In City of Palo Alto v. Public Employment Relations Board, the Court of Appeal held binding interest arbitration is a mandatory subject of bargaining under Government Code section 3507. As a result, the Court found the City violated the Meyers-Milias-Brown Act when it pushed through a local initiative to repeal binding interest arbitration while refusing to bargain with Palo Alto Firefighters, IAFF Local 1319. The Court upheld PERB's factual determinations and rejected the City's arguments. The Court also directed PERB to issue a new remedial order to correct a technical issue.
Palo Alto adopted binding interest arbitration by charter amendment for public safety officers in 1978. The charter required that a neutral arbitrator would decide disputes about wages, hours, and other terms and conditions of employment if the City and the unions reach impasse in contract negotiations. In 2011, the City tried to take binding arbitration away so that it could unilaterally impose terms on the firefighters.
At the time, the City claimed it did not have to meet and consult with the union about the change and ignored repeated demands to bargain. The City claimed an earlier case about binding arbitration under MMBA section 3505 meant it did not have to bargain with the union.
But the Court rejected the City's claims. The Court decided PERB properly decided that "mandatory subjects for consultation under section 3507 are distinct from mandatory subjects of meeting and conferring under sections 3504 and 3505." As a result, the Court held, the City had a duty to bargain with Local 1319 under 3507 even though it did not under 3505.
The Court also rejected the City's claim that bargaining under section 3507 is substantially different than bargaining under section 3505. In its briefs, the City claimed that a "meet and consult" under section 3507 was much less robust than a "meet and confer" under section 3505. But the Court disagreed, deferring to PERB's determination that the two processes were very similiar, if not identical. Since the City failed to even meet with the union, the Court held the City clearly violated its duty.
The Court also directed PERB to correct its remedial order. In its decision, PERB ordered the City to rescind a resolution floating the ordinance. But the Court noted PERB cannot order a City to rescind a resolution, but it can declare that a resolution is void. As a result, the Court directed PERB to issue a new order. Accordingly, the case will go back to PERB for a further order remedying the City's violations of the MMBA.
Mastagni Holstedt attorneys David E. Mastagni, Issac S. Stevens, and Jeffrey R. A. Edwards represented Local 1319 in the appeal. Mr. Edwards represented Local 1319 in oral argument.