Teamsters Union Local 340 v. City of Augusta, MLRB No. 93-28 (Alternate Chair Chute dissenting in part, Jan. 13, 1994), aff'd, Nos. CV-94-38 & -49 (Me. Super. Ct., Ken. Cty., May 10, 1994) STATE OF MAINE MAINE LABOR RELATIONS BOARD Case No. 93-28 Issued: January 13, 1994 _______________________________ ) TEAMSTERS UNION LOCAL 340, ) ) Complainant, ) ) v. ) DECISION AND ORDER ) CITY OF AUGUSTA, ) ) Respondent. ) _______________________________) On March 22, 1993, Teamsters Union Local 340 ("Teamsters" filed a prohibited practice complaint with the Maine Labor Relations Board ("Board") alleging various violations of the Municipal Public Employees Labor Relations Law ("MPELRL") by the City of Augusta ("City"). The complaint was amended after the Teamsters received a notice of insufficiencies from the executive director (for lack of specificity and failure to cite subsections of MPELRL section 964 allegedly violated). The complaint was amended again pursuant to an order of the prehearing officer regarding remaining insufficiencies. The amended complaint alleges that the City violated section 964(1)(E) of the MPELRL, 26 M.R.S.A. 964(1)(E) (1988), by 1) its refusal to meet at reasonable times for negotiations, in violation of section 965(1)(A) and the parties' contract; 2) its failure to pay 100 percent of health insurance premiums after contract expiration (when insurance premiums increased); 3) its deduction of the premium increase through payroll deduction three months before the increase was due to be paid; and 4) its failure to honor the parties' grievance procedure in connection with a grievance filed regarding the health insurance dispute. The City denies the allegations and further responds that 1) the complaint fails to state a cause of action; 2) the Board lacks jurisdiction -1- over the subject matter of the complaint; and 3) the complainant has failed to exhaust its contractual and administrative remedies prior to filing its prohibited practice complaint. On May 4, 1993, Board Chair Peter T. Dawson convened the prehearing conference in this matter. His Prehearing Memorandum and Order, dated May 12, 1993, is incorporated in and made a part of this decision and order. An evidentiary hearing was held on June 16, 1993. Alternate Chair Pamela D. Chute presided over the hearing, accompanied by Employer Representative Howard Reiche, Jr., and Employee Repre- sentative George W. Lambertson. Mr. James E. Carson represented the Teamsters, and Charles E. Moreshead, Esq., represented the City. The parties were given full opportunity to examine and cross-examine witnesses, introduce documentary evidence, and make oral argument. Briefs were filed by both parties; only the City filed a reply brief, which was received on October 20, 1993. Due to its heavy schedule and an illness, the Board was unable to deliberate this matter until December 17, 1993. JURISDICTION Teamsters Union Local 340 is the bargaining agent, within the meaning of 26 M.R.S.A. 962(2) (1988), for employees in the Augusta Police Bureau Patrolmen's Unit. The City of Augusta is the public employer, within the meaning of 26 M.R.S.A. 962(7) (Supp. 1993), of the employees in that unit. The jurisdiction of the Board to hear this case and to render a decision and order lies in 26 M.R.S.A. 968(5)(A)-(C) (1988). FINDINGS OF FACT Upon review of the entire record, the Board finds: 1. In June of 1990, the Teamsters and the City entered into a successor collective bargaining agreement effective from December 1, 1989, through December 31, 1992 ("89-92 agreement"). -2- 2. The parties have begun negotiations for another successor agreement. Unlike negotiation teams under the previous city manager, the City's negotiating team for the new patrolmen's contract now includes members of City Council, some of whom are employed during the regular work day. Successor negotiations began in November of 1992; the first meeting was scheduled by the City, and was held sometime after 4:00 p.m. The second meeting was also scheduled by the City for after 4:00 p.m. At one of those two meetings, the Teamsters objected to scheduling further negotiation sessions after 4:00 p.m., for the convenience of City Council members, on the basis of Article 11, section 5(1). That provision reads as follows: ARTICLE 11 GRIEVANCE PROCEDURE Section 5: General Considerations. 1. All grievance discussions, meetings, conferences, hearings, shall be conducted during the normal work day. After the City made proposals at the second session for extensive changes in the contract, the Teamsters requested mediation. Meetings with the mediator have all begun at 1:00 p.m.; some have extended beyond 4:00 p.m. 3. When the issue of meeting times for negotiations arose, the Teamsters asked the city manager, Mr. St. Peter, to contact the prior assistant city manager, who had negotiated the 89-92 agreement, regarding the meaning of Article 11, section 5(1). Mr. St. Peter did not do so. 4. The parties' 88-89 agreement contained a provision identical to section 5(1) of Article 11 of the 89-92 agreement. The provision was proposed by Dan Fitzpatrick, the previous city manager, because of his desire to hold contract negotiations, as -3- well as grievance meetings and other meetings related to union business, during the regular work day. Mr. Fitzpatrick did not want to work after 5:00 p.m., and also did not want the City Council involved in contract negotiations. At the request of the city manager, the parties' negotiation ground rules for the 88-89 agreement also included an agreement not to meet after 5:00 p.m. 5. The 89-92 agreement contains the following provisions: ARTICLE 5 MAINTENANCE OF STANDARDS It is mutually agreed that existing rights, privileges, or benefits affecting the Augusta Police Bureau and its members shall remain in force throughout the duration of this AGREEMENT. The Director of Public Safety shall have the right to delete, change, or implement rules and regulations. Any changes shall be posted prominently for a period of ten (10) working days whenever possible before becoming effective. Any disagreements resulting from this Article will be handled in accordance with the existing procedure. ARTICLE 11 GRIEVANCE PROCEDURE Section 1: Declaration of Policy. It is the purpose of this procedure to secure at the lowest possible administrative level, equitable solutions to grievances free from coercion, restraint, reprisal. Section 2: Definitions. a. Employee shall mean any person covered by this agreement as provided for under Article I - Recognition. b. Employer shall mean the individual designated by management to review and resolve grievances. c. UNION shall mean Teamster's (sic) Local 340 d. Grievance shall mean any claimed violation, misinterpretation or inequitable application -4- of this agreement or of any laws, rules, procedures, regulations, administrative order or work rules of the employer, or those matters affecting employees' health or safety, physical facilities, materials or equipment furnished to the employees or supervision of employees. e. Supervisor shall mean the employee on the next higher level of authority above the employee in the department wherein the grievance exists and who normally assigns and supervises the employee's work. f. Days shall mean all days other than Saturday, Sunday, and holidays which shall be excluded in computing the number of days within which action must be taken or notice given within the terms of this procedure. g. The grievance shall consist of a written statement served upon the CITY or the UNION as the case may be, by registered or certi- fied mail or by personal service. The grievance must: (a) cite the contractual provision in issue; (b) contain a statement of the claimed violation which is in dispute; and (c) set forth a statement of the re- quested relief. No grievance shall be permitted to be initiated more than fifteen (15) days after the date upon which the acts underlying the grievance arose; provided that such limitation shall not apply to payment of salary or benefits. Section 3: Rights of the Parties. a. Rights of Grievant 1. The grievant may select any representative(s) to assist him in the processing and/or preparing of grievances, except that no representative may be present from any other employee organization other than union. 2. The grievant shall have access to all written statements, records, and materials relating to the grievance. -5- b. Rights of the Union 1. The UNION shall receive a copy of any claim, including supporting materials and of any decision rendered pursuant to the grievance as outlined in Section 4, Step 1. 2. The UNION shall have the right to submit briefs to support or refute allegations of any party in a grievance. 3. The employee may have a union representative at any hearing, conference, meeting held under this procedure, if so requested. c. Mutual Rights In the event of the unexcused failure on the part of any aggrieved party to be timely, the grievance shall be deemed to be withdrawn. If the employer or his representative fail to make a decision within the required time period, the grievance shall be deemed to be upheld and in all respects final and binding upon the parties. Section 4: Presentation. Step One 1. An employee(s) who claims to have a grievance shall present this grievance to the Deputy Police Chief in writing within fifteen (15) calendar days of its occurrence. 2. The Deputy Police Chief shall meet with the parties to resolve the grievance within three days. After the request for the meeting, he shall render a decision in writing within five (5) days thereafter, a copy of which is sent to both the employee(s) and his representative. Step Two The aggrieved party, if not satisfied with the decision at Step One, may within ten (10) days request a review by the department head. Such request is to be in writing with a copy to the immediate supervisor. The department head shall convene a hearing within ten (10) days after receipt of the request for said hearing. The department head shall render a decision in writing, within ten (10) days after the hearing, -6- copies to the aggrieved and his representative. Step Three The aggrieved party, if not satisfied with the decision at Step Two, may within five days request in writing a hearing before the City Manager. The requested hearing shall be held within ten days after it is received and a decision shall be made within ten days thereafter, copies of the decision to the aggrieved party and his representative. Step Four The aggrieved party with the approval of the UNION may appeal an unsatisfactory decision at Step Three to an arbitrator selected by the UNION and employer. The decision arrived at shall be final and binding upon both parties to the agreement. If the parties fail to select an arbitrator, they shall use the Maine Board of Arbitration and Concili- ation Service tripartite. The fees and expenses of the arbitrator shall be borne equally by the parties. The arbitrator should hold a hearing within twenty (20) days after he has been selected and shall render a decision within twenty (20) days after the hearing has been concluded. The arbitrator shall have no power to add to, subtract from or change any other provision of this agreement, nor to render any decision which conflicts with a law. Section 5: General Considerations. 1. All grievance discussions, meetings, conferences, hearings, shall be conducted during the normal work day. 2. The time limits at any step(s) may be extended by written mutual consent of the parties. 3. The move to arbitration must be approved by the UNION. -7- ARTICLE 22 HEALTH INSURANCE BENEFITS The City will contribute towards Northern New England Benefit Health Trust for hospital, dental and eye care insurance for each employee according to the following schedule: December 1, 1989 - 240 per month December 1, 1990 - 266 per month December 1, 1991 - 292 per month The remainder, if any, will be paid by each employee using weekly payroll deductions. When a police officer retires with minimum twenty (20) years of service in good standing, the CITY will pay 100% of employee hospital insurance benefits until such time as accepted for medicare coverage. Dependent coverage may be picked up at group rate at employees (sic) full cost. 6. The contract covering the supervisors in the Augusta Police Department, a three-year contract which expires at the end of 1993, provides for Blue Cross/Blue Shield insurance, 100 percent of the premium to be paid by the City for all employees who were in the unit at the time the contract went into effect. Anyone promoted to supervisor during the contract term brings with him/her whatever insurance benefits he/she had previously. The City has also been paying 100 percent of the Blue Cross/Blue Shield premium for the dispatchers' unit. Other City employees are covered by Blue Cross/Blue Shield as well. 7. Article 22 of the parties' 88-89 agreement reads as follows:1 HOSPITAL INSURANCE BENEFITS The CITY will provide for those individuals employed as of the signing of the 1985-87 AGREEMENT, at _________________________ 1Apparently, this or a similar provision appeared in the parties' 1985-87 agreement, and they failed to change the dates when carrying it over to the 88-89 agreement. -8- no cost to said employees, hospital insurance benefits for which the employee is qualified. Effective upon signing the 1985-87 AGREEMENT, the CITY will pay $8.70 per week for the Teamsters Northern New England Benefit Trust plan for dental, eye care and prescription insur- ance; effective January 1, 1986, the CITY shall pay $9.70 per week and effective January 1, 1987, the CITY shall pay $10.70 per week for said insurance coverage. Effective upon the signing of the 1985-87 AGREEMENT, all new employees hired thereafter shall receive insurance benefits for which the CITY will pay up to $43.85 per week, said amount to be used toward hospital insurance and the Teamsters benefit plan for dental eye care and prescription insurance. Employees shall pay any additional costs for such insurances. The intent is to find a comparable plan which will provide the same benefits at a lower cost to the CITY. If the CITY finds a comparable plan at a lower cost, the CITY's only obligation will be to fund the cost of the comparable plan. When a police officer retires with minimum twenty (20) years of service in good standing, the CITY will pay 100% of employee hospital insurance benefits until such time as accepted for medicare coverage. Dependent coverage may be picked up at group rate at employees (sic) full cost. The premium cap for new employees was never enforced. 8. The health insurance provided under the 88-89 agreement was a Blue Cross/Blue Shield health plan. The decision to move to another health plan stemmed from the City's desire to reduce its health care costs, and the Teamsters' desire that unit members not be required to begin sharing the cost of premiums. 9. Unlike blue Cross/Blue Shield, the Northern New England Benefit Health Trust is a defined contribution plan rather than a defined benefit plan. As a result, the Trust was able to provide guaranteed premium amounts to the Teamsters for each of the three years of the contract. For those three years, premiums were $240, $266 and $292, rather than $266, $292 and $402.25, because the parties made their contract retroactive to December 1, 1989, -9- rather than to January 1, 1990. The parties were aware, when they entered into the 89-92 agreement, that insurance premiums would be increasing to $402.25 as of January 1, 1993. 10. Specific dollar figures for the City's insurance premium contribution (and the statement that employees would pay the remainder, if any) were placed in the 89-92 agreement because the City did not want to be responsible for any premium increase that might occur during the term of the contract. (The City was not convinced that premiums would not increase during the con- tract term, in spite of the Trust's guarantee to the Teamsters.) The Teamsters recommended that members ratify the 89-92 agreement in part because there would be no cost sharing on health insur- ance premiums during the life of the contract. During the contract term, premiums did not increase (although benefits were reduced). 11. By letter dated December 30, 1992, Northern New England Benefit Trust notified the City that effective January 1, 1993, through December 31, 1993, the monthly premium for the insurance package for the patrolmen's unit would increase to $402.25 per member. 12. By memorandum dated January 6, 1993, and prepared by the city manager and the personnel director, the City notified members of the unit of the premium increase and of the City's intention to deduct the increase from employees' paychecks pursuant to Article 22 of the 89-92 agreement. 13. By letter dated January 8, 1993, Northern New England Benefit Trust informed the City and the Teamsters as follows: Recognizing that contract negotiations are in progress and, given the fact that the collective bargaining agreement expired but a few days ago, ie, December 31, 1992, the Trust is willing to await payment of the -10- required additional contributions amount due beginning January 1, 1993, if necessary, until March 31, 1993. It must be understood by both parties to the collective bargaining agreement, that the retroactive amount is expected to be paid once the agreement is settled. However, no further extension of coverage is available after midnight March 31, 1993, except as full payment of the accumulated additional contributions has been made at this office on or before that date. If you have any questions regarding this matter please feel free to contact me at the Fund office. The same information was conveyed to the city manager in a phone conversation with an official of Northern New England Benefit Trust. 14. By letter dated January 12, 1993, James Carson of the Teamsters contacted City Manager Terrence St. Peter regarding, among other things, the payroll deduction. The letter stated: I am writing to you pursuant to our telephone conversation of yesterday January 7, 1993 regarding our contract negotiations with particular reference to the issue of health insurance premiums and coverage under the current Northern New England Benefit Trust carrier. As you know the fund (NNEBT) has notified our respective parties by phone that they are willing to allow the parties to wait until March 31, 1993 to submit the difference between the $292.00 the City is now paying to provide the 100% benefit without employee contributions and the $402.25 which has become the new premium effective 1/1/93 that would represent 100% of premium. Given that grace period it is not necessary for you to payroll deduct the difference between the $292.00 and the $402.25 from the employees (sic) checks. In order to maintain the status quo both parties should make plans on their own to set aside funds that will be available to make retroactive payments of the difference between the two figures which amounts to about $27.00 per week per employee. -11- I also told you that the Union considers your payroll deduction of these monies from the employees (sic) paychecks to be a prohibited practice in keeping with the Municipal Public Employees Labor Relations Law Section 965.C which requires you to confer and negoti- ate in good faith with respect to wages, hours, working conditions and contract grievance arbitration. Medical insurance coverage and premiums are considered manda- tory subjects of bargaining and as such the employer cannot unilaterally implement changes without negoti- ations with the Union over such subjects, unless and until the parties have reached contract impasse. In addition to that I also told you that the Union will be filing a second prohibited practice complaint under Section 965.A that requires the parties to bargain collectively and to meet at reasonable times. With respect to this complaint I explained to you that the clause contained within Article 11, Section 5, (1) requires the parties to meet for all grievance discus- sions, and that all meetings, conferences and hearings will be conducted during the normal work day. I explained to you that I had been told that this clause was inserted into the contract by the former City Manager to specifically provide that contract negoti- ations be conducted during normal business hours. Had you complied with the contract we may have been able to reach agreement on the question of insurance benefits and premiums which would have averted your questionable need to payroll deduct any monies from anyone, or at least to do so in a lawful way after having bargained with the Union. I further told you during our conversations that Article 5, of the collective bargaining agreement between our parties titled "Maintenance of Standards", requires the employer to keep in effect during the life of the agreement all rights, privileges or benefits affecting the Augusta Police Bureau and its members, and such rights, privileges and benefits are to remain in force. Thus, in order to maintain the benefits provided under Article 22 of the contract, "Health Insurance Benefits", it will be necessary for the employer to provide the full premium required by the Trust in order to keep the insurance in force beyond January 1, 1993. Failure to do so would put you in violation of your commitment under Article 5. In addition I told you that if the City felt aggrieved by the fact that they were being required to -12- pay the difference between the $292.00 premium and the $402.25 premium, that you as the employer have access to the grievance procedure contained within Article 11 of the collective bargaining agreement Section 2.G, namely, that a grievance shall consist of a written statement served upon the City or the Union as the case may be. Therefore should you feel that your payment of 100% of the insurance premiums is a violation of the collective bargaining agreement you are compelled to file a grievance and arbitrate the issue of who is wrong and who is right. With respect to this dispute, and the loser will be bound by the decision of the arbitration panel until a new agreement can be reached that resolves the issue of 100% payment of the insurance premiums. By way of this letter, I am notifying you that the Union is requesting collective bargaining for the pur- pose of reaching a new collective bargaining agreement to replace the agreement that expired on December 31, 1992 and demanding impact bargaining on the question of health insurance benefits owing to the fact that my membership would suffer adverse harm due to your refusal to pay the newly required premium of $402.25 effective 1/1/93 to the NNEBT. I am offering you the following dates to continue negotiations, that were started in December prior to your raising the issue of evening meetings; January 20, 1993, January 22, 1993, January 25, 1993 and January 28, 1993. Please notify us as to which days you may be available to meet during the "normal work day". 15. Attached to the January 12th letter was the following one-page document: -13- TRUCK DRIVERS, WAREHOUSEMEN & HELPERS LOCAL UNION #340 GRIEVANCE REPORT CAREFULLY EXPLAIN THE FACTS, TIME & DATE. TURN OVER TO STEWARD OR UNION. DATE: 1/11/93 EMPLOYER: City of Augusta The employer by authorizing payroll deductions from the employees (sic) paychecks to cover a pending increase in health insurance premiums is in violation of Article 5 - Maintenance of Standards, Article 11 Grievance Procedure, Article 16 - Wages and Article 22 - Health Insurance Benefits. SIGNED: STEWARD'S OR AGENT'S REPORT: SIGNED: SIGNED: [signed by James E. Carson] BUSINESS AGENT, LOCAL 340 SHOP STEWARD The letter and the grievance report were sent by certified mail, and were received by the City on January 14th. The grievance was not presented to the deputy chief or chief before it was presented to the city manager. 16. Upon receipt of Mr. Carson's January 12th letter, the City did not cease deducting the insurance premium increase from employees' paychecks. The Teamsters' letter regarding setting aside the money notwithstanding, the City was concerned, based on a similar situation reported in the newspaper of a nearby community, that the retroactive premium increase due March 31, 1993, would not be paid and that employees' health insurance -14- would be terminated. 17. The city manager took the grievance report that he received on January 14th as a grievance, and directed the personnel manager to set up a "meeting or hearing" regarding Mr. Carson's January 12th submission. The city manager did not reject the grievance outright for failure to follow the contractual grievance procedure, because he thought to do so would be "unfair or improper or not looking to deal in good faith." 18. On January 20, 1993, the personnel director called Mr. Carson's office to set up a negotiation session for January 28th. The personnel director did not talk directly to Mr. Carson, because he was not available. In his conversation with office personnel, the personnel director mentioned the possibility of a meeting prior to negotiations for the purpose of discussing Mr. Carson's January 12th letter. 19. On that same date the personnel director sent Mr. Carson the following letter: This letter is to inform you that I have scheduled a contract negotiation session for the Police Unit on January 28, 1993, at 4 p.m. in Conference Room A of the City Center. Please let me know if the date and time are convenient for you. 20. One or two days before the negotiation session set for January 28, 1993 (which eventually was cancelled by the Teamsters), the personnel director mentioned to the shop steward, a member of the negotiating team, that the City would be willing to hold a meeting on the Teamsters' health insurance grievance before the negotiation session, at 3:00 p.m. on January 28th. The shop steward had not filed the grievance, had not asked for a -15- grievance meeting, and has no general responsibility for setting up grievance meetings. He did not contact the Teamsters about the personnel director's comment. 21. Mr. Carson sent City Manager St. Peter a letter on February 10, 1993, stating: The enclosed grievance was forwarded to you on the 12th of January, 1993 by certified mail. As you can see by the enclosed mail receipts the package was received by the city on January 14th, 1993, signed for by city employee Ken Austin. A quick check of the calendar reveals that it has been seventeen (17) working days since the City signed for and received this grievance from the Union. Article 11, Section 3, C of the expired collective bargaining agreement between the parties states: "if the employer or his representative fail to make a decision within the required time period, the grievance shall be deemed to be upheld and in all respects final and binding upon the parties". As the grievance states, the employer is to cease and desist from deducting monies from employee's (sic) paychecks to cover a pending increase in employee health insurance premiums. Such premiums are to be paid by the employer in keeping with the parties (sic) intentions in the 1989 to 1992 collective bargaining agreement. The figures stated in that collective bargaining agreement reflect an employer agreement and a Union promise that the numbers indicated represent 100% of the required premium under that particular health and welfare policy. 22. On February 12, 1993, Mr. St. Peter sent the following letter to Mr. Carson: Although it was not clear in your January 12 letter, for reasons which I will explain later in this letter, that you were filing a grievance, we did in fact respond to you to set up a hearing in case you really thought you were filing a grievance. -16- That meeting time, communicated to both your office and Steward Michael Toman by Personnel Director David Jowdry, was offered to be a 3 p.m., January 28, preceding a negotiation meeting which we offered to be scheduled at 4 p.m. that day. You never confirmed either session but did, as January 28 approached, cancel the session. If indeed this was a grievance request, as your "Grievance Report" would imply but your letter contradicts, then a hearing with the City Manager would be in order (assuming the first two steps under the contract had been complied with, which apparently has not been done). Not knowing whether the first two grievance steps had been followed or not, we proceeded to attempt to have a hearing on the matter with you nonetheless. You apparently were unable to meet the schedule or, to this point, give us an acceptable alternative time. Nowhere in your letter or attached "Grievance Report," both of which are attached to this corres- pondence, do you state you want a hearing or whether you are filing a grievance. Your letter states that the "Union considers your payroll deduction of these monies from the employees (sic) paychecks to be a prohibited practice in keeping with the Municipal Public Employees Labor Relations Law Section 965.C ..." You further stated, in the next paragraph, "In addition to that I also told you that the Union will be filing a second prohibited practice complaint under Section 965.A that requires the parties to bargain collectively ..." I inferred from these two paragraphs that you were filing prohibited practices complaints to the Labor Relations Board, which of course you are free to do. However, the situation became further muddied in the second page of your letter. There, you stated, "In addition I told you that if the City felt aggrieved by the fact that they were being required to pay the difference between the $292.00 premium and the $402.25 premium, that you as the employer have access to the grievance procedure contained with Article 11 of the collective bargaining agreement Section 2.G, namely, that a grievance shall consist of a written statement served upon the City or the Union as the case may be (your emphasis). Therefore should you feel that your payment of 100% of the insurance premiums is a viola- tion of the collective bargaining agreement you are compelled to file a grievance and arbitrate the issue -17- of who is wrong and who is right." Were you saying the City should file a grievance? If so, do I conclude that the Union was not filing a grievance? Later on, you added, "By way of this letter, I am notifying you that the Union is requesting collective bargaining for the purpose of reaching a new collective bargaining agreement to replace the agreement that expired on December 31, 1992 and demanding impact bargaining on the question of health insurance benefits owing to the fact that my membership could suffer adverse harm due to your refusal ..." Were you filing a grievance, informing me that you were going to submit a prohibited practices complaint, asking the City to file a grievance, or "demanding impact bargaining?" The only thing your letter says you were notifying me of was the request for collective bargaining. We responded to you with a date on that as well. On January 6, we notified the membership as a courtesy, of the City's need, under the terms of the contract, to begin payroll deductions for health insurance. We need not repeat the very clear reasons here; a copy of the January 6 letter is enclosed. The position of the City is, therefore, very clear. If you believe you want to file a grievance, then we of course will have a hearing. That hearing will ascertain whether the proper steps in the grievance process have been followed as well as the merits of the issue. Please contact me if you wish to pursue this avenue. If you believe you have a legitimate complaint, you may wish to file a prohibited practices complaint with the Labor Board. We will, of course, comply with any rulings from the MLRB. The most practical solution to this question however, is for us to bargain for a new contract to replace the one that expired December 31, 1992. As we have stated to you before, we are ready to meet with you any day from 4 p.m. on to negotiate a new contract. Please contact David Jowdry to establish a mutually convenient day. -18- So that there is no confusion, let me state very directly that this letter is in response to your February 10 letter. The City sees no reason to change its understanding of the very clear wording of the contract unless, or until, a new contract is agreed upon. Therefore, the deductions for health insurance premiums will continue. 23. There has never been a waiver of the time limits established in Article 11, except by mutual agreement. 24. The parties have stipulated that in addition to individual employees, the Teamsters and the City may both file grievances under the grievance procedure. 25. On another occasion, when the Teamsters filed a grievance on behalf of all unit members, both the deputy chief and chief (at the first two steps of the grievance procedure) wrote on the grievance "Unable to handle at my level," and passed it on to the next level. DISCUSSION Jurisdiction/exhaustion At hearing, the City moved for dismissal of the complaint on the grounds that the Board lacked jurisdiction to hear the complaint and that the Teamsters had failed to exhaust its contractual grievance remedies. The Board denied the motion and proceeded to hear the matter. The reasons for the denial will be outlined briefly. In both its original response to the complaint, filed prior to the prehearing conference, and in its response to the complaint as finally amended, after the prehearing conference, the City asserted lack of subject matter jurisdiction and failure to exhaust as affirmative defenses. The defenses were based on the City's assertion that any interpretation of the parties' contract must be processed through the contractual grievance -19- procedure. The Board clearly has jurisdiction over unfair labor practice charges, including a charge of failure to bargain. That is so even where the charge is based on an alleged contract violation -- in such an instance, the Board must interpret the contract in order to determine whether a failure to bargain has occurred. State v. MSEA, 499 A.2d 1228, 1230 (Me. 1985). Of course, it is within the Board's discretion to defer to grievance arbitration machinery, and it will do so in certain circumstances. Here, however, deferral would be inappropriate for two reasons. First, the Board's rules require that any request for deferral be made in the response to the complaint and that oral argument on the request be made at the prehearing conference. Rules 4.05(A) and 4.07(A). The City did neither -- rather it simply (and inaccurately) asserted lack of jurisdic- tion and failure to exhaust. The Board will not normally defer, even where deferral would otherwise be appropriate, where a specific request for deferral is not made.2 More important, even if the Board were to have taken the City's defenses as a request to defer, we would not defer in this case. None of the allegations in the complaint involve purely a matter of contract interpretation. There are two allegations regarding meeting times -- that the City's refusal to hold negotiation meetings before 4:00 p.m. violates the section 965(1)(A)) requirement to meet at reasonable times (which is not arbitrable), and that it violates the parties' contract (which is arbitrable, at least until the contract expires). In connection _________________________ 2Or if made, was untimely. The purpose of Rules 4.05(A) and 4.07(A) is to ensure that deferral decisions are made before the Board and the parties spend time and money preparing for the evidentiary hearing. -20- with post-expiration status quo allegations, which types of contract provisions "survive" expiration, as well as how the status quo is defined, are decisions for the Board even though contract interpretation may also be involved. Finally, even the City has acknowledged that the alleged default on a grievance already filed (in connection with the health insurance dispute) is appropriately before the Board. In these circumstances, where the issues are intertwined and where some (or in this case, most) issues cannot be arbitrated, deferral to the parties' grievance procedure would serve no useful purpose.3 Refusal to meet at reasonable times When negotiations for a successor agreement began in November of 1992, meeting times for the first two meetings were set by the City -- both meetings were held after 4:00 p.m., at the City's insistence. Thereafter, the parties met with a mediator, who set the meeting times. The Teamsters allege that the City's insistence that face- to-face negotiations occur after 4:00 p.m. violated both the contract itself and the requirement of section 965(1)(A) that parties meet at reasonable times. We disagree. Article 11, section 5 of the parties' expired contract states: _________________________ 3Bureau of Employee Relations v. AFSCME, 614 A.2d 74 (Me. 1992), cited by the City, is inapplicable to this case, since the parties' contract contains no zipper clause that would impact the Board's authority to determine whether a mid-term contract violation has occurred. Furthermore, most of the allegations concern events that occurred after the contract expired, and zipper clauses by their very nature do not generally survive contract expiration. Consequently, they can have no impact on the Board's authority to make post-expiration status quo determinations. -21- ARTICLE 11 GRIEVANCE PROCEDURE Section 5: General Considerations. 1. All grievance discussions, meetings, conferences, hearings, shall be conducted during the normal work day. 2. The time limits at any step(s) may be extended by written mutual consent of the parties. 3. The move to arbitration must be approved by the UNION. The Teamsters argue that the language in subsection 1, which also appeared in the parties' 88-89 contract at the request of the previous city manager, was intended to include contract negoti- ations and not just grievance-related contacts between the parties. The City argues that although the previous city manager may have intended that the provision address contract negotia- tions, by its own terms it does not. Where a contract provision is vague or ambiguous, it is appropriate to consider extrinsic evidence regarding the intent of the parties when the provision was drafted. Absent extra- ordinary circumstances, we are not willing to do so where the contract language is clear on its face,4 especially where the subject at issue is how the parties will conduct negotiations for a new contract (in essence, a ground rule for future negoti- ations). Section 5 appears in the grievance article of the contract. Furthermore, subsection (1), relied on by the Teamsters, refers to grievance discussions, meetings, conferences and hearings, and the other two subsections clearly relate only to grievances. There is simply no ambiguity to resolve. _________________________ 4One such circumstance might be a clearly established past practice that contradicts a contract provision. -22- We also reject the Teamsters' alternative contention that the City violated section 965(1)(A) -- the requirement that parties meet at reasonable times. There was no evidence that the City insisted on meeting after 4 p.m. in order to delay or avoid negotiations -- members of City Council wished to participate on the City's bargaining team, and the meeting time was meant to accommodate other employment. It appears from the record that the City was intransigent about the meeting time for face-to-face negotiations, but the Teamsters were no better -- their bargain- ing team members wanted to meet only before 4 p.m.5, and neither side offered a compromise suggestion. In these circumstances, we decline to find that the City acted unreasonably. However, we strongly suggest that in the future both parties make an effort to find common ground, in order that the legitimate interests of both parties are accommodated to the extent possible. Failure to maintain the status quo for insurance premiums The Teamsters allege that by failing to continue to pay 100 percent of health insurance premiums after expiration of the parties' contract, the City has failed to maintain the status quo, in violation of the duty to bargain. The situation before us is analogous in relevant respects to the facts in Auburn School Support Personnel v. Auburn School Committee, No. 91-12 (M.L.R.B. July 11, 1991). There, the health insurance provision in the parties' three-year contract contained a fixed dollar amount to be paid by the employer toward the insurance premium for the first year, with a reopener for the second and third years. The fixed dollar amount covered 100 percent of the premium for the first year, but not for the second and third, when premiums increased. The parties had not been able to reach agreement under the reopener provision. The Board _________________________ 5Also apparently for legitimate reasons related to employment or other responsibilities. -23- found that pursuant to its post-expiration status quo require- ment, the employer was required in the second and third years to continue what it been doing in the first year -- paying the fixed dollar amount in the contract.6 In the matter now before us, the parties' expired contract includes a health insurance provision that contains a fixed dollar amount to be paid by the employer for each of three years. Because the dollar amount covered 100 percent of the premium for each of those years, the Teamsters argue that paying 100 percent constitutes the status quo. Put another way, the Teamsters suggest that we look not at the fixed dollar amounts in the contract, but that we look at the "totality of the circum- stances." The circumstances to which the Teamsters point are as follows: 1) the City is paying 100 percent of premiums for the supervisors' and dispatchers' units and could not have intended to treat this unit differently; 2) the Teamsters proposed the switch from Blue Cross/Blue Shield to Northern New England Benefit Health Trust (the insurance plan in the expired contract) precisely in order to avoid cost sharing of premiums by unit members;7 3) the Teamsters provided the City with a windfall during the contract term by making it retroactive to December 1, _________________________ 6The post-expiration status quo requirement was applicable during the period of the contract, because the reopener date in essence operated as an "expiration date" for the first year of the health insurance provision. 7The parties began exploring alternatives to Blue Cross/Blue Shield when the City raised the issue of whether newly hired employees subject to the cost-sharing provisions of the 88-89 contract should retroactively pay increases that had occurred during the term of that contract. The City had not been enforcing the provision during the contract term. -24- 1989;8 4) there should be a different view of the status quo where the contract provides a defined contribution plan rather than a defined benefit plan;9 and 5) the "remainder" language in the contract was put in simply to satisfy the City's concern that premiums might go up during the term of the contract even though the Trust had guaranteed they wouldn't -- the Teamsters were not told by the City that the fixed dollar amount in the third year of the contract would be a post-expiration cap.10 While some of the Teamsters' arguments hold some appeal, the health insurance provision itself is determinative. That provision states, in part: The City will contribute towards Northern New England Benefit Health Trust for hospital, dental and eye care insurance for each employee according to the following schedule: December 1, 1989 - 240 per month December 1, 1990 - 266 per month December 1, 1991 - 292 per month The remainder, if any, will be paid by each employee using weekly payroll deductions. The "remainder" language in the provision is unequivocal. Accordingly, we see no way to consider the fixed dollar amounts in the contract as anything but a cap on the City's responsi- _________________________ 8By backdating the contract, the 1990 premium was at the Trust's 1989 rate, the 1991 premium was at the 1990 rate, and the 1992 premium was at the 1991 rate. 9The Trust plan is a defined contribution plan for which the Trust could guarantee the premium rates for three years. For defined benefit plans such as Blue Cross/Blue Shield, premium rates are unpredictable. 10They also suggest that the "remainder" language was put in because the Trust required it. No evidence was presented to support this contention. -25- bility for insurance premiums, even though those fixed dollar amounts covered 100 percent of the premium for each of the three years. The City did not violate the status quo when it refused to pay the premium increase upon expiration of the parties' contract. Premature deduction of premium through payroll deduction The Teamsters' third allegation is that the City violated its duty to bargain by prematurely deducting the premium increase from employees' paychecks. After the Trust informed the City that premiums would be increasing effective January 1, 1993, and the City notified employees that the increase would be deducted from paychecks pursuant to the contract, the Trust was apparently contacted by the Teamsters regarding an extension of time for contract negotiations. Shortly thereafter, the Trust informed the parties that an extension of time would be granted to March 31, 1993, pending contract negotiations over the increase, but that the full increase would eventually have to be paid retro- active to January 1st. The Teamsters then contacted the City by letter requesting that the payroll deductions not occur during the grace period, and offering to set aside funds to ensure that the retroactive payments would be made when due. (The Teamsters also suggested that the City do the same.) In spite of that request, the City did not cease deducting premiums from employees' paychecks. The City argues that the contract required the deductions in the absence of a meeting between the parties to agree on some other arrangement -- for instance, an escrow account to guarantee payment. According to the City, it was unable to set up such a meeting.11 The City also argues that it had a legitimate concern, _________________________ 11Testimony indicates that the City called the Teamsters office to arrange a meeting on Mr. Carson's January 12th letter that, among other things, requested a delay in the payroll deduction. The City was unable to reach Mr. Carson. -26- based on a similar situation in another town, that the retroactive increase would not be paid and that employees' health insurance would be cancelled. We reject the City's argument. The contract requires that the remainder, if any, be paid by employees through payroll deduction. Pursuant to the grace period granted by the Trust, the City was paying only the $292.00 per month per employee that it had agreed to pay in the contract. Once the requirement to pay the increase was suspended, the obligation itself was suspended (though not dissolved). From then until March 31st, there was no remainder to be paid by employees under the contract, and the City had no authority to withhold monies from employees' paychecks for that purpose.12 By doing so, the City violated the status quo, as reflected in Article 22 of the parties' expired contract, thereby violating section 964(1)(E) of the MPELRL, 26 M.R.S.A. 964(1)(E) (1988). We will order the City to cease and desist from making such premature payroll deductions in the future.13 Failure to honor the parties' grievance procedure The Teamsters' final allegation is that the City has failed to honor the parties' grievance procedure by failing to deny the Teamsters' insurance premium grievance, yet continuing to deduct the premium increase from employee paychecks. We agree. _________________________ 12The City's concern that the insurance would be cancelled seems unfounded, given the Teamsters' agreement to set aside funds for payment. In any case, once the premium increase became due and owing after March 31, 1993, and if the parties had not reached agreement on a new contract that required the City to pay the retroactive increase, the City would have had the authority to deduct the whole retroactive increase from employees' pay- checks. 13Normally, we would order the City to pay the employees interest for the period of approximately three months during which money was prematurely withheld. We will not do so here, since we are ordering it to pay interest for that time period in connection with a separate violation. -27- On January 14, 1993, the City received a one-page document attached to a letter addressed to the City manager. The document was labeled "GRIEVANCE REPORT" and, along with the letter, was sent by certified mail as required by the parties' contractual grievance procedure. The grievance alleged the following: The employer by authorizing payroll deductions from the employees (sic) paychecks to cover a pending increase in health insurance premiums is in violation of Article 5 - Maintenance of Standards, Article 11 Grievance Procedure, Article 16 - Wages and Article 22 - Health Insurance Benefits. At the city manager's direction, on January 20th the personnel manager attempted to contact Mr. Carson of the Teamsters by phone at his office in order to schedule a negotiation session for January 28th. He also mentioned to office personnel the possi- bility of a meeting prior to the negotiation session to discuss the January 12th letter and/or the grievance.14 The personnel director never spoke to Mr. Carson, and his letter to Mr. Carson on that same date did not mention either the January 12th letter or the attached grievance. One or two days before the negoti- ation session set for the 28th, the personnel director did mention to the shop steward that the City would be willing to meet before the negotiation session to discuss the grievance. However, the shop steward did not pass that information on to the Teamsters, since he had not filed the grievance, had not asked for a meeting, and has no general responsibility for setting up grievance meetings. On February 10th, twenty-seven days (eighteen working days) _________________________ 14Testimony was confusing on this point. The city manager testified that he and the personnel director discussed contacting Mr. Carson "to have a hearing or a meeting on the letter or the grievance." According to the personnel director, he did not mention the grievance itself when he made the call. -28- after the City had received the grievance, Mr. Carson sent the city manager a letter pointing out that the City had failed to act on the grievance within the time set out in the parties' grievance procedure. The grievance procedure states, in part: If the employer or his representative fail to make a decision within the required time period, the grievance shall be deemed to be upheld and in all respects final and binding upon the parties. (Emphasis added) Nevertheless, the City continued to deduct the insurance premium increase from employee paychecks. The City defends its failure to act on the grievance before the contractual deadline by pointing out that the Teamsters themselves failed to follow the grievance procedure: first by failing to utilize the first two steps of the procedure, and also by failing to request a hearing when filing the grievance at step three. The City also asserts that it made all reasonable attempts to address the January 14th submission from the Teamsters, and that the facts do not establish a pattern which would constitute a repudiation of the parties' grievance proce- dure. It is not clear that the Teamsters were required to ask for a hearing when the grievance was filed at step three -- the contractual procedure appears to us to contemplate hearings in response to a denial at the previous step. The City is correct that the grievance procedure does not explicitly provide that the union, when filing a grievance itself, may skip the first two steps. However, an arbitrator will not necessarily refuse to hear a grievance based on this defense where presentation of a grievance at the early step(s) in the procedure would be futile and therefore a waste of time. Bremen Community School District 228, 82 LA 829 (Nathan, 1984); Advance Window Cleaning Co., 43 LA 695 (Kates, 1964); Los Angeles County Probation Dept., 68 LA 1373 -29- (Rothschild, 1977).15 In the matter before us, the City may or may not have pre- vailed before an arbitrator, had it denied the grievance on either or both of these procedural grounds and submitted the dispute to arbitration. However, if an employer has objections to the procedure utilized by the union to file a grievance, those objections must be made in a timely manner or they are waived. Peabody Coal Co., 87 LA 1003 (Volz, 1986); Los Angeles County Probation Dept., 68 LA 1373 (Rothschild, 1977); Celluplastic Corp., 28 LA 659 (Callaghan, 1957); International Shoe Co., 20 LA 618 (Kelliher, 1953); Celanese Corp., 17 LA 187 (Jaffee, 1951). See also City of Westbrook v. Teamsters Local 48, 578 A.2d 716, 719 (Me. 1990). Not only did the City fail to deny the grievance on procedural grounds -- it failed to act on the grievance at all. This casual attitude toward the parties' grievance procedure is even more surprising in light of the City's position, in connection with its failure-to-exhaust argument, that the parties' grievance procedure should be the means through which allegations of contract violations are resolved. By failing to act on the Teamsters' grievance within seventeen working days from the date it was filed, and then refusing to abide by the default provision of the parties' grievance procedure [Article 11, section 3(c)], the City has _________________________ 15That is the case here; no resolution of the insurance increase grievance was possible at step one or two of the parties' grievance procedure. On a previous occasion when the Teamsters filed a grievance on behalf of all unit members, both the deputy chief and chief (at the first two steps of the grievance procedure) wrote on the grievance "Unable to handle at my level," and passed it on to the next level. -30- violated section 964(1)(E) of the MPELRL.16 Accordingly, we will order the City to cease and desist from the violation and to take the affirmative action of reimbursing employees for the insurance premium deduction that was the subject of the grievance.17 Since the issuance of this decision and order has been delayed by circumstances beyond the control of the parties (unusually heavy caseload and illness), we will limit the City's liability for the premium increase to the period from January 1, 1993, to December 1, 1993.18 Interest is to be computed in accordance with Florida Steel Corp., 231 NLRB 651 (1977), utilizing the interest rates specified in New Horizons for the Retarded, Inc., 283 NLRB 1173 (1987).19 Payment shall be made within 30 days of the date of issuance of this Order. _________________________ 16The City's argument that no pattern of grievance procedure repudiation has been established is without merit. Our finding that the City violated its duty to bargain is not based upon application of the totality-of-the-circumstances test, but upon violation of a contract provision that itself specifies what the remedy will be for failure to respond to a grievance in a timely manner. The Board is simply enforcing that contract provision. Nor are we persuaded by the City's assertion that it made all reasonable attempts to address the material it received from the Teamsters on January 12th (apparently by attempting to set up a meeting). We see no logic in the City's assumption that without a meeting or hearing, the grievance procedure was put on hold. If the City believed that the union was required to ask for a hearing, it should have denied the grievance and included the Teamsters' procedural error in the reasons for the denial. 17Although the City would have had the right, under the status quo rule, to deduct the increase, it effectively waived that right by failing to act on the Teamsters' grievance. 18The last brief was received on October 20, 1993. The case was not deliberated until December 17, 1993. 19Thus, interest is to accrue commencing with the last day of each calendar quarter of the time period subject to reimburse- ment, on the total amount then due and owing at the short-term Federal rate then in effect. From January 1 to December 1, 1993, the interest rate was 7 percent. Interest will begin reaccruing 30 days after the date of this Order, if by that date the City has not complied with the Order. -31- ORDER On the basis of the foregoing facts and discussion, and by virtue of and pursuant to the powers granted to the Maine Labor Relations Board by the provisions of 26 M.R.S.A. 968(5) (1988 & Supp. 1993) and the Board's Rules and Procedures, it is hereby ORDERED: 1. That the City of Augusta and its representatives and agents shall: a. Cease and desist from failing to bargain by deducting monies from employees' paychecks for an insurance premium obligation that has not yet matured. b. Cease and desist from failing to bargain by refusing to abide by the default provision in the parties' contractual grievance procedure. c. Take the following affirmative action that is nec- essary to effectuate the policies of the MPELRL: Reimburse members of the Augusta Police Bureau Patrolmen's Unit for the premium insurance increase deducted from paychecks for the period January 1, 1993, to December 1, 1993, plus interest. Payment shall be made within 30 days of the date of issuance of this Order. 2. That the remaining allegations in the complaint are dismissed. 3. That the City's request for costs and attorney's fees is denied. Issued at Augusta, Maine, this 13th day of January, 1994. MAINE LABOR RELATIONS BOARD /s/_________________________ Howard Reiche, Jr. Employer Representative /s/_________________________ George W. Lambertson Employee Representative The parties are hereby advised of their right, pursuant to -32- 26 M.R.S.A. 968(5)(F) (Supp. 1993), to seek review of this decision and order by the Superior Court. To initiate such a review an appealing party must file a complaint with the Superior Court within fifteen (15) days of the date of issuance of this decision and order, and otherwise comply with the requirements of Rule 80C of the Maine Rules of Civil Procedure. Alternate Chair Pamela D. Chute filed a separate opinion, dissenting in part. OPINION I cannot agree with my colleagues that the City violated section 964(1)(E) of the MPELRL when it refused to delay deducting the premium insurance increase from employee paychecks beginning in January of 1993. Although the Trust had given the parties a temporary reprieve on payment of the increase, the Trust made it absolutely clear that full payment would be due at the end of the grace period, retroactive to January 1, 1993. Thus, the debt was incurred in January, though not due and owing until April 1st. In these circumstances, I would find that in spite of the temporary reprieve on payment, there was immediately a "remainder" to be paid by employees under the terms of the health insurance provision of the expired contract, and that the City was authorized, under that provision, to deduct and hold the remainder from employees' paychecks immediately. On the issue of whether the City violated its duty to bargain by failing to abide by the parties' grievance procedure, I agree with my colleagues that once the Teamsters' grievance was filed, it was the City's responsibility to act on it in some fashion. The parties' contract specifies a time limit within which the City was required to act, and specifies the penalty for failure to do so. However, since the Teamsters also failed to follow the grievance procedure -- by skipping the first two steps and by failing to request a hearing at step three -- I would -33- require the parties to split the costs of the premium increase equally for the time period from January 1 to December 1, 1993. Issued at Augusta, Maine, this 13th day of January, 1994. MAINE LABOR RELATIONS BOARD /s/_________________________ Pamela D. Chute Alternate Chair -34-