Tuesday, December 30, 2008

When a Change Is Not a Unilateral Change

Service Employees International Union, Local 1000, CSEA (2008) PERB Decision No. 1997-S (Issued on 12/22/08)

In July 2005, certified nurse assistants at the Chula Vista Veterans Home engaged in a “sick-out.” The Memorandum of Understanding (MOU) between the State of California (State) and the Service Employees International Union (SEIU)—which represented the nurse assistants—contained a no-strike clause. Soon after the sick-out, the State filed an unfair practice charge alleging that SEIU committed an unlawful unilateral change by condoning the sick-out in violation of the MOU.

The key issue at hearing was whether there actually was a concerted “sick-out,” and if so, whether SEIU organized and/or condoned it. Applying NLRB precedent, the Board affirmed the Administrative Law Judge’s finding that SEIU arguably “condoned” the sick-out by failing to take affirmative steps to end it. The Board expressly found that SEIU’s act of merely informing employees that a sick-out violated the MOU was insufficient. The Board also noted that, “SEIU took no subsequent actions to publicly disavow or censure the actions of the [nurse assistants] who participated in the sick-out.” The Board held, however, that the mere violation of the MOU is not always an unlawful unilateral change. In order for there to be an unlawful unilateral change, the change must have a “generalized impact or continuing effect” on the terms and conditions of employment.

In considering whether SEIU’s breach of the MOU had a generalized effect, the Board cited several cases where one-time breaches of a contract were found not to constitute an unlawful unilateral change. The Board noted that under existing precedent, “a breach of contract amounts to a unilateral change where the party in breach asserts that the contract authorizes its conduct” or where the breach represents a “change in policy that is generally applicable to future situations.”

Applying those standards, the Board found that the State had not established that SEIU’s actions had a generalized effect. Specifically, the Board found that there was no evidence that SEIU asserted that the sick-out was legally permissible and no evidence that SEIU intended to breach the MOU in the future. Accordingly, the Board dismissed the unfair practice charge.


The majority opinion drew a rare dissent. The dissent argued that there was indeed a generalized effect resulting from SEIU’s actions. Namely, the sick-out negatively affected the remaining nurse assistants and patients at the hospital. The dissent also found nothing in the record to suggest that SEIU would refrain from repeating its actions (or inaction) in the future. Given these facts, the dissent would have found that SEIU committed an unfair practice by condoning the sick-out in violation of the MOU.


I have several comments on this decision.

1. I like the fact that both the majority and dissenting opinion focused on whether the violation of the MOU had a “generalized effect” on the terms and conditions of employment. I had argued in my post on County of Sacramento (PERB Dec. No. 1943-M) (County of Sacramento) that the Board failed to properly consider this critical factor in finding that the employer in that case committed an unfair practice. Indeed, I think this decision highlights why I feel the Board reached the wrong result in County of Sacramento.

Recall that in County of Sacramento, the employer actually rescinded the unilateral change before it was scheduled to take effect. Even though the County rescinded the change—thereby restoring the statue quo ante—the Board held that those actions alone did not cure the unlawful unilateral change because it did not correct the “destabilizing and disorienting impact on employer-employee affairs.” Compare that with this decision. Here, SEIU did not cure its violation or take any action to rescind its actions. Thus, SEIU’s conduct here arguably had more of a destabilizing effect on employer-employee relations than the actions of the employer in County of Sacramento. Yet the Board found no generalized effect in this case. In my opinion, these two decisions are inconsistent.

2. Although I think the Board reached the wrong result in County of Sacramento, I also think the majority ended up with the wrong result in this case. Some may argue that I am being inconsistent myself. Perhaps I am, but here is how I look at it. As I argued in my post on County of Sacramento, I believe that PERB precedent supports the concept of a safe harbor in unilateral change situations. Specifically, a party that has committed a unilateral change should be allowed some opportunity to avoid liability for an unfair practice by rescinding its action and restoring the status quo ante. In my opinion that’s what the employer did in County of Sacramento and what SEIU failed to do here. Had SEIU taken some action to censure its employees or somehow disavow the sick-out, I would agree with the majority that there is no generalized effect. This is because where the party taking the unilateral change has rescinded its action and taken steps to make whole the aggrieved party, the “destabilizing effect” of the original unilateral change is eliminated, or at least greatly mitigated. Here, SEIU took no action to correct its behavior and to make whole the employer. Accordingly, I believe the Board should have found an unfair practice.

3. Although I think the Board reached the wrong result, this decision is actually good for employers. The reality is that the vast majority of unilateral change charges are filed against employers, not against unions. Using the analysis in this case, employers can argue that a one-time contract breach has no generalized effect without some showing that the employer intends to breach the contract again in the future. Since that’s a difficult burden to meet, this case arguably makes it harder for unions to establish unilateral change cases. This assumes, of course, that PERB strictly follows the holding in this case in the future (see last point, below).

4. As mentioned above, unions are seldom accused of unlawful unilateral changes. This is because unions normally do not have the power to effectuate a unilateral change in the terms and conditions of employment. Indeed, one of the first (if not the first) case finding that a union committed an unlawful unilateral change was only issued four years ago. (State of California (Department of personnel Administration) (2004) PERB Decision No. 1601-S.) Since that time, everyone has assumed that the elements for a unilateral change are the same whether the charge is against an employer or union.

If I were a union advocate, however, I would argue that the standards shouldn’t be the same. I would argue that since unions have a very limited ability to unilaterally change the terms and conditions of employment, a unilateral change by a union has less of a destabilizing effect on future employer-employee relations than one by an employer. (Naturally, there are many arguments to the contrary; but I’m pretending to be a union advocate here…) I wouldn’t be surprised at all if in the future unions made this argument in order to distinguish this case.