Appeal of Franklin Educ. Ass'n, NEA-New Hampshire, NEA-NEW

• Decision Date: 10 November 1992
• Docket Number: No. 90-478,NEA-NEW,90-478
• Citation: 616 A.2d 919,136 N.H. 332
• Parties: , 79 Ed. Law Rep. 166 Appeal of FRANKLIN EDUCATION ASSOCIATION,HAMPSHIRE (New Hampshire Public Employee Labor Relations Board).
• Court: New Hampshire Supreme Court

Page 919

616 A.2d 919

136 N.H. 332, 79 Ed. Law Rep. 166

Appeal of FRANKLIN EDUCATION ASSOCIATION, NEA-NEW HAMPSHIRE (New Hampshire Public Employee Labor Relations Board).

No. 90-478.

Supreme Court of New Hampshire.

Nov. 10, 1992.

James F. Allmendinger, Concord, Staff Atty., NEA-New Hampshire, on the brief and orally, for petitioner, Franklin Educ. Ass'n.

Kidder & Lawson, Laconia (Bradley F. Kidder, on the brief and orally), for respondent, Franklin Bd. of Educ.

JOHNSON, Justice.

The petitioner, the Franklin Education Association (the association), appeals a decision of the New Hampshire Public Employee Labor Relations Board (PELRB) ordering the association and the respondent, the Franklin Board of Education (the school board) to return to the negotiating table. We hold that the school board violated its duty to negotiate in good faith with the exclusive representative of the association, see RSA 273-A:5, I(e), and therefore reverse and declare the teachers' June 1990 contracts invalid. We also hold that the Franklin City Council (the council) did not impliedly ratify the parties' collective bargaining agreement (the CBA). Accordingly, we hold the April 1990 teacher contracts to be likewise invalid.

We relate only those facts, and address only those arguments, relevant to the dispositive issues of implied ratification and bad faith negotiation. The school board and the association began negotiating in the fall of 1989 for a CBA to cover the 1989-92 school years. They reached a preliminary agreement in January 1990, establishing wage increases of 4.3, 16.67, and 13.8 percent, respectively, for the three years of the agreement. A final agreement was signed in March 1990, and the school board decided to fund the first year salary increases out of money the council had appropriated for the school board's use several months earlier, in September 1989. On April 6, 1990, the school board issued contracts to its teachers reflecting the wage levels agreed upon by the parties and memorialized in the CBA. A month later, the school board submitted the CBA to the council for approval of the contract's cost items, pursuant to RSA 273-A:3, II, but the council rejected the cost items on May 10, 1990.

On June 1, 1990, the school superintendent received a letter from the city solicitor advising that the council would finalize its 1990-91 budget on June 4, 1990, a Monday. The solicitor suggested that the school board reopen negotiations with the association, and stated:

"If the School Board is desirous of taking any action which will have a potential impact on the Council's decision, then that action must be taken before the budget is set. It would not be wise for the School Board to assume that favorable action may be taken at a later date as State law requires a greater majority for a supplemental budget appropriation than that necessary to set the budget coming up on June 4th."

In response, the school board met in emergency session on Saturday, June 2, 1990, and voted to rescind the April contracts, issue new ones, and request the association to renegotiate. The new contracts had been prepared the previous day (the day the superintendent received the city solicitor's letter) and reflected salaries lower than those agreed to in the CBA. On Monday, June 4, 1990, the school board negotiator notified the association negotiator of these actions. The teachers received their new contracts the same day. The association filed an unfair labor practice charge with the PELRB, but the PELRB dismissed the charge and ordered the parties to return to the negotiating table. The association brought this appeal.

The association argues that the council impliedly ratified the parties' CBA, thus binding the school board to the April 1990 contracts based on the CBA. The association avers that the council knew of cost items contained in the CBA as early as January 1990, and knew that the school board was funding the contract's first year cost items out of money that the council had appropriated to the school board. Under Appeal of Sanborn Regional School Bd., 133 N.H. 513, 579 A.2d 282 (1990), the association contends, implied ratification of the CBA's first year cost items constitutes ratification of the CBA's second and third year cost items.

The association's argument misses a central component of the Sanborn holding: the legislative body of a municipality (in this case, the council) is bound by a multi-year contract only if it knew about the cost items for each year of the CBA at the time it voted to appropriate money for the contract's first year. Id. at 522, 579 A.2d at 287. Here, the council did appropriate money that was eventually used by the school board to fund the cost items of the CBA's first year. There is no evidence, however, that the council knew of those cost items--let alone the cost items for the second and third years of the CBA--in September 1989 when it approved the appropriation; the parties did not reach even a tentative agreement until January 1990. We therefore hold that the council did not impliedly ratify the CBA's cost items. As the council explicitly rejected those cost items in May 1990, the April 1990 teachers' contracts, contingent upon the items' approval, are not binding. See RSA 273-A:3, II(b); Sanborn, 133 N.H. at 520, 579 A.2d at 285-86.

The association next argues that the school board violated its duty to negotiate in good faith with the association's exclusive representative. The school board counters that it fulfilled its statutory and contractual obligations by notifying the association negotiator on June 4, 1990, of its intent to renegotiate. We agree with the association that the school board's "direct dealing" with the teachers violated its duty to bargain in good faith.

The relevant statutory and contractual provisions are as follows. RSA 273-A:5, I(e) states that "[i]t shall be a prohibited practice for any public employer ... [t]o refuse to negotiate in good faith with the exclusive representative of a bargaining unit...." RSA 273-A:3, I, provides in part that

"[i]t is the obligation of the public employer and the employee organization certified by the board as the exclusive representative of the bargaining unit to negotiate in good faith. 'Good faith' negotiation involves meeting at reasonable times and places in an effort to reach agreement on the...