found its way to the Court of Appeal via the trial court.

In finding that the County’s policy was not within the scope of representation, the Court applied the 3-part test set forth in Claremont Police Officers Assn. v. City of Claremont (2006) 39 Cal.4th 623. First, the court found that the anti-huddling policy did not have a significant effect on officers’ “wages, hours, and working conditions.” Second, the court found that the policy arose from the implementation of a fundamental managerial decision. Each of these findings was sufficient to find that the policy was outside the scope of bargaining. However, for good measure, the court also applied the balancing test and found that it weighed in favor of the County.

With respect MMBA, the court’s holding does not break any new legal ground. The court’s application of the Claremont test is interesting, but not surprising as this case bears similarity to the Claremont case itself. In Claremont, the City implemented a tracking program to combat racial profiling. In both this case and Claremont, the courts appear to give management great deference in imposing policies that go directly to the public mission—to combat racial profiling in Claremont and to maintain public trust in this case.

Interesting Note: The Association also asserted that the anti-huddling policy violated the officers’ Weingarten rights. The court held: “We rejected [the Association’s] argument that Weingarten supports the principle that a deputy has a communal right to huddle with other deputies and counsel.”

Thursday, September 25, 2008

Constitutionality of Binding Interest Arbitration

In 2000, Governor Davis signed SB 402 which created a mandatory system of binding interest arbitration for local police officers and firefighters. Not surprisingly, local governments considered SB 402 a direct attack on the “home rule” doctrine enshrined in the California constitution. Under the home rule doctrine, local governments have plenary authority to set the compensation of county employees. SB 402 altered this doctrine by vesting in a private arbitrator the authority to issue a binding decision setting employee compensation.

SB 402 quickly found its way to the California Supreme Court. In County of Riverside v. Superior Court (2003) 30 Cal.4th 278 ("Riverside"), the California Supreme Court had little trouble finding SB 402 unconstitutional. However, that wasn’t the end of it. In one of his last acts in office, Governor Davis signed SB 440. Like SB 402, SB 440 created a mandatory system of interest arbitration for local police and firefighters. However, in an attempt to cure the constitutional defects in SB 402, SB 440 provides that the arbitrator’s decision can be rejected by the governing body if it unanimously rejects the decision within five days. (Code Civ. Proc., §1299.7.)

In the eyes of local government, SB 440 is nothing more than SB 402 in disguise. The requirement that the local entity unanimously reject the decision within five days is so onerous that it effectively renders the arbitration decision binding. Initially, every superior court that considered SB 440 found it unconstitutional for the same reasons Riverside found SB 402 unconstitutional. (See, e.g., Sierra Madre Police Officers Association v. City of Sierra Madre (Los Angeles Superior Court, Case No. GS 010036; The Adelanto Community, etc. v. City of Adelanto (San Bernardino Superior Court, Case No. VCVVS037008); County of Tulare v. Tulare County Deputy Sheriffs Association (Tulare County Superior Court, Case No. 06-219977). Notably, none of the employee associations on the losing side of these cases filed an appeal.

[Correction: A notice of appeal was filed in the Tulare case, but the case settled]

Recently, the Sonoma County Superior Court became the first trial court in California to find SB 440 constitutional. (Sonoma County Law Enforcement Association v. County of Sonoma (Sonoma County Superior Court, Case No. SCV 242225).) In its decision, the court reasoned that:

"[G]iven the strict rules of constitutional interpretation, the statutory scheme [of SB 440] is not unconstitutional as it may be followed to avoid the binding nature of the arbitrator's decision. The County may reject the arbitrator's determination, or fail to act and succumb to the binding outcome. It is not the duty of this court to determine what motives the Legislature had in enacting this set of statutes. The law may be complied with, resulting in no obligation whatsoever to abide by the arbitrator's decision. As such, this court cannot find it to be facially unconstitutional."

Within days of the trial’s court decision, the First District Court of Appeal issued a temporary stay. The Court of Appeal also ordered the parties to submit briefs on whether the County’s writ seeking to overturn the trial court decision should be granted. (First District Court of Appeal, Case No. A122450.) Those briefs have now been filed. The parties are now awaiting a decision from the Court of Appeal as to whether it will intervene by writ; which seems likely given how quickly the Court issued its stay and the unsettled nature of the statute. Thus, it appears that an appellate decision on the constitutionality of SB 440 is well on its way.

Thursday, September 11, 2008

Parties' Mutual Mistake Does Not Reopen Bargaining

Berkeley Unified School District (PERB Dec. No. 1976-E) (Issued on 9/9/08)

In 2005, the Berkeley Unified School District (District) and the Berkeley Federation of Teachers (Federation) were engaged in contract negotiations. The Federation alleged that during bargaining the District asserted that it was legally prohibited from using parcel tax revenue to fund its mandatory reserve. This had the practical effect of reducing the amount of money available to fund employee wages and benefits.

After negotiations concluded and a new contract was agreed to, the Federation discovered that the District could in fact legally use parcel tax revenue to fund its reserve. The Federation then demanded that the District reopen negotiations on a provision that the Federation said it would not have agreed to but for the District’s original representation. When the District refused to reopen negotiations, the Federation filed an unfair practice charge alleging bad faith bargaining.

The Board analyzed the bad faith bargaining charge as a refusal to bargain, a per se violation. The key issue was whether the District had an obligation to reopen negotiations on the disputed provision. The Federation argued that the disputed provision was a product of a “mutual mistake of fact” and thus subject to rescission. The Board then embarked on an analysis of both PERB and NLRB law to determine whether a mutual mistake of fact triggered a duty to bargain over the disputed contract.

The Board noted that both PERB and the NLRB recognized that a “unilateral mistake of fact” could trigger a bargaining obligation in limited circumstances. Specifically, both PERB and the NLRB recognized the legal significance of a contract provision based on mistake of fact when: (1) the mistake is a unilateral one; and (2) rescission is raised as a defense to a bad faith bargaining charge.” However, the Board emphasized that demonstrating a unilateral mistake of fact is extremely difficult. First, the unilateral mistake cannot be caused by a party’s lack of “ordinary diligence.” Second, the mistake must be so obvious that the other party should be put on notice.

The Board then went on to consider the significance of a mutual “mistake of fact.” The Board held that unlike unilateral mistakes of fact, mutual ones do not trigger a bargaining obligation. The Board noted that neither PERB nor NLRB cases recognized mutual mistakes of fact as creating a bargaining obligation. Further, citing to public policy, the Board reasoned that:

“Allowing a party to use rescission based on mutual mistake as a means to reopen the CBA would undermine the integrity and stability of the bargaining process by putting the CBA in a perpetual state of uncertainty. Moreover, such a rule would lead to careless bargaining by discouraging parties from verifying each other’s statements during negotiations in the hopes that it will lead to an opportunity to renegotiate an unfavorable contract provision in the future. Neither result is desirable.”


This is an interesting decision. At first blush, the decision seems to be a departure from PERB’s general practice of following the California statutory contract law. (Barstow Unified School Dist. (1996) PERB Dec. No. 1138-E (PERB generally follows California Civil Code in the interpreting contract language).) Under the California Civil Code, every contract requires that there be “free” and “mutual assent.” (Civ. Code, §1550, 1565.) The Civil Code further provides that consent is not free when obtained through mistake, which can be either a mistake of fact or law. (Civ. Code, §1576, 1577.) California court cases have recognized that contracts can be rescinded in situations involving both unilateral mistakes and mutual ones. Indeed, it has generally been the rule that it is easier to unilaterally rescind a contract based on a mutual mistake of fact, rather than a unilateral one.

Thus, for PERB to follow California contract law with respect to unilateral mistakes of fact but not mutual mistakes of fact initially seems strange. This is especially true since this case arguably involved a mutual mistake of law which is a recognized grounds for contract rescission provided all the criteria are met.

The key to understanding this decision—at least in the mind of this practitioner—can be found in the last paragraph of the decision, which states:

“We recognize, of course, that mutual mistakes of fact will occur in the bargaining process. But the proper place to resolve such mistakes is at the bargaining table. Further, when a party is unwilling to voluntarily surrender a windfall it has received as the result of a mutual mistake, the other party may bring an action in court to rescind the contract. The Board's holding thus places the duty for correcting a mutual mistake of fact in the hands of the parties, where it appropriately belongs, and as a last resort in the courts, with their expertise in matters of contract law.”

This paragraph seems to be a recognition that PERB’s role in bargaining is limited to ensuring the fairness of the process, as opposed to the fairness of the outcome. In short, we (employers and unions) need to take responsibility for our actions and not expect PERB to save us from our mistakes. When mistakes do occur, the proper forum to seek rescission is in the courts who are better equipped to handle such actions. This approach by the Board seems reasonable and fair.

Quite frankly, for consistency sake the Board may want to consider taking this approach with unilateral mistakes as well. After all, the policy arguments advanced by the Board for not recognizing mutual mistakes as triggering a bargaining obligation can apply equally to unilateral mistakes. If a unilateral mistake warrants rescission, why not make the party seeking rescission go to court, just as a party seeking rescission based on a mutual mistake must do. Further, PERB’s continued recognition of unilateral mistakes as potentially reopening bargaining may serve as a loophole to this decision. For example, if this exact case occurs again, what would prevent the Federation from arguing that this was a unilateral mistake, as opposed to a mutual one? It will be interesting to see how this case plays out in the future.