STATE OF MAINE MAINE LABOR RELATIONS BOARD
Case No. 94-45
Issued: February 15, 1995
___________________________________
)
BANGOR FIREFIGHTERS ASSOCIATION, )
LOCAL 772, IAFF, AFL-CIO-CLC, )
)
Complainant, )
)
v. ) DECISION AND ORDER
)
ROBERT W. FARRAR and )
CITY OF BANGOR, )
)
Respondents. )
___________________________________)
On June 10, 1994, the Bangor Firefighters Association, Local
772, IAFF, AFL-CIO-CLC ("Association") filed a prohibited
practice complaint with the Maine Labor Relations Board ("Board")
alleging that Robert W. Farrar and the City of Bangor (collec-
tively, "the City") violated section 964(1)(A), (B) and (E) of
the Municipal Public Employees Labor Relations Law ("MPELRL"),
26 M.R.S.A. 964(1)(A), (B) and (E) (1988), by refusing to flesh
out a bargaining proposal on employee retirement, engaging in
unlawful regressive bargaining, surface bargaining and pattern
bargaining, refusing to remove its retirement proposal from the
bargaining table prior to fact finding, and insisting on a
contract provision known to be illegal on its face. In its
response, the City denied the allegations and moved for dismissal
for failure to state a claim. The Association then filed a
motion for default against the City on the ground that the City's
response had not been properly served.
A prehearing conference was convened in this matter on
August 3, 1994, by Alternate Chair Kathy M. Hooke. In the
Prehearing Conference Memorandum and Order, issued on August 12,
1994, and incorporated in and made a part of this Decision and
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Order, both the Association's motion for default and the City's
motion to dismiss were denied.
An evidentiary hearing was held on September 7 and
November 16, 1994. Alternate Chair Hooke chaired the hearing,
accompanied on the first day by Alternate Employer Representative
Eben B. Marsh and Employee Representative George W. Lambertson.
Due to an extended illness, Mr. Lambertson was unable to continue
sitting on the case and was replaced by Alternate Employee
Representative Gwendolyn Gatcomb on the second day. Mr. Robert
F. Bourgault represented the Association, and Thomas C. Johnston,
Esquire, represented the City. The parties were given full
opportunity to examine and cross-examine witnesses, introduce
documentary evidence, and make oral argument. Both parties
requested copies of the transcript, which were mailed on
November 23, 1994. The parties filed posthearing briefs on
December 13, 1994. The Board deliberated this matter on
January 4, 1995.
JURISDICTION
The Association is the bargaining agent, within the meaning
of 26 M.R.S.A. 962(2) (1988), for a unit of firefighters,
lieutenants, captains, dispatchers and the mechanic employed in
the Bangor Fire Department. The City is the public employer,
within the meaning of 26 M.R.S.A. 962(7) (Supp. 1994), of the
employees in the 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. The most recent collective bargaining agreement between
the Association and the City was in effect from July 1, 1990,
through June 30, 1993. Article 33 of that agreement states that
the City will continue to provide retirement benefits pursuant to
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various provisions of the Maine State Retirement System ("MSRS")
that outline retirement benefits for employees of participating
local districts ("PLDs").1 The City of Bangor is currently a
PLD; employees in its eight bargaining units,2 most of its
employees who are not organized for the purposes of collective
bargaining, and members of a support staff bargaining unit
employed by the Bangor School Department are all covered by MSRS
through the City's status as a PLD.
2. The parties met on May 18, 1993, for negotiations;
they reached agreement in principle on ground rules governing
negotiations, and on May 23, 1993, executed those ground rules.
Paragraph 8 of the ground rules states:
8. Economic and Non-Economic Considerations
A. At or before the first bargaining session
following agreement on the Ground Rules, the Union, as
the moving party shall submit its complete package of
economic and non-economic proposals for collective
bargaining to the City. The City will have the
opportunity to review and clarify the Union's proposal.
B. At the next scheduled meeting between the
parties, the City shall submit its complete package of
economic and non-economic proposals for collective
bargaining to the Union. The Union will have the
opportunity to review and clarify the City's proposal.
C. The parties agree that once initial opening
bargaining proposals have been exchanged, that no
additional economic or non-economic items shall be
submitted by either party unless mutually agreed
otherwise. It is further understood that the City's
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1It also contains, in paragraph 6, a reopener clause to be
used in the event that the City wishes to consider withdrawing
from MSRS during the term of the agreement.
2In addition to the firefighters' unit, represented by the
Association, there are three police units, three units repre-
sented by AFSCME Council 93 (public works, aircraft mechanics and
Bass Park employees), and a nurses' unit represented by the
Federation of Nurses and Health Professionals.
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economic proposals may be presented as a package rather
than on an item by item basis.
At some point early in the negotiations, the parties made an
informal agreement to pursue non-economic issues first.
3. At the May 18th meeting, the Association presented its
negotiation proposals in writing to the City. They included
increases in wages, paid vacation time, number of paid holidays,
sick leave, and health insurance benefits. The Association also
proposed two improvements in Article 33, Retirement (one to
extend firefighter benefits to the dispatchers and mechanic, and
the other for the City to adopt military credits for all
veterans).
4. On June 8, 1993, the City presented its proposals in
writing to the Association. They included cuts in wages, paid
vacation time, paid holidays, sick leave and health insurance
benefits. One of the City's initial proposals was as follows:
Article 33 - Delete: Current Paragraph 6. Replace
with the following:
6. The City shall continue to provide retirement
benefits through the Maine State Retirement System as
specifically detailed in paragraphs 1 and 5 above until
such time as an "alternate defined contribution plan"
so-called shall be made available. At the time that
such alternate plan is in place and available, all
employees covered by this Agreement, who are partici-
pating in the Maine State Retirement System shall be
provided the option of either continuing to participate
in the Maine State Retirement System or electing to
participate in the alternate plan, subject to statutory
requirements governing Maine State Retirement. Any
employee hired after the inception date of the
alternate plan shall be required to participate in the
alternate plan.
For all other bargaining unit contracts under negotiation in
1993, the City initially proposed the same retirement language.
5. Early in the negotiations, the City explained that the
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intent behind its proposal was to withdraw from MSRS and begin
participating in a defined contribution plan offered by the ICMA
Retirement Corporation ("ICMA"); it also explained the reason for
its desire to withdraw -- the very large, unfunded liability that
had already accrued and the potential for further liability to
accrue if the City remained in the system. (Currently, the
City's payment toward the unfunded liability already accrued is
21.35 percent of firefighter payroll.) The City further
explained that under current law, it cannot withdraw from MSRS
unless it withdraws its entire plan. On two occasions, the City
caused legislation to be introduced in the Maine Legislature that
would have granted PLDs the option of partial withdrawal -- that
is, the option to withdraw on a bargaining unit-by-unit basis.
The legislation did not pass.
6. From July through December of 1993, the parties met for
negotiations on approximately ten occasions, and reached
tentative agreement on numerous non-economic issues. On several
of those occasions, the Association requested that the City
provide more detail with regard to its retirement proposal. More
specifically, the Association requested information on what level
of retirement contribution the City was offering to make, and
whether the City would guarantee that contribution for some
extended period of time; what contribution employees would be
required to make; the length of the vesting period being proposed
by the City; and the nature of any disability and survivor
benefits to be provided. On one occasion Mr. Farrar was told by
the Association that if he gave them more information, they would
be interested in the proposal. At various times the City did
state that it would be offering a disability plan comparable to
the MSRS plan, but provided no specifics. No other clarifying
detail was provided by the City in response to the Association's
repeated requests. The Association did not make any proposals of
its own as to these matters. The City held a meeting for
employees in September of 1993, during which an ICMA represen-
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tative explained basics of the ICMA plan such as the types of
investments employees may choose, the tax consequences of the
plan, examples of potential retirement accumulations.
7. At various sessions during negotiations, in addition to
requesting that the City flesh out its proposal, the Association
suggested the possibility of carriers other than ICMA, and also
suggested the newly established consolidated MSRS plan as an
alternative to the City's ICMA proposal. (The purpose of the
consolidated plan is to reduce administrative costs to PLDs. The
consolidated plan would also benefit employees, since it has
greater portability than the current MSRS plan, expands military
service credits, provides an improved disability plan, and adds
an employee-elective defined contribution option.) The City made
it clear that it did not want to consider this proposal because
it planned to be out of the MSRS. On one occasion Mr. Farrar
told a union bargaining representative that he had been told by
the city council not to bring back a contract proposal that had
Maine State Retirement in it. The Association also suggested
that it would consider the ICMA proposal for new employees if
benefits for employees currently in the MSRS were increased from
1/2 pay to 2/3 pay. The City did not pursue this overture
because, according to Mr. Farrar, the City did not feel the
proposal adequately addressed the Association's concerns. At
various negotiation sessions, the Association also made known its
reservations about the City's proposal other than its lack of
specificity -- namely, the significant investment risk associated
with switching from the MSRS defined benefit plan to a defined
contribution plan and the lack of a guarantee beyond the life of
the new contract regarding the City's contribution rate to the
ICMA plan -- particularly in light of the one-year contract term
being demanded by the City. The parties did discuss the issue of
an employer-rate guarantee (not the rate itself) on several
occasions, but were unable to find a means for making a
guarantee.
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8. On or about November 9, 1993, the parties requested the
services of a mediator; on January 12, 1994, the mediator met
jointly with the parties, and then met with the Association
separately regarding its "bottom line" position on outstanding
issues. On January 19, 1994, the mediator met separately with
the City to discuss its bottom line on outstanding issues. On
March 18, 1994, the mediator met with the parties separately and
then met with them in a joint session, informing them privately
and jointly that he did not believe further mediation would be
fruitful. Retirement was a major focus of discussion in
mediation, but in neither joint mediation session did the City
provide the Association with details of its retirement proposal.
9. In negotiations with the nurses' bargaining unit, when
the City's bargaining representative Robert Farrar was confronted
with the lack of specifics in the proposal he stated that
employees would get the new plan whether they liked it or not,
because of the Mountain Valley decision. In negotiations for one
police unit, Mr. Farrar commented to the effect that employees
could take the proposal now or take it later and mentioned a
decision, though not by name. On at least one occasion during
negotiations with the Association, Mr. Farrar mentioned that he
felt the MSAD 43 [Mountain Valley] decision would apply to the
parties' dispute over retirement -- that the City could implement
its retirement proposal without the agreement of the Associa-
tion.3
__________________________
3Although Mr. Farrar testified that he mentioned Mountain
Valley in a private meeting with the mediator, and did not recall
mentioning it to the Association directly, we credit the testi-
mony of two witnesses who testified otherwise. We do so after
observing the demeanor of all witnesses and in light of 1) the
uncontroverted testimony of representatives of two other
bargaining units regarding similar remarks by Mr. Farrar; and
2) the City's opening statement at hearing in which a
justification was provided for Mr. Farrar's remarks to the
Association.
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10. On or about April 21, 1994, the parties met to deter-
mine what issues would be submitted to fact finding. On May 4,
1994, the Board received a joint request for fact-finding
services. Article 33, Retirement, was on the list of issues in
controversy that accompanied the joint request.
11. By letter dated May 17, 1994, the Association demanded
that the City remove its retirement proposal from the bargaining
table prior to fact finding. The letter further stated:
It is the Union's position that the foregoing proposal
constitutes a demand for a waiver of statutory rights
granted under Chapter 9-A Title 26, the Municipal
Public Employees Labor Relations Law, and is therefore
a permissive subject of bargaining. The Union recog-
nizes that the subject of pensions per se, is a manda-
tory subject. However, the City's proposal as pre-
sented and insisted upon, falls outside that mandatory
scope.
12. By letter dated May 31, 1994, the City notified the
Association that discussions were underway regarding the May 17th
demand, and that a formal response would be forthcoming. In a
second letter dated June 20, 1994, the City informed the
Association that it believed that the Union had an obligation to
continue in negotiations on the issue of changing the retirement
program. The City also expressed a willingness to review an
opinion of the Attorney General that the Association had referred
to in a phone conversation.4
13. A fact-finding hearing was held before the Board of
Arbitration and Conciliation on August 11-12, 1994. Both the
Association's and the City's retirement proposals were presented
to and addressed by the fact-finding panel in its report issued
on September 22, 1994. The City did not provide any detail to
the fact-finding panel in connection with its retirement
__________________________
4Presumably in connection with the Association's contention
that the City could not lawfully distinguish between current and
future employees in its retirement proposal.
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proposal.
14. In a subsequent negotiation session on November 7,
1994, in connection with its retirement proposal, the City for
the first time proposed contribution rates (10 percent for the
City and 6.5 percent for employees) and a vesting period (one
year). It also indicated an intention to offer optional
disability and life insurance plans at the employee's expense,
and to offer two plan sponsors rather than the one originally
offered (ICMA). The City also expressed a willingness in writing
to discuss compromises on such issues as wages and the work
schedule (hours worked). Some agreements were reached, contin-
gent on settlement of the whole contract.
15. On the date that the evidentiary hearing in this matter
was concluded, November 16, 1994, five of the City's eight
bargaining units had concluded contract negotiations. In
addition to the firefighters' contract, one police unit contract
and the nurses' unit contract were still under negotiation. The
superintendent of schools has informed the City that when the
City is ready to withdraw from MSRS, he will be "ready to go" as
well -- that according to the City, the superintendent "will be
able to effectuate what is needed to allow the City to withdraw."
DISCUSSION
At the heart of the dispute before us is the desire of the
City of Bangor to withdraw from the Maine State Retirement System
and the desire of the Association that the withdrawal not occur.
The City is concerned about the potential for increases in its
unfunded liability as a participating local district in MSRS; the
Association is concerned about the investment risk associated
with a defined contribution plan, as well as the fact that there
is (and can be) no long-term guarantee regarding the rate of
contribution by the City into any such alternate plan since the
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MPELRL limits collective bargaining agreements to terms of three
years. Substantially complicating the parties' dispute is the
fact that withdrawal from MSRS cannot occur on a unit-by-unit
basis, and nine bargaining units (eight City units and one school
unit) currently are covered by the MSRS through the City's status
as a participating local district.
The Association alleges that the City violated section
964(1)(A), (B) and (E) of the MPELRL during negotiations for a
successor contract by refusing to flesh out a bargaining proposal
on employee retirement, engaging in unlawful regressive bargain-
ing, surface bargaining and pattern bargaining, refusing to
remove its retirement proposal from the bargaining table prior to
fact finding, and insisting on and intending to implement a
contract provision known to be illegal on its face. The City
denies the allegations.
Before we address the actions of the City that the Associa-
tion alleges constitute violations, we note preliminarily that
section 964(1)(B) of the MPELRL prohibits "[e]ncouraging or
discouraging membership in any employee organization by
discrimination in regard to hire or tenure of employment or any
term or condition of employment" (emphasis added). There is
absolutely no evidence in the record to suggest that any
discrimination based on union membership occurred. Accordingly,
we will dismiss this allegation without further discussion.
The Board has on numerous occasions outlined the factors
relevant to a determination of whether bargaining in good faith,
pursuant to section 965(1)(C) of the MPELRL, has occurred.
"Among such indicators of good faith bargaining are whether the
parties have: met and negotiated at reasonable times, observed
the negotiating ground rules, offered counterproposals, made
compromises, accepted the other party's positions, explained and
provided justification for their own positions, reduced tentative
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agreements to writing, and participated in the dispute resolution
procedures." Auburn Firefighters Association v. Valente, No. 87-
19, slip op. at 10, 10 NPER ME-18017 (Me.L.R.B. Sept. 11, 1987),
citing Waterville Teachers Association v. Waterville Board of
Education, No. 82-11, slip op. at 4, 4 NPER 20-13011 (Me.L.R.B.
Feb. 4, 1982); and Sanford Highway Unit v. Town of Sanford, No.
79-50, slip op. at 10-11, 1 NPER 20-10012 (Apr. 5, 1979), aff'd,
411 A.2d 1010 (Me. 1980).
Surface bargaining
The thrust of the Association's complaint is that the City
never had an intent to reach agreement with the Association on
the issue of retirement, but rather intended at the outset to
accomplish its goal of withdrawing from MSRS, whether or not
agreement was reached. To achieve its goal, argues the
Association, the City bargained regressively on other subjects of
bargaining, refused to flesh out its retirement proposal when
asked to do so on numerous occasions, engaged in pattern
bargaining and improperly raised the spectre of unilateral
implementation under the Mountain Valley decision.
It is not unlawful to take a tough bargaining stance on a
single issue, if adequate justification for that stance is
provided to the other party. Teamsters Local Union No. 340 v.
Portland Housing Authority, No. 90-13 (Me.L.R.B. Dec. 3, 1990).
See also Southern Aroostook Community School Committee v.
Southern Aroostook Teachers Association, No. 75-05, slip op. at 3
(P.E.L.R.B. Nov. 21, 1974) (interim decision). Nor do we know of
anything to prevent an employer from attempting to obtain the
same provision from multiple bargaining units,5 particularly
__________________________
5Or a union that represents multiple units from attempting
to obtain the same provision for each unit. It must simply use
lawful means to do so. Utility Workers Union of America, 203
NLRB 230 (1973), enf'd, 490 F.2d 1383 (6th Cir. 1974).
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where, as here, agreement with multiple units is the only way
that the provision can be implemented.
That is not to say, however, that it is lawful to bargain
with a take-it-or-leave-it attitude. Teamsters Local Union No.
48 v. City of Augusta, No. 78-04, slip op. at 4 (Me.L.R.B.
June 7, 1978). See also American Meat Packing Corp., 301 NLRB
835, 835 (1991), citing General Electric Co., 150 NLRB 192
(1964), enf'd, 418 F.2d 736 (2d Cir. 1969). Looking at the
totality of the city's conduct, we find that the City did just
that, and therefore violated its duty to bargain in good faith.
We base our finding on three acts/omissions by the City.
First and foremost is the City's unwillingness, until well
after fact finding had been completed, to flesh out its retire-
ment proposal in critical respects -- in spite of repeated
requests that it do so. The City provided various excuses for
its failure. We are not persuaded by the City's argument that it
was simply waiting to flesh out its proposal until the parties
reached economic subjects in their bargaining and an economic
"package" could be proposed. The parties' ground rules specifi-
cally required that each party submit "its complete package of
economic and non-economic proposals" to the other party at the
outset of negotiations. The City did so on wages, health insur-
ance and other economic issues -- in fact, on every economic
issue except retirement. We are equally unpersuaded by Mr.
Farrar's statement that he didn't provide the information because
he didn't believe the Association was seriously interested in the
City's proposal. Even if that were a legitimate reason for
refusing to flesh out a proposal and Mr. Farrar was correct about
the Association's position, refusing to flesh out the proposal
was hardly the way to change the Association's attitude if the
City truly sought to find a basis for agreement. Further, the
September 1993 presentation by ICMA, touted by the City as
providing detail on its proposal, did not (and could not) satisfy
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the Association's requests for specificity, since under the ICMA
plan matters such as contribution rates and vesting schedule are
subject to negotiation between the employer and its employees
(they are set by statute under MSRS). Finally, it does not help
the City's case that the Association itself did not make offers
regarding employer and employee contribution rates and a vesting
schedule. It is the City that is proposing this change in the
retirement provision in the parties' contract, and it is the City
that has the burden of making its proposal specific enough for
the Association to analyze and respond to it in a meaningful way.
In sum, we find that the City's demand, over a period of more
than a year, that the Association buy into the concept of ICMA
without so much as a single hard number on the table for
discussion frustrated any prospect for reaching agreement. Alton
Community Unit School District 11, 5 PERI 1054, 11 NPER IL-
20070 (Ill.E.L.R.B. Hearing Officer, Mar. 1, 1989); Blairsville-
Saltsburg School District, 17 PPER 17143, 8 NPER PA-17143
(P.L.R.B. Hearing Examiner, June 13, 1986).
Our finding of surface bargaining is also based on the
City's statement(s) to the Association and to others that it
could implement its retirement proposal without consent under the
Mountain Valley decision.6 A discussion regarding the potential
for unilateral implementation might, in some circumstances, be
appropriate after parties have participated in good faith in all
of the MPELRL's dispute resolution procedures and have been
unable to reach agreement. However, the City's focus on that
possibility was clearly premature and, we find, indicative of the
state of mind with which the City conducted negotiations.
__________________________
6Mountain Valley Education Association v. MSAD #43 Board of
Directors, No. 93-15 (Me.L.R.B. Aug. 19, 1993), aff'd, No. CV-93-
437 (Me. Super. Ct., Ken. Cty., Apr. 8, 1994), appeal docketed,
No. KEN-94-452 (Me. May 9, 1994).
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The third factor in making our determination of surface
bargaining is the lack of evidence of any substantial concession
on the City's part on other major non-retirement issues until
after fact finding had been completed. This finding is based on
the testimony received at the hearing as well as the report of
the fact finders which was submitted as a joint exhibit. While
the City's desire to withdraw from MSRS is legitimate, the
Association's concerns about withdrawal are equally legitimate.
In these circumstances, and where compromise on the basic premise
of the proposal (withdrawal from MSRS) is difficult without
abandoning the proposal itself, movement must occur elsewhere in
order to effectuate the principle of give and take which is at
the heart of the collective bargaining process.7
The Board has been reluctant to find surface bargaining
where both parties have refused to compromise. Teamsters Local
Union No. 48 v. City of Augusta, slip op. at 4. That is not the
case here. The Association asked for specifics regarding the
City's retirement proposal, presumably in order to be able to
analyze and respond to it. The Association also offered other
changes in the parties' current retirement provision as alter-
natives to withdrawal from MSRS. Finally, the Association stated
that it would be willing to consider withdrawal if retirement
benefits were increased for current employees who chose to con-
tinue in MSRS after withdrawal occurred. The City's failure to
pursue these overtures is further indication of its intransigent
state of mind.
We find that the City engaged in surface bargaining, thereby
__________________________
7We reject the Association's claim that the City engaged in
actual regressive bargaining. Review of the initial proposals of
both parties and the fact-finding report leads us to conclude
that the City's proposed take-backs were, as it stated, simply
made in response to the Association's request for several changes
in the contract in the other direction. There is nothing
unlawful about such a tactic.
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violating its duty to bargain in good faith and section 964(1)(E)
of the MPELRL. Surface bargaining inherently undermines the
status of the bargaining agent and therefore interferes with,
restrains and coerces employees in the exercise of their
bargaining rights. Accordingly, we also find that the City
violated section 964(1)(A) of the MPELRL. We will order the City
to cease and desist from refusing to bargain in good faith and
from interfering with, restraining and coercing members of the
firefighters' unit by engaging in surface bargaining, and to take
the affirmative action of posting the attached Notice.
Refusal to remove permissive subject from table
The second major allegation in the Association's complaint
is that the City refused, when requested, to remove its retire-
ment proposal from the bargaining table prior to fact finding.
The proposal as presented is a permissive subject, the Associa-
tion asserts, because "such a vague and imprecise proposal is
indistinguishable from a demand for a bargaining waiver on a
mandatory subject of bargaining."
We disagree with the Association that the City's proposal
constituted a demand for a bargaining waiver by virtue of its
vagueness. While the City bargained in bad faith by, among other
things, refusing to provide specificity to its proposal in a
timely fashion, it never took the position that employer and
employee contribution rates, a vesting schedule and other such
details would be left to the discretion of the City and never be
negotiated. Rather, the City was demanding that the Association
agree to the concept of the proposal, with details to be negoti-
ated later. In any case, it is not clear to us that a demand for
a bargaining waiver is necessarily a permissive subject of
bargaining, regardless of the number of mandatory subjects on
which a waiver is demanded or the nature of the waiver. See
Toledo Blade Co., 295 NLRB 626 (1989) (provision waiving right to
participate in bargaining with individual employees over early
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retirement is mandatory subject); NLRB v. Tomco Communications,
567 F.2d 871 (9th Cir. 1978) (zipper clause is mandatory
subject). But see also Deerfield Community School District, 2
NPER 51-11023 (W.E.R.C. Dec. 19, 1979), aff'd, Dec. No. 17503
(Dane Cty. Cir. Ct. Jan. 13, 1981) (zipper clause is permissive
subject); Palm Beach Jr. College v. United Faculty of Palm Beach
Jr. College, 475 So.2d 1221 (Fla. 1985) (waiver of statutory
right to bargain impact of management prerogative is permissive
subject); Grundy Center Community School District, 8 NPER IA-
17018 (Ia.P.E.R.B. Apr. 18, 1986) (merit pay proposal which
failed to reference either specific amount to be paid or formula
for calculating pay is permissive). Since we need not reach the
issue of whether the demand for a bargaining waiver is a
permissive subject of bargaining, we will not resolve it.
We disagree with our dissenting colleague that the provision
ceded substantive decision-making power to third parties. Were
this the case, we agree that the provision would be permissive
and therefore required to be withdrawn by the City upon receipt
of a timely request by the Association. The dissent's position,
however, confuses provisions in a binding agreement that address
possible changing external circumstances with prerequisites for
reaching a binding agreement in the first place.
The test for whether a proposal is a mandatory subject of
bargaining is whether it falls within the "wages, hours, working
conditions and contract grievance arbitration" language of
section 965(1)(C) of the MPELRL. SAD #22 Non-Teachers Associ-
ation v. SAD #22 Board of Directors, No. 79-32, slip op. at 5,
1 NPER 20-10024 (Me.L.R.B. July 30, 1979). The Association and
the dissent agree that retirement is normally a mandatory subject
of bargaining because retirement benefits are a form of wages.
Our dissenting colleague argues, however, that because the
outcome of negotiations with other bargaining units will govern
whether or not the firefighters' unit will continue to be covered
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by MSRS, the contingency created by the City's proposal is the
same as those found to be permissive in SAD #22 and an earlier
case, Maine Teachers Association v. Sanford School Committee,
No. 77-18, -19, -20 & -29 (Me.L.R.B. June 13, 1977).
This conclusion obscures crucial differences between those
two cases and the issues here. The provision at issue in SAD #22
made implementation of the agreement and its benefits expressly
dependent upon appropriation of necessary funds by the voters of
SAD #22. Essential to the Board's discussion of the SAD #22
provision was its perception that the provision undermined the
very existence of a binding agreement between the parties. Thus,
in reviewing whether the contingent implementation facet of this
provision was mandatory or permissive, the Board first cited the
principle articulated in Allied Chemical & Alkali Workers Local 1
v. Pittsburgh Plate Glass Co., 404 U.S. 157 (1971) that a
mandatory subject must "settle an aspect of the relationship
between the employer and employee," SAD #22, slip op. at 5,
quoting 404 U.S. at 178. The Board found that the contingency
implementation facet of the clause could not be said to settle
anything. "Rather, the entire, bargained agreement is nullified
by the eventuality of the contingency. Thus, the premise of
collective bargaining is absent in this facet of the
implementation article." Id. at 5.
The Board then analogized to a provision found to be permis-
sive in NLRB v. Wooster Division of Borg-Warner Corp., 356 U.S.
342 (1958), finding that, like the membership ballot clause at
issue in Borg-Warner:
The contingency implementation clause here has the same
effect of weakening the collective bargaining system both
by allowing the public employer, established by defini-
tion in 26 M.R.S.A. sect. 962(7), to avoid its duty to
bargain by shunting a ratification decision to the voters
and, furthermore, thereby denying the employees the power
to bargain for their working conditions with their
employer.
-17-
SAD #22, slip op. at 6.
Finally, the Board relied on its prior decision in Sanford
where it had found to be permissive "the subject of ratification
by a body other than the public employer, of an agreement reached
by the representative of the public employer." SAD #22, slip op.
at 6, quoting Sanford, slip op. at 5. As the Board pointed out:
"Power to make agreements resides with the public employer as
does the accompanying duty to bargain and execute agreements
reached." Id.
Thus, the contract provisions in the cases relied on by the
dissent interfered with the power to make binding decisions, a
fundamental premise of the collective bargaining process. For
this reason, they were considered to be permissive and not the
subject of required bargaining.
The proposal in this case differs significantly from those
involved in SAD #22 and Sanford. First, the express language of
the provision does not create a condition precedent or mention
third parties. It simply states that the City will continue to
provide retirement benefits under the MSRS until an alternate
defined contribution plan is available. Thus, the language of
the provision provides for a predetermined change upon occurrence
of a condition subsequent to a binding agreement. It does not by
its terms set up third-party approval as a prerequisite for the
agreement to come into being. As an initial matter, therefore,
the express language of the provision does not cede the power to
make binding decisions to third parties.
Second, the provision at issue in this case, unlike those
considered by the Board in SAD #22 and Sanford, does not
impliedly cede decision-making power to third parties. It is up
to the Association to agree or not to agree to make the ICMA
alternative a part of its agreement. If it agrees, it is the
Association's further responsibility to shape the alternative's
-18-
substantive specifics, including levels of employer and employee
contributions, vesting periods, and disability and survivor
benefits. Nothing about the provision gives any part of this
decision-making process to third parties. Retention of
substantive decision-making distinguishes this case from the
parity pay cases relied on by the dissent.
Finally, again unlike the cases relied on by the dissent, the
agreement between the Association and the City, if one is
reached, will in no sense be subject to ratification by third
parties. Whatever the results of the independent negotiations of
the other bargaining units in the Bangor PLD, the collective
bargaining agreement reached between the Association and the City
will stand. It will not be reduced to a nullity and will
continue to be binding on both parties.
It is true that, depending on the actions of third parties --
other unions in the Bangor PLD or the Legislature or the MSRS
itself -- different provisions of the contract may apply. Thus,
under the provision sought by the City, if "an alternate defined
contribution plan" becomes available, one defined result will
occur. If it doesn't, another defined result will occur, namely
continuance of pension rights as defined by the MSRS. But in
either case, the result will have emerged from, and been defined
by, an independent collective bargaining process carried through
to completion by appropriate bargaining agents for employer and
employee, independent of third parties. To settle an issue by
negotiating alternative outcomes is still to settle an issue.
This is a far cry from the situations in SAD #22 and Sanford
where the Board found that a third party had been given the power
to nullify the very existence of a binding contract, the premise
of the collective bargaining process.
Thus, neither the express language of the provision at issue,
the facts of the cases relied on by the dissent, nor their
underlying rationale supports the conclusion that this provision
-19-
shunted decision-making responsibility away from the bargaining
parties to third parties in a manner sufficient to turn a clearly
mandatory subject into a permissive one.8
Insistence on an illegal contract provision
Finally, we disagree with the Association's allegation that
the City further engaged in bad faith bargaining by insisting on
a contract provision known to be illegal on its face. At issue
in connection with this allegation is the Association's apparent
belief that if the City withdraws from MSRS, it cannot make a
distinction between current and future employees. While it is
true that under current MSRS law the City cannot withdraw from
MSRS as a PLD on a unit-by-unit basis, it appears to us that it
must make a distinction between current employees and those
employed after withdrawal occurs. Under 5 M.R.S.A. 18254
(1989), current employees themselves decide whether to remain in
the system or withdraw their accumulated contributions, while
persons employed after withdrawal may not participate. We will
dismiss this allegation.
ORDER
On the basis of the foregoing findings of fact 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. 1994), it is hereby ORDERED:
1. That the City of Bangor and its agents and represen-
tatives shall:
__________________________
8We agree with the dissent that the Association's failure to
raise third-party decision making is not fatal because the
Association did raise the general issue of permissiveness. The
Association's failure to advance the third-party decision making
argument, however, does shed light on how the parties to these
negotiations understood the nature of the City's proposals. The
parties' understanding of contract terms is a relevant
consideration when interpreting those terms.
-20-
a. Cease and desist from refusing to bargain in good
faith and from interfering with, restraining and
coercing members of the firefighters' unit by
surface bargaining on the mandatory subject of
employee retirement.
b. Take the following affirmative action that is
necessary to effectuate the policies of the
MPELRL:
i. Sign, date and post, within 10 calendar days
of the date of issuance of this decision and
order, at all locations where notices to
members of the firefighters' unit are
customarily posted, copies of the attached
"Notice." The Notice shall remain posted for
a period of two weeks.
ii. Notify the executive director, in writing,
within 25 calendar days of the issuance of
this decision and order, of the steps that
have been taken to comply with this order.
2. That complainant's remaining allegations are dismissed.
Issued at Augusta, Maine, this 15th day of February, 1995.
MAINE LABOR RELATIONS BOARD
The parties are hereby advised
of their right, pursuant to
26 M.R.S.A. 968(5)(F) (Supp. /s/___________________________
1994), to seek review of this Kathy M. Hooke
decision and order by the Alternate Chair
Superior Court. To initiate
such a review, an appealing
party must file a complaint
with the Superior Court within /s/___________________________
fifteen (15) days of the date Eben B. Marsh
of issuance of this decision Alternate Employer
and order, and otherwise Representative
comply with the requirements
of Rule 80C of the Maine Rules
of Civil Procedure.
Alternate Employee Representative Gwendolyn Gatcomb filed a
separate opinion, dissenting in part.
-21-
OPINION
I agree with my colleagues that the City did not violate the
MPELRL by either engaging in unlawful regressive bargaining or
insisting on an illegal contract provision. I also agree that if
the City's retirement proposal were a mandatory subject of
bargaining, the City would have refused to bargain in good faith
by engaging in surface bargaining. I even agree that it is not
always easy to resolve the question of whether a particular
waiver of bargaining rights is a permissive or mandatory subject.
However, that question is easy to resolve in the case before us.
The City's proposal is a permissive subject because it cedes
decision-making on a mandatory subject to third parties.
As the Board pointed out in SAD #22, slip op. at 5, citing
Allied Chemical, 404 U.S. at 178, for a subject to be mandatory
it must "settle an aspect of the relationship between the
employer and employee." As with the provision at issue in SAD
#22, the City's proposal cannot be said to "settle" anything.
Were the availability of an alternative to MSRS solely within the
discretion of the City, it could at least be argued that the
issue of retirement would be settled by making the decision a
management prerogative. That is not the case. Whether or not
the firefighters' unit will continue to be covered by MSRS is
dependent on the outcome of negotiations in other bargaining
units, one of which is not even a bargaining unit of this
employer! There is no difference in kind between this contin-
gency clause and the contingency clauses that the Board was faced
with in SAD #22 and Sanford. In both of those cases, the
employer's proposal would have required ratification of contract
provisions by a body or bodies other than the employers them-
selves (town voters, warrant committee).9
__________________________
9There were other aspects of the contract provision proposed
in SAD #22 that the Board determined to be unlawful. They are
not relevant here.
-22-
This Board is not alone in finding that a demand to cede
decision-making on a mandatory subject to a third party or
parties is a permissive subject of bargaining. NLRB v. Borg-
Warner Corp., 356 U.S. 342 (1958) (demand for employee vote on
union's strike decisions is a permissive subject); NLRB v. Cheese
Barn, 558 F.2d 526 (9th Cir. 1977), and cases cited therein
(employee ratification of collective bargaining agreement is a
permissive subject fn10); Amer-Cal Industries, 274 NLRB 1046 (1985)
(proposal conditioning signing of contract on employee decer-
tification vote is permissive subject); Springfield Housing
Authority v. Labor Relations Commission, 454 N.E.2d (Mass.App.
1983) (demand for approval of collective bargaining agreement by
third party, Department of Community Affairs, is permissive
subject). That is because such a contingency clause has the
effect of "weakening the collective bargaining system both by
allowing the public employer . . . to avoid its duty to bargain
. . . and denying the employees the power to bargain for their
working conditions with their employer." SAD #22, slip op at 6.
The contract proposal before us is also somewhat analogous to
a parity clause fn11 -- in each, a term and condition of employment
for one unit is dependent on the outcome of negotiations in
another. Although parity clauses are lawful in some jurisdic-
tions, they are not lawful in many others, including Maine.
Lewiston Firefighters Association v. City of Lewiston, 354 A.2d
154 (Me. 1976). That is because they "violate the coherence of
the bargaining unit and thereby interfere with a right conferred
upon employees collectively to secure the processes of labor-
management bargaining." Id. at 162. Stated another way, parity
__________________________
10Since the parties to a collective bargaining agreement are
the employer and the bargaining agent, employees themselves are
third parties.
11A parity or "me-too" clause grants a benefit to one
bargaining unit that is triggered by granting it to another.
-23-
provisions in effect force a bargaining agent to bargain not only
for the employees it represents, but for the employees in another
unit as well. Id. at 161. Although, given the current with-
drawal requirements of the MSRS, I would not hold that the City's
retirement proposal is unlawful, it can be no more than permis-
sive.
My colleagues avoid this result by holding first that as long
as a bargaining proposal does not on its face require third-party
approval to be implemented, it is not a permissive subject. That
holding does major injustice to a basic principle of contract
interpretation.12 A primary rule of construction is that pro-
visions must be interpreted to give effect to the intent of the
parties. F. Elkouri and E.A. Elkouri, How Arbitration Works, at
348 (4th Ed. 1985). That principle should be applied even more
rigorously where, as here, there is no dispute as to the meaning
of the provision. The City's proposed provision hinges implemen-
tation of an alternative to MSRS on its future availability,
precisely because its availability is not assured. The City
cannot implement an alternative to MSRS without withdrawing from
MSRS. It cannot withdraw from MSRS without withdrawing all nine
bargaining units now covered. If that were not the case, this
dispute would not be before us.13
__________________________
12It is also inconsistent with the majority's finding that
the proposal is not permissive based on vagueness. Nowhere on
its face does the proposal say that details of the ICMA will be
negotiated later.
13It is no accident that Mr. Farrar, in testifying on the
status of other contract negotiations, stated that "in all [five]
of those contracts we do have the new language allowing us to
withdraw from Maine State and establishing the new alternate
retirement plan." He also stated, in answering a question
regarding whether other units that have agreed to the contract
provision on retirement know when it will take effect: "No, they
do not. Their contract is open ended pending resolution with
other units."
-24-
The majority's second reason for finding that the provision
is not permissive is that it does not even impliedly cede
decision-making to third parties. The majority reaches this
conclusion by drawing a distinction between a provision that, in
one alternative, will nullify the parties' agreement, and a
provision that, in one alternative, will change the agreement.
Since, in both instances, it is third parties that will
ultimately decide which alternative obtains, the majority has
created a distinction without a difference. Moreover, the
distinction in no way explains either Borg-Warner or Lewiston.
Borg-Warner involves an employer demand that, during the term of
the contract, the union's strike decisions in connection with
nonarbitrable disputes be subject to an employee vote. Lewiston
involves a parity, or "me-too" provision -- a union demand that,
should another bargaining unit's benefits be improved, they will
be improved for members of the union's bargaining unit also.
The Association requested, in a timely fashion,14 that the
City remove its retirement proposal from the bargaining table
prior to fact finding, on the ground that it constituted a demand
for a waiver of bargaining rights and therefore was a permissive
subject of bargaining. The City's retirement proposal would
require the Association to waive its right to make the final
decision regarding the choice of retirement plans and put that
decision in the hands of third parties. Therefore the proposal
is a permissive subject of bargaining.15 Accordingly, I would
__________________________
14The City is wrong that the Association's demand was made
too late. The Board has previously stated that the demand may be
made anytime prior to fact finding, and has permitted the demand
to be made as late as two working days prior to the fact-finding
hearing itself. Oxford Hills Teachers Association v. MSAD No. 17
Board of Directors, No. 88-13, slip op. at 30 (Me.L.R.B. June 16,
1989.
15The Association's waiver argument was based on the vague-
ness of the City's proposal, and not on an allegation that the
proposal ceded decision-making to third parties. This omission
-25-
require the City to remove its retirement proposal from the table
unless and until the Association agrees to discuss it further. I
would also dismiss the Association's allegations regarding
surface bargaining, since it is not a violation of the MPELRL to
surface bargain over a permissive subject. A bargaining agent
(or employer) faced with surface bargaining in connection with a
permissive subject may simply demand that it be taken off the
table.
Issued at Augusta, Maine, this 15th day of February, 1995.
MAINE LABOR RELATIONS BOARD
/s/___________________________
Gwendolyn Gatcomb
Alternate Employee
Representative
__________________________
is not fatal, since the Association did raise the issue of
permissiveness based on waiver.
-26-
NOTICE TO EMPLOYEES
POSTED PURSUANT TO AN ORDER OF THE
MAINE LABOR RELATIONS BOARD
AS A RESULT OF THE FILING OF A PROHIBITED PRACTICES CASE AGAINST THE CITY
OF BANGOR, IT HAS BEEN DETERMINED THAT THE CITY HAS VIOLATED THE LAW. IN
ACCORDANCE WITH OUR INTENTION TO COMPLY WITH THE BOARD'S ORDER, YOU
ARE NOTIFIED OF THE FOLLOWING:
We will cease and desist from refusing to bargain in good faith and from
interfering with, restraining and coercing members of the City of Bangor
Firefighters' Unit by surface bargaining on the mandatory subject of employee
retirement.
We will post this notice for two weeks.
We will notify the Board of the date of posting and of compliance
with its order.
City of Bangor
Dated: ____________________________
Robert W. Farrar
Director of Administration
Any questions concerning this notice or compliance with its provisions may be
directed to:
MAINE LABOR RELATIONS BOARD
STATE HOUSE STATION 90
AUGUSTA, MAINE 04333
(207) 287-2015