City of Davis (PERB 2582M)

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STATE OF CALIFORNIA
DECISION OF THE
PUBLIC EMPLOYMENT RELATIONS BOARD
DAVIS CITY EMPLOYEES ASSOCIATION,
Charging Party, 	Case No. SA-CE-866-M
v. 	PERB Decision No. 2582-M
CITY OF DAVIS, 	September 5, 2018
Respondent.
Appearances: Beeson, Tayer & Bodine by John Provost, Attorney, for Davis City Employees
Association; Best, Best & Krieger by Stacey N. Sheston and Kimberly E. Hood, Attorneys, for
City of Davis.
Before Banks, Winslow, Shiners, and Krantz, Members.
DECISION
WINSLOW, Member: This case is before the Public Employment Relations Board
(PERB or Board) on the Davis City Employees Association’s (Association) exceptions to the
proposed decision of a PERB administrative law judge (ALJ) dismissing the complaint and the
Association’s unfair practice charge.
The complaint alleged that the City of Davis (City) violated the Meyers-Milias-Brown
Act (MMBA)1 by failing and refusing to meet and confer in good faith over a successor
memorandum of understanding (MOU), and failing and refusing to participate in good faith in
impasse procedures. As evidence of the City’s bad faith during negotiations and impasse
procedures, the complaint alleged that the City engaged in conduct “including, but not limited
to”: (1) maintaining virtually the same inflexible bargaining position since successor contract
1 The MMBA is codified at Government Code section 3500 et seq. Unless otherwise
noted, all statutory references are to the Government Code.

negotiations commenced in 2009; (2) failing to present counter-proposals or respond to the
Association’s proposals; (3) refusing to agree to terms that would require it to change terms of
unrelated bargaining units’ contracts based on parity agreements between the City and other
employee organizations; and (4) refusing to deviate from the objectives set out in a 2009
document titled “Guiding Principles and Objectives for Negotiations Related to Employee
Compensation.”
The ALJ found that these allegations lacked merit, concluding either that the
Association did not meet its burden of proving that the City engaged in the specific conduct
alleged in the complaint, or that the City’s conduct did not constitute evidence of bad faith.
The ALJ also refused to consider two allegations raised at the hearing and argued in the
Association’s post-hearing brief: (1) that the City refused to provide a “target savings”
amount, i.e., how much the City wanted to achieve in concessions from the Association; and
(2) that the City failed to accept the recommendations of a factfinding report and instead
imposed its last, best, and final offer (LBFO). The ALJ determined that these factual
allegations could not be considered because they were not included in the complaint and did
not satisfy the requirements of PERB’s unalleged violation test.
The Association excepts to some of the ALJ’s factual findings and conclusions
regarding the evidence alleged in the complaint, to her refusal to consider the allegations not
included in the complaint, and to her application of the totality of circumstances test for bad
faith bargaining. The City filed no exceptions and asks us to affirm the proposed decision.
The Board has reviewed the Association’s exceptions and the City’s responses thereto,
the proposed decision and the entire record in light of applicable law. Based on this review,
we affirm the dismissal of the complaint and underlying unfair practice charge.
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FACTUAL BACKGROUND
The City is a public agency within the meaning of MMBA section 3501,
subdivision (c), and PERB Regulation 32016, subdivision (a).2 The Association represents a
bargaining unit of City maintenance employees, and is a recognized employee organization
within the meaning of MMBA section 3501, subdivision (b), and an exclusive representative
within the meaning of PERB Regulation 32016, subdivision (b).
The parties’ previous MOU expired on June 30, 2009. In 2009 and 2010, they
unsuccessfully negotiated over a successor MOU. After they reached impasse, the Association
requested factfinding under the City’s local rules. Instead of proceeding to factfinding, the
City imposed its LBFO, including 12 unpaid furlough days and other monetary concessions.
A PERB charge filed by the Association resulted in a finding that the City unlawfully
failed to participate in factfinding. (City of Davis (2012) PERB Decision No. 2271-M.) The
City was ordered to rescind its LBFO and make employees whole, which included
compensating them for the furlough days.
In March 2012, while the City’s exceptions in the prior PERB case were pending before
the Board, the parties began negotiations for a successor agreement. Ken Akins (Akins) served
as the Association’s chief spokesperson, as he had during the 2009-2010 negotiations. The
City retained a new chief negotiator, Timothy Yeung (Yeung).
At the first bargaining session, the City presented a document entitled “Guiding
Principles for Employee Compensation and Objectives for Labor Negotiations.” The City
presented the same document during negotiations with its other bargaining units, and it had
2 PERB Regulations are codified at California Code of Regulations, title 8, section
31001 et seq.
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provided a substantially similar document to the Association during the 2009-2010
negotiations.3
At the parties’ second bargaining session, the City made its opening proposal for a
three-year contract with significant economic concessions from the Association in a number of
areas. These included: (1) requiring employees to share in health insurance cost increases;
(2) capping the monthly health benefit cash-out—which was $1,400 in 2012 and expected to
rise to $1,900—at $500 per month; (3) establishing a vesting period for retiree health benefit
eligibility; (4) requiring employees to begin paying the employee share (8 percent) of pension
benefits; (5) requiring employees to pay half of any increases to the employer’s share of
pension benefits, up to three percent; (6) reducing salaries by 5 percent; (7) either reducing
salaries by an additional 1.25 percent or reducing retiree health benefits, in order to fund
payments to the City’s annual required contribution (ARC) for retiree health benefits;
(8) extending subcontracting of some bargaining unit work; and (9) counting only hours
actually worked toward eligibility for overtime compensation. The City also proposed that the
economic provisions of the MOU would be reopened if the City declared a fiscal emergency.
Beginning early in negotiations, the Association asked for the target savings amount the
City was seeking from the bargaining unit. The City had provided this information during the
2009-2010 negotiations. Yeung explained that while the City’s goal in the previous
negotiations had been immediate expense reductions to address a significant budget gap, it was
3 Both versions of the document included two pages of substantively identical content.
For instance, they declared that “[t]he City’s compensation should, when economically feasible,
be set at levels sufficient to recruit and retain qualified employees who are committed to provide
the highest quality service to the community,” and that “[a]ll compensation commitments must
take into account the financial ability of the City and be consistent with the principles of fiscal
sustainability.” The 2009-2010 version of the document included an additional third page that
was not part of the 2012-2013 version.
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now seeking longer term structural changes in light of the ongoing recession and the City’s
multi-million dollar long term deficit. As a result, Yeung explained, the City did not have a
target savings amount in these negotiations. Rather, he informed the Association that his goal
was to get as much as he could in employee concessions, although he added that the City did
not expect the Association to make up the entire structural deficit by its concessions.
Nevertheless, most of the City’s proposals included the estimated savings that would be
achieved if they were adopted.
The Association’s opening proposal, presented verbally at the fourth bargaining
session, included significant increases in compensation, as well as increases in the boot
allowance and standby and call-out pay. The proposal also included binding grievance
arbitration, allowing employees on weekend standby to take home a City vehicle, allowing
employees to engage in outside employment without restrictions, and moving two
classifications from another bargaining unit to the Association’s unit.
Separately from its other proposals, at bargaining sessions before and after the Board’s
decision in City of Davis, supra, PERB Decision No. 2271-M, the Association offered to waive
the make-whole remedy in exchange for the City’s assurance of no layoffs for a certain period
of time. The City rejected that proposal, citing its severe financial condition. Ultimately, the
City laid off nine unit members. It also laid off 25 non-unit employees around the same time
as part of a broader cost-saving program and restructuring of City services.
At their fifth bargaining session, on May 25, 2012, the parties discussed the
Association’s proposals. The City rejected the Association’s economic proposals because the
City needed concessions to address its budget deficit. The City also rejected the Association’s
other proposals, explaining that it preferred the current dispute resolution procedure and the
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City’s current outside employment policy, which allowed employees to engage in outside
employment as long as there was no conflict of interest. The City committed to addressing the
unit modification proposal away from the bargaining table, since it impacted another
bargaining unit. The City also submitted a revised proposal of its own, reducing its demand
for cost-savings by offering to phase in the reduction of the health benefit cash-out cap over
three years.
At their eighth bargaining session, on July 10, 2012, the City submitted an alternative
proposal for a one-year agreement, which eliminated several of the City’s demands for
concessions, including: (1) the 5 percent salary reduction; (2) the 1.25 percent salary reduction
to fund the City’s ARC; and (3) the employee payment of half of additional increases in the
employer share of pension costs. The proposal also eliminated the reopener provision, which
the Association had expressed concerns about. Yeung testified that he thought a one-year
agreement with more limited concessions would help the parties make progress in negotiations.
Akins made a verbal counterproposal, later confirmed in writing, that included a three-
year phase-in for employees to pay the full employee contribution toward their pension
benefits, with corresponding equivalent annual salary increases; and a three-year phased
reduction of the monthly health benefit cash-out from a $1,500 cap to $1,300. The Association
continued to press for binding grievance arbitration, dropped some of its initial proposals,
maintained others, and expressed its willingness to accept the City’s overtime proposal once
the City obtained the same concession from other units. Yeung responded that the City was
not opposed to some of the Association’s proposals, such as increased standby pay and boot
allowance, but noted that these increases must be part of a total package addressing the
structural changes in employee compensation and benefits sought by the City.
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In September 2012, the parties met for pre-impasse mediation, but did not reach
agreement.
As the City was also bargaining with its other four bargaining units, the Association
asked the City throughout negotiations about its proposals to the other units. The City
responded that it was seeking concessions from all units, and acknowledged that no unit
wanted to be the first to agree to concessions.
At the parties’ tenth bargaining session on October 24, 2012, Akins requested that the
City provide its LBFO. The City did so, with options for a one-year contract or a three-year
contract. The City moved further to bridge the gap between the parties by proposing a cap on
retiree health benefits in exchange for a 3 percent wage increase in the one-year proposal, or
annual increases of 3 percent, 2 percent, and 1 percent, respectively, in the three-year proposal.
Akins promised to take the LBFO to the Association’s members.
On November 7, 2012, Akins reported to Yeung that the membership had rejected the
LBFO. Yeung responded by declaring impasse.
On December 13, 2012, the parties met again with the assistance of a mediator, but did
not reach agreement.
In December 2012 and January 2013, the City reached agreement on successor MOUs
with three other bargaining units. Each MOU was for three years and contained a parity
provision granting to these units any improved economic terms subsequently obtained by
another unit. The City ultimately reached impasse with the remaining unit and imposed its
LBFO.
Yeung testified that Akins was upset when he learned of the “me-too” clauses with
other bargaining units. Akins and Yeung had several conversations about the clauses. Yeung
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stated that the “me-too” clauses did not limit his ability to give the Association better terms.
He stated the City was willing to reach different terms on the core financial issues even if the
City had to provide enhanced terms to the other units, depending on the magnitude of the
increase. Yeung also explained that the City could offer enhancements to the Association in
areas that would not trigger the “me-too” clauses, such as equity increases for specific
classifications.
On February 12, 2013, the City sent the Association a letter asking whether it had
requested factfinding. On March 14, 2013, the Association filed with PERB a request for
factfinding. Although the City believed the Association’s factfinding request was untimely, it
did not challenge the request, wanting to move forward in an attempt to reach agreement.
The parties met for factfinding on five dates in May and June 2013. On three additional
dates within this time period, the parties met with the factfinding panel chair serving as a
mediator, but they did not reach agreement.
The factfinding panel issued its report on October 4, 2013. The panel recommended
most of the structural changes the City was seeking, but implemented more gradually or with
salary increases to offset some of the benefit reductions. The parties met again after the
factfinding report issued, but did not resolve the impasse. The parties did not exchange any
proposals after receiving the factfinding report, and there is no other evidence concerning the
content of this post-report discussion.
On November 19, 2013, the City Council held a hearing on the factfinding
recommendations and the LBFO. Addressing the City Council, Akins asked it to send the
matter back to the bargaining table, claiming that the City had not made any counterproposals.
Yeung also made a presentation to the City Council, in which he stated that the City had
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countered its own proposals, and that the “me-too” clauses could result in increased benefits
for the other bargaining units. The City Council adopted a resolution rejecting the factfinding
recommendations “as insufficient to address the structural changes necessary” and approving
implementation of the LBFO.
DISCUSSION
In determining whether a party has violated its duty to meet and confer in good faith,
PERB uses a “per se” test or a “totality of the conduct” analysis, depending on the specific
conduct involved and its effect on the negotiating process. (Muroc Unified School District
(1978) PERB Decision No. 80, pp. 13-14; Pajaro Valley Unified School District (1978) PERB
Decision No. 51, pp. 4-5.) Per se violations involve conduct that violates statutory rights or
procedural bargaining norms. (Fresno County In-Home Supportive Services Public Authority
(2015) PERB Decision No. 2418-M, p. 13.) A per se violation of the duty to meet and confer
may be found irrespective of the offending party’s intent. (Ibid.)
The totality of conduct test governs bad faith bargaining allegations that our precedent
has not identified as constituting a per se refusal to bargain, including, most typically,
allegations that a respondent has gone through the motions of meeting and conferring but
engaged in surface bargaining. (Mt. Diablo Unified School District (1983) PERB Decision
No. 373, p. 21.) Under this test, “the Board looks to the entire course of negotiations,
including the parties’ conduct at and away from the table, to determine whether the respondent
has bargained in ‘good faith,’ which our precedents describe as a subjective intent to reconcile
differences and reach agreement.” (City of Roseville (2016) PERB Decision No. 2505-M,
p. 10 (Roseville).) This includes considering any per se violations that may bear upon the
question of the respondent’s state of mind. (City of San Jose (2013) PERB Decision
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No. 2341-M, p. 23.) The “ultimate question” is “whether the respondent’s conduct, when
viewed in its totality, was sufficiently egregious to frustrate negotiations.” (Id. at p. 19.)
With this test in mind, we turn to the Association’s exceptions.
Unalleged Matters
In addition to the evidence of surface bargaining alleged in the complaint, the
Association’s exceptions rely on two categories of evidence that the ALJ refused to consider,
because they were not alleged in the complaint and, she determined, failed the unalleged
violation test: (1) the City’s refusal to provide its target savings amount4; and (2) the City
Council’s failure to adopt the recommendations of the factfinding panel. We conclude that the
unalleged violation doctrine did not apply here.
“As its name suggests, the unalleged violation doctrine applies when, if proven, factual
allegations presented at hearing but not included in the complaint would constitute a separate
unfair practice in addition to the theories of liability set forth in the complaint.” (Roseville,
supra, PERB Decision No. 2505-M, p. 18, emphasis omitted.) The Board will consider an
unalleged violation if: “(1) adequate notice and opportunity to defend has been provided to
4 Our concurring colleague claims that the Association’s exceptions do not adequately
address this issue. It is true that the issue is not among those identified as specific exceptions
to the proposed decision. But the Association refers to it throughout its exceptions. (See, e.g.,
Exceptions, p. 8 [the City “said it could not quantify the amount of savings it wanted to
achieve”]; p. 9 [“The City’s chief negotiator testified at length about the City’s desire to
implement ‘structural changes’ in its wage and benefit package, and he told [the Association]
he could not put a dollar figure on the amount of savings the City wanted to achieve . . . ”];
p. 11 [the City “would not give the Association a target amount for the savings it needed”];
p. 16 [“But at the same time that the City was estimating its budget deficit and costing out
the factfinders’ recommendations, it was also telling the Association it could not say how
much money the City wanted to save because what it really wanted were ‘structural
changes’”].) The issue is thus inextricably intertwined with the Association’s other
exceptions. While it is a close question, we err on the side of considering it, particularly in
light of our longstanding policy favoring resolution of disputes on their merits. (Regents of
the University of California (Los Angeles) (2016) PERB Decision No. 2481-H, p. 3, citing
Trustees of the California State University (1989) PERB Order No. Ad-192-H, p. 5.)
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respondent; (2) the acts are intimately related to the subject matter of the complaint and are
part of the same course of conduct; (3) the unalleged violation has been fully litigated; and
(4) the parties have had the opportunity to examine and be cross-examined on the issue.”
(Claremont Unified School District (2015) PERB Decision No. 2459, p. 3.) The purpose of the
unalleged violation test is to ensure “that the Board decides a case based on an unalleged
theory only when it is clear that the parties have been afforded their due process rights.”
(Hacienda La Puente Unified School District (1997) PERB Decision No. 1187, p. 3.)
However, the due process concerns that inform the unalleged violation doctrine do not
require pre-hearing notice of the evidence against the respondent. It is well settled that a
charge need not set forth all of the charging party’s evidence (Roseville, supra, PERB Decision
No. 2505-M, p. 13, citing County of Inyo (2005) PERB Decision No. 1783-M, p. 2), and it
follows that the complaint—which is issued by the Office of the General Counsel based on the
charge allegations—need not either. Moreover, PERB generally does not allow pre-hearing
discovery, and the Board has specifically rejected the argument that the lack of such discovery
violates due process. (King City High School District Association, CTA/NEA; King City Joint
Union High School District; et al. (Cumero) (1982) PERB Decision No. 197, p. 26.)5
These considerations, among others, led us to conclude that the unalleged violation
doctrine does not apply to allegations of conduct that may serve as potential evidence in
5 Our precedents in this area are in accord with general due process principles. (See
Rea v. Workers’ Comp. Appeals Bd. (2005) 127 Cal.App.4th 625, 643 [“Due process requires
notice and a meaningful opportunity to present evidence in regards to the issues. . . . [A]
decision based on different legal theories or issues than presented by the parties, without
affording a meaningful opportunity to be heard or present evidence, violates due process”
(emphasis added)]; Pacific Gas & Electric Co. v. Public Utilities Com. (2015) 237 Cal.App.4th
812, 862 [“Administrative proceedings are not bound by strict rules of pleading. . . . [A]
variance between the allegations of a pleading and the proof will not be deemed material
unless it has actually misled the adverse party to his prejudice in maintaining his action or
defense on the merits” (emphasis in original, citations and internal quotation marks omitted)].)
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support of a surface bargaining allegation. (Roseville, supra, PERB Decision No. 2505-M,
p. 14.) In Roseville, we explained that “the key issue in surface bargaining cases is the
respondent’s state of mind, a matter which is best known by the respondent and one which the
charging party can often establish only through indirect or circumstantial evidence.” (Id. at
p. 13.) This makes it “unrealistic to expect that a surface bargaining charge include all
possible evidence of the respondent’s intent or motive in negotiations.” (Ibid.) We also noted
that the typical surface bargaining complaint alleges that the respondent’s conduct, including
but not limited to specifically pleaded acts or evidence, establishes a failure or refusal to meet
and confer in good faith. (Id. at p. 12.) This pleading practice, we determined, adequately
“identifies the specific acts or indicia that are sufficient to state a prima facie case, while also
giving the respondent notice that . . . these acts or indicia are not exhaustive of the evidence the
charging party may present at hearing.” (Ibid.)
On this issue, Roseville, supra, PERB Decision No. 2505-M, is consistent with the
practices of the National Labor Relations Board (NLRB) concerning conduct that may serve as
evidence of surface bargaining:
The [NLRB] has found violations of surface bargaining based on
general allegations similar to that herein. “[I]t is settled law that
particularity of pleading is not required of a complaint issued by
the Board,” . . . and that the General Counsel is not required to
plead his evidence in its entirety. . . . In an allegation of surface
bargaining, unlike individual acts alleged to be violative of
Section 8(a)(5), the ultimate fact which is alleged is bargaining
with a particular state of mind, as to which the individual acts are
merely the evidence and need not be pleaded.
(SCA Services of Georgia (1985) 275 NLRB 830, 856, citations and footnote omitted; see also
Redburn Tire Co. (2012) 358 NLRB 942, 948 [considering evidence of bad faith “maintained
by the General Counsel but not alleged in the complaint”]; Premier Cablevision (1989)
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293 NLRB 931 [considering certain evidence as indicative of bad faith, even though it was
“not alleged by the General Counsel independently to constitute bad-faith bargaining”];
Clearwater Finishing Co. (1981) 254 NLRB 1168, 1174 [“Although this is background
evidence not alleged in the complaint, it involves company conduct at the bargaining table, and
thus provides an additional reason for rejecting the Company’s argument that such conduct
fails to manifest bad-faith bargaining”]; FMC Corp. (1988) 290 NLRB 483, 497 [considering
unalleged evidence of a per se violation of the duty to bargain (bypassing the exclusive
representative) as potential evidence of bad faith]; J.P. Stevens & Co., Inc. (1978)
239 NLRB 738, 761 [considering additional evidence of bad faith not alleged in the
complaint].)
There is an exception to this rule. Often, evidence of surface bargaining may also
support an independent violation, such as a per se violation of the duty to bargain. Roseville,
supra, PERB Decision No. 2505-M, allows the charging party to introduce such evidence to
prove bad faith bargaining under the totality of conduct test, without moving to amend the
complaint or satisfying the unalleged violation doctrine. (Id. at p. 15.) But if the charging
party also seeks to use the same evidence to prove an independent violation, then it must
either: (1) move to amend the complaint to add the independent allegation; or (2) demonstrate
that the unalleged violation doctrine has been satisfied. (Ibid.) If the charging party does
neither, then the evidence may only be considered to prove bad faith bargaining under the
totality of the conduct test. (Ibid.)
In this case, the Association is not pursuing independent violations based on the City’s
failure to provide its target savings amount or its failure to adopt the factfinders’
recommendations. As a result, these two categories of evidence may be properly considered
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either to prove surface bargaining, or to support the complaint allegation that the City failed to
participate in impasse and factfinding procedures in good faith.6 Because consideration of this
evidence does not expand the City’s liability to include unfair practices not alleged in the
complaint, the unalleged violation doctrine does not apply.
Our concurring colleague argues that, without applying the unalleged violation
doctrine, we may only consider evidence that was specifically alleged in the Association’s
unfair practice charge. In so arguing, he reads Roseville, supra, PERB Decision No. 2505-M,
more narrowly than is appropriate. Although the “unalleged” evidence of surface bargaining in
that case was included in the unfair practice charge, the decision’s rationale was not limited to
those circumstances. It was instead based on the nature of surface bargaining allegations and
the impracticality of requiring a surface bargaining charge or complaint to include all the
charging party’s evidence. (Id. at pp. 12-13.) Nothing in the decision suggests that surface
bargaining charges must detail all the evidence against the respondent, which would make
them unique among unfair practice charges. Therefore, Roseville provides compelling support
for our holding here.
Nor do due process concerns compel a different result. Our concurring colleague fears
that a respondent may not “realize” that certain evidence is being offered at hearing to prove
bad faith bargaining. But, as explained above, due process requires notice of the allegations
against the respondent, not of the evidence in support of those allegations. A respondent that
has received a complaint alleging that it engaged in bad faith bargaining during a particular
course of negotiations may reasonably presume that the evidence introduced at hearing is
intended to prove the complaint’s allegation. If unclear how the evidence being introduced
6 As we explain below, it is not entirely clear whether the Association is pursuing a per
se violation of the duty to participate in good faith in impasse procedures.
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relates to those allegations, a respondent should pose a relevance objection. The concurrence
cites no authority for the proposition that due process requires anything more.7
Nor does the concurrence cite authority for its implicit argument that more detailed
notice of the underlying evidence is required in a surface bargaining case than in other types of
cases. In a surface bargaining case, the alleged violation is failing to bargain in good faith, i.e.,
with the requisite intent to reach an agreement. Specific acts or conduct are merely evidence
of the lack of good faith. (Roseville, supra, PERB Decision No. 2505-M, p. 11.) Some types
of conduct have been recognized as “indicia” of bad faith, but this has no special significance
beyond providing a useful shorthand for the types of conduct PERB and the NLRB have found
to be particularly persuasive evidence of bad faith. As we note at page 29, post, in fact, it
would be possible to prove surface bargaining even without proving any particular indicium.
Undoubtedly, a respondent would find it useful to know in advance of the hearing which
indicia of surface bargaining the charging party believes are established by the evidence.
However, we are aware of no authority (and the concurrence does not cite any) suggesting that
7 The concurrence claims this case illustrates the danger, because the City had no
opportunity to present evidence or argument to rebut the Association’s claim regarding the
target savings issue. But, as the concurrence notes, each party’s chief negotiator testified about
the target savings issue. This testimony may have been brief on both sides, but this
undoubtedly says more about the weakness of the Association’s claim (see post at pp. 19-21)
than it does about whether the City had a fair opportunity to present evidence on it. In fact, the
City’s chief negotiator was asked about this issue on direct examination by counsel for the
City.
As for the City’s lack of opportunity to respond to the arguments in the Association’s
post-hearing brief, this was because the parties and the ALJ agreed upon simultaneous post-
hearing briefs, with no reply briefs. This type of briefing arrangement is not mandatory. (See
PERB Reg. 32212.)
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due process requires notice of those indicia, any more than it requires notice of the particular
cases or other legal authorities the charging party intends to cite in its post-hearing brief.8
The concurrence also claims that our holding unfairly opens the door to a finding of bad
faith bargaining based on a single, unalleged per se violation of the duty to bargain. But such a
finding would still require more than just the evidence of the per se violation; it would also
require evidence of the violation’s effect on the parties’ negotiations. (City of San Jose, supra,
PERB Decision No. 2341-M, p. 19.)
We recognize, of course, that there may be circumstances in which a respondent is
surprised by evidence presented at hearing. This is possible in any case, and cannot justify a
different pleading standard for surface bargaining cases. Rather, any due process concerns can
be addressed on a case-by-case basis, by continuances or scheduling additional days of
hearing, when appropriate. While the concurrence predicts this may burden ALJs with longer
8 As we noted in Roseville, supra, PERB Decision No. 2505-M, the “indicia” of bad
faith are not unlike the “nexus factors” that are recognized as circumstantial evidence of
unlawful motive in a discrimination case. Charges and complaints alleging discrimination
have never been required to allege all the evidence proving that the respondent acted with an
unlawful motive. (Id. at p. 20.)
Our concurring colleague rejoins that the Board will dismiss a discrimination charge
that fails to allege facts establishing an unlawful motive. This is true, but it misses the point.
It is a fundamental principle that a charge must be dismissed if it fails to include sufficient
facts to establish a prima facie case. (PERB Reg. 32620, subd. (b)(5).) This does not mean a
charging party is limited to attempting to prove the evidence or facts that were alleged in the
charge. The Board has never applied such a rule to any type of charge.
We note, however, that the possibility of a charge being dismissed for failure to state a
prima facie case provides a clear disincentive for a charging party to “hide the ball” by
strategically withholding its strongest evidence until the hearing.
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hearings, that outcome is preferable to placing pre-determined and artificial limits on what
evidence constitutes the totality of circumstances in a surface bargaining case.9
Therefore, we conclude that the ALJ erred by applying the unalleged violation test to
the additional evidence of surface bargaining proffered by the Association. We consider the
merits of the Association’s claims regarding this evidence below in the course of addressing
the Association’s remaining exceptions.
Matters Not Presented to the ALJ
The Association’s exceptions also assert that by laying off nine members of the
Association’s bargaining unit, the City intended to punish the Association for successfully
prosecuting its previous unfair practice charge against the City. This argument was not
presented to the ALJ. The Association’s brief to the ALJ mentioned the City’s layoff decision,
but it did not suggest that the decision was motivated by a desire to punish the Association for
its prior PERB charge. Finding no compelling reason to consider a matter that the Association
neglected to mention to the ALJ, we decline to do so. (See Los Angeles County Superior Court
(2018) PERB Decision No. 2566-C, p. 12.)
9 We of course do not hold that an ALJ hearing a surface bargaining case cannot
exclude irrelevant or cumulative evidence offered by a charging party or respondent. While
ALJs must “[i]nquire fully into all issues and obtain a complete record upon which the decision
can be rendered” (PERB Reg. 32170, subd. (a)), they must also “[r]egulate the course and
conduct of the hearing” (PERB Reg. 32170, subd. (d)), and they may exclude “[i]mmaterial,
irrelevant, or unduly repetitious evidence” (PERB Reg. 32176).
As for the concurrence’s concern that ALJs will struggle with how to treat evidence
supporting indicia of bad faith that the respondent did not realize were being offered against it,
we trust that the ALJs will understand our holding—such evidence, having been properly
admitted, should be considered if it is relevant. PERB’s ALJs have, for example, successfully
heard discrimination allegations for decades without requiring the complaint or the charge to
identify the specific facts purporting to show nexus, i.e., the respondent’s unlawful motive.
17

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Similarity of the City’s Guiding Principles in the 2009-2010 and 2012-2013 Negotiations
The ALJ concluded that the similarity between the “Guiding Principles” documents
presented at the outset of the 2009-2010 and 2012-2013 negotiations was not evidence of bad
faith. The Association excepts to this conclusion, arguing that the similarity shows that the
City’s negotiation tactics in 2012-2013 were a “continuation of its unlawful actions in 2009-
2010.” We reject this exception. The City’s unlawful conduct in 2010 was failing to
participate in the factfinding process mandated by its local rules. (City of Davis, supra, PERB
Decision No. 2271-M, pp. 24, 26.) There was no finding in that case, and no evidence in this
one, that the City engaged in surface bargaining during the 2009-2010 negotiations.10
Nor is it evidence of bad faith that the City had similar goals during both rounds of
negotiations. Although the parties began negotiations in 2012 before receiving the Board’s
decision in City of Davis, supra, PERB Decision No. 2271-M, the parties had received the
ALJ’s proposed decision, which ordered the City to rescind the terms it had imposed at the
conclusion of the 2009 negotiations and make employees whole. Yeung testified that he made
clear to the Association that the starting point for the 2012 negotiations would be the 2006-
2009 MOU, i.e., the terms and conditions that were in place before the City’s 2010 imposition.
In other words, the City entered into the 2012 negotiations with the assumption that it would
not realize the benefit of the concessions it had imposed on the Association in 2010. Given
that the City’s financial condition had not substantially improved in the interim, replicating the
2009 proposals in 2012 does not demonstrate surface bargaining. The purpose of our make-
whole order in City of Davis, supra, PERB Decision No. 2271-M, was to restore the parties to
the position they were in before the City unlawfully imposed its LBFO in 2010. The order did
10 We note that the Association points to nothing in either version of the Guiding
Principles suggesting that the City lacked an intent to reach agreement.
18

not prohibit the City from subsequently attempting to achieve the same financial objectives
through lawful good faith bargaining.
The City’s Failure to Provide Its Target Savings
In County of Solano (2014) PERB Decision No. 2402-M, we determined that the
employer’s target savings, i.e., the total dollar amount of savings the employer hoped to
achieve through negotiations, was presumptively relevant information. (Id. at p. 12.) But the
employer in that case had no savings target, and there is no duty to provide non-existent
information. (Ibid.) A union faced with a similar refusal may distinguish County of Solano by
showing, for instance, that the employer has not been diligent in working to locate and collect
information relevant to the request (Regents of the University of California (Davis) (2010)
PERB Decision No. 2101-H, pp. 33-34), or by showing that the employer’s purported lack of
target savings undercuts the employer’s ability to fairly maintain and rationally support its
bargaining position. Indeed, “[t]he obligation to bargain in good faith requires the parties to
explain the reasons for a particular bargaining position with sufficient detail to ‘permit the
negotiating process to proceed on the basis of mutual understanding.’” (County of Tulare
(2015) PERB Decision No. 2461-M, adopting proposed decision at p. 9.) Likewise, “[g]ood-
faith bargaining necessarily requires that claims made by either bargainer should be honest
claims.” (NLRB v. Truitt Mfg. Co. (1956) 351 U.S. 149, 152.) “If . . . an argument is
important enough to present in the give and take of bargaining, it is important enough to
require some sort of proof of its accuracy.” (Id. at pp. 152-153.) An employer’s refusal to
19

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provide information to back up its bargaining claims may be evidence of bad faith bargaining.
(Ibid.)11
In this case, however, even though County of Solano, supra, PERB Decision
No. 2402-M, was decided well before the formal hearing in this case, the Association has made
no attempt to distinguish that case. The City stated at the bargaining table, and its chief
negotiator testified consistently at hearing, that it had not calculated a target savings amount
because it was facing a substantial structural budget deficit that could not be fully addressed
through employee concessions. As a result, the City explained, it had no target amount in
mind. The Association has made no attempt to challenge these assertions, either during
bargaining or during the litigation of this case. For instance, the Association did not, through
follow-up requests for information or public records requests, or in presenting its case at trial,
attempt to test the truth of the City’s claims that it had no target savings amount, or that it was
facing a serious budget deficit.
Nor, as far as the record shows, did the Association request any information relevant to
assessing the amount of savings likely to be achieved by the City’s bargaining proposals. The
City noted in its written proposals the estimated savings that would be achieved by its
11 This principle applies to any situation in which a party possesses data relevant to its
bargaining positions. (E.I. Du Pont & Co. (1985) 276 NLRB 335, 341.) Thus, the bargaining
representative may request information to assess an employer’s claims used to justify
concessionary proposals. (Caldwell Mfg. Co. (2006) 346 NLRB 1159, 1160; see also NLRB v.
Acme Industrial Co. (1967) 385 U.S. 432, 435-436 [discovery-type standard requires
production of documents and information if there is a “probability” that such responsive
material “would be of use to the union in carrying out its statutory duties”].) PERB, similarly,
has held that an employer acts in bad faith if it fails to provide the exclusive representative
with financial information necessary to formulate proposals for alternatives to layoffs.
(Oakland Unified School District (1985) PERB Decision No. 540, p. 18.) The fact that such
information may not exist in precisely the form requested does not relieve the employer of its
obligation to provide what responsive information it does have, or to state its reasons for
failing to do so. (Ibid.; see also Regents of the University of California (Davis), supra, PERB
Decision No. 2101-H, pp. 35-36.)
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proposals. The Association did not introduce competent evidence at hearing showing that the
City failed or refused to respond to any follow-up requests, or that the City concealed or
exaggerated its financial condition.
In sum, the Association did not present evidence that the City was dishonest in denying
that it had a target savings amount, that the City otherwise failed to provide information
requested by the Association, or that the City’s bargaining positions were not fairly maintained
or rationally supported. In these circumstances, we find that the Association has not met its
burden of proof that the City’s conduct demonstrated bad faith.12
The City’s Alleged Inflexibility and Alleged Failure to Provide Responses/Counterproposals
Several of the Association’s exceptions urge us to find that the City maintained an
inflexible position in negotiations, failed to respond adequately to the Association’s proposals,
and failed to provide counterproposals. These exceptions are not supported by the record.
The record shows that the City was firm on some issues, but flexible on others. While
the City was, as the ALJ concluded, “adamant in seeking concessions,” it effectively countered
some of its own economic proposals before the Association submitted its only written
counterproposal. The City also expressed its openness to some minor economic “sweeteners,”
such as increases in standby pay and the boot allowance, if the parties could reach an overall
successor agreement.13
12 Because there is no evidence that the City calculated its target savings, we do not
reach the issue left open in County of Solano, supra, PERB Decision No. 2402-M, viz.,
whether an employer’s target savings is exempt from disclosure on the grounds that it intrudes
upon the employer’s mental processes. (Id. at p. 12, fn. 7.)
13 The Association argues that “conditioning agreement on non-economic matters to a
party’s agreement on economic provisions constitutes bad faith bargaining,” citing Fremont
Unified School District (1980) PERB Decision No. 136 (Fremont I), and invites us to extend
21

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The Association claims the City failed to provide a rational argument for opposing
some of the Association’s non-economic proposals, including binding arbitration, the weekend
standby vehicle policy, the outside employment policy, and moving positions from another unit
to the Association’s unit. To the contrary, for most of these proposals, the evidence is that the
City responded adequately, and for the rest, the evidence is inconclusive.
Regarding binding arbitration, Yeung’s undisputed testimony was that he told Akins the
City was “very opposed” to it, and that “the City was happy with the way things are.” Given
this principle beyond “non-economic matters” to “minor” or “minimally” economic proposals.
We decline the invitation.
As a threshold matter, the rule for which the Association cites Fremont I is already
questionable. Fremont I was vacated in relevant part. (Fremont Unified School District
(1982) PERB Decision No. 136a (Fremont II).) Although it was later cited favorably in a
proposed decision adopted by the Board (San Bernardino City Unified School District (1998)
PERB Decision No. 1270, adopting proposed decision at p. 86), the Board has also held that
the “packaging” of economic and noneconomic proposals is not evidence of bad faith (State of
California (Department of Personnel Administration) (1998) PERB Decision No. 1249-S,
adopting warning letter at pp. 4-5; accord County of Solano, supra, PERB Decision
No. 2402-M, p. 13 [affirming ALJ’s conclusion that “it was not unlawful to place a condition
on a proposal [agreeing to binding arbitration only if the parties reached a total agreement]
unless the condition is outside the control of the parties”]).
Certainly, the refusal to discuss certain issues until agreement is reached on others is
not only evidence of bad faith (Stockton Unified School District (1980) PERB Decision
No. 143, p. 23), it is a per se violation of the duty to bargain (City of San Jose, supra, PERB
Decision No. 2341-M, p. 27.) But this is not the same as a refusal to agree on certain issues
absent agreement on other issues, which, in the above-cited cases, the Board found not even to
be evidence of bad faith.
In addition, extending the Fremont I rule to minor economic issues, as the Association
urges us to do, would also conflict with the well-settled rule that impasse is reached (and the
duty to bargain suspended) “when the parties are deadlocked on one or several major issues,
even if the parties continue to meet and even if concessions on minor issues are possible.”
(Regents of the University of California (1985) PERB Decision No. 520-H, p. 17, emphasis
added; see also California State University (1990) PERB Decision No. 799-H, Proposed
Decision at p. 48 [while secondary issues “could have been ironed out by the parties,” they
were “hopelessly deadlocked on the primary issue,” and “it was not a sign of bad faith” for the
employer “to stick to its position and declare impasse”].) The Association offers no
countervailing reason to upset our case law in this regard. We decline to do so.
22

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that the prior MOU did not provide for binding arbitration, the City’s opposition to binding
arbitration is not necessarily indicative of bad faith. While the City’s explanation was not
detailed, the Association introduced no other evidence about the parties’ experience under their
current grievance procedure, and therefore did not prove that the City’s position was not
rationally supported or fairly maintained.14
With respect to the outside employment policy, the City rejected the Association’s
proposal, explaining that its employee handbook included a City-wide policy permitting
outside employment except where it created a conflict. Yeung and Melissa Chaney (Chaney),
the City’s director of human resources, both testified that after the City provided this
explanation for rejecting the Association’s proposal, the topic did not come up again during
negotiations.
As for the proposed modification of the unit, the City asked to discuss this issue away
from the table, and there is no evidence that the Association objected. Chaney then looked into
the proposed modification and told Akins why the City believed the classifications were in the
appropriate unit. After receiving the City’s explanation, the Association did not pursue the
issue further. But even assuming the City’s responses to this proposal were somehow
inadequate, unit composition, including the appropriate placement of classifications, is not a
mandatory subject of bargaining. (Chula Vista City School District (1990) PERB Decision
No. 834, p. 38.) The Board has never held that a party’s failure to explain its position on a
non-mandatory subject is evidence of bad faith.
Regarding the Association’s standby vehicle proposal, we similarly find no evidence
that the City’s conduct evidenced an intent to frustrate negotiations. Although this was among
14 We also note that the Association did not argue or attempt to prove that the City’s
rejection of binding arbitration was predictably unacceptable.
23

the Association’s opening proposals presented on May 3, 2012, specific reference to the
standby vehicle issue was omitted from the Association’s counter-proposal on July 10, 2012.
By that point, the Association’s proposal was to “incorporate the present standby policy into
the agreement.” Because the Association dropped its standby vehicle proposal on its own, the
City did not act in bad faith by failing to respond to it.
Relatedly, the Association claims that the City failed to offer counterproposals to the
Association’s proposals on these issues. The Association cites Oakland Unified School
District (1981) PERB Decision No. 178 for the proposition that “the failure to offer
counterproposals may be construed as bad faith bargaining if no explanation or rationale
supports the bargaining party’s position.” Because we have rejected the argument that the City
failed to adequately explain its opposition to the Association’s proposals (except with respect
to the standby policy), we conclude that the City’s failure to make counterproposals on the
same subjects is not evidence of bad faith.
In addition to the lack of evidence that the City failed to adequately respond to the
Association’s proposals or explain its own positions, we note that at hearing, the Association
did not contest Yeung’s testimony that the Association never asked the City to respond further
to its proposals. In these circumstances, there is not enough evidence to show that the City
intended to frustrate negotiations by failing to consider and respond to the Association’s
proposals.
Parity Agreements
In two of its exceptions, the Association asks us to find that the City unlawfully tied its
own hands by entering into “me-too” or “parity” agreements with other unions. Under long-
settled precedent, such agreements are not a per se violation of the duty to bargain, but “there
24

may be circumstances when a ‘me-too’ agreement is evidence of bad faith bargaining.”
(Banning Teachers Assn. v. PERB (1988) 44 Cal.3d 799, 807-808; Banning Unified School
District (1985) PERB Decision No. 536.)
In this case, the City’s parity agreements with other bargaining units were not a factor
in the parties’ negotiations. Indeed, the City entered into these agreements after the
Association had already rejected the City’s LBFO and after impasse was declared. While the
Association questions whether the parity agreements played a role earlier than that, the
evidence shows that the City did not discuss parity agreements with the other units until the
first week of December 2012, when another union suggested the concept. The City and the
Association had reached impasse several weeks earlier, on November 7, 2012. And although
the Association claims that the City made clear before the parties reached impasse that it
wanted similar concessions from all of its units, this alone is not evidence of bad faith under
the facts of this case. (County of Solano, supra, PERB Decision No. 2402-M, p. 10; City of
San Ramon (2018) PERB Decision No. 2571-M, p. 8, fn. 10; cf. Regents of the University of
California (1983) PERB Decision No. 356-H, p. 21.) Therefore, the Association has failed to
meet its burden of proving that the City showed bad faith by entering into parity agreements
with other units.
The City’s Rejection of the Factfinders’ Recommendations
The Association argues that the City Council’s refusal to accept or adopt any of the
factfinders’ recommendations is “one more indication of its inflexibility and bad faith in these
negotiations.” While the City’s conduct after the parties reached impasse cannot
independently support a finding that the City failed or refused to bargain in good faith
(Moreno Valley Unified School Dist. v. PERB (1983) 142 Cal.App.3d 191, 201-202), the Board
25

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has left open the possibility that events occurring post-impasse may be probative of whether a
party engaged in surface bargaining before impasse was reached (Fresno County In-Home
Supportive Services Public Authority, supra, PERB Decision No. 2418-M, pp. 53-54, fn. 20).
In this case, however, we conclude that the Association has not met its burden of showing that
the City acted in bad faith.15
We begin by reviewing the factfinding process. Following a declaration of impasse in
negotiations, the MMBA gives a recognized employee organization the right to request that the
parties’ dispute be submitted to a three-member factfinding panel, consisting of a neutral
chairperson and one member appointed by each party. (§ 3505.4, subd. (a).) The factfinding
panel is empowered to hold hearings, conduct investigations, and ultimately make findings and
recommendations to resolve the bargaining dispute. (§§ 3505.4, subd. (c), 3505.5.) The
panel’s recommendations are not binding on either party, and the public agency is free to
implement its LBFO after holding a public hearing on the impasse. (§§ 3505.5, 3505.7.)
Although they are not binding, “the factfinder’s recommendations are a crucial element
in the legislative process structured to bring about peacefully negotiated agreements.”
(Modesto City Schools (1983) PERB Decision No. 291, p. 36 (Modesto).)16 Their function “is
15 This conclusion makes it unnecessary to decide whether the Association is also
relying on the City Council’s treatment of the factfinding report to support a separate violation
of section 3506.5, subdivision (e), which makes it unlawful for a public agency to “[r]efuse to
participate in good faith in an applicable impasse procedure.” The Association points out that
the complaint alleges a violation of section 3506.5, subdivision (e), but the Association’s
exceptions only refer to the City’s conduct in this regard as “additional evidence of bad faith”
and “one more indication of [the City’s] inflexibility and bad faith in these negotiations”
(emphasis added).
16 Because we have not specifically considered the scope of the duty to participate in
good faith in factfinding procedures under the MMBA, it is appropriate to rely on precedent
interpreting the similar factfinding provisions found in the Educational Employment Relations
Act (§§ 3548.1-3548.3) and the Higher Education Employer-Employee Relations Act
26

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to change the circumstances of bargaining by providing an impetus for settlement of the
parties’ dispute.” (Id. at p. 37.) To discharge their duties to participate in good faith in
statutory impasse procedures (MMBA, § 3506.5, subd. (e); PERB Regs. 32603, subd. (e),
32604, subd. (d)), both parties must “consider the recommendations [of the factfinding panel]
in good faith to determine whether there is a basis for settlement, or for such accommodations,
concessions, or compromises that might lead to settlement.” (Charter Oak Unified School
District (1991) PERB Decision No. 873, p. 9, citing Modesto, supra, PERB Decision No. 291.)
“As a result of this process, either party or both parties may decide in good faith that the
factfinding report does not provide a basis for settlement or movement that could lead to
settlement.” (Ibid.)
The Association appears to argue that the City Council should have adopted some or all
of the factfinding panel’s recommendations to implement the proposed structural changes over
a more gradual time period or with offsetting salary increases. This is not the law. While
factfinding is intended to forge a path out of impasse, neither party is required to follow that
path by accepting the recommendations. (MMBA, § 3505.7.)
The Association alternatively appears to argue that the City failed to satisfy its duty to
consider in good faith the factfinding report’s recommendations. Here, the Association relies
solely on what it claims is the inconsistency between the City Council resolution, which stated
that the recommendations were “insufficient to address the structural changes necessary,” and
the factfinding report, which recommended many of the structural changes the City wanted.
This is a closer question.
(§§ 3591-3593). (See San Diego Housing Commission v. Public Employment Relations
Bd. (2016) 246 Cal.App.4th 1, 13; County of Contra Costa (2014) PERB Order
No. Ad-410-M, p. 32.)
27

We agree that the City Council’s resolution did not explain as clearly as it might have
why it was rejecting the factfinding report. On this record, however, referring to the resolution
alone does not complete the Association’s task of showing that the City failed to consider the
factfinding report in good faith. The Association provided no evidence regarding what
occurred when the parties met to discuss the factfinding report before the City Council
considered it. In the absence of such evidence, the record is insufficient for us to conclude that
the City failed to adequately explain its position on the report, or otherwise demonstrated a
failure to consider the report in good faith.
We therefore find that the Association did not satisfy its burden of proving that the City
failed to consider in good faith the factfinding report.
Totality of the Circumstances
The Association also takes exception to the manner in which the ALJ analyzed the
totality of circumstances in this case. It argues that it is “not clear” whether the ALJ was
applying the per se test or the totality of the conduct test, because she addressed each of the
indicia of surface bargaining alleged in the complaint, concluded that they did not establish bad
faith bargaining, and never analyzed them in their totality.
The Association’s argument seems to be that even if no single portion of the City’s
conduct was sufficient to establish a recognized indicium of bad faith or a per se violation, the
totality of the City’s conduct could still add up to a finding of bad faith. We acknowledge this
possibility, and we note the following cautionary observation by the NLRB:
Any student of Board law could contrive a script by which a party
could bargain indefinitely without reaching agreement and
without exposing any of the specific indicia heretofore pointed
out by the Board in surface bargaining decisions. . . . The danger
to the trier of fact is that he becomes so engrossed with an
examination of each individual alleged indicium that he fails to
28

note the broad picture. In short he can’t see the forest for the
trees.
(Milgo Industries, Inc. (1977) 229 NLRB 25, 30.)
Read in isolation, some of the ALJ’s conclusions might suggest that she was
considering whether each alleged indicium of bad faith was sufficient on its own to sustain a
finding of surface bargaining. However, we have reviewed the record under the totality of the
circumstances test, keeping in mind the possibility that a party might weave together otherwise
lawful conduct in a manner that amounts to bad faith. We find that the bad faith allegations
reviewed above are individually unproven and also not probative of bad faith when aggregated.
Therefore, the Association failed to prove that the City engaged in surface bargaining,
and we affirm the ALJ’s dismissal of the complaint.
ORDER
The unfair practice charge and complaint in Case No. SA-CE-866-M are hereby
DISMISSED.
Members Banks and Krantz joined in this Decision.
Member Shiners’ concurrence begins on page 30.
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SHINERS, Member, concurring: I agree with my colleagues that the Davis City
Employees Association (Association) did not prove that the City of Davis (City) engaged in
surface bargaining during 2012-2013 contract negotiations or participated in bad faith in
impasse procedures following those negotiations. I therefore join the majority opinion, except
for its discussion of whether the City’s refusal to provide a target amount of savings it was
seeking from the Association through concessions demonstrated bad faith.17 In my view, the
Board cannot consider that allegation for two reasons.
1. 	The Association Waived the Target Savings Allegation By Not Specifically
Excepting to the ALJ’s Refusal to Consider It
“An exception not specifically urged shall be waived.” (PERB Reg. 32300, subd. (c).)
That is what happened here. In the proposed decision, the administrative law judge (ALJ)
declined to consider the following two allegations of bad faith, finding that neither satisfied
PERB’s test for considering an unalleged violation: (1) the City acted in bad faith by failing to
adopt any of the factfinding report’s recommendations and (2) the City acted in bad faith by
refusing to provide a target savings amount. The Association specifically excepted to the
ALJ’s refusal to consider the allegation about the factfinding report, but did not specifically
except to her ruling regarding the target savings amount. By not doing so, the Association
waived any challenge to the ALJ’s refusal to consider the target savings allegation as evidence
of the City’s bad faith.
The majority admits that the Association did not file a specific exception regarding this
allegation but nonetheless concludes it can consider the issue, citing decisions where a filing
substantially complied with PERB’s Regulations. I disagree that there was substantial
17 My disagreement with the majority is based solely on procedural grounds. If this
allegation were properly before the Board, I would join the majority opinion in full.
30

compliance here. PERB Regulation 32300, subdivision (a) requires a statement of exceptions
to:
(1) State the specific issues of procedure, fact, law or rationale to
which each exception is taken;
(2) Identify the page or part of the decision to which each
exception is taken;
(3) Designate by page citation or exhibit number the portions of
the record, if any, relied upon for each exception;
(4) State the grounds for each exception.
The Association’s exceptions mention the City’s refusal to provide a target savings
amount in three places: (1) in its summary of the proposed decision’s factual findings, (2) in
support of its contention that its proposals were not predictably unacceptable, and (3) in
support of its argument that the City participated in factfinding in bad faith by not
implementing the structural changes recommended in the factfinding report. Each of these
instances states the City’s refusal to provide a target savings amount as a fact, but none takes
issue with the ALJ’s refusal to consider this fact as evidence of bad faith bargaining. Because
these cursory mentions of target savings do not substantially comply with the requirements of
PERB Regulation 32300, subdivision (a), the Board cannot consider whether the City’s refusal
to provide a target savings amount to the Association indicates bad faith. From my review of
the exceptions, it is clear the Association has abandoned its argument that the City’s refusal to
provide a target savings amount showed bad faith. The majority nonetheless goes to great
lengths to address this discarded argument. Consequently, although I believe consideration of
this issue runs afoul of Regulation 32300, subdivision (c), I must address the majority’s
unwarranted extension of City of Roseville (2016) PERB Decision No. 2505-M (Roseville) in
service of an argument the Association could have made, but did not.
31

2. 	Roseville Does Not Allow The Board to Consider the Target Savings Allegation as
Evidence of Bad Faith
In my view, Roseville permits an ALJ or the Board itself to consider indicia of surface
bargaining that were not alleged in the complaint only when they were alleged in the
underlying unfair practice charge. In Roseville, the charging party excepted to “the ALJ’s
refusal to consider several matters which were alleged in [its] unfair practice charge, but
which were not included in the complaint or were not identified as evidence of the City’s bad
faith in negotiations.” (Roseville, supra, PERB Decision No. 2505-M, p. 2, emphasis added.)
Accordingly, the Board considered “[w]hether various matters alleged in the charge, which
were neither dismissed nor identified in the complaint as evidence of bad faith, should be
considered under PERB’s unalleged violations doctrine.” (Id. at p. 6, emphasis added.)
Although it did not find the unalleged violations doctrine applicable, the Board agreed with the
charging party “that the ALJ’s refusal to consider matters alleged in the charge but not
included in or identified as evidence . . . in the complaint was contrary to the language and
purpose of [PERB’s] Regulations.” (Id. at p. 14, emphasis added.) The Board then set out a
general rule:
Thus, as a general rule, we conclude that a complaint alleging
surface bargaining need identify only those factual allegations that,
in the opinion of the Office of the General Counsel, are sufficient
to state a prima facie case, while other facts, which are probative of
the respondent’s conduct or state of mind during negotiations and
which were alleged in the charge, may be established through
competent evidence at hearing and appropriately considered,
without amending the complaint.
(Id. at p. 15, emphasis added.)
The Board reiterated this rule on the following page:
However, when the factual allegations supporting a surface
bargaining allegation involve only conduct that is not itself
unlawful, the totality of conduct test and longstanding PERB
32

practice and procedure dictate that the charging party be allowed
to put on all competent, probative, and non-cumulative evidence
concerning the respondent’s conduct and state of mind during
negotiations, as alleged in the charge, regardless of whether
such evidence corresponds to factual allegations or indicators of
bad faith identified in the complaint.
(City of Roseville (2016) PERB Decision No. 2505-M at p. 16, emphasis added.)
Turning to the complaint in that case, the Board stated:
In our view, the complaint was sufficient to put the City on notice
that it stood accused of surface bargaining and that, in accordance
with well-settled Board law, this allegation would be decided
based on the totality of competent, probative and non-cumulative
evidence put on at hearing regarding the City’s state of mind,
including matters alleged in the charge, but not specifically
identified in the complaint. Consequently, we conclude that
those indicia of bad faith alleged in the charge which are not
independent unfair practices and thus, if proven, would not
expand the scope of the City’s liability, were reasonably
contemplated by the complaint.
(Id. at p. 17, emphasis added.)
The Board went on to say in the following paragraph:
Contrary to the proposed decision, we find it unnecessary and
improper to require the charging party to move to amend the
complaint to identify indicators of bad faith alleged in the charge
but not set forth in the complaint, when such evidence is offered
solely to support a surface bargaining allegation alleged in the
complaint.
(Ibid., emphasis added.)
The statements from pages 15 and 16 quoted above appear in the section of the decision
discussing what notice of factual allegations is sufficient to satisfy due process requirements. I
therefore read Roseville as holding that due process requirements limit an ALJ or the Board
itself to only considering indicia of surface bargaining that were alleged in the charge. The
33

Board’s application of the rule on page 17 of the decision, as quoted above, supports this
reading.
The application of Roseville in this case is simple. The Association’s charge did not
allege that the City’s failure or refusal to provide a target savings amount indicated bad faith.
Consequently, the Board cannot consider the Association’s belated argument—made for the
first time in its post-hearing brief after the evidentiary record closed—that the City acted in
bad faith by refusing to provide a target savings amount.
Despite Roseville’s numerous references to indicia and evidence of bad faith “alleged in
the charge,” the majority claims the Board did not intend to limit the evidence in surface
bargaining cases to evidence that supports indicia alleged in the charge or complaint. Rather,
the majority declares that Roseville allows an ALJ or the Board itself to consider any evidence
in support of a surface bargaining allegation, even if, as here, the evidence supports an
indicium of surface bargaining not alleged in the case until after the close of the evidentiary
record. I disagree with the majority’s extension of Roseville for several reasons.
a. 	The Majority Misinterprets Roseville
The majority’s reinterpretation of Roseville is contrary to well-established rules of legal
interpretation. “[T]he language of an opinion must be construed with reference to the facts
presented by the case; the positive authority of a decision is coextensive only with such facts.
[Citation.]” (PLCM Group v. Drexler (2000) 22 Cal.4th 1084, 1097.) The issue before the
Board in Roseville was whether the ALJ should have considered indicia of bad faith that were
alleged in the charge but not alleged in the complaint. The Board ruled that the ALJ erred in
not considering evidence supporting those previously alleged indicia. But the issue of whether
indicia not alleged in the charge may be considered in support of a surface bargaining theory
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was not raised by the facts of the case. Thus, the Board could not have decided that issue, and
consequently its holding did not encompass indicia not alleged in the charge.
Moreover, if the Board’s intent in Roseville was to set out the broad rule the majority
announces today, i.e., that an ALJ or the Board itself may consider evidence in support of an
indicium of bad faith that was not alleged in the charge, it should have done so clearly at the
time (although, as noted above, such a rule would have been dicta because the facts before the
Board did not raise that issue). Roseville’s repeated references to evidence and indicia “alleged
in the charge” does not put respondents on notice that they should be prepared to rebut
evidence that supports indicia not alleged in the charge or complaint. Although the majority
provides such notice in this case, it does so by extending Roseville, not by clarifying it.
The majority also asserts that limiting consideration of surface bargaining indicia to
those alleged in the charge would create a higher pleading standard for surface bargaining
cases. In support of this assertion, the majority relies on PERB’s practice of not including in a
complaint alleging discrimination the specific evidence or “nexus factors” showing the
respondent acted with unlawful motive. But this practice does not prove the majority’s point
because the omission of such “factors” from the complaint does not mean they were not
alleged in the charge. Indeed, as Roseville notes, “PERB discrimination complaints typically
omit the specific nexus factors or any other facts alleged in the charge to establish unlawful
motive.” (Roseville, supra, PERB Decision No. 2505-M, p. 20, emphasis added.)18 The
18 The majority’s claim that unfair practice charges alleging discrimination need not
allege facts showing the respondent’s unlawful motive is demonstrably false, as PERB
routinely dismisses charges that fail to allege such facts. (E.g., County of San Diego (2012)
PERB Decision No. 2258-M, adopting warning letter at p. 3; City & County of San Francisco
(2009) PERB Decision No. 2075-M, p. 6; Los Angeles Community College District (1997)
PERB Decision No. 1222, adopting dismissal letter at pp. 2-4; Charter Oak Unified School
District (1984) PERB Decision No. 404, pp. 4-5.)
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majority’s reliance on the practice in discrimination cases therefore misses the mark because it
does not address whether an ALJ or the Board itself may consider evidence of unlawful
motivation not alleged in the charge.
b. 	The Majority’s Extension of Roseville Promotes Inefficiency and Gamesmanship
Under the majority’s extension of Roseville, a charging party could allege in the charge
facts sufficient for a complaint to issue, then at hearing present different facts supporting
different indicia of surface bargaining. Not only would this make a mockery of PERB’s charge
investigation process, it would force the respondent to defend at hearing an entirely different
case than the one for which it prepared based on the pleadings. The majority brushes off this
concern by noting that the respondent could ask for a continuance or schedule additional days
of hearing to respond to unanticipated evidence. But this would solve the problem only if the
respondent became aware during the hearing that this unexpected evidence was being offered
to support an indicium of bad faith not previously alleged in the case. When a charging party
raises an indicium for the first time in its post-hearing brief—as the Association did here—the
respondent no longer has the ability to put on additional evidence related to that indicium,
thereby allowing the charging party to successfully hide the ball.
The majority’s new rule also increases the burden on ALJs. If the solution to
unanticipated evidence is to schedule additional hearing days, hearings will go longer so
respondents can rebut evidence of indicia alleged for the first time at the hearing. And if the
respondent does not deduce at the hearing that a new indicium is being alleged, the ALJ will
have to struggle with how to handle the evidence supporting an indicium raised for the first
time after the record has closed, as the ALJ did here. On the other hand, limiting the charging
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party to litigating the bad faith conduct alleged in the charge places no significant burden on
the charging party, promotes efficiency, and discourages chicanery.
c. 	The Majority’s Extension of Roseville Allows Due Process Violations
The most troubling aspect of the majority’s extension of Roseville is that it allows a
violation to be found based on evidence the respondent may not have realized was being
offered for the purpose of proving bad faith bargaining, thereby violating the respondent’s due
process rights. The charge in this case did not allege the City’s refusal to provide a target
savings amount as an indicium of surface bargaining, so naturally the complaint did not
include such an allegation. At the hearing the parties’ chief negotiators briefly testified about
the Association’s request for a target amount and the City’s response. But the Association did
not indicate in its opening statement or at any time during the hearing that it considered the
City’s refusal to provide a target savings amount to indicate bad faith. Instead, the Association
waited until its post-hearing brief—filed simultaneously with the City’s post-hearing brief—to
claim for the first time that the City’s refusal to provide a target savings amount indicated bad
faith surface bargaining.19 Thus, the City had no opportunity before the record closed to
present evidence or argument to rebut the Association’s claim.
The majority’s conclusion that the City’s refusal to provide a target savings amount did
not indicate bad faith in this case does not dispel the possibility of due process violations in
future cases. To reach the target savings issue, the majority relies on Roseville’s distinction
19 Claiming no due process problem exists in this scenario, the majority analogizes it to
one where“notice of the particular cases or other legal authorities [it] intends to cite in its post-
hearing brief.” (Majority Opinion, p. 16.) This is argument reductio ad absurdum, as neither
due process nor PERB’s regulations require prior notice of legal authority. Our regulations,
however, do entitle a respondent to notice of “the facts and conduct alleged to constitute an
unfair practice” (PERB Reg. 32615, subd. (a)(5)), a requirement that comports with principles
of due process.
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between per se bad faith bargaining allegations and surface bargaining allegations for pleading
and evidentiary purposes. (Majority Opinion, pp. 13-14.) But under City of San Jose (2013)
PERB Decision No. 2341-M (San Jose), a single indicium of surface bargaining may have
such a detrimental effect on negotiations that, standing alone, it is sufficient to prove bad faith
bargaining. (Id. at pp. 19, 32-33, 37-39.) The majority thus allows a scenario whereby
evidence supporting a surface bargaining indicium not alleged in the charge enters the door
through Roseville, and can then transform into a per se bad faith bargaining violation under
San Jose, rendering the Roseville distinction meaningless.20 In my view, imposing liability in
such circumstances would violate the respondent’s due process rights. Accordingly, I
respectfully decline to join the majority in untethering Roseville from its due process moorings.
20 This scenario is reminiscent of “Schrödinger’s Cat,” a thought experiment proposed by
physicist Erwin Schrödinger, in which he postulated that under the theory of quantum physics,
it would be possible for a cat in a closed box to be both simultaneously alive and dead until the
moment that it is observed. (See Erwin Schrödinger, The Present Situation in Quantum
Mechanics, in Naturwissenschaften (1935).) Here, the unalleged indicium would exist
simultaneously as both evidence of surface bargaining and a per se violation until the
decisionmaker opens the box after the evidentiary record has closed and deems the indicium to
be of one type or the other.
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