Maranacook Area Sch. Ass'n v., SUPERIOR COURT AUGUSTA DOCKET NO. AP-14-38

• Decision Date: 11 December 2014
• Docket Number: SUPERIOR COURT AUGUSTA DOCKET NO. AP-14-38
• Parties: MARANACOOK AREA SCHOOL ASSOCIATION, Petitioner, v. R.S.U. NO. 38 SCHOOL BOARD et al., Respondents.
• Court: Maine Superior Court

MARANACOOK AREA SCHOOL ASSOCIATION, Petitioner, v. R.S.U. NO. 38 SCHOOL BOARD et al., Respondents.

SUPERIOR COURT AUGUSTA DOCKET NO. AP-14-38

Superior Court of Maine

December 11, 2014

STATE OF MAINE

KENNEBEC, ss.

ORDER OF COURT

The undersigned heard oral argument in this matter on October 10th, 2014. In its M.R. Civ. P. 80C¹ complaint filed May 29, 2014, the Maranacook Area School Association ("Association") alleges that the Maine Labor Relations Board ("MLRB") erred by concluding that enforcement of a salary step increase provision in the parties' expired collective bargaining agreement in arbitration under 26 M.R.S.A. § 964-A(2) was precluded by the Law Court's holding in Board of Trustees of the University of Maine System v. Associated COLT Staff of University of Maine System, 659 A.2d 842 (Me. 1995) (hereinafter "COLT"). The Association also claims the MLRB committed procedural errors by failing to honor the Association's request for a hearing in order to create a record and by the hearing officer declining the Association's request to recuse herself from the case "despite her conflict of interest."

In addition to the above, in its Brief and at oral argument the Association also claimed errors were made in relation to:

a) The MLRB denying the Association's request to file a reply to R.S.U. No. 38 School Board's reply brief; b) Failure of the MLRB to adopt rules "necessary to establish a procedure to implement the intent of 26 M.R.S. §964-A"; and

c) Refusal of the MLRB to allow an evidentiary hearing on the issue of recusal of the hearing officer.

I. Background:

The Regional School Unit No. 38 ("RSU 38") is comprised of the municipalities in Manchester, Readfield, Wayne, and Mt. Vernon. The Association is the bargaining agent within the meaning of 26 M.R.S.A. § 962(2) for a bargaining unit of teachers and certain other professional staff members employed by the RSU 38 School Board (the "School Board"). The most recent collective bargaining agreement ("CBA" or "Agreement") between the School Board and the Association expired on August 31, 2013. Record, Petition for Determination at Article 24. Upon expiration of the Agreement, the School Board continued to maintain the static status quo² with respect to all matters covered by the expired Agreement, including the salaries paid to bargaining unit members. Under the static status quo, employees are paid the same salaries they were paid before the contract expired, but do not receive the annual salary step increases set out in the Agreement.

On October 11, 2013, the Association filed a grievance alleging that salary step increases should have been given to the bargaining unit members effective at the start of the 2013-2014 school year. Record, Petition for Determination, Ex. B. The Superintendent and the School Board denied the grievance, and the Association notified the School Board by letter dated November 22, 2013 that it wished to proceed to arbitration with respect to the grievance. Record, Petition for Determination, Ex. C.

By cover letter dated December 11, 2013, the School Board filed a petition under 26 M.R.S.A. § 964-A seeking a determination that the salaries payable after the expiration of the Agreement were subject to the static status quo doctrine and that teachers could not claim a right to be paid experience step increases after the contract expired. Record, Item 2.

The Association filed a response to the Petition dated January 8, 2014, alleging that the MLRB had no jurisdiction to hear the Petition but did not make any arguments concerning the merits of the Petition. Record, Item 3, The School Board filed a brief dated January 31, 2013. Record, Item 4. The Association subsequently withdrew its jurisdictional objection. Record, Respondent's Brief,3/10/14, In an Interim Order dated March 21, 2014, the MLRB determined that no evidentiary hearing would be held and that the parties should submit written arguments. Record, Item 7.

The Association subsequently submitted a brief addressing the merits of the Petition (Record, Item 9), the School Board submitted a reply brief responding to the Association's arguments (Record, Item 10), and on May 15, 2014, the MLRB issued its Status Quo Determination (Record, Item 1),

II. Standard of Review:

The Court reviews the MLRB's decisions for "error of law, abuse of discretion, or clear error." City of Augusta v. Me. Labor Relations Bd., 2013 ME 63, ¶ 14, 70 A.3d 268 (citing COLT 659 A.2d at 844). The Court will "defer to the agency's interpretation and application of the statute" when the administration of that statute has been entrusted to the agency by the Legislature. Id. (quoting AFSCME Council 93 v. Me Labor Relations Bd. 678 A.2d 591, 593 (Me. 1996). The Court grants the MLRB "considerable deference in constructing the Municipal Public Employees Labor Relations Law ("MPELRL"). Mountain Valley Education Ass'n v. Me. Sch. Admin Dist. No. 43, 655 A.2d 348, 351 (Me. 1995).

III. Issves:

Whether the Salary Step Increase Provision in the Association and School Board's Collective Bargaining Agreement Continues to be Effective Following the Expiration of the Agreement in Light of The Law Court's Decision In COLT.

At the outset the undersigned notes that according to one author "[D]uring the 1960s and 70s, the spread of strikes by teachers prompted many states to enact collective bargaining statutes to codify the means of negotiations between teachers and school districts. Today, thirty-five states authorize collective bargaining and utilize mediation, fact-finding procedures, and/or arbitration procedures to settle bargaining impasses. In addition, in collective bargaining statutes, twenty-seven states now prohibit teacher strikes and eighteen states impose penalties for teacher strikes. As a result of this type of state legislation, both national and local teachers' unions have emerged as powerful entities that negotiate collective bargaining agreements on behalf of teachers...."³

Similar to this case, the Law Court in COLT addressed whether the University of Maine breached its duty to bargain in good faith by discontinuing the annual step increase in wages included in a collective bargaining agreement that had expired. COLT, 659 A.2d at S43. The alleged breach was based on an obligation to maintain the status quo⁴ following the expiration of a contractimplicit in the requirement to bargain in good faith. Id. In the underlying proceeding, the MLRB determined that the University's failure to honor the annual step increases in wages constituted a unilateral change in the status quo prohibited by Maine law. Id. The Law Court disagreed with the MLRB and affirmed the Superior court's decision vacating the MLRB's decision based on considerations of fairness as well as the Legislature's Intent to protect municipal and state agency budgets from increases in wages imposed without agreement by the governing body. Id. at 844-846.

In addition, COLT explained that "[b]eyond the unfairness of the dynamic status quo rule's application" the so-called dynamic status quo rule was in "contravention of the statutory language and the legislative history of Maine's public employment labor relations law." Id. The Law Court explained that the section imposing the duty to negotiate in good faith, and thus maintain the status quo when a contract expires, also provides that "neither party shall be compelled to agree to a proposal or be required to make a concession." Id. (quoting 26 M.R.S.A. § 1026(1)(C)). The payment of wages, the Law Court explained, can have an "enormous impact" on the University's budget and constituted a "substantial concession" by the University in direct contravention of the prohibition contained in section 1026(1)(C). Id. (citations omitted).

Furthermore, the Law Court found that other statutory provisions made clear that "the Legislature was careful to protect the public fisc from wage increases that were neither bargained for nor approved by the public employer" including section 1026(4)'s restriction that arbitrators may only recommend, and not bind parties as to salaries and pensions in Maine. Id. (citing 26 M.R.S.A. § 1026(4)). Finally, the Law Court explained that the "dynamic status quo rule...obligates the University to pay substantial increases in wages not approved by its trustees, and dramatically alters the status and bargaining positions of the parties. It changes, rather than maintains the status quo." Id. at 846. While the dynamic status quo rule could "be utilized in private sector labor law, and in some public sector labor law, its adoption by the [MLRB] is contrary to the intent of Maine's public employer labor statute as expressed it its plain language and history." Id. Accordingly, COLT provided a stern renunciation of the dynamic status quo rule as applied to wage increases for organizations governed by MPELRL.

Nevertheless, the Association attempts to distinguish COLT, by pointing to MLRB decisions from 1991 when the dynamic status quo rule was first adopted with the implication that they are still good law. However, as discussed above, COLT explicitly rejected the dynamic status quo rules in cases like the one before the undersigned, where an expired agreement provides for salary step increases. Furthermore, the Legislature "incorporated the concept of the 'static status quo' into the municipal employee collective bargaining statutes.'" City of Augusta v. MLRB, 2013 ME 63, ¶ 18, 70 A.3d 26S (citing 26 M.R.S.A. § 964-A(2) (providing in pertinent part that grievance arbitration provisions continue afterthe expiration of a collective bargaining agreement, but only for provisions "enforceable by virtue of the static status quo doctrine")).

"The Law Court's ruling in COLT and the Legislature's subsequent incorporation of the static status quo into MPELRL also undermines the Association's argument that COLT is distinguishable because it relied heavily on the "fairness" issue and the "budgetary"...