PERB Settlements: Be Careful How You Word Them

Trustees of the California State University (San Marcos) (2011) PERB Decision No. 2195-H (Issued 8/12/11)

Facts
The California State University Employees Union (CSUEU) filed an unfair practice charge against the California State University at San Marcos (CSU) alleging that CSU committed an unlawful unilateral change and retaliated against an employee for protected activity. PERB issued a partial dismissal on the unilateral change charge but issued a complaint on the retaliation charge. CSUEU appealed the partial dismissal to the Board.

While the appeal on the partial dismissal was pending, the parties settled the remaining allegations in the complaint at a PERB informal conference. The settlement stated that it was “a full and complete resolution of the claims and disputes between the parties based upon the above-referenced matter” which was listed as the unfair practice charge number. While the settlement expressly required the dismissal of the pending complaint, it was silent on the pending appeal of the partial dismissal.

The Board—unaware of the settlement—later issued a decision reversing the partial dismissal. The retaliation case was then sent to an Administrative Law Judge (ALJ) for formal hearing. The ALJ denied CSU’s motion to dismiss the complaint based on the settlement on the ground that it was not clear from the settlement that the parties intended to dismiss the partial appeal. The case then went to hearing and the ALJ issued a proposed decision finding that CSU violated HEERA. CSU appealed the proposed decision to the Board.

Decision
The Board, in a 2-1 decision, reversed the proposed decision. The Board held that the complaint should have been dismissed because of the settlement. The Board found the language in the settlement that it was to be a “full and complete resolution” of the dispute to demonstrate the parties intent to dismiss all portions of the charge. The Board also noted that CSUEU did not file any objections to CSU’s appeal. Thus, the majority treated the settlement as a request by the parties to dismiss the complaint, which the Board granted.

Dissent
Member Huguenin dissented. In his dissent, Member Huguenin characterized the majority’s opinion as “one-sided” and argued that PERB should have declined to enforce the settlement since PERB does not have jurisdiction to enforce contract violations that are not otherwise unfair practices. According to the dissent:

Settlement agreements between parties to unfair practice cases are a trade: withdrawal by a charging party of its charge allegations in exchange for either performance or promise, or both, by the respondent. Under the rule the majority announces today, PERB will continue to tell charging parties that it cannot enforce the performance or promise due from the respondent, except where the respondent’s failure or refusal to perform independently constitutes an unfair practice under our statutes. Such cases are rare indeed, as most settlement agreements do not contain promised performance of sufficient scope that failure or refusal amounts to a unilateral change under our case law. Thus, under the rule the majority adopts today, PERB will give a respondent the benefit of its bargain by dismissal of a charge, but refuse a charging party the benefit of its bargained for exchange. This is one-sided, lacking the evenhandedness that should be PERB’s hallmark.

Comments:

To date in this fiscal year, the Board has issued 6 decisions, only two of which I consider to be “substantive” (of the other 4, 3 were DFR dismissals that were affirmed and the other was a withdrawal based on a settlement). Member Huguenin has dissented in both those decisions.
As with the other dissent (PERB Decision No. 2196-H), I also disagree with this one. However, how one views this case really depends on how you characterize
the facts. I agree with Member Huguenin that PERB should not be in the business of enforcing settlement agreements and that it must be even-handed on that issue. Here, however, I do not view this case as one requiring the enforcement of a settlement agreement but rather a case of PERB honoring the wishes of the parties to withdraw an appeal. PERB has historically honored requests by a party to dismiss a complaint and/or withdraw an appeal. Although PERB precedent requires that a withdrawal “effectuate the purposes of HEERA” (or whatever act may be applicable), I can’t remember the last time the Board declined to honor such a request.
Thus, the underlying facts of this case are critical. If it’s a dispute between the parties over whether the settlement requires CSUEU to dismiss an appeal, then I agree with Member Huguenin that that would constitute a situation involving the enforcement of a contract over which PERB has no jurisdiction. However, if it’s a case where both parties are requesting that PERB dismiss an appeal, then I agree with the majority that PERB should comply with that request absent some unusual circumstance.
Unfortunately, it’s not entirely clear whether CSUEU disputed CSU’s interpretation of the settlement. For example, the decision does not tell us whether CSUEU opposed CSU’s request to dismiss the complaint filed with the ALJ. It just says the ALJ denied the motion. Presumably, CSUEU must have
opposed the motion for the ALJ to deny it, but that’s not necessarily true. Further, if CSUEU did oppose the motion to dismiss before the ALJ, why didn’t it oppose CSU’s appeal before the Board on the same grounds? But since CSUEU did not file an opposition, why did it go to the trouble of proceeding with the ALJ hearing—which I presume it did? And if it went to the trouble of going through a hearing (which it won), why didn’t it defend it before the Board? In short, there are a lot of unanswered questions. But based on the facts set forth in the majority decision, it appears that CSUEU did not contest CSU’s assertion that the settlement was intended by both parties to dismiss the appeal of the partial dismissal. If you assume that to be the case, then I agree with the majority decision that this is just a matter of the Board honoring the parties’ request.
TIP: Obviously, this situation could have been avoided in the drafting of the settlement. PERB settlements tend to be informal and generally do not contain all the waivers and other provisions found in a typical employment litigation settlement. To some extent, it’s a good thing that PERB settlements are not so formal. However, as this case illustrates, sometimes things can fall through the cracks. As an employer, it’s important in a settlement that you get the union to agree to dismiss any pending unfair practice charge or complaint. If there is an appeal or exceptions pending, you’ll want to have the union withdraw those too. But remember, withdrawing an appeal or exceptions requires approval by the Board. Also, remember that withdrawing an appeal or exceptions will still leave any underlying decision in place. If you’re intent is to vacate an underlying decision that must be made clear and will also generally require approval by the Board. Finally, one thing I’ve learned is that once a settlement is reached, charging parties sometimes are slow in filing the necessary papers to get a case dismissed. That’s why in my settlement agreements I always include language stating that the settlement itself shall be deemed a request to dismiss/withdraw. The theory is that I, as the employer’s representative, can then use the settlement agreement as a request for dismissal and I don’t need to wait for the charging party to act.