Municipality of Metropolitan Seattle v. Public Employment Relations Com'n

• Court: Washington Supreme Court
• Writing for the Court: ANDERSEN; DORE
• Citation: Municipality of Metropolitan Seattle v. Public Employment Relations Com'n, 826 P.2d 158, 118 Wn.2d 621 (Wash. 1992)
• Decision Date: 12 March 1992
• Docket Number: No. 57935-1,AFL-CI,P
• Parties: MUNICIPALITY OF METROPOLITAN SEATTLE, Respondent, v. PUBLIC EMPLOYMENT RELATIONS COMMISSION and International Federation of Professional and Technical Engineers, Local 17,etitioners.

Page 621

118 Wn.2d 621

826 P.2d 158

MUNICIPALITY OF METROPOLITAN SEATTLE, Respondent, v. PUBLIC EMPLOYMENT RELATIONS COMMISSION and International Federation of Professional and Technical Engineers, Local 17, AFL-CIO, Petitioners.

No. 57935-1.

Supreme Court of Washington En Banc.

March 12, 1992.

Kenneth O. Eikenberry, Atty. Gen., Richard A. Heath, Sr. Asst., Olympia, for petitioner Public Employment Relations Com'n.

Richard D. Eadie, Edmonds, for petitioner International Federation of Professional and Technical Engineers.

Preston, Thorgrimson, Shidler, Gates & Ellis, J. Markham Marshall, Seattle, for respondent.

ANDERSEN, Justice.

FACTS OF CASE

The question raised by this appeal is whether the Public Employment Relations Commission (PERC) has authority to order "interest" arbitration as part of an unfair labor practice remedy. We hold that, in limited circumstances, it does.

The PERC order challenged in this action requires the employer, Municipality of Metropolitan Seattle (Metro), to participate in interest arbitration if collective bargaining between Metro and the International Federation of Professional and Technical Engineers, Local 17, AFL-CIO (Local 17) does not result in a collective bargaining agreement.

"Interest" (or contract) arbitration differs from the more familiar "grievance" arbitration. Grievance arbitration requires the employer and union to submit unresolved disputes regarding the interpretation or application of an existing collective bargaining contract to an objective arbitrator. ¹ Interest arbitration, on the other hand, occurs only at a point where an impasse has been reached in new contract negotiations. At that point, the unresolved items of the new collective bargaining agreement are submitted to an arbitrator who then decides the terms of the future collective bargaining contract. ²

This case concerns five employees who, until April 1984, worked as clerical employees for the City of Seattle's commuter pool. The city employees were represented by their exclusive bargaining agent, Local 17.

In 1982 or 1983, Metro, a public transit authority serving the greater Seattle area, began negotiating with the City of Seattle for a transfer of the City's commuter pool program to Metro. The plan involved the transfer of approximately 29 employees, including the five clerical employees who were members of Local 17. The statute authorizing such transfers ³ places certain obligations, including the duty to collectively bargain with existing unions, upon any metropolitan corporation which acquires an existing transportation system. ⁴ The statute provides:

If a metropolitan municipal corporation shall perform the metropolitan transportation function and shall acquire any existing transportation system, it shall assume and observe all existing labor contracts relating to such system and, to the extent necessary for operation of facilities, all of the employees of such acquired transportation system whose duties are necessary to operate efficiently the facilities acquired shall be appointed to comparable positions to those which they held at the time of such transfer, and no employee or retired or pensioned employee of such systems shall be placed in any worse position with respect to pension seniority, wages, sick leave, vacation or other benefits that he enjoyed as an employee of such system prior to such acquisition. The metropolitan municipal corporation shall engage in collective bargaining with the duly appointed representatives of any employee labor organization having existing contracts with the acquired transportation system and may enter into labor contracts with such employee labor organization.

(Italics ours.) RCW 35.58.265.

As evidenced by an internal staff proposal, Metro was well aware of this section of the law at least as early as April 1983, a full year before the actual transfer of the city employees occurred. In that staff proposal, Metro recognized that the five commuter pool employees belonged to Local 17, a union not otherwise involved with Metro. The staff proposal quotes from the above statute and then states: ⁵

Thus, those Commuter Pool employees would have the right to retain their union membership and have Metro engage in collective bargaining with their union representative. Hence, transfer of Commuter Pool to Metro would probably add another bargaining unit which Metro would have to work with and bargain with. This is not a major problem.

Metro staff does not see any substantial labor relations issues or concerns associated with the transfer of Commuter Pool. Effectuating the transfer will not adversely impact existing transit employees. Nor is there any provision in our existing transit collective bargaining agreements which would preclude or be impacted by the transfer. As noted earlier, several other transit organizations nationally are also involved in ridesharing activities without major labor relations implications.

The transfer agreement executed by the City of Seattle and Metro in April 1984 provided in part: ⁶

Metro shall succeed to the City's obligations under its collective bargaining agreement with ... Local 17 as to the represented employees transferred.

The five commuter pool employees were transferred to Metro in early April 1984. In the years from the date of that transfer to the present time, Metro has refused to recognize Local 17 as the appropriate bargaining unit for the transferred employees. During those years, Metro has also refused to bargain with the union, despite court and PERC orders to do so.

Two related actions preceded this one. In each action Metro's argument that it was not required to bargain with Local 17 was rejected.

In the first action, initiated in September 1984, Metro filed a unit clarification petition with PERC, asking PERC to find that the five transferred employees belonged to the bargaining unit represented by Local 587 of the Amalgamated Transit Union. Approximately 2,800 Metro workers were represented by Local 587. Although Local 587 was named as a party to the unit clarification case, it declined to actively participate in the proceeding and has never claimed to represent the five clerical employees. The executive director of PERC ruled against Metro ⁷ and dismissed the unit clarification petition, finding that Local 17 was the exclusive bargaining representative of the five commuter pool employees. The director found Metro advanced a "significantly different interpretation" of the law and the transfer agreement during the unit clarification action than it had in April of 1984, the date of the transfer, ⁸ and also found Metro's interpretation of the agreement "beyond credibility". ⁹

Metro appealed the ruling to the full Commission and the ruling was affirmed. ¹⁰ Metro then appealed PERC's decision to the Superior Court which, in turn, also affirmed PERC.

In the second action, Local 17 filed a complaint in the Superior Court for King County; it asked for an order requiring Metro to comply with the terms of the transfer agreement between it and the City. The trial court enjoined Metro from refusing to bargain with Local 17. The trial court also ordered Metro to pay Local 17's attorneys' fees in the amount of $30,202.50. The award of fees was based on a finding of bad faith on the part of Metro.

Both of these superior court decisions were appealed by Metro and in due course were affirmed by the Court of Appeals in an unpublished opinion. ¹¹

In February 1985 Local 17 filed the unfair labor practice complaint that resulted in the appeal before us. Local 17's complaint alleged a refusal to bargain on the part of Metro. Although the hearing on the unfair labor practice complaint was held in early November 1986, the decision was not issued until January 1988. ¹² The delay was due to PERC's decision to hold the matter in abeyance until a decision was reached by the King County Superior Court in Metro's unit clarification action. In the unfair labor practice case, Metro argued that it had changed its operations to such an extent that the commuter pool which was transferred from the City was no longer intact and thus no longer existed as a separate bargaining unit. The PERC hearing examiner found this argument to be "frivolous" in light of settled law requiring that the "effects" of such significant changes in working conditions must be bargained before being implemented. The hearing examiner noted that during the pendency of the action, and after the previous unit clarification petition had been dismissed, Metro had filed yet another petition with PERC asking that its bargaining obligations toward Local 17 be terminated. The hearing examiner found:

METRO has attempted at every turn to evade its bargaining obligations. It is evident that METRO has not given up the fight, and that it is still not prepared to fulfill its bargaining obligations towards Local 17.... METRO will likely continue to put up one defense after another in an ongoing attempt to defeat having a bargaining relationship with Local 17.

International Fed'n of Professional & Technical Eng'rs, Local 17 v. Municipality of Metro Seattle, Pub. Empl. Relations Comm'n Dec. 2845 PECB (1988), at 10-11.

The hearing examiner concluded:

METRO has asserted, and continues to assert, inherently frivolous defenses in an ongoing effort to subvert and avoid its bargaining obligations towards Local 17.

(Italics ours.) International Fed'n of Professional & Technical Eng'rs, Local 17 v. Municipality of Metro Seattle, Pub. Empl. Relations Comm'n Dec. 2845 PECB (1988), at 23.

The hearing examiner then crafted the order which is now before us on Metro's challenge. The order requires Metro to restore the status quo with respect to the five commuter pool employees and to make those employees whole. Based on a finding of bad faith on the part of Metro, it requires Metro to pay the union's reasonable attorneys' fees and costs. It orders Metro to post...