CourtSupreme Court of South Dakota
Citation2005 SD 76,699 N.W.2d 441
Docket Number No. 22721., No. 22720
PartiesBON HOMME COUNTY COMMISSION, Appellant, v. AMERICAN FEDERATION OF STATE, COUNTY, AND MUNICIPAL EMPLOYEES (AFSCME), LOCAL 1743A, Appellee. Kingsbury County Commission, Appellant, v. American Federation of State, County, and Municipal Employees (AFSCME), Council 59, Local 169, Appellee.
Decision Date15 June 2005

Mark A. Fahleson of Rembolt, Ludtke & Berger, LLP, Lincoln, Nebraska, Attorneys for appellants.

Lisa Z. Rothschadl, Bon Homme County State's Attorney, Tyndall, South Dakota, Attorney for appellant Bon Homme County Comm.

Gary W. Schumacher, Deputy Kingsbury County State's Attorney, DeSmet, South Dakota, Attorney for appellant Kingsbury County Comm.

Linda Lea M. Viken, Rapid City, South Dakota, Attorney for appellee.


[¶ 1.] These are appeals in two separate unfair labor practice cases primarily regarding public employer insistence on a "management rights clause" in their negotiated agreements. In both cases, the Department of Labor and the circuit court ruled that the employers had engaged in unfair labor practices. We affirm in part and reverse in part.

Bon Homme County v. AFSCME Local 1743A

[¶ 2.] The American Federation of State, County, and Municipal Employees (AFSCME) Local 1743A is the duly recognized union bargaining representative for the highway employees of Bon Homme County. In 1995, Bon Homme County and the union successfully negotiated a collective bargaining agreement. The agreement was effective from December 1994 until November 1996. In the summer of 1996, representatives on each side met to negotiate on a successor agreement. During the second negotiation session, the county informed the union that it intended on negotiating for a "management rights" clause. The parties reached impasse in negotiations, and, in December 1996, the county made its last, best, and final offer. When no agreement was reached, the county implemented its last offer.

[¶ 3.] In April 1998, the union requested that negotiation begin for the 1999 contract year. It was not long until the county's "management rights" language began to stall discussions. After fruitless negotiations, the county proposed its final offer. That offer included a $.22 per hour wage increase and the management rights clause.

[¶ 4.] On December 31, 1998, the union informed the county that its membership rejected the last, best, and final offer. The county refused to implement its offer unless the union agreed to the management rights language. The following management rights provisions were part of the county's final offer:

A. Except to the extent expressly limited by the specific language of this agreement, the county shall retain the right to manage the facility and its business including, the right to determine days worked, hours worked, shifts worked, and hours of shifts; the length of the work day and work week and if and when overtime shall be worked; to determine the starting and quitting time and the number of hours and shifts to be worked; to hire, promote, demote, layoff, discharge, suspend and transfer employees; to reduce hours in lieu of layoff; to determine the knowledge, skill, qualifications and other abilities of employees; to evaluate employees; to establish acceptable performance levels by employees and to modify those levels; to modify the date of method of paycheck distribution; to establish a new department; discontinue existing departments; to develop and modify all manner of work and safety rules and to establish disciplinary actions for violations of those rules; to develop and modify drug and alcohol and smoking policies; to determine the number of employees in each of the county's job classifications; and otherwise to generally manage the operation and to direct the work force.
B. The county shall also have the sole right to introduce new or improved methods or equipment, to determine types of machinery to be used, hours of work, quality of workmanship required, time standards to apply, and to develop and modify incentive pay plans.
C. The county may reorganize or discontinue the county services in whole or in part, sell or dispose of any part or all of its assets; move any or all of the county services and determine the number and location of its operations and the services and product handled. The county may subcontract or transfer work or operations as deemed necessary by management. It also reserves the right to assign supervisory and management personnel to perform bargaining unit work and to employ part-time employees as it determines is necessary.
D. The above rights are not conclusive, and it is understood that any of the rights, powers, or authority the county had prior to the signing of this agreement are retained by the county except those specifically united or modified by the agreement.

[¶ 5.] It is undisputed that AFSCME had agreed to similarly broad management rights language in other collective bargaining agreements. In fact, the union also had tentatively agreed to this language in earlier negotiations. But as negotiations proceeded, the union proposed deleting all of this management rights language. The county took the position that this was a subject that had been removed from the bargaining table in earlier negotiations. At its January 5, 1999 meeting, the county commission approved the salaries of its employees for 1999 and voted to fully implement its proposed management rights clause. However, union members did not receive the $.22 per hour raise given to other county employees.1 [¶ 6.] The union filed unfair labor practice charges against the county on March 29, 1999. A Department of Labor hearing was held on January 25-26, 2001. On February 21, 2002, the ALJ, Randy S. Bingner, issued his written decision. On appeal, the circuit court affirmed in part and reversed in part. Bon Homme County now appeals to this Court.2

Kingsbury County v. AFSCME Council 59 & AFSCME Local 169

[¶ 7.] AFSCME Council 59 is the state organization of the American Federation of State, County, and Municipal Employees Union, a division of the AFL-CIO. AFSCME Local 169, an affiliate of AFSCME Council 59, is the bargaining representative for the highway employees of Kingsbury County. In 1997, county and union representatives negotiated and entered into a collective bargaining agreement. The agreement was effective from January 1998 through December 1999. In March 1998, as allowed for in the agreement, the union notified the county that it desired to reopen negotiations on wages and other issues. The first session began in June 1998. From the outset, the negotiations were contentious.

[¶ 8.] The next session occurred the following month. Before the second session, the county notified the union that it intended to have a management rights clause in the agreement. Throughout the subsequent negotiations, the union raised general concerns over the proposed language and sought to address separately specific concerns. The county refused to move away from its proposal and the parties were soon at impasse. As a result of conciliation, the parties agreed to maintain the status quo for the duration of the agreement.

[¶ 9.] In June 1999, the parties began negotiating for a new contract. The county continued to insist on its management rights clause. After several letters and one last negotiation session, the parties declared an impasse. Conciliation with the Department of Labor failed to result in an agreement, and on December 23, 1999, the union filed a petition alleging an unfair labor practice. On January 7, 2000, the county notified the union that it intended to implement its last offer. The offer included the following management rights provisions:

Section 1. Except as specifically limited by this Agreement's provisions, the County retains the sole and exclusive right to exercise all management rights or functions.
Section 2. Without limiting the generality of the foregoing, the County has the right to control the use of all County property and its operating units and direct the work of the employees, including, but not limited to, the right to discharge, suspend, or otherwise discipline employees for just cause; to demote, transfer or promote employees; to establish, assign and change work shifts; to allocate and assign work to employees; to determine the amount of work needed and to lay employees off.
Section 3. The County also has the right to do the following: establish and change operating processes, workplace layouts, techniques, methods, equipment, or facilities used; the materials to be used; set standards and judge the quality and quantity of work, as well as other work performance factors; maintain quality and efficiency of operations; determine financial policies, including accounting procedures, cost of processing and/or providing services; and determine public relations policies.
Section 4. The County shall also retain the right to establish work schedules for employees, including the determination of starting times and the number of hours to be worked in any day, week or shift; to determine or change the number of employees necessary to operate any operating unit of the County; to determine the management organization for each County unit; to select who shall be hired and not hired; to utilize part-time and temporary employees; to determine the knowledge, skill, qualifications and other abilities of employees or applicants for employment; to evaluate the performance and skills of employees; to develop and implement job specific tests and evaluation to determine employee skills, abilities, and performance; to establish, revise and modify employee work rules; to decide where or when training on a particular operation or job is required, how much training is required, and the right to move, retrain and transfer employees; to establish or modify job duties and classifications,

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