Orange Cnty. Water Dist. v. Pub. Emp't Relations Bd.

• Court: California Court of Appeals
• Writing for the Court: FYBEL, J.
• Citation: Orange Cnty. Water Dist. v. Pub. Emp't Relations Bd., 8 Cal.App.5th 52, 213 Cal.Rptr.3d 437 (Cal. App. 2017)
• Decision Date: 01 February 2017
• Docket Number: G052725
• Parties: ORANGE COUNTY WATER DISTRICT, Petitioner, v. PUBLIC EMPLOYMENT RELATIONS BOARD, Respondent; Orange County Water District Employees Association, Real Party in Interest.

8 Cal.App.5th 52

213 Cal.Rptr.3d 437

ORANGE COUNTY WATER DISTRICT, Petitioner,

v.PUBLIC EMPLOYMENT RELATIONS BOARD, Respondent;

Orange County Water District Employees Association, Real Party in Interest.

G052725

Court of Appeal, Fourth District, Division 3, California.

Filed February 1, 2017

Rutan & Tucker, George W. Shaeffer, Jr., and Joel D. Kuperberg, Costa Mesa, for Petitioner.

J. Felix De La Torre, General Counsel, Wendi L. Ross, Deputy General Counsel, and Daniel M. Trump, Regional Attorney, for Respondent.

Donald L. Drozd for Real Party in Interest.

OPINION

FYBEL, J.

INTRODUCTION

The Public Employment Relations Board (the Board or PERB) concluded the Orange County Water District (the District) committed an unfair practice, in violation of Government Code section 3502.5, when it refused to consent to an election petitioned for by the recognized employee organization seeking to implement a so-called modified agency shop. (All further statutory references are to the Government Code unless otherwise specified.) An agency shop is defined in section 3502.5, subdivision (a) as an arrangement that requires an employee, as a condition of continued employment, to either join the recognized employee organization or pay the organization a service fee. The proposed agency shop in this case is referred to as a "modified" agency shop because it would apply only to future employees hired into the bargaining unit and not apply to current employees. The District filed a petition for a writ of extraordinary relief from the Board's decision under section 3509.5, subdivision (a). We granted a writ of review.

We deny the petition for extraordinary relief. For the reasons we explain post , we hold that section 3502.5 authorizes the proposed modified agency shop.

STIPULATED FACTS¹ AND PROCEDURAL HISTORY

The District is a public agency within the meaning of section 3501, subdivision (c), and is therefore subject to the provisions of the Meyers-Milias-Brown Act (MMBA), section 3500 et seq. The Orange County Water District Employees Association and the Orange County Employees Association (collectively referred to as the Association) constitute an employee organization within the meaning of section 3501, subdivision (a). The Association is a recognized employee organization within the meaning of section 3501, subdivision (b), which has been formally acknowledged by the District as an employee organization that represents employees of the District. The Association does not represent employees who have been designated by the District as management and confidential employees of the District within the meaning of section 3507.5.

Since June 24, 2005, the District and the Association have been parties to a memorandum of understanding (MOU) and successor MOU's, which have set forth various wages, hours, and other terms and conditions of employment for the employees in the bargaining unit covered by the MOU.² "At all times herein relevant," the total number of employees in the bargaining unit represented by the Association was 184, of which 126 employees were dues paying members of the Association.

In May 2011, in the course of negotiations for a successor MOU, the Association proposed a "modified" agency shop arrangement which would apply only to new employees of the District, hired on or after a set future date, and not apply to then current employees. The District rejected the Association's proposed modified agency shop arrangement on the ground that section 3502.5 does not authorize the creation of such an arrangement.

In July 2012, the Association requested that the MOU be reopened to implement the proposed modified agency shop arrangement. The District rejected the Association's request on the same ground.

On November 14, 2012, the Association served the District and the State Mediation and Conciliation Service (SMCS) with a petition and request for an agency shop election, which stated, in part, that no management or confidential employees were included in the unit, and the petition had been signed by approximately 98 percent of the members of the unit.

The Association's petition contained the signatures of 125 employees of the District, who belonged to the bargaining unit. The petition stated: "We, the undersigned employees of the Orange County Water District represented by the Orange County Employees Association, hereby request a Modified Agency Shop Agreement and an election to implement an Agency Fee Arrangement pursuant to California Government Code section 3502.5 and other applicable laws or regulations. Pursuant to [the] Modified Agency Shop Agreement and Arrangement, all employees hired on or after March 1, 2013, will be required to join as members the Orange County Employees Association or pay to the Orange County Employees Association a ‘service fee’ as set forth in Government Code section 3502.5(a), et seq. All employees hired prior to March 1, 2013 are specifically excluded from the Modified Agency Shop Agreement and Arrangement."

On December 4, 2012, the District's director of human resources, Stephanie Dosier, received an e-mail from SMCS mediator Jerry Fecher, in which Fecher confirmed receipt of the Association's request for an agency shop election. Fecher requested that a meeting be scheduled to discuss the logistics for setting up an election; he proposed December 12 and 14, 2012, as possible dates for such a meeting.

On December 7, the District's legal counsel responded to Fecher by requesting a postponement of the meeting "until SMCS verified its ability to conduct a modified agency shop election under Government Code section 3502.5(a)." On December 12, Fecher responded to that communication by stating the MMBA does not authorize SMCS to rule on the legality of a proposed agency fee arrangement and further stating, "if the parties are ready and in agreement to proceed, SMCS is available, if necessary, to check the level of support in the petition and/or to subsequent[ly] conduct an election."

After receiving further direction from the District's governing board, on January 3, 2013, the District's legal counsel informed Fecher that the District would not voluntarily consent to a modified agency shop election "which has the intention of creating an agency shop only for employees hired on or after March 1, 2013, and which exempts all current bargaining unit employees." The District reconfirmed its position that an agency shop arrangement must apply to all employees in the unit and therefore cannot be limited to employees hired after a future date.

On July 3, 2013, the Association timely filed an unfair practice charge based on the District's denial of the Association's petition for a modified agency shop election as a violation of section 3502.5. The Association stated it sought "administrative relief by requiring the District to agree to conduct an election pursuant to the petitions signed by significantly more tha[n] the requisite 30% of the eligible members." The Board issued a complaint.

An unfair practice hearing was conducted before an administrative law judge. The parties had filed a stipulated factual record and opening briefs which resulted in the hearing consisting of oral argument. The administrative law judge observed, "the issue presented in this case may be one of first impression for PERB or is likely one of first impression for PERB." The administrative law judge's proposed decision, issued on February 26, 2015, concluded that the District had violated section 3502.5 because it refused to participate in a properly petitioned-for agency shop election. The administrative law judge's proposed decision further concluded that the District had failed to assert a valid defense.

The District timely filed a statement of exceptions, and the Association timely filed a response. The Board reviewed the hearing record in its entirety and concluded the administrative law judge's proposed decision was adequately supported by the evidentiary record, well reasoned, and consistent with all relevant legal principles. The Board found no merit in the District's exceptions and "adopt[ed] the proposed decision, including its procedural history, statement of jurisdiction, findings of fact, identification of issue, conclusions of law, remedy, proposed order and Notice, as the decision of the Board itself as supplemented by a discussion of the District's exceptions."

On October 22, 2015, the District timely filed a "petition for a writ of extraordinary relief" under section 3509.5, subdivision (b) from the Board's decision. This court granted the District leave to file an amended petition on October 28 (the petition).³ Following full briefing by the parties, this court issued a writ of review.

REQUEST FOR JUDICIAL NOTICE

The District has filed a request that we take judicial notice of numerous documents. As pointed out in the petition, the District had previously requested that the administrative law judge and the Board each take judicial notice of the same documents, which are all included in the administrative record before this court. The District's request was granted by both the administrative law judge and the Board. Given that all the documents at issue were judicially noticed below and are in our record, we deny the District's request for judicial notice filed in this court as superfluous and moot.

DISCUSSION

I.

THE MMBA AND PERB

"The National Labor Relations Act (NLRA; 29 U.S.C. § 151 et seq. ) governs collective bargaining in private sector employment. [Citations.]

However, the NLRA leaves states free to regulate labor relationships with their public employees. [Citations.] [¶] Public employees in California do not have the right to bargain collectively absent enabling legislation. [Citation.] Rather than fashion a single overarching employment relations law, like the NLRA, our Legislature has passed several different statutes covering specific categories of public employees. [Citation.] In 1968, the Legislature enacted the MMBA,...