Opinion ID: 6492552
Heading Depth: 1
Heading Rank: 1

Heading: facts

Text: On June 24, 2009, Lingle issued executive order 09-02. Therein it was observed that “the widespread impact of the global financial crisis and constantly decreasing revenue projections by the [state] Council on Revenues ... forced the State of Hawaii to make drastic and unprecedented revenue and expenditure adjustments to close a budget shortfall of approximately two billion dollars ($2,000,000,000) through the fiscal biennium 2009-2011[.]” (Brackets and ellipsis added.) It observed further that, “based on the May 28, 2009 projections by the [state] Council on Revenue, the State of Hawaii is ... facing an additional deficit of seven hundred thirty million dollars ($730,000,000) through the fiscal biennium 2009-2011, resulting in an immediate fiscal emergency of unparalleled magnitudes” In light of the current revenue estimates, executive order 09-02 ordered the furlough 4 of certain state executive branch employees for a total of seventy-two work days over the fiscal biennium 2009-2011, 5 which was to become effective on July 1, 2009, and subject to certain terms and conditions. Among these terms and conditions was the requirement that the affected state executive branch employees’ pay would be “automatically adjusted” by reducing the affected employee’s pay between 13.8% and 15.8% each pay period to account for the furlough days. Although executive order 09-02 was issued on June 24, 2009, on June 1, 2009, Lingle publicly announced her plan to, among other things, furlough certain state executive branch employees for “3 days/24 hours each month, from July 1, 2009 to June 30, 2011, thereby unilaterally reducing employees’ hours and cutting employees’ wages approximately 13.8%.”
After Lingle’s June 1, 2009 announcement, on June 16, 2009, HGEA filed a complaint in the circuit court that sought, among other things, a declaratory judgment that Lingle “cannot unilaterally impose the furloughs,” and a preliminary and permanent injunction enjoining Lingle from “unilaterally imposing” the same. HGEA based its request for relief on article XIII, section 2 of the Hawai'i constitution and HRS Chapter 89. In a first amended complaint filed on June 22, 2009, HGEA averred that Lingle “intends to unilaterally implement new procedures regarding layoffs after June 20, 2009 and impose mass state employee[ ] layoffs” “if her furlough plan is blocked by the courts.” As such, HGEA also sought a declaratory judgment that Lingle cannot “unilaterally impose new layoff procedures,” and a preliminary and permanent injunction enjoining Lingle from “unilaterally imposing” the same. On June 23, 2009, HGEA filed a motion for preliminary injunction. Briefly summarized, in its memorandum in support of its motion, HGEA asserted that collective bargaining is a constitutionally protected right and statutorily mandated. HGEA also asserted that furloughs are a “mandatory and core subject of collective bargaining” pursuant to HRS Chapter 89 and common law, and the eom-mon law “unilateral change” doctrine prevents Lingle from unilaterally imposing furloughs during the pendency of an arbitration process between it and the public employers. 6 On June 29, 2009, Lingle filed her opposition to HGEA’s motion for preliminary injunction. Among the arguments made, Lin-gle asserted that HGEA’s assertions are “predominately prohibited practices complaints that fall under HLRB’s ‘exclusive primary jurisdiction.’” Lingle also asserted that (1) the “management rights” in HRS § 89-9 (d) gives her authority to furlough “unionized workers” and these “rights” are not subject to collective bargaining, (2) the furlough order is consistent with article XIII, section 2 of the Hawai'i constitution, (3) the furlough order does not violate the unilateral change doctrine, (4) HGEA’s complaints about layoff procedures are premature and within HLRB’s jurisdiction even when ripe, (5) HGEA has not shown that they will suffer irreparable damage if the preliminary injunction is denied, and (6) the public interest requires denying the injunction. On July 28, 2009, the circuit court filed its findings of fact, conclusions of law, and order that, among other things, granted in part HGEA’s motion for preliminary injunction. 7 Therein, the circuit court made the following pertinent conclusions: (1) pursuant to United Pub. Workers, AFSCME, Local 64-6, AFL-CIO v. Yogi, 101 Hawai'i 46, 62 P.3d 189 (2002) and Malahoff v. Saito, 111 Hawai'i 168, 140 P.3d 401 (2006), Lingle’s unilateral decision to furlough certain unionized state executive branch employees “infringed on core subjects of collective bargaining [(namely, wages)], in violation of article XIII, section 2 of the Hawaii constitution[,]”; (2) pursuant to NLRB v. Katz, 369 U.S. 736, 82 S.Ct. 1107, 8 L.Ed.2d 230 (1962), “certain terms and conditions of an expired agree-inent continue in effect by operation of law” and, inasmuch as the furloughs “change wages,” the furloughs “cannot be imposed by unilateral action[,]”; (3) essentially, inasmuch as “the courts retain jurisdiction to consider constitutional claims[,]” Lingle’s assertion that the HLRB has exclusive jurisdiction over this matter is unpersuasive; (4) United Pub. Workers, AFSCME, Local 646, AFL-CIO v. Hanneman, 106 Hawai'i 359, 105 P.3d 236 (2005) is inapposite; (5) Lingle’s reliance on the “managerial rights” provisions in HRS § 89—9(d) “to justify unilateral imposition of the furlough program cannot be accepted because it would allow lawmakers absolute discretion to define the scope of collective bargaining, thereby defeating the intent of [a]rticle XIII, [selection 2[,]”; and (6) the issues of layoff procedures and criteria are not ripe for consideration at this time. A final judgment was filed on June 28, 2009. On July 31, 2009, Lingle timely filed a notice of appeal. On September 1, 2009, Lingle filed an application to transfer her appeal from the Intermediate Court of Appeals to this court. On September 22, 2009, this court granted Lingle’s application for transfer.