Board: Impasse Not Reached If Rush To Impose

County of Riverside (2014) PERB Decision No. 2360-M (Issued on 3/25/14)

This was the oldest case on the Board’s docket. The facts date back to bargaining between the County and SEIU in 2009. Basically, the County declared impasse and imposed its last, best, and final offer (LBFO). (Note: This was before AB 646, so no factfinding was required.) SEIU argued that the County’s imposition of its LBFO was improper because the parties were not at a genuine impasse.

The key issue before the Board was whether the parties were at impasse when the County imposed its LBFO. Relying on cases under the other acts, the Board held that under the MMBA “an employer’s premature imposition of its LBFO, prior to reaching impasse and exhausting impasse resolution procedures, if they exist, is an illegal unilateral change.” Impasse is reached where the parties have considered each other’s proposals and counterproposals, and nonetheless have “reached a point in their negotiations where continued discussion would be futile.”

The Board recognized that determining whether an impasse exists is a fact intensive inquiry. Among the factors the Board will consider include: the number and length of negotiating sessions between the parties; the time period over which negotiations have occurred; the extent to which proposals and counterproposals have been made and discussed; the number of tentative agreements reached; and the extent to which unresolved issues remain. After considering these factors, the Board concluded that the County’s declaration of impasse was premature. The major factor relied on by the Board was the ALJ’s finding that the County considered it “absolutely imperative to have concessions in place by the time the new budget began hitting the books.” The County’s budget assumed 10% in labor concessions and the County did not want to go into deficit at the beginning of the fiscal year by not having labor concessions in place. In response to the County’s claim of economic urgency, the Board responded that:

We recognize that it, and virtually every other public agency in California was under severe economic pressure during the period of time encompassed by these negotiations. It has long been noted that such economic exigency provides no justification for suspending the duty to bargain in good faith … Nor is an employer’s deadline such as the beginning of a budget year or the expiration of an MOU, an excuse to avoid bargaining in good faith.”

According to the Board, the County could have changed its economic proposals to take into account its increased costs if negotiations went into the next fiscal year.

Comments:

This case was on the Board’s docket for about 2 years. The ALJ’s proposed decision was issued on July 15, 2011. I’m not sure why it took so long to issue a decision. It’s possible there were factors outside of PERB’s control that caused part or all of the delay. In any event, this case illustrates the downside—to both the union and the employer—of the PERB process. It’s ironic that one of the reasons for placing the MMBA under PERB’s jurisdiction was that PERB was supposed to be able to resolve disputes faster than the courts. However, those of us who handle civil writs in superior court (which is how unfair practice charges involving cops are handled) can generally get them heard well within a year. So while I applaud this current Board’s efforts to speed things up—and its transparency in doing so—there is obviously more work to be done.
This case also illustrates how management and labor often view negotiations in fundamentally different ways. Here, the County’s fiscal year begins July 1. Negotiations began in March (but may not have begun in earnest until May). Assuming a March start date, there really is no reason why negotiations couldn’t have been completed by July 1. From my perspective, it’s clear the union was stalling because it didn’t want to agree to concessions. The union knew that every day it delayed was money saved for its members. And if the union could drag things well into the new fiscal year, it probably believed the County would get desperate and be willing to cut a better deal. From the union’s perspective, the County was in a rush to impose concessions by July 1 and had no intention of listening to alternatives. The union probably felt that the County was just going through the motions of “bargaining” but really had no intention of backing off its proposals.
So it basically boils down to this question: Is the union stalling or is the employer in a rush to impose? Let’s be totally honest. The answer is seldom one or the other, but a mixture of the two. However, the important take-away from this case is that the current Board is not very sympathetic to public agencies using the July 1 start of the fiscal year as a “deadline.” I think the Board views the start of the fiscal year as an artificial deadline. In the view of this Board, employers can just propose additional concessions in order to make up budget savings if an agreement is not reached by July 1. While I disagree with this viewpoint, negotiators need to be aware of it and act accordingly.