An
Overview of
by Marshall L. Gratz
Staff Attorney/Team Leader,
Originally Presented to the Founding Conference of the
Metro
Park East Hotel,
(last updated August 8, 2006)
I. Development of
A.-Private Sector -
1. WEPA precursors since mid-30's, WEPA '39
2. (
B.-Municipal Sector -
1. MERA precursors since '59, MERA '71, med-arb '78,
2. '86 amendments, '93 amendments, '95 amendments (removed interest arb sunset; made teacher QEO permanent; changed general employe interest arb criteria; authorized expanded case filing fees to fund five existing WERC professional staff positions), '97 amendments; '99 amendments (changed economic items definition and altered QEO calculation components).
3. (Municipal Employment Relations Act, Sec. 111.70 et seq.)
C. -State Sector -
1. SELRA precursors since '65, SELRA '71, coverage expanded over time to include UW program, project and teaching assistants, assistant district attorneys, and UW Hospitals and Clinics Board employes.
2. (State Employment Labor Relations Act, Sec. 111.80 et seq.)
D. -distinctive common elements -
1. contract enforcement jurisdiction
2. grievance arbitration
3. single multi-function and multi-sector agency
E.-effects of federal law on scope of state jurisdiction
1.-limits on WEPA due to NLRA preemption
2.-constitutional limits (if any) on federal public sector preemption
F.-context in which public sector statutes developed/exist
1. -constitutions
2. -due process; equal protection; separation of powers
3. -freedom of association vs public sector union security
4. -general powers statutes -- split public employer authority
5. -taxpayer and other interest group politics replaces private profit concerns
6. -civil service statutes -- procedures, rules, substantive protections
7. -special wage, benefit and working condition statutes
G.-uneasy overlay of legislated bilateral labor-management relationship
1.-primarily-related test for MERA mandatory subjects
2 -not-contrary-to-command-of-law test for MERA illegal subjects
H. -patchwork and change as characteristics of public sector laws
II. Key Elements of
A. -statement of purpose -
1. interests of employes, employers, and public considered; encourage voluntary settlement through collective bargaining if employes chose to be represented; if bargaining fails, provide fair, speedy, effective and above all peaceful procedure for settlement.
2. -jurisdictional parameters -- relationships to which law applies
3. -employee rights to engage or not in collective bargaining and other lawful concerted activities free of interference and discrimination
4. -private sector right to strike; public sector strikes prohibited except in very limited circumstances; penalties for strikes in violation of injunctions
5.-definitions of who is protected and who is regulated -- exclusions of supervisors, managerial employes and confidential employes
6.-"rules of the game" -- prohibiting certain practices; scope and nature of bargaining obligation -- mandatory, permissive, prohibited/illegal subjects
7. -complaint procedures for preventing/remedying unfair and prohibited practices
8. -declaratory ruling procedures for resolving scope of bargaining disputes
9. -bargaining unit definitions -- craft, professionals, anti-fragmentation, community of interests
10.-methods for selection of bargaining representative -- exclusivity and its limits; duty of fair representation
12. -authorization of union security agreements -- fair share, all-Union agreement
13. -methods for resolving bargaining impasses -- mediation, interest arb, fact-finding
III. Resultant Roles of
A. -rule making
B. -adjudication
1. -unfair labor practice/prohibited practice complaints (see complaint booklet)
2. -representation and referendum petitions
3. -scope of bargaining and other declaratory ruling petitions
4. -fee setting for certain WERC services
5. -mediation of interest and grievance disputes
6. -gatekeeper of impasse resolution processes
7. -interest arbitrator/fact finder appointment -- ad hoc lists
8. -also recruitment and training of interest arbitrators
9. -grievance arbitration -- staff, ad hoc lists
10. -conduct of representation elections and union security referendums
11. -encouragement and support of labor management cooperation activities
12. -public information services for groups, classes and training programs
13. -information gathering, reporting and publishing
IV. Basic Nature of
A. -not DER, not ERD or LIRC of DILHR, not DOL, and not WEAC.
B. -independent agency, 3 commissioners, 6-year terms, 1 chairperson
C. -professional staff -- general counsel, team leaders, in
D. -support staff -- elections supervisor, publications sales
E. -headquarters office in
F. -hearings/mediations normally conducted near parties' locations
V. Overview of Municipal Sector Interest Arbitration Processes for resolving contract negotiation impasses
OVERVIEW OF THE INTEREST ARBITRATION PROCESS UNDER SEC. 111.70(4)(cm), STATS. AND WERC RULES CH. ERC 32
Non-supervisory police-fire contract negotiation impasses in jurisdictions of 2500 or more are subject to final offer package arbitration as provided in Sec. 111.77, Stats and WERC Rules Ch. ERC 30, which is similar to the process outlined below . However, both supervisory and non-supervisory City of Milwaukee police contract negotiation impasses are subject to a different arbitration process in Sec. 111.70(4)(jm) under which the arbitrator decides each disputed issue without being limited to selection of a party's final offer.
The Sec. 111.70(4)(cm) interest arbitration process outlined below, which was formerly called mediation-arbitration, applies to non-supervisory bargaining units of municipal employes other than law enforcement personnel and fire fighters. The interest arbitration process applies only to contract negotiation disputes regarding the terms of a new or successor agreement. Except for negotiation disputes arising under a formal agreement to reopen a subject during the term of an existing agreement, the statutory interest arbitration process is not applicable to negotiation disputes that arise during the term of an existing collective bargaining agreement.
Section 111.70(4)(cm) as revised by 1995 Wisconsin Act 27 provides for a contract negotiation dispute resolution process that can be summarized as follows:
Except where the parties have mutually agreed upon a different procedure, and until an unconditional settlement is reached, the statute provides the following steps shall be followed:
1. notice to other party and WERC of intent to commence negotiations of new or successor agreement or terms of reopener in existing agreement
2. bilateral negotiations (first meeting in public)
3. mediation by WERC member or staff member on request of either party or WERC
4. investigation by WERC member or staff member upon petition or stipulation
a. "preliminary final offers" submitted with petition and within 14 days after petition is received by other party
b. mediation or further mediation as appropriate
c. determination whether conditions precedent to initiation of interest arbitration have been met
[Note: there are major differences for teachers' units from this point on in the process if the school district offers a Qualified Economic Offer, see separate Teacher Unit Differences sheet]
d. obtain written position regarding willingness to have nonresident arbitrators on list to be supplied by WERC
e. execution of stipulation of unconditionally agreed upon items
f. exchange of final offers -- final offers must specify a contract term of 2 years with no reopener provisions other than savings clauses, unless the parties have agreed to a different term of agreement in their stipulation of agreed items
g. deadline set for raising objections based on alleged non-mandatory status of subjects in other side's offer and for filing petition for WERC declaratory ruling to resolve any such objection
h. further investigation following declaratory ruling issuance, if any
i. close of investigation by WERC investigator (when parties decline to further modify position with knowledge of other side's contemplated final offer; close of investigation precludes subsequent unilateral modification of offers; investigator may deem a party's latest written offer to be its final offer if the party fails to submit a final offer by the deadline set by the investigator).
5. WERC issues order initiating interest arbitration and supplies list of seven individuals from its ad hoc arbitrator list (individuals not employed by WERC and deemed by WERC to be qualified by their education and experience to serve as interest-arbitrators; only Wisconsin residents unless parties have agreed otherwise during investigation). Final offers become public documents upon the issuance of WERC order initiating med-arb, and the offers are available to the public from WERC upon request.
6. parties advise WERC of interest arbitrator selected and WERC issues order appointing the outside interest arbitrator and directs employer to post notice to public of right to petition for a public hearing before the interest arbitrator.
7. interest arbitrator conducts public meeting, if one is timely requested by 5 citizens of the jurisdiction involved. Parties state their basic positions in support of their respective final offers and then members of the public are given an opportunity to express their opinions in the matter.
8. interest arbitrator gives notice of arbitration hearing date and sets deadline for parties to mutually withdraw their final offers if they intend to do so.
a. timely withdrawal of final offers by both sides suspends arbitration activity and permits the union to lawfully strike on 10 days written notice.
b. such a strike is subject to being terminated in favor of immediate resumption of arbitration if circuit court determines that the strike is harmful to the public health or safety
9. arbitration by interest arbitrator:
a. arbitrator may attempt to mediate, but so long as both parties are willing to mediate the dispute further. Parties may change their final offer only with consent of other side. Binding consent award may be issued resolving the dispute if the parties mutually agree to that procedure.
b. arbitration involves a hearing (open to the public) at which parties present evidence and arguments as to why their respective offer is more reasonable under the Sec. 111.70(4)(cm)7 criteria:
(1) greatest weight to state law limits on employer spending or revenue
(2) greater weight to local economic conditions
(3) weight to the following other factors:
-employer's lawful authority
-parties' stipulations
-interests and welfare of public and employer's ability to pay
-"comparables" i.e., wages, hours and conditions of employment comparisons with other employes performing similar services, with other public and private sector employes in the same or comparable communities
-cost of living
-overall compensation
-changes in the foregoing during pendency of the arbitration
-other factors normally or traditionally considered by interest arbitrators
c. after receiving written post-hearing arguments, if any, from the parties, arbitrator issues final offer package award selecting one or the other of the final offers in its entirety.
d. parties are obligated to pay half of the interest arbitrator's fees and expenses.
10. interest arbitration awards are thereafter subject to enforcement under
WERC prohibited practice process and, in turn, to limited judicial review.
11. copies of awards and arbitrators' fee statements are available at nominal cost from WERC.
- - - - -
A NOTE ABOUT THE POLICY OBJECTIVES OF
FINAL OFFER PACKAGE ARBITRATION PROCESS:
Wisconsin's interest arbitration process appears to have been designed to meet constitutional requirements that there be standards for arbitrators' decisions, appointment of arbitrators by a state agency, and availability of at least a limited judicial review of awards; to provide a peaceful means of dispute resolution with interest arbitration substituted for the strike in almost all cases; and to encourage voluntary settlement of disputes through bargaining, mediation, investigation, and arbitration processes.
The default system of final offer package arbitration is designed to pressure the parties to narrow or resolve their dispute on their own or through state agency mediation rather than risk a substantial set-back in arbitration. The extent to which arbitrators are prevented from achieving optimally equitable awards by the either-or limitation is considered outweighed by the increased deterrence of arbitration use and the high policy value placed on voluntary settlement of disputes.
Some of the Differences in Teacher Unit Bargaining
Under 1993 Act 16 as modified by 1995 Act 27, 1997 Act 237, and 1999 Act 9*
(assume
old agreement expires on 6-30-05)
1. agreement must terminate 6-30-2007
2. parties may change salary schedule structure by mutual
agreement
3. district must give union available information about
possible qualified economic offer (QEO) on Forms A, B and C at least 60 days
before expiration (or ASAP after rules were issued) or when QEO is proposed,
whichever is earlier.
4. no arbitration of economic issues if district's offer
amounts to a QEO -- exception:
impact of subcontracting of teacher unit work is subject to interest
arbitration notwithstanding that the district has offered a QEO.
5. no arbitration of non-economic issues (and hence no overall
contract settlement) unless and until parties sign a stipulation resolving all
economic issues. See last clause of 6, below.
6. in general, good faith bargaining duty and the status quo
rule apply to mandatory subjects including wages and fringes both before and
after deadlock is declared. Exceptions: district is permitted to implement QEO
wages and fringes after WERC investigator's determination of deadlock and is
authorized to recoup overpayments after QEO or contract is implemented; district's
obligation to meet/bargain further after deadlock declaration may depend on
whether material change occurs in union position or in other circumstances
surrounding the negotiations; if no agreement has been reached by April 1, 2007,
(90 days before expiration of term being negotiated) the parties are deemed by
operation of law to agree to economics consisting of status quo modified by
implemented QEO and any agreed upon changes in economics.
7. if district has
offered a QEO, all (and only) predecessor agreement economic issue provisions
must continue to be honored during contract hiatus except to the extent
modified by a lawfully implemented QEO and except as the parties may otherwise
agree.
8. economic issues
are broadly defined as "salaries, overtime pay, sick leave, payments in
lieu of sick leave usage, vacations, clothing allowances in excess of the
actual cost of clothing, length-of-service credit, continuing education credit,
shift premium pay, longevity pay, extra duty pay, performance bonuses, health
insurance, life insurance, dental insurance, disability insurance, vision
insurance, long-term care insurance, worker's compensation and unemployment
insurance, social security benefits, vacation pay, holiday pay, lead worker
pay, temporary assignment pay, retirement contributions, supplemental
retirement benefits, severance or other separation pay, hazardous duty pay,
certification or license payment, limitations on layoffs that create a new or
increased financial liability on the employer and contracting or subcontracting
of work that would otherwise be performed by municipal employees in the
collective bargaining unit with which there is a labor dispute."
9. unless the parties mutually agree otherwise, a QEO is
tightly defined as offering to:
a. maintain
fringe benefits in effect 90 days before bargaining commenced
b. maintain
district percentage fringe contributions then in effect
c. (for contract periods beginning
on or after July 1, 2001) provide salaries for each 12 month period (and a
prorated offer for any remaining period in the contract term consisting of less
than 12 months) that would, for staff in unit as of snapshot date (90 days
prior to expiration), theoretically cost 3.8% of preceding year's total package
cost less the cost of fringe benefit maintenance, no more and no less than 3.8%.
[Note: QEO costing
is based on assumption that there is no year to year change in the snapshot
date staff and no change in their level of service/activity (e.g., numbers of
miles driven and reimbursed, numbers of summer school courses taught, etc.). The cost of educational
advancement incentives are not considered in QEO calculations.]
d. if cost
of fringe benefit maintenance is less than 3.8% of preceding year's total
package cost, then allocate available salary monies in the following order:
(1) full or pro-rated portion of step for all those eligible. (As part of a QEO, employees should always be placed on the salary step that corresponds to their years of service even if QEO monies are not sufficient to pay them the salary amount provided at that step. As part of a QEO, employees who have not received a full step of pay in prior QEO years are to be caught up so that their pay matches their step placement before any money can be used to increase the overall salary schedule.)
(2)
all other salary increase monies must be paid in
across the board manner that best retains existing rate relationships within
the schedule (equal $ per cell, equal % per cell, or change base and apply
existing index).
e. if cost
of fringe benefit maintenance exceeds 3.8% of preceding year's total package
cost, then reduce salary in across the board manner that best retains existing
rate relationships within the schedule.
*These notes are
not an official interpretation of the controlling statutes and rules.
MG rev. 08-08-06
MEDIATION AND MEDIATION-INVESTIGATION OF LABOR MANAGEMENT DISPUTES IN
THE
I. DESCRIPTION OF MEDIATION IN PRIVATE AND STATE SECTOR AND SOME MUNICIPAL CASES:
-ordinarily provided as a governmental service; sometimes private ad hoc neutrals
-ordinarily free of charge; ad hocs charge, of course
-generally consensual, that is:
----initiated only upon agreement of the parties
----mediator has no authority to require either side to agree or even to meet; depends upon ability to persuade parties in those regards
-primarily as regards contract negotiation (interest) disputes
-grievance mediation is also available, though not widely utilized
II. DIFFERENCES IN MEDIATION PROCESS WHERE DISPUTE IS SUBJECT TO FINAL OFFER INTEREST ARBITRATION
Unlike private sector setting mediation becomes
-NOT WHOLLY CONSENSUAL (can be invoked by either party or the Commission)
-NOT WHOLLY PRIVATE (results of unsuccessful mediation are a matter of public record)
-PARTIES DO NOT HAVE THE LAWFUL RIGHT TO SAY "NO" (no right to strike or lockout, and lawful strike is subject to court imposed arbitration if found to harm public health or safety)
-NOT PROCEDURALLY STRAIGHT FORWARD (call the mediator or not as parties choose). Rather A COMPLEX COMPLUSORY PROCEDURE IMPOSED BY LAW CULMINATING POTENTIALLY IN A FINAL AND BINDING OUTSIDE ARBITRATOR'S DECISION. Process designed to encourage the parties to maximize voluntary settlements and minimize extent of resort to 3rd party decisions by:
-MANDATORY MEDIATION both by WERC and again later by outside arbitrator
-MUST REDUCE FINAL OFFERS ON MANDATORY SUBJECTS TO WRITING
-FINAL OFFERS NOT UNILATERALLY AMENDABLE AFTER CLOSE OF WERC INVESTIGATION
-MUST PARTICIPATE IN PROCEEDINGS BEFORE OUTSIDE ARBITRATOR attendant costs and delays if no voluntary agreement
-RISK OF ARBITRATING HEIGHTENED BY LIMITING ARBITRATOR TO SELECTION OF ONE PACKAGE OR THE OTHER without compromise (unless the parties agree on some other form of arbitration), and hence increasing the potential consequences of nonsettlement.
-UNCERTAINTY OF OUTCOME HEIGHTENED by BROAD STATUTORY CRITERIA with NO MANDATED WEIGHTING and subject to limited administrative and judicial review. Decisions have generally emphasized internal and external comparabiles and have placed burden on the party seeking to change a historical arrangement or relationship
-PROCESS PROTECTED FROM MOST DELAYS BUT EXPRESSLY SUBJECT TO DELAY FOR PROCESSING OF DISPUTE AS TO MANDATORY/NONMANDATORY NATURE OF PROPOSAL. Objections can be timely raised at any time prior to close of investigation.
III. MEDIATION TECHNIQUES USED IN ADVANCE OF POTENTIAL FINAL OFFER INTEREST ARBITRATION
Make certain that the parties understand the process and the realistic alternatives available to them in it at any given time, and make informed choices including:
-general costs and delays inherent in arbitrating; more issues outstanding, the greater the potential cost and delays in preparing, presenting and having the case decided
-possibility that investigation will close with party in disadvantageous position, potentially foreclosing further modification of final offer--can't rely on mediation by mediator-arbitrator
-reduce risk of arbitration loss by avoiding long list, unusual cost, sore thumbs, unjustifiable resistance to other's proposals, unjustified proposals for changes in status quo or deviation from historical relationships or arrangements
-create settlement incentives for the other side by offering
-----"stick"--make your offer reasonable but have it hurt other side on item(s) they're vulnerable on, i.e., a "zinger" if you can find one
-----"carrot"--offer better terms if settle without arb'--solve problems for other side they couldn't hope to fix through arb'n
-----early revelation of both may move things along
-draft and work around uncertainties of litigation re ULP, objected-to subject of bargaining, unsettled areas of law
-at least narrow issues if you can't settle all of them--saves money and time with the outside arbitrator and perhaps reduces risk of loss;
-possible that full or partial settlement can provide some outcomes that arbitrating cannot: nonmandatory subjects, complex issues requiring mutual efforts to achieve a workable solution, issues that would be sore-thumbs or at least detract from reasonableness of a package
--end of mediation outline--
-#-
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