EMPLOYER REFUSAL TO BARGAIN IN GOOD FAITH; DEFENSES – Business Necessity; Emergency Exception

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The MMBA does not define what circumstances constitute an “emergency.” In Sonoma County Organization etc. Employees v. County of Sonoma (1992) 1 Cal.App.4th 267, the Court of Appeal found that the term “has long been accepted in California as an unforeseen situation calling for immediate action.” (Id. at p. 276.) “[A]n emergency must have a substantial likelihood that serious harm will be experienced” and “is not synonymous with expediency, convenience, or best interests.” (Id. at p. 277, internal citations omitted.) While the statutory emergency defense is unique to the MMBA, the Board has recognized an affirmative defense available under all PERB-administered statutes that serves the same function. This “business necessity” defense requires the employer to prove: (1) an actual financial or other emergency that (2) leaves no real alternative to the action taken and (3) allows no time for meaningful negotiations before taking action. In past decisions, the Board has treated the two defenses as interchangeable by requiring the same elements to establish either affirmative defense. Here, there was certainly an emergency. The COVID-19 pandemic was nascent in the United States and rapidly developing. The District’s provision of electricity and water to residents of Imperial Valley was at risk of disruption. While the pandemic permitted the District to sequester employees before it completed negotiations, however, the District failed to demonstrate that the emergency left it with no real alternative to altering the compensation framework before completing negotiations. In addition, although the circumstances here allowed very limited time before taking action to sequester employees, they imposed no rapid deadline on bargaining over compensation. The District therefore did not establish that it was excused from bargaining compensation under section 3504.5, subdivision (b), because it did not prove the second and third prongs of the defense. Moreover, even had it done so, the defense still requires an employer to meet and confer at the earliest practicable opportunity following implementation (§ 3504.5, subd. (b)), yet the District abandoned negotiations altogether contemporaneously with its implementation. (pp. 55-56, 61-62.)