California State Employees' Assn. v. Public Employment Relations Bd.

• Decision Date: 17 December 1996
• Docket Number: P,AFL-CI,No. B095012,B095012
• Citation: 51 Cal.App.4th 923,59 Cal.Rptr.2d 488
• Court: California Court of Appeals Court of Appeals
• Parties: , 154 L.R.R.M. (BNA) 2523, 114 Ed. Law Rep. 894, 96 Cal. Daily Op. Serv. 9171, 96 Daily Journal D.A.R. 15,121 CALIFORNIA STATE EMPLOYEES' ASSOCIATION, CSU Division, SEIU Local 1000,etitioner, v. PUBLIC EMPLOYMENT RELATIONS BOARD, Respondent; CALIFORNIA STATE UNIVERSITY, Real Party in Interest.

Page 488

59 Cal.Rptr.2d 488

51 Cal.App.4th 923, 154 L.R.R.M. (BNA) 2523,

114 Ed. Law Rep. 894, 96 Cal. Daily Op. Serv. 9171,

96 Daily Journal D.A.R. 15,121

CALIFORNIA STATE EMPLOYEES' ASSOCIATION, CSU Division, SEIU Local 1000, AFL-CIO, Petitioner, v. PUBLIC EMPLOYMENT RELATIONS BOARD, Respondent CALIFORNIA STATE UNIVERSITY, Real Party in Interest.

No. B095012.

Court of Appeal, Second District, Division 7, California.

Dec. 17, 1996.

Gary Reynolds, Yorba Linda, Howard Schwartz, Piedmont, and Claire Iandoli, Alameda, for Petitioner.

Rothner, Segall, Bahan & Greenstone, Glenn Rothner, Anthony R. Segall and Ellen Greenstone, Pasadena, as amicus curiae on behalf of Petitioner.

Robert G. Thompson, Deputy General Counsel, and Bernard McMonigle, Senior Public Employment Relations Counsel, for Respondent Public Employment Relations Board.

Christine Helwick, General Counsel, Donald A. Newman, Litigation Counsel, for Real Party in Interest, California State University.

JOHNSON, Associate Justice.

California State Employees' Association, CSU Division, SEIU Local 1000, AFL-CIO, petitions for review of a decision of the Public Employment Relations Board (PERB or Board). The Board rejected the proposed decision of the administrative law judge and found the California State University (CSU) had not committed an unfair labor practice by unilaterally suspending payment of merit salary adjustments without providing the union an opportunity to discuss the decision and its effects on its members.

A majority of the Board members concluded CSU did not have an established practice of paying merit salary adjustments (MSAs) and therefore CSU's obligation to fund them ceased at termination of the contract which provided for MSAs for the "duration" of the contract. In addition, the Board found CSU was statutorily prohibited from paying merit salary adjustments because the Legislature had not provided funds expressly for this purpose.

We conclude the Board's finding the CSU did not have an established practice of paying merit salary adjustments is not supported by the evidence and is contrary to established PERB precedent. We further conclude the Board's interpretation of the controlling contractual and statutory provisions is clearly erroneous. Accordingly, we reverse the Board's decision.

FACTS AND PROCEEDINGS BELOW

The Donahoe Higher Education Act established a unified and centrally administered state college system. (Stats.1960, 1st Ex.Sess., ch. 49, p. 397, § 1 [adding now §§ 66000 et seq., formerly §§ 22500-22705, to the Education Code].) The Act transferred administration of the state colleges from the Director of Education and State Board of Education to the trustees of the state college system. (See 37 Ops. Atty. Gen. 69; Ed.Code, § 66606 [formally § 22604].) The Act gave the trustees of CSU authority to decide matters concerning the selection, pay and classification of employees. (Ed.Code, §§ 66609, 89500.)

In response to an increasing demand among state employees for a formal system of collective bargaining, in the 1970's the Legislature enacted several measures to provide for collective bargaining in public employment. In 1975, the Legislature enacted the Educational Employment Relations Act (EERA). (Gov.Code §§ 3540, et seq.) In 1977, the Legislature adopted the State Employer-Employee Relations Act (SEERA). (Gov.Code, §§ 3512, et seq.) And in 1978, the Legislature enacted the Higher Education Employer-Employee Relations Act (HEERA). (Gov.Code, §§ 3560, et seq.) HEERA granted the right of collective bargaining to employees in the CSU and the University of California systems. (See Pacific Legal Foundation v. Brown (1981) 29 Cal.3d 168, 177, 172 Cal.Rptr. 487, 624 P.2d 1215.)

In enacting HEERA the Legislature found the "people of the State of California have a fundamental interest in the development of harmonious and cooperative labor relations between the public institutions of higher education and their employees." (Gov.Code, § 3560, subd. (a).) The Legislature intended HEERA "to provide the means by which relations between each higher education employer and its employees may assure that the responsibilities and authorities granted to the separate institutions under the Constitution and by statute are carried out in an atmosphere which permits the fullest participation by employees in the determination of conditions of employment which affect them. It is the intent of this chapter to accomplish this purpose by providing a uniform basis for recognizing the right of the employees of these systems to full freedom of association, self-organization, and designation of representatives of their own choosing for the purpose of representation in their employment relationships with their employers and to select one of these organizations as their exclusive representative for the purpose of meeting and conferring." (Gov.Code, § 3560, subd. (e).)

Petitioner, The California State Employees' Association, CSU Division, SEIU Local 1000, AFL-CIO (Union), is the exclusive representative of four employee bargaining units established under HEERA. ¹ In 1982 the union and CSU entered into their first collective bargaining agreement or "memorandum of understanding." The agreement covered the period of July 1, 1982, through June 30 1985. Apparently CSU paid merit salary adjustments for the duration of this agreement.

A subsequent agreement negotiated between the union and CSU for the period 1985 to 1989 provided "merit salary adjustments shall be subject to funds being appropriated by the Legislature and made available to the CSU specifically for merit salary adjustments." The CSU paid MSAs from 1985 to 1988. However, due to a budget shortfall and the Legislature's failure to specifically fund MSAs, CSU suspended payment of MSAs during fiscal year 1988-1989.

Historically, CSU received a specific allocation from the state budget to fund MSAs. However, the practice stopped during the administration of Governor George Dukemejian and during this period CSU apparently funded MSAs through alternative funding sources or from internal savings.

For the successor agreement the union sought to protect its bargaining unit employees from further suspensions of MSAs by eliminating the contract language making MSAs "subject to" specific funding from the Legislature. For the 1989 to 1992 agreement--the agreement at issue in this case--the parties agreed MSAs would be paid for the term of the agreement. Section 20.19 of the agreement provided: "Merit Salary Adjustments shall be paid effective July 1, 1989, and for the duration of this agreement, subject to provisions 20.18 and 25.2."

Section 20.18 explained the criteria for granting MSAs. This section provided "[m]ovement between steps on the salary range shall be based on merit and effective performance." Section 25.2 pertained to "reopeners," or renegotiation of contract provisions, during the term of the agreement. ² By its terms, the agreement was to expire on May 31, 1992.

The parties began negotiations on a successor agreement during the spring of 1992. The union presented its proposal on March 1, 1992. The union received CSU's proposal in mid-April 1992. ³ In early March the parties agreed their negotiations on a successor agreement would deal with the non-economic issues first before reaching economic issues.

On April 27, 1992, CSU's negotiator announced CSU intended to delete further provision for MSAs. CSU's proposal for the successor agreement was not to pay MSAs unless the Legislature specifically funded MSAs. CSU's announcement came at a time when the parties were still negotiating non-economic issues.

On May 31, 1992, the parties' prior agreement expired.

On June 1, 1992, CSU's representative told the union's bargaining representative all contract terms would be continued in effect during negotiations on the successor agreement "as long as progress is being made."

On June 9, 1992, CSU's representative informed the union's representative CSU's new position was to suspend payment of MSAs but to continue all other contract terms from the prior agreement during negotiations.

CSU suspended MSAs effective June 1, 1992. At the time the parties had not discussed any economic issues. In addition, as of June 1, 1992, the Legislature had not yet adopted a budget for the 1992-1993 fiscal year.

CSU refused to negotiate its decision to suspend MSAs and the effect of that decision on unit employees. CSU took the position it was only contractually obligated to pay MSAs "for the duration" of the agreement and the agreement by its terms expired the day before, on May 31, 1992. CSU contended it had contractual, as well as statutory, authority for its unilateral suspension of MSAs.

Prior to the suspension of MSAs, neither party had requested PERB to declare an impasse. ⁴ In late June the union requested impasse, which was opposed by CSU. The union withdrew the request on August 10, 1992. CSU requested impasse on November 20, 1992, which it later withdrew. The parties continued negotiations and in April 1993 reached a successor agreement.

In the meantime the union filed an unfair labor practice charge with PERB on July 6, 1992. After investigation, PERB's general counsel issued a complaint against CSU on January 11, 1993. ⁵ The complaint alleged that before June 1, 1992, MSAs were paid based on merit and effective performance, and that on June 1, 1992, CSU changed this policy by suspending payment of MSAs. The complaint claimed CSU took this action without affording the exclusive bargaining representative an opportunity to meet and confer over both the decision and the effects of the change in policy in violation of HEERA. (Gov.Code, § 3571, subds. (a) and (c), see fn. 5, supra.)

CSU filed its answer on January 29, 1993, admitting jurisdiction but denying any violation of HEERA. CSU further admitted suspending M.S.A. payments on June 1, 1992. CSU asserted as affirmative...