Sunday, May 16, 2010

PERB: It's Interference To Offer Better Benefits to Non-Union Members

State of California (Department of Personnel Administration) (2010) PERB Decision No. 2106-S (Issued on 4/30/10)


The contract between the State of California (State) and the California Correctional Peace Officer Association (CCPOA) provided that dental and vision benefits would be provided to bargaining unit members through the CCPOA Benefit Trust Fund, an independent corporation established by CCPOA.  Through the CCPOA Benefit Trust Fund, an employee with two dependents would pay $41.80 per month for the dental benefit.

In October 2007, CCPOA informed the State that non-members (ie fair share fee payers) would no longer be provided dental and vision benefits through the CCPOA Benefit Trust Fund. As a result, the State informed the fair share fee payers that they would automatically be enrolled in the state-sponsored dental and vision plans. Under the state-sponsored dental plan, an employee with two dependents would pay $30.94 per month.  CCPOA then filed an unfair practice charge alleging both discrimination and interference. CCPOA asserted that the State unlawfully offered a lower cost dental benefit not provided to CCPOA members.


In its decision, the Board affirmed the dismissal of the discrimination charge based upon its finding that there was no adverse action. However, the Board reversed the dismissal of the interference charge. The Board stated:

“[T]he lower cost dental benefit was not offered to union members. Providing benefits at a lower cost to non-union members, while excluding union members from this option, tends to result in at least slight harm to employees who choose to exercise the right to join a union. A reduced benefit cost available only to non-union members may influence an employee’s decision to join the union. Accordingly, the charge states a prima facie case of interference.”
The Board noted that because the only issue was whether CCPOA stated a prima facie case, the issue of whether the State’s actions were justified due to operational necessity and/or circumstances beyond the employer’s control would be addressed at a formal hearing.

Member McKeag dissented from the majority opinion. In her dissent, she stated:

"In the instant case, CCPOA members continued to enjoy the exact same dental benefits after the implementation of the State’s last best and final offer. When CCPOA Benefit Trust Fund refused to provide dental benefits to the former CCPOA agency fee payers, the State was faced with a choice to either offer these employees the dental benefit currently offered to non-CCPOA members or to provide no dental benefit. Clearly, the latter option was untenable and would have likely resulted in litigation. Therefore, the State had only one legitimate option, benefits available to other non-Bargaining Unit 6 members simply does not constitute a harm in this instance.”

  1. My initial reaction was that CCPOA had a lot of nerve bringing this case. This whole situation was started when CCPOA kicked its fair share fee payers out of the CCPOA Benefit Trust Fund. CCPOA had a right to do this—and maybe it even had a good reason—but clearly CCPOA itself was “discriminating” against non-union members. For CCPOA to then bring a charge against the State for “discriminating” against union members is a classic case of the pot calling the kettle black.
  2. With respect to the interference charge, it’s a close call if you’re solely focused on the prima facie case. Is it interference for an employer to offer non-union members a better benefit than union members? Sure, by itself that’s a problem. However, here the State had to provide the fair share fee payers a dental plan. Could the State have also offered its plan to union members? We need more facts but that likely would just have brought a separate unfair practice charge by CCPOA.
  3. Regardless, it seems clear to me that the State is going to prevail at hearing based on its legitimate business reasons. I’m assuming that the dental-plan the State offered to the fair share fee payers was the same plan offered to other State employees. If so, there’s nothing the State can really do if it just happens that its own plan is cheaper than CCPOA’s.
  4. The dissent would have short-circuited the formal hearing by just ruling on the State’s legitimate business reasons at the charge review stage. As a management attorney, I certainly see the benefit of taking that approach. There are a lot of cases where I would like the Board agent to consider my client’s legitimate business reasons before deciding whether to issue a complaint. However, as it stands, the rule is still that a respondent’s affirmative defenses are to be considered at the formal hearing state, and not at the charge review stage.