El Centro Regional Medical Center (PERB 2890M)

STATE OF CALIFORNIA
DECISION OF THE
PUBLIC EMPLOYMENT RELATIONS BOARD
TEAMSTERS LOCAL 542,
Charging Party,
v.
EL CENTRO REGIONAL MEDICAL CENTER,
Respondent.
Case No. LA-CE-1566-M
PERB Decision No. 2890-M
February 21, 2024
Appearances: Smith Steiner Vanderpool by Fern M. Steiner, Attorney, for Teamsters
Local 542; Sheppard Mullin Richter & Hampton by John S. Bolesta and Jason W.
Kearnaghan, Attorneys, for El Centro Regional Medical Center.
Before Banks, Chair; Krantz and Paulson, Members.
DECISION
BANKS, Chair: This case is before the Public Employment Relations Board
(PERB or Board) on exceptions by Respondent El Centro Regional Medical Center
(ECRMC) to a proposed decision of an administrative law judge (ALJ). The dispute
concerns Certified Phlebotomist Technicians (CPTs) and other Technician
classifications working in ECRMC’s Laboratory (Laboratory Unit), who are represented
by Charging Party Teamsters Local 542 (Teamsters). At issue is the Laboratory Unit’s
eligibility for a two percent merit salary increase.1
1 The ALJ also determined that the employer did not engage in direct dealing
during a February 16, 2022 staff meeting with represented employees. As neither
party filed exceptions to the ALJ’s determination, the Board will not address that issue,
and we leave that matter in the proposed decision undisturbed.

2
Until 2020, the Laboratory employees working in classifications eventually
covered by the Laboratory Unit were unrepresented. In September of that year,
Teamsters petitioned to represent the Laboratory Unit, and ECRMC recognized
Teamsters as the exclusive representative. In 2021, the parties began negotiating an
initial Memorandum of Understanding (MOU) for the new unit.
Dating back to 2016, ECRMC had a consistent practice of reviewing financial
resources and the prevailing job market and then establishing the level of its
across-the-board merit increase program for unrepresented employees in the next
fiscal year. This practice predated, by more than four full years, Laboratory
employees’ September 2020 decision to become represented.
In July 2021, ECRMC announced a two percent across-the-board merit wage
increase for all unrepresented employees who commenced employment prior to
January 1, 2021. Per the announcement, “[a]ny pay rate increase for our bargaining
unit employees shall be governed by the applicable [MOU] and/or discussed during
current negotiations.” ECRMC unilaterally announced to Teamsters that the
Laboratory Unit was not eligible, and ECRMC never provided Laboratory Unit
employees with the July 2021 two percent increase, nor offered that increase to
Teamsters in bargaining for the Laboratory Unit.
MOU negotiations concluded in July 2022. The resulting MOU, effective
July 27, 2022, through July 26, 2025, provides for annual salary increases, with the
first increase on the effective date of the MOU. The July 2021 two percent merit
increase was not addressed in the MOU.

3
The complaint in this matter alleges that, by excluding the Laboratory Unit from
the two percent across-the-board merit increase program without bargaining to
impasse or agreement, ECRMC unilaterally changed the status quo and discriminated
against employees for protected activity in violation of the MMBA.2 The complaint
further alleges that, by not providing the July 2021 wage increase, ECRMC interfered
with the rights of bargaining unit employees to be represented by Teamsters.3
The ALJ found in the union’s favor as to the unilateral change, discrimination,
and interference claims related to ECRMC’s failure to pay the July 2021 wage
increase; ECRMC seeks reversal on all counts and dismissal of the complaint.
Having considered the matter de novo, and upon review of the entire record, we
find that, by failing to pay the Laboratory Unit employees the July 2021 wage increase,
ECRMC unlawfully committed a unilateral change and engaged in unlawful
discrimination and interference.
FACTUAL AND PROCEDURAL BACKGROUND
ECRMC is a public agency within the meaning of MMBA section 3501,
subdivision (c), and PERB Regulation 32016, subdivision (a), and Teamsters is a
recognized employee organization within the meaning of MMBA section 3501,
2 The MMBA is codified at Government Code section 3500 et seq. All further
undesignated statutory references are to the Government Code. PERB Regulations
are codified at California Code of Regulations, title 8, section 31001 et seq.
3 Prior to the formal hearing in this matter, Teamsters requested that its surface
bargaining allegation against ECRMC be withdrawn with prejudice from the unfair
practice charge and dismissed from the complaint. PERB’s Office of the General
Counsel (OGC) subsequently confirmed the withdrawal.

4
subdivision (b), and an exclusive representative under PERB Regulation 32016,
subdivision (b).
Teamsters represents several bargaining units at ECRMC.4 In September 2020,
Teamsters petitioned to establish and represent two new bargaining units at ECRMC
pursuant to ECRMC’s local representation rules. The first unit consisted of CPTs and
other Technician classifications working in ECRMC’s Laboratory. The second unit
consisted of various dietary classifications (Dietary Unit). The disputes in this case
involve only the Laboratory Unit. ECRMC recognized Teamsters as the exclusive
representative of both units later that month. The parties began bargaining over initial
MOUs for each unit in 2021.
I. 	Wage Increases at ECRMC
Before 2016, ECRMC employed a “pay for performance process” whereby
employees received salary increases between zero and three percent based on
receiving positive ratings in their annual performance evaluations. ECRMC changed
that model in 2016 because, according to Chief Operating Officer Luis Castro, it
became “too tedious to do individual increases,” so ECRMC instead moved to “an
overall, hospital wide” approach.
For unrepresented employees, every year since 2016, ECRMC has reviewed
financial resources and the prevailing job market and then established the level of its
4 Starting in or around 2013, Teamsters became the exclusive representative of
a Nurses Unit consisting of Registered Nurses and Licensed Vocational Nurses at
ECRMC. Starting in 2019, Teamsters became the exclusive representative of a
Technical Unit consisting of various Technician classifications at ECRMC, including
Certified Nursing Assistants, Medical Assistants, Respiratory Care Technicians, and
Imaging and Ultrasound Technologists.

5
across-the-board merit increase program for the upcoming fiscal year. 	In most if not
all of those years, the amount has been two percent, though the record does not show
the exact amount of the increases paid in 2017 and 2018.
5
For represented employees, the parties agree that MOU provisions control
wage adjustments once the parties agree to an MOU, but they dispute what should
occur pending negotiation of a bargaining unit’s first MOU after it becomes
represented. This question first arose with respect to a different unit in 2019.
Specifically, Teamsters became the exclusive representative of the Technical Unit in
the first quarter of 2019, and thereafter the 2019-2020 wage adjustment cycle started on
July 1, 2019, while the parties were negotiating their first MOU. ECRMC unilaterally
declared that the Technical Unit would not participate in that year’s two percent
across-the-board merit program, leading Teamsters to file an unfair practice charge that
PERB designated as Case No. LA-CE-1403-M. Castro’s testimony and ECRMC’s
exceptions both admit that ECRMC ultimately agreed, as part of an eventual MOU, that
ECRMC would retroactively provide the two percent increase. At that point, Teamsters
withdrew Case No. LA-CE-1403-M.
II. 	The Laboratory Unit and the July 2021 Merit Increase
After ECRMC recognized Teamsters as the exclusive representative of the
Laboratory Unit on September 18, 2020, events initially unfolded much as they had for
the Technical Unit, before ultimately breaking with that past example. Teamsters
began bargaining with ECRMC for the Laboratory Unit in 2021. At the outset of
5 ECRMC utilizes a fiscal year, which runs from July 1 to June 30 of the
following year.

6
bargaining, Flavio Grijalva, Business Representative for Teamsters, informed ECRMC
that the “status quo” would be that employees in the two new bargaining units would
receive “any increases given to any other personnel in the hospital[.]” At the time,
ECRMC had not announced an increase, and Grijalva was unaware of any planned
increases.
On July 7, 2021, ECRMC issued a memorandum stating that unrepresented
employees would receive a two percent merit increase retroactive to July 1, 2021.
According to the announcement, “[a]ny pay rate increase for our bargaining unit
employees shall be governed by the applicable [MOU] and/or discussed during current
negotiations.” The Laboratory Unit did not receive the two percent merit increase in
July 2021. After the July 7, 2021 memorandum issued, Grijalva had a telephone
discussion with Castro during which Grijalva stated that he expected the status quo to
be maintained and that the Laboratory employees would receive the merit increase
given the other employees. Castro had a different view, which was that Laboratory
employee wages must remain frozen until an MOU took effect. The ALJ asked Castro
how ECRMC responded when Teamsters demanded the 2021 increase, and Castro
admitted he could not recall what counteroffer ECRMC made. The parties never
reached any agreement for an increase for the 2021-2022 fiscal year, and Laboratory
employees accordingly never received any increase in that year or retroactive to that
year.
The parties’ 2022-2025 MOU neither addresses this charge nor compensation
for fiscal year 2021-2022. Article 19 of the MOU states:
“ECRMC and the Union acknowledge that during the
negotiations which resulted in this MOU, each Party had

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the unlimited right and opportunity to make proposals with
respect to any subject or matter not removed by law from
the area of the negotiations process. Therefore, ECRMC
and the Union for the term of this MOU, each voluntarily
and qualifiedly waive the right, and each agree that the
other shall not be obligated to negotiate collectively with
respect to any subject or matter whether or not referred to
in this MOU, except as otherwise provided herein.”
Article 25, Section 9, provides for salary increases each year of the MOU’s term,
beginning with fiscal year 2022-2023. The first increase began on the effective date of
the MOU, July 27, 2022.
Teamsters filed the instant charge on February 28, 2022. OGC issued a
complaint on August 9, 2022. ECRMC filed its answer on August 26, 2022. The ALJ
convened a formal hearing on January 10, 2023, and the parties filed closing briefs on
April 25, 2023. On June 27, 2023, the ALJ issued a proposed decision that found in
the union’s favor as to the unilateral change, discrimination, and interference claims
related to ECRMC’s failure to pay the July 2021 wage increase to the Laboratory Unit.
DISCUSSION
When resolving exceptions to a proposed decision, the Board applies a de novo
standard of review. (City of San Ramon (2018) PERB Decision No. 2571-M, p. 5.)
However, the Board need not address alleged errors that would not affect the
outcome. (Ibid.) Here, Part I addresses the complaint’s unilateral change claim, Part II
addresses the discrimination and interference claims, Part III addresses ECRMC’s
affirmative defenses, and Part IV addresses remedies.
As a threshold matter, ECRMC’s exceptions fail to mention even a single time,
much less discuss, the critical unilateral change and discrimination authority on which

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the ALJ relied. With respect to the unilateral change claim, there is a single dispositive
issue: whether ECRMC had a sufficiently established annual wage adjustment
process. The ALJ carefully analyzed that issue over seven pages, with dozens of legal
citations to sixteen different decisions. Nine of these decisions were precedential
authority—eight PERB decisions and one decision of the California Court of Appeal—
yet ECRMC’s exceptions did not cite or discuss any of them even a single time. Seven
more decisions the ALJ cited come from private sector precedent that is persuasive
authority, and ECRMC’s exceptions cited only one of these seven decisions.6
Similarly, with respect to discrimination, the ALJ carefully analyzed precedent on
facially discriminatory actions such as failing to offer or provide a pay increase to an
employee group for the sole reason that they recently chose to become represented
by a union. Over the course of three pages, the ALJ cited five precedential
decisions—four PERB decisions and a Court of Appeal decision—but ECRMC’s
6 Although California public sector labor relations precedent frequently protects
employee and union rights to a greater degree than does federal precedent governing
private sector labor relations, PERB considers federal precedent for its potential
persuasive value. (Operating Engineers Local Union No. 3 (Wagner et al.) (2021)
PERB Decision No. 2782-M, p. 9, fn. 10; City of Santa Monica (2020) PERB Decision
No. 2635a-M, p. 47, fn. 16; City of Commerce (2018) PERB Decision No, 2602-M,
pp. 9-11; see also Social Workers’ Union, Local 535 v. Alameda County Welfare Dept.
(1974) 11 Cal.3d 382, 391 [when interpreting California public sector labor relations
laws, federal precedent is a “useful starting point,” but it does “not necessarily
establish the limits of California public employees’ representational rights”]; County of
San Joaquin (2021) PERB Decision No. 2761-M, pp. 24, 33, 45-48 & fn. 19
[considering private sector labor law precedent for its persuasive value while noting
certain differences in California public sector labor law precedent]; City of Bellflower
(2020) PERB Order No. Ad-480-M, p. 11 [both “statutory differences and distinct
principles relevant to agencies serving the public have frequently led the Board to craft
sui generis precedent”].)

9
exceptions fail to mention or address any of them even once. The ALJ also cited one
private sector decision that is persuasive authority, and ECRMC’s exceptions also do
not cite or address it. We thus uphold the ALJ’s analysis on defining the status quo
and discrimination, first, because ECRMC has not addressed precedent cited in the
proposed decision, thereby failing to preserve its arguments on these points.
However, to provide guidance to the labor management community for future cases,
we exercise our discretion to summarize the ALJ’s correct analysis on these issues,
as supplemented by one Board decision that postdates the proposed decision.
I. 	Unilateral Change Analysis
To establish a prima facie case that a respondent employer made an unlawful
unilateral change, a charging party union that exclusively represents a bargaining unit
must prove: (1) the employer changed or deviated from the status quo; (2) the change
or deviation concerned a matter within the scope of representation; (3) the change or
deviation had a generalized effect or continuing impact on represented employees’
terms or conditions of employment; and (4) the employer reached its decision without
first providing adequate advance notice of the proposed change to the union and
bargaining in good faith over the decision, at the union’s request, until the parties
reached an agreement or a lawful impasse. (Bellflower Unified School District (2021)
PERB Decision No. 2796, p. 9.) Here, only the first prong is in dispute, and the
outcome of the unilateral change claim hinges on correctly defining ECRMC’s duty to
maintain the status quo during MOU negotiations.
ECRMC claims that it would have been an unlawful change in the status quo to
include Laboratory employees in the July 2021 two percent merit increase program.

10
However, it is categorically not an unlawful unilateral change to do exactly as the
exclusive representative indicates is desired, expected, and legally required. Moreover,
ECRMC ignores that the past practices that comprise the status quo are sometimes
dynamic and “must take into account the regular and consistent past patterns of
changes.” (Pajaro Valley Unified School District (1978) PERB Decision No. 51, p. 6.)
Thus, “in some circumstances it will be an unfair labor practice to grant unilaterally a
wage increase, but in other cases, where the status quo involves an existing wage
structure calling for annual increases, it is unlawful to unilaterally deny a wage
increase.” (County of Kern (2018) PERB Decision No. 2615-M, p. 7, fn. 8 [citations
and internal quotation marks omitted].)
For a newly recognized unit such as the Laboratory Unit, there is no prior
contract that defines the status quo, meaning the status quo pending negotiations “is
measured by employees’ previous expectation” from the time that they were
unrepresented, unless the parties agree otherwise. (Regents of the University of
California (2023) PERB Decision No. 2884-H, p. 14, citing Daily News of Los Angeles
v. NLRB (D.C. Cir. 1996) 73 F.3d 406, 411-414 (Daily News); Liberty Telephone &
Communication, Inc. (1973) 204 NLRB 317, 318.) Employees may have an
established expectation of having their wages adjusted each cycle, which must be
honored pending negotiations even if they cannot know the exact wage adjustments
that they are likely to receive in any given year. (Regents of the University of
California, supra, PERB Decision No. 2884-H, p. 15, fn. 13.)
While failing to address most precedent upon which the ALJ relied, ECRMC rests
its position primarily on a single decision, Arc Bridges, Inc. v. NLRB (D.C. Cir. 2011)

11
662 F.3d 1235 (Arc Bridges). Even had ECRMC addressed the full range of precedent
the ALJ cited, Arc Bridges would not overcome such precedent. Indeed, in Arc Bridges,
the appellate court noted that the employer had granted no increases whatsoever in
“three of the five years immediately preceding” the alleged unilateral change. (Id. at
p. 1239.) This means that, unlike in this case, it was simply not reasonable for
employees to have a prior expectation of an annual wage increase.7 (See, e.g.,
Pittsburg Unified School District (2022) PERB Decision No. 2833, p. 12 [for issue that
arises annually, it was appropriate to look back at the prior four years to determine if
employees had a sufficient reasonable expectation to support an unwritten past
practice].)
Here, there is no dispute that ECRMC established its current merit salary
increase practice in 2016 and that Laboratory employees, including those who would
eventually be part of the Laboratory Unit, had received annual merit increases each
year from 2016 until 2021. There is no indication of significant variation in the practice
from year to year, even when a worldwide pandemic arose in 2020. In these
circumstances, the practice was regular and consistent enough for employees to have
a reasonable expectation that the status quo would continue, meaning ECRMC had a
duty to maintain that status quo unless and until it bargained to impasse or to
7 A longer look-back was similarly of no aid to the union in arguing for a
reasonable employee expectation of an annual increase in Arc Bridges, supra, 662
F.3d 1235, as the employer had granted an annual across-the-board increase in only
six of the prior fifteen years. (Id. at p. 1239.)

12
agreement with Teamsters. ECRMC therefore violated the MMBA when it changed the
status quo for Laboratory Unit employees without bargaining.8
II. 	Discrimination and Interference Analysis
A. 	Discrimination
Under MMBA section 3506, it is unlawful to interfere with or discriminate
against employees because they have exercised rights under section 3502. (See also
MMBA § 3506.5, subd. (a).) The complaint in this matter alleges that refusing to
provide the 2021 merit increase to Laboratory Unit employees constitutes unlawful
discrimination and interference.
To prove discrimination, a charging party must prove by a preponderance of the
evidence that the respondent acted with an improper motive, intent, or purpose.
(Contra Costa Fire Protection District (2019) PERB Decision No. 2632-M. p. 40
(Contra Costa).) A charging party may do so using either of two frameworks. First,
under the framework set forth in Novato Unified School District (1982) PERB Decision
No. 210 and its progeny, the charging party’s prima facie case requires each of four
elements: (1) one or more employees engaged in activity protected by a labor
8 ECRMC notes that it also excluded the Dietary Unit from its July 2021 merit
increase program, yet Teamsters filed no charge for that unit. This provides no
defense. Prior to 2021, the only time the issue had arisen was with respect to the
Technician Unit in 2019, and Teamsters had filed a charge. Even had Teamsters not
done so in 2019, acceding to a change in one case does not accede to further
changes of the same type. (County of Kern & Kern County Hospital Authority (2019)
PERB Decision No. 2659-M, p. 22, fn. 19.) Along the same lines, merely because the
Laboratory and Dietary Units experienced the same unilateral change at the same
time, nothing required Teamsters to include both units in its charge. We therefore
affirm the ALJ’s determination that Teamsters’ decision not to litigate a charge for the
Dietary Unit has no bearing on this case.

13
relations statute that PERB enforces; (2) the respondent had knowledge of such
protected activity; (3) the respondent took adverse action against one or more
employees; and (4) the respondent took the adverse action “because of” the protected
activity, which PERB interprets to mean that the protected activity was a substantial or
motivating cause of the adverse action. (City and County of San Francisco (2020)
PERB Decision No. 2712-M, p. 15.) If the charging party establishes a prima facie
case but the evidence also reveals a non-discriminatory reason for the employer’s
decision, the respondent may prove, by a preponderance of the evidence as an
affirmative defense, that it would have taken the exact same action even absent
protected activity. (Ibid.) In such “mixed motive” or “dual motive” cases, the question
becomes whether the adverse action would not have occurred “but for” the protected
activity. (Id. at p. 16.)
Alternatively, if conduct facially discriminates based on protected activity, that is
“discrimination in its simplest form,” and PERB may infer unlawful discrimination
without further evidence of motive. (County of San Joaquin, supra, PERB Decision
No. 2761-M, p. 27; Los Angeles County Superior Court (2018) PERB Decision
No. 2566-C, p. 14 (LA Superior Court).) Common examples of facial discrimination
include: (1) providing different pay, benefits, or other working conditions based
explicitly on union membership or other protected activity; and (2) changing policies in
response to protected activity. (City of Yuba City (2018) PERB Decision No. 2603-M,
pp. 10-11 (Yuba City).) The conduct at issue may, but need not, involve disparate
conduct toward different employee groups. (Regents of the University of California

14
(Berkeley) (2018) PERB Decision No. 2610-H, p. 81; LA Superior Court, supra, PERB
Decision No. 2566-C, p. 15.)
If an employer extends a benefit or increase to an unrepresented employee
group while withholding it from a represented employee group (or vice versa), that can
establish discrimination under either or both above standards, unless the difference is
legitimately based on a non-discriminatory business reason. (Contra Costa, supra,
PERB Decision No. 2632-M, pp. 41-42.) The employer has the burden to prove that
the difference is based on a non-discriminatory reason. (Id. at pp. 38-42 & 51-52;
Yuba City, supra, PERB Decision No. 2603-M, pp. 11-13; LA Superior Court, supra,
PERB Decision No. 2566-C, pp. 15-17.)
ECRMC management admitted that the sole reason the Laboratory Unit did not
receive the two percent wage increase was because Teamsters became the
Laboratory Unit employees’ exclusive representative. Accordingly, in this case the
conduct at issue is facially discriminatory. (Contra Costa, supra, PERB Decision
No. 2632-M, pp. 40-54.) ECRMC claims that its “decision to withhold the increase in
2021 from the Laboratory unit employees was driven exclusively by its concerns in
preserving the status quo.” This argument is pretextual, however, and in fact
establishes an unlawful motive. Had ECRMC in fact merely been concerned that
granting the wage increase might be an unfair labor practice, it could have proposed
the increase in bargaining. ECRMC knew, of course, that Teamsters would accept the
increase, given that Teamsters had consistently demanded from the outset that
Laboratory Unit employees receive the July 2021 two percent merit increase.

15
ECRMC’s exclusive reliance on an alleged legal prohibition was thus pretextual,
further demonstrating its unlawful motive.
While ECRMC has stated that its decision to withhold the increase from
Laboratory Unit employees was “driven exclusively” by its alleged concerns with
preserving the status quo, it has also made a post-hoc, conclusory argument that its
offers in bargaining for fiscal years 2022-2023, 2023-2024, and 2024-2025 were
sufficiently large that they make up for its decision to offer no wage increase in
2021-2022 based on the Laboratory Unit deciding to unionize that year. An employer
making such an argument has the burden of introducing persuasive supporting
evidence. (Contra Costa, supra, PERB Decision No. 2632-M, p. 14 & p. 15, fn. 10
[after employer declined to offer a benefit to an employee group because the group
became represented, employer failed to show calculations supporting its post-hoc
argument that it offered the group other compensation of equal or greater value].)
Here, however, ECRMC did not show that its offers for fiscal years 2022-2023,
2023-2024, and 2024-2025 compensated for the 2021-2022 discriminatory action.
Indeed, Castro was unable to provide such evidence when asked. As noted above, the
ALJ asked Castro how ECRMC responded when Teamsters demanded the 2021
increase, and he admitted he could not recall what counteroffer ECRMC made. Then,
ECRMC counsel unsuccessfully tried to rehabilitate Castro’s testimony by asking him
whether the eventual Laboratory Unit MOU took into account the 2021 increase the
unit had missed. Castro, however, answered only that his “impression was yes.” Such
answers do not satisfy ECRMC’s burden.9
9 An employer claiming that greater increases in later years make up for a

16
decision not to provide one in an earlier year has an added burden in explaining a
nondiscriminatory business reason for providing benefits later than it would have
otherwise, and to a somewhat different group of employees due to normal staff
turnover. As a result, such evidence may impact the proper remedy without providing
a defense to liability. As discussed post, in this case the ALJ took the later wage
increases into account in his decision to direct ECRMC to pay the two percent
increase for only a single year rather than on an ongoing basis, and we express no
opinion on that limitation given that Teamsters has filed no exception to it. Thus, while
the ALJ did not accept ECRMC’s argument as a defense against liability, the ALJ
partially agreed with ECRMC in finding that payment of a single year’s wages would
effectuate the MMBA’s purposes.
B. 	Interference
While both our unilateral change and discrimination findings create derivative
interference liability, even were we to consider interference as an independent claim
as it is alleged in the complaint, we would still find a violation. To establish a prima
facie interference case, a charging party must show that an employer’s conduct tends
to or does result in some harm to protected union and/or employee rights. (City of San
Diego (2020) PERB Decision No. 2747-M, p. 36 (San Diego).) A charging party need
not establish that the employer acted because of an unlawful motive. (Claremont
Unified School District (2019) PERB Decision No. 2654, p. 20.)
If a charging party establishes a prima facie case, the burden shifts to the
employer. (San Diego, supra, PERB Decision No. 2747-M, p. 36.) The degree of harm
dictates the employer’s burden. (Ibid.) If the harm is “inherently destructive” of
protected rights, the employer must show that the interference results from
circumstances beyond its control and that no alternative course of action was
available. (Ibid.) For conduct that is not inherently destructive, the respondent may
attempt to justify its actions based on operational necessity. (Ibid.) In such cases,

17
PERB balances the asserted business need against the tendency to harm protected
rights; if the tendency to harm outweighs the necessity, PERB finds a violation. (Ibid.)
Within the category of actions or rules that are not inherently destructive, the stronger
the tendency to harm, the greater is the respondent’s burden to show its business
need was important and that it narrowly tailored its actions or rules to attain that
purpose while limiting harm to protected rights as much as possible. (Id. at pp. 36-37,
fn. 19.)
Here, the harm is well established. Not only did Laboratory Unit employees
miss out on an entire year’s pay increase, but ECRMC’s action tends to chill future
protected activity by sending the message that it will not honor its traditional pay
practices while bargaining an initial MOU. ECRMC’s claim that it was driven by alleged
concerns with preserving the status quo does not constitute a legitimate and
substantial business justification for failing to pay the Laboratory Unit employees the
July 2021 two percent wage increase. ECRMC’s admission to the harmful conduct –
the failure to pay the July 2021 increase – therefore easily outweighs ECRMC’s
justification. This conduct interfered with Teamsters’ right to represent its members,
which is unlawful under MMBA section 3506.5, subdivision (b) and PERB Regulation
32603, subdivision (b). (County of Orange (2018) PERB Decision No. 2611-M, p. 21.)
III. 	Affirmative Defense Analysis
At different points in these proceedings, ECRMC asserted the six-month statute
of limitations, laches, and waiver as affirmative defenses. However, we agree with the
ALJ that ECRMC failed to establish any of these defenses.

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ECRMC does not challenge the ALJ’s rejection of the statute of limitations
defense and for that reason we leave undisturbed the ALJ’s determination that
because ECRMC did not properly raise this affirmative defense, the merits of this
defense will not be considered.
ECRMC does, however, argue in its closing brief that it “timely [pled] an
affirmative defense regarding the Union’s failure to timely file the Charge” because it
asserted the affirmative defense of laches in its answer. ECRMC raises the laches
and waiver defenses again in its exceptions. However, we agree with the ALJ and find
ECRMC’s position to be without merit.
To establish laches, a respondent must show that: (1) the charging party
unreasonably delayed in prosecuting its case, and (2) either the charging party
acquiesced in the acts about which it complains, or the respondent suffered prejudice
from the charging party’s unreasonable delay. (Santa Ana Unified School District
(2017) PERB Decision No. 2514, p. 22.) ECRMC fails to establish support for either of
these elements, and so the affirmative defense of laches is unfounded.
ECRMC has also filed exceptions arguing that Teamsters waived its right to
bargain over the 2021 merit increase because the terms of the 2022-2025 MOU
included separate (and higher percentage) wage increases. However, as discussed
above, Teamsters met its burden of proving that ECRMC’s decision to deny the 2021
merit increase to employees in the Laboratory Unit constituted a unilateral change
without bargaining in good faith to impasse or agreement. As the ALJ found, waiver by
agreement must be clear and unmistakable, and the agreement here does not come
close to that standard, since it does not mention this charge, or the missed wage

19
increase in fiscal year 2021-2022. We similarly affirm the ALJ’s conclusions that:
(1) Article 19 of the MOU could not possibly authorize ECRMC to unilaterally change
wages in 2021, and (2) Teamsters could not have committed a waiver by failing to
demand bargaining. Rather, Teamsters had no obligation to demand bargaining after
ECRMC already made a firm decision to unilaterally change the status quo for
Laboratory Unit employees. (County of Santa Clara (2013) PERB Decision
No. 2321-M, p. 24, citing State of California (Department of Personnel Administration)
(1999) PERB Decision No. 1313-S, pp. 6-7.) This is because “good faith bargaining is
not possible when [the] employer has already ‘imposed the very terms under
discussion, thereby forcing the union to start from a position of having to talk the
employer back to the status quo.’” (County of Merced (2020) PERB Decision
No. 2740-M, pp. 22-23, quoting City of San Ramon, supra, PERB Decision
No. 2571-M, p. 6.)
For these reasons, ECRMC has not established any affirmative defenses for its
conduct.
IV. 	Remedies
We affirm the proposed remedies ordered by the ALJ, with one modification. In
the proposed decision, the ALJ ordered, inter alia, that ECRMC compensate with
backpay all current and former Laboratory Unit employees who had commenced
employment before January 1, 2021, for an amount equal to two percent of any wages
earned between July 4, 2021 and July 26, 2022, augmented by interest at a rate of
seven percent per annum.10 Based on the following analysis, we have determined that
10 In the absence of any exceptions from the Teamsters, we express no opinion

20
compound daily interest, rather than the rate of simple interest at seven percent per
annum, is appropriate in this case and all future cases where interest is awarded.11
on whether Teamsters had a colorable argument that the two percent wage increase
should continue indefinitely unless and until lawfully changed by agreement or
following an impasse, as in Contra Costa, supra, PERB Decision No. 2632-M. We do
affirm, however, the ALJ’s correct analysis that while it is impossible to know what the
parties would have bargained for 2022-2025 wages if ECRMC had complied with the
law in 2021, we construe such uncertainty against the wrongdoer that created it,
provided it is possible to estimate losses. (City of Pasadena (2014) PERB Order
No. Ad-406-M, p. 27.)
The MMBA grants PERB broad discretion to order remedies necessary to
effectuate the policies and purposes of the Act. (County of Lassen (2018) PERB
Decision No. 2612-M, p. 7.) “Back pay, front pay and/or other monetary awards, plus
interest, are an ordinary part of Board-ordered remedies where necessary to
compensate injured parties or affected employees for out-of-pocket losses caused, in
whole or in part, by an unfair practice.” (Sonoma County Superior Court (2017) PERB
Decision No. 2532-C, p. 42 [conc. & dis. opn. of Banks, M., citing Fairfield-Suisun
Unified School District (2012) PERB Decision No. 2262 (Fairfield-Suisun), pp. 18-19;
Los Angeles Unified School District (2001) PERB Decision No. 1469, pp. 5-6, 11; San
Ysidro School District (1997) PERB Decision No. 1198, p. 5; Fresno County Office of
Education (1996) PERB Decision No. 1171, pp. 7-8, and proposed decision at
pp. 1-2].) It is well established that PERB awards interest on monetary damages
ordered as part of a make whole remedy. (State of California (Correctional Health
11 We have discretion to reverse a proposed decision or administrative
determination even on issues as to which neither party appealed, and we exercise that
discretion with respect to interest calculation methods. (Oakland Unified School
District (2023) PERB Decision No. 2875, p. 9.)

21
Care Services) (2021) PERB Decision No. 2760-S, pp. 48-49, fn. 31.) Moreover,
remedial awards should make injured parties whole and deter future interference and
discrimination. (County of San Joaquin v. PERB (2022) 82 Cal.App.5th 1053, 1068.)
Past PERB decisions note, relying on judicial precedent, that administrative
agencies like PERB are not bound by the seven percent simple interest rate specified
in article XV, section 1 of the California Constitution. (San Ysidro School District,
supra, PERB Decision No. 1198, p. 5; Regents of the University of California (1997)
PERB Decision No. 1188-H, pp. 33-35.) PERB has typically awarded simple interest at
seven percent per annum, but in two recent cases the Board has indicated it may shift
to daily compound interest.
First, in Bellflower Unified School District (2022) PERB Decision No. 2544a
(Bellflower), the Board addressed a variety of remedial issues on appeal from a
compliance decision. Among the issues on appeal were the interest owed to several
employees who had been unlawfully laid off. (Id. at pp. 41-44.) In considering the
interest owed, the Board noted that the National Labor Relations Board (NLRB)
adopted compound interest in 2010. (Id. at p. 41, fn. 23, citing Kentucky River Medical
Center (2010) 356 NLRB 6 (Kentucky River).) The Board did not consider the issue in
Bellflower because, during litigation, the parties in that matter stipulated to simple
interest. (Bellflower, supra, PERB Decision No. 2544a, p. 41, fn. 23.) In a decision that
followed Bellflower, the Board again flagged the issue while saving it for a future case
because the parties reached an agreement mooting their dispute. (Tahoe-Truckee
Sanitation Agency (2022) PERB Decision Number 2826-M, pp. 2-4.)

22
Bellflower, supra, PERB Decision No. 2544a specifically contemplates PERB’s
eventual adoption of the compound interest standard. To that end, Bellflower adopted
a comprehensive set of instructions for interest calculations which include directions
for compound interest.12 For instance, Bellflower explained the use of an interest
calculator and typical interest accrual (id. at pp. 41-43) and instructed that if
calculating compound interest, one must input the compounding frequency into an
interest calculator. (Id. at p. 42, fn. 25.)
It should come as no surprise, then, that today the Board adopts a policy which
directs that interest on backpay and other monetary make-whole remedies is to be
compounded daily. It is evident that remedial delay harms employees, but the policy
we announce today, directing the augmentation of monetary awards by daily
compounding interest, will reduce that harm by more accurately compensating
employees for that inherent delay. When an employer wrongfully withholds wages –
whether, for example, due to retaliatory discharge or failure to increase wages as
required by the status quo – employees suffer actual consequences. Employees often
face financial hardship as a direct result of an employer’s misconduct, such as falling
into debt to meet daily expenses, drawing down savings or retirement funds (and
having to pay penalties to access those funds), or even missing mortgage or rent
12 Bellflower includes one error which we now correct: in its discussion of interest,
that decision noted that “the ending accrual date is normally the date on which an
employee resumes work after accepting a reinstatement offer or declines
reinstatement.” (Bellflower, supra, PERB Decision No. 2544a, p. 42.) But the date on
which an employee resumes work after accepting a reinstatement offer or declines
reinstatement is when new damages normally stop accruing. In contrast, interest on an
amount owed stops accruing on the date of payment.

23
payments. The aim of including interest on monetary awards is to make affected
employees whole (California School Employees Association, Chapter 258 (Gerber)
(2001) PERB Decision No. 1472, p. 2), and daily compounding interest more closely
compensates employees for their losses.
Additionally, to the extent that monetary remedies can deter employers from
engaging in harmful conduct, daily compounding interest is preferable to simple
interest. While our goal is to implement a policy that will more fully compensate victims
of unfair practices, an additional advantage of awarding daily compounding interest is
that it will, ideally, cause employers to comply with their legal obligations more
carefully.
In addition to better serving the remedial policies of the Board, compound
interest, not simple interest, is the norm in many sectors and forums, including credit
card debt and private lending, and is used by the Internal Revenue Service and the
NLRB. In 2010, the NLRB began including daily compound interest on all monetary
relief. (Kentucky River, supra, 356 NLRB 6.) As noted above, California public sector
labor relations precedent frequently protects employee and union rights to a greater
degree than does federal precedent governing private sector labor relations, though
we consider federal precedent for its potential persuasive value. (Operating Engineers
Local Union No. 3, AFL-CIO (Wagner, et al.), supra, PERB Decision No. 2782-M, p. 9,
fn. 10.)
When the NLRB adopted daily compound interest, it reasoned that the change
was in line with its “judicially-approved, evolutionary approach to remedial issues
involving interest on backpay awards.” (Kentucky River, supra, 356 NLRB at p. 6.) The

24
NLRB concluded that compound interest better effectuates make-whole remedies than
the traditional practice of ordering only simple interest, and that, for the same reasons,
interest should be compounded on a daily basis, rather than annually or quarterly. (Id.
at p. 8.) The NLRB further noted that daily compounding conforms to commercial
practice, is used under the Internal Revenue Code and the Back Pay Act, and serves
to deter the commission of unfair labor practices. (Id. at p. 9.)
While not all of the NLRB’s reasons for embracing compound interest hold true
at PERB, the NLRB’s most compelling policy reason is equally applicable to PERB’s
enforcement of unfair practice remedies in the California public sector, that is,
ensuring the completeness of make-whole relief. As the NLRB reasoned:
“‘The purpose of interest is to compensate the [employee]
for the loss of use of his or her money.’ Money, of course,
has a time value: it is more valuable today than it is
tomorrow—or next year. ‘If justice were immediate, there
would never be an award of . . . interest;’ instead, because
justice takes time—and sometimes, as students of the
Board know, a long time—‘interest is added to the original
judgment to ensure that compensation is complete.’ Since
1962, the Board has recognized that an award of interest is
integral to achieving the make-whole purpose of a backpay
award, consistent with the Supreme Court’s
characterization of backpay as ‘an indebtedness arising out
of an obligation imposed by statute,’ and in the years that
followed, the Board has sought to measure the time value
of money more fairly and accurately by adjusting the
interest rate paid on backpay awards.”
(Kentucky River, supra, 356 NLRB at p. 8, internal citations omitted.)
The NLRB further noted that daily compound interest “will lead to more fully
compensatory awards of interest and thus come closest to achieving the make-whole
purpose of the remedy.” (Kentucky River, supra, 356 NLRB at p. 9, citations omitted.)

25
PERB has also categorically determined that fully compensatory make-whole
remedies are key. For instance, there is no question that where an employer does not
fulfill its decision bargaining obligation, PERB’s standard remedy includes rescission
and make whole relief. (Lodi Unified School District (2020) PERB Decision No. 2723,
p. 20; see also County of Kern & Kern County Hospital Authority, supra, PERB
Decision No. 2659-M, pp. 16-19 & 26-27.)
For these reasons, we adopt a new policy under which interest on back
compensation of all types will be compounded on a daily basis. Consistent with the
Board’s practice, we will apply this policy retroactively in this case and in all pending
cases in whatever stage, given the absence of any manifest injustice in doing so.
ORDER
Based on the foregoing and the entire record in this case, the Public
Employment Relations Board (PERB) finds that El Centro Regional Medical Center
(ECRMC) violated the Meyers-Milias-Brown Act (MMBA), Government Code section
3500 et seq., by unilaterally denying a 2021 two percent merit salary increase to
employees in the Laboratory Unit represented by Teamsters Local 542 (Teamsters),
thereby changing the status quo without notice and an opportunity to bargain,
discriminating against Laboratory Unit members because they elected to become
represented by Teamsters, and interfering with rights the MMBA protects.
Pursuant to MMBA section 3509, it hereby is ORDERED that ECRMC, its
governing board and its representatives shall:
A. 	CEASE AND DESIST FROM:
1. 	Unilaterally changing wages for Laboratory Unit employees.

26
2. 	Discriminating against Laboratory Unit employees because they chose to
become represented by Teamsters.
3. 	Denying Teamsters’ right to represent Laboratory Unit employees.
4. 	Interfering with Laboratory Unit employees’ right to be represented by
Teamsters.
B. 	TAKE THE FOLLOWING AFFIRMATIVE ACTIONS TO EFFECTUATE THE
POLICIES OF THE MMBA:
1. 	Compensate with backpay all current and former Laboratory Unit
employees who had commenced employment before January 1, 2021, with an amount
equal to two percent of any wages earned between July 4, 2021 and July 26, 2022,
augmented by interest accrued to the date of payment at an annual rate of seven
percent, compounded daily.
2. 	Within 10 workdays after this decision is no longer subject to
appeal, post at all ECRMC locations where notices to employees in the Laboratory
Unit are posted, copies of the Notice attached hereto as an Appendix. An authorized
agent of ECRMC must sign the Notice, indicating that ECRMC will comply with the
terms of this Order. ECRMC shall maintain the posting for a period of 30 consecutive
workdays. ECRMC shall take reasonable steps to ensure that the Notice is not
reduced in size, altered, defaced, or covered with any other material. In addition to
physically posting this Notice, ECRMC shall communicate it by electronic message,
intranet, internet site, and other electronic means ECRMC uses to communicate with
employees in the Laboratory Unit.13
13 Either party may ask PERB’s Office of the General Counsel (OGC) to alter or

27
extend the posting period, require further notice methods, or otherwise supplement or
adjust this Order to ensure adequate notice. Upon receipt of such a request, OGC
shall solicit input from all parties and, if warranted, provide amended instructions to
ensure adequate notice.
3. 	Notify OGC of the actions ECRMC has taken to follow this Order
by providing written reports as directed by OGC and concurrently serving such reports
on Teamsters.
Members Krantz and Paulson joined in this Decision.

APPENDIX
NOTICE TO EMPLOYEES
POSTED BY ORDER OF THE
PUBLIC EMPLOYMENT RELATIONS BOARD
An Agency of the State of California
After a hearing in Unfair Practice Case No. LA-CE-1566-M, Teamsters Local
542 v. El Centro Regional Medical Center, in which all parties had the right to
participate, the Public Employment Relations Board found that the El Centro Regional
Medical Center (ECRMC) violated the Meyers-Milias-Brown Act (MMBA), Government
Code section 3500 et seq.
As a result of this conduct, we have been ordered to post this Notice and we
will:
A. 	CEASE AND DESIST FROM:
1. 	Unilaterally changing wages for Laboratory Unit employees.
2. 	Discriminating against Laboratory Unit employees because they
chose to become represented by Teamsters Local 542 (Teamsters).
3. 	Denying Teamsters’ right to represent Laboratory Unit employees.
4. 	Interfering with Laboratory Unit employees’ right to be represented
by Teamsters.
B. 	TAKE THE FOLLOWING AFFIRMATIVE ACTIONS TO EFFECTUATE
THE POLICIES OF THE MMBA:
Compensate with backpay all current and former Laboratory Unit
employees who had commenced employment before January 1, 2021, with an amount
equal to two percent of any wages earned between July 4, 2021 and July 26, 2022,
augmented by interest accrued to the date of payment at an annual rate of seven
percent, compounded daily.
Dated: _____________________ 	El Centro Regional Medical Center
By: _________________________________
Authorized Agent
THIS IS AN OFFICIAL NOTICE. IT MUST REMAIN POSTED FOR AT LEAST 30
CONSECUTIVE WORKDAYS FROM THE DATE OF POSTING AND MUST NOT BE
REDUCED IN SIZE, DEFACED, ALTERED OR COVERED WITH ANY OTHER
MATERIAL.