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San Diego Housing Commission v. PERB (San Diego County Superior Court Case No. 37-2012-00087278) (Active case)

With the passage of AB 646, one of the biggest fears of employers was that PERB would interpret the statute to apply to situations other than bargaining to reach a Memorandum of Understanding (MOU), such as effects bargaining.  Well, our fears have come true.  The San Diego Housing Commission (Commission) is currently embroiled in litigation with PERB over this exact issue.

The facts of this case are simple.  In 2012, the Commission notified SEIU Local 221 that it would be laying off employees due to budgetary reasons.  The parties then engaged in effects bargaining.  According to the Commission, SEIU’s only proposal during effects bargaining was to ask that 2 employees be rehired (which we all know is not a real effects proposal).  The Commission said no.  SEIU then declared impasse and sent a letter to PERB requesting that the “dispute” be submitted to factfinding.  PERB then initiated factfinding proceedings.

The Commission disputed PERB’s assertion of factfinding jurisdiction over the effects bargaining dispute and initiated litigation against PERB in San Diego County Superior Court.  PERB filed a demurrer which appears scheduled to be heard on March 1, 2013.  However, all the papers have already been filed so we know PERB’s position in this matter.

In its petition for a writ of mandate, the Commission’s main argument is that AB 646 mandates factfinding only for disputes arising from negotiations for a Memorandum of Understanding (MOU).  This is based on the language of MMBA section 3505.1 and the Legislative history behind AB 646.  In its demurrer, PERB asserts that, “Factfinding Under the MMBA Applies to a Wide Variety of Collective Bargaining Negotiations Other Than Those for a CBA or MOU.”  In support, PERB cites to a variety of court cases that have upheld the requirement to meet and confer over subjects within the scope of bargaining, even in situations where the parties were not negotiating towards a MOU.  In its reply, PERB emphasizes that, “Nowhere in this statute [AB 646], or in the MMBA, does it state that factfinding is applicable only to an impasse in negotiations for an MOU.”  PERB further argues that factfinding under AB 646 is a mandatory impasse procedure and that, “public employers are prohibited from making a unilateral change on a matter subject to impacts and effects bargaining until impasse procedures have been exhausted.”  Thus, PERB’s position is that: 1) an impasse in bargaining over layoff effects is subject to AB 646, and 2) an employer, subject to limited exceptions, may not implement a layoff until all impasse procedures, including factfinding, are concluded.


  1. Wow.  If PERB’s position is allowed to stand it will have dramatic implications for employers.  I strongly believe that AB 646 should not be applied to effects bargaining.  First, such disputes are not economic in nature and generally are not the type of disputes that might benefit from factfinding.  Second, and most important, requiring employers to go through factfinding essentially eviscerates the fact that the underlying decision is a management right.
  2. One of the arguments asserted by PERB is that the Commission has applied too narrow of a definition of the term “Memorandum of Understanding.”  The Commission interprets to term the way I do – it’s a comprehensive agreement between the parties setting forth all major terms and conditions of employment for a specified term.  PERB asserts that the MMBA doesn’t define MOU that “narrowly” and that the term MOU should be interpreted to mean any “agreement” on a subject of bargaining.  Thus, according to PERB, when parties reach an agreement on effects bargaining over a layoff, they have reached a “MOU.”
  3. I find this argument particularly weak and unsupportable.  The fact is the term “MOU” is a term of art and any labor practitioner knows it.  Similarly, the terms “meet and confer” versus “consult” or “discuss” are also terms of art.  To a lay person, “confer” is the same thing as “consult” or “discuss.” But to a labor practitioner these terms are very different.  So when the MMBA uses the term “MOU” we all know what that means, or at least I thought we did.  So I’m really puzzled why PERB took such a position which was unnecessary in my opinion; PERB could have still made its argument based on MMBA section 3505 which does not reference MOU.
  4. One more note, the union involved in this case is SEIU Local 221.  Last week, the Governor appointed Eric Banks, the former President of Local 221, to the Board.

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