UE Local 893/IUP v. State

• Docket Number: 22-0790
• Decision Date: 27 October 2023
• Parties: UE Local 893/IUP, Appellee/Cross-Appellant, v. State of Iowa, Appellant/Cross Appellee.
• Court: Iowa Supreme Court

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UE Local 893/IUP, Appellee/Cross-Appellant, v. State of Iowa, Appellant/Cross Appellee.

No. 22-0790

Supreme Court of Iowa

October 27, 2023

Submitted September 13, 2023

Appeal from the Iowa District Court for Polk County, Paul D. Scott Judge.

An employer appeals a finding that it breached certain collective bargaining agreements and an award of damages to a union.The union crossappeals the denial of its attorney fees claim.Affirmed.

Brenna Bird, Attorney General; Jeffrey S. Thompson, Solicitor General; and Job Mukkada (argued), Tessa M. Register, and Emily Willits(until withdrawal), Assistant Attorneys General, for appellant/cross-appellee.

Charles Gribble(argued), Christopher Stewart, and Carly Scott(until withdrawal) of Gribble Boles Stewart &Witosky Law, Des Moines, for appellee/cross-appellant.

May J., delivered the opinion of the court, in which all justices joined.

OPINION

May, Justice.

A labor union sued an employer because the employer refused to collect dues from union members' paychecks.At summary judgment, the district court ruled that the employer's refusal to collect dues was a breach of certain collective bargaining contracts.After trial, the district court awarded money damages to the union.But the district court declined the union's request for attorney fees.Now the employer appeals and the union cross-appeals.Their appeals raise four questions:

1.Did the district court err by concluding that the employer breached the contracts?

2.Did the district court err by awarding money damages to the union?

3.Was there insufficient evidence to support the district court's conclusion that the union adequately mitigated damages?

4.Was the district court wrong to deny the union's request for attorney fees?

We answer all four questions in the negative.We affirm.

I.Factual Background.

A.The Parties and Their History.

As mentioned, this case involves a dispute between a union and an employer.The union is UE Local 893/IUP, which we refer to as "UE."The employer is the State of Iowa.

The dispute involves two bargaining units.One unit is made up of science workers.The other unit is made up of social services workers.Both units are represented by UE.

For each of these units, UE and the State have entered a long series of collective bargaining contracts over the past few decades.More particularly, UE and the State have entered a new two-year agreement for each unit every two years.The last "noncontentious" contracts (so to speak) were in effect from July 1, 2015, through June 30, 2017.We refer to them as the "2015-2017 contracts."

B. UE and the State Negotiate for the 2017-2019 Contracts.

In May 2016, while the 2015-2017 contracts were still in effect, UE and the State agreed to a schedule for negotiating the next set of contracts.Like prior contracts, this next set of contracts would be effective for another two-year period.Specifically, they would be effective from July 1, 2017, through June 30, 2019.We refer to them as the "2017-2019 contracts."

On December 6, 2016, UE presented its initial offer for the 2017-2019 contracts to the State.On December 20, the State responded with its initial offer.Each side's offer requested a few new terms.But as to most issues, including the issue of dues collections, both the State and UE asked for the 2017-2019 contracts to contain the same terms as the 2015-2017 contracts.

On January 10, 2017, UE and the State met for a negotiating session.At this session, neither UE nor the State deviated from its initial offer.It appears that the State was waiting to see whether the legislative session would bring changes to Iowa's collective bargaining laws.UE and the State canceled the additional bargaining sessions scheduled for later in January.

Meanwhile, lawmakers were indeed considering collective bargaining.On February 9, House File 291 was introduced in the Iowa House of Representatives.See generally2017 Iowa Actsch. 2(codified in scattered chapters of Iowa Code(2018)).Upon enactment, House File 291 would bring substantial changes to Iowa's public employee collective bargaining law.See, e.g., id.§§ 6, 22(codified at Iowa Code § 20.9(2018);id.§ 70A.19).Important here, House File 291 would exclude dues checkoffs from the scope of negotiations.Id.§ 6(codified at Iowa Code § 20.9(2018)).House File 291 would also prohibit the State from deducting dues from employees' paychecks.Id.§ 22(codified at Iowa Code § 70A.19(2018)).But these prohibitions would not apply to collective bargaining agreements ratified before House File 291's effective date.Id.§ 27.

House File 291 was signed by the Governor on February 17.And House File 291 took effect on February 17.Seeid.§§ 26, 48, 53, 64, 67.But before House File 291 was signed or could take effect, UE took action of its own.On February 10, UE sent a letter to the State.This letter explained that UE's negotiation committee had voted to accept the State's December 20 offer.

Then UE got its members involved.On February 14, UE's members voted unanimously to ratify the State's offer of December 20, 2016.The next day, UE notified the State of the ratification vote.But the State did not acknowledge that new contracts had been formed.

C. UE Files the First Suit.

So then, on February 21, 2017, UE filed a petition against the State in district court.UE asked the court to declare that, indeed, new contracts for 2017-2019 had been formed and were enforceable.

D.The State Still Performs the 2015-2017 Contracts.

Meanwhile, and despite the disagreement about the 2017-2019 contracts, the State continued to perform the 2015-2017 contracts.The State's performance included collecting dues from union members who had submitted authorizations.This collection of dues was required by the written terms of the 2015-2017 contracts.Here is a relevant excerpt:

ARTICLE II

RECOGNITION &UNION SECURITY

....

SECTION 2 Dues and Fees Deductions A.Upon receipt of a voluntary individual written request from any of its employees covered by this Agreement on forms provided by [UE], the [State] will deduct from the pay due such employee those dues required as the employee's membership dues in [UE], and fees for [UE-]sponsored credit union and insurance programs.

(Emphasis omitted.)

E.Later, the State Stops Collecting Dues.

By their terms, the 20152017 contracts expired on June 30, 2017.And in June 2017, the State continued to dispute that any new 2017-2019 contracts had been formed.Also, it appears the State was worried that if new 2017-2019 contracts had not been formed, the State's continued collection of dues could be unlawful under House File 291.As of June 2017, though, no court had determined whether new 20172019 contracts had been formed.That is apparently why the State stopped collecting dues in June 2017.

F.Judgment for UE in the First Suit.

A few months later, in November 2017, the district court ruled on pending summary judgment motions in the first suit.The court granted summary judgment in favor of UE and against the State.The court declared that the 2017-2019 contracts "accepted by [UE] and ratified by its members [are] valid and enforceable on the terms agreed to."And the court directed UE and the State"to perform as required under" the 2017-2019 contracts.

G.The State Appeals and Seeks a Stay.

The district court's ruling was timely appealed by the State.The State also asked this court to stay the district court's ruling while the appeal proceeded.A justice of this court denied the State's motion.Then the State asked for three-justice review.A three-justice panel denied the State's request for a stay on February 22, 2018.

H.The State's Performance of the 2017-2019 Contracts.

After the three-justice order was issued, the State began to implement some requirements of the 2017-2019 agreements.The State did not, however, resume collecting dues.

As to the dues issue, the State explained its position in a letter to UE dated March 9, 2018.The March 9 letter advised UE that before the State would reinstate dues collection "on a go-forward basis,"the State would need to receive "a current written authorization" from each employee.The letter also addressed "retroactive collection of dues" from "July 1, 2017[,] to date."The State offered to collect those dues if three conditions were met.First, the employees must sign new written authorizations.Second, UE must agree to "indemnif[y] . . . the State . . . for any and all claims, including but not limited to claims filed by individual employees, arising from the retroactive collection of dues."Finally, UE must "release[]the State from any claim [that][UE] may assert related to the State not collecting dues between July 1, 2017[,] and the date dues deductions are reinstated."

I. UE Responds to the State's Refusal to Collect Dues.

UE did not agree to the demands contained in the State's letter.Nor did UE otherwise try to obtain new dues deduction authorizations from its members.UE believed it was not obligated to do so.

But UE did make extensive efforts to obtain dues directly from its members.Those efforts included, among other things, working with third-party vendors to smooth the process.Through these efforts, UE collected over $350,000 from members.

J.This Court Resolves the First Appeal in UE's Favor.

Meanwhile the appeal in UE's first suit continued to progress.In May 2019, this court issued its opinion.UE Loc. 893/IUP v. State, 928 N.W.2d 51(Iowa2019).We concluded that the State's December 20, 2016 offer had not been withdrawn when UE's members voted to ratify its terms on February 14, 2017.Id. at 56-57, 69.And so we affirmed the district court's...