Decision 2464M – City of San Diego * * * Affirmed, 5 Cal.5th 898 (2018). Remedy modified by City of San Diego (2019) PERB Decision No. 2464a-M * * *

Whether a mayor or other city officials and employees complied with other laws, regulations or policies does not determine the lawfulness of the City’s conduct under the MMBA. The constitutional right of a local electorate to legislate by initiative, like the home rule authority of a charter city, extends only to municipal affairs and, as such, it is preempted by general laws affecting matters of statewide concern such as the MMBA. In the absence of controlling appellate authority directing PERE that the meet-and-confer process is constitutionally infirm or preempted by the local initiative process, PERB will follow the MMBA and its case law requiring public employers to meet and confer with employee representatives before deciding to alter negotiable matters.

Whether a mayor or other city officials and employees complied with other laws, regulations or policies does not determine the lawfulness of the City’s conduct under the MMBA. The constitutional right of a local electorate to legislate by initiative, like the home rule authority of a charter city, extends only to municipal affairs and, as such, it is preempted by general laws affecting matters of statewide concern such as the MMBA. In the absence of controlling appellate authority directing PERE that the meet-and-confer process is constitutionally infirm or preempted by the local initiative process, PERB will follow the MMBA and its case law requiring public employers to meet and confer with employee representatives before deciding to alter negotiable matters.

Under PERB’s Inglewood test, the party asserting an agency relationship by way of apparent authority has the burden of proving that theory by competent and admissible but not necessarily direct evidence. Because the test is an objective one whose inquiry is what employees would reasonably believe under the circumstances, what any particular employee subjectively believed is not determinative. An employer’s high-ranking officials, particularly those whose duties include employee or labor relations or collective bargaining matters, are generally presumed to speak and act on behalf of the employer, such that their words and conduct may be used to impute liability in unfair practice cases against the employer. A public employer may be held responsible for the actions of its highest ranking representatives or officials, even when they are engaged in ostensibly “private” conduct that contravenes the employer’s official policy. Where the City Council knew of the Mayor’s efforts to alter employee pension benefits through a ballot measure, of his use of the vestments and prestige of his office to promote this policy change, and, of his rejection of repeated requests from the Unions to meet and confer regarding this change, PERB found that City Council’s failure to repudiate Mayor’s conduct, including his outright refusal to meet and confer over the decision, City Council ratified Mayor’s conduct.

Under PERB’s Inglewood test, the party asserting an agency relationship by way of apparent authority has the burden of proving that theory by competent and admissible but not necessarily direct evidence. Because the test is an objective one whose inquiry is what employees would reasonably believe under the circumstances, what any particular employee subjectively believed is not determinative. An employer’s high-ranking officials, particularly those whose duties include employee or labor relations or collective bargaining matters, are generally presumed to speak and act on behalf of the employer, such that their words and conduct may be used to impute liability in unfair practice cases against the employer. A public employer may be held responsible for the actions of its highest ranking representatives or officials, even when they are engaged in ostensibly “private” conduct that contravenes the employer’s official policy. Where the City Council knew of the Mayor’s efforts to alter employee pension benefits through a ballot measure, of his use of the vestments and prestige of his office to promote this policy change, and, of his rejection of repeated requests from the Unions to meet and confer regarding this change, PERB found that City Council’s failure to repudiate Mayor’s conduct, including his outright refusal to meet and confer over the decision, City Council ratified Mayor’s conduct.

Board affirmed ALJ’s finding that the Mayor acted as the statutory agent of the City in announcing and supporting ballot measure to change City policy regarding employee pension benefits where evidence demonstrated that City officials and their staff made no serious effort to segregate the official duties of the Mayor and his staff from their ostensibly private activities in support of the pension reform initiative.

A unilateral change occurs when an employer an employer makes a firm decision to change policy affecting an negotiable subject without providing the employees’ representative with notice or opportunity for bargaining. The date of the decision triggers liability, even if the change itself is not scheduled to take effect until a later date or never takes effect. Mayor’s announcement in State of the City speech and various official press conferences of plans to alter employee pension benefits through a citizens’ initiative constituted firm decision to alter policy on a negotiable subject.

A unilateral change occurs when an employer an employer makes a firm decision to change policy affecting an negotiable subject without providing the employees’ representative with notice or opportunity for bargaining. The date of the decision triggers liability, even if the change itself is not scheduled to take effect until a later date or never takes effect. Mayor’s announcement in State of the City speech and various official press conferences of plans to alter employee pension benefits through a citizens’ initiative constituted firm decision to alter policy on a negotiable subject.

PERB rejected defense that Mayor and other City officials were acting as private citizens when they and their staff appeared at press conferences and other public events, used City staff, e-mail accounts, websites and other City resources, as well as the prestige of their City offices to publicize and solicit support for a ballot initiative aimed at altering the pension benefits of City employees. Board affirmed ALJ’s finding that the Mayor acted as the statutory agent of the City in announcing and supporting ballot measure to change City policy regarding employee pension benefits and in refusing to bargain with the Unions over this change in policy.

The MMBA’s scope of representation is not preempted by the local initiative process. An employer’s duty to meet and confer requires that it give notice and opportunity for meeting before it submits to voters measures affecting employee pension benefits or other negotiable subjects.

The MMBA’s scope of representation is not preempted by the local initiative process. An employer’s duty to meet and confer requires that it give notice and opportunity for meeting before it submits to voters measures affecting employee pension benefits or other negotiable subjects.

The MMBA’s scope of representation is not preempted by the local initiative process. An employer’s duty to meet and confer requires that it give notice and opportunity to meet and confer before it places before voters measures affecting employee pension benefits or other negotiable subjects.

Proposed decision’s misidentification of group associated with City’s mayor was non-prejudicial error where substantial other evidence in the record demonstrated that the Mayor, his staff, and other City officials had used City resources and the prestige of their offices to promote a ballot measure to alter employee pension benefits.

Although PERB’s traditional remedy for an employer's unlawful unilateral change includes restoration of the prior status quo and appropriate make whole relief, including back pay and benefits with interest thereon, for all employees who have suffered loss as a result of the unlawful conduct, the Board does not have jurisdiction to rescind a municipal election to overturn a ballot measure. Where City’s unilateral change to employee pension benefits was enacted through citizen’s initiative, PERB lacked jurisdiction to order the election results rescinded but ordered the City to pay affected employees the difference for the resulting change in pension benefits, plus interest at seven percent per annum. Restoring injured parties and affected employees to their respective positions before an unfair practice occurred is critical to an effective Board-ordered remedy because it prevents the employer from gaining a one-sided and unfair advantage in negotiations and thereby forcing the employees’ representative to talk the employer back to terms previously agreed to. Where the Board lacks jurisdiction to order an unfair practice reversed, it may award compensatory damages, including attorneys’ fees and costs for separate litigation that is necessary to obtain complete relief from the unfair practice.

Although PERB’s traditional remedy for an employer’s unlawful unilateral change includes restoration of the prior status quo and appropriate make whole relief, including back pay and benefits with interest thereon, for all employees who have suffered loss as a result of the unlawful conduct, the Board does not have jurisdiction to rescind a municipal election to overturn a ballot measure. Where City’s unilateral change to employee pension benefits was enacted through citizen’s initiative, PERB lacked jurisdiction to order the election results rescinded but ordered the City to pay affected employees the difference for the resulting change in pension benefits, plus interest at seven percent per annum.

Although PERB’s traditional remedy for an employer’s unlawful unilateral change includes restoration of the prior status quo and appropriate make whole relief, including back pay and benefits with interest thereon, for all employees who have suffered loss as a result of the unlawful conduct, the Board does not have jurisdiction to rescind a municipal election to overturn a ballot measure. Where City’s unilateral change to employee pension benefits was enacted through citizen’s initiative, PERB lacked jurisdiction to order the election results rescinded but ordered the City to pay affected employees the difference for the resulting change in pension benefits, plus interest at seven percent per annum. Restoring injured parties and affected employees to their respective positions before an unfair practice occurred is critical to an effective Board-ordered remedy because it prevents the employer from gaining a one-sided and unfair advantage in negotiations and thereby forcing the employees’ representative to talk the employer back to terms previously agreed to. Where the Board lacks jurisdiction to order an unfair practice reversed, it may award compensatory damages, including attorneys’ fees and costs for separate litigation that is necessary to obtain complete relief from the unfair practice.

Although PERB’s traditional remedy for an employer’s unlawful unilateral change includes restoration of the prior status quo and appropriate make whole relief, including back pay and benefits with interest thereon, for all employees who have suffered loss as a result of the unlawful conduct, the Board does not have jurisdiction to rescind a municipal election to overturn a ballot measure. Where City’s unilateral change to employee pension benefits was enacted through citizen’s initiative, PERB lacked jurisdiction to order the election results rescinded but ordered the City to pay affected employees the difference for the resulting change in pension benefits, plus interest at seven percent per annum. Restoring injured parties and affected employees to their respective positions before an unfair practice occurred is critical to an effective Board-ordered remedy because it prevents the employer from gaining a one-sided and unfair advantage in negotiations and thereby forcing the employees’ representative to talk the employer back to terms previously agreed to. Where the Board lacks jurisdiction to order an unfair practice reversed, it may award compensatory damages, including attorneys’ fees and costs for separate litigation that is necessary to obtain complete relief from the unfair practice.

Although PERB’s traditional remedy for an employer’s unlawful unilateral change includes restoration of the prior status quo and appropriate make whole relief, including back pay and benefits with interest thereon, for all employees who have suffered loss as a result of the unlawful conduct, the Board does not have jurisdiction to rescind a municipal election to overturn a ballot measure. Where City’s unilateral change to employee pension benefits was enacted through citizen’s initiative, PERB lacked jurisdiction to order the election results rescinded but ordered the City to pay affected employees the difference for the resulting change in pension benefits, plus interest at seven percent per annum.

Although PERB’s traditional remedy for an employer’s unlawful unilateral change includes restoration of the prior status quo and appropriate make whole relief, including back pay and benefits with interest thereon, for all employees who have suffered loss as a result of the unlawful conduct, the Board does not have jurisdiction to rescind a municipal election to overturn a ballot measure. However, the Board may award attorneys’ fees and other litigation costs to an injured party who must pursue litigation in the courts or before another tribunal to obtain complete relief for an unfair practice. In addition to cease-and-desist order, PERB ordered the City to join in litigation and/or pay attorneys’ fees and court costs to unions as remedy for City’s unilateral change to employee pension benefits enacted through a citizens’ initiative.

Although PERB’s traditional remedy for an employer’s unlawful unilateral change includes restoration of the prior status quo and appropriate make whole relief, including back pay and benefits with interest thereon, for all employees who have suffered loss as a result of the unlawful conduct, the Board does not have jurisdiction to rescind a municipal election to overturn a ballot measure. However, the Board may award attorneys’ fees and other litigation costs to an injured party who must pursue litigation in the courts or before another tribunal to obtain complete relief for an unfair practice. In addition to cease-and-desist order, PERB ordered the City to join in litigation and/or pay attorneys’ fees and court costs to unions as remedy for City’s unilateral change to employee pension benefits enacted through a citizens’ initiative.

An employer’s high-ranking officials, particularly those whose duties include employee or labor relations or collective bargaining matters, are generally presumed to speak and act on behalf of the employer, such that their words and conduct may be used to impute liability in unfair practice cases against the employer.

Although PERB generally follows common law principles of agency, it, like the NLRB and ALRB, routinely applies these principles with reference to the broad, remedial purposes of the statutes it administers rather that by strict application of concepts governing an employer’s responsibility to third parties for the acts of its employees. Given the extent to which the Mayor, his staff, and other City officials used City resources and the prestige of their offices to promote a ballot measure to alter employee pension benefits, making liability dependent on whether the City Council had expressly authorized its statutory agent in collective bargaining matters to pursue the ballot measure would allow the City to use its local initiative power to undermine the principle of bilateral negotiations required by the MMBA. PERB rejected defense that Mayor and other City officials were acting as private citizens when they and their staff appeared at press conferences and other public events, used City staff, e-mail accounts, websites and other City resources, as well as the prestige of their City offices to publicize and solicit support for a ballot initiative aimed at altering the pension benefits of City employees. Board affirmed ALJ’s finding that the Mayor acted as the statutory agent of the City in announcing and supporting ballot measure to change City policy regarding employee pension benefits and in refusing to bargain with the Unions over this change in policy. Board’s finding that Mayor was acting with actual authority on behalf of the City did not turn on whether the City had authorized the specific acts undertaken by the Mayor as its bargaining representative, but whether the Mayor was acting within the scope of his authority, including the degree of discretion conferred on him by the City Charter to further the City’s interests. Under PERB’s Inglewood test, the party asserting an agency relationship by way of apparent authority has the burden of proving that theory by competent and admissible but not necessarily direct evidence. Because the test is an objective one whose inquiry is what employees would reasonably believe under the circumstances, what any particular employee subjectively believed is not determinative.