Court Opinion

ID: 9754260
Source: CourtListenerOpinion
Date Created: 2023-08-28 19:52:24.023266+00
Date Added: 2024-06-11T07:27:51.165163
License: Public Domain

WATHEN, Chief Justice,
with whom GLASSMAN and LIPEZ, Justices, join, dissenting.
The duty to bargain in good faith requires employers and employees to maintain the status quo with respect to conditions of employment until an agreement is achieved or they reach an impasse. The preservation of the status quo prevents either party from circumventing their statutory obligation to bargain by making unilateral changes in existing wages, hours, or working conditions. Two rules have been applied when a collective bargaining agreement expires with no new agreement in place. The “static status quo rule” would require and permit public employers to pay only those wages in effect when the agreement expired, unless the agreement provides otherwise. The “dynamic status quo rule,” however, would require and permit a public employer to pay wages according to the wage plan of the expired agreement, including any scheduled step increases. The Maine Labor Relations Board has concluded that the University’s withdrawal of the step increases specified in the existing wage provisions constitutes a unilateral change in wages. I reject the Court’s conclusion that the Board’s adoption of the “dynamic rule” is inconsistent with the intent, plain language, and history of Maine’s public sector labor law. I respectfully dissent.
I. Authority of the Board
The initial question before us relates to the Board’s statutory authority to find that a change in the conditions of employment occurred when the University unilaterally discontinued the existing schedule of annual step increases. The Board has consistently tracked private sector labor law in ruling that the duty to confer and negotiate in good faith imposes an ancillary duty to maintain the status quo during negotiations until a new agreement is reached, or impasse occurs. Mountain Valley Educ. Ass’n v. Maine Sch. Admin. Dist. No. 43, 655 A.2d 348, 351-52 (Me.1995); Lane v. Board of Directors of Me. Sch. Admin. Dist. No. 8, 447 A.2d 806, 809-10 (Me.1982). See also NLRB v. Katz, 369 U.S. 736, 743, 82 S.Ct. 1107, 1111, 8 L.Ed.2d 230 (1962) (holding that *847an employer’s unilateral change in wages and sick leave policy under negotiation violates the National Labor Relations Act because it is a circumvention of the duty to negotiate); Litton Fin. Printing v. NLRB, 501 U.S. 190, 198, 111 S.Ct. 2215, 2221, 115 L.Ed.2d 177 (1991) (“The Katz doctrine has been extended as well to cases where, as here, an existing agreement has expired and negotiations on a new one have yet to be completed.”); NLRB v. Allied Prod. Corp., 548 F.2d 644, 653 (6th Cir.1977) (“The Act is violated by a unilateral change in the existing wage structure whether that change be an increase or the denial of a scheduled increase.”)
In 1979, in Easton Teachers Ass’n v. Easton Sch. Comm., No. 79-14, at 7 (Me. L.R.B. Mar. 13, 1979) the Board’s first applied the “static status quo” rule to post-expiration wages.1 Under this rule, the status quo is maintained after contract expiration by freezing wages at the level they were when the contract expired. Id. The Board expressly noted in Easton that it preferred a static view of the status quo as opposed to the dynamic view. Id. Shortly thereafter, however, in a case involving the University, the Board refused to apply the “static” rule to a wage dispute during negotiations for an initial contract, instead adopting the “dynamic” rule for this situation. Teamsters Local Union No. 48 v. University of Me., No. 79-08 (Me. L.R.B. June 29, 1979), appeal dismissed for lack of prosecution, No. CV-79-406 (Me.Super.Ct., Ken.Cty., Dec. 30, 1981). The Board explained the reasons for this different treatment. First, in the pre-contract period, there “could be no understanding or agreement on a termination date at which point wage levels might be frozen in the future.” Second, the Board pointed out that it can take years to negotiate an initial contract, and employers could enjoy a windfall if automatic wage escalator provisions could be terminated on certification of a bargaining agent. Id. at 5.
In 1991, two years before the decision in this case, the Board reversed itself completely and adopted the “dynamic” rule for post-expiration wages. The Board offered the following explanation:
Why should the terms and conditions in a contract provision, however it is drafted, be frozen upon contract expiration for health insurance and other terms and conditions of employment, but not when that contract provision contains a wage escalator? ...
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After careful consideration, we conclude that Easton must be overturned, to the extent that it treats wage escalator provisions of an expired contract differently than it treats other provisions. We find the following principle, stated in Easton itself, to be a sound approach to the issue of maintaining the status quo, which principles should be applied consistently:
In essence, there is no difference between collective bargaining for an initial agreement, during which all existing terms and conditions of employment are frozen until proposed changes have been fully negotiated, and collective bargaining for subsequent agreements, during which existing terms and conditions of employment (as embodied in a prior agreement) are again frozen until proposed changes have been fully negotiated.
Auburn Sch. Adm’rs Ass’n v. Auburn Sch. Comm., No. 91-19, at 20-21 (Me.L.R.B. Oct. 8, 1991), consolidated appeals dismissed per stipulation, No. CV-91-459 and -464 (Me.Super.Ct., And.Cty., Apr. 24,1992). The new “dynamic” rule is in accord with pre-contract wage treatment and also with the Board’s treatment of health insurance. See id. at 19-21. Consistent with the “dynamic” rule applied in Teamsters and Auburn, the Board noted in the present case that “it is the wage provision that is frozen, not wages themselves.” (Emphasis added.)
The University challenges the Board’s decision and argues that the parties agreed to freeze wages at the expiration of the agree*848ment pending a successor agreement, “because that was the law [in 1989] when the Agreement was executed.” Although, for purposes of constitutional analysis, we have held that contracts are subject to statutes in effect when the contracts are entered into, see, e.g., Director of Bureau of Labor Standards v. Fort Halifax Packing Co., 510 A.2d 1054, 1062 (Me.1986), aff'd, 482 U.S. 1, 107 S.Ct. 2211, 96 L.Ed.2d 1 (1987), there is no authority for the proposition that a contract silently incorporates all existing administrative decisions on matters that could have been dealt with expressly. When it executed the agreement, the University may have assumed that the “static” rule would prevail on expiration, but that assumption was dispelled before the agreement expired, and is secured neither in contract nor law. Moreover, the unfairness that the Court finds compelling in this case could have been addressed in the original agreement or could have been the subject of bargaining before the expiration of the agreement.
I reject the University’s contention that the Board’s order compels the University to implement a wage increase that it never agreed to, in violation of 26 M.R.S.A. § 1026(1)(C) (“neither party is compelled to agree to a proposal or required to make a concession”) and our holding in Caribou Sch. Dep’t v. Caribou Teachers’ Ass’n, 402 A.2d 1279 (Me.1979) (finding that the Board, by ordering retroactive payment of wage and benefit increases, was making a contract for the parties, which the Board did not have the authority to do). In a similar vein, the University argues that requiring it to pay higher wages after the agreement expired effectively extends the contract term beyond the three-year limit provided in 26 M.R.S.A. § 1026(1)(D). The Act limits the term of a collective bargaining agreement to three years, but it places no specific time limit on the duty to bargain. The preservation of the status quo is an attribute of bargaining in good faith, and it results in neither an agreement nor a concession. Mountain Valley, 655 A.2d at 353. As is well stated by the Associated COLT Staff, the Board has no authority to determine what the parties should be bargaining toward (the final terms of an agreement), but it is empowered to determine what the parties should be bargaining from (the existing terms and conditions of employment).
I disagree with the opinion of the Court that the Board’s adoption of the “dynamic” rule is plainly inconsistent with the provisions of the Act. The rule is fashioned from a comparable rule in private sector labor law, see Robert A. Gorman, Basic Text on Labor Law, Unionization and Collective Bargaining 450 (1976), and refines the prohibition against unilateral change that is universally recognized in collective bargaining in both the private and public sector. See Mountain Valley, 655 A.2d at 353. The specific application of the “dynamic” rule in public employment to wage provisions in an expired contract is supported by court and agency decisions in other states.2 In my view, the Board acted well within its statutory authority.
*849II. Fiscal Concerns
Underlying the Court’s opinion and running throughout the argument of the University and the brief filed by the Maine School Boards Association as amicus curiae is the policy argument articulated by the Superior Court — the Board should not be permitted to require a public employer “caught in difficult economic times to continue to increase wages at rates agreed to when times were better.” Implicit within the Superior Court’s ruling is the argument that the Board is improperly infringing on “governmental authority and the accountability of public employers to the taxpayer and citizenry.” It is true that the Legislature carefully preserved the power of the public employer not to agree. Mountain Valley, 655 A.2d at 353. But it is equally true that the same Legislature imposed the duty to bargain, and it is that duty that the Board has interpreted to require the preservation of existing practices until impasse. Unquestionably there are significant fiscal implications involved when a public employer is required to continue a past practice set forth in an expired wage provision or health care plan while bargaining for a new contract. There is a meaningful legal difference, however, between compelling an agreement, and preserving the status quo while the parties are bargaining. Id. at 353. It is this distinction that the Act compels.
In an effort to balance the bargaining relationship, the Legislature replaced the right to strike and engage in work stoppages with mediation, factfinding, and arbitration. See 26 M.R.S.A. § 1026. In public sector employment, impasse cannot occur until those procedures have been exhausted. Mountain Valley, 655 A.2d at 352. If impasse occurs, however, either party is free to institute unilateral change.
It is conceivable that, in a particular case, before reaching impasse the parties may face a delay that exceeds the length of any contract that might be considered. The impasse procedures mandated by the Legislature necessarily involve delay. See Raymond G. McGuire & Bryan M. Dench, Public Employee Bargaining Under the Maine Municipal Public Employees Labor Relations Law: The First Five Years, 27 Me.L.Rev. 29, 108-19 (1975). Obviously, the financial consequences resulting from the combination of delay and the requirement of preserving the status quo, whether dynamic or static, are most pronounced in time of financial crisis. In my view, however, such policy concerns are properly matters for legislative consideration rather than a judicially-crafted hardship exception to the duty to bargain. See Stephen P. Befort, Public Sector Bargaining: Fiscal Crisis and Unilateral Change, 69 Minn.L.Rev. 1221, 1274 (1985) (Public sector bargaining is not “an aberration that need be tolerated only when convenient or when its results are not too painful.”)
I would vacate the judgment and remand with instructions to enter an order affirming the decision of the Board.

. The fact that we affirmed the prior "static status quo” rule, M.S.A.D. No. 43 Teachers' Ass'n v. M.S.A.D. No. 43 Bd. of Directors, 432 A.2d 395 (Me.1981), does not suggest that the Board was required to use that rule. Rather, it simply indicates that the Board properly could apply the "static” rule to public employment law.

. See Vienna Sch. Dist. No. 55 v. Illinois Educ. Labor Relations Bd., 162 Ill.App.3d 503, 113 Ill. Dec. 667, 670-71, 515 N.E.2d 476, 479-80 (1987); Board of Educ. of Springfield Pub. Sch. v. Springfield Educ. Ass’n, 47 IIl.App.3d 193, 5 Ill. Dec. 374, 378, 361 N.E.2d 697, 701 (1977); Indiana Educ. Employment Relations Bd. v. Mill Creek Classroom Teachers Ass'n, 456 N.E.2d 709, 712 (Ind.1983); Wayne County Gov't Bar Ass'n v. County of Wayne, 169 Mich.App. 480, 426 N.W.2d 750 (1988); Local 1467, Int’l Ass’n of Firefighters v. City of Portage, 134 Mich.App. 466, 352 N.W.2d 284 (1984); West Cent. Educ. Ass’n v. WERC, No. 87CV257 (Cir.Ct.Wis. Apr. 22, 1988); California Sch. Employees Ass'n v. Davis Unified Sch. Dist., 4 Pub. Employee Rep. (Cal ed.) (Lab. Rel. Press) ¶ 11031 (Cal.Pub. Empl. Rel. Bd. Feb. 22, 1980); International Ass'n of Firefighters Local 2416 v. City of Cocoa, No. CA-88-014, 11 Nat’l Pub. Empl. Rep. (Lab.Rel.Press) FL-19311 (Fla.Pub. Employees Rel. Comm'n Oct. 17, 1988).
The New Hampshire Supreme Court, however, has applied the "static” rule to wage step increases in public employment. See Appeal of Milton Sch. Dist., 137 N.H. 240, 625 A.2d 1056, 1059-61 (1993). Interestingly, the dissent in that opinion would have found the step increases to be part of the status quo to be maintained. Id. at 1063-65 (Brock, C.J. & Batchelder, J., dissenting). The Pennsylvania Supreme Court also has applied the "static" rule to public employment wage increases. However, that case arose in the context of unemployment compensation claims, not a prohibited practice complaint. Fairview Sch. Dist. v. Commonwealth of Pennsylvania Unemployment Compensation Bd. of Review, 499 Pa. 539, 454 A.2d 517, 520-21 (1982).