Court Opinion

ID: 856703
Source: CourtListenerOpinion
Date Created: 2013-03-29 17:30:42.563471+00
Date Added: 2024-06-11T09:06:33.125274
License: Public Domain

Notice: This opinion is subject to correction before publication in the P ACIFIC R EPORTER .
       Readers are requested to bring errors to the attention of the Clerk of the Appellate Courts,
       303 K Street, Anchorage, Alaska 99501, phone (907) 264-0608, fax (907) 264-0878, e-mail
       corrections@appellate.courts.state.ak.us.

                THE SUPREME COURT OF THE STATE OF ALASKA

PLUMBERS & PIPEFITTERS,                             )
LOCAL 367,                                          )    Supreme Court No. S-14664
                                                    )
                       Appellant,                   )    Superior Court No. 3AN-11-10463 CI
                                                    )
       v.                                           )    OPINION
                                                    )
MUNICIPALITY OF ANCHORAGE,                          )    No. 6770 - March 29, 2013
                                                    )
                       Appellee.                    )
                                                    )

               Appeal from the Superior Court of the State of Alaska, Third
               Judicial District, Anchorage, Alex Swiderski, Judge pro tem.

               Appearances: Charles A. Dunnagan and James S. Mundy,
               Jermain Dunnagan & Owens, P.C., Anchorage, for Appellant.
               William A. Earnhart, Assistant Municipal Attorney, and
               Dennis A. Wheeler, Municipal Attorney, Anchorage, for
               Appellee.

               Before: Winfree, Stowers, Maassen, and Bolger, Justices.
               [Fabe, Chief Justice, not participating.]

               PER CURIAM

               A union and a municipality entered into collective bargaining to renew the
union’s expiring contract. When negotiations broke down, the parties entered into
arbitration, but the arbitrator’s proposed decision failed to garner the necessary municipal
assembly votes to become binding on the parties. Under the municipality’s labor
ordinances, the assembly’s failure to approve the arbitrator’s decision resulted in an
impasse, with each party given a remedy: the municipality could implement its last best
offer presented at arbitration, and the union could go on strike. However, the union’s
statutory right to strike was limited and could be enjoined if the work stoppage
threatened public health and safety.
              Although the union voted to strike, it agreed to a preliminary injunction
before the strike was scheduled to begin because work stoppage would threaten public
health and safety almost immediately. The union then argued that the superior court
should impose the arbitrator’s decision as a condition of a permanent injunction to
compensate for “taking away” the union’s right to strike. The superior court held that
its equitable jurisdiction was constrained by the municipal code, which had no provision
for imposing the arbitrator’s decision, and entered an order permanently enjoining the
strike and allowing the municipality to implement its last best offer. The union appeals,
arguing the superior court erred as a matter of law in holding the municipal code limited
its equitable power to impose contract conditions as part of a permanent injunction.
              We AFFIRM the superior court in all respects and adopt its decision, which
is attached as an appendix.1

      1
                On appeal the union discusses several United States Supreme Court cases
for the first time. These cases are unpersuasive primarily because they involve decisions
whether an injunction would be granted rather than substantive conditions on an
injunction. See Winter v. Nat. Res. Def. Council, Inc., 555 U.S. 7, 32 (2008) (noting trial
court should consider balance of equities and public interest when deciding whether to
issue injunction); Amoco Prod. Co. v. Vill. of Gambell, 480 U.S. 531, 544 (1987)
(holding trial court had equitable discretion not to issue injunction under the Alaska
National Interest Lands Conservation Act); Weinberger v. Romero-Bercelo, 456 U.S.
305, 320 (1982) (holding trial court had equitable discretion not to issue injunction for
Clean Water Act violation).

                                           -2-                                       6770
                                     APPENDIX

            IN THE SUPERIOR COURT FOR THE STATE OF ALASKA

                 THIRD JUDICIAL DISTRICT AT ANCHORAGE

MUNICIPALITY OF ANCHORAGE, )

                           )
           Plaintiff,      )
                           )
v.                         )
                           )
UNITED ASSOCIATION OF      )
PLUMBERS AND PIPEFITTERS,  )
LOCAL 367,                 )
                           )
           Defendant.      )
Case No. 3AN-11-10463 CI

             ORDER GRANTING MUNICIPALITY’S MOTION FOR
           DECLARATORY JUDGMENT AND INJUNCTIVE RELIEF **

I.    INTRODUCTION
             The Plumbers and Pipefitters, Local 367 (Union) and the Municipality of
Anchorage have been engaged in negotiations over a new collective bargaining
agreement for more than one year. The parties came to an agreement on many aspects
of a new collective bargaining agreement but could not come to terms on several key
points. The dispute was submitted to an arbitrator as called for by the Anchorage
Municipal Code (AMC). The arbitrator issued a decision adopting the Union’s last best

      **
              The superior court’s decision has been edited to conform to the technical
rules of the Alaska Supreme Court.

                               Appendix - Page 1 of 31                           6770
                                        APPENDIX

offer on the primary issue of across-the-board wage increases. The arbitrator’s decision
was put before the Anchorage Assembly for approval. The Assembly failed to approve
the arbitrator’s decision. The Union’s employees then voted to strike.
             The Municipality filed for a preliminary injunction before the strike was set
to begin, arguing that the planned strike would threaten the public health, safety, and
welfare.   The Union agreed that a strike by Union employees would pose an
unacceptable risk to the public and did not oppose issuance of a preliminary injunction.
             Both parties now ask the Court to enter a permanent injunction prohibiting
the Union from going on strike through June 2013 — when the next round of collective
bargaining would begin. The Union further asks the Court to declare the arbitrator’s
decision binding upon the parties as a condition of entering the injunction. The
Municipality opposes this request and instead asks the Court to issue a declaratory
judgment following AMC 03.70.110.C.10.b — that the arbitrator’s award is
unenforceable, that the parties are at an impasse in their negotiations, and that the
Municipality may implement its last best offer.
             Because the Court concludes that the AMC forecloses the relief sought by
the Union and mandates the relief sought by the Municipality, the Court grants the
permanent injunction and the Municipality’s request for declaratory judgment.
II.   BACKGROUND
             Collective bargaining involving public employees is a highly regulated
process. The Court begins its analysis by reviewing the legal framework for collective
bargaining involving Municipality employees before turning to the specific facts and
procedural history of this case.

                                   Appendix - Page 2 of 31                          6770
                                      APPENDIX

      A.     The AMC’s Employee Relations Chapter
             Local governments have the power to fashion their own labor ordinances
and systems of collective bargaining.1 The Assembly chose to regulate employee
relations through Title 3, Chapter 70 of the AMC. The general policy behind Chapter
70 is to “promote harmonious and cooperative relations between the municipality and
its employees and to protect the public by ensuring orderly and effective operations of
government.”2
             Chapter 70 grants all non-exempt Municipal employees the right to
organize for the purpose of collective bargaining.3 Collective bargaining occurs between
the bargaining unit’s representative on the one hand and the mayor’s office . . . on the
other.4 While the mayor’s authorized negotiating team conducts collective bargaining
on behalf of the Municipality, the Assembly has the power to set the Municipality’s
general labor relations policy and to direct specific contract negotiations.5 In addition,

      1
            See Anchorage Mun. Emps. Ass’n v. Municipality of Anchorage, 618 P.2d
575, 580 (Alaska 1980).
      2
             AMC 03.70.020.A.
      3
             AMC 03.70.030, .060.C.
      4
             See AMC 03.70.090.
      5
             AMC 03.70.090.D.

                                Appendix - Page 3 of 31                             6770
                                       APPENDIX

any agreement between the Municipality and the bargaining representative must be
ratified by the bargaining unit and the Assembly.6
              In the event that the parties are unable to reach an agreement during the
collective bargaining process, Chapter 70 provides a series of steps that the parties must
undertake in moving towards a resolution of the dispute: mediation;7 fact finding;8 and,
finally, interest arbitration.9
              As part of the arbitration process, each party must submit its Last Best Offer
(LBO) on each individual outstanding issue. In resolving each issue in question, the
arbitrator is limited to selecting one of the parties’ LBOs — the arbitrator may not craft
his or her own resolution to a particular issue, nor may he or she combine portions of
each party’s LBO on a given issue.10 The arbitrator must hold hearings and issue a
decision within 60 days of the expiration date of the collective bargaining agreement.11
              At this point the rights and remedies of each party depend on the
classification of the affected bargaining unit employees. The AMC splits Municipality

       6
              AMC 03.70.130.A.
       7
              AMC 03.70.100.A.
       8
              AMC 03.70.100.B.
       9
              Id.
       10
              AMC 03.70.110.C.7.
       11
              AMC 03.70.110.C.4.

                                  Appendix - Page 4 of 31                             6770
                                      APPENDIX

employees into three classes: Class A.1 employees, Class A.2 employees, and Class A.3
employees.12
               Class A.1 employees. Class A.1 employees are those who engage in police,
fire protection and emergency services.13 Under the AMC, an arbitrator’s decision
affecting Class A.1 employees is automatically binding upon the parties.14 However,
Class A.1 employees are flatly prohibited from going on strike for any period of time.15
               Class A.2 and A.3 employees. Class A.2 is made up of employees in sewer
and water treatment, electrical generation and transmission, and port operation.16
Class A.3 is made up of all other employees.17 Both classes of employees are treated
similarly when it comes to the effect of an arbitrator’s decision: in each case, AMC
03.70.110.C.10.b provides that the arbitrator’s decision is binding on the parties only if
it is approved by at least eight members of the Assembly.
               Prior to the Assembly’s vote, the Municipality’s internal auditor must
review the arbitrator’s decision and the Municipality’s LBO, and provide the projected

      12
               See AMC 03.70.110.A.
      13
               AMC 03.70.110.B.
      14
               AMC 03.70.110.C.10.a.
      15
               See AMC 03.70.110.A.1.
      16
               AMC 03.70.110.B.
      17
               Id.

                                Appendix - Page 5 of 31                             6770
                                        APPENDIX

costs and savings under each option.18 If the Assembly does not approve the arbitrator’s
decision within a specified period of time, then “the parties shall be considered at
impasse,” “[t]he municipality may . . . implement its last best offer” and “the affected
bargaining unit may exercise its right to strike.”19
              While Class A.2 and A.3 employees are treated the same for purposes of
arbitration, they are not given the same right to strike. The AMC grants Class A.2 only
a “limited” right to strike20 with the limit determined “by the interests of the health, safety
and welfare of the public.”21 Class A.3 employees, on the other hand, are granted an
almost unfettered right to strike absent “extraordinary circumstances.”22
              Section 3.70.110.B of the AMC allows the Municipality to apply to the
superior court for an order enjoining a strike by Municipal employees. In the case of
Class A.2 employees, the superior court may only enjoin the strike if it has begun to
threaten the health, safety, or welfare of the public.23 The AMC further counsels:
              A court in deciding whether or not to enjoin the strike shall
              consider the total equities in the particular class. . . . [T]he
              term ‘total equities’ includes not only the impact of the strike
              on the public but also the extent to which employee

       18
              AMC 03.70.110.C.10.b.

       19
              Id.

       20
              AMC 03.70.110.A.2; AMC 03.70.110.B.

       21
              AMC 03.70.110.B.
       22
              See AMC 03.70.110.A.3; AMC 03.70.110.B.
       23
              AMC 03.70.110.B.

                                  Appendix - Page 6 of 31                                6770
                                      APPENDIX

             organizations and public employers have met their
             obligations under [the employee relations chapter].[24]
The AMC does not specifically state what effect the issuance of an injunction has on the
parties or the collective bargaining process.
      B.	    Facts And Procedural History
             The Union represents employees of the Anchorage Water and Wastewater
Utility (AWWU) — a division of the Municipality. These employees are responsible for
the operation and maintenance of Anchorage’s drinking water and sewage treatment
plants. They are Class A.2 employees under the AMC.25
             The Union and the Municipality began negotiations for a new collective
bargaining agreement in March or April of 2010. The parties’ prior collective bargaining
agreement expired on June 30, 2010. The parties have maintained the status quo of the
terms and conditions of employment — meaning, primarily, that Union employees have
not received an across-the-board wage increase since July 1, 2009.
             Despite ongoing negotiations, the parties were unable to agree on several
key aspects of a new agreement. Pursuant to the AMC, the parties underwent mediation,
fact-finding, and finally arbitration of the parties’ remaining disputes. Retired Judge
Douglas Serdahely served as fact-finder and arbitrator. The primary issue put before the
arbitrator dealt with across-the-board wage changes, a one-time market-based adjustment
to the wage scales, and the continuation or termination of the “Service Recognition
Program.” In accordance with AMC 03.70.110.C.8.a(2), these issues were all treated as

      24	
             Id.
      25
             See id.

                               Appendix - Page 7 of 31                            6770
                                     APPENDIX

one lump subject such that the arbitrator had to select between the Union’s and the
Municipality’s LBOs as to all three sub-issues.
             The Municipality’s LBO consisted of no across-the-board wage increase
in 2010, followed by a 2.5% wage increase in 2011 and another 2.5% wage increase in
2012. The Municipality’s LBO contained no market-based adjustment and proposed to
eliminate the Service Recognition Program for new employees.
             The Union’s LBO consisted of no across-the-board wage increase in either
2010 or 2011, with an across-the-board wage increase in 2012 equal to the Anchorage
CPI-U (Consumer Price Index) average for the previous five-year period — with a
minimum increase of 2.5% and a maximum increase of 3.9%. The Union further
proposed a one-time market-based adjustment in 2011 amounting to an increase of $3.00
per hour for most union employees.       The Union also proposed that the Service
Recognition Program continue in its present form.
             An arbitration hearing was held on July 25, 2011, and the arbitrator issued
his decision on August 8, 2011. The arbitrator selected the Union’s LBO on the issue
of wages. The arbitrator found that there was a significant disparity between the wages
of the Union’s employees and the wages of similar workers within the Municipality and
in the private sector. The arbitrator also rejected the Municipality’s argument that
smaller pay increases were necessary in light of the post-recession economy, noting that
the Municipality and the IBEW Mechanics’ union had recently agreed to a contract
providing for substantially greater pay increases than the Municipality had offered the
Plumbers and Pipefitters’ union.

                               Appendix - Page 8 of 31                            6770
                                      APPENDIX

              The net result of the arbitrator’s decision was that Union employees would
receive a one-time $3 per hour wage increase in 2011 and a wage increase between 2.5%
and 3.9% in 2012. In addition, the Service Recognition Program would continue for all
union employees.26
              The arbitrator’s decision was sent to the Assembly for approval. An
internal audit report indicated that implementation of the arbitrator’s decision would cost
the Municipality between $3,191,722 and $3,394,446 through June 30, 2013.
Implementation of the Municipality’s LBO would cost $988,071 over the same period.
              The Assembly voted on approval of the arbitrator’s decision on August 30,
2011. Seven of eleven Assembly members voted to approve the arbitration decision —
one vote short of the eight votes necessary for approval under the AMC.27
              The Union held a meeting on the evening following the Assembly’s vote
and asked its members to vote to strike. Union employees approved the strike by a vote
of 113-2. The strike was set to begin at 10:00 a.m. on September 2, 2011.
              On September 1, 2011, the Municipality filed suit in Anchorage Superior
Court to enjoin the planned strike. The Municipality asserted that Union employees

      26
              The arbitrator selected the Municipality’s LBO on the two other issues
submitted to arbitration: 1) the termination of an existing program to pay supplemental
payments to injured workers to ensure that, together with Workers’ Compensation
payments, such workers receive 80% of their regular pay; and 2) the termination of a 5%
premium payment for field inspections. The arbitrator noted that the supplemental
Workers’ Compensation payments did not apply to the vast majority of union employees;
and that the job description for affected union employees now included routine field
inspections, thus rendering the premium payment superfluous.
       27
              See AMC 03.70.110.C.10.b.

                                Appendix - Page 9 of 31                              6770
                                       APPENDIX

could not go on strike for more than 48 hours before the strike would pose serious risks
to AWWU’s facilities and the continued successful operation of its water and sewage
systems; and that even a strike shorter than 48 hours could cause partial system failure
if an unexpected event or breakdown occurred.
             The Court held a hearing on the same day the Municipality filed suit. The
Union agreed in advance of the hearing that the strike should be enjoined to protect the
health, safety, and welfare of the public. The Court entered a preliminary injunction
prohibiting Union employees from going on strike, with a specific provision that the
parties had not waived any future argument as to the terms of a permanent injunction.
             Following entry of the preliminary injunction, the Municipality filed an
amended complaint for declaratory and injunctive relief. The Municipality requested a
declaration from the Court that, under AMC 03.70.110.C.10.b, the arbitrator’s decision
is unenforceable, that the parties are at an impasse, and that the Municipality may
implement its LBO. The Municipality further requested entry of a permanent injunction
prohibiting the Union from striking.
             The Union did not oppose the entry of a permanent injunction in its
amended answer, but instead requested that the Court impose the arbitrator’s decision
on the parties as a condition of the permanent injunction.28

      28
             In its original answer, the Union also brought counterclaims based on the
implied covenant of good faith and fair dealing and substantive due process. The Union
did not appear to raise these claims in its amended answer and did not pursue them in its
briefing or at oral argument. Therefore the Court concludes that the Union has
abandoned these claims.

                               Appendix - Page 10 of 31                            6770
                                      APPENDIX

              The parties fully briefed the issues and oral argument was held on
November 9, 2011.
III.   DISCUSSION
              The parties agree that the Court should enter a permanent injunction. The
Municipality contends that a strike by Union employees of any duration would
immediately pose an unacceptable threat to the public health, safety, and welfare. The
Union has consistently agreed with the Municipality on this point throughout the
litigation. In addition, the Municipality and the Union agree that both parties have
negotiated in good faith and otherwise met their obligations under the AMC’s Employee
Relations chapter. Therefore issuance of a permanent injunction is proper pursuant to
AMC 03.70.110.B.29
              Where the parties disagree is the effect that issuance of a permanent
injunction has on the parties’ rights and the collective bargaining process. The Union
contends that if the right to strike under the AMC is taken away through entry of a
permanent injunction, the Court should exercise its equitable power to substitute the right
to binding arbitration and impose the interest arbitration award. The Municipality
contends that the AMC does not allow an interest arbitration award affecting Class A.2
employees to be made binding on the parties in the absence of Assembly approval. The
Municipality further contends that the Court should declare pursuant to AMC

       29
              The Court hereby incorporates the Findings of Fact and Conclusions of
Law from the Preliminary Injunction Order entered September 1, 2011, to the extent that
they are not inconsistent with this Order.

                               Appendix - Page 11 of 31                              6770
                                        APPENDIX

03.70.110.C.10.b that the parties are at an impasse and that the Municipality may
implement its LBO.
                The Union’s arguments raise two primary issues. The first issue is whether
the Court may exercise its full equitable jurisdiction to decide the parties’ bargaining
dispute notwithstanding the strictures of the AMC. If the Court may not exercise its full
equitable jurisdiction and must instead act within the bounds of the AMC, then the
question becomes whether the AMC itself allows for the remedy that the Union seeks.
The Union has not directly attacked the AMC provisions — it does not contend, for
example, that those provisions are unconstitutional or otherwise infirm. Rather, the
Union asserts that the relief it requests is consistent with the Court’s equitable
jurisdiction and is not repugnant to the AMC.
      A.        The Court’s Equitable Jurisdiction Is Limited By The AMC.
                The Union contends that the Municipality invoked the Court’s full equitable
jurisdiction when it filed a complaint for injunctive relief, such that the Court may
fashion whatever equitable remedy it deems just to resolve the parties’ overall collective
bargaining dispute. The Union principally relies on Hecht Co. v. Bowles30 in support of
its argument.
                In Hecht, the United States Supreme Court held that the Emergency Price
Control Act of 1942 did not remove courts’ traditional equitable discretion in deciding
whether to issue an injunction.31 The Act stated that upon a showing that a person has

      30
                321 U.S. 321 (1944).
      31
                Id. at 328-29.

                                 Appendix - Page 12 of 31                            6770
                                      APPENDIX

or is about to violate the Act, “a permanent or temporary injunction, restraining order,
or other order shall be granted without bond.”32 The government argued that the
language “shall be granted” made issuance of an injunction mandatory under the Act.33
In rejecting this argument, the Court recognized the long history of the power of equity
jurisdiction to craft each decree to the particulars of each case.34 The Court concluded
that there was no evidence of a clear and unequivocal intent by Congress to depart from
this traditional equity practice when it enacted the Act.35
              The Municipality counters that the Court’s equitable jurisdiction is limited
by the AMC. It relies on two principles of equity jurisdiction recognized by the Alaska
Supreme Court in Riddell v. Edwards.36 The first principle is that “a court acting in
equity ordinarily cannot [intrude] in matters that are plain and fully covered by [a]
statute.”37 A second and closely related principle is that “a court must not apply equity
to do indirectly what the law or its clearly defined policy forbids to be done directly.”38

       32
              Id. at 322.

       33
              Id. at 326-27.

       34
              See id. at 329-30.

       35
              Id. at 330.

       36
              76 P.3d 847 (Alaska 2003).

      37
             Id. at 854 (quoting Pac. Scene, Inc. v. Penasquitos, Inc., 758 P.2d 1182,
1186 (Cal. 1988)) (internal quotation marks omitted).
       38
            Id. at 855 (quoting Pac. Scene, Inc., 758 P.2d at 1186) (internal quotation
marks omitted).

                                Appendix - Page 13 of 31                             6770
                                      APPENDIX

Put another way, “[c]ourts of equity can no more disregard statutory and constitutional
requirements and provisions than can courts of law.”39
              Collective bargaining involving public employees is a highly regulated
process. The AMC provides an explicit and comprehensive scheme governing collective
bargaining between employee unions and the Municipality. It sets forth a step-by-step
process for the resolution of outstanding issues in collective bargaining, with strict
constraints and timelines. The AMC only allows the parties to involve the court in
limited circumstances, such as when applying for an injunction prohibiting a strike by
Class A.2 or A.3 employees,40 or on appeal of an arbitrator’s decision affecting Class A.1
employees.41 Most importantly in the context of this case, the circumstances under
which an arbitrator’s decision may be made binding on the parties is fully covered by
AMC 03.70.110.C.10.b. The AMC addresses impasses in the collective bargaining
process and does not contemplate involvement of the courts beyond the finite
circumstances outlined in the AMC.
              This conclusion is buttressed by the fact that public employees do not have
an inherent right to strike or an inherent right to binding arbitration.42 Public employees

       39
              Hedges v. Dixon County, 150 U.S. 182, 192 (1893).
       40
              AMC 03.70.110.B.
       41
              AMC 03.70.110.C.10.a.
       42
            See Anchorage Educ. Ass’n v. Anchorage Sch. Dist., 648 P.2d 993, 996-97
(Alaska 1982).

                               Appendix - Page 14 of 31                              6770
                                      APPENDIX

have those rights only where granted by legislative enactment.43 The remedy the Union
seeks, binding arbitration, is available only to the extent that it is granted by the AMC.
The Court cannot issue an equitable decree vindicating the Union’s rights on the one
hand while acting outside the bounds of the very AMC that grants those rights on the
other.
              The Union’s argument on this point is that the parties have reached the end
of the process contemplated by the AMC and thus the code is no longer applicable. The
Union contends that the AMC always guides the parties towards a resolution of their
collective bargaining dispute, but that in this instance no resolution may be had because
the Union’s strike has been permanently enjoined. But while the AMC does aim for a
final resolution of the parties’ dispute, it does not mandate that a final resolution is
necessarily achieved by this point in the process.
              Provision 3.70.110.C.10.b provides that if the Assembly rejects the
arbitrator’s decision as to Class A.2 employees, as occurred here, then the parties are at
an impasse, the Municipality may or may not implement its LBO, and the Union may
choose whether to strike. Under this provision, there exist a number of scenarios where
the parties’ collective bargaining issue could be left unresolved after the Assembly votes
to reject an arbitration award. The Union could choose not to strike at all. Or the Union
could engage in an unsuccessful strike and return to work without concessions from the
Municipality. Or, as happened in this case, the Union could choose to strike but the
strike could be enjoined because of its impact on the public health, safety, and welfare.
The end result is the same in each instance and is fully contemplated by the AMC: the

         43
              Id.

                               Appendix - Page 15 of 31                             6770
                                      APPENDIX

parties are left at an impasse, the Municipality may unilaterally implement its LBO, and
the parties may return to the bargaining table once the conditions resulting in impasse
have changed.44
              The Court’s conclusion does not run contrary to Hecht Co. v. Bowles. In
Hecht the United States Supreme Court noted that the Emergency Price Control Act
expressly stated that a “permanent or temporary injunction, restraining order, or other
order shall be granted.”45 Because the entrance of orders other than an injunction or
restraining order was permissible under the Act, the trial court acted within its equitable
discretion in not granting an injunction and instead ordering the complaint dismissed.46
This case is distinguishable from Hecht because the AMC only speaks to whether the
Court should grant or withhold an injunction. The AMC does not allow for entry of
“other orders” nor does it otherwise state or imply that the Court may broadly wield its
equitable powers to settle the parties’ overall dispute. The Court has the equitable power
to grant the Union the relief it seeks only if that power can be found within the bounds
of the AMC’s Employee Relations chapter.
       B.	    The AMC Does Not Allow The Court To Order Imposition Of The
              Interest Arbitration Award As A Consequence Of Enjoining A Strike
              By Class A.2 Employees.
              The Union proposes two primary rationales under which the Court may

       44
              See generally 48A A M . JUR . 2D Labor and Labor Relations § 2326 (2005)
(discussing the consequences of a bargaining impasse under federal law).
       45
              Hecht Co. v. Bowles, 321 U.S. 321, 321 (1944).
       46
              See id.

                               Appendix - Page 16 of 31                              6770
                                        APPENDIX

order the interest arbitration award binding on the parties while honoring the framework
of the AMC. First, the AMC requires the Court to consider the “total equities” when
deciding whether or not to enjoin a strike by Class A.2 employees.47 The Union argues
that consideration of the “total equities” allows the Court to impose the interest
arbitration award as a consequence of issuing a permanent injunction. Second, the Union
contends that the AMC itself contemplates that all classes of Municipal employees
should have either the right to binding arbitration or the right to strike, and that therefore
the Court should substitute a right to binding arbitration when a class of employees’ right
to strike is “taken away” through the issuance of an injunction. The Union’s arguments
are examined in turn.
              1.	    In considering the “total equities,” the Court may not go beyond
                     the limited question of whether an injunction should be issued
                     to prevent the strike.
              AMC 03.70.110.B provides that the Court may only enjoin a strike by Class
A.2 employees if the strike has “begun to threaten the health, safety or welfare of the
public.” The AMC further counsels that “in deciding whether or not to enjoin the strike,”
the Court “shall consider the total equities in the particular class.”48 The AMC defines
the term “total equities” as “includ[ing] not only the impact of the strike on the public but
also the extent to which employee organizations and public employers have met their

       47
              AMC 03.70.110.B.
       48
              Id.

                                Appendix - Page 17 of 31                                6770
                                       APPENDIX

obligations under [the Employee Relations chapter].”49
               The Union contends that consideration of the “total equities” allows the
Court to impose whatever terms it deems equitable in issuing an injunction, including
imposition of the interest arbitration award on the parties. The Municipality argues that
the term “total equities” is more limited in its scope and that in any event, the Court may
not rule contrary to AMC 03.70.110.C.10.b by imposing the interest arbitration award
on the parties when the Assembly failed to approve it.
               The term “total equities,” taken on its own, might imply that the Court has
broad powers in fashioning an equitable remedy when the Municipality applies for an
injunction against a strike. But the term must be read within the context of AMC
03.70.110.B and the AMC’s Employee Relations chapter in general. AMC 03.70.110.B
states: “A court in deciding whether or not to enjoin the strike shall consider the total
equities in the particular class” (emphasis added). Thus, the provision expressly limits
consideration of the “total equities” to the context of whether the Court should enjoin the
strike.
               AMC 03.70.110.B also provides examples of what is included in the term
“total equities.” The AMC refers to “the impact of the strike on the public” and the
extent to which the parties have met their obligations under the AMC. The term “total
equities” contemplates a balancing act where, in determining whether to issue an
injunction, the Court should weigh the impact the strike might have on the public health,
safety, and welfare against the parties’ conduct in the course of collective bargaining —
including whether the parties took all of the necessary steps to resolve the dispute, such

          49
               Id.

                                Appendix - Page 18 of 31                             6770
                                        APPENDIX

as mediation, fact-finding, and arbitration, and whether each party has bargained in good
faith as required by the AMC. Conversely, the AMC does not list as examples factors
the Court would logically consider if the Court were deciding whether to impose an
arbitration award or an LBO, such as whether each side’s LBO was “fair,” or whether
the arbitrator rendered a just decision.
              Use of the term “total equities” does not open wide the doors of the Court’s
full equitable jurisdiction, but is instead limited to the discrete issue plainly stated in the
ordinance: whether an injunction should be issued. Because the Union has not argued
against an injunction but in fact agreed to it, the “total equities” provision is inapplicable
to the current controversy.
              Even if the term “total equities” did allow the Court to go beyond the finite
issue of whether to issue an injunction, the Court still could not simply impose the
interest arbitration decision as a complete resolution to the issue. AMC 03.70.110.C.10.b
states that a supermajority of the Assembly must approve an interest arbitration decision
before it may be binding on the parties.50 In this case, the Assembly voted seven to four
in favor of approval — one vote short of the necessary number to bind the Municipality
to the terms of the arbitration award. The Court may not do through equity what it is
prohibited from doing through law.51 Thus the Court may not use equitable relief to
render the arbitration award binding on the parties when the AMC requires Assembly
approval and the Assembly instead chose to reject the award.

       50
              AMC 03.70.110.C.10.b.
       51
              Riddell v. Edwards, 76 P.3d 847, 855 (Alaska 2003).

                                 Appendix - Page 19 of 31                                6770
                                        APPENDIX

              The Union disagrees, arguing that the Assembly did not “reject” the
arbitration award so much as it simply failed to approve it. But under the facts and law
of this case, that is a distinction without a difference. The Assembly voted on the
question whether to approve the award, and the award garnered too few votes to be
approved under the AMC. And AMC 03.70.110.C.10.b does not require that the award
be “rejected.” The section specifically provides that if the arbitrator’s decision is not
approved within 21 days of delivery of the arbitrator’s decision or seven days of receipt
of the internal auditor’s financial analysis of the arbitration award, whichever is later, the
parties shall be considered at an impasse, the Municipality may impose its LBO, and the
Union may strike.52
              Another problem with the Union’s rejection rationale is that the applicable
AMC provision once read as the Union now wishes to interpret it, but it has since been
amended to its current form. In 1988 the Assembly approved a version of the AMC
provision stating that arbitration decisions affecting Class A.2 and A.3 employees were
binding unless rejected by a three to five majority of the Assembly. The Assembly then
amended the provision one year later to provide that the arbitrator’s decision is binding
only if accepted by a supermajority of voters. Thus the Assembly evidenced a clear
intent to make affirmative Assembly approval a necessary condition for the arbitrator’s
decision to be binding on the Municipality. For the Court to now impose the arbitrator’s
award despite the Assembly’s failure to approve it by the necessary eight votes would
run contrary to the 1989 amendments to AMC 03.70.110.

       52
              AMC 03.70.110.C.10.b.

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                                      APPENDIX

              Consideration of the “total equities” as called for by AMC 03.70.110.B
does not provide a vehicle for the Court to reach beyond the limited question of whether
it should enjoin the strike. And even if the “total equities” provision did allow the Court
to reach beyond that limited question, the Court could not use its equitable powers to
impose the arbitration decision when the Assembly, in effect, rejected the same.
              2.	    The AMC does not express a general policy that every class of
                     Municipal employees must have either an unlimited right to
                     strike or a right to binding arbitration.
              The Union’s second argument is that the AMC grants each class of
employees either the right to strike or the right to binding arbitration, and thus when the
Court “takes away” the Union’s right to strike by entering an injunction it must substitute
a right to binding arbitration as quid pro quo.
              At the outset, the Court notes an inconsistency with the Union’s assertion
that the Court has “taken away” the Union’s right to strike by granting an injunction: the
Union has in fact not opposed the issuance of an injunction.           The Union could
conceivably have pushed to strike for a “limited” period of time as contemplated by the
AMC, but chose not to pursue that possibility. Nonetheless, the Court recognizes that
the Union acted in good faith and responsibly in not pushing the limits of the “health,
safety and welfare of the public,” and thus will proceed as though an actual controversy
exists notwithstanding the Union’s non-opposition.
              Turning to the Union’s argument, the Union asserts that a public policy in
favor of granting the Union either an unlimited right to strike or the right to binding
arbitration can be found in the stated policy underlying the AMC’s Employee Relations
chapter.

                               Appendix - Page 21 of 31                              6770
                                       APPENDIX

              The stated policy of the AMC’s Employee Relations chapter is “to promote
harmonious and cooperative relations between the municipality and its employees and
to protect the public by ensuring orderly and effective operations of government.”53 The
Union argues that when there is a breakdown in the collective bargaining agreement,
harmonious and cooperative relations can only be achieved by giving each party an
“economic weapon” that it may use against the other. In the Union’s case, this weapon
is either the right to strike or the right to binding arbitration; in the Municipality’s case
it is the option to unilaterally implement its LBO.
              The Union also points to Justice Rabinowitz’s dissent in Anchorage
Education Association v. Anchorage School District (AEA)54 in support of its argument
that public employees are generally given either the right to strike or the right to binding
arbitration. AEA dealt with an illegal strike attempt by public school teachers. Under the
version of the Alaska Public Employment Relations Act (PERA) in place at the time,
teachers presumably would have belonged among a class of public employees who were
granted a limited right to strike. However, the definitions section of PERA excluded
“teachers” from the definition of “public employees” under the Act, meaning that the
teachers did not have even a limited right to strike by statute.55 In addition to this lack

       53
              AMC 03.70.020.A.
       54
              648 P.2d 993 (Alaska 1982).
       55
              See id. at 995.

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                                       APPENDIX

of a statutory right to strike, the Court examined the common law and determined that
teachers did not have an inherent right to strike.56
              In response, the teachers noted that other public employees had either the
right to strike or the right to binding arbitration. The teachers argued that if they did not
have a right to strike then they must have a right to binding arbitration, or else they
would be denied equal protection of the law.57 The Court rejected this argument.
              The Court first found that the legislature’s decision to exclude teachers
from PERA bore a fair and substantial relationship to the purpose of PERA, which is to
“promote harmonious and cooperative relations between government and its employees
and to protect the public by assuring effective and orderly operations of government.”58
The teachers argued that this purpose would be frustrated by the absence of a right to
strike or right to binding arbitration because those rights are necessary to discourage bad
faith negotiating by employers. The Court disagreed, stating that “[w]hile it is true that
binding arbitration rights may give the teachers greater bargaining leverage, we cannot
say that it is required as a means of ensuring cooperative relations.”59 In addition, the
Court noted that neither a right to strike nor a right to binding arbitration was necessary

       56
              Id. at 995-96.
       57
              See id. at 996-97.
       58
              Id. at 997 (quoting AS 23.40.070).
       59
              Id.

                                Appendix - Page 23 of 31                               6770
                                       APPENDIX

to satisfy PERA’s purpose because, under Alaska law, the teachers’ public employers
were required to negotiate in good faith.60
               The Court then turned to the legislature’s decision to withhold from
teachers the right to binding arbitration that PERA afforded to other employees who
were not granted a right to strike. The Court stated: “It is permissible for the legislature
to have found that teachers, although necessary to the functioning of society so as to
forbid strikes, were not so essential as to require compulsory arbitration.”61 Thus the
Court determined that withholding both the right to strike and the right to binding
arbitration was substantially related to the legislature’s goal of uninterrupted school
operation.62
               Justice Rabinowitz dissented from the Court’s opinion on the issue of equal
protection. In Justice Rabinowitz’s view, the complete exclusion of teachers from the
strike and arbitration provisions of PERA was not substantially related to the purposes
of that Act.63 Justice Rabinowitz noted that PERA’s primary purpose was “to provide
rational and effective guidelines for public employment relations” — a purpose
substantially similar to that embodied in AMC 03.70.020.A.             Justice Rabinowitz
explained that PERA furthered this purpose by balancing the employees’ need for
effective means of bargaining with the state’s need to maintain uninterrupted services in

       60
               See id. (citing former AS 14.20.550).

       61
               Id.

       62
               Id.

       63
               Id. at 998-99 (Rabinowitz, J., dissenting).

                                Appendix - Page 24 of 31                              6770
                                      APPENDIX

certain essential governmental operations.64 Thus PERA placed employees into three
categories: “non-critical” employees who were given a general right to strike; “semi­
critical” employees who were allowed a limited right to strike; and “critical” employees
who were denied any right to strike but were given the right to binding arbitration in
return.65
             Justice Rabinowitz explained that the legislature’s choice to exclude
teachers from any of the foregoing three classes was not substantially related to PERA’s
purpose because:
             Under PERA the category of ‘critical’ employees was
             granted the right to binding arbitration to compensate for the
             total denial of a right to strike. In essence the legislature
             realized that while a ban on strikes for ‘critical’ public
             employees was necessary, such a ban placed these employees
             in a disadvantageous bargaining position. Therefore, in the
             interest of fair and meaningful negotiations these employees
             were given the right to binding arbitration. . . . Viewed in this
             perspective, the denial of binding arbitration to teachers,
             coupled with the ban on strikes seems at odds rather than
             ‘substantially related’ to the purposes of PERA in that it
             significantly handicaps public school teachers in their
             collective bargaining efforts.[66]

       64
             Id. at 998.
       65
             Id.
       66
             Id. at 999.

                               Appendix - Page 25 of 31                           6770
                                      APPENDIX

Thus, Justice Rabinowitz would have held that PERA violated the equal protection
clause by completely excluding teachers from the strike and arbitration provisions of
PERA.67
             The Union essentially argues that the Assembly adopted this theory in
drafting its Employee Relations chapter. As the argument goes, the Assembly intended
that each group of employees would have a weapon that they could use against the
Municipality in the event that collective bargaining negotiations were not fruitful: they
could either go on strike, or they could force the issue to binding arbitration. If the
Union’s right to strike is enjoined, the Union argues, then they must have the right to
binding arbitration substituted in its place. Otherwise, Union employees would end up
in a situation not contemplated by the AMC where they have neither the right to strike
nor the right to binding arbitration. And because the Municipality retains the option to
implement its LBO, the balance of power would be shifted toward the Municipality in
a manner not contemplated by the AMC.
             The Union’s argument is not persuasive for several reasons. Beginning
with the Union’s reliance on the AMC’s statement of policy, the Supreme Court held in
AEA that granting either the right to strike or the right to binding arbitration was not
necessary to vindicate the policy statement in PERA, which was substantially similar to
the AMC policy statement.68 Although the Court dealt with an equal protection claim
in AEA, the rationale applies with equal force to an argument that AMC 03.70.20

      67
             Id.
      68
             See id. at 997 (majority opinion).

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                                        APPENDIX

somehow mandates that all non-exempt Municipal employees must have either a right
to strike or a right to binding arbitration. This is especially true in light of the fact that
the teachers in AEA had no right to strike whatsoever, whereas the Union is granted a
limited right to strike under the AMC.69 If the State could satisfy the purposes of PERA
while withholding from teachers even a limited right to strike, then the AMC certainly
may satisfy its similarly stated purpose by granting a limited right to strike to Union
employees. In addition, as in AEA, the Union is still protected by the Municipality’s duty
to bargain in good faith.70
              Turning to his dissenting opinion in AEA, Justice Rabinowitz’s views were
not accepted by the majority of the Court and therefore hold limited persuasive value in
the instant case. Moreover, even Justice Rabinowitz did not go so far as the Union is
now asking this Court to go. Justice Rabinowitz was concerned with the complete
exclusion of teachers from any class of employees under PERA.71 Unlike the Union
employees in this case, the teachers in AEA were not given even a limited right to strike.
In fact, Justice Rabinowitz specifically wrote that, in his view, the State would not have

       69
              See AMC 03.70.110.B.
       70
              See AMC 03.70.010, .020.A, 070.B, & .140.A.5.
       71
             See AEA, 648 P.2d at 998-99 (Rabinowitz, J., dissenting) (stating “the
question which must be answered is whether the exclusion of public school teachers
from any of [PERA’s three classes of employees] is reasonable in light of the purposes
of PERA”).

                                Appendix - Page 27 of 31                                6770
                                       APPENDIX

violated the equal protection clause if it had given the teachers the same limited right to
strike that Union employees have in this case.72
              The Union contends that the instant case is distinguishable from AEA
because the Assembly granted the Union a limited right to strike, whereas in AEA the
legislature granted teachers neither a right to strike nor a right to binding arbitration. In
the Union’s view, the fact that the Assembly granted a limited right to strike means that
the Assembly must have believed that the Union would and should have a right to
binding arbitration when the limits of their right to strike were reached. But the Union
cites no authority for that assertion, it ignores overwhelming authority to the contrary,
and it conflicts with the express language of the AMC.
              The AMC repeatedly refers to the limited nature of the right to strike
enjoyed by Class A.2 employees. The services of Class A.2 employees are defined as
those that “may be interrupted for a limited period but not . . . indefinite period of
time.”73 AMC 03.70.110.B states that Class A.2 employees may engage in a strike only
“for a limited time”; that “[t]he limit” of Class A.2 employees’ right to strike “is
determined by the interests of the health, safety and welfare of the public”; and that the
strike may be enjoined if it has begun to threaten those interests.
              The AMC juxtaposes this limited right to strike on the part of Class A.2
employees with the more extensive right to strike enjoyed by Class A.3 employees.

       72
              See id. at 999 (“On the other hand, if teachers are not as essential as the
‘critical’ employees then they should enjoy the same limited strike rights given to other
‘semi-critical’ public employees.”).
       73
              AMC 03.70.110.A.2.

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                                       APPENDIX

Work stoppages involving Class A.3 employees “may be sustained for extended periods”
absent “extraordinary circumstances.”74 And a strike by Class A.3 employees may only
be enjoined in “extraordinary circumstances [threatening] the health, safety or welfare
of the public.”75
              Despite granting Class A.2 employees a more limited right to strike than
that enjoyed by other Municipal employees, the AMC does not substitute a right to
binding arbitration when the limits of Class A.2 employees’ right to strike have been
reached and an injunction has issued against them. Given that there is no inherent right
to strike or right to arbitration except those which are granted by legislative acts,76 this
absence of a substituted right to arbitration must be interpreted as a decision by the
Assembly to affirmatively deny Class A.2 employees that right.
              That the Assembly affirmatively chose not to substitute a right to arbitration
when an injunction is issued against a strike by Class A.2 employees is even clearer
when comparing the AMC scheme to Alaska’s state statutes. Like the AMC, the PERA
divides employees into three separate classes.77 Also similar to the AMC, Class A.2 state
employees’ right to strike is “limited” by the interests of the health, safety, or welfare of
the public, and the public employer may apply to the superior court to enjoin the strike

       74
              AMC 03.70.110.A.3.
       75
              AMC 03.70.110.B.
       76
            See Anchorage Educ. Ass’n v. Anchorage Sch. Dist., 648 P.2d 993, 995-97
(Alaska 1982).
       77
              See AS 23.40.200(a).

                                Appendix - Page 29 of 31                               6770
                                       APPENDIX

when these interests are threatened.78 The state statute goes on to say: “If an impasse or
deadlock still exists after the issuance of an injunction, the parties shall submit to
arbitration.”79 The AMC mandates non-binding interest arbitration before a strike may
be held but does not contain a similar provision allowing for binding arbitration as a
consequence of an injunction prohibiting a strike.
               It is permissible for the Assembly to have concluded that Class A.2
employees are essential enough that their right to strike should be limited, but not so
essential that they must be given the right to binding arbitration enjoyed by Class A.1
employees.80     Faced with the choice of completely withholding from Class A.2
employees any right to strike whatsoever or granting a limited right to strike that might
not be particularly useful, the Assembly chose the latter option. The Union wants to
make this limited right in to something more than it is. The premise of the Union’s
equitable argument is logically sound, the Court may assume that it is accurate, and the
Court is sympathetic to their plight, that as Class A.2 employees, they have less
bargaining leverage than either Class A.1 or A.3 employees. But that is the position that
the Assembly lawfully chose for them.
               The Union argues that the Court should superimpose upon the AMC either
an unlimited right to strike or a right to binding arbitration for all public employees. But

       78
               AS 23.40.200(c).
       79
               Id.
       80
              Cf. AEA, 648 P.2d at 997 (“It is permissible for the legislature to have found
that teachers, although necessary to the functioning of society so as to forbid strikes,
were not so essential as to require compulsory arbitration.”).

                                Appendix - Page 30 of 31                              6770
the Court cannot override the policy choices of the people’s elected representatives in
this manner. Such a maneuver by the Court “would be an action . . . tipping the social
balance in [the Municipality’s] labor relations.”81 This balance is set by the Assembly.
If the Union is to achieve a more favorable status for itself than it currently enjoys under
the AMC, it must do so through the political process, not the Courts.
IV.    CONCLUSION
              The Municipality’s Motion for Declaratory Judgment and Injunctive Relief
is GRANTED.
              The Union shall be permanently enjoined from going on strike through the
end of the current collective bargaining period in June 2013. Pursuant to AMC
03.70.110.C.10.b, the interest arbitration award is advisory only and cannot be imposed
on the bargaining parties; the parties are at an impasse; and the Municipality may
implement its LBO.

              Dated: February 10, 2012

              /s/   Alex M. Swiderski

              Superior Court Judge, Pro Tem

       81
              See id. at 996.

                                Appendix - Page 31 of 31                              6770