City of Long Beach (PERB 2296M)

STATE OF CALIFORNIA
DECISION OF THE
PUBLIC EMPLOYMENT RELATIONS BOARD
INTERNATIONAL ASSOCIATION OF
MACHINISTS & AERO SP ACE WORKERS,
LOCAL LODGE 1930, DISTRICT 947,
Charging Party,
V.
CITY OF LONG BEACH,
Respondent.
Case No. LA-CE-537-M
PERB Decision No. 2296-M
December 4, 2012
Appearances: Holguin, Garfield, Martinez & Quinonez by Dana S. Martinez, Attorney,
for International Association of Machinists & Aerospace Workers, Local Lodge 1930,
District 947; Atkinson, Andelson, Loya, Ruud & Romo by Nate J. Kowalski, Attorney,
for City of Long Beach.
Before Martinez, Chair; Dowdin Calvillo and Huguenin,Members.
DECISION
DOWDIN CALVILLO, Member: This case is before the Public Employment Relations
Board (PERB or Board) on exceptions filed by the City of Long Beach (City) to the proposed
decision of an administrative law judge (ALJ). The complaint alleged that the City violated
the Meyers-Milias-Brown Act (MMBA) 1 by unilaterally implementing a five-day furlough on
employees represented by the International Association of Machinists & Aerospace Workers,
Local Lodge 1930, District 94 7 (IAM), without satisfying its obligation to meet and confer in
good faith. 	The ALJ found that the City violated 	MMBA by unilaterally implementing the
furloughs. 	For the reasons set forth below, we affirm the 	s determination.
1 The MMBA is codified at Government Code section 3500 et seq. Unless otherwise
noted, all statutory references are to the Government Code.
STATE OF CALIFORNIA
DECISION OF THE
PUBLIC EMPLOYMENT RELATIONS BOARD
INTERNATIONAL ASSOCIATION OF
MACHINISTS & AEROSPACE WORKERS,
LOCAL LODGE 1930, DISTRICT 947,
Charging Party, 	Case No. LA-CE-537-M
V. 	PERB Decision No. 2296-M
CITY OF LONG BEACH, 	December 4, 2012
Respondent.
Appearances: Holguin, Garfield, Martinez & Quinonez by Dana S. Martinez, Attorney,
for International Association of Machinists & Aerospace Workers, Local Lodge 1930,
District 947; Atkinson, Andelson, Loya, Ruud & Romo by Nate J. Kowalski, Attorney,
for City of Long Beach.
Before Martinez, Chair; Dowdin Calvillo and Huguenin, Members.
DECISION
DOWDIN CALVILLO, Member: This case is before the Public Employment Relations
Board (PERB or Board) on exceptions filed by the City of Long Beach (City) to the proposed
decision of an administrative law judge (ALD). The complaint alleged that the City violated
the Meyers-Milias-Brown Act (MMBA)' by unilaterally implementing a five-day furlough on
employees represented by the International Association of Machinists & Aerospace Workers,
Local Lodge 1930, District 947 (IAM), without satisfying its obligation to meet and confer in
good faith. The ALJ found that the City violated the MMBA by unilaterally implementing the
furloughs. For the reasons set forth below, we affirm the ALJ's determination.
The MMBA is codified at Government Code section 3500 et seq. Unless otherwise
noted, all statutory references are to the Government Code.

FACTUAL SUMMARY
At all relevant times, the City and IAM were parties to a memorandum of
understanding (MOU) governing the terms and conditions of employment of five bargaining
units of City employees. 2 Article VI, Section XIII of the MOU lists three work schedule
alternatives, each totaling 40 hours per week: a 5/40 schedule defined as working five eight-
hour days Monday through Friday; a 9/80 schedule defined as eight nine-hour days and one
eight-hour day in a two week pay period; and a 4/10 work schedule defined as four ten-hour
days each week. 3 Section A.4 of Section XIII permits the City to approve other work
schedules, and provides:
Other work schedule alternatives may be approved by the City
Manager or the appropriate appointing authority, if it is
determined to be operationally advantageous and does not exceed
forty ( 40) hours of scheduled work in the defined FLSA work
week. Other approved work schedules shall not reduce service to
the public, departmental effectiveness, productivity and/or
efficiency or increase overall City costs as determined by the City
Manager or the appropriate appointing authority.
Section B of Section XIII provides:
Alternative Work Schedules (work schedules other than the
traditional 5/40 work schedule) must be approved by the City
Manager or the appropriate appointing authority.
addition, Article I, Section VII of the MOU provides:
It is understood and agreed that there exists within the City, in
written form, Personnel Policies and Procedures and
Departmental Rules and Regulations. Except as specifically
modified by this MOU, these rules, regulations, and Policies and
Procedures, and any subsequent amendments thereto, shall be in
full force and effect during the term of this MOU.
The units are: Refuse, Skilled and General, Office and Technical, Professional, and
Protection.
3 Each of the defined schedules includes a one-hour lunch, unless a shorter lunch period
is approved by the City Manager or appropriate appointing authority.
2
FACTUAL SUMMARY
At all relevant times, the City and IAM were parties to a memorandum of
understanding (MOU) governing the terms and conditions of employment of five bargaining
units of City employees." Article VI, Section XIII of the MOU lists three work schedule
alternatives, each totaling 40 hours per week: a 5/40 schedule defined as working five eight-
hour days Monday through Friday; a 9/80 schedule defined as eight nine-hour days and one
eight-hour day in a two week pay period; and a 4/10 work schedule defined as four ten-hour
days each week.' Section A.4 of Section XIII permits the City to approve other work
schedules, and provides:
Other work schedule alternatives may be approved by the City
Manager or the appropriate appointing authority, if it is
determined to be operationally advantageous and does not exceed
forty (40) hours of scheduled work in the defined FLSA work
week. Other approved work schedules shall not reduce service to
the public, departmental effectiveness, productivity and/or
efficiency or increase overall City costs as determined by the City
Manager or the appropriate appointing authority.
Section B of Section XIII provides:
Alternative Work Schedules (work schedules other than the
traditional 5/40 work schedule) must be approved by the City
Manager or the appropriate appointing authority.
In addition, Article I, Section VII of the MOU provides:
It is understood and agreed that there exists within the City, in
written form, Personnel Policies and Procedures and
Departmental Rules and Regulations. Except as specifically
modified by this MOU, these rules, regulations. and Policies and
Procedures. and any subsequent amendments thereto. shall be in
full force and effect during the term of this MOU. Before any
The units are: Refuse, Skilled and General, Office and Technical, Professional, and
Protection.
Each of the defined schedules includes a one-hour lunch, unless a shorter lunch period
is approved by the City Manager or appropriate appointing authority.
2

new or subsequent amendments to these Personnel Policies and
Procedures or Departmental Rules and Regulations, directly
affecting wages, hours, and terms and conditions
of
employment
are implemented, the City shall meet with the Union regarding
the changes in accordance with Government Code Sections 3500
et seq. Per Government Code section 3505, meet and confer in
good faith means that a public agency, or such representatives as
it may designate, and representatives
of
recognized employee
organizations, shall have the mutual obligation personally to meet
and confer promptly upon request by either party and continue for
a reasonable period
of
time in order to exchange freely
information, opinions, and proposals, and to endeavor to reach
agreement on matters within the scope
of
representation. Nothing
provided herein shall prevent the City from implementing rules
and regulations provided it has met with the Union as required by
law. Employee wages and fringe benefits will not be reduced
unless agreed to by the Union.
(Emphasis added.)
No document entitled "Personnel Policies and Procedures" or "Departmental Rules and
Regulations" was introduced into evidence at the hearing. The parties did introduce, however,
the City's Civil Service Rules and Regulations (CSRRs) adopted under the City Charter.
Section 92
of
the CSRRs authorizes the City to lay
off
or reduce the hours
of
employees for
reasons
of
economy or due to a lack
of
work or funds, and provides, in relevant part:
For reasons
of
economy or due to a lack
of
work or fonds, an
appointing authority may reorganize or eliminate any department,
bureau, or division, or may abolish any position under its direct
jurisdiction, and/or reduce the number of, or the hours worked by
City employees
....
Beginning in mid-2008, the City began to experience significant shortfalls in revenues.
On July 1, 2008, the City Manager issued a budget message projecting a $16.9 million
structural budget deficit for the fiscal year 2008-2009.4 In August 2008, the City Council
approved a budget with substantial cuts in order to address the deficit. However, as the fiscal
year progressed, the City determined that, consistent with general economic conditions
The City's fiscal year runs from October 1 through September 30.
3
new or subsequent amendments to these Personnel Policies and
Procedures or Departmental Rules and Regulations, directly
affecting wages, hours, and terms and conditions of employment
are implemented, the City shall meet with the Union regarding
the changes in accordance with Government Code Sections 3500
et seq. Per Government Code section 3505, meet and confer in
good faith means that a public agency, or such representatives as
it may designate, and representatives of recognized employee
organizations, shall have the mutual obligation personally to meet
and confer promptly upon request by either party and continue for
a reasonable period of time in order to exchange freely
information, opinions, and proposals, and to endeavor to reach
agreement on matters within the scope of representation. Nothing
provided herein shall prevent the City from implementing rules
and regulations provided it has met with the Union as required by
law. Employee wages and fringe benefits will not be reduced
unless agreed to by the Union.
(Emphasis added.)
No document entitled "Personnel Policies and Procedures" or "Departmental Rules and
Regulations" was introduced into evidence at the hearing. The parties did introduce, however,
the City's Civil Service Rules and Regulations (CSRRs) adopted under the City Charter.
Section 92 of the CSRRs authorizes the City to lay off or reduce the hours of employees for
reasons of economy or due to a lack of work or funds, and provides, in relevant part:
For reasons of economy or due to a lack of work or funds, an
appointing authority may reorganize or eliminate any department,
bureau, or division, or may abolish any position under its direct
urisdiction, and/or reduce the number of, or the hours worked by	j
City employees. . . .
Beginning in mid-2008, the City began to experience significant shortfalls in revenues.
On July 1, 2008, the City Manager issued a budget message projecting a $16.9 million
structural budget deficit for the fiscal year 2008-2009.* In August 2008, the City Council
approved a budget with substantial cuts in order to address the deficit. However, as the fiscal
year progressed, the City determined that, consistent with general economic conditions
# The City's fiscal year runs from October 1 through September 30.
3

prevailing at the time, its economic situation had become worse and that further cuts
were
necessary.
In a memo to the City Manager dated October 23, 2008, the City's Director
of
Financial
Management, Lori Ann Farrell (Farrell), described the general economic downturn as
"a
crisis
impacting all sectors
of
the economy" and asserts that the City's revenues "will continue to be
negatively impacted by the economic downturn and this recent global crisis." The
memorandum further states that several measures would be implemented immediately to
address the City's budget concerns. The memo further states:
A mandatory five-day employee furlough will be explored. It
is estimated that a one-week furlough on non-public safety and
non-critical employees would save approximately $700,000 -
$900,000 in the General Fund in FY 09. 	While this action is
certainly a meet-and-confer issue with the employee bargaining
units, and would represent an approximately 2 percent salary
reduction for participating employees, we hope for the full
cooperation
of
all unions in finding a unified solution to our
current challenges.
(Underlining added; bold in original.)
The City and IAM met on January 29, February 19, February 26, and March 5, 2009 to
discuss cost savings options for the 2008-2009 fiscal year. 	Both furloughs and layoffs were
among the options discussed. The parties also discussed other cost savings ideas obtained by
IAM from its members. No agreement was reached. The City did not declare impasse and did
not present a last, best and final offer to IAM.
By memorandum dated March 4, 2009, Farrell advised the City Manager, the Mayor,
and the City Council that the estimated budget deficit was now $20 million. 	Regarding
furloughs, the memorandum stated:
With the significant financial challenges the City is facing, we are
planning on implementing a five-day (40 hours) employee
furlough during the current fiscal year, which is estimated to
4
prevailing at the time, its economic situation had become worse and that further cuts were
necessary.
In a memo to the City Manager dated October 23, 2008, the City's Director of Financial
Management, Lori Ann Farrell (Farrell), described the general economic downturn as "a crisis
impacting all sectors of the economy" and asserts that the City's revenues "will continue to be
negatively impacted by the economic downturn and this recent global crisis." The
memorandum further states that several measures would be implemented immediately to
address the City's budget concerns. The memo further states:
A mandatory five-day employee furlough will be explored. It
is estimated that a one-week furlough on non-public safety and
non-critical employees would save approximately $700,000 -
$900,000 in the General Fund in FY 09. While this action is
certainly a meet-and-confer issue with the employee bargaining
units, and would represent an approximately 2 percent salary
reduction for participating employees. we hope for the full
cooperation of all unions in finding a unified solution to our
current challenges.
(Underlining added; bold in original.)
The City and IAM met on January 29, February 19, February 26, and March 5, 2009 to
discuss cost savings options for the 2008-2009 fiscal year. Both furloughs and layoffs were
among the options discussed. The parties also discussed other cost savings ideas obtained by
IAM from its members. No agreement was reached. The City did not declare impasse and did
not present a last, best and final offer to IAM.
By memorandum dated March 4, 2009, Farrell advised the City Manager, the Mayor,
and the City Council that the estimated budget deficit was now $20 million. Regarding
furloughs, the memorandum stated:
With the significant financial challenges the City is facing, we are
planning on implementing a five-day (40 hours) employee
furlough during the current fiscal year, which is estimated to

generate approximately $4 million in savings to the General
Fund. The furlough will likely take place the last Friday
of
the
month from May to September in the current year. We will make
sure the public is well-informed in advance
of
the planned
closures so that they can plan accordingly. We are still
evaluating an effective approach to implementing furloughs with
our public safety personnel, or other alternatives that will
generate equivalent savings, while maintaining the safety
of
the
community. 	We have met with all employee associations to
discuss furloughs and will continue to welcome further discussion
with the Unions
of
alternatives that would achieve the same
savings in the current fiscal year. We will continue to keep the
City Council informed prior to implementation
of
these cost-
savmg measures.
Attached to the March 4, 2009 memorandum is a letter to all City employees advising
them that the City will likely implement both employee layoffs and the five-day furlough
by
the end
of
the fiscal year. 5 According to Farrell, it was necessary to implement the furloughs
no later than May 2009 in order to minimize the impact on the community and the employees
by having the furloughs spread out over five months rather than a shorter time period.
IAM and the City met again on April 9, 2009. The parties discussed the impact
of
the
furloughs on the need for layoffs, overtime, health benefits, and leave time. IAM made several
proposals on how the furloughs should be implemented, in the event IAM agreed to them.
During the meeting, the City informed IAM that it had begun the process
of
implementing
furloughs and that it would be recommending that the City Council vote to go forward
with its
plan
of
implementing five furlough days on the last Friday
of
each month from May through
October 2009. The parties agreed to continue to discuss alternatives, however, and scheduled
another meeting for May 7, 2009.
In an e-mail dated April 22, 2009, IAM Chief Spokesman Ray Rivera (Rivera) notified
City Human Resource Director Suzanne Mason (Mason) that IAM understood that the City
5 The record does not indicate whether that letter was ever sent to the employees.
5
generate approximately $4 million in savings to the General
Fund. The furlough will likely take place the last Friday of the
month from May to September in the current year. We will make
sure the public is well-informed in advance of the planned
closures so that they can plan accordingly. We are still
evaluating an effective approach to implementing furloughs with
our public safety personnel, or other alternatives that will
generate equivalent savings, while maintaining the safety of the
community. We have met with all employee associations to
discuss furloughs and will continue to welcome further discussion
with the Unions of alternatives that would achieve the same
savings in the current fiscal year. We will continue to keep the
City Council informed prior to implementation of these cost-
saving measures.
Attached to the March 4, 2009 memorandum is a letter to all City employees advising
them that the City will likely implement both employee layoffs and the five-day furlough by
the end of the fiscal year. According to Farrell, it was necessary to implement the furloughs
no later than May 2009 in order to minimize the impact on the community and the employees
by having the furloughs spread out over five months rather than a shorter time period.
IAM and the City met again on April 9, 2009. The parties discussed the impact of the
furloughs on the need for layoffs, overtime, health benefits, and leave time. IAM made several
proposals on how the furloughs should be implemented, in the event IAM agreed to them.
During the meeting, the City informed IAM that it had begun the process of implementing
furloughs and that it would be recommending that the City Council vote to go forward with its
plan of implementing five furlough days on the last Friday of each month from May through
October 2009. The parties agreed to continue to discuss alternatives, however, and scheduled
another meeting for May 7, 2009.
In an e-mail dated April 22, 2009, IAM Chief Spokesman Ray Rivera (Rivera) notified
City Human Resource Director Suzanne Mason (Mason) that IAM understood that the City
The record does not indicate whether that letter was ever sent to the employees.

Council would be voting to
go
forward with the City's furlough plan at its meeting on May
5,
2009. Rivera noted that the parties had a meeting scheduled for two days later, on May 7,
2009, but questioned the utility
of
the meeting since the City was going forward with the
furloughs. 	Rivera notified Mason that IAM was going to file an unfair practice charge over the
furloughs.
Mason responded to Rivera on April 23, 2009 and stated that, while the City remained
open to continue to meet to discuss employee-generated alternatives to furloughs, and that the
meeting on May 7 would be an opportunity to do so, it was going to have to move forward
with furloughs
if
there were no alternatives to negotiate. The e-mail further stated, "At this
point reduced work hours is the only alternative available to the City Manager to generate the
needed General Fund savings by $4 million and $7.2 million Citywide. 	We will remain
available to discuss alternatives with all Unions and the City Council letter will say so. 	As
with the State
of
CA and the SEIU, negotiated alternatives can follow implementation."
On May
5,
2009, following the formal recommendation
of
City Manager Patrick West
(West), the City Council authorized the implementation
of
a mandatory unpaid furlough
of
40
hours for regular, fuH-time employees. 	West further recommended that the City continue to
meet with union representatives to explore cost-saving measures. The resolution provides, in
relevant part:
NOW,
THEREFORE, the
City Council of
the
City of Long Beach
resolves as follows:
Section
1.
	Employee work furloughs equivalent to 1.92 percent
of
annual salary (i.e., 40 hours of unpaid time off for a regular
full time employee) be implemented which may result in service
reductions and possible City business closures in order to
generate needed savings.
6
Council would be voting to go forward with the City's furlough plan at its meeting on May 5,
2009. Rivera noted that the parties had a meeting scheduled for two days later, on May 7,
2009, but questioned the utility of the meeting since the City was going forward with the
furloughs. Rivera notified Mason that IAM was going to file an unfair practice charge over the
furloughs.
Mason responded to Rivera on April 23, 2009 and stated that, while the City remained
open to continue to meet to discuss employee-generated alternatives to furloughs, and that the
meeting on May 7 would be an opportunity to do so, it was going to have to move forward
with furloughs if there were no alternatives to negotiate. The e-mail further stated, "At this
point reduced work hours is the only alternative available to the City Manager to generate the
needed General Fund savings by $4 million and $7.2 million Citywide. We will remain
available to discuss alternatives with all Unions and the City Council letter will say so. As
with the State of CA and the SEIU, negotiated alternatives can follow implementation."
On May 5, 2009, following the formal recommendation of City Manager Patrick West
(West), the City Council authorized the implementation of a mandatory unpaid furlough of 40
hours for regular, full-time employees. West further recommended that the City continue to
meet with union representatives to explore cost-saving measures. The resolution provides, in
relevant part:
NOW, THEREFORE, the City Council of the City of Long Beach
resolves as follows:
Section 1. Employee work furloughs equivalent to 1.92 percent
of annual salary (i.e., 40 hours of unpaid time off for a regular
full time employee) be implemented which may result in service
reductions and possible City business closures in order to
generate needed savings.

Work furloughs may not be required in the event alternative
equivalent employee generated savings are negotiated with a
labor organization.
Under the furlough plan, some departments implemented business closure days, while
others required employees to take a "floating" unpaid furlough day
of
eight hours per month.
The City's Harbor Department utilized the floating furlough day. Many employees in that
department, however, worked a "9/80" schedule, such that they worked eight nine-hour days
and one eight-hour day over a two-week period. For those employees, the City required
employees who took their furlough day on what would have been a nine-hour day to use
accrued leave, such as vacation, for the extra hour. This requirement was not discussed during
the meetings between IAM and the City and was not included in the City Council's May 5,
2009 resolution. In addition, at least 88 employees were granted permission to take "floating"
furloughs, rather than one day per month.
On July 21, 2009, the City Council adopted a resolution declaring a fiscal emergency.
ALJ' S PROPOSED DECISION
The ALJ determined that the City unlawfully implemented two furlough policies: 	one
requiring furloughs
of
one eight-hour day per month and one requiring Harbor Department
employees to use accrued leave to make up the extra hour on nine-hour work days. The ALJ
determined that the unilateral changes were not authorized by former MMBA section 3505.46
because the City never made a last, best and final offer and never declared impasse. The ALJ
rejected the City's argument that the changes were authorized by the parties' MOU and that the
City had the legal authority to implement them in response to a fiscal emergency under MMBA
section 3504.5.
Former MMBA section 3505.4 was repealed effective January 1, 2012. (AB 646,
2011 Stats. Ch. 680, § 1.)
7
Work furloughs may not be required in the event alternative
equivalent employee generated savings are negotiated with a
labor organization.
Under the furlough plan, some departments implemented business closure days, while
others required employees to take a "floating" unpaid furlough day of eight hours per month.
The City's Harbor Department utilized the floating furlough day. Many employees in that
department, however, worked a "9/80" schedule, such that they worked eight nine-hour days
and one eight-hour day over a two-week period. For those employees, the City required
employees who took their furlough day on what would have been a nine-hour day to use
accrued leave, such as vacation, for the extra hour. This requirement was not discussed during
the meetings between IAM and the City and was not included in the City Council's May 5,
2009 resolution. In addition, at least 88 employees were granted permission to take "floating"
furloughs, rather than one day per month.
On July 21, 2009, the City Council adopted a resolution declaring a fiscal emergency.
ALJ'S PROPOSED DECISION
The ALJ determined that the City unlawfully implemented two furlough policies: one
requiring furloughs of one eight-hour day per month and one requiring Harbor Department
employees to use accrued leave to make up the extra hour on nine-hour work days. The ALJ
determined that the unilateral changes were not authorized by former MMBA section 3505.46
because the City never made a last, best and final offer and never declared impasse. The ALJ
rejected the City's argument that the changes were authorized by the parties' MOU and that the
City had the legal authority to implement them in response to a fiscal emergency under MMBA
section 3504.5.
Former MMBA section 3505.4 was repealed effective January 1, 2012. (AB 646,
2011 Stats. Ch. 680, $ 1.)

THE CITY'S EXCEPTIONS
The City excepts to the following determinations by the ALJ:
1. 	Nothing specifically titled "Personnel Policies and Procedures" or
"Departmental Rules and Regulations" was admitted into evidence.
2. 	The City never made a last, best and final offer and never declared impasse.
3. 	The City unilaterally implemented two furlough policies that were not
authorized by MMBA section 3505 because the City never made a last, best and final offer and
never declared impasse.
4. 	Section 92 of the City's CSRRs was not incorporated by reference into the
parties' MOU.
5. 	There was no clear and unmistakable waiver of the right to bargain over
furloughs.
6. 	The City did not prove a financial emergency in May 2009 when it implemented
the furlough policies.
7. 	The City did not prove that it had no alternatives to furloughs.
8. 	The City violated the MMBA by unilaterally and unlawfully implementing two
furlough policies.
9. 	It is appropriate to order the City to cease and desist from implementing
furloughs, to rescind the furlough resolution of May 5, 2009, and to make affected employees
whole.
The City made the. following arguments in support of its exceptions to the ALJ' s
proposed decision:
1. 	The City's CSRRs were incorporated into the parties' MOU and permitted the
City to unilaterally impose furloughs.
8
THE CITY'S EXCEPTIONS
The City excepts to the following determinations by the ALJ:
Nothing specifically titled "Personnel Policies and Procedures" or
"Departmental Rules and Regulations" was admitted into evidence.
The City never made a last, best and final offer and never declared impasse.
The City unilaterally implemented two furlough policies that were not
authorized by MMBA section 3505 because the City never made a last, best and final offer and
never declared impasse.
Section 92 of the City's CSRRs was not incorporated by reference into the
parties' MOU.
There was no clear and unmistakable waiver of the right to bargain over
furloughs.
The City did not prove a financial emergency in May 2009 when it implemented
the furlough policies.
The City did not prove that it had no alternatives to furloughs.
The City violated the MMBA by unilaterally and unlawfully implementing two
furlough policies.
It is appropriate to order the City to cease and desist from implementing
furloughs, to rescind the furlough resolution of May 5, 2009, and to make affected employees
whole.
The City made the following arguments in support of its exceptions to the ALJ's
proposed decision:
The City's CSRRs were incorporated into the parties' MOU and permitted the
City to unilaterally impose furloughs.

2. 	The City Council exercised the necessary express authority for the City to
implement the temporary furloughs.
3. 	A fiscal emergency authorized the imposition
of
furloughs under MMBA
section 3504.5.
4. 	The decision to implement furloughs was authorized by waiver pursuant to the
management rights clause contained in the parties' MOU.
5. 	The City exhausted its bargaining obligations under former MMBA
section 3 505 .4 prior to the imposition
of
furloughs.
IAM' S RESPONSE
IAM agrees with all
of
the
ALJ's
conclusions and argues:
1. 	The City's CSRRs do not permit the reduction
of
hours in the form
of
furloughs.
2. 	The City Council did not have express authority to unilaterally implement
furloughs.
3. 	There was no fiscal emergency that authorized the unilateral imposition
of
furloughs.
4. 	The City's management rights clause does not authorize the unilateral
imposition
of
furloughs.
5. 	The City failed to exhaust its bargaining obligations.
ISSUE
Did the City violate its duty to meet and confer under MMBA section 3505 when it
implemented a five-day employee furlough policy on May 5, 2009?
9
The City Council exercised the necessary express authority for the City to
implement the temporary furloughs.
A fiscal emergency authorized the imposition of furloughs under MMBA
section 3504.5.
The decision to implement furloughs was authorized by waiver pursuant to the
management rights clause contained in the parties' MOU.
The City exhausted its bargaining obligations under former MMBA
section 3505.4 prior to the imposition of furloughs.
IAM'S RESPONSE
IAM agrees with all of the ALJ's conclusions and argues:
The City's CSRRs do not permit the reduction of hours in the form of furloughs.
The City Council did not have express authority to unilaterally implement
furloughs.
There was no fiscal emergency that authorized the unilateral imposition of
furloughs.
The City's management rights clause does not authorize the unilateral
imposition of furloughs.
The City failed to exhaust its bargaining obligations.
ISSUE
Did the City violate its duty to meet and confer under MMBA section 3505 when it
implemented a five-day employee furlough policy on May 5, 2009?

DISCUSSION
Supplemental Briefing
The ALJ issued his proposed decision on June
1,
2012. On June 26, 2012, the City
filed its exceptions to the ALJ's proposed decision. On July
5,
2012, IAM requested an
extension
of
time until July 27, 2012 within which to respond to the City's exceptions.7 The
PERB Appeals Assistant granted that request on July 6, 2012. On July 19, 2012, the City
submitted a supplemental brief in support
of
its exceptions, requesting that the Board consider
the decision
of
the California Supreme Court issued on July 2, 2012 in State Building
and
Construction Trades Council
of
California
v.
City
of
Vista (2012) 54 Cal.4th 54 7 (City
of
Vista). 	On July 27, 2012, IAM filed both a supporting brief and response to the City's
exceptions and a response to the City's supplemental brief in support
of
its exceptions.
IAM contends that the City's supplemental brief was not timely filed and should not be
considered. We view the City's supplemental brief as a request to reopen the record to admit
new authority. When considering a request to reopen the record to admit new evidence, the
Board applies the standard set forth in PERB Regulation 32410(a) for a request for
reconsideration based on the discovery
of
new evidence. (State
of
California (Department
of
Parks and Recreation) (1995) PERB Decision No. 1125-S.) The regulation provides, in
relevant part:
A request for reconsideration based upon 	discovery
of
new
evidence must be supported by a declaration under the penalty of
perjury which establishes that the evidence: (1) was not
previously available; (2) could not have been discovered prior to
the 	with 	of reasonable 	(3) was
7 On July 11, 2012, the City filed a request for oral argument. ThePERB
Appeals Assistant denied that request as untimely on July 18, 2012, pursuant to PERB
Regulation 32315 (requiring request for oral argument to be filed with the statement of
exceptions.) The City has not appealed from that determination. (PERB Regulations are
codified at Cal. Code Regs., tit. 8, § 31001 et seq.)
10
DISCUSSION
Supplemental Briefing
The ALJ issued his proposed decision on June 1, 2012. On June 26, 2012, the City
filed its exceptions to the ALJ's proposed decision. On July 5, 2012, IAM requested an
extension of time until July 27, 2012 within which to respond to the City's exceptions.' The
PERB Appeals Assistant granted that request on July 6, 2012. On July 19, 2012, the City
submitted a supplemental brief in support of its exceptions, requesting that the Board consider
the decision of the California Supreme Court issued on July 2, 2012 in State Building and
Construction Trades Council of California v. City of Vista (2012) 54 Cal.4th 547 (City of
Vista). On July 27, 2012, IAM filed both a supporting brief and response to the City's
exceptions and a response to the City's supplemental brief in support of its exceptions.
IAM contends that the City's supplemental brief was not timely filed and should not be
considered. We view the City's supplemental brief as a request to reopen the record to admit
new authority. When considering a request to reopen the record to admit new evidence, the
Board applies the standard set forth in PERB Regulation 32410(a) for a request for
reconsideration based on the discovery of new evidence. (State of California (Department of
Parks and Recreation) (1995) PERB Decision No. 1125-S.) The regulation provides, in
relevant part:
A request for reconsideration based upon the discovery of new
evidence must be supported by a declaration under the penalty of
perjury which establishes that the evidence: (1) was not
previously available; (2) could not have been discovered prior to
the hearing with the exercise of reasonable diligence; (3) was
"On July 11, 2012, the City filed a request for oral argument. The
Appeals Assistant denied that request as untimely on July 18, 2012, pursuant to PERB
Regulation 32315 (requiring request for oral argument to be filed with the statement of
exceptions.) The City has not appealed from that determination. (PERB Regulations are
codified at Cal. Code Regs., tit. 8, $ 31001 et seq.)
10

submitted within a reasonable time of its discovery; (4) is
relevant to the issues sought to be reconsidered; and ( 5) impacts
or alters the decision of the previously decided case.
We apply the same standard to the City's request to reopen the record to consider new
legal authority. The new legal authority consists of a case decided by the California Supreme
Court on July 2, 2012, six days after the City filed its exceptions and supporting brief.
Therefore, the authority was not previously available, nor could it have been discovered prior
to submission of the exceptions with the exercise of reasonable diligence. The City's request
was submitted within a reasonable time after issuance of the Supreme Court decision. While,
as noted below, we do not find the decision persuasive on the issues before us, it has some
relevance to the issue of whether the CSRRs authorized the City to implement furloughs
without complying with the meet and confer obligations of the MMBA. Because this case is
not before us on a request for reconsideration, we do not find the fifth factor relevant to the
issue of whether the record should be reopened to receive new legal authority. Accordingly,
we find good cause to accept the City's supplemental brief.8
Unilateral Change
The charge aileges that, by unilaterally imposing furloughs, the County vioiated its duty
to meet and confer in good faith as required under the MMBA. An employer's unilateral
change in terms and conditions of employment constitutes a "per se" violation of its duty to
bargain in good faith when: 	(1) the employer breached or altered the parties' written
agreement or its own established past practice; (2) such action was taken without giving the
other party notice or an opportunity to bargain over the change; (3) the change was not merely
In its response to the supplemental brief, IAM requested additional time to respond to
the arguments raised therein in the event PERB accepts the City's supplemental brief. In light
of our determination, infra, that the legal authority identified in the supplemental brief is
inapplicable to this case, we find further briefing unnecessary.
11
submitted within a reasonable time of its discovery; (4) is
relevant to the issues sought to be reconsidered; and (5) impacts
or alters the decision of the previously decided case.
We apply the same standard to the City's request to reopen the record to consider new
legal authority. The new legal authority consists of a case decided by the California Supreme
Court on July 2, 2012, six days after the City filed its exceptions and supporting brief.
Therefore, the authority was not previously available, nor could it have been discovered prior
to submission of the exceptions with the exercise of reasonable diligence. The City's request
was submitted within a reasonable time after issuance of the Supreme Court decision. While,
as noted below, we do not find the decision persuasive on the issues before us, it has some
relevance to the issue of whether the CSRRs authorized the City to implement furloughs
without complying with the meet and confer obligations of the MMBA. Because this case is
not before us on a request for reconsideration, we do not find the fifth factor relevant to the
issue of whether the record should be reopened to receive new legal authority. Accordingly,
we find good cause to accept the City's supplemental brief.
Unilateral Change
The charge alleges that, by unilaterally imposing furloughs, the County violated its duty
to meet and confer in good faith as required under the MMBA. An employer's unilateral
change in terms and conditions of employment constitutes a "per se" violation of its duty to
bargain in good faith when: (1) the employer breached or altered the parties' written
agreement or its own established past practice; (2) such action was taken without giving the
other party notice or an opportunity to bargain over the change; (3) the change was not merely
In its response to the supplemental brief, IAM requested additional time to respond to
the arguments raised therein in the event PERB accepts the City's supplemental brief. In light
of our determination, infra, that the legal authority identified in the supplemental brief is
inapplicable to this case, we find further briefing unnecessary.
11

an isolated breach of the contract, but amounts to a change in policy (i.e., it has a generalized
effect or continuing impact upon bargaining unit members' terms and conditions of
employment); and (4) the change in policy concerns a matter within the scope of
representation. (Vernon Fire Fighters v. City of Vernon (1980) 107 Cal.App.3d 802;
San Joaquin County Employees Assn. v. City of Stockton (1984) 161 Cal.App.3d 813;
Grant Joint Union High School District (1982) PERB Decision No. 196 (Grant);
Walnut Valley Unified School District (1981) PERB Decision No. 160.)
1. 	Breach or Alteration of Written Agreement or Past Practice
To prevail in a unilateral change case, the charging party must first establish that the
employer breached or altered the parties' written agreement or an established past practice.
(Grant, supra, PERB Decision No. 196.) However, an employer does not make a unlawful
change if its actions conform to the terms of the parties' agreement. (Marysville Joint Unified
School District (1983) PERB Decision No. 314; County of Ventura (Office of Agricultural
Commissioner) (2011) PERB Decision No. 2227-M.)
Prior to May 5, 2009, the City's employees were subject to 40-hour workweek and
were not furloughed. 	After May 5, 2009, the City changed this practice to furlough employees
one day per month for five months. Therefore, at its most basic level, the first element of a
prima facie case of unilateral change has been established. The City contends, however, that
the CSRRs were incorporated into the parties' MOU by virtue of Article I, Section VII, and
that those provisions authorized the City to unilaterally implement furloughs. 	Thus, the City
appears to argue that its actions conformed to the terms of the parties' agreement, such that
there was no breach or alteration of a written agreement.
Article I, Section VII, provides that the City's written "Personnel Policies and
Procedures and Departmental Rules and Regulations," and any subsequent amendments
12
an isolated breach of the contract, but amounts to a change in policy (i.e., it has a generalized
effect or continuing impact upon bargaining unit members' terms and conditions of
employment); and (4) the change in policy concerns a matter within the scope of
representation. (Vernon Fire Fighters v. City of Vernon (1980) 107 Cal.App.3d 802;
San Joaquin County Employees Assn. v. City of Stockton (1984) 161 Cal.App.3d 813;
Grant Joint Union High School District (1982) PERB Decision No. 196 (Grant);
Walnut Valley Unified School District (1981) PERB Decision No. 160.)
1 . 	Breach or Alteration of Written Agreement or Past Practice
To prevail in a unilateral change case, the charging party must first establish that the
employer breached or altered the parties' written agreement or an established past practice.
(Grant, supra, PERB Decision No. 196.) However, an employer does not make a unlawful
change if its actions conform to the terms of the parties' agreement. (Marysville Joint Unified
School District (1983) PERB Decision No. 314; County of Ventura (Office of Agricultural
Commissioner) (2011) PERB Decision No. 2227-M.)
Prior to May 5, 2009, the City's employees were subject to 40-hour workweek and
were not furloughed. After May 5, 2009, the City changed this practice to furlough employees
one day per month for five months. Therefore, at its most basic level, the first element of a
prima facie case of unilateral change has been established. The City contends, however, that
the CSRRs were incorporated into the parties' MOU by virtue of Article I, Section VII, and
that those provisions authorized the City to unilaterally implement furloughs. Thus, the City
appears to argue that its actions conformed to the terms of the parties' agreement, such that
there was no breach or alteration of a written agreement.
Article I, Section VII, provides that the City's written "Personnel Policies and
Procedures and Departmental Rules and Regulations," and any subsequent amendments
12

thereto, "shall be in full force and effect during the term of this MOU." That section further
provides that the City shall meet and confer prior to implementing any changes in these
"Personnel Policies and Procedures or Departmental Rules and Regulations" directly affecting
wages, hours and terms and conditions of employment. Finally, the MOU provides that
employee wages and fringe benefits will not be reduced unless agreed to by IAM.
No documents.entitled "Personnel Policies and Procedures" or "Departmental Rules
and Regulations" were offered into evidence at the hearing before the ALJ. 	In addition, no
evidence of bargaining history over either MOU Article I, Section VII or CSRR Section 92
was introduced into evidence at the hearing. Thus, we cannot conclude that the contractual
language establishes a clear intent to incorporate the CSRRs into the MOU.9 Moreover, even
if we were to construe the MOU to incorporate the CSRRs, the provisions of Article I,
Section VII, on their face require the City to meet and confer prior to implementing any change
affecting wages, hours and terms and conditions of employment, and prohibit the City from
reducing wages without the agreement of IAM. ~herefore, we conclude that the MOU did not
authorize the unilateral implementation of furloughs.
2. 	Without Notice and an Opportunity to Bargain
The City argues that, even if it had an obligation under the MMBA to bargain over the
imposition of furloughs, it satisfied that obligation by meeting and conferring in good faith
with the Association on multiple occasions prior to imposing the furloughs. 	The City contends
that former MMBA section 3505.4 did not require it to make a formal declaration of impasse
or make a "last, best and final offer" prior to implementation.
We discuss at pages 17-20 below the City's argument that Section 92 gave it the
independent authority to unilaterally impose furloughs without first meeting and conferring
with IAM.
13
thereto, "shall be in full force and effect during the term of this MOU." That section further
provides that the City shall meet and confer prior to implementing any changes in these
"Personnel Policies and Procedures or Departmental Rules and Regulations" directly affecting
wages, hours and terms and conditions of employment. Finally, the MOU provides that
employee wages and fringe benefits will not be reduced unless agreed to by IAM.
No documents entitled "Personnel Policies and Procedures" or "Departmental Rules
and Regulations" were offered into evidence at the hearing before the ALJ. In addition, no
evidence of bargaining history over either MOU Article I, Section VII or CSRR Section 92
was introduced into evidence at the hearing. Thus, we cannot conclude that the contractual
language establishes a clear intent to incorporate the CSRRs into the MOU." Moreover, even
if we were to construe the MOU to incorporate the CSRRs, the provisions of Article I,
Section VII, on their face require the City to meet and confer prior to implementing any change
affecting wages, hours and terms and conditions of employment, and prohibit the City from
reducing wages without the agreement of IAM. Therefore, we conclude that the MOU did not
authorize the unilateral implementation of furloughs.
2. 	Without Notice and an Opportunity to Bargain
The City argues that, even if it had an obligation under the MMBA to bargain over the
imposition of furloughs, it satisfied that obligation by meeting and conferring in good faith
with the Association on multiple occasions prior to imposing the furloughs. The City contends
that former MMBA section 3505.4 did not require it to make a formal declaration of impasse
or make a "last, best and final offer" prior to implementation.
" We discuss at pages 17-20 below the City's argument that Section 92 gave it the
independent authority to unilaterally impose furloughs without first meeting and conferring
with IAM.
13

Former MMBA section 3505.4 provided:
If after meeting and conferring in good faith, an impasse has been
reached between the public agency and the recognized employee
organization, and impasse procedures, where applicable, have
been exhausted, a public agency that is not required to proceed to
interest arbitration may implement its last, best, and final offer,
but shall not implement a memorandum of understanding. The
unilateral implementation of a public agency's last, best, and final
offer shall not deprive a recognized employee organization of the
right each year to meet and confer on matters within the scope of
representation, whether or not those matters are included in the
unilateral implementation, prior to the adoption by the public
agency of its annual budget, or as otherwise required by law.
MMBA section 3505 defines the bargaining obligation as follows:
The governing body of a public agency, or such boards,
commissions, administrative officers or other representatives as
may be properly designated by law or by such governing body,
shall meet and confer in good faith regarding wages, hours, and
other terms and conditions of employment with representatives of
such recognized employee organizations, as defined in
subdivision (b) of Section 3501, and shall consider fully such
presentations as are made by the employee organization on behalf
of its members prior to arriving at a determination of policy or
course of action.
"Meet and confer in good faith" means that a public agency, or
such representatives as it may designate, and representatives of
recognized employee organizations, shall have the mutual
obligation personally to meet and confer promptly upon request
by either party and continue for a reasonable period of time in
order to exchange freely information, opinions, and proposals,
and to endeavor to reach agreement on matters within the scope
of representation prior to the adoption by the public agency of its
final budget for the ensuing year. 	process should
adequate time for the resolution of impasses where specific
procedures for such resolution are 	local rule,
regulation, or ordinance, or when such procedures are utilized by
mutual consent.
Although the term "impasse" appears several times in the MMBA, the MMBA itself,
unlike other statutes within PERB 's jurisdiction, does not contain a definition of impasse.
14
Former MMBA section 3505.4 provided:
If after meeting and conferring in good faith, an impasse has been
reached between the public agency and the recognized employee
organization, and impasse procedures, where applicable, have
been exhausted, a public agency that is not required to proceed to
interest arbitration may implement its last, best, and final offer,
but shall not implement a memorandum of understanding. The
unilateral implementation of a public agency's last, best, and final
offer shall not deprive a recognized employee organization of the
right each year to meet and confer on matters within the scope of
representation, whether or not those matters are included in the
unilateral implementation, prior to the adoption by the public
agency of its annual budget, or as otherwise required by law.
MMBA section 3505 defines the bargaining obligation as follows:
The governing body of a public agency, or such boards,
commissions, administrative officers or other representatives as
may be properly designated by law or by such governing body,
shall meet and confer in good faith regarding wages, hours, and
other terms and conditions of employment with representatives of
such recognized employee organizations, as defined in
subdivision (b) of Section 3501, and shall consider fully such
presentations as are made by the employee organization on behalf
of its members prior to arriving at a determination of policy or
course of action.
"Meet and confer in good faith" means that a public agency, or
such representatives as it may designate, and representatives of
recognized employee organizations, shall have the mutual
obligation personally to meet and confer promptly upon request
by either party and continue for a reasonable period of time in
order to exchange freely information, opinions, and proposals,
and to endeavor to reach agreement on matters within the scope
of representation prior to the adoption by the public agency of its
final	final budget for the ensuing year.	budget for the	final bu
adequate time for the resolution of impasses where specific
ocal rule,	procedures for such resolution are contained in l
regulation, or ordinance, or when such procedures are utilized by
mutual consent.
Although the term "impasse" appears several times in the MMBA, the MMBA itself,
unlike other statutes within PERB's jurisdiction, does not contain a definition of impasse.
14

Under the Educational Employment Relations Act (EERA), 10 impasse is defined to mean that
"the parties to a dispute over matters within the scope of representation have reached a point in
meeting and negotiating at which their differences in positions are so substantial or prolonged
that future meetings would be futile." (EERA, § 3 540 .1 ( f). )11 Thus, PERB has held that an
impasse in bargaining exists where the "parties have considered each other's proposals and
counterproposals, attempted to narrow the gap of disagreement and have, nonetheless, reached
a point in their negotiations where continued discussion would be futile." (Mt. San Antonio
Community College District (1981) PERB Order No. Ad-124.)
Despite the absence of a specific statutory definition under the MMBA, the concept of
impasse is well established as a term of art under the MMBA. MMBA section 3505 defines
the obligation to meet and confer in good faith as requiring the parties to meet and confer "for
a reasonable period of time in order to exchange freely information, opinions, and proposals,
and to endeavor to reach agreement.'.' Former section 3504.5 permitted the public agency, after
meeting and conferring in good faith, to implement its last, best and final offer after an impasse
has been reached and any applicable impasse resolution procedures exhausted. 12 Typically, an
employer seeking to unilaterally implement its proposal after reaching impasse will present a
last, best, and final offer and formally declare impasse. (See, e.g., City of Davis (2012) PERB
Decision No. 2271-M (City of Davis) [finding city unlawfully implemented last, best, and final
offer including furloughs prior to exhausting of impasse resolution procedures].) Given the
10 EERA is codified at section 3540 et seq.
11 Similarly, under the Higher Education Employer-Employees Relations Act (codified
at § 3560 et seq.), impasse is defined to mean that "the parties have reached a point in meeting
and conferring at which their differences in positions are such that further meetings would be
futile." (§ 3562G).)
12 In this case, there is no evidence of any applicable impasse resolution procedures.
15
Under the Educational Employment Relations Act (EERA), "impasse is defined to mean that
"the parties to a dispute over matters within the scope of representation have reached a point in
meeting and negotiating at which their differences in positions are so substantial or prolonged
that future meetings would be futile." (EERA, $ 3540.1(f).)" Thus, PERB has held that an
impasse in bargaining exists where the "parties have considered each other's proposals and
counterproposals, attempted to narrow the gap of disagreement and have, nonetheless, reached
a point in their negotiations where continued discussion would be futile." (Mt. San Antonio
Community College District (1981) PERB Order No. Ad-124.)
Despite the absence of a specific statutory definition under the MMBA, the concept of
impasse is well established as a term of art under the MMBA. MMBA section 3505 defines
the obligation to meet and confer in good faith as requiring the parties to meet and confer "for
a reasonable period of time in order to exchange freely information, opinions, and proposals,
and to endeavor to reach agreement." Former section 3504.5 permitted the public agency, after
meeting and conferring in good faith, to implement its last, best and final offer after an impasse
has been reached and any applicable impasse resolution procedures exhausted." Typically, an
employer seeking to unilaterally implement its proposal after reaching impasse will present a
last, best, and final offer and formally declare impasse. (See, e.g., City of Davis (2012) PERB
Decision No. 2271-M (City of Davis) [finding city unlawfully implemented last, best, and final
offer including furloughs prior to exhausting of impasse resolution procedures].) Given the
1EERA is codified at section 3540 et seq.
"Similarly, under the Higher Education Employer-Employees Relations Act (codified
at $ 3560 et seq.), impasse is defined to mean that "the parties have reached a point in meeting
and conferring at which their differences in positions are such that further meetings would be
futile." ($ 3562(j).)
12 In this case, there is no evidence of any applicable impasse resolution procedures.
15

overwhelming acceptance of the concept of impasse as a term of art central to labor relations,
we find the definition of impasse under EERA, as interpreted by PERB, to be appropriate
under the MMBA as well. (Fire Fighters Union v. City of Vallejo (1974) 12 Cal.3d 608
(Vallejo ). 13)
Based upon the record before us, it appears that the City had always intended to
implement a five-day furlough by May 2009. Nonetheless, the parties continued to actively
discuss furloughs and other alternative cost-saving measures through April 9, 2009, and had
scheduled another meeting for May 7. There is no evidence to support a conclusion that they
reached a point at which further negotiations would be futile. Thus, regardless of whether or
not the City formally declared impasse or presented a "last, best and final offer," we conclude
than an impasse did not exist as of May 5, 2009.
3. 	Change in Policy
There is no question that the implementation of furloughs had a generalized effect and
continuing impact on the terms and conditions of employment of bargaining unit employees,
thereby constituting a change in policy. (Grant, supra, PERB Decision No. 196.)
4. 	Within Scope of Representation
MMBA section 3504 provides:
The scope of representation shall include all matters relating to
employment conditions and employer-employee relations,
iincluding, but not limited to, wages, hours, and other terms
conditions of employment, except, however, that the scope of
representation shall not include consideration of the merits,
necessity, or organization of any service or activity provided by
or 	order.
1 When interpreting the MMBA, it is appropriate to take guidance from cases
interpreting the National Labor Relations Act and California labor relations statutes with
parallel provisions.
16
overwhelming acceptance of the concept of impasse as a term of art central to labor relations,
we find the definition of impasse under EERA, as interpreted by PERB, to be appropriate
under the MMBA as well. (Fire Fighters Union v. City of Vallejo (1974) 12 Cal.3d 608
(Vallejo).")
Based upon the record before us, it appears that the City had always intended to
implement a five-day furlough by May 2009. Nonetheless, the parties continued to actively
discuss furloughs and other alternative cost-saving measures through April 9, 2009, and had
scheduled another meeting for May 7. There is no evidence to support a conclusion that they
reached a point at which further negotiations would be futile. Thus, regardless of whether or
not the City formally declared impasse or presented a "last, best and final offer," we conclude
than an impasse did not exist as of May 5, 2009.
3. 	Change in Policy
There is no question that the implementation of furloughs had a generalized effect and
continuing impact on the terms and conditions of employment of bargaining unit employees,
thereby constituting a change in policy. (Grant, supra, PERB Decision No. 196.)
4. 	Within Scope of Representation
MMBA section 3504 provides:
The scope of representation shall include all matters relating to
employment conditions and employer-employee relations,
ncluding, but not limited to, wages, hours, and other terms	incl
conditions of employment, except, however, that the scope of
representation shall not include consideration of the merits,
necessity, or organization of any service or activity provided by
law or executive order.
When interpreting the MMBA, it is appropriate to take guidance from cases
interpreting the National Labor Relations Act and California labor relations statutes with
parallel provisions. 16

Both wages and hours are expressly included within the scope of representation under
the MMBA. Thus, because the imposition of furloughs clearly affects both wages and hours of
work, it is within the scope of representation, unless an exception or defense applies. (See also
San Ysidro School District (1997) PERB Decision No. 1198 [reduction in hours is within scope
of bargaining].) We address the City's asserted waiver defense below, along with its argument
that the contractual provisions are consistent with its right to unilaterally implement
fundamental management decisions.
The City's Defenses
The City asserts several arguments as defenses to the unilateral change complaint.
1. 	CSRR Section 92
The City argues that Section 92 of the CSRRs authorized it to reduce employee hours
by unilaterally implementing furloughs, without regard to the requirements of the MMBA.
Section 92 provides that, "for reasons of economy or due to a lack of work or funds, an
appointing authority may reorganize or eliminate any department, bureau, or division, or may
abolish any position under its direct jurisdiction, and/or reduce the number of, or the hours
worked by City employees." According to the City, this language permitted it to unilaterally
reduce employee hours in the form of furloughs.
Nothing in Section 92 expressly mentions furloughs, nor is there any evidence that the
parties bargained over this provision. In contrast, the Board has found no unilateral change
,vhere, after first bargaining to impasse prior to the adoption of a policy expressly granting the
employer the authority to furlough employees, the employer applied the policy to a group of
employees initially excluded but later covered by a subsequently negotiated amendment.
(County of Fresno (2010) PERB Decision No. 2125-M.) Here, there is no evidence that
Section 92 was intended to include furloughs, nor that the parties ever bargained over the
17
Both wages and hours are expressly included within the scope of representation under
the MMBA. Thus, because the imposition of furloughs clearly affects both wages and hours of
work, it is within the scope of representation, unless an exception or defense applies. (See also
San Ysidro School District (1997) PERB Decision No. 1198 [reduction in hours is within scope
of bargaining].) We address the City's asserted waiver defense below, along with its argument
that the contractual provisions are consistent with its right to unilaterally implement
fundamental management decisions.
The City's Defenses
The City asserts several arguments as defenses to the unilateral change complaint.
1. 	CSRR Section 92
The City argues that Section 92 of the CSRRs authorized it to reduce employee hours
by unilaterally implementing furloughs, without regard to the requirements of the MMBA.
Section 92 provides that, "for reasons of economy or due to a lack of work or funds, an
appointing authority may reorganize or eliminate any department, bureau, or division, or may
abolish any position under its direct jurisdiction, and/or reduce the number of, or the hours
worked by City employees." According to the City, this language permitted it to unilaterally
reduce employee hours in the form of furloughs.
Nothing in Section 92 expressly mentions furloughs, nor is there any evidence that the
parties bargained over this provision. In contrast, the Board has found no unilateral change
where, after first bargaining to impasse prior to the adoption of a policy expressly granting the
employer the authority to furlough employees, the employer applied the policy to a group of
employees initially excluded but later covered by a subsequently negotiated amendment.
(County of Fresno (2010) PERB Decision No. 2125-M.) Here, there is no evidence that
Section 92 was intended to include furloughs, nor that the parties ever bargained over the
17

prov1S1on. Accordingly, we decline to interpret it as authorizing the City to unilaterally
implement furloughs.
Even assuming, arguendo, that Section 92 could be read to authorize furloughs, it
would not necessarily eliminate the City's obligations to meet and confer under the MMBA.
(Building Material & Construction Teamsters' Union, Local 2 I 6 v. Farrell (1986)
41 Cal.3d 651 (Farrell).) 	In Farrell, the court considered whether provisions of the
San Francisco city charter giving the civil service commission the authority to reclassify or
reallocate positions authorized the city to unilaterally eliminate bargaining unit positions and
reassign their duties outside the unit, without complying with the meet and confer requirements
of the MMBA. The court held that the longstanding rule that "statutes should be construed in
harmony with other statutes on the same general subject" applied as well to potential conflicts
between a statute and a charter provision. (Id. at p. 665.) Applying this rule, the court found
that the power to reclassify employment positions was not necessarily inconsistent with the
meet and confer requirements of the MMBA, since "public agencies retain the ultimate power
to refuse to agree on any particular issue." (Ibid.) 	In addition, the court found that the charter
language at issue did not clearly vest exclusive authority with the commission or encompass
the power to divert duties from one classification to another. (Id. at p. 666.)
Furthermore, as noted by the court in Farrell, supra, 41 Cal.3d 651, the MMBA' s meet
and confer requirements have generally been found to be compatible with other legal and
contractual provisions. (See, e.g., People ex rel. Seal Beach Police Officers Assn. v. City of
Seal Beach (1984) 36 Cal.3d. 591 (Seal Beach) [city's constitutional right to propose charter
amendments is compatible with mandate to meet and confer before proposing amendments
concerning terms and conditions of public employment]; Los Angeles County Civil Service
Com. v. Superior Court (1978) 23 Cal.3d 55 [MMBA's meet and confer requirements not
18
provision. Accordingly, we decline to interpret it as authorizing the City to unilaterally
implement furloughs.
Even assuming, arguendo, that Section 92 could be read to authorize furloughs, it
would not necessarily eliminate the City's obligations to meet and confer under the MMBA.
(Building Material & Construction Teamsters' Union, Local 216 v. Farrell (1986)
41 Cal.3d 651 (Farrell).) In Farrell, the court considered whether provisions of the
San Francisco city charter giving the civil service commission the authority to reclassify or
reallocate positions authorized the city to unilaterally eliminate bargaining unit positions and
reassign their duties outside the unit, without complying with the meet and confer requirements
of the MMBA. The court held that the longstanding rule that "statutes should be construed in
harmony with other statutes on the same general subject" applied as well to potential conflicts
between a statute and a charter provision. (Id. at p. 665.) Applying this rule, the court found
that the power to reclassify employment positions was not necessarily inconsistent with the
meet and confer requirements of the MMBA, since "public agencies retain the ultimate power
to refuse to agree on any particular issue." (Ibid.) In addition, the court found that the charter
language at issue did not clearly vest exclusive authority with the commission or encompass
the power to divert duties from one classification to another. (Id. at p. 666.)
Furthermore, as noted by the court in Farrell, supra, 41 Cal.3d 651, the MMBA's meet
and confer requirements have generally been found to be compatible with other legal and
contractual provisions. (See, e.g., People ex rel. Seal Beach Police Officers Assn. v. City of
Seal Beach (1984) 36 Cal.3d. 591 (Seal Beach) [city's constitutional right to propose charter
amendments is compatible with mandate to meet and confer before proposing amendments
concerning terms and conditions of public employment]; Los Angeles County Civil Service
Com. v. Superior Court (1978) 23 Cal.3d 55 [MMBA's meet and confer requirements not
18

inconsistent with county charter provision requiring civil service commission to hold public
hearings before amending layoff rules]; Independent Union of Pub. Service Employees v.
County of Sacramento (1983) 147 Cal.App.3d 482 [agreement between county and union
giving county the exclusive right to assign employees held not inconsistent with duty to meet
and confer over shift changes].) Therefore, considering the general rules of statutory
construction, the specific wording of the charter provision in that case, and the weight of
authority, the court concluded that the requirements of the MMBA were not incompatible with
the city charter. (Farrell, supra, 41 Cal.3d at p. 667; see also South Placer Fire Protection
District (2008) PERB Decision No. 1960-M [public entity had no management right to
unilaterally reclassify employees to a position outside bargaining unit, notwithstanding
employer's claim that local employer-employee relations resolution gave it the exclusive right
to reclassify employees].)
As with the city charter in Farrell, supra, 41 Cal.3d 651, nothing in CSRR Section 92
purports to exempt the City from compliance with the meet and confer obligations under the
MMBA prior to implementing a reduction in employee work hours. It is also far from clear
that Section 92's language permitting the City to reduce employee hours also authorizes it to
impose employee furloughs. As discussed above, the MOU also contains language requiring
the parties to meet and confer before the City may amend its personnel policies or
departmental rules and regulations on matters directly affecting wages, hours and terms and
conditions of employment, and prohibits the City from reducing wages unless agreed to by
IAM. Furthermore, because not all IAM bargaining unit employees are within the civil
service, Section 92 would not apply to them. Given our obligation to attempt to harmonize
local rules with the requirements of the MMBA, we do not construe Section 92 to authorize the
19
inconsistent with county charter provision requiring civil service commission to hold public
hearings before amending layoff rules]; Independent Union of Pub. Service Employees v.
County of Sacramento (1983) 147 Cal.App.3d 482 [agreement between county and union
giving county the exclusive right to assign employees held not inconsistent with duty to meet
and confer over shift changes].) Therefore, considering the general rules of statutory
construction, the specific wording of the charter provision in that case, and the weight of
authority, the court concluded that the requirements of the MMBA were not incompatible with
the city charter. (Farrell, supra, 41 Cal.3d at p. 667; see also South Placer Fire Protection
District (2008) PERB Decision No. 1960-M [public entity had no management right to
unilaterally reclassify employees to a position outside bargaining unit, notwithstanding
employer's claim that local employer-employee relations resolution gave it the exclusive right
to reclassify employees].)
As with the city charter in Farrell, supra, 41 Cal.3d 651, nothing in CSRR Section 92
purports to exempt the City from compliance with the meet and confer obligations under the
MMBA prior to implementing a reduction in employee work hours. It is also far from clear
that Section 92's language permitting the City to reduce employee hours also authorizes it to
impose employee furloughs. As discussed above, the MOU also contains language requiring
the parties to meet and confer before the City may amend its personnel policies or
departmental rules and regulations on matters directly affecting wages, hours and terms and
conditions of employment, and prohibits the City from reducing wages unless agreed to by
IAM. Furthermore, because not all IAM bargaining unit employees are within the civil
service, Section 92 would not apply to them. Given our obligation to attempt to harmonize
local rules with the requirements of the MMBA, we do not construe Section 92 to authorize the
19

City to act unilaterally without compliance with the meet and confer obligations of the
MMBA.
We further find that City of Vista, supra, 54 Cal.4 th 547, submitted by the City in its
supplemental brief, has no bearing on the issues before us. In that case, the court held that
state prevailing wage law was inapplicable to charter cities, pursuant to article VI, section 5 of
the California Constitution. As recognized by the City in its supplemental brief, it is well
established that the meet and confer requirements of the MMBA are a matter of statewide
concern and enforceable against charter cities. (Id. at p. 564, citing Seal Beach, supra,
36 Cal.3d at p. 600, and Professional Fire Fighters, Inc. v. City of Los Angeles (1963)
60 Cal.2d 276, 294-295.) The City relies, however, on a footnote in Seal Beach in which the
court noted that while the substance of the salaries of local charter city employees is not
subject to general law, the process by which its salaries are fixed is obviously a matter of
statewide concern. (Id. at p. 600, fn. 11.) According to the City, Section 92 "constitutes a
substantive provision in the sense that it authorizes emergency reduction of employee hours in
the case of lack of work or funds" and is therefore not procedural and subject to bargaining
under the MMBA. We disagree. While the number of hours worked by City employees may
be a matter of local concern, the process by which a change in employee hours is determined is
a matter of statewide concern. We therefore reject the City's argument that CSRR Section 92 is
a "substantive" provision within the meaning of the Seal Beach footnote that renders the meet
and confer requirements of the MMBA inapplicable.
2. 	Waiver
The City argues that its decision to implement furloughs was authorized by waiver
pursuant to the management rights clause contained in the parties' MOU. Waiver is an
affirmative defense that must be proven by the party asserting it. (Regents of the University of
20
City to act unilaterally without compliance with the meet and confer obligations of the
MMBA.
We further find that City of Vista, supra, 54 Cal.4 547, submitted by the City in its
supplemental brief, has no bearing on the issues before us. In that case, the court held that
state prevailing wage law was inapplicable to charter cities, pursuant to article VI, section 5 of
the California Constitution. As recognized by the City in its supplemental brief, it is well
established that the meet and confer requirements of the MMBA are a matter of statewide
concern and enforceable against charter cities. (Id. at p. 564, citing Seal Beach, supra,
36 Cal.3d at p. 600, and Professional Fire Fighters, Inc. v. City of Los Angeles (1963)
60 Cal.2d 276, 294-295.) The City relies, however, on a footnote in Seal Beach in which the
court noted that while the substance of the salaries of local charter city employees is not
subject to general law, the process by which its salaries are fixed is obviously a matter of
statewide concern. (Id. at p. 600, fn. 11.) According to the City, Section 92 "constitutes a
substantive provision in the sense that it authorizes emergency reduction of employee hours in
the case of lack of work or funds" and is therefore not procedural and subject to bargaining
under the MMBA. We disagree. While the number of hours worked by City employees may
be a matter of local concern, the process by which a change in employee hours is determined is
a matter of statewide concern. We therefore reject the City's argument that CSRR Section 92 is
a "substantive" provision within the meaning of the Seal Beach footnote that renders the meet
and confer requirements of the MMBA inapplicable.
2. 	Waiver
The City argues that its decision to implement furloughs was authorized by waiver
pursuant to the management rights clause contained in the parties' MOU. Waiver is an
affirmative defense that must be proven by the party asserting it. (Regents of the University of
20

California (2004) PERB Decision No. 1689-H.) Waiver of the right to bargain must be "clear
and unmistakable." (Amador Valley Joint Union High School District (1978) PERB Decision
No. 74; Farrell, supra, 41 Cal.3d 651.) Waiver will not be lightly inferred and any doubts
must be resolved against the party asserting it. (Placentia Unified School District (1986)
PERB Decision No. 595.) A generally-worded management rights clause will not be construed
as a waiver of the right to bargain. (San Jacinto Unified School District (1994) PERB
Decision No. 1078 (San Jacinto) [language giving management right to determine times and
hours of operation and to assign employees does not give employer contractual right to
unilaterally change employee's assigned hours].)
The parties' MOU contains a management rights clause, Section VI(A), which states, in
relevant part:
The City reserves, retains, and is vested with all rights to manage
the City. The constitutional, statutory, charter, or inherent rights,
powers, authority, and functions shall remain exclusively vested
with the City pursuant to Government Code Section 3500 et seq.
These rights include but are not limited to the following:
1. 	To manage the City.
2. 	To determine the necessity, organization, and standards to
implement any service or activity conducted by the City.
5. 	To determine and/or change the size and composition of
the City work force and assign work to employees.
7. 	To maintain order and efficiency in City facilities and
operations.
10. 	All rights, powers, authority, and functions of
management, whether heretofore or hereinafter exercised, shall
remain vested exclusively with the City.
The City asserts that this language, giving the City the right to determine and/or change
the size and composition of the City work force and assign work to employees, permits it to
21
California (2004) PERB Decision No. 1689-H.) Waiver of the right to bargain must be "clear
and unmistakable." (Amador Valley Joint Union High School District (1978) PERB Decision
No. 74; Farrell, supra, 41 Cal.3d 651.) Waiver will not be lightly inferred and any doubts
must be resolved against the party asserting it. (Placentia Unified School District (1986)
PERB Decision No. 595.) A generally-worded management rights clause will not be construed
as a waiver of the right to bargain. (San Jacinto Unified School District (1994) PERB
Decision No. 1078 (San Jacinto) [language giving management right to determine times and
hours of operation and to assign employees does not give employer contractual right to
unilaterally change employee's assigned hours].)
The parties' MOU contains a management rights clause, Section VI(A), which states, in
relevant part:
The City reserves, retains, and is vested with all rights to manage
the City. The constitutional, statutory, charter, or inherent rights,
powers, authority, and functions shall remain exclusively vested
with the City pursuant to Government Code Section 3500 et seq.
These rights include but are not limited to the following:
1 . 	To manage the City.
2. 	To determine the necessity, organization, and standards to
implement any service or activity conducted by the City.
5. 	To determine and/or change the size and composition of
the City work force and assign work to employees.
7. 	To maintain order and efficiency in City facilities and
operations.
10. All rights, powers, authority, and functions of
management, whether heretofore or hereinafter exercised, shall
remain vested exclusively with the City.
The City asserts that this language, giving the City the right to determine and/or change
the size and composition of the City work force and assign work to employees, permits it to
21

unilaterally impose furloughs. 	We disagree. The general language authorizing the City to
determine the size and composition of its workforce and to assign work does not clearly and
unmistakably waive the Association's right to bargain over the reduction in wages and hours
imposed by the implementation of furloughs. 	(San Jacinto, supra, PERB Decision No. 1078.)
The City also argues that these contractual provisions are "consistent with those
fundamental management decisions that have been deemed to be outside the scope of
representation that requires bargaining." Pursuant to the final clause of MMBA section 3504,
an employer may be excused from the obligation to bargain under the MMBA when the
employer's action is a "fundamental managerial or policy decision" that falls outside the
scope of representation. (Farrell, supra, 41 Cal.3d 651; Claremont Police Officers Assn. v.
City of Claremont (2006) 39 Cal.4th 623.) A "fundamental management decision" is one
that directly affects the quality and nature of public services. (Farrell, supra, 41 Cal.3d at
pp. 662-664; Sutter County In-Home Supportive Services Public Authority (2007) PERR
Decision No. 1900-M (Sutter County).) For example, the decision to lay off employees has
been found to be a fundamental management decision outside the scope of bargaining. (City of
Richmond (2004) PERB Decision No. 1720-M; Newman-Crows Landing Unified School
District (1982) PERB Decision No. 223; Vallejo, supra, 12 Cal.3d 608; see also San Jose
Peace Officers Assn. v. City of San Jose (1978) 78 Cal.App.3d 935 [matters relating to public
safety are within the managerial prerogative; regulation governing circumstances under which
a police officer may discharge a firearm fell within managerial prerogative because of its
fundamental public safety purpose]; Berkeley Police Assn. v. City of Berkeley (1977)
76 Cal.App.3d 931 [police review procedure was a matter of police-community relations, and
thus a managerial policy decision outside scope of representation].) On the other hand,
22
unilaterally impose furloughs. We disagree. The general language authorizing the City to
determine the size and composition of its workforce and to assign work does not clearly and
unmistakable waive the Association's right to bargain over the reduction in wages and hours
imposed by the implementation of furloughs. (San Jacinto, supra, PERB Decision No. 1078.)
The City also argues that these contractual provisions are "consistent with those
fundamental management decisions that have been deemed to be outside the scope of
representation that requires bargaining." Pursuant to the final clause of MMBA section 3504,
an employer may be excused from the obligation to bargain under the MMBA when the
employer's action is a "fundamental managerial or policy decision" that falls outside the
scope of representation. (Farrell, supra, 41 Cal.3d 651; Claremont Police Officers Assn. v.
City of Claremont (2006) 39 Cal.4th 623.) A "fundamental management decision" is one
that directly affects the quality and nature of public services. (Farrell, supra, 41 Cal.3d at
pp. 662-664; Sutter County In-Home Supportive Services Public Authority (2007) PERB
Decision No. 1900-M (Sutter County).) For example, the decision to lay off employees has
been found to be a fundamental management decision outside the scope of bargaining. (City of
Richmond (2004) PERB Decision No. 1720-M; Newman-Crows Landing Unified School
District (1982) PERB Decision No. 223; Vallejo, supra, 12 Cal.3d 608; see also San Jose
Peace Officers Assn. v. City of San Jose (1978) 78 Cal.App.3d 935 [matters relating to public
safety are within the managerial prerogative; regulation governing circumstances under which
a police officer may discharge a firearm fell within managerial prerogative because of its
fundamental public safety purpose]; Berkeley Police Assn. v. City of Berkeley (1977)
76 Cal.App.3d 931 [police review procedure was a matter of police-community relations, and
thus a managerial policy decision outside scope of representation].) On the other hand,
22

decisions that primarily affect wages, hours and other terms and conditions of employment are
within the scope of representation and thus subject to bargaining. (Sutter County.)
We disagree that the City's decision to furlough employees was a fundamental
management decision over which it did not have to bargain. It is clear that the City viewed the
matter to be within the scope of representation, as it repeatedly asserted to the City Council
that the furloughs would be subject to the meet and confer process. It is equally clear that the
decision was not aimed at affecting the quality, nature or level of service to the public, but
rather to save money by reducing employee wages. Accordingly, we find the management
rights exception inapplicable. 14
3. 	City Council Ratification of City's Implementation of Furloughs
The City asserts that, by adopting the May 5, 2009 resolution approving the furlough
plan, the City Council "ratified" the City's unilateral implementation of temporary furloughs,
citing Professional Engineers in California Government v. Schwarzenegger (2010)
50 Cal.4 th 989 (Professional Engineers). In Professional Engineers, the California Supreme
Court held that neither the California Constitution nor existing state statutes or MOU
provisions authorized the Governor or the Department of Personnel Administration to
unilaterally impose a mandatory furlough of state employees by way of an executive order.
(Id. at p. 1041.) The Court further held, however, that the subsequent enactment by the
Legislature of the Budget Act had the effect of "validating the plan that the Governor lacked
authority to impose unilaterally." (Id. at p. 1044.)
In reaching this decision, we make no determination as to whether or not the
imposition of furloughs may fall within the scope of the management rights in another case. In
this case, there is simply no evidence that the City's decision was aimed at affecting the
quality, nature or level of service to the public, as opposed to employee wages.
23
decisions that primarily affect wages, hours and other terms and conditions of employment are
within the scope of representation and thus subject to bargaining. (Sutter County.)
We disagree that the City's decision to furlough employees was a fundamental
management decision over which it did not have to bargain. It is clear that the City viewed the
matter to be within the scope of representation, as it repeatedly asserted to the City Council
that the furloughs would be subject to the meet and confer process. It is equally clear that the
decision was not aimed at affecting the quality, nature or level of service to the public, but
rather to save money by reducing employee wages. Accordingly, we find the management
rights exception inapplicable."4
3. 	City Council Ratification of City's Implementation of Furloughs
The City asserts that, by adopting the May 5, 2009 resolution approving the furlough
plan, the City Council "ratified" the City's unilateral implementation of temporary furloughs,
citing Professional Engineers in California Government v. Schwarzenegger (2010)
50 Cal.4 989 (Professional Engineers). In Professional Engineers, the California Supreme
Court held that neither the California Constitution nor existing state statutes or MOU
provisions authorized the Governor or the Department of Personnel Administration to
unilaterally impose a mandatory furlough of state employees by way of an executive order.
(Id. at p. 1041.) The Court further held, however, that the subsequent enactment by the
Legislature of the Budget Act had the effect of "validating the plan that the Governor lacked
authority to impose unilaterally." (Id. at p. 1044.)
In reaching this decision, we make no determination as to whether or not the
imposition of furloughs may fall within the scope of the management rights in another case. In
this case, there is simply no evidence that the City's decision was aimed at affecting the
quality, nature or level of service to the public, as opposed to employee wages.
23

The Court in Professional Engineers, supra, 50 Cal.4
th
989, based its decision
on
two
unique provisions
of
the Ralph C. Dills Act (Dills Act)
15
giving the Legislature "ultimate
control (through the budget process) over expenditures
of
state funds required by the
provisions
of
an MOU." (Id. at p. 1043.) First, Dills Act section 3517.6(b) provides, in
relevant part:	
"If
any provision
of
the memorandum
of
understanding requires the expenditure
of
funds, those provisions
of
the memorandum
of
understanding may not become effective
unless approved by the Legislature in the annual Budget Act." Second, Dills Act
section 3517.7 provides:
If
the Legislature does not approve or fully fund any provision
of
the memorandum
of
understanding which requires the
expenditure
of
funds, either party may reopen negotiations on all
or part
of
the memorandum
of
understanding.
Nothing herein shall prevent the parties from agreeing and
effecting those provisions
of
the memorandum
of
understanding
which have received legislative approval or those provisions
which do not require legislative action.
Thus, the Court concluded, "[b ]y virtue
of
these provisions in the Dills Act, the Legislature
retained its ultimate control (through the budget process) over expenditures
of
state funds
required by the provisions
of
an MOU.;' (Professional Engineers, supra, 50 Cal.4th at p. 1043,
citing Pacific Legal Foundation
v.
Brown (1981) 29 Cal.3d 168, 178 ["under [section 3517.6],
virtually all salary agreements are subject to prior legislative approval"].) In exercising that
authority, the Court concluded, the Legislature effectively relieved the state from its duty to
bargain by providing that the reduction in employee compensation shall be '"achieved through
the collective bargaining process for represented employees or through existing administration
authority."' (Professional Engineers, at pp. 1044-1046.) Accordingly, when the Legislature
passed the Budget Act, it acted within its own legislative prerogative in authorizing the
15
The Dills Act is codified at section 3512 et seq.
24
The Court in Professional Engineers, supra, 50 Cal.4" 989, based its decision on two
unique provisions of the Ralph C. Dills Act (Dills Act)" giving the Legislature "ultimate
control (through the budget process) over expenditures of state funds required by the
provisions of an MOU." (Id. at p. 1043.) First, Dills Act section 3517.6(b) provides, in
relevant part: "If any provision of the memorandum of understanding requires the expenditure
of funds, those provisions of the memorandum of understanding may not become effective
unless approved by the Legislature in the annual Budget Act." Second, Dills Act
section 3517.7 provides:
If the Legislature does not approve or fully fund any provision of
the memorandum of understanding which requires the
expenditure of funds, either party may reopen negotiations on all
or part of the memorandum of understanding.
Nothing herein shall prevent the parties from agreeing and
effecting those provisions of the memorandum of understanding
which have received legislative approval or those provisions
which do not require legislative action.
Thus, the Court concluded, "[bly virtue of these provisions in the Dills Act, the Legislature
retained its ultimate control (through the budget process) over expenditures of state funds
required by the provisions of an MOU." (Professional Engineers, supra, 50 Cal.4th at p. 1043,
citing Pacific Legal Foundation v. Brown (1981) 29 Cal.3d 168, 178 ["under [section 3517.6],
virtually all salary agreements are subject to prior legislative approval"].) In exercising that
authority, the Court concluded, the Legislature effectively relieved the state from its duty to
bargain by providing that the reduction in employee compensation shall be "achieved through
the collective bargaining process for represented employees or through existing administration
authority." (Professional Engineers, at pp. 1044-1046.) Accordingly, when the Legislature
passed the Budget Act, it acted within its own legislative prerogative in authorizing the
15 The Dills Act is codified at section 3512 et seq.
24

reduction in appropriations for employees to be achieved through the two-day-a-month
furlough plan. (Id. at pp. 1047-1048.)
The City argues that provisions of the MOU, City Charter, and City Municipal Code are
analogous to the Legislature's authority recognized by the Court in Professional Engineers,
supra, 50 Cal.4th 989, and authorized the City Council to authorize the unilateral
implementation of furloughs. 	Specifically, the City relies on the following provisions:
The City reserves, retains, and is vested with all rights to manage
the City. The constitutional, statutory, charter, or inherent rights,
powers, authority, and functions shall remain exclusively vested
with the City pursuant to Government Code section 3500 et seq.
(MOU, Article I, Section VI.)
Upon the commencement of the fiscal year, the budget and
appropriations ordinance as returned by the Mayor, and to the
extent modified thereafter by the City Council, shall become the
budget and appropriations ordinance for the ensuing fiscal year.
(City Charter, Section 1704.)
The Appropriation Ordinance shall govern and control the
expenditure and commitment amounts stated therein relating to
the several departments, offices and agencies during each fiscal
year.
(City Charter, Section 1705.)
Prior to the beginning of each fiscal year, the Council shall, by
resolution, establish the appropriations limit for the forthcoming
fiscal year pursuant to Article XIII B of the California
Constitution. Such appropriations limit may thereafter be revised
from time to time as provided by law.
(City Municipal Code, Section 3.04.090.)
While these provisions appear to define the City Council's authority over the budget
process, they cannot exempt the City from its bargaining obligations under the MMBA.
Unlike the Dills Act, nothing in the MMBA vests ultimate authority with local governing
25
reduction in appropriations for employees to be achieved through the two-day-a-month
furlough plan. (Id. at pp. 1047-1048.)
The City argues that provisions of the MOU, City Charter, and City Municipal Code are
analogous to the Legislature's authority recognized by the Court in Professional Engineers,
supra, 50 Cal.4th 989, and authorized the City Council to authorize the unilateral
implementation of furloughs. Specifically, the City relies on the following provisions:
The City reserves, retains, and is vested with all rights to manage
the City. The constitutional, statutory, charter, or inherent rights,
powers, authority, and functions shall remain exclusively vested
with the City pursuant to Government Code section 3500 et seq.
(MOU, Article I, Section VI.)
Upon the commencement of the fiscal year, the budget and
appropriations ordinance as returned by the Mayor, and to the
extent modified thereafter by the City Council, shall become the
budget and appropriations ordinance for the ensuing fiscal year.
(City Charter, Section 1704.)
The Appropriation Ordinance shall govern and control the
expenditure and commitment amounts stated therein relating to
the several departments, offices and agencies during each fiscal
year.
(City Charter, Section 1705.)
Prior to the beginning of each fiscal year, the Council shall, by
resolution, establish the appropriations limit for the forthcoming
fiscal year pursuant to Article XIII B of the California
Constitution. Such appropriations limit may thereafter be revised
from time to time as provided by law.
(City Municipal Code, Section 3.04.090.)
While these provisions appear to define the City Council's authority over the budget
process, they cannot exempt the City from its bargaining obligations under the MMBA.
Unlike the Dills Act, nothing in the MMBA vests ultimate authority with local governing
25

bodies to use their legislative authority, through the budget approval process, to relieve
covered employers from their bargaining obligations. Moreover, unlike the Legislature, which
enacted both the Dills Act and the MMBA, a local entity such as the City does not have the
authority to modify existing state law. Accordingly, we conclude that Professional Engineers
supra, 50 Cal.4th 989, does not support the City's position.
4. 	Fiscal Emergency
The City argues that MMBA section 3504.5 authorized it to impose furloughs
unilaterally due to the existence of an emergency. 	Section 3504.5 provides, in relevant part:
3504.5. Notice of proposed act relating to matters within scope
of representation; meeting; emergencies
(a) Except in cases of emergency as provided in this section, the
governing body of a public agency, and boards and commissions
designated by law or by the governing body of a public agency,
shall give reasonable written notice to each recognized employee
organization affected of any ordinance, rule, resolution, or
regulation directly relating to matters within the scope of
representation proposed to be adopted by the governing body or
the designated boards and commissions and shall give the
recognized employee organization the opportunity to meet with
the governing body or the boards and commissions.
(b) In cases of emergency when the governing body or the
designated boards and commissions determine that an ordinance,
rule, resolution, or regulation must be adopted immediately
without prior notice or meeting with a recognized employee
organization, the governing body or the boards and commissions
shall provide notice and opportunity to meet at the earliest
practicable time following the adoption of the ordinance, rule,
resolution, or regulation.
(Emphasis added.)
The Board has held that an employer's generalized concerns about its future financial
condition does not relieve it of the obligation to bargain. (San Francisco Community College
District (1979) PERB Decision No. 105 [employer's legitimate economic concerns over
26
bodies to use their legislative authority, through the budget approval process, to relieve
covered employers from their bargaining obligations. Moreover, unlike the Legislature, which
enacted both the Dills Act and the MMBA, a local entity such as the City does not have the
authority to modify existing state law. Accordingly, we conclude that Professional Engineers
supra, 50 Cal.4th 989, does not support the City's position.
44 	Fiscal Emergency
The City argues that MMBA section 3504.5 authorized it to impose furloughs
unilaterally due to the existence of an emergency. Section 3504.5 provides, in relevant part:
3504.5. Notice of proposed act relating to matters within scope
of representation; meeting; emergencies
(a) Except in cases of emergency as provided in this section, the
governing body of a public agency, and boards and commissions
designated by law or by the governing body of a public agency,
shall give reasonable written notice to each recognized employee
organization affected of any ordinance, rule, resolution, or
regulation directly relating to matters within the scope of
representation proposed to be adopted by the governing body or
the designated boards and commissions and shall give the
recognized employee organization the opportunity to meet with
the governing body or the boards and commissions.
(b) In cases of emergency when the governing body or the
designated boards and commissions determine that an ordinance,
rule, resolution, or regulation must be adopted immediately
without prior notice or meeting with a recognized employee
organization, the governing body or the boards and commissions
shall provide notice and opportunity to meet at the earliest
practicable time following the adoption of the ordinance, rule,
resolution, or regulation.
(Emphasis added.)
The Board has held that an employer's generalized concerns about its future financial
condition does not relieve it of the obligation to bargain. (San Francisco Community College
District (1979) PERB Decision No. 105 [employer's legitimate economic concerns over
26

reduction in local property tax revenues following passage of Proposition 13 did not authorize
it to act unilaterally or relieve it of the obligation to meet and negotiate]; San Francisco
Community College District (1980) PERB Decision No. 146 [economic concerns did not
relieve employer of obligation to bargain over reduction in salaries and benefits]; San Mateo
County Community College District (1979) PERB Decision No. 94 [same].) In Calexico
Unified School District (1983) PERB Decision No. 357 (Calexico), PERB held that, to
establish a defense to bargaining based upon business necessity, the employer must establish
"an actual financial emergency which leaves no real alternative to the action taken and allows
no time for meaningful negotiations before taking action." (Id. at p. 20, citing San Francisco
Community College District, supra, PERB Decision No. 105.) Applying this standard, the
Board has found no fiscal emergency where a city did not declare financial emergency, had
sufficient reserves to address its projected shortfall, and had readily available alternatives to
unilateral action. (City of Davis, supra, PERB Decision No. 2271-M, adopting ALJ's proposed
decision.)
The City appears to argue that the "actual financial emergency" that existed was that, as
of March 2009, the City was experiencing a nearly $20 million budget shortfall, and that, by
May 5, 2009 "there was simply no more time available to delay the implementation of the
furlough plan." This argument is based on the City's prior determination that a five-day
employee furlough was necessary to address the City's budget situation. Given that the City
did not formally declare a fiscal emergency until July 2009, two months after it unilaterally
implemented its furlough plan, the City's claim of financial emergency as of May 5, 2009 is
questionable. (City of Davis, supra, PERB Decision No. 2271-M.) Even assuming the
27
reduction in local property tax revenues following passage of Proposition 13 did not authorize
it to act unilaterally or relieve it of the obligation to meet and negotiate]; San Francisco
Community College District (1980) PERB Decision No. 146 [economic concerns did not
relieve employer of obligation to bargain over reduction in salaries and benefits]; San Mateo
County Community College District (1979) PERB Decision No. 94 [same].) In Calexico
Unified School District (1983) PERB Decision No. 357 (Calexico), PERB held that, to
establish a defense to bargaining based upon business necessity, the employer must establish
"an actual financial emergency which leaves no real alternative to the action taken and allows
no time for meaningful negotiations before taking action." (Id. at p. 20, citing San Francisco
Community College District, supra, PERB Decision No. 105.) Applying this standard, the
Board has found no fiscal emergency where a city did not declare financial emergency, had
sufficient reserves to address its projected shortfall, and had readily available alternatives to
unilateral action. (City of Davis, supra, PERB Decision No. 2271-M, adopting ALJ's proposed
decision.)
The City appears to argue that the "actual financial emergency" that existed was that, as
of March 2009, the City was experiencing a nearly $20 million budget shortfall, and that, by
May 5, 2009 "there was simply no more time available to delay the implementation of the
furlough plan." This argument is based on the City's prior determination that a five-day
employee furlough was necessary to address the City's budget situation. Given that the City
did not formally declare a fiscal emergency until July 2009, two months after it unilaterally
implemented its furlough plan, the City's claim of financial emergency as of May 5, 2009 is
questionable. (City of Davis, supra, PERB Decision No. 2271-M.) Even assuming the
27

existence
of
a financial emergency, a fact disputed by the Association,
16
the City failed to
establish that it had no alternative to unilaterally imposing furloughs on May
5,
2009, rather
than complete the meet and confer process. Instead, it appears that the City unilaterally
determined as far back as October 2008 that a five-day employee furlough consisting
of
one
day per month through the end
of
the fiscal year was the only means
of
achieving its desired
budget savings. The City's desire to implement its predetermined furlough plan does
not
establish an emergency justification under the Calexico, supra, PERB Decision No. 357,
standard for dispensing with its bargaining obligations.
The City also argues that its conduct was justified by decisions addressing the
impairment
of
contracts clauses under the United States and California Constitutions.
17
In
Sonoma County Organization
of
Public Employees
v.
County
of
Sonoma (1979)
23
Cal.3d 296,
the court held that a statute that invalidated local employee cost-of-living wage increases
agreed to during collective bargaining was not justified by any financial emergency and
therefore violated the federal and state constitutional prohibitfons against impairment
of
contracts.
18
The case before us does not involve the issue
of
whether an existing contractual
obligation has been impaired, but whether the City satisfied its meet and confer obligations
under the MMBA. Thus, Sonoma County and the federal cases relied upon by the City have no
bearing on the issues in this case.
1 The Association contends 	only approximately $4 million 	budget
was to be addressed by furloughs,
of
which only $1.2 million would be generated by the
furlough
of
Association employees. The Association further contends that the City had
earmarked up to $9 million in a Budget Stabilization Fund to be used to address financial
emergencies.
10 The
17
U.S. Constitution, article I, section 1
O;
California Constitution, article I, section 9.
18
The City also relies on federal decisions involving the federal contracts clause (see,
e.g., Buffalo Teachers Federation
v.
Tobe (2d Cir. 2006) 464 F.3d 362, and cases cited
therein).
28
existence of a financial emergency, a fact disputed by the Association, " the City failed to
establish that it had no alternative to unilaterally imposing furloughs on May 5, 2009, rather
than complete the meet and confer process. Instead, it appears that the City unilaterally
determined as far back as October 2008 that a five-day employee furlough consisting of one
day per month through the end of the fiscal year was the only means of achieving its desired
budget savings. The City's desire to implement its predetermined furlough plan does not
establish an emergency justification under the Calexico, supra, PERB Decision No. 357,
standard for dispensing with its bargaining obligations.
The City also argues that its conduct was justified by decisions addressing the
impairment of contracts clauses under the United States and California Constitutions. In
Sonoma County Organization of Public Employees v. County of Sonoma (1979) 23 Cal.3d 296,
the court held that a statute that invalidated local employee cost-of-living wage increases
agreed to during collective bargaining was not justified by any financial emergency and
therefore violated the federal and state constitutional prohibitions against impairment of
contracts." The case before us does not involve the issue of whether an existing contractual
obligation has been impaired, but whether the City satisfied its meet and confer obligations
under the MMBA. Thus, Sonoma County and the federal cases relied upon by the City have no
bearing on the issues in this case.
10 The Association contends that	10 The As 	only approximately $4 million	Associ
was to be addressed by furloughs, of which only $1.2 million would be generated by the
furlough of Association employees. The Association further contends that the City had
earmarked up to $9 million in a Budget Stabilization Fund to be used to address financial
emergencies.
17 U.S. Constitution, article I, section 10; California Constitution, article I, section 9.
The City also relies on federal decisions involving the federal contracts clause (see,
e.	e.g., Buffalo Teachers Federation v. Tobe (2d Cir. 2006) 464 F.3d 362, and cases cite
therein).
28

Harbor Department Employees
Although the City excepted to the ALJ's determination that it required Harbor
Departments to use accrued leave to make up the extra hour of work when furloughing
employees who normally worked nine-hour days, it offered no argument in support of its
position that the parties bargained to impasse on this issue. 	We find that the ALJ correctly
determined that the City unilaterally implemented this change in violationof the MMBA.
ORDER
Based on the foregoing and the entire record in the case, it is found that the
City of Long Beach (City) violated the Meyers-Milias-Brown Act (MMBA), Government
Code sections 3503, 3505 and 3506 and committed an unfair practice under Government
Code section 3509(b) and Public Employment Relations Board (PERB) Regulation 32603(a),
(b) and (c) (Cal. Code Regs., tit. 8, § 31001 et seq.), by unilaterally implementing furlough
policies without meeting and conferring in good faith with the International Association of
Machinists & Aerospace Workers, Local Lodge 1930, District 947 (1AM).
Pursuant to section 3509, subdivision (b) of the Government Code, it is hereby
ORDERED that the City, its governing board and its representatives shail:
A. 	CEASE AND DESIST FROM:
1. 	Unilaterally implementing furlough policies without meeting and
conferring in good faith with IAM.
2. 	Denying IAM its right to represent bargaining unit members in their
employment relations with the City.
3. 	Interfering with the right of bargaining unit members to be represented
by their chosen representative.
29
Harbor Department Employees
Although the City excepted to the ALJ's determination that it required Harbor
Departments to use accrued leave to make up the extra hour of work when furloughing
employees who normally worked nine-hour days, it offered no argument in support of its
position that the parties bargained to impasse on this issue. We find that the ALI correctly
determined that the City unilaterally implemented this change in violation of the MMBA.
ORDER
Based on the foregoing and the entire record in the case, it is found that the
City of Long Beach (City) violated the Meyers-Milias-Brown Act (MMBA), Government
Code sections 3503, 3505 and 3506 and committed an unfair practice under Government
Code section 3509(b) and Public Employment Relations Board (PERB) Regulation 32603(a),
(b) and (c) (Cal. Code Regs., tit. 8, $ 31001 et seq.), by unilaterally implementing furlough
policies without meeting and conferring in good faith with the International Association of
Machinists & Aerospace Workers, Local Lodge 1930, District 947 (IAM).
Pursuant to section 3509, subdivision (b) of the Government Code, it is hereby
ORDERED that the City, its governing board and its representatives shall:
A. 	CEASE AND DESIST FROM:
1 . 	Unilaterally implementing furlough policies without meeting and
conferring in good faith with IAM.
2 . 	Denying IAM its right to represent bargaining unit members in their
employment relations with the City.
3. 	Interfering with the right of bargaining unit members to be represented
by their chosen representative.
29

B. 	TAKE THE FOLLOWING AFFIRMATIVE ACTIONS DESIGNED TO
EFFECTUATE THE POLICIES OF THE MMBA:
1. 	Rescind the City Council's resolution dated May 5, 2009 and restore the
terms and conditions of employment prior to the passing of the May 5, 2009 resolution.
2. 	Make all affected employees whole for any loss of wages or benefits due
to the City's violation of the MMBA, including interest at 7 percent per annum.
3. 	Within ten (10) workdays of the service of a final decision in this matter,
post at all work locations where notices to employees in the City are customarily posted,
copies of the Notice attached hereto as an Appendix. The Notice must be signed by an
authorized agent of the City, indicating that it will comply with the terms of this Order. 	Such
posting shall be maintained for a period of thirty (30) consecutive workdays. Reasonable steps
shall be taken to ensure that the Notice is not reduced in size, altered, defaced or covered with
any other material.
4. 	Written notification of the actions taken to comply with this Order shall
be made to the General Counsel of PERB, or the General Counsel's designee. The City shall
provide reports, in writing, as directed by the General Counsel or his/her designee. All reports
regarding compliance with this Order shall be concurrently served on 1AM.
Chair Martinez and Member Huguenin joined 	this Decision.
30
B. 	TAKE THE FOLLOWING AFFIRMATIVE ACTIONS DESIGNED TO
EFFECTUATE THE POLICIES OF THE MMBA:
1. 	Rescind the City Council's resolution dated May 5, 2009 and restore the
terms and conditions of employment prior to the passing of the May 5, 2009 resolution.
2. 	Make all affected employees whole for any loss of wages or benefits due
to the City's violation of the MMBA, including interest at 7 percent per annum.
3 . 	Within ten (10) workdays of the service of a final decision in this matter,
post at all work locations where notices to employees in the City are customarily posted,
copies of the Notice attached hereto as an Appendix. The Notice must be signed by an
authorized agent of the City, indicating that it will comply with the terms of this Order. Such
posting shall be maintained for a period of thirty (30) consecutive workdays. Reasonable steps
shall be taken to ensure that the Notice is not reduced in size, altered, defaced or covered with
any other material.
4. 	Written notification of the actions taken to comply with this Order shall
be made to the General Counsel of PERB, or the General Counsel's designee. The City shall
provide reports, in writing, as directed by the General Counsel or his/her designee. All reports
regarding compliance with this Order shall be concurrently served on IAM.
Chair Martinez and Member Huguenin joined in this Decision.
30

APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
PUBLIC EMPLOYMENT RELATIONS BOARD
An Agency of the State of California
After a hearing in Unfair Practice Case No. LA-CE-537-M, International Association
of Machinists & Aerospace Workers, Local Lodge 1930, District 947 v. City of Long Beach, in
which all parties had the right to participate, it has been found that the City of Long Beach
(City) violated the Meyers-Milias-Brown Act (MMBA), Government Code sections 3503,
3505 and 3506, and Public Employment Relations Board Regulation 32603(a), (b) and (c)
(Cal. Code Regs., tit. 8, § 31001 et seq.), by unilaterally implementing furlough policies
without meeting and conferring in good faith with IAM.
As a result of this conduct, we have been ordered to post this Notice and we will:
A. 	CEASE AND DESIST FROM:
1. 	Unilaterally implementing furlough policies without meeting and
conferring in good faith with IAM.
2. 	Denying IAM its right to represent bargaining unit members in their
employment relations with the City.
3. 	Interfering with the right of bargaining unit members to be represented
by their chosen representative.
B. 	TAKE THE FOLLOWING AFFIRMATIVE ACTIONS DESIGNED TO
EFFECTUATE THE POLICIES OF THE MMBA:
1. 	Rescind the City Council's resolution dated May 5, 2009 and restore the
terms and conditions of employment prior to the passing of the May 5, 2009 resolution.
2. 	Make all affected employees whole for any loss of wages or benefits due
to the City's violation of the MMBA, including interest at 7 percent per annum.
APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
PUBLIC EMPLOYMENT RELATIONS BOARD
An Agency of the State of California
After a hearing in Unfair Practice Case No. LA-CE-537-M, International Association
of Machinists & Aerospace Workers, Local Lodge 1930, District 947 v. City of Long Beach, in
which all parties had the right to participate, it has been found that the City of Long Beach
(City) violated the Meyers-Milias-Brown Act (MMBA), Government Code sections 3503,
3505 and 3506, and Public Employment Relations Board Regulation 32603(a), (b) and (c)
(Cal. Code Regs., tit. 8, $ 31001 et seq.), by unilaterally implementing furlough policies
without meeting and conferring in good faith with IAM.
As a result of this conduct, we have been ordered to post this Notice and we will:
A. 	CEASE AND DESIST FROM:
1. 	Unilaterally implementing furlough policies without meeting and
conferring in good faith with IAM.
2. 	Denying IAM its right to represent bargaining unit members in their
employment relations with the City.
3. 	Interfering with the right of bargaining unit members to be represented
by their chosen representative.
B. 	TAKE THE FOLLOWING AFFIRMATIVE ACTIONS DESIGNED TO
EFFECTUATE THE POLICIES OF THE MMBA:
1 . 	Rescind the City Council's resolution dated May 5, 2009 and restore the
terms and conditions of employment prior to the passing of the May 5, 2009 resolution.
2. 	Make all affected employees whole for any loss of wages or benefits due
to the City's violation of the MMBA, including interest at 7 percent per annum.
Dated: 	CITY OF LONG BEACH	LONG
By:
Agent
THIS IS AN OFFICIAL NOTICE. IT MUST REMAIN POSTED FOR AT LEAST THIRTY (30)
CONSECUTIVE WORKDAYS FROM THE DATE OF POSTING AND MUST NOTBE
REDUCED IN SIZE, DEF ACED, ALTERED OR COVERED WITH ANY OTHER MATERIAL.
Authorized Agent
THIS IS AN OFFICIAL NOTICE. IT MUST REMAIN POSTED FOR AT LEAST THIRTY (30)
CONSECUTIVE WORKDAYS FROM THE DATE OF POSTING AND MUST NOT BE
REDUCED IN SIZE, DEFACED, ALTERED OR COVERED WITH ANY OTHER MATERIAL.