BILL ANALYSIS Ó
SENATE JUDICIARY COMMITTEE
Senator Noreen Evans, Chair
2011-2012 Regular Session
SB 857 (Lieu)
As Amended April 25, 2011
Hearing Date: May 10, 2011
Fiscal: No
Urgency: No
TW
SUBJECT
Civil Damages
DESCRIPTION
This bill would prohibit an employer's recovery of damages
resulting from expenses incurred in anticipation of, or in
preparation for, an employee strike. Accordingly, this bill
would overturn the ruling in California Nurses Association v.
Regents of the University of California (2010) PERB Decision No.
2094-H.
BACKGROUND
The Public Employment Relations Board (PERB) is a quasi-judicial
agency which oversees public sector collective bargaining in
California. Under this authority, PERB administers collective
bargaining statutes, ensures their consistent implementation and
application, and adjudicates disputes between the parties
subject to them. PERB oversees collective bargaining issues
under the Educational Employment Relations Act of 1976 (EERA),
the State Employer-Employee Relations Act of 1978, known as the
Ralph C. Dills Act (Dills Act), and the Higher Education
Employer-Employee Relations Act of 1979 (HEERA).
The Meyers-Milias-Brown Act of 1968 (MMBA), which affects local
government employees, was brought under PERB's jurisdiction in
2000 (SB 739 (Solis, Ch. 901, Stats. 2000)), and in 2004, PERB's
jurisdiction was expanded over the Trial Court Employment
Protection and Governance Act and the Trial Court Interpreter
Employment and Labor Relations Act (SB 1102 (Committee on Budget
and Fiscal Review, Ch. 227, Stats. 2004)). PERB also is
(more)
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responsible for the administration of the Los Angeles County
Metropolitan Transportation Authority Transit Employer-Employee
Relations Act (TEERA).
This bill was prompted by a recent PERB decision wherein PERB
held that employers could recover the costs of an unlawful
strike, including damages incurred as a result of the strike
threat and preparations therefor. In that case, California
Nurses Association v. Regents of the University of California
(2010) PERB Decision No. 2094-H, PERB found that the failure by
the California Nurses Association to conform to the exhaustion
requirements under the HEERA was a violation of HEERA, and PERB
awarded damages to the University of California (UC) for costs
incurred in preparation of the one-day strike.
This bill, sponsored by University of California Employees,
American Federation of State, County and Municipal Employees
Local 3299 (AFSCME), AFL-CIO, would prohibit an award to an
employer of damages relating to expenses incurred in
anticipation of, or in preparation for, an employee strike.
CHANGES TO EXISTING LAW
Existing law , the Meyers-Milias-Brown Act of 1968 (MMBA),
permits local governments, including cities, counties, and
special districts, to establish administrative procedures for
employee representation and collective bargaining agreements.
(Gov. Code Sec. 3500 et seq.) Existing law permits the PERB to
resolve labor disputes under the MMBA and provides PERB with
exclusive jurisdiction over a complaint alleging any violation
of the MMBA. (Gov. Code Sec. 3509.) PERB's jurisdiction over
the MMBA excludes peace officers, management employees and the
City and County of Los Angeles. (Gov. Code Sec. 3541 et seq.)
Existing law , the Educational Employment Relations Act of 1976
(EERA), provides for collective bargaining in California's
public schools (K-12) and community colleges. (Gov. Code Sec.
3540 et seq.) Existing law permits the PERB to resolve labor
disputes under the EERA. (Gov. Code Sec. 3541.)
Existing law , the State Employer-Employee Relations Act of 1978,
known as the Ralph C. Dills Act (Dills Act), provides for
collective bargaining for state government employees. (Gov.
Code Sec. 3512 et seq.) PERB has the same authority to enforce
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the Dills Act as it does under the EERA. (Gov. Code Sec.
3514(h).)
Existing law , the Higher Education Employer-Employee Relations
Act of 1979 (HEERA), provides for collective bargaining for
employees of the California State University System, the
University of California System, and Hastings College of Law.
(Gov. Code Sec. 3560 et seq.) Existing law permits PERB to
resolve labor disputes under the HEERA and provides PERB with
exclusive jurisdiction over a complaint alleging any violation
of the HEERA. (Gov. Code Secs. 3563 and 3563.2.)
Existing law , the Trial Court Employment Protection and
Governance Act and the Trial Court Interpreter Employment and
Labor Relations Act, provide for collective bargaining for trial
court employees and court interpreters. (Gov. Code Secs. 71600
and 71800.) Existing law provides PERB with the same authority
to enforce these Acts as it does under HEERA and provides PERB
with exclusive jurisdiction over a complaint alleging any
violation of these Acts. (Gov. Code Secs. 71639.1 and 71825.)
This bill would prohibit recovery of damages resulting from
expenses incurred by an employer in anticipation of, or in
preparation for, an unlawful strike.
This bill would define "unlawful strike" to mean any strike that
has been determined unlawful by PERB.
COMMENT
1. Stated need for the bill
The author writes:
In February of 2010, PERB was hearing an unfair labor practice
case between the University of California system and the
California Nurses Association. Largely made up of
Schwarzenegger appointees, the Board created out of
whole-cloth a right which had previously not existed: strike
damages due to the threat of a strike. ÝEmphasis in
original.]
In response to this, both the Assembly and Senate Chairs at
the time challenged the right of PERB to levy strike damages
in this case; PERB was ultimately unresponsive. To date,
appellate courts have declined to hear the appeal on the PERB
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decision as well. The author and the sponsor believe that this
decision is a derivation from the traditional scope of PERB's
powers and rights, and therefore requires a legislative
response.
The University of California Employees, American Federation of
State, County and Municipal Employees Local 3299 (AFSCME),
AFL-CIO, the sponsor of this bill, writes:
This bill is necessary to protect the right of public
employees to strike. . . . SB 857 would protect unions from
union-busting tactics. Specifically, it would protect them
from having an injunction filed by the employer with ÝPERB]
after notice is given of a strike, followed by the employer
claiming exorbitant damages for a strike that never took
place. The restrictions put in place by SB 857 would prevent
this from happening.
The California Nurses Association (CNA), a supporter of this
bill and plaintiff in the case at issue, writes:
CNA strongly supports ÝSB] 857 because of our contentious
labor relations with the UC ÝUniversity of California] since
having a 2005 strike enjoined and the fact that the UC has
spent over $3.5 million on a notorious union-busting law firm
. . . Ýwhich] is being used in efforts to strip workers of
fundamental rights and/or to shackle unions with costly and
time-consuming litigation when workers exercise these rights.
In 2005, UC nurses planned to strike over UC's failure to
bargain in good faith over CNA's proposals for safe staffing
to provide and protect patient care in the UC Medical Centers.
. . . Later that year the contract was settled. Nevertheless,
UC pursued charges against CNA, and have claimed $9 million in
damages.
2. Prohibiting an award of strike damages
This bill would prohibit the award of damages resulting from
expenses incurred by an employer in anticipation of or in
preparation for an unlawful strike. Existing law provides PERB
with authority to resolve labor disputes regarding collective
bargaining agreements and enforce the various collective
bargaining statutes.
Recently, PERB held that it also had the authority to award
restitutive damages to an employer which suffered pre-strike
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preparation damages. (See California Nurses Association v.
Regents of the University of California (2010) PERB Decision No.
2094-H.) PERB found that the failure by CNA to conform to the
exhaustion requirements under the HEERA was a violation of
HEERA, and PERB awarded damages to UC for costs incurred in
preparation of the one-day strike.
CNA argued against PERB's authority to award damages because, in
City and County of San Francisco v. United Assn. of Journeymen,
etc. (1986) 42 Cal.3d 810, the court held that
Ýt]here remain today relatively few cases in which the
imposition of a judicial remedy of tort damages would not
impinge directly upon an established administrative mechanism
for resolving disputes between a public employer and its
employees. The possible scope of a damage remedy has been so
greatly narrowed that one senses that it would be
fundamentally unfair to hold a few public employee unions
liable for damage awards when teachers' unions, state employee
unions, and many local employee unions would not be liable for
the same conduct. (Id. at pg. 816.)
Accordingly, CNA argued, it was improper to award damages
against the nurses association when other state unions would not
be liable for the same conduct.
However, PERB reasoned that it in fact had the power to award
strike damages because no Supreme Court decision had held "that
PERB has no authority to award damages to make an employer whole
for unlawful strike activity. Consequently, these decisions
simply say that it is for PERB, not the courts, to decide in the
first instance whether a monetary make whole remedy would
effectuate the purposes of the applicable collective bargaining
state on the facts of each case." (Cal. Nurses Assn. v. Regents
of the Univ. of Cal. (2010), supra, at pg. 41.) This bill would
overturn PERB's decision to award restitutive damages to the
employer for costs incurred in anticipation of or in preparation
for an unlawful strike.
Stakeholder groups, including the UC, are concerned that this
bill would limit the employer's ability to recover strike
damages resulting from tortious activities conducted by the
employees. Incidentally, this argument was discussed by PERB in
the Cal. Nurses Assn. case. PERB reasoned that the City and
County of San Francisco v. United Assn. of Journeymen etc. of
United States & Canada (1986) 42 Cal.3d 810 "recognized that
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some types of strike damages fall outside the purview of
collective bargaining and thus may be awarded by the courts,
such as damages for 'tortious acts occurring during the conduct
of a strike,' e.g. personal injury or property damage, or
damages for breach of a contractual 'no strike' clause." (Cal.
Nurses Assn. v. Regents of the Univ. of Cal. (2010), supra, at
pg. 40.) However, this bill would not prohibit damages for
tortious acts during the conduct of a strike or damages for
breach of a contractual 'no strike' clause. Rather, this bill
would provide that no damages could be awarded for expenses
incurred by the employer in anticipation of or in preparation
for a strike.
Support : California Labor Federation, ALF-CIO; California
Nurses Association
Opposition : None Known
HISTORY
Source : University of California Employees, American Federation
of State, County and Municipal Employees Local 3299, AFL-CIO
Related Pending Legislation : AB 1318 (Davis), as with this
bill, would prohibit the award of damages due to an unlawful
strike, but, in addition to prohibiting the recovery of expenses
incurred in anticipation of or in preparation for the strike, AB
1318 would also prohibit the recovery of damages resulting from
revenue losses caused by the strike. AB 1318 is in the Assembly
Committee on Judiciary.
Prior Legislation : See Background.
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