Court Opinion

ID: 9702118
Source: CourtListenerOpinion
Date Created: 2023-08-25 22:55:38.397034+00
Date Added: 2024-06-11T18:21:33.863443
License: Public Domain

OPINION
MULALLY, Judge.
This appeal from summary judgment challenges the trial court’s determination that, as a matter of law, the topic of health insurance benefits for retired public employees is excluded from the scope of collective bargaining under the Minnesota Public Employment Labor Relations Act (PELRA). We affirm.
*246FACTS
Appellant Minnesota Teamsters Public and Law Enforcement Employees Union, Local No. 320 (Union) is the exclusive representative for essential employees and probation officers employed by respondent County of Washington (County). For several years in the past, the County provided medical and hospitalization insurance coverage for both current and retired union employees. As applied to the retired employees, the insurance was not a part of the collective bargaining agreements negotiated by the County and the Union.
In 1985, the County modified and limited its past practice of providing health insurance for retired employees. The Union demanded negotiation over the issue, which the County refused. The Union then brought this action, asking for a declaratory judgment that medical insurance for retired employees is a mandatory subject of bargaining under PELRA, as a “term and condition of employment.” On cross-motions for summary judgment, the trial court denied the Union’s motion, concluding that “health insurance benefits for retired persons is a non-negotiable item for collective bargaining.”
ISSUE
Do insurance benefits for retired public employees constitute “retirement contributions or benefits”?
ANALYSIS
Under PELRA, the public employer and the employees’ exclusive representative have a mutual obligation to meet and negotiate in good faith over “terms and conditions of employment.” Minn.Stat. § 179A.07, subd. 2 (1986). The statute defines “terms and conditions of employment” as “the hours of employment, the compensation therefor including fringe benefits except retirement contributions or benefits, and the employer’s personnel policies affecting the working conditions of the employees.” Id. § 179A.03, subd. 19 (emphasis added).
The Minnesota Supreme Court has previously determined that the express exclusion of “retirement contributions or benefits” demonstrates a legislative intent “to remove pension issues from the scope of permissible bargaining.” AFSCME Councils 6, 14, 65 and 96, AFL-CIO v. Sundquist, 338 N.W.2d 560, 576 (Minn.1983) (citing 1973 Minn. Laws ch. 635, § 6)). However, the AFSCME case involved only pension contributions. Id. at 564 (union challenged statute that increased public employees’ existing contributions to pension funds by 2%). Thus, although the supreme court made broad references to “all pension issues,” it did not have occasion to consider whether health insurance for retired employees is a pension issue.
In discussing legislative intent, the supreme court in AFSCME quoted the author of the 1973 amendment: “ ‘The purpose of the amendment is to take the negotiation of pension benefits out of the bill and preserve the present situation with regard to pension benefits and that is to keep them within the realm of the legislature.’ ” Id. at 576 (quoting Statement of Rep. Donald Moe, House Committee on Governmental Operations, (March 13, 1973)). The court also cited Moe’s explanation that “the exclusion was necessary to prevent the decentralized and discordant administration of public pensions, and to maintain legislative discretion over significant matters of budgetary policy.” Id. Appellant, however, argues that these concerns for cost, uniformity of benefit packages, and legislative control do not extend to health insurance for retired employees, which is nothing more than “a continuation of a fringe benefit that applies to all workers,” and which is provided through private insurance carriers, not the legislature.
Respondent cites AFSCME and statements made in 1987 by now-Senator Moe, arguing that these statements support the trial court’s ruling and the extension of AFSCME to health insurance for retired employees. In committee hearings on a bill that would amend the definition of “retirement contributions or benefits,” Senator Moe stated that the intent in 1973 had been “to exclude from consideration any retirement benefit.” Statement of Sen. Donald *247Moe, Senate Committee on Government Operations, (April 28, 1987). Referring to the present case, Senator Moe stated that “in my opinion, the Washington County decision was appropriate.” Id.
The amendment proposed in 1987 would change the statute so that, in the future, “retirement contributions or benefits” would not include “insurance benefits paid for by public employers on behalf of retired employees up to age 65.” H.F. 257, 75th Sess. at 1 (Minn.1987). Thus, such insurance benefits would constitute a term or condition of employment and would be subject to collective bargaining. Although both legislative chambers passed the bill during the 1986-87 session, the senate and house bills differed, and the legislature adjourned without taking final action on the bill. Thus, whether the trial court’s decision in this ease will be legislatively overruled is still an open question.
The parties argue the importance of an earlier Washington County case, decided in March 1984, and involving the City of Still-water against appellant and AFSCME, Local # 517, on the issue of whether medical benefits for retired employees is a negotiable item. There, the court concluded that the supreme court’s decision in AFSCME did not specifically address the issue, and that AFSCME’s holding that “pension” benefits are excluded from bargaining did not compel a finding that medical/hospital benefits are precluded. In support, the court cited Incorporated Village of Lynbrook v. New York State Public Employment Relations Board, 48 N.Y.2d 398, 423 N.Y.S.2d 466, 399 N.E.2d 55 (1979).
The trial court in the present case distinguished Lynbrook, on the grounds that the New York court was applying a definition involving the negotiation of insurance benefits for dependents of employees both before and after retirement, while this case involves benefits solely for retired employees. The court also noted that the New York court stated that the legislative history provided little guidance, while here there is significant legislative history.
The trial court instead supported its conclusion by citing AFSCME and the supreme court’s reliance in AFSCME on a 1982 Iowa case. See City of Mason City v. Public Employment Relations Board, 316 N.W.2d 851 (Iowa 1982). In that case, the relevant statute excluded “all retirement systems” from the scope of collective bargaining. Id. at 853. When the union proposed health insurance for retired employees as a mandatory topic of negotiation, the Iowa Supreme Court held that the statute excluded from negotiations “any proposal that directly augments or supplements the benefits a public employee would receive under a retirement system under the other provisions of the [Iowa statutes].” Id. at 854. The court concluded that any other interpretation “would ignore and work to defeat a strong public policy underlying uniform retirement systems and pensions for public employees in this state.” Id. Similarly, the Minnesota Supreme Court in AFSCME identified policy considerations that support the prohibition against negotiations concerning pension systems. See AFSCME, 338 N.W.2d at 576 (citing the need to permit employers to contain the rising cost of pension benefits, the importance of legislative participation in the making of significant government policy, and the promotion of uniformity and the prevention of the existence of disparate benefits between different funds based upon the skill and success of employees’ bargaining representatives).
We conclude the trial court properly determined that the statute in its present form excludes health insurance benefits for retired persons from the scope of collective bargaining in the public sector. We reach this conclusion because the evidence on legislative intent demonstrates the purpose of excluding all retirement benefits from the scope of collective bargaining, and because the plain language of the statute reasonably supports the trial court’s interpretation of the meaning of “retirement contributions and benefits.” We also observe that the statute, bargaining proposal, and standard of review in the Lynbrook case were significantly different from those in this case, and we hold that in making its *248determination, the trial court appropriately-distinguished Lynbrook. In our opinion the trial court properly applied the statute consistent with its language and present legislative intent.
DECISION
Affirmed.
CRIPPEN, J., dissents.