City and County of San Francisco (PERB 2041M)

STATE OF CALIFORNIA
DECISION OF THE
PUBLIC EMPLOYMENT RELATIONS BOARD
CITY & COUNTY OF SAN FRANCISCO,
Charging Party,
V.
STATIONARY ENGINEERS LOCAL 39,
Respondent.
Case No. SF-CO-129-M
PERB Decision No. 2041-M
June 29, 2009
Appearances: Office of the City Attorney by Gina Roccanova, Deputy City Attorney, for City
& County of San Francisco; Weinberg, Roger & Rosenfeld by Stewart Weinberg, Attorney, for
Stationary Engineers Local 39.
Before Dowdin Calvillo, Acting Chair; McKeag and Neuwald, Members.
DECISION
McKEAG, Member: This case comes before the Public Employment Relations Board
(PERB or Board) on appeal by Stationary Engineers Local 39 (Local 39) of a proposed
decision (attached) of an administrative law judge (ALJ). The charge alleged that Local 39
violated the Meyers-Milias-Brown Act (MMBA)1 by refusing to name a representative to an
interest arbitration panel and by refusing to participate in the impasse resolution procedures set
forth in the Charter for the City and County of San Francisco (City Charter). The City and
County of San Francisco (City) alleged that this conduct constituted a violation of MMB A
section 3509, subdivision (b) and PERB Regulation 32604, subdivision (d).2
1 MMBA is codified at Government Code section 3500 et seq. Unless otherwise indicated,
all statutory references herein are to the Government Code.
2 PERB regulations are codified at California Code of Regulations, title 8,
section 31001 et seq.

Local 39 argued that the interest arbitration provisions
of
the City Charter were
unreasonable and, therefore, not enforceable. In the alternative, Local 39 argued that interest
arbitration provisions were not mandatory. 	Consequently, even
if
these provisions were
enforceable, Local 39 did not violate the MMBA when it refused to comply with them. 	In
addition, Local 39 argued that the parties were not legitimately at impasse and, therefore, they
were not obligated to participate in the interest arbitration process. Local 39 also claimed the
charge was moot because the parties finalized a memorandum
of
understanding and that the
charge was not timely.
With regard to Local 39's defenses, the ALJ ruled that the charges were timely filed
and were not moot. 	With regard to the merits, the ALJ ruled that the interest arbitration
provisions were reasonable local rules and, therefore, enforceable. The ALJ also ruled that the
provisions were mandatory. Accordingly, the ALJ concluded that Local 39 violated the
MMBA by refusing to comply with the impasse provisions in the City Charter.
We have reviewed the entire record in this matter and find the proposed decision well-
reasoned, adequately supported by the record and in accordance with applicable law.
Accordingly, the Board hereby adopts the proposed decision as a decision
of
the Board itself,
subject to the following discussion regarding the mootness and timeliness issues.
DISCUSSION
A. 	Mootness
Subsection A (Mootness) of the "Procedural Defenses" section
of
the "Conclusions
of
Law" in the proposed decision is hereby replaced with the following discussion.
In Amador Valley Joint Union High School District (1978) PERB Decision No. 74
(Amador), the Board offered the following definition of mootness:
2

A case in controversy becomes moot when the essential nature of
the complaint is lost because of some superseding act or acts of
the parties. Mere discontinuance of wrongful conduct does not
ordinarily end the underlying controversy. 	There must be
evidence that the party acting wrongfully has lost its power to
renew its conduct. In cases clarifying the parties' rights and
obligations under a new law, the public interest is served by
deciding the underlying issue.
[Citations omitted.]
In Amador, the school district froze step-and-column wage increases at the beginning of
negotiations. In addition, the district released some questionable communications to district
employees. 	Shortly thereafter, the union filed an unfair labor practice charge alleging the
district's conduct violated the Educational Employment Relations Act (EERA).3 After the
charge was filed but before the formal hearing was held, the parties finalized a memorandum
of understanding. Additionally, the union sought and obtained a superior court judgment to
compel payment of the withheld salary increases.
At the formal hearing in Amador, the administrative law judge dismissed the complaint
as moot because the parties reached agreement on a contract and because the union recovered
back wages through a court action. PERB reversed, stating that the administrative law judge
failed to appreciate the potential unlawful nature of the employer's alleged coercive bargaining
conduct. In particular, the Board noted that neither the resolution of the court order nor the
conclusion of bargaining were relevant to the issue of the district's behavior during the course
of negotiations with the union. Accordingly, the Board concluded the matter was not moot.
In the instant case, like in Amador, the essential nature of the complaint is Local 39's
conduct during negotiations. The fact that the parties subsequently finalized an agreement
does not end the controversy. To the contrary, there is nothing in the record to suggest
3 EERA is codified at Government Code section 3540 et seq.
3

Local 39 will not continue to refuse to participate in the City Charter impasse provisions unless
it is compelled to do so by a third party. Accordingly, based on Amador and its progeny, we
find the issues in this matter are not moot.
B. 	Timeliness
Subsection B (Timeliness of the Charge) of the "Procedural Defenses" section of the
"Conclusions of Law" in the proposed decision is hereby replaced with the following
discussion.
Unfair practice charges filed under the MMBA are subject to a six-month statute of
limitations. 	(Coachella Valley Mosquito & Vector Control Dist. v. California Public
Employment Relations Bd. (2005) 35 Cal.4 th 1072, 1092.) The charging party is required to
file a charge within six months of the date it knows, or should have known, of the conduct
underlying the charge. (County of Siskiyou (2006) PERB Decision No. 1837-M.)
Section 8.409-4, subdivision (b) of the City Charter provides for a three-member
arbitration panel to resolve bargaining disputes. This section requires both the City and the
recognized employee organization involved in bargaining with the City to designate one
member for the panel "[n]ot later than January 20 of any year in which bargaining on an MOU
takes place." In addition, Section 8.409-4, subdivision (b) provides that all unresolved
bargaining disputes shall be submitted to binding arbitration.
In cases involving violations of local rules, the statute of limitations generally begins to
run when the rule is violated. Thus, in this case, the statute of limitations began to run for the
first violation in January 2006 when Local 39 refused to designate a member for the arbitration
panel. Next, the statute began to run for the second violation in April 2006 when Local 3 9
refused to participate in the impasse resolution procedures set forth in the City Charter.
4

Because the unfair practice charge was filed in May 2006, the conduct underlying the charge
occurred within the six-month limitation period and is, therefore, timely.
Local 39 argues that the statute of limitations in this case began to run on October 27,
2005, when Local 39 Business Representative, Stephanie Allan (Allan), told the City's
Director of Human Resources, Philip Ginsburg, and then-Deputy Director, Micki Callahan,
that the union would not participate in the City Charter impasse resolution procedures unless
the parties could "reach an agreement in principle" on wages before-hand. Since the charge
was not filed until May 10, 2006 -- more than six months from that date -- Local 39 concludes
the charge was not timely filed. 	However, Allan's statement was, at best, a threat of non-
compliance with the City Charter and was insufficient, standing alone, to trigger the running of
the statute of limitations. We, therefore, find the charge was timely filed.
ORDER
Upon the foregoing findings of fact and conclusions of law, and the entire record in this
case, it has been found that Stationary Engineers Local 39 (Local 39) violated the Meyers-
Milias-Brown Act (MMBA) by refusing to name a representative to an interest arbitration
panel and by refusing to participate in the impasse resolution procedures contained in the
Charter for the City and County of San Francisco (City Charter), in violation of the MMBA
section 3509, subdivision (b), and PERB Regulation 32604, subdivision (d) (Cal. Code Regs.,
tit. 8, § 32604, subd. (d)).
Pursuant to section 3509, subdivision (a), of the MMBA, it hereby is ORDERED that
Local 39, and its representatives, shall:
A. 	CEASE AND DESIST FROM:
1. 	Refusing to name a representative to an interest arbitration panel; and
5

2. 	Refusing to participate in the impasse resolution procedures contained in
the City Charter.
B. 	TAKE THE FOLLOWING AFFIRMATIVE ACTIONS DESIGNED TO
EFFECTUATE THE POLICIES OF THE MMBA:
1.	
Within ten ( 10) workdays
of
the service
of
a final decision in this matter,
post at its offices, employee organization bulletin boards, and all places where notices are
customarily placed, copies
of
the Notice attached hereto as an Appendix, and additionally to
distribute copies
of
the notice to all employees in the bargaining unit through the City
and
County
of
San Francisco's internal distribution system
if
that is the customary method
of
distributing union literature. The Notice must be signed by an authorized agent
of
Local 39,
indicating that Local 39 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.
2. 	Written notification
of
the actions taken to comply with this Order shall
be made to the General Counsel
of
the Public Employment Relations Board, or the General
Counsel's designee. Local 39 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 the City & County
of
San Francisco.
It is further Ordered 'that the proposed decision by the administrative law judge
in
Case
No. SF-CO-129-M is hereby AFFIRMED as modified by this Decision.
Acting Chair Dowdin Calvillo and Member Neuwald joined in this Decision.
6

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. SF-CO-129-M, City and County of
San Francisco v. Stationary Engineers Local 39, in which the parties had the right to
participate, it has been found that Stationary Engineers Local 39 violated the Meyers-Milias
Brown Act, Government Code section 3509, subdivision (b) and PERB Regulation 32604,
subdivision (d) (Cal. Code Regs., tit. 8, § 32604, subd. (d)), when it refused to name a
representative to an interest arbitration panel and refused to participate in the impasse
resolution procedures contained in the Charter for the City and County of San Francisco
(City Charter).
As a result of this conduct, we have been ordered to post this Notice and we will:
A. CEASE AND DESIST FROM:
1. Refusing to name a representative to an interest arbitration panel; and
2. Refusing to participate in the impasse resolution procedures contained in
the City Charter.
Dated: STATIONARY ENGINEERS LOCAL 39
By:
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.

STATE OF CALIFORNIA
PUBLIC EMPLOYMENT RELATIONS BOARD
CITY & COUNTY OF SAN FRANCISCO,
Charging Party,
V.
STATIONARY ENGINEERS LOCAL 39,
Respondent.
UNFAIR PRACTICE
CASE NO. SF-CO-129-M
PROPOSED DECISION
(04/11/07)
Appearances: Office of the City Attorney, by Gina Roccanova, Deputy City Attorney, for City
and County of San Francisco; Weinberg, Roger & Rosenfeld, by Stewari Weinberg, Attorney,
for Stationary Engineers Local 39.
Before Donn Ginoza, Administrative Law Judge.
PROCEDURAL HISTORY
City and County of San Francisco (City) initiated this action under the Meyers-Milias
1Brown Act (MMBA or Act) on May 10, 2006, by filing an unfair practice charge against
Stationary Engineers Local 39 (Local 39). On May 12, 2006, the Office of the General
Counsel of the Public Employment Relations Board (PERB or Board) issued a complaint
alleging that Local 39 violated the City's local rules when it refused to name a representative
to an interest arbitration panel and refused to participate in the impasse resolution procedures
prescribed by said rules.2 This conduct is alleged to violate section 3509(b) of the MMBA and
PERB Regulation 32604(d).3
1 The MMBA is found at Government Code section 3500 et seq. Unless otherwise
indicated, all statutory references are to the Government Code.
2 PERB denied the City's request for injunctive relief that accompanied the charge.
3 Section 3509(b) provides:
A complaint alleging any violation of this chapter or of any rules
and regulations adopted by a public agency pursuant to Section
1

3507 or 3507.5 shall be processed as an unfair practice charge by
the board. The initial detennination as to whether the charge of
unfair practice is justified and, if so, the appropriate remedy
necessary to effectuate the purposes of this chapter, shall be a
matter within the exclusive jurisdiction of the board. The board
shall apply and interpret unfair labor practices consistent with
existing judicial interpretations of this chapter.
PERB Regulations are codified at California Code of Regulations, title 8, section 31001 et seq.
PERB Regulation 32604(d) provides that it shall be an unfair practice for a public agency to:
Fail to exercise good faith while participating in any impasse
procedure mutually agreed to pursuant to Government Code
section 3505 or 3505.2 or required by any local rule adopted
pursuant to Government Code section 3507.
On May 19, 2006, an infonnal settlement conference was held, but the matter was not
resolved.
On June 14, 2006, Local 39 answered the complaint, denying the material allegations
and raising certain affirmative defenses.
On January 11, and 12, 2007, a formal hearing was conducted by the undersigned in
Oakland.
On March 2, 2007, the matter was submitted for decision following the filing of post-
hearing briefs.
FINDINGS OF FACT
The City is a "public agency" within the meaning of section 3501(c). Local 39 is an
"employee organization" within the meaning of section 3501 (a) and an "exclusive
representative" of a bargaining unit of public employees within the meaning of PERB
Regulation 32016(b).
Local 39's bargaining unit includes stationary engineers, stationary engineers 	sewage,
stationary engineers - water treatment, building and grounds maintenance superintendents,
Municipal Railway wire rope mechanics, and chief engineers.
2

City Charter Impasse Resolution Procedures
Beginning in the late 1970s and continuing to the early 1990s, wages for represented
employees
of
the City were established in accordance with City Charter provisions known as
the Salary Stabilization Ordinance. 	Wages were set pursuant to a salary survey, conducted by
the City's Civil Service Commission, which canvassed compensation levels
of
50 public and
private employers. An aspect about the process noted by one witness in the hearing was that
the ordinance dealt solely with wages, and improvements in fringe benefit levels could
not
be
achieved strictly through bargaining or the survey process.4
In 1990, the City suffered fiscal challenges as a result
of
the economic recession at the
time. 	Mayor Art Agnos elected to freeze wages in two consecutive years by vetoing the
increases resulting from the survey process. 	These wage freezes prompted lawsuits by the
City's unions. The City is known for its unit proliferation. It has recognized approximately 50
unions for bargaining purposes. In 1991, the City entered into negotiations with all
of
the
unions, seeking to obtain agreement to the 1991-1992 wage freeze and relinquishment
of
the
lawsuits against the mayor's veto for that year.
An idea that surfaced in these negotiations was to replace the Salary Stabilization
Ordinance with traditional bargaining together with binding interest arbitration. The police
and firefighter unions already had such a procedure by virtue
of
a 1990 Charter amendment.
Two
of
the City's larger unions favored this approach: Service Employees International
Union, the largest City union comprising three locals, and International Federation
of
Professional and Technical Employees, Local 21 (Local
21 ). 5 Carol Isen, a Local
21
senior
4 See United Public Employees v. City and County of San Francisco (1987) 190
Cal.App.3d 419 [235 Cal.Rptr. 4 77].
5 The size of the unions was estimated by the witnesses to be between 12,000 and
15,000 members for the three SEIU locals and between 1000 and 2000 for Local 21.
3

representative at the time, testified that her union's objective was to achieve the same system
in place for the police and firefighter unions. 	Some
of
the unions, especially the smaller crafts
unions, wanted to retain the salary survey process, fearing limited leverage in bargaining and
the high cost
of
negotiations relative to membership. 	The majority
of
unions desired to retain
the salary survey process as an option. 	Local 39 was one
of
these unions.
Where agreements could be reached in exchange for the wage freeze, written
agreements were executed. 	Local
21
reached agreement to have a City ballot initiative
presented to the electorate amending the City Charter to incorporate collective bargaining,
mediation and interest arbitration. Local 39's agreement, on the other hand, included
recognition
of
its option to remain under the Salary Stabilization Ordinance and a promise by
the City not to propose language removing its unit from the ordinance. As a result
of
these
agreements the City collectively obtained the benefit
of
a $64 million wage freeze.
Once these negotiations were concluded the City gave notice to all the unions inviting
them to participate in negotiations over the language
of
the proposed Charter amendment to be
carried by the City. As Jonathon Holtzman, the City's then-chieflabor attorney, explained, the
purpose for these negotiations was to comply with People ex rel. Seal Beach Police Officers
Assn. v. City
of
Seal Beach (1984) 36 Cal.3d 591 [205 Cal.Rptr. 794] (Seal Beach), which
mandates notice and opportunity for bargaining over a city's introduction
of
charter
amendments to the electoral process. The majority
of
the unions participated in these
negotiations. 	Those who were in favor
of
the status quo proposed a provision allowing an
opting out
of
bargaining and interest arbitration. These negotiations did not result in any
written memorandum
of
understanding (MOU) and the City did not believe such an agreement
was necessary under the Seal Beach decision. There was no evidence directly establishing that
Local 39 participated in these negotiations.
4

The City achieved several goals through the Seal Beach process. Anticipating the
administrative challenge
of
conducting and completing negotiations with its many unions, the
City sought and obtained clear and tight timelines for the interest arbitration process.
It
also
achieved more specific guidelines for decisionmaking by the arbitration panel than under the
procedures utilized by the police and firefighter unions,
as
well as clarification
of
the scope
of
representation so
as
to exclude matters addressed by the Civil Service Commission.
The wage bargaining/interest-arbitration initiative was placed on the November 1991
ballot as Proposition B. The proposed ordinance provided that bargaining disputes that
"remain unresolved after good faith negotiations
...
shall be submitted to a three-member
Board
of
Arbitrators
...
after an impasse has been declared" by either
of
the parties.
	One
of
the ballot arguments in favor
of
the measure stated that it would "allow employees the right to
negotiate wages and health benefits, like other employees throughout the State" and that it
would "require[] binding arbitration for peaceful resolution
of
labor disputes." The Ballot
Simplification Committee's analysis stated that "[e]mployee organizations would have a
choice for this extension
of
collective bargaining or having the terms
of
employment set as
they are now," but that "[t]he decision by an employee organization to choose collective
bargaining would be permanent."
Proposition B passed. The language
of
the proposition pertaining to impasse resolution
was adopted within section 8.409-4
of
the City Charter.
Section 8.409-4(a) provided that disputes remaining unresolved after good faith
bargaining were to be submitted (the word "shall" was employed) to a three-member
"mediation/arbitration board" "upon the declaration of an impasse either by the authorized
representative of the city and county of San Francisco or by the authorized representative
of
the recognized employee organization involved in the dispute." Isen, who participated in the
5

Seal Beach negotiations, testified that these provisions were intended to be mandatory once a
union had opted to leave the Salary Stabilization Ordinance process. 	Similarly, Holtzman
testified that once an employee organization opted in for collective bargaining, the impasse
resolution procedures accompanied that election.
Proposition B allowed any union the right to remain under the Salary Stabilization
Ordinance by requiring a one-time election upon the commencement of the new provisions. 	It
also provided that a union could, with notice, subsequently elect to opt into the new process.
These provisions, contained in section 8 .409-1, stated that any such election would be
irrevocable once made, and once made the salary survey procedures would no longer apply.
Section 8.409-4(b) provided that the three-member board would consist of one neutral
chairperson selected by agreement of the parties, and that each party to the dispute would
select one member "[n]ot later than January 20 of any year in which bargaining on an MOU
takes place." After naming of the parties' representatives, the neutral chairperson would be
selected by agreement, or if none, then by the alternate, strike-off procedure.
History of Bargaining under Proposition B
Four unions opted into bargaining, including the SEIU locals and Local 21. Local 39
was not one of them.
In 1995, Proposition F was placed on the ballot and passed by the voters. 	It eliminated
(with minor exceptions not pertinent here) the unions' option to remain under the Salary
Stabilization Ordinance.
Proposition F was motivated by the City's dissatisfaction with the original procedures,
owing in large part to an expensive arbitration award in 1993. The City was also dissatisfied
with the "package," case-presentation format, which prevented the arbitration panel from
deciding disputes on an issue-by-issue basis. In addition, the City desired to eliminate the
6

option to remain under the salary survey process due to what was perceived
as
the
"whipsawing," or leveraging, effect
of
the competing procedures. 	Holtzman asserted that the
perceived inequity
of
the system toward small unions has been solved as a practical matter
through a form
of
coalition bargaining, referred to as "pattern" bargaining, where early
agreements reached are typically followed by the other unions.
Proposition F was preceded by another round
of
Seal Beach negotiations before it was
placed on the ballot. Sections 8.401 and 8.407, which spelled out the salary survey process,
were repealed. Notable changes besides elimination
of
the option to remain under the salary
survey process included issue-by-issue detem1ination in interest arbitration, a requirement that
the arbitration panel consider each
of
a list
of
specified economic factors, and forfeiture
of
the
right to interest arbitration
if
the union engages in a strike. These changes were noted in
Proposition
F's
voter information pamphlets.
The impasse resolution procedures, now renumbered section A8.409-4(a)
of
the
Charter, provide in pertinent part:
Subject to Section [A]8.409-4(g), disputes pertaining to wages,
hours, benefits or other terms and conditions
of
employment
which remain unresolved after good faith bargaining between the
city and county
of
San Francisco, on behalf
of
its departments,
boards and commissions, and a recognized employee
organization representing classifications
of
employees covered
under this paii shall be submitted to a three-member
mediation/arbitration board ("the board") upon the declaration
of
an impasse either by the authorized representative
of
the city and
county of San Francisco or by the authorized representative of the
recognized employee organization involved in the dispute;
provided, however, that the arbitration procedures set forth in this
part shall not be available to any employee organization that
engages in a strike unless the parties mutually agree to engage in
arbitration under this section. 	Should any employee organization
engage in a strike either during or after the completion of
negotiations and impasse procedures, the arbitration procedure
shall cease immediately and no further impasse resolution
procedures shall be required.
7

Holtzman
testified that in the Seal
Beach
negotiations
over
Proposition F the
City emphasized
that
interest
arbitration was a
quid pro
quo for the right to strike. 	In addition,
the declaration
of
policy
in section A8.409 provides that any employee engaging in a strike shall
be
dismissed
from employment.
	One
of
the
proponent's
arguments stated that the initiative
proposed to
impose
a
"ban
on strikes
by
city workers."
Subdivision (b)
of
the section A8.409-4 provides;
Not later than
January 20
of
any year
in
which bargaining on an
MOU
takes place, representatives designated
by
the city and
county
of
San Francisco and representatives
of
the recognized
employee organization involved in bargaining pursuant to this
part shall each select and appoint one person
to the board.
The
third
member
of
the board shall
be
selected
by
agreement
between the city and county
of
San Francisco and the recognized
employee organization, and shall serve as the neutral chairperson
of
the board.
Since 1994, Local 39 has negotiated
MOUs with the City on six occasions. On
two
occasions the parties reached agreement without resort to the impasse resolution
procedures.
On two others, an agreement was reached during mediation. In the remaining two, an
agreement was imposed following interest arbitration. 	In the 1995 and 2004 negotiations,
Local 39 declared impasse, and in 1998, the parties mutually declared impasse. 	In all
but
one
of
these sessions - the one at issue here - Local 39 participated in selecting an arbitrator.
Typically five to six City unions move into the impasse resolution procedures
each
year. An average
of
two interest arbitration awards is rendered annually. 	Local 21 is
the
union
most often resorting to interest arbitration.
2004 Reopener Negotiations
2004 was a mid-term contract year for the parties. The City reopened on wages
and
retirement contributions. Local 39 as well as other unions had previously agreed to have their
members "pick up" (i.e., assume) the City's 7.5 percent contribution to the retirement fund.
8

This obligation was
scheduled to sunset at the end
of
2003. The City was interested
in
extending that arrangement into 2004 and through an additional contract year in 2005.
Local 39 Business Representative Stephanie Allan represented the union in these negotiations.
Negotiations led to impasse and subsequently to presentation
of
the dispute to an
arbitration panel. Matt Goldberg was the neutral
member
of
the panel.
At
the conclusion
of
the
parties'
presentation to the panel, Goldberg privately informed Local
39's
attorney,
W. Daniel Boone, from the firm
of
Weinberg, Roger and Rosenfeld,
of
his decision in advance
of
the written opinion. 	Boone, in turn, conveyed that message to Allan. 	Goldberg
admitted
that the union had made its case for its proposed wage increase and cessation
of
the retirement
contribution pick-up. 	However, Goldberg stated that he would not, and could not, vote
in
favor
of
Local
39's
position. He cited his unwillingness to break with the "pattern" set
by
other unions that had agreed to continuation
of
the employee pick-up in lieu
of
cost-cutting,
specifically through layoffs. 	As a result
of
this experience, Local 39 leadership resolved
not
to
participate in the mediation/interest arbitration procedures again. Asked whether Local
39
consented in 2004 to go to interest arbitration, Allan answered,
"We didn't
have any
choice,"
noting that at the time the MOU incorporated the impasse resolution procedures.
2006 Successor MOU Negotiations
Negotiations for a successor MOU were scheduled to commence in early 2006.
	On
October 27, 2005, the parties met for a preliminary meeting. Department
of
Human Relations
Director Philip Ginsburg and then-Deputy Director Micki Callahan represented the City. Allan
represented Local 39. Allan informed Ginsburg and Callahan that based on the union's
negative experience with interest arbitration in 2004, Local 39 would negotiate for an
agreement but not participate in the impasse resolution procedures. As to the issues in
bargaining, Allan focused on wages, asserting that the unit members lagged significantly
9

behind their private sector counterparts. 	After outlining the wage demands, Allan told
Ginsburg and Callahan that
"if
[Local 39] could reach an agreement in principle on [the wage
disparity issue], the Union would have no objection to going into the impasse arbitration
process."
Ginsburg affirmed the City's desire to reach agreement, notwithstanding Local
39's
anticipatory refusal to paiiicipate in the impasse resolution procedures. In December, Callahan
privately signaled the possibility
of
a significant wage increase but noted contingencies
of
a
political nature. In January 2006, Callahan indicated the City's continued exploration
of
financial wherewithal for a favorable economic package, but ultimately reported to Local 39
few prospects for a swift resolution. 	When the subject
of
impasse resolution procedures was
broached, Allan reiterated Local 39's intention not to participate. Callahan proposed to
commence bargaining and leave the impasse resolution procedures issue for the attorneys to
discuss.
Shortly thereafter, by letter dated January 31, 2006, Deputy City Attorney Gina
Roccanova noted Local 39's failure to name its designee to the three-member arbitration panel.
She reminded Local 39
of
the City's position that the impasse resolution procedures are
mandatory, urged Local 39 to submit its representative's name, and threatened legal action to
enforce the Charter's provisions. Notwithstanding these concerns, Roccanova pledged
the
City's intention in the interim to bargain in good faith toward an agreement.
By letter dated February 6, 2006, Boone responded to Roccanova on behalf
of
Local 39. 	Boone acknowledged both parties' intention to engage in good faith negotiations.
He also asserted that the impasse resolution procedures of the Charter are not mandatory.
Local 39 would continue refusing to choose its designated representative. 	Boone added that

"given the on-going, good faith bargaining," it would be "premature"
to
select impasse
arbitrators.
Negotiations commenced on February 2, and continued through April 7, 2006. 	There
were a total
of
11
sessions. 	Allan began
as
the spokesperson for Local 39' s bargaining team.
Local 39 Director
of
Public Employees Joan Bryant also participated in these negotiations, first
as
an assistant
to
Allan, then taking over Allan's seat as the team's spokesperson. 	Bryant
attended all but one
of
the
11
sessions.
Through her testimony, Allan asserted that the City's team, led by Isen, exhibited a lack
of
commitment to good faith negotiations and a predisposition to proceed swiftly to impasse.
At the first session, Local 39 proposed seven meeting dates in February; Isen agreed to
just
two
(February 3 and February 8). 	Isen was late for negotiations on numerous occasions. Bryant
recalled Isen stating at the first session that the City could declare impasse at any time.
Supporting Allan's general views, Bryant characterized Isen as habitually late, unprepared, and
cavalier.
At the third session on February 16, Isen, after leading Local 39 to believe the session
would last all day, appeared late for a second time and announced she would be leaving early
to attend other business. At the time, Isen offered no explanation for her tardiness. While
Bryant was out
of
the room, Isen asked Allan if,
as
to a future bargaining session, Local 3 9
would leave its "attack dog at home," referring to Bryant. Local 39 protested Isen's conduct in
a letter from Allan to Ginsburg the same day.
Isen was late for the fourth session on February 27. 	She took a personal call on
her
cellphone during presentations. 	By this session, the parties did begin to reach some tentative
agreements, which they initialed off. At the fifth session, the City delayed the start of the
session by 30 minutes.
11

The seventh session was cancelled and rescheduled to March 23. This session
did
not
begin until 1 :30 p.m. and was interrupted at the outset by a 45-minute City caucus.
Allan
testified that Isen withheld presentation
of
the City's economic proposal until this time, which
consisted
of
a wage proposal
of
2 percent in each
of
the three years
of
the proposed
MOU.
Allan also testified that Isen refused to put the City's proposal in writing until it was demanded
of
her.
At the eighth session (March 24), Local 39 offered a package proposal in which it made
concessions. The negotiations continued in the package-proposal mode thereafter.
At the ninth session (March 30), the pattern
of
City tardiness continued. 	Isen
arrived
at
12:20 p.m. and called a caucus 15 minutes after her arrival. 	Bryant indicated that Local 3 9 was
prepared to make additional movement by
offering a counterproposal. To facilitate the
preparation
of
this offer, Bryant requested information consisting
of
data on probationary
employees with the purpose
of
detem1ining how many went into extended probationary
periods. The City was proposing to extend the probationary period from six months to
one
year. 	In connection with the subject
of
cable-car employee differentials, Local 39 sought
information pertaining to numbers
of
vacant positions and the attendant salary savings. In
connection with fringe benefits, Local 39 requested information about the City's Wellness
Program. The City reiterated its March 23, three-year, wage proposal, and offered "additional
compensation and pay rates for classifications"
of
"[0].5" percent.
At the tenth session (April 6), Local 39 presented its second package proposal.
Local 39 included a proposal to confirm Isen's prior representation for "most-favored-nations"
treatment in exchange for an early agreement. 	Isen refused to put that offer in writing.
The
City made no further movement on its wage proposal, which amounted to 6 percent over three
years, though it did adjust its offer on the subject of wages for unit members possessing
12

multiple-licenses (increasing it to 5 percent), acceded to Local
39's
sewage classification
premium, and made movement toward Local
39's
pay increase for specific classifications
(chief engineer). 	Local
39's
wage proposal at this time was for 11.5 percent over three years.
At this session, Isen indicated she believed the parties were approaching impasse. Bryant did
not believe this to be the case, testifying that Local 39 was making movement, had room for
more movement, and the City had not yet responded to the outstanding information requests.
At the eleventh and final session (April 7), Isen again arrived late, and the City
immediately went into caucus. When Bryant inquired as to the reason for the caucus,
she
was
informed that the City was copying documents. Local 39 was prepared to present a proposal,
but Isen declared that the parties were at impasse and threatened to end the session. The City
had also not yet fonnally responded to Local
39's
fourth package proposal. 	Bryant
infonned
the City that Local 39 had room for movement. Local 39 was willing to drop its multiple-
license differential, make concessions on a parking proposal, and drop demands concerning
overtime and out-of-class compensation for airport employees. The City caucused again
without hearing Local
39's
presentation, returned and infonned Local 39 that the parties were
at impasse. 	In explaining its view for why the parties were at impasse, Isen asserted to
Local 39 that the parties were "still far apart on the core issues." She did not explain
her
position or identify what she believed were the core issues. The session ended, but Bryant did
succeed in giving Isen a new (written) package proposal. As to the general wages, Local
39's
proposal reiterated its previous proposal from April
6. 6
The City presented no rebuttal to Local 39's testimony regarding Isen's bargaining
conduct.
Bryant was offered the opportunity to compare the April 6 and April 7 proposal on
general wages to explain if Local 39 had changed its position. 	She was unable to identify that
there had been actual movement.
13

Holtzman testified that the term "impasse," as used in the Charter, adopts labor
law's
commonly understood meaning, namely, the point in negotiations
at
which the parties are
unable to make further progress.
Over the course
of
bargaining to that date, Local 39 had made approximately 30
proposals during the negotiations, the City offered between
15
and 20. 	By the last session
tentative agreements had been reached on
16
subjects. Eleven
of
those were based on
proposals made initially by Local 39. The City never formally responded to Local
39's
last
package proposal. 7
Sometime during bargaining, but no later than April, the City filed a superior court
petition to compel interest arbitration. 	The petition was denied.
On April 11, 2006, Allan wrote to Isen stating Local 3
9'
s readiness to continue
bargaining, following the City's "walk out"
of
the April 7 session. By letter dated April 13,
2006, !sen responded to infom1ation requests from Local 39. 	By letter dated April 14, 2006,
Isen asserted that the parties were at impasse by virtue
of
Local 39 having made no movement
on wages in its last two proposals, and asse1ied that impasse would only be broken by
"movement on the core economic issues." By letter dated April 18, 2006, Allan disputed this
point as being "not reflective
of
the facts as they occurred at the bargaining table." Two
additional letters were exchanged by the parties in which they disputed whether the
outstanding infonnation request involving sick leave usage had been satisfied. 	Sometime after
7 Administrative judicial notice is taken
of
the unfair practice charge filed by Local 39
against the City alleging surface bargaining on the City's part with respect to these
negotiations (case no. SF-CE-355-M). That charge was dismissed. On March 12, 2007,
PERB's affinned the board agent's dismissal of the charge for failure to state a prima facie
violation. 	(City & County of San Francisco (2007) PERB Decision No. 1890-M.)
14

negotiations had ceased, the City also informed Local 39 that it would return to the table
if
Local 39 agreed to mediation and interest arbitration.
Through the efforts
of
Bryant and Callahan, the parties eventually reached agreement
on a successor MOU sometime after May 2006.
ISSUES
1.
	Does the fact that the parties adopted a successor agreement to conclude the
negotiations render the action moot?
2. 	Since the City was on notice
of
Local
39's
intent not to participate in the
impasse resolution procedures more than six months prior to the filing
of
the charge,
should
the action
be
dismissed under the
MMBA's
six-month statute
of
limitations?
3. 	Are the City's impasse resolution procedures a reasonable local rule?
4. 	Is interest arbitration under the City Charter mandatory or permissive?
5. 	If interest arbitration is mandatory, did Local 39 violate the City Charter
by
failing to select the arbitration panel or was that requirement excused by the City's premature
declaration
of
impasse?
CONCLUSIONS OF LAW
Local 39 admits the key factual elements
of
complaint, namely, that it refused to
participate in the City Charter's impasse resolution procedures by failing to select the
arbitration panel and by refusing to proceed to interest arbitration. 	However it contends that it
was not legally obligated to participate in interest arbitration because that requirement
constitutes an unreasonable local rule. 	The interest arbitration requirement is inconsistent
with, and preempted by, MMBA's meet-and-confer obligation and the right to resort to
economic weapons (i.e., striking) in the event
of
bargaining impasse. 	Even
if
the requirement
withstands scrutiny, the Charter provisions are not mandatory and must be read so as to
15

preserve a
union's
right to resort to economic weapons. 	This conclusion stems from the fact
that the Charter states that the impasse resolution procedures cease to be available to the
parties
if
the union engages in a strike, thus affirmatively contemplating the union's option to
strike. 	Moreover, even
if
the procedures are both reasonable and mandatory, a legitimate
bargaining impasse was never reached due to the premature, bad faith, declaration
of
impasse
by the City, and thus the precondition for the impasse resolution procedures never occurred.
Lastly, Local 39 asserts that the action is procedurally barred on mootness and statute
of
limitations grounds.
The City contends that the impasse resolution procedures are reasonable because they
are consistent with the MMBA. 	The procedures are also mandatory, and the preconditions
of
good faith bargaining and legitimate bargaining impasse were met in this case. 	The City
rejects the procedurally-based defenses as being without merit.
Procedural Defenses
The City first contends that the procedural defenses were waived by Local
39's
failure
to assert them as affirmative defenses in the answer. 	I decline to find waiver because
the
defenses were raised during the hearing and there is no showing
of
prejudice. 	(Beverly Hills
Unified School District (1990) PERB Decision No. 789, pp. 12-13.) Both defenses were
identified in Local
39's
opening statement, thereby giving the City the opportunity during the
hearing to rebut those defenses, even assuming they were the type
of
defenses raising issues of
evidentiary proof. In fact, the factual underpinnings for the defenses are not disputed,
and
the
City was able to fully brief the issues prior to submission
of
the case for decision. (Cf.
Sonoma County Office
of
Education (1997) PERB Decision No. 1225, adopting proposed
decision of administrative law judge at pp. 10-11 [ affinnative defense not raised "during" the
hearing].)
16

A. 	Mootness
In Amador Valley Joint Union High School District (1978) PERB Decision No. 74,
PERB, relying on civil case law precedent, offered the following definition of mootness:
A case in controversy becomes moot when the essential nature of
the complaint is lost because of some superseding act or acts of
the parties. Mere discontinuance of wrongful conduct does not
ordinarily end the underlying controversy. 	There must be
evidence that the party acting wrongfully has lost its power to
renew its conduct. In cases clarifying the parties' rights and
obligations under a new law, the public interest is served by
deciding the underlying issues. 	(Id. at p. 5.)
In the cited case, the employer froze step-and-column wage increases at the outset of
negotiations. The administrative law judge dismissed the complaint as moot relying on the
parties ultimately reaching agreement on a contract and the union having recovered back
wages through a court action. PERB reversed, stating that the administrative law judge failed
to appreciate the potential unlawful nature of the employer's alleged coercive bargaining
conduct, and ordered the case remanded for a hearing on the merits. 	(Id. at pp. 4-5, 10,)
The Amador Valley case alludes to an exception to mootness applied by courts,
particularly appellate courts, where a controversy that is technically moot involves an issue of
public importance, which, if not addressed, will evade review or adjudication. (Amador Valley
Joint Union High School District, supra, PERB Decision No. 74, p. 5, fn. 4, citing Pittenger v.
Home Savings & Loan Assoc. (1958) 166 Cal.App.2d 32 [332 P.2d 399]; see also Sonoma
County Board of Education v. Public Employment Relations Bd. (1980) 102 Cal.App.3d 689,
693, fn. 3 [163 Cal.Rptr. 464].) Under this exception, the tribunal addresses the dispute in
order to "clarify" the parties' ongoing rights and obligations. (Cf. Paoli v. Cal. & Hawaiian
Sugar etc. Corp. (1956) 140 Cal.App.2d 854 [296 P.2d 31].)
This case is technically moot because the parties have entered into an MOU that
eliminates the need for Local 39's participation in the impasse resolution procedures - the
17

impetus for
the
unfair practice charge. 	Hence, a remedy for the negotiations now concluded
is
not
necessary
should the City prevail. 	Nevertheless, Local
39's
declaration that it will
no
longer abide
by
the Charter provisions for interest arbitration means the same controversy will
arise,
or
is likely to arise, in the future. 	(See County
of
Riverside (2003) PERB Decision No.
1577a-M, pp. 5-6.) I am called upon to determine whether the construction
of
the
Charter
provisions urged by Local 3 9 comports with the true meaning
of
those provisions:
whether
the
interest arbitration provisions are mandatory;
if
mandatory, whether they constitute a
reasonable regulation; and whether the absence
of
a legitimate bargaining impasse constitutes a
defense to the complaint. 	This case fulfills the requirements for adjudication notwithstanding
its technical mootness.8
B. 	Timeliness
of
the Charge
A six-month statute
of
limitations applies to unfair practice charges filed under
the
MMBA. 	(Coachella Valley Mosquito & Vector Control Dist. v. California Public Employment
Relations Bd. (2005) 35 Cal.4th 1072, 1092 [29 Cal.Rptr.3d 234].) The charging party is
required to file a charge within six months
of
the date it knows, or should have known,
of
the
conduct underlying the charge. (County
of
Siskiyou (2006) PERB Decision No. 1837-M,
pp. 3-5.)
Local 39 first communicated its intent not to participate in the impasse resolution
procedures on October 27, 2005, when Allan met with Ginsburg and Callahan to discuss the
upcoming negotiations. 	The charge was not filed until May 10, 2006, which is more
than
six
months from that date. 	On this basis, Local 39 argues, the charge was not timely filed
..
8 Local 39 did not introduce the MOU into evidence. 	Thus I have no basis to conclude
that the City waived its right to prosecute its charge by the tenns of
that agreement. (See
Oakland Unified School Dist. v. Public Employment Relations Bd. (1980) 120 Cal.App.3d
1007, 1010-1011 [175 Cal.Rptr. 105].)

Relying on breach
of
contract principles - anticipatory breach, specifically - the City
responds that the statute
of
limitations does not run until performance is due, under the
rule
that the non-repudiating party may elect to immediately sue for performance or wait until
performance is due.
	(Romanov.
Rockwell Internat., Inc. (1996) 14 Cal.4
th
479,489
[59 Cal.Rptr.2d 20].) Under the same rules, because the Charter does not require that parties
select the arbitration panel until January 20, Local 39 defaulted on its obligation at that
subsequent time as well. Alternatively, Local 39 committed a "second" unfair practice
when
it
refused after April 7 to move into the impasse resolution procedures. 	And finally, since
the
complaint alleges that Local
39's
conduct was "continuing" after the initial breach and
Local 39 admitted that allegation, the violation is a continuing one.
In San Dieguito Union High School District (1982) PERB Decision No. 194,
PERB
adopted the continuing-violation theory from National Labor Relations Act (NLRA)9 cases,
where the duty to bargain is recognized to be a continuously nmning obligation (either during
negotiations
or
during the life
of
the relationship). (Id. at pp. 6-9.) Subsequently,
PERB
applied the theory in two access cases. (Long Beach Unified School District (1987)
PERB
Decision No. 608, pp. 11-13 [regulation denying access rights]; State
of
California
(Departments
of
Personnel Administration, et al.) (1998) PERB Decision No. 1279-S, adopting
proposed decision
of
administrative law judge at p. 32 [ discriminatory access policy].)
Within the context
of
continuing violations, the cases also recognize that
if
the charged
party commits some additional act within the limitations period that could be said to "revive"
its unlawful conduct, the period commences anew. 	(San Dieguito Union High School District,
supra, PERB Decision No. 194, p. 10.) In a recent application
of
the rule to a challenge to the
reasonableness of a local rule, PERB concluded that an actual controversy had not arisen
9 The NLRA is codified at 29 U.S.C. section 151, et seq.
19

during the limitations period and upheld the dismissal of the complaint on lack of timeliness
grounds. 	(County of Orange (2006) PERB Decision No. 1868-M, pp. 3-4 [challenge to super-
majority, proof-of-support rule dismissed where charging party failed to submit list of
support].)
Unilateral changes, though involving a breach of the duty to bargain, are not continuing
violations. 	(San Dieguito Union High School District, supra, PERB Decision No. 194,
pp. 9-10.) The limitations period is also not revived each time the new policy is enforced.
(San Dieguito Union High School District, supra, PERB Decision No. 194, pp. 8-1 O; see also
Riverside Unified School District (1985) PERB Decision No. 522.)10
Allan testified that following the 2004 interest arbitration Local 39 resolved never to
engage in the impasse resolution procedures "again." Although this could be construed as the
union's intention to change its policy with respect to interest arbitration, I decline to find that
the unilateral change rule on continuing violations applies here because Allan's testimony with
respect to her meetings with Ginsburg and Callahan do not establish that she took such an
unequivocal position on behalf of Local 39. 	She testified that she told the City representatives
that Local 39 would participate in interest arbitration on one condition: that there be an
agreement in principle on the wage disparity issue going into the negotiations. Thus, if
Local 39 had indeed intended to establish a new policy, it did not convey that point to the City
more than six months prior to the filing of the charge.
10 Were the rule otherwise there would be no finality to an employer's decision to
change policy. Also a specific rule for the commencement of the limitations period has been
applied in unilateral change cases. The period commences when the charging party has "actual
or constructive notice of the respondent's clear intent to implement the change [in policy],
providing that nothing subsequent to that date evinces a wavering of that intent." (Regents of
the University of California (1990) PERB Decision No. 826-H, pp. 7-8.)
20

I also find that Local
39's
refusal to participate in the impasse resolution procedures
was a continuing violation because, like the duty to bargain, participation in those procedures
is a continuing obligation while the parties seek to reach agreement on a new contract.
(See
Regents
of
the University
of
California (1985) PERB Decision No. 520-H,
p.
23.) And it
continues into the future with respect to each new MOU negotiations. 	An actual, continuing
controversy existed, or was at least revived in April 2006, when the City declared impasse and
Local 39 refused once again to proceed into the impasse resolution procedures. (Cf.
County of
Orange, supra, PERB Decision No. 1868-M.) Significantly, both parties "agreed to disagree"
on the correctness
of
Local
39's
interpretation
of
the Charter, while they endeavored to
complete the scheduled bargaining. As Boone stated in his February 6 letter to Roccanova,
selection
of
the arbitration panel at that time would have been "premature" given the
parties'
willingness to negotiate. That letter, which arguably asserts in categorical terms that the
provisions are not mandatory, is within the limitations period. The charge was timely filed.
Reasonableness
of
the Impasse Resolution Procedures
A. 	General Principles and Local 39's Contentions
The MMBA requires public agencies to meet and confer in good faith with employee
organizations regarding "wages, hours, and other tenns and conditions
of
employment.
...
"
(Sec. 3505.) The meet-and-confer obligation requires that the parties "endeavor to reach
agreement on matters within the scope
of
representation." (Sec. 3505.) The meet-and-confer
process is intended to "promote full communication between public employers and their
employees by providing a reasonable method
of
resolving disputes regarding wages, hours and
other tenns and conditions
of
employment.
...
" (Sec. 3500(a); see Claremont Police Officers
Assn. v. City
of
Claremont (2006) 39 Cal.4
th
623, 630 [47 Cal.Rptr.3d 69].)
21

The MMBA
authorizes public agencies to
"adopt
reasonable rules and regulations for
the administration
of
employer-employee relations," including "additional procedures for
the
resolution
of
disputes involving wages, hours and other terms and conditions
of
employment,"
and
"any
other matters that are necessary to carry out" state law. 	(Sec. 3507(a)(5).) It
also
"does
not
prescribe the manner in which an agreement between a local government and
employee organization should
be put into effect.
...
" 	(United Public Employees v.
City and
County
of
San
Francisco, supra, 190 Cal.App.3d 419, 423.)
Where
a local rule adopted
by
a public agency conflicts with the
MMBA
and its
fundamental purposes, enforcement
of
such a rule will
be
denied. 	(International
Brotherhood
of
Electrical Workers v. City
of
Gridley (1983) 34 Cal.3d 191, 196-206 [193 Cal.Rptr.
518).)
The City
of
Gridley court noted that the scope
of
authority to supplement provisions
of
the
statute
must be
"consistent with, and effectuate the declared purposes of, the statute as a
whole."
	(M,_
at p. 202, citation omitted.) There, a rule sanctioning an unlawful strike
by
decertifying the recognized union was found to
be
unreasonable. 	(Id. at pp. 199-206;
see
also
Huntington Beach Police Officers' Assn. v.
City
of
Huntington Beach (1976) 58
Cal.App.3d
492, 502-503 [129 Cal.Rptr. 893] [removal
of
a negotiable subject from the scope
of
representation]; Santa Clara County Counsel Attnys. Assn. v. Woodside (1994) 7 Cal.4 th
525,
538-542 [28 Cal.Rptr.2d 617] [rejecting a local policy restricting the employees' right to sue to
enforce the MMBA over issues
of
impasse].) The burden
of
proving unreasonableness is on
the party challenging the rule. 	(City & County
of
San Francisco, supra, PERB Decision
No. 1890-M, p. 7.)
Local 39 contends that interest arbitration conflicts with the MMBA's "intent that
agreements be reached by bargaining, rather than being imposed by the unilateral declaration
of one side
of
the bargaining process." Agreements should be the result of compromise and a
22

"reasonable accommodation of the needs of both parties." Unclear is whether Local 39 claims
that interest arbitration is antithetical per se to the purposes of the MMBA. On the one hand,
Local 39 asserts:
Mandatory interest arbitration does not result in an agreement
between the parties. The resulting conditions are imposed on
both sides. The conditions imposed by the Board of Arbitration
were proposed by one or the other side. This is not a case where
the parties agreed in advance to abide by the decision of the
Board of Arbitration. In this case there is no agreement to be
bound by the decision of the Board of Arbitration.
At the same time, Local 39 contends that what also causes the Charter to conflict with the
MMBA so as to be preempted is that the Charter, as interpreted by the City, "permits either
side to declare an 'impasse' cutting off further negotiations and having a third party dictate
wages, hours, and conditions of employment ...[which] is not negotiating."11 Apart from
whether the procedures themselves, or their construction and application, result in
unreasonableness, Local 39 contends they violate the MMBA by depriving a union of its right
to strike.
As noted above (fn. 7, ante), Local 39 filed a bad faith bargaining unfair practice
charge against the City arising from these negotiations. The charge was dismissed at the
investigation stage, and the board agent's dismissal was upheld. (City & County of San
Francisco, supra, PERB Decision No.1890-M.) One of Local 39's arguments was addressed
in the Board's decision. Against the argument that the impasse resolution procedures
constitute a "contract of adhesion " and are facially unreasonable because they "insulate the
Local 39 contends that the Charter's interest arbitration procedures are preempted by
the MMBA. Its argument is that preemption results from irreconcilable conflict, not the
Legislature's intent to occupy the field of impasse resolution procedures to the exclusion of all
local rulemaking. (See Bishop v. City of San Jose (1969) 1 Cal.3d 56, 62 [81 Cal.Rptr. 465];
Los Angeles County Firefighters Local 1014 v. City of Monrovia (1972) 24 CaLApp.3d 289,
295 [101 Cal.Rptr.78].)
23

[City] from any Union proposal which it unilaterally deems to be objectionable," PERB held
that the Charter provisions are reasonable on their face. 	(Id. at pp. 6, 9.) Local 39 based its
argument on the claim that the provisions are drafted in such a way as to allow the City to
declare impasse in bad faith or when no legitimate impasse exists. (Id. at p. 6.) 	Citing
references in the Charter to the parties' obligation to meet and confer in good faith, PERB
concluded that its provisions must be read so as to "restrict the use of the impasse procedure to
situations where disputed issues remain unresolved after good faith bargaining." (Id. at p. 9.)
PERB also held that the procedures were not invalid as applied because Local 39's proffered
evidence failed to demonstrate bad faith bargaining. (Id. at pp. 6, 9-10.)
Because the issue of facial unreasonableness based on the ability to prematurely declare
impasse has been decided, I will only address Local 39's other two arguments here.
B. 	Accommodation of the Right to Meet and Confer
In Countv Sanitation Dist. No. 2 v. Los Angeles County Employees' Assn. (1985)
38 Cal.3d 564 [214 Cal.Rptr. 424], cert. den. (1985) 474 U.S. 995 (County Sanitation), our
supreme court made the following observation:
[T]he MMBA contains no clear mechanism for resolving
disputes. 	It merely provides that if the parties fail to reach an
agreement, they may agree to appoint a mediator or use other
impasse resolution procedures agreed upon by the parties. (Id. at
p. 572, fn. 14, original italics.)
Expanding on the point, County Sanitation made a second, more general observation, quoting
fonner Justice Grodin's analysis of the MMBA:
The entire subject of strikes and impasse resolution procedures
[under the Act] is avoided, except for the declaration that the
parties may elect to engage a mediator. What emerges is a rather
general legislative blessing for collective bargaining at the local
governmental level without clear delineation of policy or means
for its implementation. The courts have, on the whole, done an
admirable job of exegesis, but their decisions cannot help but
reflect the underlying weakness of the text. (Id. at p. 572, fn. 15,
24

citing Grodin, Public Employees Bargaining in California: The
Meyers-Milias-Brown Act in the Courts (1972) 23 Hastings L.J.
719, 761.)
The California Supreme Court recently struck down statewide legislation mandating
police and firefighter interest arbitration for county governments on grounds that it violated
two provisions of the state constitution. In doing so however, the court acknowledged that
public entities are permitted to voluntarily establish provisions for interest arbitration.
(County of Riverside v. Superior Court (2003) 30 Cal.4 th 278,284 [132 Cal.Rptr.2d 713]
(County of Riverside); see also sec, 3548.5; cf. Bagley v. City of Manhattan Beach (1976)
18 Cal.3d 22, 27, fn. 1 [132 Cal.Rptr. 668] [general-law cities prohibited from delegating wage
setting].) A number of charter cities in California have adopted interest arbitration.
(See Zerger, et al., California Public Sector Labor Relations (Matthew Bender 2006) p. 12-19,
fn. 3; see also Lab. Code, sec. 1164 [interest arbitration enacted in 2002 under Agricultural
Labor Relations Act].) The Bagley court observed in 1976 that "[p]robably no issue in recent
years has been presented to the Legislature more frequently than proposed arbitration of public
employee salaries .... " (Bagley v. City of Manhattan Beach, supra, 18 Cal.3d at p. 26.)
As noted, County Sanitation, supra, 38 Cal.3d 564, observed that the Legislature
provided little guidance on how bargaining impasses are to be resolved, while noting the
statute's express language authorizing parties to agree to mediation and "other" impasse
resolution procedures. 	(Id. at p. 572; see secs. 3502.2, 3505.4.) But County Sanitation, and
County of Riverside's comment of similar note, in no way express an intent that public
agencies are prohibited from adopting mandatory impasse resolution procedures.
(Sec. 3507(a)(5) ["Additional procedures for the resolution of disputes involving wages, hours
and other terms and conditions of employment."]; sec. 3505 [adequate time should be allocated
"for resolution of impasses where specific procedures for such resolution are contained in local
25

rule, regulation or ordinance").) Indeed, offering specific evidence to the contrary, section
3505.4 reveals that the Legislature contemplated interest arbitration, either as a result of
contractual agreement or local ordinance. It provides, in pertinent part:
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 im~lement a memorandum of understanding ....
(Italics added.) 1
Nor does the fact that Local 39 historically opposed collective bargaining and interest
arbitration by itself render the local rule unreasonable. Under Seal Beach, it is contemplated
that local rules will be implemented through the electoral process (and thus sometimes over the
objection of unions), subject to judicial review for unreasonableness. 	Implicit in Local 39's
argument is the notion that the MMBA embodies an anti-majoritarian principle whose
imperative is heightened in the context of the City's many small unions. However, I find
nothing inherent in the purposes of the MMBA or labor law more generally that forbids
imposition of interest arbitration over the opposition of such unions in charter cities. (See
Fire Fighters Union v. City of Vallejo (1974) 12 Cal.3d 608 [116 Cal.Rptr. 507]; San Francisco
Fire Fighters v. City and County of San Francisco (1977) 68 Cal.App.3d 896, 902-903 [ 13 7
Cal.Rptr. 607]; Hess Collection Winery v. Agricultural Labor Relations Bd. (2006) 140
Cal.App.4 th 1584, 1597-1601 [45 Cal.Rptr.3d 609].) To the extent that Local 39 opposed
interest arbitration in lieu of the salary survey process, its argument is diminished by the fact
that interest arbitration includes some of the same economic factors as the salary survey
process, holds the prospect of leveling the bargaining field for small unions, allows the union a
But see Bagley v. City of Manhattan Beach, supra, 18 Cal.3d at pp. 25-26, 27, fn. l
(questioning statutory support for interest arbitration within the MMBA).
26

direct role in choosing the decisionmakers, and follows full collective bargaining over a wider
range
of
economic issues than under the previous process. As indicated in this case, it is
commonly known that many unions believe interest arbitration to serve their interests.
13
The language
of
the statute cited by Local 39, requiring parties to meet and confer in
good faith for the purpose
of
reaching a contract agreement, is also not inconsistent with
interest arbitration. The role
of
impasse resolution procedures in general is well established in
California public sector labor law. They are intended to produce resolution in bargaining
disputes after good faith negotiations fail to achieve their intended purpose so as to prevent
disruption
of
important governmental services to the public. (See Modesto City Schools
(1983) PERB Decision No. 291, pp. 34-36, overruled on other grounds in Compton Unified
School District (1987) PERB Order No. IR-50; City & County
of
San Francisco, supra, PERB
Decision No. 1890-M, p.
9;
San Diego Teachers Assn.
v.
Superior Court (1979) 24 Cal.3d
1,
8
[154 Cal.Rptr. 893].) Impasse resolution procedures are in some sense a sine qua non feature
distinguishing the public sector from the private sector. 	(See Modesto City Schools, supra,
PERB Decision No. 291, pp. 34-36.) The value
of
interest arbitration in producing reasonable
contract terms while avoiding strikes cannot be gainsaid. (Sec. 3500(a) [MMBA's purpose to
"promote the improvement
of
personnel management and employer-employee relations"].)
C.	
Forfeiture
of
the Right To Strike
Forfeiture
of
the right to strike in exchange for interest arbitration is the second prong
of
Local 39's attack on the local rule. 	Based on the lack
of
a common law prohibition
of
the
right to strike, it has been held that there is in effect a qualified right
of
public employees to
Current proposed legislation in Congress to amend the NLRA, known as the
Employee Free Choice Act, includes mediation and arbitration for first bargaining contracts if
the parties fail to reach agreement within certain time periods. It has been noted that the bill
(H.R. 800) is supported by unions and opposed by business groups. 	(Lab. Relations Rptr.
(Bur. of Nat. Affairs, Apr. 2, 2007) vol. 181, pp. 292-293.)
27

strike under the MMBA. 	(County Sanitation, supra, 38 Cal.3d at pp. 572-573, 585; see also
Los Angeles Metropolitan Transit Authority
v.
Brotherhood
of
Railroad Trainmen (1960)
54 Cal.2d 684, 689
[8
Cal.Rptr. 1].) County Sanitation rejected the common-law prohibition
theory in part because
of
the absence
of
empirical evidence that public employee strikes
resulted in employer capitulation to unreasonable demands, and because a number
of
services
provided
by
public employees are not "essential" functions. 	(County Sanitation, supra,
38 Cal.3d at pp. 577-579.) Whether or not such strikes are frequent or effective, as a practical
matter unions do exercise leverage in public sector bargaining as a result
of
the threat
of
striking.
The courts have never held that MMBA impasse resolution procedures effectively
eliminating this right to strike are reasonable local rules, as the issue has not been presented in
this fashion. 	And true, unlike the interest arbitration process, the impasse resolution
procedures under the Educational Employment Relations Act (EERA)
14
and Higher Education
Employer-Employee Relations Act (HEERA)
15
do not culminate in a binding decision
on
contract terms, thus enabling the union to exercise its qualified option to strike following
exhaustion
of
the impasse procedures. (Secs. 3548-3548.8, 3589-3594; see Compton Unified
School District (1987) PERB Order No. IR-50.)
16
Further, the statement in County
of
Riverside, supra, 30 Cal.4
th
278, that public agencies may voluntarily adopt interest arbitration
14
The BERA is codified at section 3540, et seq.
15
The HEERA is codified at section 3560 et seq.
16
The Ralph C. Dills Act (codified at sec. 3512 et seq.) (Dills Act) contemplates that
PERB will make impasse detenninations, but no additional procedures are prescribed.
	If
PERB appoints a mediator, the mediator will report to PERB when mediation efforts have been
exhausted and impasse exists, setting the stage for the State's implementation of its last, best
and final offer.
28

is only dicta as to the issue here. That said, as Local 39 acknowledges, there is a "strong
public policy in California favoring peaceful resolution of employment disputes by means of
arbitration." (Fire Fighters Union v. City of Vallejo, supra, 12 Cal.3d 608, 622.) In 2003, the
Legislature amended the statewide interest arbitration statute for police and firefighters (Code
of Civ. Proc., sec. 1299 et seq.) in the wake of County of Riverside to preserve use of the
procedure as a means of impasse resolution. (Stats. 2003, ch. 877; see Code of Civ. Proc., sec.
1299.7, subd. (c).) Charter cities continue to be required to have interest arbitration for police
and firefighters, if they did not already have such provisions. (Code of Civ. Proc., sec. 1299.9,
subd. (a).) And while binding grievance arbitration is not quasi-legislative like interest
arbitration, it has long been recognized as a means of resolving the meaning of contract terms
during the life of the contract through a form of "continuous bargaining," and thus a
mechanism promoting labor peace in a manner equitable to both sides. (United Steelworkers
of America v. Enterprise Wheel & Car Corp. (1960) 363 U.S. 593,596 [46 LRRM 2423];
United Steelworkers of America v. Warrior & Gulf Navigation Co. (1960) 363 U.S.574, 581-
582 [ 46 LRRM 2416].) 17 The Legislature has placed a premium over the years on labor peace
in the public sector, and labor's "sacrifice" here is tempered by its potential to achieve contract
tenns not even ensured by striking.
I conclude that mandatory binding interest arbitration does not conflict with the
MMBA, its meet-and-confer obligation or its qualified right to strike, and is therefore not
unreasonable. (See also City & County of San Francisco, supra, PERB Decision No. 1890-M
[premature-declaration-of-impasse argument rejected].)
The quasi-legislative characterization has arisen in the more limited context of
unlawful delegation of powers. (See, e.g., Bagley v. City of Manhattan Beach, supra, 18
Cal.3d 22; County of Riverside, supra, 30 Cal.4th 278.)
29

Interest Arbitration as Mandatory or Permissive
Local 39 reads the language of the impasse resolution procedures so as to preserve a
union's option to strike rather than be bound by an interest arbitration award; hence, interest
arbitration is not mandatory. 	Local 39 reasons that Proposition F resulted in maintenance of
the right to strike, as evidenced by the following language of A8.409-4(a):
[P}rovided, however, that the arbitration procedure set forth in
this part shall not be available to any employee organization that
engages in a strike unless the parties mutually agree to engage
in arbitration under this section. 	Should any employee
organization engage in a strike either during or after the
completion of negotiations and impasse procedures, the
arbitration procedures shall cease immediately and no further
impasse resolution procedures shall be required. (Italics
added.)
Local 39 contrasts the language under A8.409-4(a), the provisions introducing the arbitration
panel but containing the "provided however" language, with section A8.409-4(d), the
provisions on submission of disputes to the arbitration panel, which are stated in language that
is mandatory throughout. 18
The basic canon of statutory interpretation is that the intent of the legislating body is to
be effectuated. (Long Beach Police Officers Assn. v. City of Long Beach (1988) 46 Cal.3d
736, 741 [250 Cal.Rptr. 869].) Ascertaining legislative intent begins with examination of the
18 Section A8.409-4(d) provides:
In the event no agreement is reached prior to the conclusion of
the arbitration hearings, the board shall direct each of the paiiies
to submit ... a last offer of settlement of each of the remaining
issues in the dispute. The board shall decide each issue by
majority vote. . . . In addition, the board shall issue written
findings on each and every one of the above [economic] factors
as they may be applicable to each and every issue determined in
the award. 	Compliance with the above provisions shall be
mandatory. 	(Italics added.)
See also section A8.409-4(b).
30

words
of
the statute. 	(Ibid.) Statutory language is first to be given its usual and ordinary
meaning. 	(Halbert's Lumber, Inc.
v.
Lucky Stores, Inc. (1992) 6 Cal.App.4 th 1233, 1240
[8
Cal.Rptr.2d 298].) If possible, significance is given to every word, phrase, sentence and
part
of
a statute. 	(Harroman Co.
v.
Town
of
Tiburon (1991) 235 Cal.App.3d 388, 394-395
[1
Cal.Rptr.2d 72].)' Particular language must be construed with reference to the entire
statutory scheme
of
which it is a part. (Select Base Materials
v.
Board
of
Equal. (1959)
51
Cal.2d 640, 645 [196 Cal.Rptr. 38].) To resolve ambiguity, reference may be made to the
statute's legislative history and statutory context. (Long Beach Police Officers Assn. v. City
of
Long Beach, supra, 46 Cal.3d at p. 743.) In construing an initiative measure adopted
by
the electorate, the intent
of
the framers
of
the measure and the situation intended to be
remedied, as well as the ballot arguments submitted to the electorate explaining the measure,
may be considered. 	(Carter
v.
Seaboard Finance Co. (1949)
33
Cal.2d 564, 579, 582
[203 P.2d 758]; In re Quinn (1973) 35 Cal.App.3d 473,483 [110 Cal.Rptr. 881].)
Section A8.409-4(a) states that unresolved disputes "shall" be submitted to binding
arbitration. 	The use
of
"shall" generally connotes a mandatory obligation. 	(Cole
v.
Antelope
Valley Union High School Dist. (1996) 47 Cal.App.4th 1505, 1511-1513 [55 Cal.Rptr.2d
443].)
The language
of
section A8.409-4(a) cited by Local 39, reasonably read in the context
of
the entire ordinance
of
which it is a part, provides that interest arbitration is forfeited
by
any union engaging in a strike. 	Stated differently, the penalty for striking is the union's
inability to proceed to interest arbitration, unless the City chooses to ignore the strike.
The
language serves to deter pre- as well as post-impasse-resolution-procedures strikes. Local
39's focus on the language "unless the parties mutually agree to engage in arbitration"
removes a selected phrase from the context of its surrounding language. The cited language
31

does not reasonably suggest that interest arbitration is an "alternative" approach to impasse
resolution. 	Such a construction would render the provisions largely ineffective. 	(Cole v.
Antelope Valley Union High School Dist., supra, 47 Cal.App.4
th
at pp. 1512-1513, citing
Hogya
v.
Superior Court (1977) 75 Cal.App.3d 122, 134 [142 Cal.Rptr. 325]; Frances
v.
Superior Court (1935) 3 Cal.2d 19, 28 [43 P.2d 300]; Posner
v.
Grunwald-Marx, Inc. (1961)
56 Cal.2d 169, 180 [ 14 Cal.Rptr. 297].)
Furthermore, the City's view
of
the intent
of
the Charter language,
as
explained
by
Holtzman, that interest arbitration is a quid quo pro for forfeiture
of
the right to strike,
was
not
contradicted by any extrinsic evidence from Local 39. Isen, though not a disinterested
witness, confirmed this understanding from Local
21
's
perspective, one
of
the unions
originally seeking interest arbitration. The City's understanding comports with the notion that
a contractual no-strike clause is the quid pro quo for binding grievance arbitration during the
life
of
the contract and that arbitration exists in tandem with the continuing duty to bargain in
regard to filling in the meaning
of
disputed contract terms. 	(Boys Market Inc.
v.
Retail
Clerk's Union (1970) 398 U.S. 235, 247-248 [74 LRRM 2257]; see also Posner v. Grunwald-
Marx, Inc., supra, 56 Cal.2d at pp. 183-185; United Steelworkers
of
America v. Enterprise
Wheel & Car Corp., supra, 363 U.S. 593, 596; United Steelworkers
of
America v.
Warrior &
Gulf Navigation Co., supra, 363 U.S. 574, 581-582.) More important perhaps than the
subjective understanding
of
the drafters
of
initiatives is the language
of
the Charter itself and
the ballot arguments submitted to the electorate. 	(See Mazzola
v.
City and County
of San
Francisco (1980) 112 Cal.App.3d 141, 152 [169 Cal.Rptr. 127].) As even Local 39
acknowledges, section A8.409 ("Declaration
of
Policy") declares that strikes by City
employees are not in the public interest. 	Proposition F emphasized this point, adding the
language authorizing the termination of employees who engage in a strike. (Id.; see
32

Fire Fighters Union
v.
City
of
Vallejo, supra, 12 Cal.3d at pp. 613-614, fn. 3.) The ballot
arguments for Proposition F specifically noted that the right to strike was being eliminated by
the initiative. 	The legislative history confirms that the right to proceed to interest arbitration
( or benefit from any award) is forfeited by the union that engages in a strike, not that interest
arbitration and striking are options available to the union from the outset.
19
I find that interest arbitration under the Charter is mandatory for Local 39.
The City's Declaration
of
Impasse
A. 	Defense
of
Premature Declaration
of
Impasse
Local 39, both here and in its charge against the City, argued that the City Charter, as
interpreted and applied by the City, sacrifices the union's bargaining rights because the
City
can prematurely declare impasse. In fact, Local 39 argues that the Charter permits the
City
to
declare impasse at any time, triggering without more the impasse resolution procedures.
Local 39 argues this theory as an alternative to its claim, discussed below, that the Charter
must be read as requiring that impasse be legitimate, not merely based on the arbitrary
or
subjective judgment
of
one party, in order for the imposition
of
interest arbitration to
be
reasonable. 	As noted above, PERB rejected the argument that the procedures were
inconsistent with the MMBA for this reason, on their face and as applied. 	PERB found that the
Charter contains a duty to meet and confer in good faith, which impliedly requires that a
declaration
of
impasse be made in good faith. 	(City & County
of
San Francisco, supra, PERB
Decision No. 1890-M, p. 9.)
19
The impasse resolution procedures provide the City with the option to impose its last,
best and final offer and terminate striking employees
if
the union engages in a strike. Local 39
suggests that the legality of these provisions is questionable in light of County Sanitation,
supra, 38 Cal.3d 564. I need not address whether the Charter's strike penalty provisions
constitute an unreasonable local rule because that issue is not before me. 	The legislative intent
of the electorate is the salient point derived from this evidence.
33

It
is true that the Charter does not provide a definition
of
impasse.
	It
only states that the
impasse resolution procedures are triggered when one party declares impasse in the
negotiations. 	However, since impasse is a term
of
art in labor relations, because the only
extrinsic evidence in the record is that from Holtzman, who testified its traditional meaning in
labor relations was the meaning intended by the drafters, and because it makes logical sense, I
find that impasse has the meaning ascribed to it by Holtzman. If the electorate had intended
to
allow an anomalous meaning (such that either party is free to declare impasse regardless
of
whether it meets the traditional standard
of
a bargaining stalemate), it would have indicated
so
in clear language. 	There is nothing in the record to indicate that was the case. 	Local 39 does
not unequivocally reject this intended meaning,
as
it argues that under this definition,
the
parties in fact had not reached impasse. This also conforms to the reading given the
tenn
by
PERB in its recent decision. 	(City and County
of
San Francisco, supra, PERB Decision No.
1890-M, p. 9.)
That said, nothing in City & County
of
San Francisco, supra, PERB Decision
No. 1890-M, specifically prevents Local 39 from raising bad faith declaration
of
impasse
and/or lack
of
impasse in the traditional labor relations sense as a defense to the complaint
here. 	Though the evidentiary theories in the two cases parallel each other, a narrower
issue
is
presented here, and a factual record
of
the matters previously alleged by Local 39 has
been
fully developed after a fonnal hearing. 	(See State
of
California (Department
of
Industrial
Relations) (1998) PERB Decision No. 1299-S, pp. 8-14.) I am called upon to decide whether
such facts raise a valid defense to the City's charge ofrefusal to participate in the impasse
resolution procedures while giving full effect to the Board's rationale.
It is useful first to observe that parties in negotiations often disagree whether they have
34

arrived at a bargaining impasse. 	This is true both in the private sector and the public sector.
Under BERA, HEERA and the Dills Act, PERB plays a gatekeeper role in determining
whether impasse procedures may be invoked. This gatekeeper function is a substantial
deterrent to premature and arbitrary declarations
of
impasse. 	(See Regents
of
the University
of
California, supra, PERB Decision No. 520-H (hereafter Regents).) 	No such gatekeeper
function exists under the MMBA or the Charter.
In Regents, supra, PERB Decision No. 520-H, PERB addressed the issue whether a
premature declaration
of
impasse could constitute a per se failure to meet and confer in good
faith. 	PERB affirmed the administrative law judge's findings that under the objective standard
he applied the parties were at impasse and that the party that sought to proceed to the impasse
procedures was entitled to suspend further negotiations because it believed in good faith that
impasse existed. (Id. at pp. 14-18.) PERB agreed that the record in the case failed to
demonstrate that the union's declaration
of
impasse was made in bad faith. 	(Id.) 	PERB also
held that (a good faith) declaration
of
impasse, which is in fact unfounded, should not
be
deemed a per se unfair practice. (Id. at pp. 23-24.) Nonetheless, both parties at least in theory
are required to continue bargaining until a legitimate impasse occurs. (Id. at pp. 28-29, dis.
opn. Member Hesse.) Regents did not reject the theory that a bad faith declaration
of
impasse
could constitute a per se violation, though it was not required to reach that issue under
the
facts
presented. (Id. at pp. 14, 23-24.) City & County
of
San Francisco, supra, PERB Decision
No. 1890-M, follows Regents in finding that the assertion that one party is able to prematurely
declare impasse does not render the local rule at issue here unreasonable on its face. But it did
not address whether any remedy existed for a party that declared impasse prematurely, in bad
faith or otherwise.
35

In Regents, PERB noted and implicitly endorsed the administrative law
judge's
treatment
of
the premature declaration as evidence
of
bad faith in terms
of
the surface
bargaining allegation. 	(Regents, supra, PERB Decision No. 520-H, p. 14.)
	In
this context,
PERB concluded that a party must be privileged to claim impasse (rightly or wrongly) and will
not be found to have committed a per se violation
of
the duty to bargain as a result because
such a declaration at worst only momentarily suspends bargaining. (Id. at pp. 23-24; see also
Public Employees Assn.
v.
Board
of
Supervisors (1985) 167 Cal.App.3d 797, 807 [213
Cal.Rptr. 491] [invoking impasse is protected activity]; Campbell Municipal Employees Assn.
v.
City
of
Campbell (1982)
131
Cal.App.3d 416, 422 [182 Cal.Rptr. 461] [same as to impasse
resolution procedures].) That conclusion does arise in a setting where a neutral third-party
procedure overseeing the impasse detennination provides a forum for the party opposing the
impasse declaration.
Regents aside, Local 39 is conect in its point that good faith bargaining is a
precondition for the parties reaching a bona fide impasse. (City & County
of
San Francisco,
supra, PERB Decision No. 1890-M, p. 9;
see also Seattle First National Bank
v.
NLRB (9 th
Cir. 1983) 638 F.2d 1221, 1227 [106 LRRM 2621]; NLRB Pacific Wheel Grinding Co., Inc.
(9 th Cir. 1978) 572 F.2d 1343, 1349 [98 LRRM 2246]; NLRB
v.
Big Three Industries, Inc. (5 th
Cir. 1974) 497 F.2d 43, 48 [86 LRRM 3031 ].)20
Resolution
of
the issue here must take into consideration that no third-party
detennination exists under the City Charter or under the MMBA generally. 	There is no prompt
administrative procedure or "remedy" directing or compelling the resisting party to move into
the impasse resolution procedures. A party could seek to compel interest arbitration by filing a
Guidance from cases of under the NLRA, where applicable, is appropriate under the
MMBA. 	(Fire Fighters Union v. City of Valleio, supra, 12 Cal.3d at p. 616; McPherson v.
Public Employment Relations Bd. (1987) 189 Cal.App.3d 293, 306 [234 Cal.Rptr. 428].)
36

petition pursuant to the Code
of
Civil Procedure. This record does not indicate
why
the
City
failed in that attempt, although the defense
of
PERB
's
initial exclusive jurisdiction is
noted
in
PERB's
recent decision as at least one basis for that outcome. 	(City & County
of
San
Francisco, supra, PERB Decision No. 1890-M, pp. 3-4, fn. 4 [noting the matter is now pending
in the court
of
appeal]; Financial Institution Employees, Local 1182
v.
NLRB (9
th
Cir. 1984)
738 F.2d 1038, 1043 [117 LRRM 2139] [few issues in industrial relations better suited
to
the
expertise
of
the labor board than the determination
of
impasse]; see also Fire Fighters
Union
v.
City
of
Vallejo, supra,
12
Cal.3d at p. 611, fn. 1.) A party could also seek
PERB's
injunctive
relief, though the outcome
of
that process is problematic, and PERB denied the City's request
in this case as well. 	(But see Public Employment Relations Bd.
v.
Modesto City Schools
(1982) 136 Cal.App.3d 881 [186 Cal.Rptr. 634].)
Added to the prospect
oflengthy
delay at the expense
of
expediting the conclusion
of
negotiations is the fact that under the MMBA, as well as the other acts administered
by PERB,
there appears to be no precedent specifically preventing a party objecting to impasse
declaration (bad faith or otherwise) from raising what amounts to a technical refusal to proceed
to the impasse resolution procedures. 	Such a claim would have to be adjudicatedultimately in
the context
of
an unfair practice complaint like the one here.
On the other hand, the problem for the party protesting a premature impasse declaration
under the City Charter, as urged by Local 39 here, is that an unwaITanted declaration
prior
to
completion
of
face-to-face negotiations invokes procedures intended not merely to assist the
parties in reaching agreement but to conclude all issues in the negotiations through a decision
37

binding on the parties.2 1
With these competing interests in mind, I find by parity
of
reasoning that
if
a party is
privileged to claim impasse, the other party must be privileged to dispute that claim. This is
particularly true where it is claimed that the declaration was made in bad faith. 	Were it
otherwise, the offending party could skirt its legal obligation
to
bargain fully and in good faith.
And
if
the Charter must be read as only engaging the impasse resolution procedures after good
faith bargaining, compelling those procedures prematurely, in bad faith, would conflict with
the local rule itself. 	(City & County
of
San Francisco, supra, PERB Decision
No. 1890-M,
p.
9.)
The more debatable issue is whether a failure to reach impasse in the absence
of
a bad
faith claim should also be deemed a defense to refusal to participate in the impasse resolution
procedures. 	Given the absence
of
expedited procedures for neutral impasse determination, it
would be arbitrary to find that the party opposing the impasse declaration may not also raise
the technical defense when the impasse is only unfounded under an objective standard.
(Public Employment Relations Bd.
v.
Modesto City Schools, supra, 136 Cal.App.3d at
pp. 889-902 [refusal to bargain not predicated on bad faith showing, where impasse resolution
procedures have been exhausted but the parties disagree whether a factfinding report resulted
in changed circumstances that trigger resumption
of
the duty to negotiate]; Trustees
of the
California State University (1999) PERB Decision No. 1333-H [parties do not detennine
existence
of
impasse under the HEERA]; NLRB
v.
Andrew Jergens Co, Inc. (9
th
Cir. 1949)
170 F.2d 130 [24 LRRM 2096], cert. den. (1949) 338 U.S. 827 [24 LRRM 2561] [legitimate
21
Under the NLRA, once legitimate impasse is reached, either party may refuse to
negotiate further, the employer may implement its last, best and final offer, and the union may
resort to a strike. (See Dallas General Drivers v. NLRB (D.C. Cir. 1966) 355 F.2d 842
[61 LRRM 2065]; Fine Organics, Inc. (1974) 214 NLRB 158 (88 LRRM 1130].)
38

impasse is a defense to unilateral implementation of final offer terms]; Cuyamaca Meats Inc. v.
San Diego and Imperial Counties Butchers' and Food Employers' Pension Trust Fund (9th Cir.
1987) 827 F.2d 491, 496 [126 LRRM 2193] [same]; Dallas General Drivers v. NLRB, supra,
355 F.2d at pp. 844-845 [same].) In some cases, the rule has been stated that a party's good
faith is simply one factor in determining whether a true impasse has occurred. 	(See Regents,
supra, PERB Decision No. 520-H, p. 19; Taft Broadcasting Co. (1967) 163 NLRB 475,478
[64 LRRM 1386], rev. den. sub nom. American Federation of Television & Radio Artists v.
NLRB (D.C. Cir. 1968) 395 F.2d 622 [67 LRRM 3032].) Furthermore, the imposition on the
party seeking to declare impasse resulting from exhaustively exploring all proposals is
relatively minor, and such a rule will encourage the parties to self-police impasse
detennination in the absence of a third-party neutral. (See Walnut Creek Honda Associates 2,
Inc. v. NLRB (9 th Cir. 1996) 89 F.3d 645, 649 [152 LRRM 2847] [impasse is often a
"temporary deadlock or hiatus in negotiations"]; Public Employment Relations Bd. v. Modesto
City Schools, supra, 136 Cal.App.3d at p. 889 [same].)
I find that failure to reach a bona fide impasse under the circumstances of this case is a
defense to a party's alleged refusal to participate in the impasse resolution procedures.
B. 	The City's Impasse Declaration
Local 39 contends that if interest arbitration is mandatory the meaning of impasse in the
Charter must be the meaning ascribed to it by traditional labor law, but that the City's
interpretation of the tenn in this case belies that in practice. As explained above, I have found
that the traditional meaning of impasse is the meaning incorporated in the Charter. It should be
noted that PERB 's conclusion that impasse must be reached after good faith bargaining also
serves to confirm the reasonableness of the requirement of mandatory interest arbitration.
39

Local
39's
contends that the City's conduct at the table flouts the traditional meaning
of
impasse as demonstrated by the fact that the Isen declared impasse on April 7 without hearing
Local
39's
presentation
of
its proposal, despite Local
39's
repeated assurances that it
had
further movement to make, and in the face
of
unfulfilled information requests.
The City responds that impasse had been reached over the course
of
the
11
bargaining
sessions and after the exchange
of
more than 45 proposals and several package proposals. 	By
April 7 there were tentative agreements on sixteen proposals, eleven
of
which had been made
initially
by
Local 39. As
of
that session, the parties were still far apart on their major
wage
proposals, a difference
of
5.5 percent over three years. 	There had been no movement
on
the
three-year wage proposals by either side over the last two bargaining sessions.
PERB has defined impasse in the following terms: 	"[I]mpasse 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
Decision No. Ad-124, p. 5.) PERB's analysis has focused on a number
of
objective factors,
including the number and length
of
negotiating sessions, the extent to which the parties have
made and discussed counter-proposals to each other, the number
of
tentative agreements, and
the number
of
unresolved issues. (Cal. Code
of
Regs., tit. 8, sec. 32793(c); but see Regents,
supra, PERB Decision No. 520-H, p. 19 [good faith negotiating considered].)
Similarly under the NLRA, impasse has been defined as a "state
of
facts in which the
parties, despite the best
of
faith, are simply deadlocked." (Walnut Creek Honda Associates 2,
Inc. v. NLRB, supra, 89 F.3d at p. 649.) The National Labor Relations Board considers such
matters as the good faith
of
the parties, the number
of
meetings between the parties, the length
of those meetings, the period of time that has transpired between the stmi of negotiations and
40

their breaking off, the importance of the issues as to which there is disagreement, and the
contemporaneous understanding of the parties as to the state of negotiations. 	(Laborers Health
and Welfare Trust Fund v. Advanced Lightweight Concrete Co, Inc. (1987) 484 U.S. 539, 544
[127 LRRM 2657]; Taft Broadcasting Co., supra, 163 NLRB 475, 478.)
I find in this case that by the final bargaining session there was substantial
disagreement on the core economic issues, centered on the competing three-year wage
proposals. 	Allan asserted to Ginsburg and Callahan several months before negotiations had
formally commenced, that a wage increase was Local 39's primary objective in the bargaining.
She quantified the goal then, giving the City bargaining representatives an opportunity to
resolve that issue internally.
The record shows that the parties had considered each other's proposals and attempted
to narrow their disagreements. A substantial number of tentative agreements had been reached
by the final session. (Mt. San Antonio Community College District, supra, PERB Decision
No. Ad-124.) Although the record suggests that tentative agreements had yet to be reached on
a number of non-economic subjects, even Local 39 points to its potential movement on wages
as the key to further progress. 	Moreover, the parties were in the package-proposal mode of
bargaining at this time, and the City had rejected four such proposals from Local 39. The
concessions Local 39 were prepared to make on the multiple-license differential, parking
benefits, and out-of-class compensation are not quantified in the record and fail to establish
that they would have constituted movement on the economic issues sufficient to prompt further
concessions by the City. 	(See Regents, supra, PERB Decision No. 520-H, pp. 19-20 [impasse
reached based on significant differences on wages, which are not closing].)
I do acknowledge the evidence that Isen gave appearances of being dismissive toward
Local 39's bargaining team, but I am not convinced this demonstrates sufficient bad faith to
41

overcome the record of the parties' effo1is to naiTow their differences and the remaining
distance between their final economic proposals. After April 7, the City continued its efforts
to complete the information exchange and informed Local 39 that it would return to the table if
there were "movement on the core economic issues" by the union.
Although the parties were not in agreement on April 7 that they were at impasse (a
factor I accord lesser weight), the subsequent exchanges fail to demonstrate that the parties
were capable of moving toward closure of the outstanding issues without the assistance of a
mediator. 	Hence, the fact that Local 39 still had room to move on economic issues, that the
information request issues were not fully resolved, and that the City's bargaining team did not
appear fully engaged at times, fails to establish that impasse had not in fact been reached, or
that the City declared impasse in bad faith. 	(Regents, supra, PERB Decision No. 520-H, p. 17,
citing NLRB v. Tomco Communications (9 th Cir. 1978) 567 F.2d 871, 881 [97 LRRM 2660)
[wages and related benefits were economic issues looming so large as to cause stalemateJ;
American Federation of Television & Radio Artists v. NLRB, supra, 395 F.2d 622, 627, fn. 13
[same].)
I find that Local 39 was not excused from participating in the impasse resolution
procedures based on the City's conduct at the bargaining table or its alleged premature
declaration of impasse.
For all of the reasons set forth above, I find that Local 39 has violated section 3509(b)
and PERB Regulation 32604(d) by refusing to name a representative to an interest arbitration
panel and by refusing to participate in the Charter's impasse resolution procedures.
REMEDY
Pursuant to section 3509(a), the PERB under section 3541.3(i) is empowered to:
42

...
take any action and make any determinations in respect
of
these charges or alleged violations as the board deems necessary
to effectuate the policies
of
this chapter.
Local 39 has violated section 3509(b) and PERB Regulation 32604(d) by refusing to
name a representative to the interest arbitration panel and by refusing to participate in the
impasse resolution procedures set forth in the City Charter.
It
is appropriate
to
order Local 39
to cease and desist from its unlawful conduct. (Rio Hondo Community College District (1983)
PERB Decision No. 292, pp. 30-33; Mt. San Antonio Community College Dist.
v.
Public
Employment Relations Bd. (1989) 210 Cal.App.3d 178, 189 [258 Cal.Rptr. 302].)
It
is also the ordinary remedy in PERB cases that the party found to have committed an
unfair practice be ordered to post a notice incorporating the terms
of
the order. 	Such an order
ordinarily is granted to provide bargaining unit employees with a notice, signed by an
authorized agent that the offending party has acted unlawfully, is being required to cease and
desist from its unlawful activity, and will comply with the order. Thus, it is appropriate to
order Local 39 to post a notice incorporating the terms
of
the order herein at its offices,
employee organization bulletin boards, and all places where notices are customarily placed,
and additionally to distribute copies
of
the notice to all employees in the bargaining unit
through the City's internal distribution system
if
that is the customary method
of
distributing
union literature. Posting
of
such notice effectuates the purposes
of
the MMBA that employees
be informed
of
the resolution
of
this matter and Local 39's readiness to comply with the
ordered remedy.
PROPOSED ORDER
Upon the foregoing findings
of
fact and conclusions of law, and the entire record in this
case, it has been found that Stationary Engineers Local 39 (Local 39) violated the Meyers-
Milias-Brown Act (Act) by refusing to name a representative to an interest arbitration panel
43

and
by
refusing to participate in the impasse resolution procedures contained in the City
Charter
of
the City and County
of
San Francisco (City), in violation
of
Government Code
section 3509, subdivision (b), and PERB Regulation 32604(d) (Cal. Code
of
Regs, tit. 8, sec.
32604(d)).
Pursuant to section 3509, subdivision (a),
of
the Government Code, it hereby is
ORDERED that Local 39, and its representatives, shall:
A. 	CEASE AND DESIST FROM:
1.	
Refusing to name a representative to an interest arbitration panel.
2.	
Refusing to participate in the impasse resolution procedures contained
in
the City Charter.
B. 	TAKE THE FOLLOWING AFFIRMATIVE ACTIONS DESIGNED TO
EFFECTUATE THE POLICIES OF THE ACT:
1.	
Within ten (10) workdays
of
the service
of
a final decision in this matter,
post at its offices, employee organization bulletin boards, and all places where notices are
customarily placed, copies
of
the Notice attached hereto as an Appendix, and additionally to
distribute copies
of
the notice to all employees in the bargaining unit through the City's
internal distribution system
if
that is the customary method
of
distributing union literature.
The Notice must be signed by an authorized agent
of
Local 39, indicating that Local 39 will
comply with the tem1s
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.
2. 	Upon issuance
of
a final decision, make written notification
of
the
actions taken to comply with the Order to the Sacramento Regional Director of the Public
Employment Relations Board (PERB or Board) in accord with the director's instructions.
44

Pursuant to California Code of Regulations, title 8, section 32305, this Proposed
Decision and Order shall become final unless a party files a statement of exceptions with the
Board itself within 20 days of service of this Decision. The Board's address is:
Public Employment Relations Board
Attention: Appeals Assistant
1031 18th Street
Sacramento, CA 95814-4174
FAX: (916) 327-7960
In accordance with PERB regulations, the statement of exceptions should identify by
page citation or exhibit number the portions of the record, if any, relied upon for such
exceptions. 	(Cal. Code of Regs., tit. 8, sec. 32300.)
A document is considered "filed" when actually received before the close of business
(5 p.m.) on the last day set for filing. 	(Cal. Code of Regs., tit. 8, secs. 32 l 35(a) and 32130.) A
document is also considered "filed" when received by facsimile transmission before the close
of business on the last day for filing together with a Facsimile Transmission Cover Sheet
which meets the requirements of California Code of Regulations, title 8, section 32135( d),
provided the filing party also places the original, together with the required number of copies
and proof of service, in the U.S. mail. (Cal. Code of Regs., tit. 8, sec. 32135(b), (c) and (d);
see also Cal. Code of Regs., tit. 8, secs. 32090 and 32130.)
Any statement of exceptions and supporting brief must be served concurrently with its
filing upon each party to this proceeding. 	Proof of service shall accompany each copy served
on a party or filed with the Board itself. (See Cal. Code of Regs., tit. 8, secs. 32300, 32305,
32140, and 32135(c).)
45
Donn Gin6zT O 	"
Administrative Law Judge