Federation of Oregon Parole & Probation Officers v. State, Department of Corrections

RIGGS, J. The Federation of Oregon Parole and Probation Officers (FOPPO) seeks review of an Employment Relations Board (ERB) order. The order determines that the state did not commit an unfair labor practice by refusing to bargain with FOPPO regarding the impacts of an intergovernmental agreement to transfer certain corrections officers from state employment to employment by Multnomah County. We reverse and remand. This is the second time this case has been before us. In Federation of Oregon Parole v. Dept. of Corrections, 119 Or App 355, 357-58, 850 P2d 1154 (1993) (FOPPO 7), we described the operative facts: “Before 1991, Multnomah County provided only misdemeanant parole and probation supervision; felony parole and probation supervision was provided by the state. Accordingly, the parole and probation officers who supervised felons in Multnomah County were state employees. They were represented by FOPPO. “In 1991, Multnomah County decided to exercise its discretion under ORS 423.550 to provide parole and probation services for felons. The state and county were required by ORS 423.550(1) to negotiate an intergovernmental agreement so that the parole and probation officers supervising felons could go to work for the county. FOPPO demanded to bargain over both the decision to transfer and the decision’s impact. The state refused the demand and formalized the intergovernmental agreement without FOPPO’s input. “The state parole and probation officers who supervised felons became county employees. County parole and probation officers have a lower salary level than their state counterparts. Although the former FOPPO members did not receive a pay cut their pay was ‘red-lined,’ which means that their merit raises were postponed until the pay of similarly situated county employees caught up. Other changes in their conditions included different insurance benefits, one less holiday and less access to firearms. They were placed in an existing bargaining unit represented by the American Federation of State, County and Municipal Employees (AFSCME). “FOPPO filed an unfair labor practice complaint with ERB, charging that the state and county had improperly refused FOPPO’s demand to bargain over the decision and [409] impact of the intergovernmental agreement. ORS 243.672-(l)(e); ORS 423.550. The Board ruled that the state could refuse to bargain with FOPPO because the state was required to approve the intergovernmental agreement if that agreement conformed to the statutory requirements. The Board also ruled that the county could not bargain with FOPPO before or after the transfer, because FOPPO was never the exclusive representative of the county officers.” (Footnote omitted.) On review of that order, we concluded that, because ORS 423.550 gives the state no real discretion to resist a county’s bid to transfer functions, the state had no duty to bargain over the transfer decision itself. We held, however, that ERB’s order did not adequately explain its reasons for dismissing FOPPO’s complaint with respect to its demand to bargain over the impact or effects of the transfer: “ERB’s conclusion regarding impacts does not logically follow either as a consequence of the state’s right to refuse to bargain over the transfer decision or otherwise. The state, through collective bargaining, could have softened some of the predictable negative effects of the impending transfer when FOPPO demanded bargaining. If FOPPO had negotiated a higher salary with the state in anticipation of the transfer, ORS 423.550(2)(c) would have required the county to pay that salary after the transfer. That would have mitigated some of the workers’ anticipated losses. Even if the parties never reached an agreement, good faith bargaining might tend to lessen labor tensions concerning the proposed transfer.” Federation of Oregon Parole v. Dept. of Corrections, supra, 119 Or App at 360. We remanded the order to ERB for reconsideration of the impact bargaining issue. In its order after remand, ERB reasserted its original conclusion, that the state’s refusal to bargain with FOPPO was not an unfair labor practice under ORS 243.672(1)(e), and attempted to explain its reasoning more fully. In making its determination, ERB focused primarily on whether the state made a unilateral change in employment conditions. Under the “unilateral change” doctrine “[a]n employer may not unilaterally make a change in one of the conditions of employment about which the employer is required to negotiate and bargain in good faith with the [410] workers or their representative. See Labor Board v. Katz, 369 US 736, 82 S Ct 1107, 8 L Ed 2d 230 (1962).” Salem Police Employees Union v. City of Salem, 308 Or 383, 393 n 7, 781 P2d 335 (1989). Such changes constitute a per se violation of the statutory duty to bargain in good faith. Wasco County v. AFSCME, 46 Or App 859, 861, 613 P2d 1067 (1980). Applying the per se rule, ERB reasoned that, because the state did not initiate the transfer decision, it did not unilaterally change employment conditions and could not be held liable for refusing to bargain over the impacts arising from that decision. FOPPO takes issue with that conclusion, arguing that even if the decision to transfer was a fait accompli, the state had the ability to negotiate a transfer agreement that would mitigate or eliminate the harmful impacts of the transfer on the affected employees. We review ERB’s decision for errors of law, ORS 183.482(8)(a), and agree with FOPPO. As we held in FOPPO I, the state could not reject the county’s decision to assume responsibility for felony parole and probation services. See ORS 423.550(1). That decision is left solely to the discretion of the county under ORS 423.550(2)(b). However, as required by statute, the state and county entered into an intergovernmental agreement that provided, inter alia, that certain employment conditions, such as wages and benefits, would remain constant. Some elements of the intergovernmental agreement were prescribed by statute: “Those statutes state that the receiving employer cannot cut the salaries or retirement eligibility of transferred employees, ORS 423.550(2)(c); that transferred employees can retain accrued sick leave and certain vacation leave, ORS 236.610(2); and that transferred employees must receive the same benefits, hours and conditions of employment enjoyed by the county’s other employees. ORS 236.620(4).” Federation of Oregon Parole v. Dept. of Corrections, supra, 119 Or App at 359. However, the statutoxy scheme that protects the rights of transferring employees does not preclude the inclusion of additional terms or conditions in intergovernmental transfer agreements: [411] “The rights that the statutes require to be extended to transferred employees are not necessarily exhaustive of the rights that can be conferred on them, if other sources of rights consistent with the statutes exist.” Gish v. Douglas County, 109 Or App 84, 89, 817 P2d 1341 (1991). (Emphasis in original.) Although the state was ultimately required to accept the intergovernmental agreement, it was not devoid of control over the terms under which its employees would transfer from state to county employment. In the course of negotiations with the county, the state had some influence over the content of the intergovernmental agreement. In fact, the state purported to have a “strong interest” in protecting the interests of its employees, and indicated that it would not approve the transfer plan until the county responded to specific issues. Yet, preparation of that agreement occurred without any input from the employees subject to transfer. Collective bargaining would have alerted the state to its employees’ concerns about the effects of the impending transfer.1 Although FOPPO could not have been a party to the intergovernmental agreement, it was entitled to present to the state its members’ needs and concerns. The state acted unilaterally by forging an agreement with the county that outlined the terms of the employee transfer and ultimately affected employment conditions.2 Application of the unilateral change doctrine to the situation here prevents the state from frustrating its employees’ right to bargain and comports with the policy concerns identified in [412] the Public Employees Collective Bargaining Act (PECBA). See ORS 243.656. The obligation to undertake collective bargaining does not mean that the parties must come to an agreement or make concessions. ORS 243.650(4). At a minimum, PECBA requires that, on issues subject to bargaining, public employers and employees come together in good faith and acknowledge the legitimate interests of the other. That requirement ensures that employees will be consulted about decisions that will have an impact on them, thus promoting the. legitimate and well-recognized goals of promoting peace in the workplace and preserving order in government operations. As ERB acknowledged in its order, “bargaining could have benefitted [FOPPO’s] members.” Insofar as the substantive issues at stake, that may or may not be true. Nevertheless, it might be true, and by refusing to bargain with FOPPO over the impacts of the transfer decision, the state committed an unfair labor practice under ORS 243.672(l)(e). ORS 243.676(2) authorizes ERB to devise an appropriate remedy in the event a party commits an unfair labor practice. Such remedies include “affirmative action” necessary to effect the purposes of PECBA, ORS 243.676(2)(c), and the designation of representation costs or attorney fees to the prevailing party. ORS 243.676(2)(d), (e). Unlike the concurrence, we do not believe that ERB’s authority on remand is limited solely to assessing representation costs and attorney fees against the state. Our only consideration here is whether the state committed an unfair labor practice under ORS 243.672(l)(e). We leave the task of fashioning a remedy to ERB, which has broad authority under ORS 243.676, and decline to preemptively limit that authority on remand. Reversed and remanded. Footnotes [1] As we described above, the transferred employees’ merit increases were postponed, their insurance benefits were changed, they received one less holiday and less access to firearms. [2] We note that this case does not present, as FOPPO suggests, a typical “subcontracting” situation. The state did not replace FOPPO-represented employees with employees from outside the bargaining unit to perform the same duties. See Salem Police Employees Union v. City of Salem, supra, 308 Or at 395-96 (city required to bargain over impact of future implementation of reserve police officer program). Rather, this is a situation in which the state discontinued providing a particular service, and its employees and their duties were transferred to a separate government entity. This case is also distinct from the facts before us in Oregon State Police Officers Assn. v. State of Oregon, 127 Or App 144, 871 P2d 1018 (1994), in which we held that the state was not required to bargain over the potential impact of higher parking rates unilaterally imposed by a third party. In that case, the employer had no control over the action that affected its employees’ working conditions.