Mcie Self-study: Hot Topics in Public Sector Labor Law

• Publication year: 2020
• Author: By Kerianne Steele and Tim Yeung

MCIE Self-Study: HOT TOPICS IN PUBLIC SECTOR LABOR LAW

By Kerianne Steele and Tim Yeung

Kerianne Steele is a partner with Weinberg, Roger & Rosenfeld, where she represents unions and employees, primarily in the public sector. Tim Yeung is a partner with Sloan Sakai Yeung & Wong LLP, where he represents employers in all areas of employment and labor law. The views expressed in this article are the authors' individual perspectives and do not necessarily reflect the views of their law firms or their clients. Ms. Steele would like to thank her colleague, Ben Fuchs, for his contributions to this piece.

INTRODUCTION

In this article, the authors explore three hot topics: the duty to bargain during an emergency, potential legislation giving PERB new remedial authority, and the advent of Bargaining for the Common Good. Each section is prefaced with an introduction followed by either Ms. Steele providing the Labor Advocate's viewpoint or Mr. Yeung providing the Management Advocate's viewpoint, and then a counter viewpoint.

TOPIC 1: PANDEMIC AND WILDFIRE EMERGENCIES—IS THE DUTY TO BARGAIN SUSPENDED OR EXCUSED?

BACKGROUND

During the coronavirus pandemic and California wildfire season, collective bargaining relationships are being put to the test. On a nearly daily basis, representatives from both labor and management are presented with a new set of unprecedented problems they must resolve expeditiously. Public Employment Relations Board (PERB) precedent¹ provides labor relations advocates in the public sector some guidance regarding their bargaining obligations, but leaves many questions unanswered in the novel contexts of the pandemic and wildfires.

Some questions that have arisen since March 2020 are: Must an employer bargain with the union over which employees it deems "essential," as that term is used in the shelter-in-place orders issued by California's counties and state government over the past eight months? Does an employer have a unilateral right to decide whether an employee will be permitted to tele-work? If the employer activates its employees to perform Disaster Service Work,² such as helping operate a Red Cross emergency relief center, does the employer have to notify or bargain with the union first? If the public employer faces an unprecedented financial crisis and must achieve immediate cost-savings to balance its budget, can it reduce employees' work hours, wages or benefits without having to bargain?

The general rule under each of the PERB-administered collective bargaining statutes is that an employer must provide a union prior notice and an opportunity to bargain before implementing a change relating to the wages, hours, and other terms and conditions of employment of the represented employees. The employer usually must refrain from implementing the change until the parties have reached agreement or exhausted any applicable impasse procedures. PERB has consistently held that the duty to bargain also extends to the effects of a decision that has a foreseeable effect on matters within the scope of representation,³ even where the decision itself is not negotiable.⁴ An employer must provide timely notice and a meaningful opportunity to bargain over the reasonably foreseeable effects of its decision before implementation.⁵ But how does that general rule apply during a pandemic or wildfire? Under existing PERB precedent, there are exceptions to the general rule, but they are limited.

EMERGENCY EXCEPTION

The Meyers-Milias-Brown Act (MMBA), which applies to public agencies such as cities, counties, and special districts, establishes that covered public employers must provide "reasonable written notice to each recognized employee organization affected of any ordinance, rule, resolution, or regulation directly relating to matters within the scope of representation proposed to be adopted by the governing body or the designated boards and commissions" and to "give the recognized employee organization the opportunity to meet. . . ."⁶ However, these requirements are suspended "[i]n cases of emergency when the governing body or the designated boards and commissions determine that an ordinance, rule, resolution, or regulation must be adopted immediately without prior notice or meeting. . . ."⁷ In such circumstances, the public employer need only "provide notice and opportunity to meet at the earliest practicable time following the adoption of the ordinance, rule, resolution, or regulation."⁸

The same is true under the Trial Court Employment Protection and Governance Act (Trial Court Act), which applies to trial court employees.⁹

This "emergency exception" has been interpreted narrowly. The suspension of the MMBA/Trial Court Act's requirement to provide notice and opportunity to bargain only applies "under exceptionally limited circumstances."¹⁰ To meet the "exceptionally limited circumstances" burden, an employer must show that it: (1) acted pursuant to a "true emergency"; (2) had no opportunity to negotiate with the union before the unilateral adoption; and (3) had no alternatives available.¹¹

Is the pandemic or a wildfire a "true emergency" under the MMBA and Trial Court Act? A situation presents a true emergency, satisfying the first element, when it is an "unforeseen situation calling for immediate action."¹² Only one California court of appeal has provided guidance in defining an "emergency." Urgency must be present, but the magnitude of the exigency is also a factor.¹³ An emergency must have "a substantial likelihood that serious harm will be experienced" unless immediate action is taken.¹⁴ The anticipation that serious harm will occur if such action is not taken must have a basis firmer than mere speculation.¹⁵ An emergency reflects a situation of grave character and serious moment.¹⁶ The term "emergency" is not synonymous with expediency, convenience, or best interests, and it imports "more . . . than merely a public need."¹⁷

OPERATIONAL NECESSITY (OR FISCAL EMERGENCY) DEFENSE

An employer asserting an "operational necessity" defense has the burden of showing "an actual financial emergency which leaves no real alternative to the action taken and allows no time for meaningful negotiations before taking action."¹⁸

The authors are not aware of any instance in which an employer has satisfied this stringent standard.¹⁹ However, the California Supreme Court has ruled that, when faced with a decline in revenues or other financial adversity, public employers possess the managerial right to unilaterally decide to lay off some employees to reduce labor costs.²⁰ In this situation, the public employer must, however, give its employees an opportunity to bargain over the implementation of the decision, including the number of employees to be laid off and the timing of the layoffs, as well as the effects of the layoffs on the workload and safety of the remaining employees.²¹

FUNDAMENTAL MANAGERIAL OR POLICY DECISION EXCEPTION

The "fundamental managerial or policy decision exception" is not technically an "exception" to the general rule that an employer has a duty to provide prior notice and an opportunity to bargain. Instead, PERB and the courts have found that the public employer does not have a duty to bargain (in other words, there is no duty from which the public employer must be "excused") because the matter at issue is not within the "scope of representation." For example, the "scope of representation" under the MMBA includes: "all matters relating to employment conditions and employer-employee relations, including, but not limited to, wages, hours, and other terms and conditions of employment."²² The "scope of representation" under the MMBA excludes: "consideration of the merits, necessity, or organization of any service or activity provided by law or executive order."²³

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In the leading case interpreting the meaning of "scope of representation" under the MMBA, Building Material and Construction Teamsters Union, Local 216 v. Farrell (Building Material),²⁴ the California Supreme Court held that even when the action of an employer has a significant and adverse effect on the wages, hours, or working conditions of the bargaining unit employees, the employer may nevertheless have no obligation to bargain because of the "merits, necessity, or organization" limitation. If the action is taken pursuant to a fundamental managerial or policy decision, it is within the scope of representation only if the employer's need for unencumbered decision-making in managing its operations is outweighed by the benefit to employer-employee relations of bargaining about the action in question."²⁵

LABOR ADVOCATE'S PERSPECTIVE

Indeed, the State of California has declared an emergency in response to the pandemic and wildfires. Indeed, counties have proclaimed the same. It cannot be denied that an "emergency" exists, though not necessarily a "true emergency" under the MMBA or Trial Court Act. However, this emergency also presents an unprecedented opportunity to solidify labor-management partnerships. During this emergency, in most instances (if not all), public employers have sufficient time to provide the union prior notice and an opportunity to bargain over proposed changes affecting wages, hours, and terms and conditions of employment of union members. Public employers should, at a minimum, provide the union prior notice of changes it intends to make to respond to the emergency. The employer's prior notice obligation is such a simple obligation to satisfy, especially now that email, cell phone and Zoom communication between labor and management representatives is ubiquitous.

Employers should also meaningfully engage the unions in problem-solving in real time. Unions can assist employers in making quick decisions and help expeditiously communicate those decisions to hundreds or thousands of members. For example, many unions have helped employers quickly and efficiently inform employees of who among them would be required to report to work the following...