BILL ANALYSIS Ó
AB 537
Page 1
ASSEMBLY THIRD READING
AB 537 (Bonta)
As Amended April 17, 2013
Majority vote
PUBLIC EMPLOYEES 5-2 APPROPRIATIONS 12-5
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|Ayes:|Bonta, Jones-Sawyer, |Ayes:|Gatto, Bocanegra, |
| |Mullin, Rendon, | |Bradford, |
| |Wieckowski | |Ian Calderon, Campos, |
| | | |Eggman, Gomez, Hall, |
| | | |Ammiano, Pan, Quirk, |
| | | |Weber |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Allen, Harkey |Nays:|Harkey, Bigelow, |
| | | |Donnelly, Linder, Wagner |
| | | | |
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SUMMARY : Makes various changes to the Meyers-Milias-Brown Act
(MMBA) governing local public employer and employee relations
related to arbitration agreements, mediation, ground rules,
contract ratification, and employee relations ordinances.
Specifically, this bill :
1)Prohibits a public agency from establishing ground rules for
the meet and confer process that limit the right of an
employee or employee organization to communicate with
officials of the public agency.
2)Requires that if an agreement is reached between the public
agency and the recognized employee organization, an memorandum
of understanding (MOU) will jointly be prepared and will
become binding upon execution or ratification, as specified.
3)Authorizes either party to be able to request mediation if
they fail to reach agreement, requires that the parties agree
upon the appointment of a mediator within five days of the
request, and specifies that if the parties fail to agree on
the appointment of a mediator, either party may request the
Public Employment Relations Board (PERB) appoint a mediator.
PERB is required to appoint the mediator within five days of
receiving the request.
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4)Specifies that an arbitration agreement contained in a MOU is
enforceable, as specified, prohibits assertions of failing to
satisfy procedural requirements from being a basis for
refusing to submit the dispute to arbitration, and prohibits a
court from refusing to order arbitration because the issue
could also constitute an unfair labor practice under the
jurisdiction of PERB.
5)Requires a public agency to engage in the meet and confer
process before adopting reasonable rules and regulations
governing the administration of employer-employee relations
and specifies that disputes arising under this provision will
be resolved pursuant to the factfinding procedures of the
MMBA.
6)Provides that if the Commission on State Mandates determines
that this bill contains costs mandated by the state,
reimbursement to local agencies and school districts for those
costs shall be made pursuant to current law governing state
mandated local costs.
EXISTING LAW as established by the MMBA:
1)Contains various provisions intended to promote full
communication between public employers and their employees by
providing a reasonable method of resolving disputes regarding
wages, hours, and other terms and conditions of employment
between public employers and public employee organizations.
2)Requires a public agency to meet and confer in good faith with
the representatives of a recognized employee organization
regarding wages, hours, and other terms and conditions of
employment
3)Provides that if, after a reasonable amount of time,
representatives of the public agency and the employee
organization fail to reach agreement, the two parties may
mutually agree on the appointment of a mediator and equally
share the cost.
4)Provides that an agreement which the negotiators for a public
agency and a recognized employee organization reach shall not
be final and binding upon the parties to the negotiations
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until it is presented to the public agency's governing body or
statutory representative for determination.
5)Authorizes an employee organization to request that the
parties' differences be submitted to a factfinding panel not
sooner than 30 days, but not more than 45 days, following the
appointment of a mediator or entering into a mediation
process. If the dispute was not submitted to mediation, an
employee organization may request that the parties'
differences be submitted to a factfinding panel not later than
30 days following the date either party provided the other
with written notice of a declaration of impasse.
6)Allows an employer to implement their last, best and final
offer once any applicable mediation and fact-finding
procedures have been exhausted and, despite the implementation
of the best and final offer, allows a recognized employee
organization the right each year to meet and confer.
7)Authorizes a local public agency to adopt reasonable rules and
regulations after consultation in good faith with
representatives of an employee organization or organizations
for the administration of employer-employee relations under
the MMBA.
8)Delegates jurisdiction over the employer-employee relationship
to PERB and charges PERB with resolving disputes and enforcing
the statutory duties and rights of local public agency
employers and employee organizations.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)Based on the staffing that PERB estimated was necessary to
administer the bill, the fiscal impact of administering the
provisions of this bill is approximately $750,000.
2)This bill is keyed a local mandate and there could be
substantial state mandated reimbursement of local costs. The
amount would depend on the number of requests for arbitration
and mediation. Reimbursable costs could be in the millions of
dollars. The Commission on State Mandates has approved a test
claim for any local government subject to the jurisdiction of
PERB that incurs increased costs as a result of a mandate,
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meaning their costs are eligible for reimbursement. There are
several thousand local governments, many with dozens of
bargaining units that would be subject to the bill.
COMMENTS : The following information was provided to the
Assembly Public Employees, Retirement and Social Security
Committee by the author and the sponsors of the bill:
1)Collective bargaining is a process of negotiations between
employers and a group of employees aimed at reaching
agreements that regulate working conditions. This process
includes the determination of how the parties will negotiate,
which often includes the establishment of "ground rules" prior
to engaging in the formal negotiation process. Such ground
rules often include time and place and parties participating
in the negotiations as well as procedures for caucuses,
exchanging proposals, agreement or how to determine when the
parties have reached impasse.
Over the last several years, some local government employers
have attempted to frustrate and disrupt this bargaining
process by insisting upon agreement of a 'ground rule' or the
imposition of a 'negotiations or bargaining policy' that
limits the right of an employee organization or the employees
of the agency to communicate with officials of the public
agency - effectively imposing a gag order on the employee
representatives. This attempt to unduly constrict an employee
organization's access to publicly elected officials in order
to blunt full communication on the issues compromises a
healthy collective bargaining relationship and upsets the goal
of collectively reaching an agreement to the benefit of all
parties to the negotiation.
The bill adds a provision to current law affirming an employee
organization's right to communicate with officials of the
public agency just as their management partners are permitted
to do during the course of negotiations.
2)The statute currently provides that an agreement which the
negotiators for a public agency and a recognized employee
organization reach shall not be final and binding upon the
parties to the negotiations until it is presented to the
public agency's governing body or statutory representative for
determination.
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Unfortunately, too many governing bodies of public agencies
reject a tentative agreement out-of-hand after the parties'
negotiators have expended considerable time and resources to
arrive at that agreement, and the employee organization has
often already conducted a ratification vote among its members.
Employee organizations report that this delays or thwarts the
bargaining process; if the employee organization's members
ratify the tentative agreement, the employee organization is
bound to it, yet the public agency's governing body is free to
reject it. This provision is consistent with the requirement
that negotiators possess sufficient authority to bind their
principals to an agreement.
This bill would specify that an agreement which the negotiators
for a public agency and a recognized employee organization
reach shall be final and binding upon the parties to the
negotiations when the agreement is signed by both parties, or
if the recognized employee organization's internal rules
require ratification then upon such ratification.
3)Mediation is a form of alternative dispute resolution, a way
of resolving disputes between two or more parties with
concrete effects. Typically, a third party, the mediator
assists the parties to negotiate a settlement. Mediators are
often helpful in narrowing the issues of disagreement or
helping to sort out the accuracy of data, labor market
comparisons, fiscal statements, or other information which may
assist the parties in reaching an agreement. Moreover,
mediators are often helpful in framing bargaining approaches
consistent with bargaining history and relevant public
concerns.
Under current California law, mediation is mandatory if
requested by either party with respect to employees governed
by the Educational Employment Relations Act, the Dills Act,
and the Higher Education Employer-Employee Relations Act.
Local public employees and their employers are often denied the
assistance and expertise of a mediator who can help overcome
the intransigence of either party. Given the current law
requirement that both parties have to agree to proceed to
mediation, the obstructionist party will continue to employ
tactics to reject compromise or rush to impasse, blocking the
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other party's attempt to request mediation to resolve their
differences.
By conforming the mediation provisions of the MMBA to the
aforementioned employee relations acts, the parties will
remain at the bargaining table with the assistance of a
mediator up to the invocation of the impasse procedure of
fact-finding or binding interest arbitration, if applicable.
By amending the statute to require mediation if requested by
either party, firefighter, social workers, and other local
government employees will have available the assistance of
third party mediators to help reach agreements, or at least
avoid the indiscriminate imposition of last, best and final
employer offers.
Likewise, employers would reap the benefits of access to a
mediator to aid the parties in reaching agreement where the
employee organization may fail to recognize that the labor
market doesn't support the contract demands, their fiscal
analysis is flawed, or other realities that may affect a
successful settlement. An effective mediator tells the truth
to the parties and asks them to consider the options,
including the fallout from failure to reach agreement.
4)Arbitration agreements are a common feature of memoranda of
understanding negotiated and entered into under MMBA. The
Supreme Court has held that arbitration decisions issued under
such agreements are binding and entitled to judicial
enforcement. See Taylor v. Crane, 24 Cal.3d 442, 450-51
(1979). As currently drafted, however, the MMBA is silent as
to the standards and procedures for enforcing arbitration
agreements. This bill will clarify the law regarding
arbitration agreements in three respects.
First, the bill will make it clear that the provisions of the
California Arbitration Act, apply to the enforcement of
arbitration agreements under the MMBA. While this generally
has been assumed to be the true, some courts have viewed a
writ of mandate as the appropriate vehicle for enforcing an
arbitration agreement. By adding a specific reference to the
California Arbitration Act, the bill will eliminate any
confusion as to the appropriate procedure for compelling
arbitration.
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Second, the bill will make it clear that procedural defenses to
an arbitration claim - such as the contention that the claim
was untimely or that the party seeking arbitration failed to
exhaust pre-arbitration remedies - will not be a basis for
refusing to arbitrate and will be submitted to the arbitrator
for resolution. This is a codification of the longstanding
rule under federal law--the Labor Management Relations Act--as
interpreted by the U.S. Supreme Court in John Wiley & Sons v.
Livingston, 376 U.S. 543, 557 (1964). The intent of the rule
is to strengthen arbitration and to prevent needless
litigation over garden variety procedural defenses.
Third, the bill will make it clear that an agreement to
arbitrate a dispute is enforceable, even where the conduct in
question may also constitute an unfair labor practice that
could be brought in an administrative proceeding before PERB.
Again, this is consistent with federal labor law, which has
long recognized that the arbitrator and the labor board may
exercise concurrent jurisdictions in such situations.
5)Statute currently provides that a public agency may adopt
reasonable rules and regulations governing the administration
of employer-employee relations after "consultation" in good
faith with the recognized employee organization(s).
Regrettably, the statute's existing term "consultation" has
generated confusion and disagreement among public agencies and
recognized employee organizations regarding the nature of a
public agency's bargaining obligation.
Employee organizations have reported that some public agencies
merely meet and discuss proposed rules and regulations with
the recognized employee organization(s), and rush to implement
the changes without having obtained much (or any) input from
the recognized employee organization(s). Existing law must be
clarified so that public agencies are required to a meet and
confer obligation consistent with the stated purpose and
intent of the MMBA, in which the parties have an opportunity
for full communication regarding these matters.
Full communication is absolutely critically considering that the
rules and regulations to be adopted will govern
employer-employee relations. As such, it is particularly
important that recognized employee organizations understand
the public agencies' proposals and have the opportunity to
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present information, comments and counterproposals. This will
increase the likelihood that the parties will have a mutual
understanding regarding, and comply with, the rules and
regulations in the future.
This bill would clarify that a public agency must meet and
confer in good faith with recognized employee organization(s)
before adopting reasonable rules and regulations governing the
administration of employer-employee relations. The amendment
also specifies that disputes arising under the section are
subject to factfinding is consistent with the PERB precedent
holding that the factfinding right is available when meet and
confers result in impasse.
Opponents state, "Employment law attorneys whose clients are
public agencies have explained that generally they encourage
their clients to attempt mediation after impasse. However,
since mediation is designed for the parties to reach agreement,
requiring the parties to participate, rather than agree to
participate, in an involuntary mediation is seldom successful.
This mandate for mediation will only delay the labor
negotiations process. Additionally, delaying the negotiations
process will make it more difficult for agencies to prepare and
plan their budgets."
Additionally, opponents state, "We support the use of mediation
as an alternative means of dispute resolution. However, we
believe that mediation is only effective if the parties
participate voluntarily with the mutual goal of resolving
outstanding disputes. The notion that one party can force the
other to participate in mediation defeats the very intent of the
mediation process, which will seriously compromise the
effectiveness of any resulting mediation. As such, and contrary
to the intent of the bill, mandated mediation will likely add to
the length, complexity, and cost of labor disputes. Thus, the
grounds upon which mediation can be requested should be left to
the discretion of the local agency rules regarding employee
labor negotiations, and the decision of whether to participate
should be left to the discretion of the parties, subject to
those rules."
"In addition, the five (5) day time limit to agree upon the
appointment of a mediator is of great concern. The five day
period seems unreasonably and unnecessarily short. The decision
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to agree upon a mediator who is trusted and respected by both
parties is one that requires careful deliberation and
consideration. Attempting to force a decision within five (5)
days of the mediation request will only lead to additional
delay, conflict, and expense on the part of both parties, if
that short time period proves insufficient. If the employer and
the employee representatives have not come to an agreement on
matters related to terms and conditions of employment, it seems
wise to give those same parties additional time to review and
select a mediator."
"Furthermore, the mandatory mediation would constitute a state
mandated cost. As such, the mediation costs incurred by local
public agencies under AB 537 would add additional and
unnecessary expense to our already burdened public agencies."
Analysis Prepared by : Karon Green / P.E., R. & S.S. / (916)
319-3957
FN: 0000766