Monday, February 16, 2015

PERB: Blanket Restrictions on Communications Interfere with Protected Rights

The Public Employment Relations Board's recent decision in Los Angeles Community College District (2014) PERB Decision No. 2404 held blanket restrictions on communications may interfere with employees' right to engage in concerted activity. This long awaited decision brings PERB alongside National Labor Relations Board precedent holding "blanket" instructions to employees to maintain confidentiality during a workplace investigation may interfere with protected activities if they are overbroad and the employer lacks a proper business justification.

In Los Angeles Community College District, a professor disagreed with the District reducing his work hours and salary. He made statements to students and handed out materials criticizing District administration. The District placed the professor on administrative leave pending a fitness for duty evaluation and issued the following admonishment: "You are hereby directed not to contact any members of the faculty, staff, or students."

PERB ruled the directive interfered with the professor's protected activities. PERB found the District's directive was overbroad and contained no qualifiers limiting its scope. Although the directive did not explicitly restrict protected rights, PERB found "the directive not to contact faculty, staff or students would reasonably be construed to prohibit the employee from participating in a variety of protected activities including discussing working conditions with his coworkers or union, or initiating a grievance." In addition, the District lacked a business justification for the directive.

This case law may have practical application to public safety professionals subject to personnel investigations because many agencies issue admonish them from communicating with coworkers during the investigation. Employee organizations should insist that internal affairs confidentiality directives are narrowly tailored, for example, limited to witnesses who have not been interviewed. Overbroad gag orders will likely give rise to an unfair labor practice.

Monday, February 9, 2015

California Court of Appeal Strikes Blow to Employee Pension Rights

On January 22, 2015 the California Court of Appeal changed how the Legislature can change pension benefits under a contract.  The Legislature may change current contractual pension benefit formulas for new employees. But, the Legislature may not alter pension contribution requirements under a current contract.

In DeputySheriff’s Association of San Diego County v. County of San Diego the County and Deputy Sherriff's Association had a memorandum of understanding. The contract contained provisions related to pension benefits. The contract's pension formula for members was 3 percent at 55. The contract also required the employer to pay a percentage of the employee’s pension contribution.
The California Public Employees’ Pension Reform Act of 2013 went into effect on January 1, 2013. The Act required that new safety members receive less than 3 percent at 55. PEPRA also limits employer contributions. Employers may not cover an employee's required contributions. The DSA argued PEPRA unconstitutionally impaired the contract terms. If a contract is in place then the Legislature cannot alter it until it expires. 
The Court of Appeal did not agree with the DSA.  The Court said a benefit vests when the employee begins working under the terms of the contract. Future employees cannot claim a vested benefit until they begin working. Thus, the Legislature could alter the pension benefits for new members.
The Court of Appeal also found an impairment of the contributions under the contract. PEPRA's contributions provisions cannot conflict with current contract terms. PEPRA as applied here would change the terms of the agreement.  Therefore, PEPRA would not apply until the agreement expired on June 26, 2014.

Thursday, February 5, 2015

Supreme Court Addresses Private Sector Vested Rights

On Monday the Supreme Court struck a blow to vested health-care benefit rights under collective-bargaining agreements in the private sector. Previously, courts assumed health-care benefits in a collective-bargaining agreement vested for life absent language to the contrary. This case changes that presumption. Now, health care benefits will not vest for life unless clearly stated in the collective-bargaining agreement. 

The issue in M&G Polymers USA, LLC v. Tackett is how health-care benefits vest under a collective-bargaining agreement. The Court of Appeals for the Sixth Circuit said health-care benefits are vested unless the collective-bargaining agreement say they are not. This presumption protects the vested benefit right.

The Supreme Court reversed that presumption. The Court said the presumption had no basis in contract law. Thus, when a contract is silent as to the duration of benefits, a court may not infer that the parties intended for those benefits to vest for life. The Court did not reinterpret the contract.  Instead, it asked the Sixth Circuit to review the case under “ordinary principals of contract law.”

This opinion does not reflect California law in the public sector. Article 1, Section 9 of the California Constitution prohibits the legislature from passing a law which impairs the obligation of contracts. The California Supreme Court has clearly stated that once a public employee accepts employment and works for an employer, the employee’s rights are protected by the Contract Clause. (White v. Davis (2003) 30 Cal.4th 528, 566.) Among these protected rights are vested pension rights. (Betts v. Board of Administration of Public Employees’ Retirement System, (1978) 21 Cal.3d 859, 863.)

Additionally, this ruling does not change the presumption in California that a public employee’s right to health benefits may be based on the implied terms of a collective bargaining agreement. (Retired Employees Association of Orange County, Inc. v. County of Orange (2011) 52 Cal.4th 1171.) However, an implied right to health-care benefits will only be inferred if there is a clear basis in the contract or convincing extrinsic evidence supporting the vested right.