Opinion ID: 2606328
Heading Depth: 1
Heading Rank: 11

Heading: Impasse

Text: We now turn to the issue of whether the City was justified in insisting to impasse on adoption of the management rights clause. The City claims the Association's arguments on this issue run counter to persuasive federal cases directly on point holding that management rights proposals are mandatory subjects of bargaining. [5] Unfortunately for the Association, federal case law on this subject is uniform, well settled and completely contrary to its position. In N.L.R.B. v. American Nat'l Ins. Co., 343 U.S. 395, 408-09, 72 S.Ct. 824, 832, 96 L.Ed.1027 (1952), the United States Supreme Court held [w]hether a contract should contain a clause fixing standards for such matters as work scheduling or should provide for more flexible treatment of such matters is an issue for determination across the bargaining table, not by the [National Labor Relations] Board. Id. at 409, 72 S.Ct. at 832. There the union had objected to a proposed management rights clause that would have given management `[t]he right to select and hire, to promote to a better position, to discharge, demote or discipline for cause, and to maintain discipline and efficiency of employees and to determine the schedules of work....' Id. at 398, 72 S.Ct. at 826 (quoting respondent's counter-proposal: Functions and Prerogatives of Management). Concluding that such contracts were not per se evidence of bad faith bargaining, the Court noted that a review of typical contract clauses... shows that management functions clauses similar in essential detail to the clause proposed by respondent have been included in contracts negotiated by national unions with many employers. Id. at 405, 72 S.Ct. at 830. The Court also noted that the matters covered by the management functions clause were `conditions of employment' which are appropriate subjects of collective bargaining.... Id. at 407, 72 S.Ct. at 831. Because the United States Supreme Court's decision in American National predates the mandatory/permissive methodology it adopted in Borg-Warner, the Court did not specifically classify management rights clauses as mandatory in that case. However, subsequent federal courts have consistently held management rights clauses are mandatory subjects of bargaining. See N.L.R.B. v. Salvation Army, 763 F.2d 1, 7 (1st Cir.1985) ([I]t is true that a management rights clause covering terms or conditions of employment is a mandatory subject....); N.L.R.B. v. Tomco Communications, Inc., 567 F.2d 871, 878 (9th Cir. 1978) (An employer may insist on a management rights clause to impasse without violating the [National Labor Relations] Act.); Gulf States Mfrs., Inc. v. N.L.R.B., 579 F.2d 1298, 1318 (5th Cir.1978) (These substantive proposals of the Company on management rights were of no concern of the Board. The Company had the right to make them and could insist on them to impasse without violating the [NLRA].). Management rights clauses, however, can go only so far. Under the NLRA, such clauses cannot invade a union's statutory right and duty to be the exclusive representative of the relevant employees. For example, in Toledo Typographical Union No. 63 v. N.L.R.B., 907 F.2d 1220, 1222 (D.C.Cir. 1990) cert. denied, 498 U.S. 1053, 111 S.Ct. 767, 112 L.Ed.2d 786 (1991) ( Toledo Blade), the employer proposed a management rights clause that would have allowed it to directly address employees over retirement issues. The D.C. Circuit held that the proposed clause violated the NLRA and distinguished American National on the grounds that the clause in this case would have deprived the union of its statutory role as the employee's representative to the employer. Id. at 1223. The court noted that the clause at issue in American National would have ceded back to the employer an area within which it could set the terms and conditions of employment notwithstanding the union's statutory right to bargain over those matters, id. at 1223, whereas the clause here contemplates direct negotiations between employer and employee.... Id. at 1224. The court concluded [t]he clause does not, therefore, merely retain for the Employer unilateral authority to set certain terms and conditions of employment, as does a traditional management rights clause. Id. The Association argues, however, that Borg-Warner modified the holding in American National, which did not address waivers at all, and that federal precedent is inapplicable because of the differences between the NLRA and RCW 41.56. Under the NLRA, the employer is permitted to implement its last best offer, a power balanced by the union's right to strike, which is specifically forbidden for uniformed personnel in Washington. The fact that unions may resort to a strike, the Association contends, offsets the employer's right to insist on broad management rights language. The statutory scheme in Washington contradicts the Association's claim that American National and its progeny are inapplicable in this State. First, while the Association is correct that uniformed employees do not have the right to strike, it ignores the requirement that public employers are obligated to negotiate in good faith. RCW 41.56.030(4). This obligation insures that management rights proposals do not overreach and are enforceable under the statute. Second, any clause upon which the parties bargain to impasse will become a topic of interest arbitration. There the arbitration panel is instructed to be mindful of the statute's purpose to promote dedicated and uninterrupted public service through an effective and adequate means of settling disputes. RCW 41.56.465. This statute protects unions from the interest arbitration panel's rubber-stamping of employer proposals. Finally, as to the Association's claim that Borg-Warner somehow altered or overruled American National, no court in the 38 years since Borg-Warner has come to such conclusion. American National is persuasive authority. That Borg-Warner presented a more refined methodology for distinguishing proper subjects for arbitration does not change any of the results of American National. The ultimate issue then is whether the management rights proposal is a mandatory subject of arbitration which may be insisted upon to impasse. It is the particular proposal, not merely the problem to which it is addressed, that must concern wages, hours, and other terms and conditions of employment.' N.L.R.B. v. Davison, 318 F.2d 550, 557 (4th Cir.1963). In the case before this court, practically every item listed in the clause addresses either wages, hours or working conditions, i.e., mandatory subjects of bargaining. Nor does the management rights proposal circumvent the right of the union to represent its members, as would, for example, a direct dealing clause like the one in Toledo Blade. The hearing examiner found, in a decision affirmed and adopted by PERC, the City did not act in bad faith in making the proposal. We agree and affirm the PERC decision that the clause was a mandatory subject of bargaining.