State of California (Department of Personnel Administration) (Association of California State Attorneys and Administrative Law Judges and Professional Engineers in California Government; California State Employees' Association; California Department of Forestry Employees' Association, Local 2881, International Association of Fire Fighters) (PERB 1067S)

STATE 	OF 	CALIFORNIA
DECISION OF 	THE
PUBLIC 	EMPLOYMENT 	RELATIONS 	BOARD
ASSOCIATION 	OF 	CALIFORNIA 	STATE
ATTORNEYS 	AND ADMINISTRATIVE 	LAW
JUDGES 	AND 	PROFESSIONAL 	ENGINEERS
IN 	CALIFORNIA GOVERNMENT,
Charging Parties,
v.
STATE 	OF 	CALIFORNIA,
Respondent.
Case No. 	S-CE-498-S
PERB Decision No. 	1067-S
November 9, 	1994
CALIFORNIA STATE 	EMPLOYEES'
ASSOCIATION,
Charging 	Party,
v.
STATE 	OF 	CALIFORNIA 	(DEPARTMENT
OF 	PERSONNEL 	ADMINISTRATION,
Respondent.
Case No. 	S-CE-503-S
CALIFORNIA DEPARTMENT 	OF 	FORESTRY
EMPLOYEES' ASSOCIATION, 	LOCAL 2881,
IAFF,
Charging 	Party,
v.
STATE 	OF 	CALIFORNIA 	(DEPARTMENT
OF PERSONNEL ADMINISTRATION),
Respondent.
Case No. 	S-CE-506-S
Appearances: 	Dennis F. 	Moss, 	Attorney, 	for Association of
California 	State Attorneys 	and Administrative 	Law Judges 	and
Professional 	Engineers 	in California Government; 	Paul M. 	Starkey,
Labor Relations 	Counsel, 	Department 	of 	Personnel Administration
for State 	of 	California.
Before Blair, 	Chair; 	Caffrey and Garcia, 	Members.
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DECISION
CAFFREY, 	Member: 	This 	case 	is before 	the Public Employment
Relations 	Board 	(PERB or Board) 	on appeal 	by the Association of
California 	State Attorneys 	and Administrative 	Law Judges 	and
Professional 	Engineers 	in California Government 	(ACSA/PECG) 	of a
proposed decision 	(attached hereto) 	by a 	PERB 	administrative 	law
judge 	(ALJ).1 In his 	decision, 	the ALJ concluded that 	the 	State
of 	California 	(Department 	of 	Personnel Administration) 	(State)
did not violate section 3519(a), 	(b) 	and 	(c) 	of the Ralph C.
Dills Act 	(Dills Act)2 by making proposals 	to the Legislature
1The ALJ decided 	three 	consolidated 	cases 	filed by
ACSA/PECG, 	the California State Employees' 	Association 	(CSEA) 	and
the 	California Department 	of 	Forestry 	Employees Association
(CDFEA). 	The parties agreed to submit the dispute 	to the ALJ on
the basis 	of 	a 	factual 	stipulation and briefs 	filed by 	the
parties. 	CSEA and CDFEA did not 	file 	exceptions 	to 	the proposed
decision.
2The Dills Act 	is 	codified at Government 	Code 	section 	3512
et 	seq. 	Unless 	otherwise 	indicated, 	all 	statutory references
herein are to the Government Code. 	Section 3519 	states, 	in
pertinent part:
It 	shall 	be unlawful 	for 	the 	state 	to do any
of 	the 	following:
(a) 	Impose or threaten to 	impose 	reprisals
on employees, 	to discriminate or threaten to
discriminate against 	employees, 	or otherwise
to interfere with, 	restrain, 	or coerce
employees because 	of 	their exercise 	of 	rights
guaranteed by this 	chapter. 	For purposes 	of
this 	subdivision, 	"employee" 	includes an
applicant 	for 	employment 	or 	reemployment.
(b) 	Deny to employee organizations 	rights
guaranteed 	to 	them by 	this 	chapter.
(c) 	Refuse or fail 	to meet 	and confer in
good 	faith with 	a 	recognized 	employee
organization.
22

about 	bargainable 	subjects 	without 	giving prior notice 	to 	and
meeting 	and 	conferring with various 	unions 	representing 	state
employees. 	ACSA/PECG alleged 	that 	the 	State's 	actions 	were
contrary 	to 	the provisions 	of Dills Act 	sections 	3516.5 	and 	3517.3
3Dills Act 	section 3516.5 	states:
Except 	in 	cases 	of 	emergency as provided 	in
this 	section, 	the employer shall 	give
reasonable written notice 	to 	each 	recognized
employee 	organization 	affected by any 	law,
rule, 	resolution, 	or regulation directly
relating 	to matters 	within the 	scope 	of
representation proposed 	to 	be 	adopted by 	the
employer, 	and shall 	give 	such recognized
employee 	organizations 	the 	opportunity 	to
meet 	and 	confer with 	the 	administrative
officials 	or 	their 	delegated 	representatives
as 	may be 	properly 	designated by 	law.
In 	cases 	of 	emergency when 	the 	employer
determines that a law, 	rule, 	resolution, 	or
regulation must 	be 	adopted 	immediately
without 	prior notice 	or meeting with a
recognized employee organization, 	the
administrative 	officials 	or 	their delegated
representatives 	as 	may be 	properly designated
by 	law 	shall 	provide 	such notice 	and
opportunity 	to meet 	and 	confer 	in good 	faith
at 	the 	earliest 	practical 	time 	following 	the
adoption of such law, 	rule, 	resolution, 	or
regulation.
Dills Act 	section 3517 	states:
The Governor, 	or his 	representative as may be
properly designated by law, 	shall meet 	and
confer in good faith regarding wages, 	hours,
and other 	terms 	and 	conditions 	of 	employment
with 	representatives 	of 	recognized 	employee
organizations, 	and shall 	consider 	fully such
presentations 	as 	are made 	by 	the 	employee
organization on behalf 	of 	its members 	prior
to 	arriving at 	a 	determination 	of 	policy 	or
course of action.
"Meet 	and 	confer 	in good faith" 	means 	that
the Governor of 	such representatives 	as 	the
33

Governor may designate, 	and 	representatives
of 	recognized employee organizations, 	shall
have 	the mutual 	obligation personally 	to meet
and 	confer promptly upon 	request 	by 	either
party and 	continue 	for a 	reasonable 	period 	of
time 	in order to 	exchange 	freely 	information,
opinions, 	and proposals, 	and to endeavor to
reach agreement 	on matters 	within the 	scope
of 	representation prior 	to 	the 	adoption by
the 	state 	of 	its 	final budget 	for the 	ensuing
year. 	The process 	should 	include 	adequate
time 	for the resolution of 	impasses.
The 	ALJ also 	found 	that 	the 	contention 	that 	the 	State
violated 	the 	Dills 	Act 	by unilaterally 	changing 	the 	employee
pension 	plan 	represented 	an unalleged violation which 	could 	not
be 	raised by the 	charging parties. 	In its 	appeal, 	ACSA/PECG
disputes 	that 	it made 	this 	allegation and does 	not 	except 	to 	the
ALJ's 	finding.
The 	Board has 	reviewed 	the 	entire 	record 	in 	this 	case,
including the proposed decision, 	ACSA/PECG's appeal, 	the State's
response 	thereto, 	and the briefs 	filed by the parties. 	The Board
finds 	the ALJ's 	decision 	to be 	free 	of prejudicial 	error and
adopts 	it 	as 	the decision of 	the Board 	itself 	in accordance with
the 	following 	discussion.
DISCUSSION
PERB Regulation 323004 provides 	parties 	the 	opportunity 	to
4PERB 	regulations 	are 	codified at 	California 	Code 	of
Regulations, 	title 	8, 	section 31001 et seq. 	Regulation 32300
states, 	in pertinent part:
(a) 	The 	statement of exceptions 	or brief
shall:
(1) 	State the specific 	issues 	of procedure,
fact, 	law or rationale 	to which each
exception is 	taken;
(2) 	Identify the page or part 	of 	the
decision 	to which each exception 	is 	taken;
44

appeal 	an ALJ's 	proposed decision 	to 	the 	Board itself. 	In
accordance with the 	regulation, 	the appeal 	shall 	state 	"the
specific 	issues 	of procedure, 	fact, 	law or rationale 	to which
each exception 	is 	taken" 	and 	"the 	grounds 	for each exception."
(3) 	Designate by page 	citation or exhibit
number the portions 	of 	the record, 	if any,
relied upon 	for 	each 	exception;
(4) 	State 	the grounds 	for each exception.
The 	appeal 	filed by ACSA/PECG does 	not 	comply with 	the
provisions 	of 	PERB Regulation 	32300. 	ACSA/PECG 	lists 	nine
exceptions 	to 	the proposed decision, 	several 	of which merely 	take
issue 	with 	the 	wording 	chosen by 	the ALJ 	in 	framing 	the 	issues
presented by the 	case. 	These 	exceptions 	do not 	specify 	issues 	of
procedure, 	fact, 	law or rationale, 	and do not specify the grounds
for each exception. 	In effect, 	they present no exception 	for the
Board 	to 	consider.
ACSA/PECG excepts 	to 	the ALJ's 	analysis 	of 	People 	ex rel.
Seal Beach Police Officers Assn. 	v. 	City of Seal Beach 	(1984) 	36
Cal.3d 591 	[205 Cal Rptr. 	794], 	but this objection is not
accompanied by any analysis 	or 	further discussion 	and 	fails 	to
comply with 	PERB Regulation 	32300.
In the 	remainder of 	the appeal, 	ACSA/PECG repeats 	in summary
form arguments 	previously made 	to 	the ALJ, 	asserting 	that 	"the
Dills 	Act 	precludes 	the 	Governor 	from making proposals 	on
bargainable 	issues 	without 	first 	dealing with 	the 	charging
parties." 	Further, 	ACSA/PECG contends 	that 	"the Constitution
55

does 	not 	supersede 	the Governor's 	obligations 	under 	the Dills Act
when 	it 	comes 	to 	the proposal 	of 	legislation other 	than 	the
budget proposal 	itself."
While ACSA/PECG 	includes 	these 	broad assertions 	in 	its
appeal, 	it does 	not 	address 	the 	specific analysis 	included 	in the
ALJ's proposed decision. 	In his analysis, 	the ALJ cites 	specific
cases 	in which 	the 	Board has 	addressed 	itself 	to 	questions
involving 	the 	relationship 	of 	the budget 	process 	to 	collective
bargaining. 	In State 	of 	California 	(Department 	of 	Personnel)
(19 86) 	PERB Decision No. 	569-S, 	the Board considered the
circumstances 	in which the 	state 	delayed negotiations 	on 	economic
proposals 	with 	the 	exclusive 	representative 	while 	it 	pursued
negotiations with 	the 	Legislature 	as 	to 	the amount 	to be 	included
in 	the 	state budget 	to 	fund employee 	compensation. 	The 	Board
held 	that:
. 	. 	. 	an uncertain financial picture may pose
a 	serious 	impediment 	to 	fruitful 	negotiations
and 	thus 	present 	a 	legitimate basis 	for
postponing 	the 	inception of 	negotiations 	with
the 	employee 	organization. 	Awaiting 	final
budget action from the Legislature, 	under
such circumstances, 	cannot be 	said to
contravene 	[the Dills Act's] 	mandate.
In State of California, 	Department 	of 	Personnel
Administration 	(1988) 	PERB Decision No. 	706-S, 	the Board
considered 	the 	allegation 	that 	the Governor's 	submission 	of 	a
budget 	proposal 	containing 	a 	specific 	proposal 	for 	employee
compensation, 	without 	first meeting and 	conferring with the
employee 	organizations, 	constituted a Dills Act violation. 	In
dismissing the 	charge, 	the Board stated that:
6

. 	. 	. 	the Governor's proposed budget is not a
matter 	for negotiation, 	but 	is 	instead the
performance 	of 	a 	constitutionally 	imposed
duty. 	The Governor acts 	as an essential
participant 	in 	the 	legislative process,
whereby 	the 	state 	remains 	solvent 	and
operating. 	. . . 	In doing so, 	he acts 	in a
legislative 	capacity as 	part 	of 	the
legislative process which 	is 	separate 	and
apart 	from his 	responsibilities 	as 	the 	chief
executive 	and employer of 	state 	employees.
In State 	of 	California. 	Department 	of 	Personnel
Administration 	(1990) 	PERB Decision No. 	823-S, 	the Board
considered a 	circumstance 	in which 	the 	state 	delayed making 	a
firm salary proposal 	to 	the 	exclusive 	representative until 	late
August, 	weeks 	after 	the budget 	had been passed by the 	Legislature
and 	signed by 	the Governor. 	The 	Board noted 	that 	"the 	state's
obligation 	to meet 	and 	confer 	in good 	faith does 	not 	bind 	the
collective bargaining process 	to 	the budget," 	and that:
. 	. 	. 	it is not necessarily inappropriate for
the Governor's 	representative, 	as a part 	of
his 	bargaining 	strategy, 	to delay making a
firm proposal 	until 	he 	has 	had an 	opportunity
to 	review the 	final 	budget 	in good 	faith 	in
order 	to 	determine 	the 	funds 	potentially
available 	for 	salary 	increases.
These 	cases 	demonstrate 	that 	the 	Board has 	consistently
acknowledged 	the 	Governor's 	responsibilities 	relating 	to 	the
budget, 	such as 	the 	constitutional 	requirement 	that a budget be
proposed by January 	10 	each year, 	and the 	inevitable, 	subsequent
negotiations 	with 	the 	Legislature 	over 	the 	specific 	elements 	of
the 	budget, 	including 	those 	directly 	related to 	employee pay and
benefits. 	The 	Board has 	declined 	to 	find a violation of 	the
Dills 	Act 	when 	the 	January budget 	proposal 	and 	the 	subsequent
77

legislative 	negotiations 	occur prior 	to 	negotiations 	with
employee 	organizations, 	even though 	they 	involve 	issues 	which
have a direct 	impact 	on 	terms 	and 	conditions 	of 	employment 	of
bargaining unit members.
In his decision, 	the ALJ considers 	the question of whether
the proposed 	legislation at 	issue 	in 	this 	case was 	offered as
part 	of 	the budget process. 	The ALJ relies 	on Board precedent
and the parties' 	stipulation to 	conclude 	that 	the disputed
legislation was 	part 	of 	the budget process because 	it 	implemented
budget assumptions, 	resulting 	in a 	finding of no violation.
ACSA/PECG asserts 	that 	there 	is 	no 	support 	in 	the 	record or law
for 	the ALJ's 	conclusion 	"that 	the 	legislation had 	to be proposed
by 	the 	Governor and passed 	for 	the 	budget 	to be 	implemented."
The parties' 	stipulation clearly indicates 	the 	State's
position 	"that 	the proposals 	to 	the Legislature were part 	of 	the
annual 	budget process." 	ACSA/PECG offers 	no evidence 	or argument
to 	rebut 	the State's 	assertions, 	nor is any analysis 	or argument
offered with 	regard 	to 	the ALJ's 	analysis 	of 	the 	Board 	cases
cited 	in 	the proposed decision. 	The 	fact 	that 	the 	Board 	in 	these
cases 	has 	acknowledged 	the 	Governor's 	responsibilities 	with
regard to 	the budget, 	including 	the pursuit 	of 	discussions 	and
negotiations 	with 	the 	Legislature 	over pay and benefit 	levels
prior 	to meeting 	and 	conferring with 	employee 	organizations 	on
these 	subjects, 	is 	not 	referenced 	in any way by ACSA/PECG.
In sum, 	ACSA/PECG has presented an appeal 	in summary fashion
which does 	not 	comply with 	the 	requirements 	of 	PERB
8

Regulation 32300, 	failing 	to adequately address 	the 	law or
rationale 	cited by 	the ALJ 	in his 	proposed decision. 	The Board
finds 	ACSA/PECG's 	exceptions 	to be 	without 	merit 	and 	rejects
them.
ORDER
The 	complaints 	and unfair practice 	charges 	in 	Case
Nos. 	S-CE-498-S, 	S-CE-503-S 	and S-CE-506-S 	are hereby DISMISSED.
Chair Blair 	joined 	in 	this 	Decision.
Member Garcia's 	concurrence begins 	on page 	10.
99

GARCIA, 	Member, 	concurring: 	The question in this 	case 	is
whether 	the 	Governor was 	legally 	obligated under 	the 	Ralph 	C.
Dills Act 	(Dills Act) 	sections 	3516.51 and 35172 to notice a
Dills 	Act 	section 	3516.5 	provides 	that:
Except 	in 	cases 	of 	emergency as provided 	in
this 	section, 	the employer shall 	give
reasonable written notice 	to 	each 	recognized
employee 	organization 	affected by 	any 	law,
rule, 	resolution, 	or regulation directly
relating 	to matters within the 	scope 	of
representation proposed 	to 	be 	adopted by 	the
employer, 	and shall 	give 	such recognized
employee 	organizations 	the 	opportunity 	to
meet 	and 	confer with 	the 	administrative
officials 	or 	their 	delegated 	representatives
as 	may be 	properly designated by 	law.
In 	cases 	of 	emergency when the 	employer
determines that a law, 	rule, 	resolution, 	or
regulation must 	be 	adopted 	immediately
without 	prior notice 	or meeting with a
recognized employee 	organization, 	the
administrative 	officials 	or 	their 	delegated
representatives 	as 	may be 	properly designated
by 	law 	shall 	provide 	such notice 	and
opportunity to meet 	and 	confer 	in good 	faith
at 	the 	earliest 	practical 	time 	following 	the
adoption of such law, 	rule, 	resolution, 	or
regulation. 	[Emphasis added.]
2Dills Act 	section 3517 provides 	that:
The Governor, 	or his 	representative as may be
properly designated by law, 	shall meet 	and
confer in good faith regarding wages, 	hours,
and other 	terms 	and 	conditions 	of 	employment
with 	representatives 	of 	recognized 	employee
organizations, 	and shall 	consider fully such
presentations 	as 	are made by 	the 	employee
organization on behalf 	of 	its members 	prior
to arriving at 	a 	determination of 	policy 	or
course of action.
"Meet 	and 	confer 	in good 	faith" 	means 	that
the Governor or 	such 	representatives 	as 	the
Governor may designate, 	and 	representatives
of 	recognized employee organizations, 	shall
10
---------------- -- --

recognized 	employee 	organization 	on matters 	within 	scope 	prior 	to
making 	recommendations 	to 	the 	Legislature 	to 	further budget
objectives. 	The Dills Act 	sections 	cited 	could be 	interpreted 	to
conflict with the California Constitution, 	Article 4, 	section
12 (c), which provides:
have 	the mutual 	obligation personally to meet
and 	confer promptly upon 	request 	by 	either
- -party and 	continue 	for a 	reasonable period 	of
time 	in order 	to 	exchange 	freely 	information,
opinions; 	and proposals, 	and to endeavor to
reach agreement 	on matters 	within the 	scope
of 	representation prior 	to 	the 	adoption by
the 	state 	of 	its 	final 	budget 	for 	the 	ensuing
year. 	The process 	should 	include 	adequate
time 	for the 	resolution of 	impasses.
(Emphasis 	added.)
The budget 	shall 	be 	accompanied by a budget
bill 	itemizing 	recommended 	expenditures. 	The
bill 	shall 	be 	introduced 	immediately 	in 	each
house by 	the persons 	chairing 	the 	committees
that 	consider appropriations. 	The
Legislature 	shall 	pass 	the budget 	bill 	by
midnight 	on June 	15 	of 	each year. 	Until 	the
budget bill 	has been enacted, 	the 	Legislature
shall 	not 	send 	to 	the Governor 	for
consideration 	any bill 	appropriating 	funds
for expenditure 	during 	the 	fiscal 	year 	for
which the budget bill 	is 	to be 	enacted,
except 	emergency bills 	recommended by 	the
Governor 	or appropriations 	for 	the 	salaries
and expenses 	of 	the 	Legislature.
Likewise, 	the Dills Act poses a potential 	conflict with the
following 	constitutional 	provision:
Within the 	first 	10 	days 	of 	each calendar
year, 	the Governor shall 	submit 	to the
Legislature, 	with an explanatory message, 	a
budget 	for 	the 	ensuing 	fiscal 	year 	containing
itemized 	statements 	for 	recommended 	state
expenditures 	and 	estimated 	state 	revenues.
If 	recommended 	expenditures 	exceed 	estimated
revenues, 	the Governor shall 	recommend the
sources 	from which 	the 	additional 	revenues
11

should be provided. 	[Id.. 	Art. 	4, 	sec.
12 (a) .]
It 	is 	a fundamental 	rule 	of 	statutory construction that a
statute should be construed, 	if possible, 	to preserve its
constitutionality,3 and 	construed 	so 	that 	it may be given effect
rather 	than 	invalidated.4 A court 	seeking 	to 	interpret 	a 	statute
should ascertain 	the 	intent 	of 	the 	Legislature 	so as 	to
effectuate the purpose of 	the law; 	moreover, 	every statute should
be 	construed with reference 	to 	the whole 	system of 	law of 	which
it 	is 	a part 	so 	that 	all may be harmonized and have 	effect.5
Using 	these 	rules 	of 	construction to 	interpret 	the Dills Act
sections 	so as 	to avoid conflict with the Constitution, 	it 	is
apparent 	from the 	face 	of 	the 	statutes 	that 	they do not 	contain
requirements 	of prior notice 	in this 	context, 	nor do they pertain
to budget proposals 	to the Legislature. 	Therefore, 	the 	statute
cannot be 	read 	to 	require meeting and 	conferring before 	the
adoption of 	a law, 	since 	the Governor cannot unilaterally adopt a
law.
The meet 	and 	confer process 	identified 	in 	section 	3517
reflects 	the 	legislative 	intent 	to 	instill 	prompt 	and 	flexible
timelines; 	however, 	to read that section as requiring prior
notice and meet 	and 	confer 	sessions 	in advance 	of budget
3Hooper v. 	Deukmeiian 	(1981) 	122 	Cal.App.3d 987
-[176 Cal.Rptr. 569].
4San Bernardino 	Fire 	& Police 	Protective League v. 	City of
San Bernardino 	(1962) 	199 Cal.App.2d 401 	[18 Cal.Rptr. 	757].
5In re Ruben M. 	(1979) 	96 	Cal.App.3d 690 	[158 	Cal.Rptr.
197] .
12

proposals 	would 	erect 	a hurdle 	to be 	cleared before 	the Governor
can proceed to meet 	the 	constitutional mandate. 	There 	is 	no
clear statement 	in the 	statute 	that 	reflects 	such an intent, 	so
we adopt 	the 	interpretation 	that 	is 	in harmony with 	the
Constitution.
Furthermore, 	the realities 	of 	the budget process 	allow for
adequate 	notice 	and 	opportunities 	for 	interested parties 	to
negotiate 	with 	the Governor and 	the 	Legislature 	prior 	to 	the
adoption of 	laws 	connected with 	the passage 	of 	a budget.
13

STATE 	OF 	CALIFORNIA
PUBLIC 	EMPLOYMENT 	RELATIONS 	BOARD
ASSOCIATION OF 	CALIFORNIA STATE
ATTORNEYS 	AND ADMINISTRATIVE 	LAW
JUDGES 	and 	PROFESSIONAL 	ENGINEERS
IN 	CALIFORNIA GOVERNMENT,
Charging 	Parties,
v.
STATE 	OF 	CALIFORNIA,
Respondent.
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Case No. 	S-CE-498-S
CALIFORNIA STATE 	EMPLOYEES
ASSOCIATION,
Charging 	Party,
v.
STATE 	OF 	CALIFORNIA 	(DEPARTMENT
OF PERSONNEL ADMINISTRATION),
Respondent.
Unfair 	Practice
Case No. 	S-CE-503-S
CALIFORNIA DEPARTMENT 	OF 	FORESTRY
EMPLOYEES' ASSOCIATION, 	LOCAL 2881,
IAFF,
Charging 	Party,
v.
STATE 	OF 	CALIFORNIA 	(DEPARTMENT
OF PERSONNEL ADMINISTRATION),
Respondent.
Unfair 	Practice
Case No. 	S-CE-506-S
PROPOSED 	DECISION
(3/11/94)
Appearances; 	Dennis F. 	Moss, 	Esq., 	for Association of California
State 	Attorneys 	and Administrative 	Law Judges 	and 	Professional
Engineers 	in California Government; 	Howard Schwartz, 	Esq.,
Assistant 	Chief 	Counsel, 	for California State Employees'
Association; 	Carroll, 	Burdick & McDonough by Ronald Yank,
Esq.,for 	California Department 	of 	Forestry Employees'
Association, Local 288,1, 	IAFF.
This proposed decision has been appealed to the
Board itself and may not be cited as precedent
unless the decision and its rationale have been
adopted by the Board.
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Before Ronald E. 	Blubaugh, 	Administrative Law Judge.
PROCEDURAL 	HISTORY
These 	consolidated 	cases 	raise 	the 	novel 	question 	of 	whether
the Dills 	Act 	bars 	the Governor 	from making pre-negotiations
proposals 	to the Legislature about bargainable 	subjects. 	The
four unions 	that 	brought 	these 	actions 	contend 	that 	the 	law has
just 	such an effect. 	The 	State 	of 	California 	(State) 	replies
that 	such a 	reading 	of 	the 	law would run counter 	to 	the 	rules 	of
statutory 	construction and 	interfere 	with 	constitutional 	powers
of 	the Governor and Legislature.
These 	cases were born 	in a 	contentious 	round of bargaining
that 	took place 	in 	1991 	and 1992 	between the 	State and 	the unions
that 	represent 	the State's 	organized workers. 	The earliest 	of
the charges at issue, 	S-CE-498-S, 	was filed on June 24, 	1991, 	by
the Association of 	California State Attorneys 	and Administrative
Law Judges 	(ACSA) 	and the 	Professional 	Engineers 	in California
Government 	(PECG). 	There 	followed S-CE-503-S, 	filed on July 10,
1991, 	by the California State Employees' 	Association 	(CSEA), 	and
S-CE-506-S, 	filed on July 16, 	1991, 	by the California Department
of Forestry Employees' Association, 	Local 2881, 	IAFF 	(CDFEA).
The general 	counsel 	of 	the 	Public 	Employment 	Relations 	Board
(PERB or Board) 	issued complaints 	against 	the State 	in each 	case.
The 	complaint 	in S-CE-498-S was 	issued on June 27, 	1991, 	followed
by the 	complaint 	in case S-CE-503-S, 	issued on July 	16, 	and the
complaint 	in case 	S-CE-508-S, 	issued on August 	23.
N	2

The 	three 	complaints 	are 	closely parallel. 	Each alleges
that 	the 	State was 	in violation of Ralph C. 	Dills Act 	section
3519 (c) 	and, 	derivatively, 	(a) 	and 	(b)1 by proposing changes in
laws 	before 	giving 	notice 	to 	and meeting 	and 	conferring with 	the
unions. 	Specifically, 	the 	complaints 	in cases 	S-CE-498-S 	and
S-CE-506-S 	allege 	that:
During May 	and 	June 	1991 	Respondent 	proposed
laws 	to 	the 	Legislature 	concerning matters
within 	the 	scope 	of 	representation defined 	in
Government 	Code 	section 3516, 	including but
not 	limited to 	reduced pay, 	furlough of
Respondent's employees, 	and elimination of
one 	tier of 	the 	retirement 	system.
The 	complaint 	in 	case 	S-CE-503-S 	lists 	"merit 	salary adjustments
and 	furlough of 	Respondent's 	employees" 	as 	the 	subjects 	discussed
with 	the 	Legislature before bargaining.
1 Unless otherwise 	indicated, 	all 	statutory references 	are 	to
the Government Code. 	The Ralph C. 	Dills Act 	(Dills Act) 	is
codified at 	Government 	Code 	section 3512 	et 	seq. 	In 	relevant
part, 	section 3519 provides as follows:
It 	shall be unlawful 	for the 	state 	to do any
of 	the 	following:
(a) 	Impose or threaten to 	impose 	reprisals
on employees, 	to discriminate or threaten to
discriminate against 	employees, 	or otherwise
to interfere with, 	restrain, 	or coerce
employees 	because 	of 	their exercise 	of 	rights
guaranteed by this 	chapter. 	For purposes 	of
this subdivision, 	"employee" 	includes an
applicant 	for 	employment 	or 	reemployment.
(b) 	Deny to employee organizations 	rights
guaranteed 	to 	them by 	this 	chapter.
(c) 	Refuse 	or 	fail 	to meet 	and confer in
good 	faith with 	a 	recognized 	employee
organization.
W3

A hearing 	in 	case 	S-CE-498-S 	was 	commenced 	on August 	8,
1991, 	before Administrative Law Judge 	Fred D'Orazio. 	At 	the
hearing, 	the 	State 	refused 	to 	comply with subpoenas 	for 	records
and witnesses. 	ALJ D'Orazio 	concluded 	that 	the 	subpoenas 	should
be 	enforced and adjourned 	the 	hearing 	so 	that 	the 	general 	counsel
of 	the 	PERB might 	seek enforcement. 	The 	Sacramento 	Superior
Court 	denied 	enforcement 	but 	the 	PERB 	took 	the matter 	to 	the
Court 	of Appeal 	where a writ 	of mandate was 	issued directing 	the
trial 	court 	to enforce the 	subpoenas.2
Following the decision of 	the Court 	of Appeal, 	the 	three
cases 	were 	consolidated and 	the parties 	agreed 	to 	submit 	the
dispute on the basis 	of a 	factual 	stipulation. 	With the 	filing
of briefs, 	the matter was 	submitted 	for decision on March 	8,
1994.3
FINDINGS 	OF 	FACT
The joint stipulation, 	which reads as 	follows, 	comprises 	the
findings 	of 	fact:
Charging 	Parties 	Association 	of 	California 	State 	Attorneys
and Administrative Law Judges, 	Professional 	Engineers 	in
California Government, 	California Department 	of 	Forestry
Employees' 	Association, 	Local 2881, 	IAFF, 	and California State
2Public 	Employment Relations 	Board v. 	The 	Superior Court 	of
Sacramento County 	(1993) 	13 	Cal.App.4th 1816 	[17 	Cal.Rptr.2d
323] .
3Prior 	to 	the 	completion of briefing, 	ALJ D'Orazio announced
his 	resignation 	from employment with the 	PERB. 	The matter was
reassigned to 	the undersigned pursuant 	to 	California 	Code 	of
Regulations, 	title 8, 	section 32168(b).
44

Employees' 	Association, 	and Respondent State Employer State of
California, 	jointly stipulate and agree 	that 	the above-entitled
cases, 	S-CE-498-S, 	S-CE-503-S, 	and S-CE-506-S, 	have common issues
of 	fact 	and law, 	such that 	the 	following 	factual 	stipulations 	are
made 	for and concerning each of 	these 	cases. 	This 	stipulation
derives 	from the allegations 	of 	the 	complaints 	on 	file herein,
except as 	to paragraph 6, 	which is a matter of 	judicial 	notice.
1. 	Charging 	Parties 	are 	recognized employee 	organizations
within the meaning of Government 	Code 	section 3513(b) 	of
appropriate units 	of 	employees.
2. 	Respondent 	is 	the 	state 	employer within the meaning of
Government Code section 3513 (j).
3. 	S-CE-498-S. 	S-CE-503-S. 	S-CE-506-S: 	During May and
June 	1991, 	Respondent proposed legislation to the 	Legislature
concerning matters 	affecting 	terms 	and 	conditions 	of 	employment
of 	employees 	in the bargaining units 	represented by Charging
Parties, 	including but not 	limited to reduced pay, 	furlough of
Respondent's 	employees and elimination of 	one 	tier of 	the
retirement 	system. 	Respondent 	participated 	in discussions 	with
representatives 	of 	the Legislature 	that 	resulted 	in a basis 	for
proposed 	legislation 	for 	repeal 	of 	pre-funded 	IDDA 	[Investment
Dividend Disbursement 	Account] 	and 	EPDA 	[Extraordinary
Performance Dividend Account] 	benefits 	and, 	direction of 	IDDA and
EPDA reserves 	to be 	used to 	reduce 	employer pension
contributions, 	and transfer of 	PERS 	[Public Employees' 	Retirement
System] 	actuarial 	responsibilities.
55

4. 	Respondent 	did not 	give 	Charging 	Parties 	written 	notice
or 	an 	opportunity 	to 	meet 	and 	confer 	with 	Respondent's 	officials
or 	their 	delegated 	representatives 	prior 	to 	taking 	the 	action
described 	in 	paragraph 	3.
5. 	If 	called to 	testify, 	representatives 	of 	the 	Respondent
would 	testify 	that 	the proposals 	to 	the 	Legislature 	were 	part 	of
the 	annual 	budget process.
6. 	Assembly Bill 	702 	(AB 702) 	(Stats. 	1991, 	Chap. 	83) 	was
enacted, 	effective June 	30, 	1991. 	The Bill 	encompassed certain
of 	the proposals 	referenced 	in paragraph 	3 	above.
LEGAL 	ISSUES
1) 	Did the 	State 	fail 	to meet 	and confer 	in good 	faith 	in
violation of 	section 3519(c) 	and derivatively 	(a) 	and 	(b) 	by
making 	pre-negotiations 	proposals 	to 	the 	Legislature 	about
bargainable 	subjects?
2) 	Did 	the 	State 	fail 	to meet 	and 	confer 	in good 	faith 	in
violation of 	section 3519(c) 	and, 	derivatively, 	(a) 	and 	(b) 	by
making 	a 	unilateral 	change 	in 	the 	employee 	pension program?
CONCLUSIONS 	OF 	LAW
Pre-negotiations 	Proposals
Under the Dills Act, 	the 	State 	is 	required 	to give 	exclusive
representatives 	notice 	and 	the 	opportunity 	to meet 	and 	confer
before 	adopting 	any 	change 	in a 	negotiable matter.4 The 	Governor
4 Dills Act 	section 3516.5 	provides 	as 	follows:
Except 	in 	cases 	of 	emergency as 	provided 	in
this 	section, 	the 	employer shall 	give
reasonable 	written 	notice 	to 	each 	recognized
66

is obligated, 	furthermore, 	to 	"consider fully" 	any presentations
made by 	representatives 	of 	employee 	organizations 	"prior 	to
arriving 	at 	a determination of policy or course 	of 	action."5
employee 	organization 	affected by 	any 	law,
rule, 	resolution, 	or regulation directly
relating 	to matters within the 	scope 	of
representation proposed 	to be 	adopted by 	the
employer, 	and shall 	give 	such recognized
employee 	organizations 	the 	opportunity 	to
meet 	and 	confer with 	the 	administrative
officials 	or 	their 	delegated 	representatives
as 	may be 	properly 	designated by 	law.
In 	cases 	of 	emergency when the 	employer
determines that a law, 	rule, 	resolution, 	or
regulation must 	be 	adopted 	immediately
without 	prior notice 	or meeting with a
recognized employee 	organization, 	the
administrative 	officials 	or 	their 	delegated
representatives 	as 	may be 	properly 	designated
by 	law shall provide 	such notice 	and
opportunity 	to meet 	and 	confer 	in good 	faith
at 	the 	earliest 	practical 	time 	following 	the
adoption of such law, 	rule, 	resolution, 	or
regulation.
5Dills Act 	section 3517 provides as 	follows:
The Governor, 	or his 	representative as may be
properly designated by law, 	shall meet 	and
confer in good faith regarding wages, 	hours,
and 	other 	terms 	and 	conditions 	of 	employment
with 	representatives 	of 	recognized 	employee
organizations, 	and shall 	consider 	fully such
presentations 	as 	are made by 	the 	employee
organization on behalf 	of 	its members prior
to 	arriving at 	a 	determination of 	policy 	or
course of action.
"Meet 	and 	confer 	in good 	faith" 	means 	that
the Governor or 	such 	representatives 	as 	the
Governor may designate, 	and representatives
of 	recognized employee 	organizations, 	shall
have 	the mutual 	obligation personally 	to meet
and 	confer promptly upon 	request 	by 	either
party and 	continue 	for a 	reasonable period of
time 	in order 	to 	exchange 	freely 	information,
opinions, 	and proposals, 	and to endeavor to
77

Such meeting 	and 	conferring 	as 	may be 	undertaken by 	the 	Governor
and 	representatives 	of 	employee 	organizations 	shall 	be 	in 	"good
faith."
reach agreement 	on matters 	within 	the 	scope
of 	representation prior 	to 	the 	adoption by
the 	state 	of 	its 	final 	budget 	for the ensuing
year. 	The process 	should 	include 	adequate
time 	for the 	resolution of 	impasses.
The unions 	find 	"an undeniable violation" 	of 	sections 	3516,5
and 3517. 	"The 	conduct 	of going to 	the Legislature with the
subject 	ideas 	and proposals, 	without meeting and 	conferring with
the Charging Parties 	first, 	is violative of 	the express 	language
of both provisions," 	ACSA, 	PECG, 	CSEA and CDFEA argue 	in a joint
brief. 	The unions observe that the wages, 	furloughs, 	pensions,
pension 	fund administration and elimination of 	one 	tier of 	the
retirement plan are 	all 	subjects within the 	scope 	of
representation.6 Since 	the 	State 	admits 	that 	it 	discussed 	these
subjects 	with 	the 	Legislature before bargaining, 	the unions
continue, 	a violation is 	"undeniable."
The 	State 	sets 	out 	a 	lengthy argument 	based upon 	statutory
interpretation and constitutional 	analysis. 	The 	State argues
that 	the 	section 	3516.5 	requirement 	of 	advance 	notice applies
6The Dills Act 	scope 	of 	representation is 	set 	out 	in
section 3516. 	It provides as 	follows:
The 	scope 	of 	representation shall 	be 	limited to
wages, 	hours, 	and other terms and conditions of
employment, 	except, 	however, 	that the scope of
representation 	shall 	not 	include 	consideration of
the merits, 	necessity, 	or organization of any
service 	or 	activity provided by 	law or 	executive
order.
8

only 	to actions 	which 	the 	Governor 	can 	take without 	legislative
concurrence. 	Thus, 	on its face, 	the State contends, 	the Dills
Act 	does 	not 	apply 	to a Governor's proposals 	to enact 	or 	change 	a
law because 	the Governor, 	alone, 	cannot 	enact or change a law.
Legislative 	cooperation is 	required. 	In addition, 	the State
continues, 	the Dills Act 	cannot be 	read to 	interfere with the
plenary power of 	the 	Legislature 	to enact 	laws. 	The
interpretation the unions would give 	to the 	statute, 	the State
contends, 	would interfere with the 	constitutional powers 	of 	the
Legislature, 	an absurd result 	in the State's view.
While novel, 	the 	contentions made by the unions here are not
entirely unfamiliar. 	Similar arguments 	have been advanced by
ACSA and CSEA in a 	series 	of 	cases 	testing 	the 	relationship
between bargaining and the 	State budgetary process. 	The 	PERB has
held 	in 	these 	cases 	that 	collective bargaining has 	no 	necessary
linkage with the 	State budgetary process. 	The 	two activities 	can
take place 	at 	the 	same 	time 	and no 	resolution of 	collective
bargaining 	is 	required before 	introduction 	or approval 	of 	the
budget.
Thus 	the 	Board has 	recognized 	that 	"[n]egotiations 	[by 	the
Governor] 	with the employees' 	representatives and with the
Legislature may and 	often do 	occur 	simultaneously." 	(State 	of
California 	(Department of 	Personnel Administration) 	(1986) 	PERB
Decision No. 	569-S.) 	The measurement 	of whether the Governor
negotiated 	fairly is 	not 	the 	sequence 	of 	the 	State's 	proposals,
but 	whether 	the 	State's 	conduct 	"runs 	afoul 	of 	traditional
9

standards 	used 	to 	determine 	whether a party has 	acted 	in bad
faith." 	(Ibid.) 	That 	is, 	whether the negotiations were
"conducted 	in 	such a manner 	that, 	based on 	the 	totality of
circumstances, 	it 	is 	apparent 	that 	the party possessed the
subjective 	intent 	to 	reach an agreement." 	(Ibid.)
Similarly, 	the Governor does not 	fail 	to meet and confer
in good 	faith 	through 	the act 	of 	submitting a budget 	to 	the
Legislature 	prior 	to meeting 	and 	conferring with 	State 	employee
unions. 	The 	submission of 	a proposed budget 	"is not 	a matter
for negotiations, 	but 	is 	instead the performance of a
constitutionally 	imposed 	duty."7 (State 	of 	California
(Department 	of 	Personnel Administration) 	(1988) 	PERB Decision
No. 	706-S.) 	Nor does 	the State commit a per se violation of 	its
duty 	to meet 	and 	confer 	in good 	faith by 	delaying 	a 	firm salary
7Article 	IV, 	section 12 	of 	the California Constitution
provides 	in relevant part as 	follows:
(a) 	Within the 	first 	10 days 	of each
calendar year, 	the Governor shall 	submit 	to
the Legislature, 	with an explanatory message,
a budget 	for the 	ensuing 	fiscal 	year
containing 	itemized 	statements 	for
recommended 	state 	expenditures 	and 	estimated
state 	revenues. 	If 	recommended expenditures
exceed estimated revenues, 	the Governor shall
recommend 	the 	sources 	from which 	the
additional 	revenues 	should be 	provided.
(c) 	The budget 	shall be accompanied by a
budget 	bill 	itemizing 	recommended
expenditures. 	The bill 	shall be 	introduced
immediately 	in 	each house by 	the persons
chairing 	the 	committees 	that 	consider
appropriations. . . .
10

proposal 	until 	after the adoption of 	the State budget. 	(State of
California 	(Department of 	Personnel Administration) 	(1990) 	PERB
Decision No. 	823-S.) 	The measurement 	of good faith, 	the Board
again observed, 	is 	the 	totality of 	the 	circumstances 	and not 	the
timing of 	the 	salary proposal.
In its present posture, 	however, 	this 	case is not premised
on the 	totality of 	the 	circumstances. 	The 	totality of 	the
circumstances 	surrounding 	the 	1991 	round 	of 	bargaining between
the 	State 	and 	its 	unions 	was 	reviewed and 	resolved 	long ago.8
The 	complaint 	and 	stipulation base 	the 	present 	dispute 	solely on
per 	se 	theories 	which 	require 	no 	showing 	of 	subjective bad 	faith.
Thus, 	the question here 	is whether the Governor failed to meet
and 	confer 	in 	good 	faith 	solely by 	taking 	to 	the 	Legislature
pre-negotiations 	proposals 	about 	negotiable 	subjects.
The 	Board already has 	concluded 	that 	the Governor does 	not
fail 	to meet 	and 	confer 	in good 	faith by preparing a 	State budget
prior to negotiations with State employee unions. 	Yet 	it 	is
obvious 	that 	a Governor's 	budget 	is 	based upon a 	set 	of
estimates, 	calculations 	and decisions 	about 	revenue and spending.
A Governor 	could not 	assemble 	a budget 	without 	including 	an
amount 	for 	the pay and benefits 	of 	State 	employees. 	Such an
estimate 	implicitly 	includes 	a preliminary decision 	about 	whether
State 	employee 	pay and benefits 	will 	change 	in 	the budgetary year
and, 	if 	so, 	by what amount. 	Although pay and benefits are
8See administrative law judge decisions, 	H0-U-495-S,
HO-U-497-S, 	HO-U-500-S and HO-U-505-S.
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plainly negotiable 	subjects, 	the Board has 	held 	that 	the
Governor's 	initial 	determination may be made 	for budgetary
purposes 	prior 	to negotiations.
It 	is but 	a 	short 	step 	from that 	conclusion to 	the 	further
conclusion 	that 	as 	part 	of 	the budgetary process 	the 	Governor
also may 	seek 	introduction 	of 	legislation 	to 	implement 	budget
assumptions. 	If 	the budget assumes 	a change 	in State 	employee
benefits, 	proposing 	legislation to 	implement 	that 	change 	is
inherently a part 	of 	the budgetary process. 	Since 	only members
of 	the 	legislative branch can introduce 	legislation, 	the Governor
or 	the 	Governor's 	representative plainly will 	have 	to have
discussions with members 	of 	the 	Legislature as 	part 	of 	the
budgetary process.
Nor 	is 	there 	anything untoward about 	the pre-negotiations
timing 	of 	such 	legislative proposals. 	Legislation to 	enact
the Governor's budget 	decisions 	simply becomes part 	of 	the
simultaneous 	negotiations 	which 	the 	Governor 	conducts 	with 	the
unions 	and the Legislature. 	(See generally, 	State 	of 	California
(Department of Personnel Administration), 	supra, 	PERB Decision
No. 	569-S.) 	Language 	in the proposed legislation can be modified
later 	to 	encompass 	any agreements 	that 	are 	reached 	in 	the
simultaneous 	negotiations.
In their reply brief, 	the unions 	argue 	that 	the 	timing of
the 	disputed 	legislation was 	such 	that 	it 	could not 	have been a
part 	of 	the Governor's budgetary preparation. 	The unions 	note
that 	although the budget must be presented 	in January 	it was 	not
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until 	May and June 	that 	the 	Governor discussed 	the 	contested
legislation with members 	of 	the Legislature. 	Legislation
proposed 	in May and June, 	the unions 	reason, 	could not have been
part 	of 	the 	January budget 	preparation.
This 	argument 	is 	defeated by the 	factual 	stipulation. 	The
unions 	joined 	in the 	stipulation that, 	if 	called as witnesses,
representatives 	of 	the Governor would 	testify 	that 	the proposals
were made 	to 	the Legislature as part 	of 	the budget process.
There 	is 	nothing else 	in 	the 	record 	to 	rebut 	this 	stipulated
testimony. 	The 	stipulation therefore 	leads 	to a 	finding 	that 	the
disputed legislation, 	despite 	its 	timing, 	was 	intended to
implement 	budget proposals.
Accordingly, 	I 	conclude 	that no per se violation can be
found 	in 	the Governor's 	pre-negotiations 	discussions 	with members
of 	the 	Legislature 	about 	reduced pay and 	furlough of 	State
employees, 	elimination of 	one 	tier of 	the 	retirement 	system,
proposed 	legislation 	for 	repeal 	of 	the 	pre-funded 	IDDA and 	EPDA
benefits, 	use 	of 	IDDA and EPDA reserves 	to 	reduce 	employer
pension contributions, 	and transfer of 	PERS 	actuarial
responsibilities. 	Evidence of 	such discussions might, 	under some
circumstances, 	be appropriate 	to evaluate 	the totality of 	the
circumstances. 	But 	since there 	is no surface bargaining
allegation here 	and 	the 	contentions 	are 	insufficient 	to 	establish
a per 	se violation, 	no violation can be 	found.
A contrary 	result 	is 	not 	dictated by 	the 	Supreme 	Court's
decision 	in People 	ex rel. 	Seal 	Beach Police 	Officers Association
13

et al. 	v. 	City of Seal Beach 	(1984) 	36 Cal.3d 591 	[205 	Cal.Rptr.
794]. 	There, 	the Supreme Court held that a city council was
required 	to meet 	and 	confer with a 	union 	representing police
officers 	prior 	to placing 	on the ballot 	certain 	changes 	in the
city's 	charter. 	The 	changes 	affected matters within 	the 	scope 	of
bargaining under 	the Meyers-Milias-Brown Act 	(Government 	Code
section 3500 	et 	seq.). 	The court held that 	the bargaining
requirement 	did not 	abridge 	the 	city 	council's 	ultimate 	authority
under California Constitution Article XI, 	section 3(b) 	to propose
charter amendments. 	This 	is because 	the 	council 	retained the
ultimate 	authority 	to go 	to 	the people after an 	impasse 	in
bargaining.
But 	unlike 	the 	constitutional 	provisions 	affecting 	changes
in local 	government 	charters, 	the 	constitutional provisions
concerning 	the 	State budget 	set 	specific 	time 	lines. 	The
Governor must 	go 	forward with a budget 	proposal 	"within 	the 	first
10 days of each calendar year." 	(Cal. 	Const. Art. 	IV, 	sec.
12(a).) 	The 	constitutional 	budget proposal 	date 	occurs 	prior 	to
the 	commencement 	of bargaining between the State and 	its unions.
Thus, 	under the Constitution the Governor, 	unlike a city council,
cannot wait 	until 	the 	completion of 	negotiations prior to making
the 	initial 	decisions 	that 	comprise 	a budget 	proposal.
Unilateral 	Change
For the 	first 	time, 	the unions 	here 	set 	out an allegation
that 	the 	State 	failed 	to meet 	and 	confer 	in good 	faith by making
unilateral 	changes 	in the 	employee pension plan. 	This 	contention
14

is based upon paragraph 6 	of 	the stipulation, 	that Assembly-
Bill 	702 was enacted effective June 30, 	1991. 	There is no
allegation of unilateral 	change 	in any of 	the 	three unfair
practice 	charges 	or complaints 	that 	gave 	rise 	to 	this 	action.
Nevertheless, 	the unions urge 	that 	"a clear fait accompli
[was] 	presented to the Charging 	Parties 	in regards 	to 	the
elimination of 	one 	tier of 	the 	retirement plan, 	and the
elimination of 	IDDA-EPDA benefits." 	Citing 	People 	ex rel. 	Seal
Beach Police Officers Association et al. 	v. 	City of Seal Beach.
supra. 	36 	Cal.3d 591, 	the unions argue that 	since the Governor
did not meet 	and 	confer before 	enactment 	of 	the 	legislation, 	the
legislation 	is 	invalid. 	They ask 	that 	it 	therefore be 	set 	aside
and 	the 	prior pension program be 	reinstated.
"[U]nalleged violations may be entertained 	. 	. 	. 	only when
adequate 	notice 	and 	the 	opportunity 	to 	defend has 	been provided
[to] 	the 	respondent, 	and where such acts are 	intimately related
to the 	subject matter of 	the 	complaint, 	are part of 	the same
course 	of 	conduct, 	have been fully litigated, 	and the parties
have 	had 	the 	opportunity 	to 	examine 	and be 	cross-examined 	on 	the
issue." 	(Tahoe-Truckee Unified School District 	(1988) 	PERB
Decision No. 	668.) 	"The 	failure 	to meet 	any of 	the above-listed
requirements 	will 	prevent 	the 	Board 	from 	considering 	unalleged
conduct as violative 	of 	the Act." 	(Ibid.)
Two 	of 	the 	three unfair practice 	charges at 	issue here were
filed after the enactment of Assembly Bill 	702 	on June 30, 	1991.
Yet 	the 	enactment 	of 	the 	law was 	not 	challenged 	in either of
15

those 	charges. 	Nor at any 	time 	during 	the 	six months 	following
the 	enactment 	of 	the 	law did any of 	the 	charging parties move 	to
amend 	their 	charges 	or the 	complaints 	to 	reflect 	the 	final
legislative 	action. 	The 	first mention of 	the 	legislative 	action
came more 	than 	two years 	later 	in the 	factual 	stipulation.
Plainly, 	unilateral 	change 	is 	a new theory and the State was 	not
given previous 	notice 	and opportunity to defend against 	it. 	Nor
did any 	of 	the parties 	have 	an 	opportunity 	to 	examine 	and be
cross-examined 	on 	the 	question.
It 	is 	clear, 	moreover, 	that although enactment of Assembly
Bill 	702 	was part 	of 	the 	same 	course 	of 	conduct 	set 	out 	in the
complaint, 	the 	legality of 	the 	legislative action has 	not been
fully litigated. 	In a unilateral 	change 	case, 	the 	challenged act
of 	the 	employer must be measured against 	the past practice 	or
status 	quo.9 But 	the 	record here 	is 	devoid of 	information about
the past practice 	on changes 	in the pension plan. 	It 	is unknown
whether the 	1991 	legislation was 	the 	first 	time 	the 	State has
revised the pension plan or whether 	there 	is 	a history of
unilateral 	revisions 	of 	the pension plan. 	If 	the State has a
history of unilateral 	revisions, 	there 	is no evidence about
whether the 	changes 	set 	out 	in Assembly Bill 	702 	amounted 	to a
9"[T]he 	'status 	quo' 	against which an employer's 	conduct 	is
evaluated must 	take 	into 	account 	the 	regular and 	consistent 	past
patterns 	of 	changes 	in the 	conditions 	of 	employment." 	(Pajaro
Valley Unified School District 	(1978) 	PERB Decision No. 	51.)
Where 	an employer's 	action 	is 	consistent with the past practice,
no violation will 	be 	found 	in a 	change 	that 	does 	not 	alter the
status quo. 	(Oak Grove School District 	(1985) 	PERB Decision
No. 	503.)
16

change 	in 	"quantity and kind" 	from the prior 	changes. 	(Oakland
Unified School District 	(1983) 	PERB Decision No. 	367.)
In the absence of 	evidence about 	the past practice, 	there 	is
no way on 	this 	record 	to 	determine whether 	enactment 	of Assembly
Bill 	702 	constituted a change 	in the 	status 	quo. 	The 	stipulation
thus 	does 	not 	approach the 	factual 	showing 	required 	in a 	"fully
litigated" 	unilateral 	change 	case.
Accordingly, 	I 	find that 	the 	contention that 	the State
failed 	to meet 	and 	confer 	in good 	faith when 	it 	unilaterally
changed 	the 	pension plan 	is 	an unalleged violation which may 	not
be 	raised here.
PROPOSED 	ORDER
Based upon 	the 	foregoing 	findings 	of 	fact 	and 	conclusions 	of
law and the 	entire 	record 	in this matter, 	unfair practice 	charges
S-CE-498-S, 	Association of 	California State Attorneys 	and
Administrative Law Judges et al. 	v. 	State of California
(Department of Personnel Administration); 	S-CE-503-S, 	California
State Employees' 	Association v. 	State of 	California 	(Department
of Personnel Administration); 	and S-CE-506-S, 	California
Department of Forestry Employees' 	Association, 	Local 2881. 	IAFF
v. 	State 	of 	California 	(Department 	of 	Personnel 	Administration)
and 	their 	companion 	PERB 	complaints 	are 	hereby DISMISSED.10
10Since 	this 	dispute 	can be 	resolved under 	existing 	PERB
precedent, 	I 	find 	it unnecessary to 	consider the 	statutory
interpretation 	and 	constitutional 	arguments 	advanced by 	the
State. 	I 	defer the State's 	arguments 	to 	consideration in a 	case
where 	they are unavoidable, 	should such a 	case 	ever arise.
17

Pursuant 	to California Code of Regulations, 	title 	8,
section 	32305, 	this 	Proposed Decision and Order 	shall 	become
final 	unless 	a party 	files 	a 	statement 	of 	exceptions with the
Board 	itself 	at 	the headquarters 	office 	in Sacramento within 2 0
days 	of 	service of 	this Decision. 	In accordance with PERB
Regulations, 	the 	statement 	of 	exceptions 	should 	identify by page
citation or exhibit number the portions 	of 	the 	record, 	if any,
relied upon for such exceptions. 	(See Cal. 	Code of Regs.,
tit. 	8, 	sec. 	32300.) 	A document is considered 	"filed" 	when
actually received before 	the 	close 	of business 	(5:00 	p.m.) 	on 	the
last day set 	for filing 	". 	. 	. o r when sent by telegraph or
certified or Express 	United States mail, 	postmarked not 	later
than the 	last 	day set 	for 	filing 	. . . " 	(See Cal. 	Code of Regs.,
tit. 	8, 	sec. 	32135; 	Code Civ. 	P r o c , 	sec. 	1013 shall apply.) 	Any
statement 	of 	exceptions 	and 	supporting brief must 	be 	served
concurrently with 	its 	filing upon 	each party to 	this 	proceeding.
Proof 	of 	service 	shall 	accompany each 	copy 	served 	on a party 	or
filed with the Board itself. 	(See Cal. 	Code of Regs., 	tit. 	8,
secs. 	32300, 	32305 and 32140.)
Ronald E. 	Blubaugh
Administrative 	Law Judge
18