State of California (Department of Personnel Administration) (PERB 0569S)

STATE 	OF 	CALIFORNIA
DECISION 	OF 	THE
PUBLIC 	EMPLOYMENT 	RELATIONS 	BOARD
ASSOCIATION 	OF 	CALIFORNIA 	STATE
ATTORNEYS 	AND 	ADMINISTRATIVE 	LAW
JUDGES,
Charging 	Party,
v.
STATE 	OF 	CALIFORNIA 	(DEPARTMENT
OF PERSONNEL ADMINISTRATION),
Respondent.
Case 	No. 	S-CE-184-S
PERB Decision No. 	569-S
April 30, 	1986
Appearances: 	Ernest 	F. 	Schulzke, 	Attorney for Association 	of
California 	State 	Attorneys 	and 	Administrative 	Law Judges;
Christopher W. 	Waddell, 	Attorney for 	State of California
(Department of Personnel Administration).
Before Hesse, 	Chairperson; 	Morgenstern and Burt, 	Members.
DECISION
MORGENSTERN, 	Member: 	This 	case 	comes 	before 	the Public
Employment 	Relations 	Board 	(PERB or 	Board) 	on exceptions 	taken
by 	the 	Association 	of 	California 	State 	Attorneys 	and
Administrative 	Law judges 	(ACSA) 	to 	a proposed 	decision,
attached 	hereto, 	issued 	by 	a 	PERB administrative 	law 	judge
(ALJ). 	In 	that 	decision, 	the ALJ 	dismissed ACSA's 	charge 	that
the 	State 	of 	California 	(Department 	of 	Personnel 	Administration)
(DPA) 	negotiated 	in 	bad 	faith 	in 	violation 	of 	section 	3519(b)
and 	(c) 	of 	the 	State 	Employer-Employee 	Relations Act 	(SEERA or
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Act).1 In 	accordance 	with 	our 	discussion 	as 	set 	forth 	below,
we 	affirm 	the ALJ's 	proposed 	decision 	to 	dismiss 	the 	instant
charge.
1SEERA
FACTUAL 	SUMMARY
The 	findings 	of 	fact 	set 	forth 	in 	the ALJ's 	proposed
decision 	are 	free 	from prejudicial 	error 	and 	are 	adopted 	as 	the
factual 	findings 	of 	the 	Board 	itself. 	In 	summary, 	the 	instant
dispute arose 	in 	the 	spring of 	1983 when, 	pursuant 	to a 	clause
in 	the 	memorandum 	of 	understanding 	(MOU) 	between ACSA and 	the
State, 	ACSA 	initiated 	reopener 	negotiations 	concerning 	economic
matters.2 Although 	certain 	proposals 	and 	counterproposals
lsEERA 	is 	codified 	at 	Government 	Code 	section 	3512 	et 	seq.
Unless 	otherwise 	indicated, 	all 	statutory 	references 	herein 	are
to 	the Government 	Code.
Section 3519 	provides, 	in pertinent part:
It 	shall 	be 	unlawful 	for 	the 	state 	to:
(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.
2Section 49 	of 	the 	MOU provided, 	in part:
At 	any time 	after 	January 1, 	1983, 	either
party 	shall 	be 	entitled 	to 	open 	negotiations
to modify 	the 	following provisions 	of 	the
Agreement: 	Bar Dues, 	salary, 	Health,
Dental, 	MSA, 	Travel Expense, 	Education and
Training, Overtime, Pension plan, Vacation,
Sick 	Leave, 	Holidays, 	and up to three
additional 	items. 	Negotiations 	shall
commence 	not 	earlier 	than 	10 	work 	days 	after
N
• 	• 	• 	• 	•
2

were 	exchanged between ACSA and 	DPA, 	it 	is 	undisputed 	that,
until June 	30, 	1983, 	DPA made no 	counteroffers on economic
matters. 	DPA's chief negotiator, 	James Mosman, 	advised ACSA
representatives 	that 	the 	Governor 	was 	determined 	to 	stay 	within
a 	$22 	billion 	budget 	limit 	and 	that, 	while 	$337 	million 	had been
allocated 	in 	the Governor's 	budget 	for 	state 	employees' 	total
compensation,3 that 	figure 	was 	not 	considered 	firm 	nor 	was 	it
an 	offer. 	Mosman 	testified, 	"[t]he 	amount 	could 	go up or 	down
depending 	on 	negotiations 	with 	the 	legislative 	process 	and 	with
the Governor."
During 	May 	and 	June, 	ACSA 	continued 	to 	put 	forth 	specific
economic 	proposals. 	Mosman's 	position 	was 	that 	he was 	not 	able
to 	negotiate 	economic 	items 	because 	such 	discussions 	were
dependent 	on 	the 	amount 	of money 	that would 	be 	available. 	By
mid-June, 	while 	Mosman 	continued 	to 	assert 	that 	he 	could 	not
talk 	hard 	economics 	until 	after 	the 	Legislature 	had 	passed 	the
budget, 	he 	asked 	that 	ACSA 	prioritize 	its 	economic 	demands
should 	the 	final 	budget 	allocate 	a 	three-percent 	increase.
However, 	by the 	end 	of June, 	the parties 	had 	reached no
agreement. 	Mosman 	stood 	ready 	to 	discuss 	economic 	proposals
receipt 	of 	written 	notice 	by 	the 	opening
party 	respecting 	the 	matters 	upon 	which
negotiations 	are 	requested.
3ACSA 	takes 	exception 	to 	the ALJ's 	factual 	finding 	that
the 	$337 	million was 	allocated 	for 	employees' 	"salaries." 	ACSA
correctly 	notes 	that 	that 	figure 	reflected 	the 	total 	amount 	of
employee 	compensation.
W
	3

subject 	to 	the 	availability of 	funding, 	and ACSA 	awaited
specific 	economic 	proposals 	prior 	to 	the 	adoption 	of 	the 	budget.
In 	the meantime, 	the 	matter 	of 	State 	employees' 	compensation
was 	working 	its 	way 	through 	the 	legislative 	budget 	process. 	The
final 	version was 	presented 	to 	the Governor. 	Believing 	that
continued 	negotiations 	with 	the 	Legislature 	would 	not 	be
forthcoming, 	DPA settled 	on a 	figure 	for 	employee 	compensation.
Thus, 	when 	the parties met 	on June 30, 	DPA made 	its proposal
concerning 	economic 	offers. 	Although 	various 	offers 	and
counteroffers 	were 	exchanged 	by 	the 	parties 	during 	the 	first
three weeks 	of July, 	no 	final 	agreement was 	reached.
The 	State 	budget 	was 	adopted 	by 	the 	Legislature 	on July 	19
and, 	on July 21, 	the Governor 	took 	final 	action on 	the budget,
cutting 	employee 	compensation 	to 	the 	original 	$337 	million
figure.
Subsequently, 	the 	Board 	ordered 	mediation 	and 	agreement 	was
reached.
DISCUSSION
Section 	3517 	of 	SEERA 	sets 	forth 	the 	Governor's 	obligation
to meet 	and 	confer 	in 	good 	faith. 	It 	requires 	the Governor 	to
meet 	with 	representatives 	of 	recognized 	employee 	organizations
and 	consider 	fully 	the 	representatives' 	presentations 	"prior 	to
arriving 	at 	a 	determination 	of policy 	or 	course 	of 	action."
Section 	3517 	further 	directs 	that 	the Governor 	and 	the 	employee
organizations 	"endeavor 	to 	reach 	agreement 	on 	matters 	within 	the
scope 	of 	representation prior 	to 	the 	adoption 	by 	the 	state 	of
A	4

its 	final 	budget 	for 	the 	ensuing year." 	That process, 	according
to 	SEERA, 	"should 	include 	adequate 	time 	for 	the 	resolution 	of
impasses."4
A	4
Interpretation 	of 	this 	statutory 	provision 	lies 	at 	the 	root
of 	the 	parties' 	dispute. 	ACSA 	contends 	that 	DPA 	acted 	unlawfully
by 	failing 	to 	meet 	and 	confer 	with 	ACSA 	until 	negotiations 	between
the 	Governor 	and 	the 	Legislature 	had 	been 	completed. 	Relying 	on
Article IV, section 12(c), of the California Constitution5 5
4In 	its 	totality, 	section 	3517 	reads 	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
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.
5Section 	12(c) 	of 	the California Constitution 	reads;
The 	budget 	shall 	be 	accompanied 	by 	a 	budget
bill 	itemizing 	recommended 	expenditures.
The 	bill 	shall 	be 	introduced 	immediately 	in
5

that 	requires 	the 	Legislature 	to 	submit 	its 	budget 	bill 	to 	the
Governor 	by June 	15, 	good 	faith 	bargaining mandates 	that
economic 	proposals 	be 	initiated 	and 	exchanged 	before 	June 	15.
In the 	instant 	case, 	ACSA 	contends 	that 	DPA 	engaged 	in a 	per 	se
violation 	of 	its 	duty 	to 	negotiate 	in 	good 	faith 	by 	refusing 	to
negotiate 	wages 	until 	June 	30 	and 	further 	avers 	that 	the
"feverish 	bargaining 	activity" 	that 	occurred 	thereafter 	did 	not
cure 	DPA's 	previous 	unlawful 	conduct. 	Alternatively, 	ACSA
asserts 	that 	the 	totality 	of 	circumstances 	surrounding 	DPA's
bargaining 	conduct 	supports 	a 	finding 	of 	bad 	faith 	bargaining.
DPA 	urges 	adoption 	of 	the 	ALJ's 	position 	declining 	to 	read
section 	3517 	as 	imposing 	any 	fixed 	timeline 	and argues 	that, 	so
long 	as 	the parties 	exchange 	proposals 	prior 	to 	final 	adoption
of 	the 	State budget, 	whenever 	that 	occurs, 	the good faith
negotiating 	standard 	has 	been 	met.
The 	statutory 	interpretation 	put 	forth 	by ACSA 	finds 	some
support 	in 	the 	language of 	section 	3517. 	Clearly, 	that 	provision
discusses 	the 	duty 	to meet 	and 	confer 	in 	good 	faith 	with 	certain
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.
66

time 	limitations 	in mind. 	The Governor 	must meet 	"prior 	to
arriving 	at 	a 	determination 	of 	policy or 	course 	of 	action," 	must
"meet 	and 	confer 	promptly 	upon 	request" 	and 	"for 	a 	reasonable
period 	of 	time." 	These phrases 	convey 	the 	Legislature's 	clear
directive 	that 	discussions 	proceed 	expeditiously 	and 	without
delay. 	Notably, 	this 	instruction makes 	specific 	reference 	to
adoption 	of 	the 	final 	budget 	and 	directs 	the 	parties 	"to 	endeavor
to reach agreement 	. 	. 	. 	prior to" 	final budget adoption.
In our 	view, 	while 	this 	language 	uses 	the 	final 	budget 	as 	a
point 	of 	reference, 	it 	cannot 	be 	read 	to 	support ACSA's
assertion 	that, 	under 	all 	circumstances, 	failure 	to negotiate
before June 	15 	equates with 	a 	per 	se 	refusal 	to bargain. 	First,
the 	constitutional 	requirement 	directs 	the 	Legislature 	to 	pass
the budget 	bill 	by the June 	15 	deadline. 	It 	orders 	no party
over 	whom PERB's 	jurisdiction 	extends 	to 	perform 	any 	task.
Rather, 	it 	is 	SEERA 	section 	3517 	that 	imposes 	a 	good 	faith
bargaining 	obligation 	on 	the 	State 	employer 	and 	from which
PERB's 	jurisdiction 	derives. 	As 	noted above, 	that 	section
requires 	action 	"prior 	to 	the 	adoption 	by the 	state 	of 	its 	final
budget 	. 	. 	. 	." 	As 	the ALJ noted, 	if adoption of the final
budget 	refers 	to 	the 	date 	on which 	the 	Governor 	completes 	final
action 	on 	the 	budget 	sent 	to 	him by 	the Legislature, 	the 	state
satisfied 	its 	obligation 	because 	it 	met 	and 	conferred with 	ACSA
for 	three 	weeks 	before 	final 	budget 	action 	was 	taken 	by 	the
Governor 	on July 21. 	If, 	on the other 	hand, 	the 	State's 	final
budget 	action 	refers 	to 	the 	date 	when 	the 	Legislature 	sends 	its
1 1 1
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final 	version 	to 	the 	Governor, 	DPA 	similarly 	satisfied 	its 	SEERA
obligation 	by meeting 	and 	conferring with 	ACSA 	prior 	to 	passage
of 	the 	Budget Act 	on July 	19. 	In 	either 	event, 	nothing 	in 	SEERA
prohibits 	the 	Governor 	from 	entertaining 	a 	legitimate 	doubt 	that
the budget bill would not 	precede the June 	15 	date. 	Thus, 	the
State 	may 	base 	its 	bargaining 	strategy 	on 	a 	good 	faith 	judgment
that 	budget 	finalization 	will 	not 	scrupulously 	honor 	the
constitutional 	deadline 	without 	violating 	SEERA. 	As 	the 	ALJ
noted, 	the 	language 	of 	section 	3517 	imposing 	an 	obligation 	"to
endeavor" 	exhorts 	the parties 	to attempt 	or 	to 	strive 	in 	earnest
to attain 	a certain 	end. 	Thus, 	the 	statutory mandate 	is 	violated
where 	either 	party's 	conduct 	fails 	to 	demonstrate 	such 	effort.
However, 	the 	statutorily 	imposed 	obligation 	"to 	endeavor" 	can 	by
no 	means 	be 	interpreted 	to 	create 	an 	absolute 	standard 	pursuant
to which 	a 	failure 	to 	present 	proposals 	by June 	15 	must 	be 	judged
a 	per 	se violation.
In 	accord 	is 	Dublin Professional 	Fire Fighters, 	Local 	1885 	v.
Valley 	Community 	Services 	District 	(1975) 	45 	Cal.App.3d 	116,
where 	the 	court 	interpreted 	similar 	statutory 	language 	found 	in
the 	Meyers-Milias-Brown Act 	(MMB) 	applicable 	to 	local 	government
employees 	and 	employers.6 There, 	the 	court 	addressed 	the
6The 	MMB 	is 	codified at 	section 	3500 	et 	seq. 	Section
3505 	sets 	forth 	the 	obligation 	to meet 	and 	confer 	and 	provides:
The 	governing body of 	a public 	agency, 	or
such boards, 	commissions, 	administrative
officers 	or 	other 	representatives 	as may be
properly 	designated 	by 	law 	or 	by 	such
CO
	8

Valley 	Community 	Services 	District's 	contention 	that 	statutory
reference 	to 	the 	adoption 	of 	the budget 	implies 	that 	a 	request
to meet 	and confer 	is 	ineffective 	if 	it 	is 	not made 	prior 	to 	the
adoption 	of 	the 	budget. 	The 	court 	rejected 	that 	argument
stating:
The 	construction 	proposed 	by 	the 	district 	is
not correct; 	the obligation, 	in proper cases,
to 	"meet 	and 	confer 	promptly 	upon 	request"
is 	absolute, 	while 	the 	statutory admonition
to 	"reach 	agreement" 	before 	the 	adoption 	of
the 	budget 	is 	only hortatory. 	Agreement may
not be 	reached at 	all, 	as 	the statute
recognizes 	in 	stating 	that 	the 	negotiators
governing body, 	shall 	meet 	and 	confer 	in
good faith 	regarding wages, 	hours, 	and other
terms 	and 	conditions 	of 	employment 	with
representatives 	of 	such 	recognized 	employee
organizations, 	as 	defined 	in 	subdivision 	(b)
of 	Section 3501, 	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 	a
public agency, 	or 	such 	representatives as 	it
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 	public 	agency 	of 	its
final 	budget 	for 	the ensuing year. 	The
process 	should 	include 	adequate 	time 	for 	the
resolution 	of 	impasses 	where 	specific
procedures 	for 	such 	resolution 	are 	contained
in local rule, regulation, or ordinance, or
when 	such 	procedures 	are 	utilized 	by mutual
consent.
9

should 	"endeavor" 	to 	reach 	agreement 	before
the 	budget 	is 	adopted.
While 	the 	factual 	circumstances 	surrounding 	the 	Dublin 	case
are 	not 	identical 	to 	those here at 	issue, 	the 	court's
interpretation 	of 	statutory 	language 	similar 	to 	section 	3517 	is
instructive. 	indeed, 	the 	court 	offers 	pertinent 	guidance when
it 	observes 	that 	the 	obligation 	to meet 	and 	confer 	in 	good 	faith
is 	absolute. 	Regardless 	of 	the 	date 	contract proposals 	are
first 	conveyed, 	whether 	far 	in 	advance 	of 	final 	budget 	action 	or
just 	prior 	to 	final 	action, 	the Governor 	violates 	the Act 	if 	his
bargaining 	conduct 	during 	the 	course 	of 	the 	process 	runs 	afoul
of 	traditional 	standards 	used 	to 	determine 	whether 	a 	party has
acted 	in 	bad 	faith. 	In 	our 	view, 	the Act 	imposes 	no 	automatic
sanctions 	on 	parties 	that 	fail 	to 	reach 	agreement 	prior 	to
budget 	passage.
In so 	concluding, 	we 	reject ACSA's 	assertion 	that we should
adopt 	its 	interpretation 	of 	3517 	because 	section 	3517.6 	requires
approval 	of 	expenditures 	in 	the 	annual 	Budget Act.7 First,
that 	section 	merely 	states 	that 	a 	provision 	requiring 	the
expenditure 	of 	funds 	cannot 	become 	effective 	without 	legislative
approval. 	Moreover, 	section 3517.7 	specifically permits 	either
7In 	pertinent 	part, 	section 	3517.6 	provides:
. . . 	If 	any 	provision 	of 	the 	memorandum 	of
understanding 	requires 	the 	expenditure 	of
funds, 	those 	provisions 	of 	the memorandum of
understanding 	shall 	not 	become 	effective
unless 	approved by the Legislature 	in 	the
annual Budget Act. 	. 	. 	.
10

party 	to 	reopen 	negotiations 	on 	all 	or 	part 	of 	their 	MOU 	in
those 	situations 	where 	the 	Legislature 	does 	not 	approve 	or 	fully
fund 	any 	provision 	of 	the 	MOU.
0
8 Thus, 	reading 	section 	3517.6
together 	with 	section 	3517.7, 	the 	conclusion 	finding no
statutory 	deadline 	is 	more 	compelling.
We 	turn 	next 	to ACSA's 	contention 	that 	by 	seeking 	to 	delay
bargaining 	until 	the 	legislative 	budgetary process 	was 	completed,
DPA's 	conduct 	should be viewed 	as 	an 	outright 	refusal 	to 	bargain
and 	a 	per 	se violation 	of 	SEERA.
As 	the ALJ 	correctly noted 	in 	his 	proposed 	decision, 	this
Board 	has 	considered 	certain 	bargaining 	conduct 	so 	obstructive
of 	the 	negotiating process 	that 	it warrants 	a 	finding of 	a per
se 	violation. 	Pajaro Valley Unified 	School 	District 	(1978) 	PERB
Decision No. 	51; 	Stockton Unified School 	District 	(1980) 	PERB
Decision No. 	143; 	San 	Mateo County Community College District
(1979) 	PERB Decision No. 	94; 	Sierra Joint 	Community College
District 	(1981) 	PERB Decision No. 	179; 	Ross 	school District
(1978) 	PERB Decision No. 	48; 	Modesto City Schools 	(1983) 	PERB
Decision No. 	291. 	Here, 	however, 	we do not view DPA's
determination 	to 	defer 	negotiations 	until 	the 	legislative
8 In
If 	the 	Legislature 	does 	not 	approve 	or 	fully
fund 	any 	provision 	of 	the 	memorandum of
understanding 	which 	requires 	the 	expenditure
of 	funds, 	either 	party may reopen
negotiations 	on all 	or 	part 	of 	the
memorandum 	of 	understanding.
11
Srn 	pertinent part, 	section 3517.7 	reads:

process 	was 	completed 	as 	an 	outright 	refusal 	to bargain with
ACSA. 	In 	situations 	best 	exemplified by the 	instant 	case, 	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 	SEERA's 	mandate.
This 	is 	not 	to say, 	however, 	that we accept DPA's 	insistence
that 	it 	could 	not 	negotiate 	on wages 	until 	an agreement was
reached with 	the 	Legislature. 	The Governor 	is 	free 	to 	negotiate
with 	employee 	organizations 	while 	making 	it 	clear 	that 	the
agreed-upon 	provisions 	require 	legislative 	approval. 	In 	sum,
SEERA's 	statutory 	provisions 	do 	not 	specifically mandate 	that
negotiations 	with 	the 	employee 	organization 	must 	precede 	or
follow 	final 	legislative 	action. 	Negotiations 	with 	the
employees' 	representative 	and with 	the 	Legislature may and 	often
do 	occur 	simultaneously. 	What 	is 	imperative 	to 	statutory
compliance 	is 	that 	negotiations 	be 	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. 	Mt. 	Diablo Unified School 	District 	(1983) 	PERB
Decision No. 	373. 	Delay of negotiations 	until 	legislative
budget 	action 	does 	not 	lead 	to 	the 	conclusion 	that 	DPA 	lacked
the 	requisite 	intent 	to 	reach 	an 	agreement 	with 	ACSA.
12

Finally, 	ACSA disputes 	the ALJ's 	conclusion 	that, 	under 	the
totality 	of 	conduct 	test, 	DPA 	did not 	engage 	in 	conduct 	that
failed 	to 	satisfy 	its 	statutory 	obligation 	to 	meet 	and 	discuss
in 	good 	faith. 	Again, 	we 	disagree 	and would affirm the ALJ's
analysis. 	In 	sum, 	we 	do 	not 	find 	that 	DPA 	summarily 	rejected
ACSA's proposals, 	adopted a take-it-or-leave-it approach, 	or
demonstrated 	such 	intransigence 	that 	good 	faith 	bargaining 	was
thwarted. 	DPA 	responded 	to ACSA's 	proposals 	and, 	as 	noted 	above,
acted within 	the 	requirements 	of 	the 	law when 	it 	took 	the
position 	that 	it 	wished 	to 	defer 	or 	delay 	its 	presentation 	of
economic 	proposals 	until 	the 	State's 	financial 	picture 	became
more 	clear. 	We also cannot 	conclude, 	as ACSA asks, 	that Mosman
lacked 	sufficient 	authority 	to bind 	the 	employer. 	Here, 	the
bargaining process 	progressed 	as 	it 	did 	because 	of 	DPA's
concerns 	regarding 	the 	State's 	fiscal 	uncertainties. 	Mosman's
conduct 	on 	DPA's 	behalf 	did 	no more 	than 	effectuate 	the
employer's 	legitimate 	bargaining 	plan 	and 	in 	no way 	demonstrated
bad 	faith 	bargaining.g
ORDER
Based 	upon 	the 	foregoing findings 	of 	fact, 	conclusions 	of
law 	and 	the 	entire 	record 	in 	this matter, 	unfair 	practice 	charge
S-CE-184-S 	filed 	by 	the Association 	of 	California 	state 	Attorneys
9Finding 	no 	evidence 	of 	bad 	faith 	bargaining, 	we 	need 	not
address 	the ALJ's 	conclusion 	that 	DPA's 	conduct 	beginning 	on
June 	30 	"cured" 	bad 	faith 	bargaining 	that 	preceded 	it.
13

and 	Administrative 	Law Judges 	against 	the 	State 	of 	California
(Department 	of Personnel Administration) 	and 	the 	companion 	PERB
complaint 	are 	hereby DISMISSED.
Chairperson 	Hesse 	and 	Member 	Burt 	joined 	in 	this 	Decision
14
.

STATE 	OF 	CALIFORNIA
PUBLIC EMPLOYMENT 	RELATIONS 	BOARD
ASSOCIATION 	OF 	CALIFORNIA 	STATE
ATTORNEYS 	AND ADMINISTRATIVE 	LAW
JUDGES,
Charging 	Party,
v.
STATE 	OF 	CALIFORNIA 	(DEPARTMENT 	OF
PERSONNEL ADMINISTRATION),
Respondent.
) 	Unfair 	Practice
Case No. 	S-CE-184-S	)
)
) 	PROPOSED DECISION
(5/30/84)	)
Appearances: 	Ernest Schulzke, 	attorney, 	for Association of
California State Attorneys 	and Hearing Officers;
Christopher Waddell, 	attorney, 	for 	respondent State of
California 	(Department of Personnel Administration).
Before Gary M. 	Gallery, 	Administrative Law Judge.
DISCUSSION
In 	this 	case 	the 	employer 	is 	charged 	with violation of 	the
State 	Employer-Employee 	Relations Act 	by 	delaying 	negotiations
on 	economic matters.
On June 	3, 	1983, 	the Association of California State
Attorneys 	and Administrative Law Judges 	(ACSA)l 	filed 	an
Unfair 	Practice 	Charge 	against 	the 	State 	of 	California
(Department 	of Personnel Administration) 	alleging 	violation of
1PERB 	certification 	of 	the 	exclusive 	representative 	for
Unit 2 	(March 30, 	1982) 	is 	to the Association of California
State Attorneys 	and Hearing Officers. 	The 	current 	contract
between 	the 	parties 	list 	the 	same designation. 	The 	underlying
This Board agent decision has been appealed to
the Board itself and is not final. 	Only to the
extent the Board itself adopts this decision and
rationale may it be cited as precedent.
)
)
)
)
}
________________ l

Government Code 	subsections 	3519(b), 	(c) 	and 	section 	3517. 	A
Complaint 	was 	issued 	on July 	13, 	1983, 	charging 	that 	from April
1983 	through 	June 	1983, 	the 	parties 	met 	approximately 	six 	times
pursuant 	to Government 	Code 	section 	3517 	and 	that 	during 	this
time 	the 	Respondent 	1) 	refused 	to 	bargain 	over 	matters
requiring 	expenditures 	of 	funds, 	and 	2) 	failed 	to 	invest 	its
negotiators 	with 	sufficient 	authority 	to 	address 	and 	consider
employee 	demands. 	This 	conduct 	was 	stated 	to 	violate
Government 	Code 	subsection 	3519(c) 	and 	derivatively,
subsections 	3519(a) 	and 	(b).2 	The 	Respondent 	(State 	or 	DPA)
filed 	an Answer 	on August 	2, 	1983, 	denying 	violations 	of 	the
HEERA. 	An Amendment 	to 	the 	Unfair 	Practice 	Charge 	was 	filed 	on
September 	2, 	1983. 	An Amended 	Complaint 	was 	issued 	on
September 	6, 	1983. 	An Answer 	to 	the Amended 	Complaint 	was
unfair 	practice 	charge, 	and 	the 	complaint 	issued 	thereon, 	list
the 	Charging 	Party 	as 	the Association 	of 	California 	State
Attorneys 	and 	Administrative 	Law 	Judges.
2Government 	subsections 3519(a), 	(b) 	and 	(c) 	provide that
it 	is 	unlawful 	for 	the 	state 	to:
(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.
(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.
N	2

filed on September 	14, 	1983, 	denying violations 	and 	raising
defenses 	that 	will 	be 	discussed 	elsewhere 	in 	this 	proposed
decision. 	A 	settlement 	conference 	was 	held on August 30, 	1983,
without 	success. 	The 	formal 	hearing was 	held on
October 	26, 	1983. 	Post-hearing briefs were 	completed on
February 7, 	1984, 	and 	the matter 	submitted.
FINDINGS 	OF FACT
Respondent 	is 	the 	employer 	within 	the 	meaning 	of 	section
3513 	(i).3 ACSA 	is 	a 	recognized 	employee 	organization 	within
the 	meaning 	of 	Government 	Code 	section 	3513(b).4
The 	parties 	have 	a memorandum of 	understanding 	covering
July 1, 	1982, 	through June 30, 	1984. 	Reopeners on all money
matters 	as well 	as 	a 	limited 	number 	of 	additional 	topics 	are
provided. 	Section 49 of 	the 	contract provides, 	in part:
At 	any 	time 	after January 1, 	1983, 	either
party 	shall 	be 	entitled 	to open 	negotiations
to modify 	the 	following 	provisions 	of 	the
Agreement: 	Bar Dues, 	Salary, Health,
Dental, MSA, Travel Expense, Education and
Training, Overtime, Pension Plan, Vacation,
Sick Leave, 	Holidays, 	and up to three
additional 	items. 	Negotiations 	shall
commence 	not 	earlier 	than 	10 	work 	days 	after
receipt 	of written 	notice 	by 	the 	opening
party 	respecting 	the matters 	upon which
negotiations 	are 	requested.
3DPA 	is 	the 	Governor's 	representative 	on 	all matters
pertaining 	to meeting 	and 	conferring 	under 	the 	SEERA. 	See
Government 	Code 	section 	19819.7.
4ACSA 	represents 	all 	attorneys 	and 	administrative 	law
judges 	employed 	by 	various 	state 	agencies 	except 	exempt
employees.
W
	3

In 	the 	spring 	of 	1983 	ACSA wished 	to 	reopen many of 	the
money 	items 	for 	negotiations. 	The 	parties 	first met 	on
March 	11, 	1983.5 Ground 	rules 	were 	discussed 	and 	agreed
upon.6 Staffing 	ratios, 	a dispute 	from 	the 	prior 	year 	(DPA
had 	taken 	the position 	it was 	non-negotiable), 	was discussed
and 	the 	parties 	agreed 	to 	set 	up 	a 	separate 	committee 	to
address 	that 	issue. 	No proposals 	were 	advanced 	by ASCA at 	this
meeting.
Bruce Blanning, 	a private consultant, 	served as
spokesperson 	for ACSA. 	At 	the 	first meeting 	and 	for 	a 	short
time 	thereafter, 	Robert Bark 	represented DPA. 	Thereafter,
James Mosman, 	chief 	negotiator 	for 	DPA, 	represented 	that 	office
at 	all 	times 	pertinent 	hereto.
On March 	15 	ACSA 	advanced 	its 	initial 	reopener 	proposal 	to
DPA. 	Dennis Egan, 	Chairperson of 	the ACSA negotiating 	team,
advised Bark 	that 	it 	understood 	"the 	'sunshine' 	process 	would
be 	initiated 	on March 	18 	and 	completed 	by April 	15, 	so 	that
negotiations 	could 	begin 	immediately 	thereafter." 	ACSA's
proposal was 	a blanket request of 	section 49, 	cited above, 	plus;
Item 1. 	Working conditions, 	including
office space, size, 	and location; 	and
support 	staff.
5A11 	dates 	hereafter 	refer 	to calendar 	year 	1983 	unless
otherwise 	stated.
6Agreement 	was 	reached 	on 	the 	number 	of 	employee
representatives, 	amount of 	time off 	and 	the 	number 	of meetings,
A	4

- -
Item 2. 	Employee 	rights, 	including 	loss of
bargaining 	unit 	work, 	grievance procedure,
leave 	of 	absence 	(right 	of 	return,
maternity/paternity 	leave, 	etc.), 	and 	layoff
and 	recall.
Item 3. 	Rights 	of 	the 	parties 	to 	the MOU,
including State 	rights, 	unfair practice
prohibition, 	grievance procedure, 	agency
shop/fair 	share, 	entire agreement, 	payroll
deduction, 	and 	ground 	rules 	for 	future
negotiations.
Mosman 	responded 	in writing 	on April 	1 	enclosing 	the
State's 	counterproposal 	stating 	that 	"Following 	the Public
Comment Meeting, 	DPA would meet 	and 	confer7 	in good 	faith on
all of 	the proposals 	contained 	herein, 	in 	the context of 	a
total 	compensation 	package."
77DPA	opA 's counterproposal was as 	follows:
1. 	The State 	believes 	the 	current 	language
in 	the MOU concerning 	office 	space 	is
adequate. 	Support 	staff 	is 	a management
prerogative 	covered 	by 	the 	State 	Rights
clause 	in 	the present MOU.
2. 	ACSA must 	specify which 	item 	is 	to be 	an
actual 	topic of bargaining. 	The State would
be willing 	to meet 	and 	confer 	in good 	faith
on 	the 	grievance 	procedure or 	leaves of
absence or layoff 	and 	recall. 	The 	loss of
bargaining 	unit work per 	se 	is 	a management
-	prerogative 	covered 	by 	the 	State 	Rights
clause 	in 	the present MOU.
3. 	ACSA must 	specify which 	item 	is 	to be 	an
actual 	topic of bargaining. 	The State would
be willing 	to meet 	and 	confer 	in good 	faith
on State 	Rights 	or 	unfair 	practice
prohibition 	or 	grievance 	procedure 	or 	agency
shop/fair 	share or 	entire 	agreement or
payroll 	deduction or 	ground 	rules 	for 	future
negotiations.
5

It 	is 	undisputed 	that 	until June 	30, 	DPA did 	not 	and 	indeed
refused 	to make 	counter 	offers 	on economic matters. 	At 	the
formal 	hearing Mosman 	described 	the 	Governor's 	perceived 	fiscal
predicament 	and 	DPA's 	strategy 	at 	the 	bargaining 	table. 	In 	his
first 	year 	of 	office, 	the Governor 	inherited 	an $800 	million
deficit 	from 	the 	1982-83 	year. 	Determined 	to 	avoid 	any 	tax
increase, 	the Governor 	negotiated 	an 	agreement with 	the
Legislature 	to 	spread 	the 	deficit over 	a 	two-year 	period. 	To
obtain 	this 	he 	had 	to 	agree 	to 	an 	automatic 	sales 	tax 	increase
if 	the 	revenues 	did not meet 	expenditures 	and payment of 	the
deficit 	over 	the 	following 	two years. 	Within his 	proposed
1983-84 	budget, 	submitted 	to 	the Legislature 	in early January
1983,8 	were 	items with 	fixed 	amounts, 	such 	as 	state 	employees
compensation, 	education 	and welfare 	assistance. 	State 	salaries
were 	set 	at 	$337 	million 	(approximately 	a 	5 	percent 	increase
for 	employees 	of 	the 	state, 	the University 	and 	the State
University). 	The overall budget was $22 billion, 	an amount
which 	would 	avoid 	triggering 	the 	sales 	tax 	increase 	authorized
by 	the 	Legislature.9 During 	the 	spring, 	testified Mosman,
8Section 	12 	of Article 	IV of 	the California Constitution
requires 	the Governor 	to 	submit 	a 	budget 	to 	the Legislature,
for 	the 	ensuing 	fiscal year, 	within 	the 	first 	10 days of 	the
calendar 	year.
9The 	Governor 	was, 	as 	a matter 	of policy, 	said Mosman,
"very much opposed 	to 	a 	tax 	increase 	and made 	it 	clear 	to 	his
negotiator 	that 	he 	wished 	to 	avoid 	the 	tax 	increase."
66

the 	Governor's 	Office 	was 	negotiating 	with 	the Legislature 	on
amounts 	for 	education 	and 	welfare. 	Existing 	legislation
provided 	for 	an 	automatic 	4 	percent 	cost-of-living 	increase 	for
welfare 	assistance 	which 	was 	not 	included 	in the 	Governor's
budget. 	Also 	looming 	as 	a possible 	expense 	was 	the 	proposed
Sebastiani 	Initiative, 	which 	if 	approved 	by the Governor, 	would
require 	a 	fall 	election 	at 	state 	expense. 	Because of 	the
Governor's 	determination 	to 	stay within $22 	billion, 	the 	$337
million 	allocated 	for 	salaries 	was 	not 	considered 	firm. 	Mosman
told ACSA, 	as early as May 10, 	the 	5 percent was 	not an offer.
"The 	amount 	could 	go 	up or 	down," 	he 	said, 	"depending 	on
negotiations 	with 	the 	legislative 	process 	and with 	the
Governor."
At 	a meeting 	on April 	19 	ACSA made 	more 	specific 	and
detailed 	proposals which 	were discussed. 	Notably, 	ACSA
proposed 	that 	salaries be 	increased 	effective July 	1, 	1983, 	by
30 	percent, 	with 	an 	additional 	1 percent 	increase 	for 	those 	at
the 	top of 	their 	salary level. 	Salary negotiations 	for 	future
MOU's 	were 	to 	use 	as 	criteria only 	the 	prevailing 	compensation
for 	similar 	employees 	in other 	public 	agencies 	and 	private
employers 	in California which 	employ 	a 	large 	number 	of
employees. 	ACSA proposed 	state 	and 	local 	bar 	dues 	be 	paid 	up
to $200. 	It was 	also proposed 	that 	the 	state pay 	100 	percent
of 	health 	and 	dental 	coverage 	with 	alternatives 	to be 	paid 	by
state 	at ACSA's option. 	Vision care was 	to be 	an option.
7

00
Vacation 	was 	to be 	increased 	by 	(40 	hours) 	five 	days 	per 	year
and 	maximum carryover 	for 	employees 	with 	over 	10 	years 	service
to 	be 	increased 	to 	360 	hours. 	On working 	conditions ACSA
requested 	adequate 	support 	be provided. 	On employees' 	rights,
ACSA 	requested 	retention 	of 	bargaining 	unit 	employees'
assignments 	(it 	was 	noted 	that 	negotiations 	regarding 	staffing
ratios 	were 	being 	conducted 	separately). 	ACSA 	requested 	agency
shop/fair 	share 	and 	deletion of 	state 	rights 	and 	the 	no 	strike
provisions 	in 	the 	existing 	MOU.10
At 	the 	meeting Blanning 	explained 	the 	rationale 	for 	the
salary 	increase. 	Blanning 	testified 	that 	Mosman 	expressed 	the
view 	that 	the Governor 	had 	been 	generous 	to 	include 	5 	percent
in 	the 	budget 	and 	was 	uncertain whether 	any more money was
going 	to 	be 	available. 	Mosman 	also 	questioned 	whether 	the
proposed 	health 	plan 	was 	negotiable.
On May 9 	Egan 	forwarded 	to Mosman 	revisions 	of 	its April 	19
package.11 These 	revisions, 	said Blanning, 	were 	responsive
10ACSA 	also 	proposed 	that 	travel 	was 	to be 	determined;
merit 	salary adjustments 	were 	to 	be 	continued; 	state 	to pay all
but one percent of employees' 	pensions; 	employees be granted
option 	to 	be 	paid 	for 	excess 	vacation; 	employee 	have option 	to
have 	50 	percent 	of 	accumulated 	sick 	leave 	compensated 	in 	cash
and 	at 	termination 	all 	accumulated 	sick 	leave 	purchased 	by
state; 	and 	holidays 	to be 	continued plus 	three 	extra days.
11ACSA 	stated 	that 	they 	would 	be 	submitting 	specific
proposals 	for 	layoff 	justification 	and 	new 	or 	revised 	language
implementing 	layoff; 	agency 	shop/fair 	share 	to be 	applied 	to
unit 	employees 	and 	further 	specific 	proposals 	on 	the 	obligation
to meet 	and 	confer.
8

to 	DPA's 	concern 	about 	the 	number 	of 	non-money 	items 	requested
for 	reopeners. 	At 	a 	meet 	and 	confer 	session 	on May 	10 	ACSA's
May 	9 	and 	the 	State's 	counterproposal 	were 	discussed.12
Blanning 	testified 	that 	Mosman 	said 	at 	this 	meeting 	that
his 	[Mosman's] 	role 	was 	to 	provide 	input 	to 	the 	Governor's
12The 	State's 	May 	9 	counterproposal 	(to ACSA's April 	19
proposal) 	included 	the 	following:
1. 	Salaries
Any 	increase 	in 	salaries, 	if 	agreed 	to,
will 	be 	considered 	as 	a 	part 	of 	the
total 	compensation 	package. 	In
negotiating 	salaries, 	the 	State 	employer
is 	willing 	to 	consider:
1) 	Duties 	and 	responsibilities 	of 	the
classification
2) 	Salaries 	paid 	for 	comparable 	service
in 	other 	public 	and 	private 	employment
3) 	The 	State's 	financial 	condition
Merit 	salary 	adjustments 	and 	longevity
pay 	will 	also 	be 	considered 	in 	the
context 	of 	the 	total 	compensation
package.
2. 	Bar 	Dues
The 	State 	employer 	is 	willing 	to
consider 	payment 	of 	bar 	dues 	in 	the
context 	of 	the 	total 	compensation
package.
3. 	Health Benefits
The 	State 	employer 	will 	negotiate 	the
rate 	of 	contribution 	to 	health 	benefits
as 	a 	part 	of 	the 	total 	compensation
package. 	The 	selection 	of 	health 	plans
99

office, 	and 	that only Mike Frost, 	director of DPA, 	had
authority 	to make 	money offers 	and 	Mosman's 	role 	was 	to
understand 	the 	proposals 	and 	channel 	them 	to 	the 	Governor's
office, 	not 	to negotiate. 	He 	was 	there 	to discuss. 	Mosman
could 	not 	recall 	having 	made 	a 	statement 	about his 	authority
and 	was 	not 	asked 	about 	Frost's 	authority. 	Blanning 	testified
that 	he 	complained 	about 	the 	failure 	of 	DPA 	to make proposals
on economic matters. 	Mosman 	said 	that at 	a 	time 	in 	the 	future
the 	Legislature 	would 	establish 	"a 	pile 	of money," 	and 	at 	that
point Mosman 	would 	offer 	total 	compensation 	for 	unit 	2.
Blanning 	asked 	when 	money 	would 	be 	negotiable 	and 	Mosman 	didn't
know, 	but 	it would 	not occur 	before June 	1. 	The parties
reviewed 	the 	criteria on 	salaries 	set 	forth 	in DPA's 	proposal
of 	May 	9.
is 	not 	covered 	by SEERA and 	remains 	in
the 	jurisdiction 	of 	the Public
Employees' 	Retirement System.
The 	counterproposal 	also 	expressed 	DPA's 	willingness 	to
negotiate 	as 	part 	of 	the 	total compensation package:
. 	. 	. bar dues; dental benefits, merit
salary adjustments, 	travel expenses,
overtime, 	contribution 	rate 	to PERS 	(noting
that 	changes 	to 	the 	formula 	for 	calculating
retirement 	allowances 	were 	not 	within 	the
scope of bargaining), 	vacation increase,
sick 	leave, 	and holidays.
DPA made 	no counterproposals 	on 	the 	working 	conditions;
rejected ACSA's Employees' 	Rights proposal, 	and 	requested
specification 	of 	the 	Rights 	of Parties proposal 	advanced 	by
ACSA.
10
'

There 	was 	also 	heated 	discussion on 	the 	health 	and 	PERS
issues. 	The 	parties discussed 	a 	separate 	health plan. 	Another
unit 	had 	negotiated 	a 	separate 	health 	plan 	the 	previous 	year
said Blanning, 	but he 	said Mosman would 	not 	agree 	to 	the 	same
for 	unit 	2. 	They discussed 	DPA's position 	that 	retirement
systems 	were 	not 	negotiable 	because 	they 	were 	not 	supersedable
under 	SEERA. 	ACSA 	requested 	and Mosman 	agreed 	to put 	that
position 	in 	writing.13
1 3 0n May 23 Mosman advised ACSA, 	in writing, 	of 	the
State's 	position 	regarding 	negotiability of 	the 	health 	and
retirement 	benefits 	and 	supersession. 	Stated Mosman:
Government Code 	section 3517.6 	delineates 	a
series 	of 	statutes 	which may 	be 	superseded
if 	they are 	in conflict with 	the provisions
of 	a memorandum of 	understanding. 	It
further 	provides 	that 	any provision of 	an
MOU 	requiring 	the 	expenditure 	of 	funds 	shall
not 	become 	effective 	unless 	approved 	by 	the
Legislature 	in 	the 	annual Budget Act.
Section 3517.6 	then provides 	that 	"If 	any
provision 	of 	the 	memorandum of 	understanding
requires 	legislative 	action 	to permit 	its
implementation 	by 	amendment 	of 	any 	section
not cited 	above, 	those provisions of 	the
memorandum of 	understanding 	shall 	not 	become
effective 	unless 	approved 	by 	the
Legislature."
It 	is 	the State's position that, 	in
accordance with 	section 3517.6, 	changes 	to
statutes 	not 	specified 	in 	the 	supersession
clause 	require 	legislative 	approval. 	The
MOU 	ratification 	process 	that 	occurs 	as 	a
part of 	the 	enactment of 	the Budget Act 	is
not 	sufficient 	for 	a MOU provisions 	to
supersede 	a 	statute 	not 	specified 	in 	section
3517.6. 	Approval of MOU provisions
affecting 	a 	statute 	not 	subject 	to 	the
11

Mosman 	suggested 	they meet 	again on June 	2. 	While 	that 	was
three weeks 	away, 	and ACSA wanted 	to meet 	sooner 	to negotiate,
Blanning 	said ACSA agreed 	to meet 	under 	protest, 	less 	it 	lose
the 	opportunity 	to meet.
Mosman 	called Blanning 	on May 	27 	and 	warned 	him 	that 	they
might not be 	able 	to negotiate at 	the 	next meeting. 	The
parties 	met 	on June 	1 	anyway. 	ACSA proposed 	a detailed
proposal 	on 	travel 	expenses. 	DPA gave ACSA data 	from the
controller's 	office 	of classes 	within 	unit 	2. 	The 	parties
further 	discussed 	DPA's 	position 	on 	negotiability of 	health 	and
retirement 	and ACSA's 	frustration 	with Mosman's 	May 	23
letter.14 	Mosman 	announced 	that 	his 	position 	was 	that 	other
than 	the 	amount of money contributed 	by 	the 	State, 	other
features 	were 	out of 	scope. 	Mosman 	said 	he 	would 	check 	with
his 	attorneys 	and 	get 	back 	to ACSA.
Blanning 	testified 	that Mosman 	again 	stated 	that 	he 	was 	not
there 	to 	negotiate money 	items 	and Mosman confirmed 	this. 	The
compelling 	criteria would 	be whatever 	money was 	available. 	He
supersession 	clause 	requires 	additional
legislation. 	This 	is 	the State's position
relative 	to 	retirement 	and 	health 	benefits
provisions 	not 	subject 	to 	section 3517.6.
If 	the 	Legislature 	had 	intended 	these
provisions 	to be 	subject 	to 	the 	supersession
clause, 	it would 	have 	included 	their
statutory 	basis 	in 	section 	3517.6.
14ACSA 	complained 	that Mosman's 	letter 	was 	not 	responsive
to the 	issue: 	whether, 	in DPA's judgment, 	an 	item not 	included
in 	the 	supersedable 	section 	was or 	was 	not 	negotiable.
12

hoped 	to 	have 	some 	economic 	proposals 	by 	the next 	week. 	The
money 	in 	the 	Governor's 	budget 	was 	not 	an offer.
The 	parties met 	again on June 	2. 	Mosman 	told Blanning 	that
he 	was 	still 	waiting 	for 	the 	Department 	of Finance 	to provide
data on 	costing 	out 	fringe 	benefits 	for 	Unit 	2. 	Mosman 	hoped
to 	receive 	it 	any day and Blanning 	expressed 	fear 	of 	the 	fact
that 	it was June 	and 	they were 	still 	without 	that 	data.
The 	parties 	agreed 	to 	next meet 	on June 	13. 	Again ACSA was
concerned 	about 	the 	timing, 	but Mosman 	told 	them 	that 	he would
not 	have 	funding 	authority 	until 	then.
Blanning 	and Mosman 	spoke 	by 	telephone 	on June 	9. 	Mosman
told Blanning 	that 	DPA's 	position 	after 	conferring 	with 	their
attorneys 	was 	that 	other 	than money, 	revisions 	to health or
retirement 	benefits 	were out 	of 	scope. 	During 	another
telephone 	conversation 	that 	same 	day, 	Mosman 	told Blanning 	that
he 	was 	still 	waiting 	for 	information 	from 	the Department 	of
Finance 	on 	benefits 	costs 	but 	he 	would 	advance 	a 	hypothetical
prioritizing of 	a 	3 	percent 	increase 	at 	the June 	13 meeting.
ACSA would 	be 	given 	the 	opportunity 	to express 	its 	preference
of where 	money could 	be 	spent 	if 	it were 	available. 	Blanning
asked 	about 	the 	5 	percent 	increase 	and Mosman 	told 	him DPA was
concerned 	about 	the 	amount 	that 	might 	be 	in 	the 	budget 	for
State 	salaries.
At 	the June 	13 	meeting ACSA 	wanted 	to meet 	and 	confer 	on
money. 	Mosman 	said 	that 	based 	on 	information 	from 	the
13

controller, 	a 	1 percent 	raise would 	cost $900,000. 	The
Legislature's 	version of 	the 	budget 	at 	that 	time was $23.3
billion or 	1.3 	billion over 	the 	Governor's 	budget. 	The
Governor 	was 	going 	to cut 	the 	budget 	to $22 	billion when passed
by 	the Legislature. 	Mosman 	said 	he 	would 	not 	talk 	hard
economics 	until 	after 	the Legislature 	passed 	the 	budget.
Mosman 	then 	requested ACSA's 	priorities 	if 	3 	percent 	were
available. 	Mosman 	did 	extend 	a proposal 	on 	staffing 	ratios,
but Blanning 	said 	that 	item was 	not 	really 	negotiations.
Mosman 	then 	announced 	data 	setting 	forth 	the 	cost 	of 	four
items. 	The 	items 	were: 	$50 	toward PERS 	(ACSA had 	requested 	it
continue), 	continued State payment of medical plan, 	dental
plan; 	salary adjustments 	and 	ingrade 	adjustments. 	Mosman 	said
the 	cost 	of 	these 	four 	items was 	4.2 	percent. 	Mosman was 	not
offering 	4.2 	percent 	but 	asked ACSA where 	it 	would 	like 	the
three 	percent 	to go. 	Because of 	the 	need 	for 	the Governor 	to
cut 	some 	items 	from 	the 	budget 	and 	not 	being 	able 	to 	cut
others, 	State employees' 	salaries might be cut and 	for 	that
reason, Mosman could 	not offer 	the 5 	percent 	that was 	in 	the
Governor's 	budget. 	Mosman 	said DPA would make 	a money offer
after 	the 	budget 	conference 	committee 	had 	completed 	its 	work.
ACSA, 	said Blanning, 	tried 	to negotiate 	fringe 	benefits 	on
the 	basis 	of 	salary 	savings 	realized 	by 	attrition 	in 	some
departments 	because 	of 	layoffs. 	Mosman would 	not 	negotiate 	and
rejected 	the 	proposal. 	ACSA 	asked 	about 	bar 	dues 	and 	overtime,
14

both 	of 	which Mosman 	refused 	to 	negotiate 	regardless 	of 	the
source of funding. 	Mosman, 	said Blanning, 	asked for
clarification 	of 	who ACSA was 	seeking 	bar 	dues 	reimbursement.
It 	was 	decided 	that 	the 	parties 	would 	meet 	again when Mosman
could make 	an 	initial 	economic 	proposal. 	Mosman's 	position 	for
making 	an 	economic 	proposal 	then 	had 	shifted 	from 	finality of
the 	conference 	committee's 	work 	to 	needing 	an 	agreement 	between
the Legislature 	and 	the 	Governor.
On June 	16 Blanning 	confirmed, 	in writing, 	ACSA's proposal
that 	department 	savings 	as 	a 	result of 	the 	reduction of
attorney 	positions 	be 	used 	for 	certain 	"money" 	items. 	Blanning
also 	confirmed 	that ACSA was 	waiting 	for 	a 	call 	regarding 	a
meeting 	for 	presentation 	of DPA's 	initial 	economic 	proposals.
On June 	21, 	Mosman wrote 	to Blanning 	regarding ACSA's
proposal 	on 	department 	savings.15 Mosman 	announced 	that 	he
was 	"still 	willing 	to meet 	with you 	at 	any 	time 	to discuss 	an
economic 	proposal 	which 	is 	subject 	to 	the 	availability of
funding."
Blanning 	responded 	on June 	27 	stating:
15	lSCalling	calling 	the 	logic 	underlying 	the 	proposal 	a 	"fatal
flaw," 	Mosman 	pointed 	out 	the 	department's 	"commensurate 	loss 	of
funding" 	for 	positions 	reduced. 	No 	savings 	are 	realized 	unless
the 	department 	leaves 	budgeted 	positions 	unfilled. 	Questioning
ACSA's 	desire 	to have 	budgeted 	but 	vacant 	positions 	fund 	its
economic 	proposals, 	Mosman 	pointed out 	that 	such 	a 	situation
would make 	it 	almost 	impossible 	for 	the 	State 	to place
attorneys 	facing 	layoff.
15

Your June 	21 	letter 	stated 	a 	willingness 	to
"discuss 	an 	economic proposal 	which 	is
subject 	to 	the 	availability of 	funding" 	with
ACSA 	"at 	any 	time."
At our June 	13 meeting, 	you 	asked ACSA 	to
list 	its 	priorities 	for 	the 	expenditure of
funds 	if 	a 3 	percent 	compensation 	increase
were 	available. 	You made 	it 	clear 	that 	you
were 	willing 	to 	"discuss" 	but would 	not 	yet
"meet 	and 	confer" 	as 	required 	by 	law.
You 	also made 	it 	clear 	on June 	13 	and 	in our
subsequent 	conversations 	that 	you would 	not
make 	an 	initial 	monetary 	proposal 	until
after 	the Legislature 	adopts 	the 	budget 	and
the Governor 	specifies 	his 	intentions
regarding 	blue-penciling 	compensation
increases 	(or maintenance of benefits) 	for
state employees. 	As you know, 	ACSA's
position 	is 	that 	the SEERA 	requires 	the
state 	to 	"endeavor 	to 	reach 	agreement" 	on
compensation 	"prior 	to 	the 	adoption" 	of 	the
budget, 	subject of 	course 	to the possibility
that 	the Legislature may 	not 	adopt 	the
resultant MOU's.
Unless 	you 	inform us 	to 	the 	contrary, 	we
interpret 	your June 	21 	letter 	to mean 	that
your 	position on June 	13 	remains 	unchanged
regarding 	your 	unwillingness 	to meet 	and
confer 	on economic 	issues.
As 	stated 	in my June 	16 	letter, 	we 	are 	still
anxiously 	awaiting 	your 	initial 	economic
proposals. 	When 	you 	are 	prepared 	to meet
and 	confer 	with ACSA on 	these 	items, 	we wish
to 	begin 	immediately.
Prior 	to the end of June, 	said Mosman, 	the 	strategy was
Q. 	Prior 	to June 	30, 	did you offer 	to
discuss 	economic 	proposals 	on 	a 	"subject 	to
availability of 	funds 	basis" 	with ACSA?
A. 	Yes, 	I did. 	We had hoped, 	and I 	had
told ACSA, 	you 	know, 	in our 	earlier 	sessions
that I 	had hoped 	that, 	you know, 	by early
June 	that 	the 	budget 	picture would 	have
16

sufficiently 	crystalized 	that 	we 	could 	begin
to discuss, you know, 	economic proposals.
As 	it 	turned 	out 	in 	early June 	things 	were
still, 	you know, way up in the air. 	The
amount 	of 	money 	that 	it 	appeared 	the
Legislature 	was 	going 	to come 	up with 	far
exceeded 	what 	the Governor 	felt 	he 	could
live with. 	So, 	we 	knew at 	that 	time that we
could 	not put, 	you know, 	a 	firm economic
offer 	because we 	still 	didn't 	know whether
the 	money would 	be 	there. 	But 	the 	approach
that 	we 	took with 	all 	of 	the 	unions 	was
basically 	to 	talk 	at 	least 	to 	get 	some
dialogue 	going, 	just 	starting 	to talk 	in
terms 	of 	figures 	like 	if 	there were
3 percent, 	5 percent available, 	how would
you want, 	you know, 	where would you want
that money 	to go, 	what 	types of benefits 	are
of priority to you, 	do you want 	it 	in
salary, 	whatever, 	so that we could begin to
get 	to 	some 	sense 	of 	where 	their 	priorities
were 	on 	the 	part 	of 	the 	unions 	so 	that we
knew when what money 	became 	available, 	you
know, 	where 	their priorities would be. 	Now,
as I 	understand 	it, 	you know, 	with some of
the 	unions 	they were, 	that 	approach was
utilized. 	With ACSA, 	they chose 	not to.
They 	didn't want 	to discuss 	economics 	on
those 	terms.
Q. 	Did 	they 	express 	any 	reasons 	why?
A. 	They 	just 	basically 	said 	unless 	you 	can
put, 	you 	know, 	a hard money offer on the
table, 	we don't want 	to talk about. 	And we
don't want 	to meet, 	you know, 	until you can.
According 	to Richard Baker, 	whose 	testimony was 	unrefuted,
the 	Senate 	Finance 	Committee 	ended 	deliberations 	in 	late May
after 	the Assembly 	had 	approved 	its 	version of 	a 	budget. 	The
Assembly's 	version was 	$100 	million more 	for 	public employees'
salaries 	than 	in 	the Governor's 	budget. 	The Senate 	version on
employees' 	salaries 	was $100 million more plus 	$1,000 	than 	in
the Governor's 	budget. 	This 	difference 	required 	the matter 	of
17

state 	employees' 	salaries 	to go 	to 	a 	conference 	committee.
Conference 	rules, 	explained Baker, 	prohibited 	the committee
from passing 	a 	budget 	with 	figures 	either 	lower 	than 	the 	lowest
or 	higher 	than 	the 	highest 	of 	either 	house's version. 	The
conference 	committee 	started 	its 	deliberation on June 	9. 	After
a couple of 	conferences, 	a 	report 	was 	issued on June 	23 which
represented State 	employees' 	compensation 	in a 	final version,
said 	Blanning.
The 	final 	joint 	conference 	committee 	report was, 	said
Mosman, 	"totally 	unacceptable 	to the Governor. 	And I 	think
that 	the 	Governor 	largely 	felt 	that 	there 	probably wasn't 	going
to 	be 	a whole 	lot more 	negotiating 	going 	on with 	the
Legislature, 	so he 	decided 	to go with 	a certain amount 	of money
for 	employee 	compensation." 	DPA 	started 	with 	basically 	the
same 	economic package 	for 	all 	the 	units.
Mosman 	explained 	why 	DPA 	did 	not 	place 	any 	economic
proposals 	on 	the 	table before June 	30.
Q. 	Mr. 	Mosman, 	why was 	the Department of
Personnel Administration 	unwilling 	to put 	a
firm 	economic 	proposal 	on 	the 	table 	prior 	to
June 30, 1983?
A. 	As 	there 	has 	been 	testimony 	earlier 	in
the 	day, 	this was 	an extremely difficult
budget 	year 	for 	the State of California. 	In
fact, 	we 	ended 	up with 	a 	budget 	deficit
somewhere 	in 	the 	neighborhood 	of 	$800
million 	going 	into 	the 	83-84 	fiscal 	year.
As 	such, 	there was 	a need 	for 	some 	definite
austerity on he 	part 	of 	the State 	of
California 	in a 	variety of 	program areas.
The State 	employee 	compensation 	is 	a 	very
18

large 	element of 	the State's 	total 	budget.
And 	as 	such, 	it's 	a very important 	element
in 	developing 	a 	total 	budget 	package 	for 	the
State 	of California. 	In this particular
year 	the Governor, 	frankly, 	was 	not able 	to
make 	any 	final 	policy decisions 	relating 	to
employee 	compensation 	until 	relatively 	late
in the 	process, 	until 	all of 	the pieces
began 	to 	fit 	together, 	and he 	had 	a better
handle 	on 	exactly 	how much 	money 	could 	be
made 	available.
The 	parties 	then met on June 	30. 	That 	afternoon DPA
conveyed 	a 	"counterpropsal" 	to ACSA. 	It 	provided 	economic
offers 	of: 	maintaining health 	benefits, 	state dental plan,
MSA's 	and 	a 	2 	percent 	salary 	increase. 	DPA's 	offer 	further
required ACSA 	to 	agree 	to DPA's 	proposals 	on 	bereavement 	leave,
arbitration 	language, 	vacation 	and 	the 	entire 	agreement.
Around 	7:00 	p.m. 	ACSA 	countered 	with 	a 	salary 	increase 	of
20 	percent. 	The 	bar 	dues 	issue was 	revised 	to request
reimbursement 	of State 	bar 	dues 	only. 	The 	request 	for 	vision
coverage 	and 	the 	alternative 	plan, 	the 	proposal 	on 	dental 	plan
with 	retention of 	the 	first 	year 	provision were 	deleted. 	ACSA
agreed 	to DPA's 	proposal 	(June 	30) 	on merit 	salary 	increases
and 	incorporated 	the 	tentative 	agreement 	on 	education 	and
training 	reached May 	10. 	ACSA 	retained 	as 	part 	of 	the 	counter
offer 	the 	$50 	PERS 	contribution 	by 	the State 	during 	the 	1983-84
year, 	and 	revised 	the 	three 	new 	items 	including layoff, 	agency
shop 	and 	obligation 	to meet 	and 	confer.
At 	7:30 	p.m. 	the 	DPA 	countered 	with 	their 	afternoon
proposal modified 	by 	revising 	the 	state 	dental plan, 	the
19

arbitration 	language 	and 	increasing 	salaries by 	3 	percent.
Mosman 	told 	them 	the 	Governor 	was 	going 	to 	blue 	pencil
$1.2 	billion 	from 	the 	budget 	and 	so 	the 	constraint 	was 	fiscal.
ACSA 	countered 	at 	8:30 	p.m. 	dropping 	their 	salary 	demand 	to
5 	percent 	with 	an additional 	15 	percent 	to be effective 	in
June 	1984. 	The 	proposal 	included 	accepting DPA's June 	30
proposal 	on 	health 	benefits 	and 	merit 	salary adjustments,
giving department option of pay or 	time off 	for 	overtime;
deleting 	technical 	adjustments 	to 	retirement 	credits 	and
modifying 	the 	three 	new 	items.
DPA countered 	again 	at 	10:30 	p.m. 	Again 	it was 	the 	initial
proposal 	but 	modified 	by giving 	a 	5 	percent 	salary 	increase
effective January 	1, 	1984, 	granting 	extra per 	diem for 	certain
zip 	code 	areas 	and 	required ACSA's 	agreement 	to 	the 	four 	items
listed 	above.
ACSA perceived 	the DPA 	change 	in 	salary 	from 3 	percent 	for
the 	entire 	year 	to 5 	percent 	for 	only half 	the year 	as
"movement 	backward 	and 	game 	playing." 	Yet Blanning 	admitted
that 	the 	5 	percent 	offer 	created 	a 	larger 	base 	pay 	for 	the
beginning 	of 	the 	next 	year 	upon which 	negotiations 	would 	be
addressed. 	The 	per 	diem 	item was 	not 	a 	big 	concession 	said
Blanning.
Mosman 	asked 	if ACSA was 	threatening 	to walk 	out. 	ACSA
said 	no 	— 	just 	thought 	that 	negotiations 	were 	not 	productive.
20
.

Around 	11:00 	p.m. 	the DPA made 	another 	counterproposal 	by
giving 	a 6 	percent 	salary 	increase 	effective January 	l f 	1984,
extra 	per 	diem 	in 	specified 	zip 	code 	areas 	and 	revised 	the
arbitration 	language.
Mosman 	and Blanning 	spoke 	in 	the 	hallway 	and Mosman
informed 	Blanning 	that 	the Legislature 	would 	not 	pass 	a 	budget
that 	evening. 	Blanning 	expressed 	the 	belief 	that DPA's
proposal 	was 	the 	same 	as 	given 	to 	other 	bargaining 	units. 	They
agreed 	to meet 	the 	next 	day.
At 	1:15 	p.m. 	the 	next 	day 	(July 1) 	ACSA extended 	a
counterproposal. 	The 	salary 	increase was 	to be 	10 percent
effective January l, 1984, 	with 	an 	additional 	10 	percent
June 1, 	1984.
DPA 	then 	countered 	offering 	a 	6 	percent 	salary 	increase
effective January 1, 	1984, 	extra 	travel expenses 	in specified
zip code 	areas 	and 	to extend 	the 	$50 	retirement 	contribution 	to
December 	31, 	1983. 	The non-economic 	items 	(ACSA must 	agree 	to)
had 	the 	earlier 	proposal 	with 	"withdrawal 	of 	unfair 	practice
charges" 	added. 	The 	instant 	unfair 	practice 	charge was 	among
those 	on 	file 	by ACSA. 	Mosman 	told ACSA 	there 	was 	still 	no
budget, 	and 	regarding dollars, 	this was 	the 	"bottom line" 	and
that ACSA would 	not 	get 	any more 	by holding out. 	He 	suggested
they meet 	again 	after 	a 	budget 	had 	been 	adopted.
The parties met 	again on July 12, 	at 	1:00 p.m. 	Mosman 	told
ACSA 	the DPA planned 	to 	go 	the Legislature 	the 	next 	day with 	a
21

bill 	to 	implement 	the MOU. 	The Legislature was going 	to
adjourn on July 	15 	and Mosman made 	it 	clear 	that 	his 	offer 	was
not 	going 	to change. 	He 	agreed 	to commit 	to 	reopen 	salary 	if
CSEA was 	successful 	in getting 	a 	larger 	than 	6 	percent 	general
increase or 	if 	there 	was more 	than $337 	million 	in 	the
finalized budget 	for 	state employees' 	salaries.
ACSA conveyed 	a 	counterproposal 	calling 	for 	a 	10 	percent
salary increase effective April 	1, 	1984, 	the $50 	contribution
to PERS extended to April 1, 	1984, 	paid bar dues, 	two days 	for
professional education, 	fair 	share, 	and 	side 	letters on
30 	percent 	staffing 	ratios 	and 	separately, 	ACSA might 	reopen 	if
CSEA got more 	than 	6 	percent 	or 	state 	budget 	was 	over 	$337
million 	for 	salaries.
Blanning 	said ACSA 	had 	learned 	that 	another 	unit 	had 	agreed
to 6 	percent 	salary 	increase 	in January plus 	3 	percent 	in
April, 	and 	still 	another 	unit 	had 	agreed 	to 6 percent 	plus
4 	percent. 	ACSA was 	reluctant 	to 	settle 	for 	less 	than what
others 	got. 	Mosman 	told 	him 	that DPA would 	not 	revise 	the
proposal. 	In 	the hallway discussion, 	Mosman 	indicated 	that 	he
might 	be 	able 	to 	throw 	in bar 	dues 	if 	it meant 	that 	they had
agreement. 	Blanning 	suggested 	that 	if Mosman 	kicked 	in 	agency
shop, 	that 	they might get 	somewhere. 	At that point, 	said
Mosman, 	things 	broke 	down 	and Mosman 	suggested 	they 	request 	a
mediator. 	Mediation was 	discussed 	but 	the 	parties 	did 	not
request 	it.
22

On July 	22, 	Blanning wrote 	to Mosman 	confirming 	a meeting
on August 	4 	and 	that Mosman 	had 	called 	the July 	1 	proposal 	his
"last 	and 	final 	offer" 	and 	requesting mediation 	immediately.
A 	state 	budget 	was 	finally 	adopted 	by 	the 	Legislature 	on
July 	19. 	The Governor 	took 	final 	action on 	the 	budget on
July 21. 	Employee 	compensation was 	cut 	to 	the 	original
$337 	million. 	ACSA was 	active 	in 	attempting 	legislative
override of 	the 	cut 	in proposed employees' 	salaries. 	The
effort was 	not 	successful.
At 	the 	request 	of 	the DPA, 	mediation was 	ordered 	by PERB.
The 	parties met on August 	4 	without a mediator 	but, 	said
Mosman, 	they were 	deadlocked. 	At 	a 	session on September 	7 	the
parties, 	working 	through 	the mediator, 	reached 	agreement 	in
principle 	and memorialized 	it 	on September 	7. 	The 	agreement
between 	the 	parties 	included 	a 6 	percent 	salary 	increase
effective January 1, 	1984, 	bar 	dues 	reimbursed 	up to $200 per
year, 	increased 	vacation 	hours 	earned 	per 	month 	and 	increased
vacation 	carryover 	from 320 	to 	400 	hours.
Summary
The 	following 	findings 	can 	be 	drawn 	from 	the 	evidence 	that
foreshadow 	conclusions 	drawn 	hereafter.
1. 	Mosman 	did 	not 	have 	authority 	to offer 	economic
proposals on 	any money 	items 	until June 	30, 	1983.
While Mosman 	testified 	that 	he 	had 	authority 	to 	negotiate
on 	behalf 	of 	the Governor, 	he 	did 	not 	deny 	telling Blanning 	as
23

early as May 	10 	that he was 	not 	there 	to negotiate. 	He 	could
not 	recall making 	such 	a 	statement. 	DPA offered 	no 	rebuttal 	to
Blanning's 	testimony 	that 	only Mike 	Frost, 	the 	director 	of DPA,
had 	money 	authority. 	In addition, 	Mosman's 	testimony confirms
that 	the 	Governor's 	strategy was 	not 	to negotiate 	economic
matters 	until 	the 	legislative process 	was 	complete. 	Finally,
confirmation of 	lack 	of 	authority on Mosman's part 	is 	his
telling 	testimony 	set 	forth 	on 	page 	18, 	herein 	describing 	the
Governor's 	reaction 	to 	the 	joint 	conference 	committee 	action 	in
late June. 	The Governor, 	said Mosman, 	felt 	there wasn't going
to 	be 	a 	lot 	of 	negotiating 	going 	on with 	the Legislature 	so he
"decided 	to go 	with 	a 	certain 	amount of 	money 	for 	employee
compensation."
2. 	DPA did agree, 	prior 	to June 30, 	1983, 	to:
a. 	Groundrules 	for 	negotiations,
b. 	Resolution of 	staffing 	ratios 	by committee
referral,
c. 	Incorporation of 	training 	programs 	into 	the MOU
(thereby 	making 	such 	matters 	subject 	to 	the 	grievance
procedure).
3. 	DPA did 	place 	economic offers 	on 	the 	table 	on June 	30
and 	in 	successive 	sessions moved 	from 	its 	initial 	bargaining
position.
ISSUE
The 	issue 	in 	this case 	is 	whether 	the 	Department of
Personnel Administration, 	as an agent of the Governor, 	violated
24

the 	provisions 	of 	the SEERA when 	it 	refused 	to 	negotiate
economic 	items 	until 	June 	30, 	1983.16
16	16The	The 	Issue 	of Scope
At 	the 	formal 	hearing, 	DPA objected 	to evidence 	regarding
its 	position on 	nonnegotiability of 	certain 	items. 	DPA's
objection was 	based 	upon ACSA's 	amendment 	of 	the 	unfair
practice 	charge. 	After 	argument 	by 	the 	parties 	on 	the 	issue,
the 	undersigned 	requested 	the 	parties 	to 	address 	the 	issue 	in
post-hearing 	briefs. 	ACSA did 	not 	brief 	either 	the 	underlying
scope 	question or 	the 	question of 	the 	effect of 	its 	amended
unfair 	practice 	charge. 	DPA did 	not brief 	the 	issue, 	but did
note 	that ACSA 	waived 	the 	issue 	by 	failing 	to brief 	the 	matter.
A 	review 	of 	the 	documentation 	and 	evidence 	presented 	leads
to 	the 	conclusion 	that ACSA 	has 	removed 	the 	scope 	question 	as 	a
viable 	issue 	in 	this 	case. 	The 	original 	unfair 	practice 	charge
cited 	various 	allegations 	of DPA's 	conduct 	as 	demonstration of
bad 	faith 	bargaining. 	ACSA 	alleged 	that 	the DPA 	had
unilaterally 	imposed 	a 	freeze on promotions, 	and 	refused
. . . 	to 	bargain 	about 	matters 	which 	clearly
are within scope, 	including 	but not 	limited
to promotions, 	the content of health
benefits 	and 	retirement 	benefits, 	agency
shop, 	and staffing ratios.
The Complaint 	issued on this charge, 	however, 	did not 	refer
to 	questions 	of 	scope 	but 	rather 	framed 	the 	issues 	as 	refusal
to 	bargain on 	"matters 	requiring 	the 	expenditure of 	funds" 	and
"failure 	to 	invest 	the 	DPA 	negotiator 	with 	sufficient
authority." 	ACSA's 	amendment 	to the 	charge, 	filed after 	the
Complaint was 	issued, 	was 	precisely 	the 	same 	pleading 	as 	the
original 	charge 	with 	identical 	supporting 	declarations, 	with
the 	exception 	that 	reference 	to 	the 	freeze 	and 	to 	the 	scope
questions 	were 	deleted. 	(Also deleted 	was 	a 	request 	by ACSA
for 	injunctive 	relief.) 	The 	amended Complaint 	simply
incorporated 	the 	amended 	unfair 	practice 	charge. 	Nowhere 	in
the Complaint 	or 	the 	amended 	unfair 	practice 	charge 	or 	the
amended 	complaint 	is 	the question of 	scope presented. 	In
addition, 	ACSA 	requested 	a 	very 	limited 	remedy 	during 	the
formal 	hearing 	(bargain 	in 	good 	faith 	before 	the 	constitutional
deadline). 	Moreover, 	Charging Party objected to the
introduction 	of 	evidence 	following July on 	the 	pretense 	that
their 	case was 	a 	refusal 	to 	bargain 	case 	insofar 	as DPA's
25

DISCUSSION
Position 	of 	the Parties
ACSA 	argued 	violation 	of 	the 	SEERA 	under 	three 	theories.
First, 	it 	argued 	that 	section 	3517 	requires meeting 	and
conferring 	in good 	faith 	before 	a 	final 	decision 	is made 	by 	the
Governor 	regarding 	the 	amount 	of 	money 	to 	be made 	available 	for
employee 	compensation, 	and 	that SEERA 	contemplates 	good 	faith
effort 	to 	reach 	agreement 	before 	adoption of 	the 	final 	budget
with 	adequate 	time 	for 	resolution of 	impasse. 	Thus, 	agreement
or 	impasse 	should 	have 	been 	reached 	long 	enough 	prior 	to
June 	15 	to 	allow 	impasse 	procedures 	a 	"fair 	chance 	to work."
Tracing ACSA 	efforts 	through 	the 	negotiating 	sessions 	and 	the
failure 	of DPA 	to offer 	economic 	items 	until June 	30, 	ACSA
finds 	basis 	for 	a violation. 	Secondly, 	ACSA argued 	the 	refusal
to 	bargain 	until 	after 	the 	limits 	set 	by Government Code
section 	3517 	was 	a per 	se 	refusal 	to bargain. 	Finally, 	ACSA
argued 	that 	the 	record 	supports 	a 	finding 	of 	bad 	faith
bargaining 	on 	"totality 	of 	conduct."
DPA 	argued 	that 	fiscal 	necessity precluded 	the 	placing 	of
economic 	proposals 	on 	the 	table. 	It 	contended 	that:
refusal 	to 	bargain prior 	to 	the 	deadline 	set 	forth 	in 	the
Constitution. 	All of 	these circumstances 	justify a
determination 	that ACSA 	has 	waived 	and/or 	abandoned 	the 	pursuit
of 	the scope 	issue 	in 	this 	case. 	This 	conclusion 	is 	further
justified 	by ACSA's 	failure 	to brief 	the 	question 	in 	response
to DPA's 	objection 	to 	the 	evidence 	on 	the 	question.
26

. 	. 	. 	the severe economic situation facing
the 	state 	in 1983, 	coupled with 	the dynamics
in 	the Legislature 	concerning major 	segments
of 	the 	proposed 	1983-84 	fiscal 	year 	budget
made 	it 	impossible 	for 	the 	state 	to
determine 	the 	amount 	of money 	that 	would 	be
available 	to 	fund 	increased 	state 	employee
benefits 	in 	the 	context of 	a $22 	billion
budget. 	(Post-hearing Brief 	- page 	21.)
DPA 	further 	argued 	that 	in 	fact 	it did place 	proposals 	on
the 	table 	before 	the 	budget 	was 	adopted 	and 	did 	in 	fact make
concessions 	in negotiations.
Under 	subsection 3519(c) 	it 	is 	an 	unlawful practice 	for 	the
employer 	to 	refuse 	or 	fail 	to meet 	and 	confer 	in 	good 	faith
with 	a 	recognized 	employee 	organization. 	Section 	3517 	requires
the Governor, or his 	representative, 	to
. 	. 	. 	meet and confer 	in good 	faith
regarding wages, 	hours, 	and other 	terms and
conditions 	of 	employment 	with
representatives 	of 	recognized 	employee
organizations, . . .
The Governor 	is 	required 	to
. 	. 	. 	consider 	fully such presentations 	as
are made 	by 	the 	employee 	or 	organization on
behalf of 	its members 	prior 	to arriving 	at 	a
determination of 	policy or 	course 	of 	action.
Good 	faith 	is 	imposed 	upon 	both 	parties 	in meeting 	and
conferring, 	and that means:
. 	. 	. 	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
27

budget 	for 	the 	ensuing 	year. 	The 	process
should 	include adequate time 	for 	the
resolution of 	impasses.
ACSA's posture 	is 	that 	the 	meet 	and 	confer 	obligation 	is
fixed 	by 	the Constitutional mandate 	for 	budget 	adoption 	by 	the
Legislature. 	Since 	the Legislature 	is mandated 	to adopt 	a
budget 	by June 	15 	and 	the 	Governor 	by June 	30,17 ACSA 	would
require 	agreement or 	resolution of 	impasse 	by June 	15. 	In 	the
absence 	of 	either 	it would 	have 	a violation of SEERA.
The 	DPA 	argued 	that 	constitutional 	guidelines 	are 	not
imposed 	by 	section 	3517. 	It 	argued 	that 	section 	3517 	requires
good 	faith before 	the 	"final decision" 	- 	that 	is, 	prior 	to
adoption 	by 	the 	state 	of 	its 	final 	budget 	for 	the 	ensuing
year. 	"Final decision" 	requires 	final 	adoption of 	the 	budget.
In 	the 	context 	of 	the 	state's 	budget 	process 	this 	would 	be 	the
date 	on which 	the Governor 	completes 	final 	action on 	the 	budget
sent 	to him by 	the Legislature. 	Economic proposals were 	first
placed on 	the 	table June 	30. 	The 	budget was 	not 	submitted 	to
the 	Governor 	until July 	19. 	The Governor 	completed 	action on
July 21. 	Thus, 	the State met 	and 	conferred 	three weeks before
final 	action was 	taken. 	In addition, 	argued DPA, 	impasse could
have 	been 	completed 	21 days 	from 	the 	time 	an economic offer 	was
made 	and 	final 	action was 	taken by 	the 	Governor.
17ACSA 	cited 	none 	and 	I 	find 	no 	authority on 	this 	latter
contention.
28

I 	decline 	to 	read ACSA's mandate 	into 	section 	3517.
Imprimis, 	the 	statute 	imposes 	upon the parties 	the mutual
obligation only 	to 	"endeavor" 	to 	reach 	agreement 	prior 	to
adoption 	by 	the 	state, 	as opposed 	to 	the Legislature of 	its
final 	budget. 	Endeavor 	means 	to 	try 	— 	not 	that 	agreement
shall 	be 	reached.18 As 	was 	stated 	in Dublin Professional
Fire Fighters, 	Local 	1885 	v. Valley Community Service District,
C.19 	45 	CA.3d 	116, 	interpreting 	similar 	language 	in section
350519
18Funk 	and 	Wagnalls 	Standard 	College 	Dictionary 	defines
"endeavor:" 	"An 	attempt or 	effort 	to do or 	attain 	something;
earnest 	exertion 	for 	an 	end."
19Section 	3505 	provides 	in part:
"Meet 	and 	confer 	in good 	faith" 	means 	that 	a
public agency, 	or 	such 	representatives 	as 	it
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 	public 	agency of 	its
final budget 	for 	the 	ensuing 	year. 	The
process 	should 	include 	adequate 	time 	for 	the
resolution 	of 	impasses 	where 	specific
procedures 	for 	such 	resolution 	are 	contained
in local rule, regulation, or ordinance, or
when 	such 	procedures 	are 	utilized 	by mutual
consent.
This 	section 	is within 	the Meyers-Milias-Brown Act 	(MMB),
applicable 	to 	local public 	agencies.
29

. 	. 	. 	the obligation in proper cases, 	to
"meet 	and 	confer 	promptly upon 	request" 	is
absolute, 	while 	the 	statutory admonition 	to
"reach 	agreement" 	before 	the 	adoption of 	the
budget 	is 	only hortatory.
The 	court 	noted 	that 	"agreement may 	not be 	reached 	at all" 	as
the 	statute 	recognizes 	in 	stating 	that 	the 	negotiators 	should
"endeavor" 	to 	reach 	agreement 	before 	the 	budget 	is 	adopted.20
Secondly, 	the 	overture 	focuses 	upon 	"prior 	to 	the 	adoption
by 	the 	state 	of 	its 	final budget 	for 	the 	ensuing 	year."
"State" 	is not defined 	in SEERA. 	Government Code 	section 18
provides 	that 	"State" 	is 	the 	"State of California, 	unless
applied 	to 	the 	different 	parts of 	the 	United States. 	. . . "
"State" 	is not 	synonymous with 	"Legislature," 	or 	the
20Additional provisions 	in SEERA, 	not 	found 	in the MMB,
reveal 	contemplation 	that 	agreement might 	be 	reached 	before 	the
Budget Act 	is 	adopted 	by 	the Legislature.
Section 3517.6 	provides 	in pertinent part:
. . . 	if 	any 	provision 	of 	the 	memorandum of
understanding 	requires 	the 	expenditure 	of
funds, 	those 	provisions of 	the memorandum of
understanding 	shall 	not 	become 	effective
unless 	approved 	by 	the Legislature 	in 	the
annual Budget Act.
Finally, 	section 3517.7 provides:
If 	the Legislature 	does 	not 	approve or 	fully
fund 	any 	provision 	of 	the 	memorandum of
understanding 	which 	requires 	the 	expenditure
of 	funds, 	either 	party may 	reopen
negotiations on all or 	part of 	the
memorandum of 	understanding.
These provisions, 	however, 	do not require agreement before
the 	budget 	act 	is 	adopted 	by 	the Legislature.
30

Legislature 	would 	have 	so 	stated. 	As 	a practical matter 	the
Budget 	is 	finalized 	when 	the 	Governor 	takes 	final 	action 	in
approving 	the Budget. 	That 	action 	finalizes 	the Budget 	unless
the Legislature, 	by two-thirds majority, 	overrides 	his
actions. 	Either 	interpretation of 	adoption of 	a budget, 	by the
Legislature, 	or 	upon 	action of 	the 	Governor 	leads 	to 	the 	same
result 	in 	this 	case. 	The Legislature 	passed 	the Budget Act on
July 	19. 	The Governor 	took 	action on July 	21. 	On June 	30,
prior 	to 	either 	event, 	DPA was making 	firm economic offers 	at
the 	negotiating 	table.
In sum, 	section 	3517 	requires 	the 	parties 	to 	try 	to reach
agreement 	at 	a 	time 	early 	enough 	to 	precede 	the 	enactment 	of 	a
budget. 	It does 	not 	appear 	that 	the 	legislative 	intent was 	to
impose 	rigid 	dates 	by which 	agreement 	was 	to 	be 	reached or
impasse 	completed, 	failure of which 	to observe 	would
automatically 	result 	in 	violation of 	the SEERA. 	ACSA's 	first
theory of 	violation 	is 	therefore 	rejected.
The 	Department's 	Negotiating 	Conduct
ACSA 	contends 	that DPA committed a per 	se violation 	and 	by
the 	totality of 	its 	conduct 	violated 	the SEERA. 	DPA 	contended
that 	it 	never 	refused 	to 	bargain but 	rather 	took 	the 	position
that 	it 	could 	not 	negotiate 	until 	the 	state's 	financial
position 	became more 	clear.
PERB 	utilizes 	both 	the 	"per 	se" 	and 	"totality of 	the
conduct" 	tests 	to 	ascertain whether 	a party's 	negotiating
31

conduct 	constitutes 	an 	unfair 	practice. 	Stockton Unified
School District 	(11/3/80) 	PERB Decision No. 	143. 	The
distinctions 	between 	the 	two 	tests 	was 	delineated 	in Pajaro
Valley Unified School District 	(5/22/78) 	PERB Decision No. 	51.
Said 	the 	Board:
The 	National Labor 	Relations Board
(hereafter NLRB) 	has long held 	that 	[a duty
to bargain 	in good 	faith] 	requires 	that 	the
employer 	negotiate 	with 	a 	bona 	fide 	intent
to 	reach 	an 	agreement. 	In re Atlas Mills,
Inc. 	(1937) 	3 	NLRB 	10 	[1 	LRRM 60] The
standard 	generally 	applied 	to 	determine
whether 	good 	faith 	bargaining 	has 	occurred
has 	been 	called 	the 	'totality of 	conduct'
test. 	See NLRB 	v. 	Stevenson Brick 	and Block
Co. 	(4th Cir. 	1968) 	393 F.2d 234 	[68 LRRM
-2086] 	modifying 	(1966) 	160 NLRB 198 	[62 LRRM
1605]. 	This 	test 	looks 	to the entire course
of 	negotiations 	to 	determine 	whether 	the
employer 	has 	negotiated 	with 	the 	requisite
subjective 	intention 	of 	reaching 	an
agreement.
There 	are certain acts, 	however, 	which have
such 	a 	potential 	to 	frustrate 	negotiations
and 	to 	undermine 	the 	exclusivity of 	the
bargaining 	agent 	that 	they 	are 	held 	unlawful
without 	any 	determination 	of 	subjective 	bad
faith on 	the 	part of 	the 	employer.
The 	latter 	violations 	are 	considered 	per 	se 	violations.
NLRB v. 	Katz 	(1962) 	369 U.S. 	736 	[50 LRRM 2177]. 	Examples of
per 	se violations 	are; 	unilateral changes 	in terms 	and
conditions 	of 	employment 	otherwise 	subject 	to negotiations,
NLRB 	v. 	Katz, 	supra, 	San Mateo County Community College
District 	(6/8/79) 	PERB Decision No. 	94; 	outright refusal to
bargain 	a matter 	within the 	scope of 	representation, 	NLRB 	v.
Katz, 	supra, 	Sierra Joint Community College District 	(11/5/81)
32

PERB Decision No. 	179, John S. 	Swift & Co. 	(1959) 	124 NLRB 394
[44 LRRM 1388]; 	unilateral 	insistence 	on public negotiations
Ross School District 	(2/21/78) 	PERB Decision No. 	48; 	or
conditioning 	agreement 	upon 	the 	union's 	abandonment 	of 	its
right 	of 	representation 	at 	the 	informal 	level of 	grievance
processing, Modesto City Schools 	(5/5/83) 	PERB Decision No. 	291,
1. 	The 	per 	se 	theory.
DPA 	cannot 	be 	said 	to 	have 	outright 	refused 	to 	bargain 	but
rather 	sought 	to defer 	bargaining 	until 	the 	legislative 	process
was 	completed. 	Deferring 	negotiations 	is 	permissible 	under
some 	circumstances. 	In San Mateo Community College District
(6/8/79) 	PERB Decision No. 	94, 	the PERB noted 	". 	. 	.a party
may also defer 	negotiations, 	maintaining 	the 	status quo, 	until
information 	is 	secured 	about 	the 	effects 	of 	a 	serious 	financial
change," 	citing NLRB v. 	Minute Maid Corp. 	(5th Cir. 	1960) 	283
F.2d 	705 	[47 	LRRM 2072]. 	There 	a citrus 	freeze prompted 	the
employer 	to 	request 	deferral 	of 	negotiations 	until 	the
financial 	aspects 	of 	damage 	from 	the 	freeze 	could 	be
ascertained. 	Here, 	the Governor's position was 	to have 	an
overall 	budget 	of $22 	billion dollars. 	His 	obligation 	to
bargain 	with ASCA did 	not 	require 	him 	to 	yield 	this 	position.
NLRB 	v. 	Herman Sausage 	(5th Cir. 	1958) 	275 F.2d 	229 	45 LRRM
2829; 	Oakland Unified School District 	(11/2/81) 	PERB 	Decision
No. 	178. 	Faced 	with other 	high 	cost 	items 	(education and
welfare), 	in addition to employee compensation, 	the
33

administration 	sought 	resolution 	of 	those 	items 	with 	the
Legislature, 	before 	firming offers 	to 	the 	employee
representative. 	The 	SEERA 	statutory 	scheme would 	have 	provided
the Governor 	ostensible 	relief 	from an 	agreement consummated
before 	the Budget Act was 	passed 	(subsection 	3517.6 	provides
that 	such 	agreement 	is 	not effective 	until 	the Legislature
approves 	it, 	and 	subsection 3517.7 	provides 	that 	if 	the
Legislature 	does 	not 	approve 	then 	either 	party may 	reopen
negotiations, 	see footnote 20, 	supra). 	Yet, determined to
limit 	the 	budget 	to $22 	billion, 	and 	faced with 	other 	statutory
mandates 	(e.g. 	welfare 	support 	and 	educational 	funding) 	he may
have 	been 	in 	a position of 	having 	to 	blue 	pencil 	employee
compensation 	if 	employee 	compensation 	was 	agreed 	to prior 	to
the 	time 	the Legislature passed 	the Budget Act. 	This 	would
have 	been 	reneging on his own 	prior 	agreement, 	possibly 	an
unfair practice 	itself. 	Thus, 	seeking 	to resolve 	the 	big money
items 	with 	the 	Legislature 	before 	offering 	firm economic 	offers
to ACSA cannot 	be 	a per 	se 	refusal 	to bargain.
Moreover, 	the 	DPA did 	not 	in 	fact 	refuse 	to bargain until
after 	the Legislature had passed 	the 	budget. 	Rather, 	DPA
placed offers on 	the 	table on June 	30, 	some 	20 	days before 	the
budget was 	finally enacted 	by 	the 	Legislature. 	A different
conclusion might 	result 	if 	there 	was 	an outright 	refusal 	to
bargain 	until 	after 	the 	Legislature 	did 	in 	fact 	adopt 	the
budget. 	DPA did 	negotiate 	ground 	rules 	at 	the 	first meeting, 	a
34

subject 	found 	by PERB 	to 	be within 	the 	scope of 	negotiations.
See 	Stockton Unified 	School District 	(11/3/80) 	PERB 	Decision
No. 	143. 	The parties 	agreed 	to resolve 	the 	staff 	ratio 	issue
by 	use of 	a 	committee. 	A 	tentative 	agreement was 	reached 	on
May 	10 	regarding 	training 	programs. 	There 	was 	also expressed
willingness by DPA 	to negotiate wages, 	etc., 	in 	the context of
a 	total 	compensation 	package.
Thus, 	the 	record does 	not 	support 	a 	finding of 	flat 	refusal
to bargain. 	Rather, 	amidst 	the 	fiscal uncertainty 	perceived 	by
the Governor, 	his 	negotiations with 	the Legislature 	caused
delay of 	negotiations on 	economic matters. 	As 	was 	said 	in
Mount 	Diablo Unified 	School District 	(12/30/83) 	PERB 	Decision
No. 373,
. 	. 	. 	where the parties engage 	in some
negotiating, 	the 	determination of 	whether 	an
employer 	has 	violated 	its 	duty 	to 	negotiate
in 	good 	faith 	turns 	on whether 	there 	is
sufficient 	evidence 	to establish, 	based 	upon
the 	totality of 	the circumstances, 	that 	it
lacked 	subjective 	intent 	to 	reach 	agreement
with 	the 	exclusive 	representative.
2. 	The 	totality of 	conduct 	theory.
ACSA 	argued 	that 	under 	a 	totality of 	conduct 	test DPA may
also 	be 	found 	to violate 	its 	duty 	to meet 	and 	confer. 	ACSA
offers 	the 	following:
1) 	Rejecting 	summarily ACSA's 	proposals 	regarding 	economic
items.
The 	post-hearing 	brief 	does 	not 	set 	forth 	specific 	examples
of 	any 	summary 	rejection of ACSA's 	proposals. 	Save 	for 	one
35

proposal by ACSA, 	the 	evidence 	does 	not 	support 	this
contention. 	DPA did 	reject ACSA's 	proposals 	for 	a 	separate
health plan, 	to 	fund 	certain 	items out of departmental 	savings
from attorney 	layoff 	or 	attrition, 	and 	asserted 	as 	out 	of 	scope
aspects 	of ACSA's 	health 	and 	retirement proposals. 	But 	failure
to agree, 	without more, 	is not unlawful. 	There 	is no
requirement 	that 	the parties 	agree. 	NLRB 	v. 	Highland Park Mfg.
(1940) 	110 F.2d 632 	[6 LRRM 786]; 	NLRB v. 	Reed and Prince Mfg.
Co. 	(1941) 	118 F.2d 874 	[8 LRRM 478]. 	Mosman reduced to
writing 	the 	basis 	of DPA's 	rejection of ACSA's 	proposal on
finding 	items 	from 	salary 	savings. 	As Mosman 	correctly pointed
out, 	savings 	in 	the 	1982-83 	fiscal year 	would have 	no lasting
benefit 	in 	the 	1983-84 	fiscal year. 	Layoffs 	resulting 	from
eliminating 	positions 	does 	not 	carry 	forward 	any 	departmental
savings or 	funds 	to pay 	for 	other 	items. 	Even 	as 	to 	the 	scope
issue, 	Mosman 	did 	not 	take 	a 	rigid posture 	but conferred 	with
counsel, 	wrote 	to ACSA about 	the position 	and 	then 	agreed 	to
confer 	with 	counsel 	again. 	DPA expressed 	in writing 	a
willingness 	to discuss many of ACSA's 	proposals 	either 	in 	the
context 	of 	a 	total 	"compensation package" 	and/or 	at 	such 	time
as 	the 	final picture was more certain. 	DPA's position, 	openly,
was 	to defer 	negotiations 	until 	the 	budget picture 	was
resolved. 	In 	the 	context 	of 	negotiations 	only on 	reopener
proposals, 	the majority of 	items 	of which had 	financial
implications, 	this posture 	did 	not amount 	to 	summary rejection
of ACSA's proposals.
36

2) 	Offering 	a wage proposal on a 	"take 	it or 	leave 	it
approach 	and 	in 	fact 	the 	only offer 	on wages."
The 	facts 	do 	not 	bear ACSA's 	depiction of 	such
intransigence 	by DPA. 	DPA 	started 	at 2 	percent 	on June 	30 	and
moved 	through 	successive 	incremental 	increases 	of 	3 	percent 	(at
7:30 p . m . ) , 	5 percent 	increase effective January 1, 	1984 	(at
10:30 p . m . ) , 	and 	then revised 	the offer 	to 6 percent effective
January 1, 	1984 	(at 	11:00 	p.m.). 	On July 	1, 	DPA offered 	a
6 	percent 	increase 	plus 	payment of 	the 	$50 	retirement
contribution 	to December 	31. 	While 	the 	span of 	time over 	which
these changes were made was less 	than 24 	hours, 	it does
represent 	a change 	in offers 	by DPA and was 	not 	a 	"take 	it or
leave 	it" 	offer. 	A party has 	the 	right 	to maintain, 	while 	in
negotiating 	posture, 	that 	its 	last offer 	has been made, 	and
that 	it will make 	no more 	concessions. 	Modesto City Schools
(5/5/83) 	PERB Decision No. 	291. 	Here, Mosman's July 1
statement was 	no more 	than 	just posturing. 	As 	the 	record
shows, 	even on July 	12 	he was 	indicating 	further 	movement was
possible 	on 	the 	chance 	that ACSA would move on 	some 	of 	their
issues. 	Mosman 	then 	agreed 	to 	reopen 	salaries 	if CSEA 	in
simultaneous 	negotiations with 	the State, 	obtained 	a 	larger
compensation package or 	if 	there was more 	than $337 	million 	in
the 	final budget. 	As 	the 	final agreement reflects, 	other
features 	were 	added 	distinguishing 	that 	agreement 	from DPA's
July 1 position. 	For example, 	reimbursement of bar dues 	and
vacation 	carryover 	were 	added.
37

3) 	Failure 	to make 	economic 	counter 	offers 	- amounting 	to
an 	insistence 	on 	unilateral 	control of 	wages 	and 	other
economic matters.
It 	is not, 	by itself, 	a 	failure 	to bargain 	in good 	faith 	to
fail 	to make 	a 	counterproposal. 	As 	was 	said 	in Oakland Unified
School District 	(11/2/81) 	PERB Decision No. 	178:
[The NLRB] 	. 	. 	. 	have also ruled that the
failure 	to make a counterproposal 	is not, 	by
itself, 	a violation of 	the National Labor
Relations Act. 	In NLRB v. 	Arkansas Rice
Growers Assn. 	(8th Cir. 	1968) 	400 F.2d 569
L69 LRRM 2119, p. 	2123], 	the Court said:
Although as 	the 	company suggests, 	it
may not 	be 	bound 	to make
counterproposals, nevertheless,
evidence 	of 	its 	failure 	to do so may be
weighed 	with 	all 	other 	circumstances 	in
considering 	good 	faith.
See 	also West Hartford Education Assn. 	v.
DeCourcy 	(1972) 	80 LRRM 2422. 	And 	in NLRB
v. 	Herman Sausage 	(5th Cir. 	1958) 	275 F.2d
229 	[45 LRRM 2829], 	the Court said:
The 	obligation of 	the 	employer 	to
bargain 	in good 	faith 	does 	not
require 	the 	yielding 	of 	positions
fairly 	maintained.
A 	flat 	refusal 	to 	reconcile 	differences 	by
failing 	to offer 	counterproposals 	could 	be
construed 	to be 	in 	bad 	faith 	if 	no
explanation or 	rationale 	supports 	the
employer's 	position. 	As we 	stated 	in
Jefferson School District 	(6/19/80) 	PERB
Decision No. 	133 at p. 	11:
[the] 	obligation 	to negotiate
includes 	expression of 	one's
opposition 	in 	sufficient 	detail 	to
permit 	the 	negotiating process 	to
proceed 	on 	the 	basis 	of mutual
understanding.
38

As 	the 	record 	shows, 	DPA did 	not 	refuse 	to make 	counter
offers, 	but 	rather 	took 	the 	position 	that 	it wished 	to defer
presenting 	economic 	offers 	until 	the 	financial 	picture 	became
more 	clear. 	Even as early as May 10, 	DPA was 	responding 	to
ACSA's proposals, 	indicating 	areas 	it would 	negotiate 	and 	areas
about which 	it had 	concern with ACSA's 	proposals. 	On June 	30,
and 	again on July 	1, 	DPA was making 	counter 	offers 	in 	response
to 	the 	issues 	that ACSA had 	raised. 	Nor 	was 	there 	an
insistence 	on 	unilateral 	control 	over 	wages 	or 	other 	economic
matters. 	In Majure Transportation Co. 	v. 	NLRB 	(CA 5, 	1952) 	198
F.2d 735 	[30 LRRM 2441], 	relied on by ACSA, 	the employer
insisted 	on 	virtual 	retention 	of 	unilateral 	control 	over 	terms
and 	conditions 	of 	employment 	in 	its 	counterproposal. 	All DPA
did here 	was 	to defer 	negotiations, 	not 	retain absolute 	control
to 	change 	terms 	and 	conditions 	of 	employment. 	DPA did 	not
insist on an 	amount 	of wages 	or 	other 	cost 	items on or 	at 	any
rate 	than what 	it offered. 	In 	the 	absence of 	acceptance 	of 	an
offer 	by ACSA, 	the 	employer 	was 	obligated 	to carry 	forth 	the
status quo. 	There 	is 	no 	indication 	that 	the 	employer 	intended
anything 	differently.
4) 	Failure 	to 	invest 	its 	agent 	with 	sufficient 	authority.
As 	the 	findings 	indicate Mosman 	could make 	no offers 	on
money 	items 	until 	authorized 	to do 	so by 	the Governor. 	This
did 	not 	occur 	until June 	30, 	when DPA placed 	its 	initial
economic offer 	on 	the 	table. 	While on 	the 	one 	hand 	the 	absence
39

of 	direct 	final 	authority 	to 	bind 	the 	employer 	is 	some 	evidence
of 	the 	lack of good 	faith 	(NLRB v. 	Coletti Color Prints, 	Inc.
(2nd Cir. 	1967) 	387 F.2d 298 	[66 LRRM 2776]; 	National
Amusements, 	Inc. 	(1965) 	155 NLRB No. 	113 	[60 LRRM 1485]; 	in
San Ramon Valley Unified 	School District 	(11/20/79) 	PERB
Decision No. 1ll, PERB 	noted 	the 	significance 	of 	such 	evidence
citing NLRB 	v. 	Fitzgerald Mills;21
If 	in other 	respects good 	faith 	is 	found 	it
is 	not 	enough 	to establish 	an 	unfair
practice 	solely 	that 	the 	representative 	of
the 	company was 	not 	empowered 	to 	enter 	into
a 	binding 	agreement.
Discussing 	issues 	and 	making 	proposals 	that 	are 	subject 	to
ratification 	does 	not violate 	the Act. 	Fry Roofing 	Company 	v.
NLRB 	(9th Cir. 	1954) 	216 F.2d 273 	[35 LRRM 2009]. 	Rather, 	it
is 	the 	absence of 	that 	amount of 	authority which 	delays 	and
thwarts 	the 	bargaining 	process 	that 	evidences 	bad 	faith
bargaining. 	Oakland Unified 	School District 	(7/11/83) 	PERB
Decision No. 	326. 	Evidence 	that 	the 	negotiator's 	limited power
was 	intended 	to or 	was 	used 	to 	foreclose 	the 	achievement of 	any
agreement 	establishes 	such 	showing. 	Capitol Transit Co. 	(1953)
106 NLRB 	169. 	Under 	these circumstances, 	it 	is concluded 	that
the 	delay 	in 	negotiations 	did 	not 	reach 	an overall 	level of 	bad
faith 	bargaining.
21(2nd Cir. 	1963) 	313 F.2d 260 	[52 LRRM 2174] 	cert.
denied 	(1963) 	375 U.S. 	834 	[54 LRRM 2312].
40

As PERB 	noted 	in Oakland 	Unified 	School 	District, 	supra,
citing NLRB 	v. 	Herman Sausage 	(5th Cir. 	1958) 	275 F.2d 229
[45 LRRM 2829] , 	"the obligation of 	the employer 	to bargain 	in
good 	faith 	does 	not. require 	the 	yielding 	of positions 	fairly
maintained." 	In 	keeping 	with 	his 	responsibilities 	in 	budget
submission 	and 	maintaining 	the 	fiscal 	affairs 	of 	the 	State,22
the Governor 	had 	the 	right 	to 	construct 	a $22 	billion dollar
budget 	and, 	subject 	to his 	obligation 	to bargain 	in good 	faith
with 	employee 	representatives, 	maintain 	that 	budget
limitation. 	Toward 	that 	end, 	he 	could 	attempt 	to work with 	the
Legislature 	in 	securing 	agreement 	on 	items 	within 	the 	budget.
After 	the Budget Act was 	passed, 	he 	had 	the 	right 	to reduce
appropriations 	to 	a 	level 	consistent 	with 	his 	budgetary
ambitions 	and 	subject 	to 	legislative override. 	See 	Government
Code 	sections 9511 	and 9512. 	In this 	case, 	the Legislature was
prone 	to provide 	for 	a 	larger 	budget 	than 	the Governor
determined 	appropriate. 	In early May, 	both 	houses 	of 	the
Legislature 	had 	approved 	employees 	compensation 	appropriations
of $1 million more 	than 	the 	amount 	proposed 	by 	the Governor.
The 	Legislature's 	budget 	proposed 	overall 	expenditures 	of 	over
a 	billion 	and 	a 	half 	dollars 	more 	than 	the Governor's 	budget.
Unlike Minute Maid Corp., 	supra, 	where 	the employer's 	revenue
22See 	for 	example Article V, 	section 	1 of 	the 	California
Constitution 	and 	generally, 	Government Code 	section 	13000
et 	seq.
41

was 	in doubt because of 	the 	citrus 	freeze, 	here 	the 	uncertainty
was 	whether 	the 	total 	cost of 	all 	legislatively 	approved
programs 	could 	be 	contained 	within 	the 	Governor's 	imposed
spending 	limit of 	$22 	billion. 	Hence 	the 	conundrum of SEERA.
The 	SEERA requires 	the 	Governor 	to meet 	and 	negotiate 	in 	good
faith with 	exclusive 	representatives on, 	among 	other 	things,
wages. 	Yet 	the Legislature 	can 	adopt 	a 	budget 	appropriating 	a
differing 	amount 	of 	employee 	compensation 	than 	that 	amount
deemed 	acceptable 	by 	the 	Governor. 	Where 	the 	Legislature
appropriates 	less 	compensation 	than 	is 	necessary 	to 	support 	a
previously consummated memorandum of 	understanding, 	the
memorandum is nullified. 	See 	footnote 20, 	supra. 	Where 	the
Governor, 	however, 	adopts a position on the budget 	that 	is
lower 	than 	the 	legislative 	version, 	no 	such 	enabling 	relief
from an 	executed 	memorandum 	is 	provided. 	To 	renege 	on 	a
previously consummated memorandum by 	blue 	penciling 	the 	amount
for 	compensation would 	be 	an 	unfair 	practice 	in 	and 	of 	itself.
In 	the 	context of 	the 	issues 	faced 	by 	the 	administration 	in
dealing 	with 	the 	Legislature 	regarding 	the 	budget 	(welfare 	and
education) 	the 	conduct of DPA up 	to June 30 	does 	not 	constitute
bad 	faith bargaining. 	If 	it 	rose 	to that level at all, 	it was
cured 	by 	the 	actions of DPA on June 	30, 	when despite 	the
absence 	of a budget or 	an agreement with 	the Legislature, 	DPA
did 	place 	offers 	on 	the 	table 	and 	did 	attempt 	to 	reach
agreement. 	Against 	the 	background 	of 	agreement 	on 	ground 	rules
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for 	bargaining, 	tentative 	agreement 	on 	training 	and 	education,
and 	the 	agreement 	to address 	staffing 	ratios 	by a committee
approach, 	the delay 	in making 	an economic proposal 	is 	not 	found
to 	be 	bad 	faith 	bargaining.
5) 	Failure 	to make meaningful 	concessions 	or 	compromises
on 	wages 	and 	other 	economic 	issues.
While 	the 	record 	reflects 	frustration on ACSA's 	part
because 	it did 	not get what 	it wanted out of 	the 	negotiations,
such 	frustration 	does 	not 	translate 	into 	bad 	faith 	bargaining
by DPA. 	ACSA wanted 	a 30 	percent 	salary 	increase. 	DPA
ultimately 	agreed 	to 	a 	six 	percent 	increase.23 ACSA 	wanted
bar 	dues 	paid 	by 	the 	employer. 	This was 	a significant 	item
from 	the 	prior 	year's 	negotiations. 	DPA 	agreed 	to pay 	for 	bar
dues, 	despite 	the 	unprecedented 	nature of 	such benefit. 	ACSA
wanted 	the 	vacation 	accrual 	formula 	to 	be 	increased 	and 	a
larger 	vacation 	carryover 	into 	the 	next 	successive 	calendar
year. 	DPA 	agreed 	to 	both 	an 	increase 	in 	the 	accrual 	and 	the
carryover. 	ACSA wanted 	staffing 	ratios 	to be 	addressed. 	DPA
agreed 	to 	attempt 	to 	resolve 	the 	issue 	via 	a 	separate 	committee
system 	and 	ultimately 	pursued 	it 	to 	the 	State Personnel Board
for 	resolution. 	ACSA 	at 	least 	wanted 	the 	educational 	training
provisions 	within 	the 	contract 	and DPA agreed 	to do 	so. 	Thus,
23This 	amount 	was more 	than 	the 	amount 	placed 	in 	the
budget proposal 	submitted 	by 	the Governor 	in January of 	1983.
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it 	cannot 	be 	concluded 	that DPA 	failed 	to make 	concessions 	or
compromises 	with ACSA.
In Oakland Unified School District 	(11/2/81) 	PERB 	Decision
No. 	178 	the PERB 	stated:
Nothing 	in EERA 	requires 	parties 	to reach
agreement 	or make 	concessions 	on 	every
proposal. 	The NLRB 	and 	the 	courts 	have
consistently 	ruled 	that 	adamant 	insistence
on 	a 	bargaining position 	is 	not 	necessarily
a 	refusal 	to 	bargain 	in good 	faith. 	NLRB 	v.
Wooster 	Division, 	Borg-Warner 	Corporation
(1958) 	356 U.S. 	342 	[42 LRRM 20345].
In 	summary, 	the 	employer 	was 	unwilling 	to negotiate
economic matters 	until 	the Legislature 	had 	taken 	action. 	While
this posture 	shifted, deferring negotiations 	to 	that 	time when
the 	joint 	committee 	had 	completed 	its 	report 	to 	the 	time 	the
Governor 	had 	reached 	agreement with 	the Legislature, 	it 	is 	in
fact 	true, 	the DPA entered 	into negotiations 	on 	economic
matters on June 30, 	1983, 	before 	the Legislature adopted 	the
Budget Act. 	Despite 	the 	legislative 	recognition of 	possible
settlement 	of 	negotiations 	before 	the Budget Act 	is 	adopted, 	it
is 	clear 	that 	there 	is 	not 	a 	requirement 	that 	settlement shall
be 	reached 	before 	the Budget Act 	is 	adopted. 	Given 	the 	limited
context of 	negotiations 	- economic matters, 	and 	the 	factors of
education 	and welfare 	cost 	demands on 	the 	budget, 	it 	cannot 	be
held 	that 	the Governor's 	deferral of 	negotiations 	on 	state
employee 	compensation, 	a 	significant cost 	item, 	was bad 	faith
bargaining. 	Hard bargaining, 	no doubt, 	inversion of 	the
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perceived 	scheme 	no doubt, 	but not 	a violation of 	the SEERA
overall. 	Accordingly, 	the charge 	is dismissed.
PROPOSED 	ORDER
Based 	upon 	the 	foregoing 	findings 	of 	fact, 	conclusions of
law and 	the 	entire 	record 	in 	this matter, 	unfair 	practice
charge 	S-CE-184-S 	filed 	by 	the Association of Attorneys 	and
Hearing 	Officers 	against 	the 	State 	of 	California 	(Department 	of
Personnel Administration) 	and 	the 	companion PERB 	complaint 	are
hereby 	DISMISSED.
Pursuant 	to California Administrative Code, 	title 8,
part 	III, 	section 32305, 	this Proposed Decision and Order 	shall
become 	final on June 	19, 	1984, 	unless 	a party files a timely
statement of exceptions. 	In accordance with 	the 	rules, 	the
statement 	of 	exceptions 	should 	identify 	by page 	citation 	or
exhibit 	number 	the 	portions 	of 	the 	record 	relied 	upon 	for 	such
exceptions. 	See California Administrative Code, 	title 8,
part 	III, 	section 32300. 	Such 	statement of exceptions 	and
supporting 	brief must 	be 	actually 	received 	by 	the 	Public
Employment 	Relations Board 	at 	its 	headquarters 	office 	in
Sacramento 	before 	the 	close 	of business 	(5:00 	p.m.) 	on June 	19,
1984, 	or 	sent by 	telegraph or 	certified United States mail,
postmarked 	not 	later 	than 	the 	last 	day 	for 	filing 	in order 	to
be 	timely 	filed. 	See California Administrative Code, 	title 8,
part 	III, 	section 32135. 	Any 	statement 	of exceptions 	and
supporting 	brief 	must 	be 	served 	concurrently with 	its 	filing
45

upon 	each 	party 	to 	this proceeding. 	Proof of 	service 	shall be
filed 	with 	the Board 	itself. 	See 	California Administrative
Code, 	title 8, 	part III, 	section 32300 and 32305.
Dated: 	May 30, 	1984
Gary 	M. 	Gallery
Admini 	Law Judge
46
1'..aw yitdge