Court: Cross-Unit Bumping Is Negotiable; No Pre-Layoff Hearing Required for Economic Layoffs

Alameda County Management Employees Ass’n. v. Superior Court (Case No. A128697) (Issued on 3/7/11)

In response to a budget deficit for the 2009-2010 fiscal year, the Superior Court of Alameda County (Court) laid off 28 members in the bargaining unit represented by the Alameda County Management Employees Association (ACMEA). Under the Court’s personnel rules, an employee who is laid off has the right to “bump” into a position he or she previously held.  However, the Court negotiated a MOU with SEIU providing that an employee loses any “seniority” for calculating bumping rights if the employee leaves his or her position for more than six months. The SEIU MOU had the effect of preventing management employees from “bumping” into the SEIU unit because the management employees lost seniority per the SEIU MOU provision.

ACMEA argued that the Court could not apply the SEIU MOU to its members. ACMEA also argued that the laid off employees were entitled to pre-layoff hearings. The trial court rejected both arguments. The court of appeal reversed the trial court on the issue of whether the Court violated the Trial Court Employment Protection and Governance Act (TCEPGA) by applying the SEIU MOU to ACMEA unit members, but affirmed the trial court holding that no pre-layoff hearings were required.

With respect to the SEIU MOU, the court held that under the TCEPGA the Court had the duty to meet and confer with ACMEA over terms and conditions of employment, which include seniority rights.  The “status quo” with respect to seniority rights was contained in the Court’s personnel rules.  The appellate court held that if the Court wanted to apply the SEIU provision to ACMEA, it should have provided ACMEA notice and an opportunity to bargain over the seniority language. Because it didn’t, the court violated the TCEPGA.

As for the right to pre-layoff hearings, the court cited to Duncan v. Department of Personnel Administration (2000) 77 Cal.App.4th 1166 ("Duncan") for the holding that pre-layoff hearings are not required when the layoff is due to budgetary constraints. Here, the court held that there is no dispute that the layoffs were due to budgetary constraints. The court also noted that the layoffs involved multiple people and were done according to seniority which is an objective criteria. These factors greatly lessened any chance that the layoffs were “targeted” at particular individuals. Under these facts, the court held that pre-layoff due process hearings are not necessary.

Comments:

1. Cross-unit bumping is becoming more of an issue now that layoffs are a reality in the public sector.  Many unions take the position that members of other unions should not be able to "bump" into their bargaining unit.  However, it's fairly rare to find actual contract language prohibiting employees from "bumping" into a unit.  Most public entities allow cross-unit bumping if the employee previously held the position he or she is bumping into.  In this case, the SEIU language had the practical effect of protecting existing SEIU unit members from being bumped by employees coming back into the unit.  Under this decision, such contract language must be negotiated with not only the union demanding it, but every other union which might be affected.  I think trying to implement this decision and actually negotiate such language with multiple unions would be a nightmare.  The practical result of this decision is that employers are going to refuse to agree to the SEIU language found in this case.
2. The more interesting aspect of this case is the issue of pre-layoff due process hearings.  This is the first published decision discussing pre-layoff due process hearings since the Levine v. City of Alameda (9th Cir. 2008) 525 F. 3d 903, decision in 2008.  That decision created a stir because it suggested that pre-layoff due process hearings are required.  However, this decision makes clear that if there is no evidence that employees are being specifically "targeted" for layoff in lieu of discipline or as a form of reprisal, then no pre-layoff due process hearing is required.  What's interesting is that the court does not directly discuss Levine in reaching this holding.  However, the court cites to Levine in other portions of the case and also cites to other federal cases on the issue of due process rights.  So although I would have liked a more robust discussion of Levine versus Duncan, I think this decision gives public entities some much needed guidance as to when pre-layoff hearings are required. 

Isolated Reference to Union Activity During Termination Not Enough To Establish Retaliation

Fallbrook Union Elementary School District (2011) 2171-E (Issued on 3/01/11)

This case involved an allegation that the Fallbrook Union Elementary School District (District) decided not to reemploy a teacher because of her activities as a union site representative.  For a retaliation case, the facts are fairly short and simple. The teacher was employed on a series of temporary contracts in 2005-06, 2006-07, and 2007-08. She received satisfactory evaluations the first two years. However, in 2007-08 she was not recommended for re-hire purportedly because of her classroom management skills. The teacher alleged that immediately after she was informed by the Principal that she would not be re-hired the next year, he stated, “On a side bar, off the record, I believe that your Union activities have gotten in the way of your teaching objectives this year. . ."  Based on this statement, the union alleged that the teacher was retaliated against for her union activities as a site representative.

The Administrative Law Judge (ALJ) found in favor of the teacher. However, on exceptions by the District the Board rejected the ALJ’s proposed decision and dismissed the charge. The Board’s decision focused on whether the union had established the required “nexus” between the adverse action and the protected activity.  According to the Board, there were two factors proffered to establish nexus.  First, the union argued that the Principal failed to follow the contract by having a conference with the teacher within a certain time period after the classroom observation.  Second, the union argued that the Principal’s statement, “I believe that your Union activities have gotten in the way of your teaching objectives this year …” evidenced discriminatory intent.

The Board rejected both of these factors as supporting the required nexus. As for the failure to follow the contract, the Board found that the Principal had failed to follow the contract in prior years when he gave the teacher a favorable rating. Based on this fact, the Board set forth a rule that, “[W]hen an employer fails to comply with an MOU provision both before the employee engaged in protected conduct and after the employee engaged in such conduct, the later failure to comply with the MOU is not a reliable predictor of discriminatory intent.” As for the alleged statement by the Principal, the Board held that, by itself, it was a “relatively benign statement that does not convey union animosity.”  The Board acknowledged that it could indicate anti-union animus if coupled with other facts. But here, the Board found no other facts supporting anti-union animus.  Accordingly, the Board rejected the ALJ’s proposed decision and dismissed the complaint.

Member Wesley dissented. Member Wesley stated that the District’s failure to adhere to the contract meant that the teacher was not apprised of her performance prior to the decision not to re-hire.  According to Member Wesley, the teacher “had no way of knowing she was at risk of not being reemployed and she was not given the opportunity to improve as required in the evaluation procedure.” As for the statement by the Principal, Member Wesley agreed that it was not “blatant anti-union animosity ...” However, she would have found that the statement, “does imply that union activity is inconsistent with professional achievement and further supports the inference that the District’s actions were unlawfully motivated.” Accordingly, Member Wesley would have found that the District unlawfully retaliated against the teacher for her protected activity.

Comments:

1. Historically, it’s rare for the Board to overturn an ALJ’s proposed decision in a retaliation case because such cases are very fact-intensive and often rely on credibility determinations that the Board is loath to reject.  It’s also fairly rare for a decision to draw a dissent, so this case is doubly interesting.
2. It terms of new law, the Board held that, “[W]hen an employer fails to comply with an MOU provision both before the employee engaged in protected conduct and after the employee engaged in such conduct, the later failure to comply with the MOU is not a reliable predictor of discriminatory intent.” I think this makes sense. A classic example is the annual performance evaluation. Many public entities have an express requirement that an employee is supposed to get an annual performance evaluation. But it’s very common for supervisors to fail to comply with this requirement.  In a situation where a supervisor fails to comply with this requirement for all employees, can it really be said that the failure is evidence of any discriminatory intent?  Clearly, it’s not a good personnel practice and if the issue was “just cause” it would absolutely make a difference. But in a retaliation case under PERB, the issue is not “just cause” but whether the action was taken for discriminatory intent. The key to proving discrimination is showing that the employee was treated differently. If the employer’s non-compliance with the contract applies to everyone, then it cannot be said that any particular employee was treated differently. So I think the Board’s rule makes sense. However, I will add that failure to comply with rules and procedures can absolutely be evidence of discriminatory intent in other circumstances. So I think the application of this rule will be very fact specific.
3. The most interesting part of this decision is the Board’s treatment of the Principal’s statement, “I believe that your Union activities have gotten in the way of your teaching objectives this year …” The Board found that by itself, this statement wasn’t enough to establish retaliation.  Presumably, this is because the Board felt that the Principal could merely have been saying that the teacher did not focus enough on her core reaching duties. Fortunately for the school district, there was no other evidence of unlawful retaliation. If there was other evidence, I believe the result would have been very different. The reality is that it’s very dangerous for a supervisor to reference an employee’s union conduct during a performance review. An employee can easily view such references as a form of retaliation. If an employee is inappropriately spending time on union duties there is a legitimate way to address that.  But it must be done carefully to avoid charges of retaliation like the one in this case.

Proof of Majority Support Not Always Required When Adding Employees to a Bargaining Unit

County of Riverside (2011) PERB Decision No. 2163M (Issued on 2/18/11)

This case began with a petition from SEIU to add unrepresented ‘per diem’ nurses to an existing bargaining unit. The County denied the petition because it was not accompanied by proof of majority support of the per diem nurses being added to the unit. SEIU filed an unfair practice charge asserting that it was unreasonable for the County to impose a majority support requirement on SEIU’s petition because the County’s local rules did not contain such a requirement. In defending against the unfair practice charge, the County acknowledged that its local rules were silent regarding proof of support but argued that a majority support requirement had to be implied in the rules in order to prevent unrepresented employees from being "involuntarily unionized against their will."  The Administrative Law Judge (ALJ) rejected the County’s defense. The ALJ held that the County’s position was contrary to PERB regulations which only require proof of majority support if the added employees would increase the existing bargaining unit by 10% or more.

On exceptions, the Board affirmed the ALJ’s proposed decision. The Board noted that the National Labor Relations Board (NLRB) only requires a showing a majority support when the employees to be added to an existing bargaining unit historically have been excluded from the unit, typically (but not necessarily) by agreement between the union and the employer. (Teamsters National United Parcel Service Negotiating Committee v. National Labor Relations Rd. (D.C. Cir. 1994) 17 F.3d 1518, 1522; Laconia Shoe Co. (1974) 215 NLRB 573, 576.) However, PERB does not follow the NLRB ’s approach to accretion.  Instead, PERB regulations require a showing of majority support when adding the requested employees "would increase the size of the established unit by ten percent or more." (PERB Regs. 32781(e)(1); 61450(e)(1); 81450(e)(1); 91450(e)( 1).)  If the addition would not increase unit size by ten percent or more, no showing of majority support is required.  (Regents of the University of California (2010) PERB Decision No. 2107-H.) Based on PERB’s regulation on accretion, the Board rejected the County’s argument that a showing of majority support must be implied whenever employees are added to an existing bargaining unit.

Comments:

1. The majority support requirement for adding employees into an existing bargaining unit is one of the areas where PERB’s rules differ from those under the NLRB. Under PERB’s regulations, proof of majority support is required only if the added employees increase the bargaining unit by 10% of more.  It’s a more objective standard than that under the NLRB. I personally like PERB’s rule because it provides much more certainty to both the employee organization attempting to organize the employees and to the employer attempting to apply its local rules.
2. However, this decision leaves unanswered a very significant question. What if a public entity has in its local rules a requirement for proof of majority support whenever employees are being added to an existing bargaining unit, even if the increase to the bargaining unit is less than 10%? Clearly, the Board is saying that PERB does not require proof of majority support if the bargaining unit does not increase by 10% of more.  But what if a public entity wants to impose such a requirement in those situations where the increase is less than 10%?  Does this decision make such a “requirement” unreasonable?  In other words, is PERB imposing a minimum standard of 10% such that a public entity may not impose any contrary requirement?  It's unclear from this decision.  I believe there are certainly public policy reasons why a public entity may want to require proof of majority support in situations even where a bargaining unit isn’t increased by 10%.  It seems to me such a requirement wouldn't be that onerous to employee organizations.  But again, whether PERB would find such a requirement an “unreasonable” local rule is not answered by this decision.

PERB: Poor Personnel Practices Do Not Prove Discrimination

City of Alhambra (2011) PERB Decision No. 2161-M (Issued 2/08/11)

This case involved an employee who was rejected during probation. The employee alleged that he was rejected during probation because of protected activities, in violation of the MMBA. Specifically, the employee argued that the City retaliated against him because of comments he made criticizing his supervisor during an employee meeting.

The Administrative Law Judge (ALJ) issued a proposed decision finding that the City rejected the employee during probation because of his protected activities. To establish unlawful motive, the ALJ found that the City decided to reject the employee less than eight hours after the employee’s complaints at the meeting. The ALJ also found that the decision-maker, who knew about the employee’s complaint, decided to reject the employee based on complaints from others even though no investigation was conducted. 

On exceptions filed by the City, the Board agreed that these facts could establish a prima facie case of retaliation.  However, the Board first questioned whether the employee even engaged in protected activity. The Board noted that under the MMBA, employees have the right to represent themselves individually in their employment relations with their employer. (Gov. Code, §3502.)  But individual employee complaints generally have been held to be unprotected when they are undertaken for the employee’s sole benefit or are the result of a personal grudge. (See Los Angeles Unified School District (2003) PERB Decision No. 1552.) Here, the Board found no evidence the employee’s complaints were related to group activity or intended to group action.

The Board also acknowledged that an employee’s reporting of workplace safety concerns is protected activity. However, the Board held that the employee’s references to safety concerns during the meeting involved safety to the public, not to employees. Accordingly, the Board reversed the ALJ’s finding that the employee engaged in protected activity.

Even if the employee had engaged in protected activity, the Board held that the City met its burden to demonstrate that it would have rejected the employee during probation even absent the protected activity.  In reaching its decision, the Board made several interesting findings. First, the Board found that an employer’s failure to give an "at will" employee a reason for dismissal does not indicate unlawful motive in the absence of evidence that the employer was required by policy or past practice to do so.  (Sacramento City Unified School District (2010) PERB Decision No. 2129.)

In addition, the Board found that the evidence established that the employee was rejected solely because of complaints about his attitude and work conduct. Acknowledging that the decision-maker did not investigate the complaints, the Board held that, “while this may demonstrate a poor personnel practice, it does not establish that [the decision-maker] rejected [the employee] on probation because of his complaints about being worked too hard.  Instead, the Board found that the decision-maker reasonably believed the employee’s performance would not improve.

Comments:

1. When it comes to proving discrimination, it’s very rare to have “smoking gun” evidence of discriminatory intent.  Therefore most discrimination cases involve circumstantial evidence. In this case, the Board clarified how it will treat circumstantial evidence that can be indicia of discriminatory intent.
2. First, the Board held that, “[W]e find an employer’s failure to offer justification at the time it took action is not a reliable indicator of discriminatory intent unless the employer was required by law, policy, or past practice to give a reason.”  Practically, this will not apply often in the public sector as employees entitled to civil service protection have due process rights that include the right to know the grounds for any discipline. However, exceptions exist for probationary employees, limited-term employees, and other types of temporary employees.  In those situations, this holding may be helpful to employers.
3. Board also affirmed that merely proving that the employer made a unwise or unjust decision to discipline or terminate an employee is not enough to find that there was discrimination.  This is a concept the Board has upheld before.  This case, however, provides a good illustration that an employer’s “poor personnel practice” does not establish unlawful discrimination.
4. Finally, it is worth noting that this decision continues a trend of the Board reversing cases where the ALJ’s proposed decision has found a violation. Since July 1, 2010, the Board has considered seven (7) cases, including this case, where the ALJ’s proposed decision found a violation. The Board overturned, either partially or entirely, every one of those decisions.  During that same time, the Board considered seven (7) cases where the ALJ’s proposed decision found no violation. The Board affirmed every one of those decisions.

Supreme Court: Layoffs Are Management Right

The California Supreme Court has just issued its decision in International Association of Fire Fighters, Local 188, AFL-CIO v. Public Employment Relations Board (City of Richmond) (Case No. S172377) ("Richmond").

Here's the holding:

Here, we address two issues: (1) If, after receiving an unfair labor practice charge, PERB decides not to issue a complaint, is that decision ever subject to judicial review? (2) Is a city's decision to lay off firefighters for fiscal reasons a matter that is subject to collective bargaining?

On the first question, we agree with the Court of Appeal that although PERB's refusal to issue a complaint is generally not subject to judicial review, this general rule has narrow exceptions. One of these exception applies when, as the union alleges here, PERB's refusal is based on a clearly erroneous statutory construction.

On the second question, we conclude, as did the Court of Appeal, that when a city, faced with a budget deficit, decides that some firefighters must be laid off as a cost-saving measure, the city is not required to meet and confer with the firefighters' authorized employee representative before making that initial decision. In this situation, the city's duty to bargain with the employee representative extends only to the implementation and effects of the layoff decision, including the number and identity of the employees to be laid off, and the timing of the layoffs.

As I predicted, the Court answered "yes" to the first question and "no" to the second.  I'll have more on this decision after I've had a chance to thoroughly read it.

IAFF v. City of Richmond Decision Expected on Monday

The California Supreme Court has given notice that a decision in International Association of Fire Fighters, Local 188, AFL-CIO v. Public Employment Relations Board (City of Richmond) (Case No. S172377) ("Richmond") will be issued on Monday morning.

As a recap, the Richmond case presents the following issues:

(1) Is the decision by the Public Employment Relations Board not to issue an unfair labor practices complaint under the Meyers-Milias-Brown Act (Gov. Code, § 3500 et seq.) subject to judicial review? (2) Is a decision to lay off firefighters for fiscal reasons a matter that is subject to collective bargaining under the act?

Given the questions asked by the Justices at oral argument, my prediction is that the Court will answer the first question "yes" and the second question "no."  We'll see if I'm right.

Retired Annuitants Not Automatically In Bargaining Unit

State of California (Department of Corrections & Rehabilitation) (2010) PERB Dec. No. 2154-S (Issued on 12/30/10)

This case considered whether retired annuitants (individuals who have retired from State service and are then hired back for part-time work) working as correctional officers are automatically members of State Bargaining Unit 6 (BU6), represented by the California Correctional Peace Officers Association (CCPOA).  The administrative law judge (ALJ) ruled in favor of CCPOA.  The ALJ held that retired annuitants were included in BU6 by operation of the original unit determination by PERB in 1979. That unit determination placed all state employees working as correctional officers, parole agents, and correctional counselors into BU6.

Relying upon Unit Determination for Technical, Skilled Crafts, Service and Professional Employees of the University of California (Lawrence Livermore National Laboratory Casual Employees) (1983) PERB Decision Nos. 290-H and 290a-H (Lawrence Livermore I), a Board majority rejected the ALJ’s proposed decision.  The majority held that because there are substantial differences between retired annuitants and full-time employees, any unit determination decision must analyze whether including retired annuitants in a bargaining unit is appropriate.  The Board held that:

“Lawrence Livermore I stands for the proposition that retired annuitants are not automatically placed in units containing full-time employees performing similar tasks.  Rather, retired annuitants will be placed in such units if they are included in a unit determination or modification petition and if, following a full unit hearing, the Board determines they are appropriately placed in that unit.”

Accordingly, the Board majority dismissed the unfair practice charge.

Board Member Wesley dissented from the majority’s holding that retired annuitants are not members of BU6.  Member Wesley stated that the original 1979 unit determination found "a unit of corrections employees to be appropriate."  She noted that the unit determination specifically considered which employees to exclude and only excluded employees in managerial, confidential, or supervisory positions.  According to Member Wesley, there is no indication the unit determination decision in 1979 intended to exclude employees in the same classifications who work in less than permanent, full-time positions, such as retired annuitants.

Comments:

1. At first blush, this decision seems to involve a unit issue unique to the State’s BU6.  However, the legal principle enunciated by the Board majority in this decision has wide-ranging implications. Namely, the notion that retired annuitants are not automatically included in bargaining units containing full-time employees performing similar tasks presumably would apply to all of the statutes administered by PERB. 
2. The impact of this decision is also wide-ranging because retired annuitants are fairly common among public employers who are members of CalPERS, which includes many more employers than just the State.  Also, this decision presumably would apply to employees who are similarly situated to the retired annuitants in this case.  For example, many public employers utilize deferred retirement option plans (DROP’s) that function similarly to the retired annuitant system.
3. Lastly, the statement of facts in the decision notes that it was CCPOA attorney Ronald Yank who filed the grievance over the State’s use of retired annuitants to perform BU6 work.  Ron was recently appointed to be director of the Department of Personnel Administration, which defended this case against CCPOA.  It will be interesting to see whether CCPOA attempts to appeal this case to the courts or whether it will attempt to modify its unit determination to include retired annuitants.

Subtle Footnote … Has PERB Changed its Discrimination Standard?

Fontana Unified School District (2010) PERB Decision No. 2147-E (Issued on 12/10/10)

This case is a run-of-the-mill appeal of a Board agent’s dismissal. What caught my attention was what the Board put in a footnote:

“The Board does not adopt the references to Campbell Municipal Employees Assn. v. City of Campbell (1982) 131 Cal.App.3d 416 and San Leandro Police Officers Assn. v. City of San Leandro (1976) 55 Cal.App.3d 553 at p.3 dismissal letter and pp. 3-4 warning letter, as support for the well-established discrimination test set forth in Novato Unified School District (1982) PERB Decision No. 210 (Novato).”

The footnote was in reference to the following statement by the Board agent in the warning and dismissal letters:

... to state a prima facie case for unlawful retaliation, the charging party must show: (1) the employee exercised rights under EERA; (2) the employer had knowledge of the exercise of those rights; (3) the employer took adverse action against the employee; and (4) the employer took the action because of the exercise of those rights. (Novato Unified School District (1982) PERB Decision No. 210 (Novato); Campbell Municipal Employees Assn. v. City of Campbell (1982) 131 Cal.App.3d 416 (Campbell); San Leandro Police Officers Assn. v. City of San Leandro (1976) 55 Cal.App.3d 553 (San Leandro).

The Board agent cited to Campbell and San Leandro as support for PERB’s standard on establishing a prima facie case of discrimination. This was nothing new. A quick Westlaw search reveals that the exact language used by the Board agent in this case has been used in at least 27 ALJ and Board decisions in the past few years. In fact, the exact language used by the Board agent has been cited by the Board in at least 7 precedential decisions (See PERB Decisions Nos. 2112, 2091, 2086, 2065, 2057, 2021, 2020.) So what does this footnote mean?  It’s not entirely clear. 

Certainly, Campbell and San Leandro don’t enumerate the elements for establishing a prima facie case of discrimination.  Campbell and San Leandro arguably deal more with how to establish a case of interference, as opposed to discrimination.  So I think the Board is just saying that in the future Campbell and San Leandro should not be cited as support for the Novato elements.  The confusing part is that there still remain at least 7 precedential decisions using the exact same language the Board chose not to adopt in this case.  The Board didn't explicitly overrule those prior decisions.  So without a more thorough explanation it's difficult to tell what the Board intended to be the effect of the footnote.

My personal opinion is that the footnote is just an instructional comment from the Board to its Board agents.  I don't think there is any intent to change the Novato standard or somehow alter it by removing Campbell and San Leandro as supporting decisions.  I think the Board just realized, perhaps belatedly, that Campbell and San Leandro are unnecessary citations to support the Novato elements.

PERB Agrees to Judicial Review of Noon-Duty Aides Decision

Castaic Union School District (2010) PERB Decision No. J025-M (Issued on 12/7/10)

PERB has granted a request for judicial review by the California School Employees Association (CSEA) over the Board’s decision in Castaic Union School District (2010) PERB Decision No. A384E (“Castaic”).  In Castaic, the Board overturned longstanding precedent by holding that school district employees in part-time playground positions, also referred to as "noon-duty aides," who do not otherwise hold a position in the classified service, are not covered by the Educational Employment Relations Act (EERA).

Under EERA, PERB decisions on unit determination issues are not reviewable by the courts unless PERB grants a request for judicial review. (Gov. Code, § 3542.) It’s a procedure that is rarely requested. Here, PERB held that the unit determination issue was a “novel” one and of “special importance.” Accordingly, PERB granted the request for judicial review.  CSEA is now free to file a petition for relief with the courts.

Why You Need Local Rules….

City of Lodi (2010) PERB Decision No. 2142-M (Issued on 11/16/10)

I recently participated in a seminar sponsored by the California Public Employee Relations Program on local rules under the MMBA. One piece of advice I gave to the audieence was that every local entity in California should have its own local rules. Surprisingly, there many local jurisdictions that have not adopted local rules under the MMBA. By not adopting local rules, the PERB model rules (2 Cal. Code of Regs., §61000 et. seq.) apply to the local jurisdiction by default.

One important point to remember is that if you are a local entity subject to PERB's local rules by default, PERB will decide unit determination issues and conduct elections - not you.  One huge disadvantage to relying on PERB is that you have little control over how long the process takes. The recent City of Lodi decision is a great example of this.  PERB got involved in the City of Lodi case because the City's local rules didn't have a severance provision.  Here is the timeline in the Lodi case:

City of Lodi Timeline:

1. March 19, 2008: Severance petition filed
2. April 14, 2008: PERB determines there is sufficient proof of support
3. May 6, 2008: Settlement conference held
4. August 15, 2008: Formal hearing held
5. October 28, 2008: Transcripts completed. (PERB noted that the transcripts were delayed due to the lack of a state budget).
6. November 27, 2008: Closing briefs filed.
7. December 17, 2008: Proposed decision issued. Appeal filed.
8. November 16, 2010: Board decision issued.

Granted, I don’t know the background facts. Some of the delay may have been by mutual agreement or caused by circumstances that no one could control.  But the reality is that most cities and counties could have issued a decision on a severance petition faster than nine (9) months. So if you’re a local entity and you want to control your own destiny – I strongly advise you to adopt local rules.

PERB: Minimum Job Requirements Not Within Scope of Bargaining

City of Alhambra (2010) PERB Decision No. 2139-M (Issued on 10/26/10)

Facts

The City of Alhambra (City) operates under a merit system that requires competitive employment examinations. The City’s municipal code requires that any classification plan be adopted by the City Council. Under the City’s local employer-employee relations rules, the City retains the right to “establish and determine job classifications.”

In 2005, the City proposed and the City Council approved changes to the class specification for Fire Captain. Previously, the job classification for Fire Captain required both an Alhambra Fire Department Fire Engineer certification and Driver 1A and 1B certification for current fire engineers employed by the City. The change in 2005 made the requirement an Alhambra Fire Department Fire Engineer certification or Driver 1A and 1B certification for current fire engineers employed by the City. The City's goal was to expand the pool of potential applicants for Fire Captain.

The City did not notify the union of the proposed changes or seek to negotiate them. Instead, the City believed that pursuant to its local rules, it retained the management right to make changes to job classifications. The ALJ found that the change to the Fire Captain job classification involved a matter within the scope of bargaining. Because the City did not give the union notice of the change and an opportunity to bargain, the ALJ found that the City committed an unlawful unilateral change.

On exceptions filed by both parties, the Board reversed. The issue before the Board was whether the change fell within the scope of bargaining. In deciding this issue, the Board relied upon the three-part test set forth in Claremont Police Officers Assn. v. City of Claremont (2006) 39 Cal.4th 623 (“Claremont”). Under Claremont, the first inquiry is whether the management action has a significant and adverse effect on the wages, hours, or working conditions of the bargaining-unit employees. If so, the second inquiry is whether the significant and adverse effect arises from the implementation of a fundamental managerial or policy decision. If not, then the meet-and-confer requirement applies. However, if both the first two factors are present, the third inquiry is whether the employer’s need for unencumbered decisionmaking in managing its operations is outweighed by the benefit to employer-employee relations of bargaining about the action in question.

Significant and Adverse Effect

Addressing the first inquiry, the Board held that the change did not adversely impact wages or hours. The Board noted that the City’s change actually expanded the pool of potential applicants. In reaching this holding, the Board distinguished several prior precedential decisions finding changes to job classifications within scope. The Board held that those prior decisions must be read in light of Claremont. Under Claremont, the Board held that changes to the minimum qualifications for a job may be within the scope of bargaining if the change has a significant adverse impact. Here, the Board found that it did not.

Fundamental Managerial or Policy Decision

Even though it answered the first question in the negative, the Board considered the other two factors. The Board held that the “establishment of minimum [job] qualifications” was a fundamental managerial or policy decision under the MMBA. In reaching this decision, the Board drew a distinction between “promotional procedures, which are bargainable, and job qualifications, which are not.” The Board also considered that the position of Fire Captain affects the health and safety services provided by the City to the public.

Balancing Test

Finally, the Board held that even if the first two factors were present, it would find that the employer’s need for unencumbered decision making in this situation outweighs the benefit of bargaining over the decision. Specifically, the Board held that:

“This standard is not met in this case, as there is no evidence that bargaining over the expansion of the candidate pool for fire captains would outweigh the City’s need to determine the qualifications necessary to provide public fire protection services to its citizens. Accordingly, the charge and complaint must be dismissed.”

Comments

1. Prior to this decision, if you had asked me whether changing the minimum qualifications of an existing job classification in a bargaining unit was within the scope of bargaining, I would have answered yes (with rare exceptions; e.g. state mandated licensing requirements, etc.) Certainly, I would have advised notifying the union of any changes in case there were any negotiable effects. So at first blush, this decision seems to be a significant departure from existing PERB precedent. While the Board went to great lengths to argue that there was no precedent on the specific subject of “minimum qualifications” versus promotional procedures, the rationale underlying PERB’s existing decisions certainly pointed towards a change in minimum qualifications being negotiable. So I do believe this decision represents a departure; if not in actual precedential authority, then certainly in direction by the Board
2. That said, when you read the decision carefully it’s potentially much more narrow than at first blush. First, on its face it only applies to minimum qualifications versus promotional procedures. Obviously, there is a gray area between these two subjects and what happens in that gray area will have to be litigated in the future.
3. However, even though the holding is narrow, I believe this decision does represent a significant change in Board “direction”. The way the Board analyzed the second and third factors can be applied to many other areas that many people currently consider within the scope of bargaining. For example, grounds for discipline, including certain work rules, and other aspects of the disciplinary process would arguably satisfy the second and third Claremont factors under the Board’s analysis. In contrast, this decision suggests that the disciplinary process itself would be within the scope of bargaining.
4. While this decision may represent a change in Board “direction,” how long it will last remains to be seen. This decision was issued only a week before the November election. There are currently three Board members and one Board member’s term expires at the end of 2010. Therefore Governor Brown can appoint three Board members—a majority—immediately upon taking office.  So while this decision may represent a change in direction, employers would be wise to consider that it's coming at the end of an administration and that another "change" could be on its way. 

PERB: Unfair Practice Charge Does Not Block Election Certification

Salinas Valley Memorial Healthcare System (2010) PERB Decision No. A387-M (Issued on 10/25/10)

This case arose from a decertification election at the Salinas Valley Memorial Healthcare System (SVMHS). The National Union of Healthcare Workers (NUHW) sought to decertify SEIU-United Healthcare Workers West Local 2005 as the exclusive representative and to establish itself as the new exclusive representative. NUHW won the election. SEIU then filed objections to the result of the decertification election. The objections alleged that the SVMHS interfered with employees’ free choice in the election by: (1) changing its access rules for non-employee SEIU representatives; (2) allowing a management employee’s photograph to be used on a flyer supporting the NUHW; and (3) discriminating against, retaliating against, and/or interfering with the rights of several employees who supported SEIU. SEIU also filed an unfair practice charge against SVMHS based on the same allegations. The Regional Director held that SEIU failed to establish that SVMHS’s conduct interfered with employees’ free choice and therefore dismissed SEIU's objections. The Board affirmed.

In its appeal, SEIU argued that its objections to the election should not have been dismissed—and the election should not have been certified—until its unfair practice charge based on the same facts was decided. The Board has never addressed this issue before; namely, whether findings and conclusions in an election objection decision have any preclusive effect on identical allegations raised in an unfair practice charge. Citing NLRB precedent, PERB held that findings and conclusions in an election objection decision do not have preclusive effect in a related unfair practice charge.  PERB emphasized that there are “significant differences between representation and unfair practice proceedings … PERB may refuse to set aside an election even when the employer's conduct constituted an unfair practice if the conduct did not actually affect, or have a natural or probable effect on, employee free choice ... On the other hand, the employer's conduct need not constitute an unfair practice for PERB to set aside an election.”

Here, PERB noted that the Regional Director did not address whether SVMHS' alleged conduct constituted an unfair practice under applicable PERB standards. Rather, the Regional Director only determined that none of the alleged conduct actually influenced, or had the potential to influence, employee free choice in the decertification election. Therefore, PERB held that ruling on SEIU’s objections would not affect the subsequent unfair practice charge.

Comments:

1. PERB’s approach in separating the representation issues from the unfair practice issues makes sense and is practical. PERB has always prioritized representational issues, as it should. Delaying the certification of an election while an unfair practice charge is pending doesn’t make sense if the conduct has already been determined not to have influenced the election.
2. Here, SEIU filed its unfair practice charge two (2) days before the ballots were counted. It is important to note that SEIU apparently did not request that its unfair practice charge be considered a “blocking charge” and that the election be stayed.  Like the NLRB, PERB does allow for “blocking charges” prior to an election. A party must ask that an unfair practice charge be treated as a blocking charge and the Regional Director makes a decision on whether the stay the election.  The test is whether the conduct "will so effect the election process as to prevent the employees from freely selecting their representatives." See Jefferson School District (1979) PERB Decision No. Ad-66.

State Correctly Imposed Last, Best, Final Offer

State of California (Department of Personnel Administration) (2010) PERB Dec. No. 2130-S (Issued on 9/20/10)

The State of California (State) and the California Correctional Peace Officers Association (CCPOA) were parties to a memorandum of understanding (MOU) with a term of July 1, 2001 through July 2, 2006. Negotiations for a successor MOU reached an impasse in May 2007. Mediation was unsuccessful and in September 2007 the State notified CCPOA that it was implementing its last, best, final offer (LBFO) pursuant to Government Code 3517.8.

CCPOA then filed this unfair practice charge alleging, among other allegations, that the State unlawfully imposed its LBFO for a three-year term. The State denied that it implemented its LBFO for any set duration. Based on the evidence, PERB agreed with the State and dismissed the charge.  However, PERB went on to hold that even if the State had imposed a “term” on its LBFO, that in itself was not unlawful.  Citing to Rowland Unified School District (1994) PERD Decision No. 1053, PERB held that, “an employer may lawfully implement a term of agreement provision contained in its LBFO because such a provision, standing alone, does not act as a waiver of the union’s bargaining right for the specified period.” What is prohibited is imposing a waiver on the union; in essence, refusing to bargain during the term imposed.  Here, PERB found that the State never indicated that it was refusing to bargain going forward.  Accordingly, PERB held that even if the State had imposed a term of three years on its LBFO, that by itself was not an unfair practice.

Comments

1. In this decision, PERB has clarified that under the Dills Act, imposing a term on a LBFO is permissible as long as the employer remains willing to bargain during that term should impasse be broken.
2. Is this decision applicable to the other acts administered by PERB? I don’t see any reason why the rationale in this case wouldn’t also apply under EERA and HEERA. The MMBA, however, presents a more difficult question. Under the MMBA, upon impasse an employer may impose its LBFO but “shall not impose a memorandum of understanding.” (Gov. Code 3505.4.)  This is commonly understood to mean that an employer cannot impose a set term on its LBFO whereby the employer refuses to bargain during that term—an interpretation that is consistent with this decision. However, the provision in the MMBA that an employer “shall not impose a memorandum of understanding” could be interpreted to mean that an employer cannot impose any term at all, regardless of whether or not the employer stands ready to bargain. 
3. Practically, there really isn’t a difference between imposing a LBFO without any term versus imposing a LBFO with a term but being willing to bargain at any time. The latter is essentially imposing a contract with a re-opener that can be triggered by the union at any time—it basically renders the term provision meaningless. 

Dismissals Not Entitled to Preclusive Effect

Grossmont Union High School District (2010) PERB Decision No. 2126E (Issued on 8/13/10)

This case involved an employee who alleged that he received a negative performance evaluation and was demoted because of protected activities. Specifically, the employee alleged that the adverse actions were taken after he wrote a letter to the principal accusing the principal of violating the applicable collective bargaining agreement and because he requested union representation during a meeting with his manager. The Office of the General Counsel issued a complaint. After a formal hearing, the ALJ found no nexus between the adverse actions and the protected activities, and on that basis, dismissed the complaint.

Of interest was the fact that the employee had filed an unfair practice charge against his union for breach of the duty of fair representation (DFR) arising from the same set of facts. (See Service Employees International Union, Local 221 (Meredith) (2008) PERB Decision No. 1982.) In the DFR case, the Board found that the employee failed to state a prima facie case that his union caused or attempted to cause the District to reject him on probation. Relying on that decision, District in this case moved to dismiss the complaint.

In its decision, the Board declined to give preclusive effect to the prior DFR decision. Here’s what the Board held:

“In City of Porterville (2007) PERB Decision No. 1905-M, the Board, citing the "doctrines of res judicata and collateral estoppel," gave preclusive effect to a Board agent’s dismissal of identical allegations in a separate unfair practice charge. However, a Board agent’s review of a charge to determine whether it establishes a prima facie case of an unfair practice does not meet the "actually litigated" requirement for collateral estoppel. To be "actually litigated" for purposes of collateral estoppel, an issue must have been decided based on the presentation of evidence at a hearing. (Groves v. Peterson (2002) 100 Cal.App.4th 659, 668.) The Board has consistently held that the function of a Board agent’s investigation is not to resolve the merits of the case because such resolution is reserved for PERB ’ s hearing process. (Golden Plains Unified School District (2002) PERB Decision No. 1489; Eastside Union School District (1984) PERB Decision No. 466.) We therefore overrule City of Porterville, supra, to the extent it granted preclusive effect to a dismissal of an unfair practice charge based solely on a Board agent’s charge investigation.”

Thus, the Board has overruled City of Porterville and will no longer give preclusive effect to a dismissal. This issue doesn’t arise very often but practitioners should take note of this change in law.

PERB: School Noon-Duty Aides Not Covered by EERA

Castaic Union School District (2010) PERB Decision No. A384E (Issued on 8/09/10)

In an unexpected decision, PERB has held that school district employees in part-time playground positions, also referred to as "noon-duty aides," who do not otherwise hold a position in the classified service, are not covered by the Educational Employment Relations Act (EERA). This decision overturns the Board’s holding in Pittsburg Unified School District (1976) EERB Decision No. 3 (“Pittsburg”). What is significant is that the Pittsburg decision has been binding precedent for over 30 years; indeed it was the third decision ever issued by PERB (then known as EERB).

The Board based its decision on the language of Education Code section 45103, subdivision (b)(4), which states:

Part-time playground positions shall not be a part of the classified service, where the employee is not otherwise employed in a classified position. Part-time playground positions shall be considered a part of the classified service when the employee in the position also works in the same school district in a classified position.

Then Board then compared Education Code section 45103 with Government Code section 3540.1, subdivision (e), which states:

“Exclusive representative means the employee organization recognized or certified as the exclusive negotiating representative of certificated or classified employees in an appropriate unit of a public school employer.”

The Board interpreted the “plain language of the statute to mean that an exclusive representative may only represent a bargaining unit of certificated or classified employees and, therefore, cannot represent employees who do not fall into one of those two categories.”  According to the Board, the definition of "exclusive representative" limits the definition of "public school employee" to certificated or classified employees.  Thus, part-time playground employees are not considered “employees” for purposes of EERA.

As a result of the Board’s holding, the petition in this case to add part-time playground positions to an existing unit was dismissed. However, in the interesting move, PERB stated that it would only apply the holding in this case prospectively. Specifically, the Board stated that:

“We recognize that classified bargaining units may currently exist which include parttime playground positions. Because of the potential disruption to stable employer-employee relations that would result from application of this decision to such units, PERB will only apply this decision prospectively. (Palo Alto Unified School District, et al. (1979) PERB Decision No. 84; Peralta Community College District (197 8) PERB Decision No. 77.) Consequently, this decision does not affect existing units that include part-time playground positions.”

Member Wesley dissented from the Board’s decision that EERA does not cover part-time playground positions. Member Wesley argued that the definition of “employee” under EERA does not limit it to classified or certificated employees. Further, Member Wesley asserted that being excluded from the classified service has little bearing on whether an employee should be covered by EERA, as the purposes of the two statutory sections are different.

Comments:

1. It is fairly rare for the Board to overturn one of its prior decisions. It probably occurs once a year on average; perhaps a little more when there is a change of Governor. However, I can’t remember the Board ever overturning a decision as old as Pittsburg. As mentioned above, Pittsburg has been around for over 30 years and it was only the third decision ever issued by the Board. In terms of the merits of the decision, I think both sides have valid points. But given how long Pittsburgh has been around, I’m sure CSEA will appeal this case. It will be interesting to see how the Court rules.
2. For me, the really interesting portion of this case was the Board’s guidance on how this decision will be applied in the future. The Board acknowledged that many districts have part-time playground positions in bargaining units and that this decision could cause substantial disruption to those districts and employees. Therefore, the Board stated that it would only apply this decision prospectively. However, can the Board do that? I personally think it’s questionable. Here, the Board said that the plain language of the statute required that it hold that part-time playground employees are not covered by EERA. However, PERB cited to a couple of prior cases where it declined to apply a statutory interpretation retrospectively where such an application would “cause disruption and instability.” I think those prior decisions are distinguishable. But in its basic form, the legal question is this: Can an administrative agency charged with enforcing a statute decide not to enforce the plain language of the statute because it would cause disruption and instability?  I believe the answer is no; such a decision is one for the Legislature. My view is that if PERB says that under the plain language of EERA that these positions are not covered, it has no choice but to enforce that interpretation. Any “disruption or instability” in this situation is caused by the language of the statute, which is something for the Legislature to address.  I certainly understand why PERB only wants to apply this holding prospectively, I just don't know that it can do that when it says that the language of the statute is plain and clear.

PERB: State Properly Imposed Layoffs Prior to Completion of Effects Negotiations

State of California (Department of Corrections & Rehabilitation, Department of Personnel Administration) (2010) PERB Decision No. 2115-S (Issued on 6/10/10)

Facts

This case stems from the State’s decision to close the El Paso De Robles Youth Correctional Facility (El Paso) and the DeWitt Nelson Youth Correctional Facility (DeWitt) in response to an anticipated drop in the juvenile population held by the Department of Corrections and Rehabilitation (CDCR) resulting from the passage of SB 81. In November 2007, CDCR developed preliminary plans to close both the El Paso and the DeWitt facilities effective July 31, 2008. Given the language of SB 81, CDCR determined that closure of these two facilities was required in fiscal year 20082009.  The Governor incorporated the closure of these facilities into his proposed budget in January 2008 by not including funding for juvenile services at those facilities.

On March 24, 2008, the State gave written notice to the California Correctional Peace Officers Association (CCPOA) that the two facilities were closing and that affected employees would be subject to layoff. The parties then met and conferred over the effects of the layoffs on six occasions prior to the July 31, 2008 implementation date.  When no "effects" agreement was reached by July 31 the State went ahead and imposed the layoffs.

Decision

In its decision, PERB affirmed that the decision itself to lay off employees is a fundamental management right that is not subject to bargaining. At the same time, PERB affirmed that the “effects” of a layoff are subject to bargaining. In terms of timing, PERB held that in such a situation the notice, “must be given sufficiently in advance of a firm decision to make a change to allow the exclusive representative a reasonable amount of time to decide whether to make a demand to negotiate."

However, PERB then noted that there is an exception to this rule. Specifically, PERB has held that it is permissible to implement a managerial decision before the completion of bargaining over “effects” where:

1. The implementation date is not an arbitrary one, but is based upon either an immutable deadline or an important managerial interest, such that a delay in implementation beyond the date chosen would effectively undermine the employer’s right to make the nonnegotiable decision;

2. Notice of the decision and implementation date is given sufficiently in advance of the implementation date to allow for meaningful negotiations prior to implementation; and

3. The employer negotiates in good faith prior to implementation and continues to negotiate in good faith after implementation as to those subjects not necessarily resolved by virtue of the implementation.

Here, the Board found all 3 factors present. The Board also rejected the union’s contention that the State negotiated in bad faith. Accordingly, the charge was dismissed.

Comments

Many public agencies are currently considering layoffs because the budget situation for this fiscal year is not much better than last year. When public agencies do seek to impose layoffs, some unions adopt a tactic to try to delay the layoffs for as long as possible in the hope that the public agency will change its mind due to external political pressures. These unions will submit voluminous information requests, refuse to meet promptly, and/or otherwise engage in tactics to prevent the employer from quickly reaching impasse on "effects" negotiations. In these situations, employers should remember that is it possible to impose a managerial decision, such as a layoff, even when effects negotiations have not been completed if the elements in this case are present.  Obviously, it’s better to have reached agreement and/or impasse prior to implementation.  However, it’s good to keep this exception in mind.

Mendocino Attorneys Not Entitled To 1% Raise Under Former MOU

[UPDATE (5/20/10): Just received word that MCPAA has filed an appeal of this decision, so it's not yet final.]

County of Mendocino (2010) PERB Decision No. 2104-M (Issued on 4/21/10)
Facts:

In 2006, the Mendocino County Public Attorneys Association (MCPAA) successfully petitioned to remove several attorney classifications from bargaining units represented by two other unions, the Mendocino County Management Employees Association (MCMEA) and Service Employees International Union (SEIU). Under the MCMEA and SEIU contracts, the attorneys would have gotten a 1% salary increase effective September 2006 if they had remained in those bargaining units. The County’s position was that the attorneys were no longer entitled to the 1% salary increase since they were no longer part of the bargaining units represented by MCMEA and SEIU; and because the MCPAA had not yet negotiated a similar raise for its new unit.

However, in September 2006, all the attorney classifications nevertheless received a 1% salary increase. The County claimed that the increases were given by mistake and stopped them after 3 months. The County also took steps to recoup the mistakenly granted increases but stopped those efforts in response to objections from the MCPAA. MCPAA then brought this unfair practice charge alleging that the County committed an unlawful unilateral change by refusing to give attorneys the 1% salary increase. MCPAA also argued that the County’s efforts to recoup the money constituted a separate unlawful unilateral change.

Decision:

With respect to the denial of the 1% salary increase, PERB affirmed the ALJ’s proposed decision dismissing that charge. PERB held that since the attorneys were no longer in the bargaining units represented by MCMEA or SEIU, they were not entitled to the raises negotiated by MCMEA or SEIU. Specifically, the Board affirmed the ALJ’s finding that:

“Not inconsistent with the same line of authority, the NLRB has found that absent other proof [of] interference with employee free choice an employer is entitled to withhold benefits that employees would have obtained had they remained unorganized so long as the employer engages in good faith bargaining. (Chevron Oil Co. (1970) 182 NLRB 445, 449, citing Shell Oil Co. (1948) 77 NLRB 1306; McGraw-Edison Co. (1968) 172 NLRB 1604, 1609-1610.)”

With respect to the County’s attempted recoupment of the mistakenly given increases, PERB also affirmed the ALJ’s dismissal of that charge. In the proposed decision, the ALJ held that:

“Although the complaint alleges that the recoupment action constituted another aspect of the unilateral change, I find no violation because the County in reasonably short order desisted from collection of the overpaid compensation. The evidence does not demonstrate a change of generalized effect or continuing impact (i.e., a conscious creation of a new policy). [citations omitted]”

Comments:

1. This case is instructive because it involves an issue that arises fairly often in the public sector, but not too often with any single employer: what happens when there is a change in representation? Here, PERB affirmed that employees must take the bad along with the good when it comes to exercising free choice in representation. In this case, because the attorneys chose to create their own bargaining unit with a new exclusive representative, they weren't entitled to the salary increases due under their prior contract. That makes sense but its something employees, and employers, often don't realize.
2. My only other comment is on the issue of the County’s attempted recoupment of the money. The ALJ dismissed that charge—and the Board affirmed—because the County never actually recouped the money so there wasn’t any “unilateral change.” However, given that PERB had already held that the attorneys were not entitled to the money, and especially since everyone agreed that the raises were given by mistake, why would it have been a unilateral change if the County actually recouped the money? Seems to me the County would have been within its right to recoup the money; and arguably had a duty to the public to do so. So that part of the decision doesn’t make sense to me. However, one can argue that since PERB found no change, it didn’t have to reach the issue of whether the subject matter (ie recoupment of mistakenly given money) was within the scope of representation. That’s true; and that’s how I think that portion of the case should be interpreted.

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)

Facts:

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.

Decision:

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.”

Comments:

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.

AFSCME's Leafletting Was Not an Unfair Practice

AFSCME, Local 3299 (2010) PERB Decision No. 2105-H (Issued on 4/21/10)

Facts:

This case involved an unfair practice charge filed by the University of California (UC) against AFSCME. During bargaining, AFSCME began leafleting in front of several medical centers at various UC campuses. The expired contract between UC and AFSCME required the union to abide by specific access guidelines promulgated at each campus. Those guidelines set forth exactly where AFSCME could engage in leafleting and where it couldn’t (for example, because of patient access issues). During the leafleting at issue, it appears undisputed that AFSCME violated the access guidelines by leafleting in prohibited areas.  According to the PERB decision, UC officials asked the AFSCME members engaged in the leafleting to move, which they did.

AFSCME then went to court to seek a temporary restraining order (TRO) to enjoin UC from prohibiting the leafletting. The court granted the TRO but later denied a preliminary injunction on the ground that PERB had initial jurisdiction.

In its decision, PERB assumed that AFSCME was in violation of the contract when it engaged in leafleting in areas where the guidelines prohibited such conduct. However, because AFSCME agreed to move when confronted by UC officials, PERB held that AFSCME’s conduct was just an isolated breach of the contract, and not a repudiation of the contract that would constitute an unlawful unilateral change.

Comments:

1. First, I thought it was ironic that the union went straight to court to seek injunctive relief instead of going to PERB. As many of you know, the issue of whether PERB has exclusive jurisdiction over essential employee strikes is before the California Supreme Court in City of San Jose v. Operating Engineers Local Union No. 3 (Case No. S162647). (In fact, oral argument in San Jose occurred on May 5, 2010—but more on that tomorrow.) The unions have all lined-up solidly in favor of PERB having jurisdiction so that employers cannot go directly to court for injunctive relief.  So it’s ironic that the union here went straight to court.
2. With respect to the merits of this case, the key holding was the Board’s finding that because the union stopped the “breach” (ie stopped leafletting) when asked by UC, it was just an isolated contract violation and not a complete repudiation of the contract.  Because isolated breaches do not constitute an unlawful unilateral change, PERB affirmed the dismissal of the charge.  By itself, I don’t have a problem with this holding.
3. I’ve argued before that there should be some type of “safe harbor” provision whereby a party can correct a breach and not be guilty of an unfair practice. For example, in County of Sacramento (2008) PERB Decision No. 1943-M, the Board found a violation even though the County rescinded the change before it ever took effect. My position was that given the rescission, PERB should not have found that the County committed an unfair practice.
4. Indeed, it’s worth taking a look at what PERB said in County of Sacramento: 
   

   “The County argues that by rescinding the ordinance, there is no longer any policy change even arguably subject to meet and confer requirements, and the issue is now moot. In Amador Valley Joint Union High School District (1978) PERB Decision No. 74, however, the Board held that the later reversal or rescission of a unilateral action or subsequent negotiation on the subject of a unilateral action does not excuse a violation. [Citation.] … 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.” 

5. It’s difficult for me to square what PERB said in County of Sacramento with what happened in this case.  I believe the two cases are inconsistent.  Here, there was an undisputed breach. It was actually worse than in County of Sacramento since AFSCME actually did engage in leafleting in areas where it was prohibited. In contrast, in County of Sacramento the County rescinded the change before it ever took effect. Yet PERB found a violation in County of Sacramento but not one here.  Nevertheless, if I had to choose which holding I like better, it's the one in this case.  Even though the union prevailed in this case, in the future this will benefit employers more than unions since the vast majority of unfair practice charges alleging unlawful unilateral changes are directed against employers.
6. Lastly, in the interest of full disclosure, I must note that I currently represent the University of California in several PERB cases; although I was not involved in this one. As for the remainder of this case, I do think that there was sufficient evidence that AFSCME improperly disrupted university operations so that a complaint should have been issued. However, that was not the main focus of the Board’s decision so I didn’t delve into that aspect of the case.

PERB: San Diego City Attorney Improperly Bypassed Union

City of San Diego (Office of the City Attorney) (2010) PERB Dec. No. 2103-M (Issued on 3/26/10)

Facts:

This case arises from the pension funding crisis in San Diego. Very briefly, the crisis resulted from a series of poor decisions by City officials and trustees of the San Diego City Employees’ Retirement System (SDCERS) in the 1990’s. The poor decisions included twice delaying the City’s contributions to the retirement system, increasing future benefits for City employees, and underpricing employee purchases of retirement service credits. The net effect of these decisions was to grossly underfund the retirement system. As a result of the pension funding crisis, state and federal officials initiated civil and criminal investigations into the actions of public officials and others. State and federal prosecutors ultimately filed criminal charges against some of the SDCERS trustees, including the Local 145 president.

In 2004, Michael Aguirre (Aguirre) was elected the City Attorney on a campaign promising to clean up the financial mess facing the City. As part of that vow, Aguirre took aim at the underpricing of retirement credits by SDCERS. Specifically, under the union contract with Local 145, employees were allowed to purchase up to five years of retirement service credit at cost. However, in calculating the price for service credits, SDCERS staff grossly underestimated the true cost of the credits. Aguirre estimated it was a $147 million mistake. After he took office, Aguirre filed a civil action in an attempt to reverse the effects of the underpricing of the service credits. In addition, Aguirre issued a press release which gave rise to this unfair practice charge. The press release Aguirre issued directed employees to a form on the internet that they could submit to voluntarily rescind the prior purchase of service credits. Local 145 argued, among other allegations, that Aguirre’s actions constituted “direct dealing” with employees.

Decision:

While PERB dismissed the other allegations, the Board found that Aguirre’s press release constituted an attempt to bargain directly with employees, and was thus an unfair practice. In its decision, PERB held:

“This action goes beyond correcting the price shortfall and disregards the MOU language that expressly authorizes employee purchases of service credit at a price set by the retirement system. By soliciting employees to rescind their purchase of service credits, made in accordance with the MOU, the City has gone directly to the employees to obtain their waiver of a benefit negotiated by Local 145, based on the City’s subsequent determination that the credits were underpriced to the detriment of the City. Consequently, the city attorney’s direct request to employees to rescind service credit purchases, constituted bypass of the exclusive representative in violation of the MMBA.”

Comments:

1. This decision drew a dissent from member Dowdin. It was her first dissent as a Board member and only the 3rd dissent in a decision this fiscal year. (Both the other dissents were by member Neuwald. See PERB Decision Nos. 2058 and 2094.) Dowdin argued that merely informing employees of the rescission option did not interfere with the role of the exclusive representative since Aguirre’s goal was not to change the negotiated contract, but to correct a mistake.
2. I agree. Take, for example, a situation where the contract provides employees with 10 hours of vacation a month. By mistake, an employee receives 30 hours one month. Does the employer have to bargain with the union before it can correct the mistake? I think not. (Arguably, how the time is taken back may be negotiable as an “effect” but the decision itself, in my opinion, is not). In this example, the employer is not changing the terms and conditions of employment; namely, an employee’s entitlement to 10 hours of vacation a month. The employer is merely insisting on that condition by correcting a mistake.
3. In addition, I thought the majority too easily dismissed Aguirre’s argument that he was acting in his capacity as the City Attorney as opposed to acting in the role of the employer. As an illustration, let’s say in a prosecution for workers’ compensation fraud a District Attorney’s Office seeks restitution from the defendant. Let’s say the defendant happens to be an employee of the county. Does that fact mean that the DA must bargain with the union during this criminal proceeding in order to ask for the money back? Again, I think not. In this example, the DA is acting in his official capacity as opposed to an employer for purposes of collective bargaining. Granted, the situation in this case is slightly different, since this was not a criminal proceeding and Aguirre's role as City Attorney versus employer is much more blurred.  However, I thought the argument that Aguirre was acting in his capacity to enforce city laws was persuasive. Certainly, as I read the facts, it was not Aguirre's intent to bargain with employees in order to change a contractual provision. He was merely attempting to correct a mistake; a mistake that appeared to be undisputed.
4. Given how much litigation has already occurred in San Diego on this issue, I wouldn’t be surprised if this case is appealed. So it's not over yet.