E _ iLI- D
COURT OF APPEALS
D111 113100 II
2013 DEC { 7 AM D: 50
IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
DIVISION II
SNOHOMISH COUNTY PUBLIC No. 43783 -0 -II
TRANSPORTATION BENEFIT AREA d /b /a
COMMUNITY TRANSIT,
Appellant,
V.
STATE OF WASHINGTON PUBLIC UNPUBLISHED OPINION
EMPLOYMENT RELATIONS
COMMISSION and AMALGAMATED
TRANSIT UNION, LOCAL 1576,
QUINN- BRINTNALL, J. — Snohomish County Public Transportation Benefit Area d /b /a
Community Transit appeals from the superior court' s order affirming an administrative order
issued by the Public Employment Relations Commission ( "PERC "). In the administrative order,
PERC ruled that Community Transit committed an unfair labor practice when it insisted to
bargaining to impasse a permissive subject of collective bargaining. Community Transit argues
that PERC' s order is invalid for three reasons: ( 1) PERC misinterpreted, or misapplied the law,
2) PERC exceeded its statutory authority, and ( 3) PERC' s order was arbitrary and capricious.
Based on PERC' s earlier, unchallenged conclusion that the provision at issue was a waiver
clause, PERC properly concluded that the provision was a permissive subject of bargaining and
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Community Transit committed an unfair labor practice by insisting to impasse on a permissive
subject of bargaining. Accordingly, we affirm.
FACTS AND LEGAL BACKGROUND
Amalgamated Transit Union, Local 1576 ( Amalgamated), represents bus drivers and
other transit workers employed by Community Transit.' From 1979 to 2007, Community Transit
and Amalgamated executed a series of collective bargaining agreements. Among their
provisions, the parties' collective bargaining agreements have included ( 1) a management rights
2(
clause , 2) procedures for grievances filed either by the union or by an individual employee, and
3) a provision known as " Section 18. 2." Section 18. 2 applies when, during the life of the
collective bargaining agreement, Community Transit changes the employee rules, including
standard operating procedures and the performance code.
In 1997, Amalgamated brought an unfair labor practices complaint against Community
Transit alleging that Community Transit unilaterally made changes to mandatory subjects of
bargaining. 3 Amalgamated Transit Union, Local 1576 v. Cmty. Transit, No. 13219 -U -97 -3216,
1998 WL 1978452, at * I ( Wash. Pub. Emp' t Relations Comm' n July 23, 1998). In a 1998 order
dismissing the complaint, PERC ruled that under Section 18. 2, Amalgamated waived its right to
bargain Community Transit' s changes to the employee rules during the life of the contract.
The includes the following job classifications: coach operators, dispatchers,
bargaining unit
instructors, customer information specialists, sales and distribution specialists, facility
maintenance leads, workers, journey workers, and internal security officers.
2
A management rights clause is generally a clause that allows management to maintain control
over decisions with respect to the operation and management of the organization. See Pasco
Police Officers' Ass' n v. City ofPasco, 132 Wn.2d 450, 455 -56, 938 P.2d 827 ( 1997).
3 In the predecessor agreement considered by PERC in 1998, the Section 18. 2 language was
found in Section 19. 2. Otherwise, the language is exactly the same.
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Amalgamated, 1998 WL 1978452, at * 6. Therefore, the 1998 PERC decision defined Section
18. 2 as a waiver clause. Neither party appealed PERC' s 1998 decision interpreting the identical
language at issue here.
Years later, Community Transit and Amalgamated attempted to negotiate a successor to
the collective bargaining agreement that expired December 31, 2007. During negotiations,
Amalgamated sought to revise Section 18. 2. For its part, Community Transit sought to retain the
Section 18. 2 language without amendments. A mediator ultimately found the parties reached an
impasse on Section 18. 2 and certified the issue to interest arbitration.
Amalgamated filed an unfair labor practice complaint, alleging that Section 18. 2 is a
permissive subject of bargaining and that Community Transit committed an unfair labor practice
because it insisted to impasse on a permissive subject of bargaining. After convening a hearing
on the complaint, a hearing examiner entered findings of fact and conclusions of law relying on
the earlier interpretation of Section 18. 2 and, thus, determining that Section 18. 2 was a
permissive subject of bargaining. Accordingly, the hearing examiner decided that Community
Transit committed an unfair labor practice by insisting to impasse on a permissive subject of
bargaining.
Transit the hearing examiner' s decision to PERC. PERC affirmed,
Community appealed
hearing findings of fact and conclusions of law. In affirming and
adopting the examiner' s
adopting the hearing examiner' s order, PERC explained that Community Transit was bound by
the previous interpretation of Section 18. 2 as a waiver provision and that it could not now argue
it was a managerial rights provision. Therefore, an earlier decision, Whatcom County Deputy
Sheriff's Guild v. Whatcom County, No. 15383 -U -00 -3889, 2004 WL 725698 ( Wash. Pub. Emp' t
Relations Comm' n Feb. 11, 2004), controlled the outcome rather than the balancing test in
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No. 43783 -0 -II
International 4ss' n of Fire Fighters, Local Union 1052 v. Public Employment Relations
Commission, 113 Wn.2d 197, 203, 778 P. 2d 32 ( 1989), which is used to determine whether a
hybrid provision is primarily concerned with mandatory or permissive subjects of bargaining.
Because waiver provisions are permissive subjects of bargaining under Whatcom County, PERC
concluded that the hearing examiner properly decided that Community Transit committed an
unfair labor practice by insisting to impasse on a permissive subject of bargaining.
4
Transit then for judicial review of PERC' s order. The superior
Community petitioned
court denied Community Transit' s petition and affirmed PERC' s order. Community Transit now
5
appeals to this court.
RNOVEIVAIA30k,
Community Transit argues that PERC' s order is invalid. First, Community Transit
argues that PERC misapplied the law by ( 1) failing to engage in the balancing test set out in Fire
Fighters, 113 Wn.2d at 203; and ( 2) determining that Section 18. 2 is a permissive subject of
bargaining. Second, Community Transit argues that PERC exceeded its statutory authority by
creating a novel unfair labor practice. - Third, Community Transit argues that PERC' s order was
arbitrary and capricious because it summarily determined that Section 18. 2 was a permissive
subject of bargaining. We disagree.
The Administrative Procedure Act (APA), ch. 34. 05 RCW, governs this court' s review of
PERC' s order in an unfair labor practice case. RCW 41. 56. 165; Pasco Police Officers' Ass' n v.
City of Pasco, 132 Wn.2d 450, 458, 938 P. 2d 827 ( 1997). Under the APA, the party challenging
4 PERC chose not to appear in the superior court or defend its order on judicial review.
5 In support of Community Transit' s argument, the Washington State Association of Municipal
Attorneys filed a brief as amicus curiae.
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No. 43783 -0 -II
the agency' s action bears the burden of demonstrating its invalidity. RCW 34. 05. 570( 1)( a).
There are nine circumstances under which we may grant relief from an agency order, including
1) the order is outside the agency' s statutory authority, ( 2) the agency has erroneously
interpreted or applied the law, and ( 3) the order is arbitrary and capricious. RCW
34. 05. 570( 3)( b), ( d), ( i). When reviewing agency action under the APA, we sit in the same
position as the superior court and apply. the APA standards to the record before the agency.
Mader v. Health Care Auth., 149 Wn.2d 458, 470, 70 P. 3d 931 ( 2003). Accordingly, we review
PERC' s order, not the decision of the superior court or the hearing examiner. City of Vancouver
v. Pub. Emp' t Relations Comm' n, 107 Wn. App. 694, 703, 33 P. 3d 74 ( 2001), review denied, 145
Wn.2d 1021 ( 2002).
We review PERC' s conclusions of law de novo and may substitute our interpretation of
the law for that of PERC. Pasco Police, 132 Wn.2d at 458. At the same time, we give " due
deference" to an administrative agency on matters falling within its area of expertise. Port of
Seattle v. Pollution Control Hearings Bd., 151 Wn.2d 568, 595, 90 P. 3d 659 ( 2004). PERC has
expertise in labor relations. Christensen v. Grant County Hosp. Dist. No. 1, 152 Wn.2d 299,
319, 96 P. 3d 957 ( 2004). Therefore, PERC' s expertise in labor relations deserves the due
deference of a reviewing court. See Pub. Emp' t Relations Comm' n v. City of Kennewick, 99
Wn.2d 832, 842, 664 P. 2d 1240 ( 1983).
Community Transit argues that PERC erroneously interpreted or applied the law because
1) PERC failed to conduct the balancing test adopted in Fire Fighters, and (2) PERC concluded
that Section 18. 2 was a permissive subject of bargaining. We disagree. Here, the Fire Fighters
balancing test would be necessary if Section 18. 2 were a management rights clause; however,
because PERC already determined that Section 18. 2 is a waiver clause, PERC appropriately
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No. 43783 -0 -II
applied its earlier decision in " atcom County to conclude that Section 18. 2 is a permissive
subject of bargaining.
Washington law distinguishes between mandatory and permissive subjects of collective
bargaining. See, e. g., Yakima County v. Yakima County Law Enforcement Officers' Guild, 174
Wn. App. 171, 181, 297 P. 3d 745, review denied, 178 Wn.2d 1012 ( 2013). On mandatory
subjects, the parties must bargain in good faith; if they reach an impasse on a mandatory subject,
their dispute will be resolved through interest arbitration. Pasco Police, 132 Wn.2d at 460 -61.
In contrast, the parties may bargain on permissive subjects, but they are not required to do so.
Klauder v. San Juan County Deputy Sheriffs' Guild, 107 Wn.2d 338, 342, 728 P. 2d 1044 ( 1986).
Insisting to impasse on a provision addressing a permissive subject is an unfair labor practice.
Klauder, 107 Wn.2d at 342. The distinction between mandatory and permissive subjects of
from definition bargaining" in RCW
collective bargaining derives the of " collective
41. 56. 030( 4). See Fire Fighters, 113 Wn.2d at 200. That definition imposes a mutual obligation
on a public employer and a union to execute a collective bargaining agreement that governs
grievance procedures and ... personnel matters, including wages, hours and working
conditions." RCW 41. 56. 030( 4).
Accordingly, grievance procedures and " matters of direct concern to employees," such as
wages, hours, and working conditions, are categorized as mandatory subjects of collective
Fire Fighters, 113 Wn.2d 200; City of Pasco, 119 Wn.2d at 512. In contrast,
bargaining. at
other subjects are permissive subjects on which the parties are not required to bargain. Klauder,
107 Wn.2d at 341 -42; see RCW 41. 56. 030( 4). Permissive subjects may include managerial
decisions with attenuated effects on personnel matters; the exercise of managerial or union
prerogatives; and the procedures used to establish contract terms on wages, hours, and working
CI
No. 43783 -0 -II
conditions. Fire Fighters, 113 Wn.2d at 200; Klauder, 107 Wn.2d at 341 -42. Whether a
proposed contractual provision addresses a mandatory or permissive subject of bargaining
depends on the facts of each case. Fire Fighters, 113 Wn.2d at 203.
As an initial matter, Community Transit argues that PERC misapplied the law because
Fire Fighters has created a balancing test that must be used whenever PERC determines whether
a provision is a mandatory or permissive subject of bargaining. However, Fire Fighters requires
that PERC engage in a case -by -case analysis to determine whether a proposed contractual
provision addresses a or permissive subject of bargaining. 113 Wn. 2d at 203. But
mandatory
PERC is not required to engage in the balancing test every time it is tasked with determining
whether an issue is a mandatory or permissive subject of bargaining. See Pasco Police, 132
Wn.2d at 459 -68 ( making no mention of the balancing test and deciding that a provision' s
subject was mandatory, not permissive). Specifically, there are some issues that are mandatory
or permissive as a matter of law; for example, employee wages, hours, and working conditions
are mandatory subjects of bargaining. PERC would not be required to apply the Fire Fighters
balancing test to a provision that deals exclusively with employee wages, hours, or working
conditions because that provision must be a mandatory subject of bargaining. The balancing test
is meant to be used when a provision addresses both a mandatory subject of bargaining ( e. g.,
wages, hours, and working conditions) and permissive subjects of bargaining ( i.e., managerial
prerogatives). See Fire Fighters, 113 Wn.2d at 203. Section 18. 2 is exclusively a waiver
provision and does not address both mandatory and permissive subjects, so there is nothing to
balance and the balancing test is not appropriate. Accordingly, PERC did not misapply the law
when it did not conduct the Fire Fighters balancing test.
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The parties also dispute whether Section 18. 2 addresses a mandatory or permissive
subject of bargaining. Section 18. 2 states,
Community Transit] agrees tonotify [ Amalgamated] of any changes in the
Employee' s Rule and Regulations, including Standard Operating Procedures
SDP' s) and Performance Code, affecting employees in the Bargaining Unit. The
grievance procedure [ established in Article 14] shall not apply to any matters
covered by this section, except as to [ Community Transit' s] administration of
such provisions resulting in employee appeal of his /her discharge or suspension
only as per Article 14 of this Labor Agreement.
Administrative Record at 132.
As explained above, PERC had already characterized Section 18. 2 as a waiver provision.
Amalgamated, 1998 WL 1978452, at * 6. As PERC correctly noted in its decision here, its earlier
decision governs the characterization of Section 18. 2 as a waiver provision. PERC' s 1998
decision did not directly address whether Section 18. 2 was a mandatory or permissive subject of
bargaining. Therefore, here, PERC was required to determine whether the waiver provision in
Section 18. 2 was a mandatory or permissive subject of bargaining.
No Washington court has decided whether a provision waiving a party' s statutory
is mandatory See Pasco Police, 132 Wn.2d at 463. But in 2004,
bargaining rights or permissive.
PERC concluded that " a broad waiver of statutory [ bargaining] rights" is a permissive subject of
bargaining. Whatcom County, 2004 WL 725698, at * 7; accord Int' l Ass' n of Fire Fighters,
Local 1604 v. City of Bellevue, No. 23828 - - - 6082, 2013
U 11 WL 3784086, at * 6 ( Wash. Pub.
Emp' t Relations Comm' n July 12, 2013) ( submitted as additional authority by Amalgamated).
In light of PERC' s prior decision that Section 18. 2 waived Amalgamated' s statutory right to
bargain changes to the employee rules to impasse, it follows that Section 18. 2 is a broad waiver
and therefore a permissive subject of bargaining. See Whatcom County, 2004 WL 725698, at * 7.
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Attempting to distinguish Section 18. 2 from the broad waiver in Whatcom County,
Community Transit argues on two grounds that Section 18. 2 is not broad. First, the scope of
Section 18. 2 is broad. In Whatcom County, a broad waiver allowed the employer to adopt new
rules on any subject on which the parties' collective bargaining agreement was silent. 2004 WL
725698, at * 10- 11. Community Transit asserts that, in contrast, Section 18. 2 merely waives
Amalgamated' s right to bargain " subjects specifically listed in [ Section] 18. 2," i. e., changes to
the employee rules, standard operating procedures, and performance code. Br. of Appellant at
40. But Community Transit' s assertion belies the parties' history and the record. In the course
of 123 pages, the standard operating procedures govern practically every aspect of working
conditions. Section 18. 2 is unquestionably broad.
Second, Community Transit attempts to distinguish Section 18. 2 from the broad
procedural" waiver in Whatcom County. This contention is also unpersuasive. Even the broad
waiver in Whatcom County preserved an opportunity for the union to contest the employer' s
changes to working conditions during the life of the contract by allowing the union to object to
2004 WL 725698, at
the changes and providing for arbitration of any unresolved objections.
10. But Section 18. 2 excludes Amalgamated from the process to an even greater degree: it
eliminates any real opportunity for Amalgamated to contest Community Transit' s changes to the
employee rules. Like the waiver in Whatcom County, Section 18. 2 allows Community Transit to
make changes to rules and procedures without having to deal with the union.
Although it undoubtedly has an indirect impact, a broad waiver of Amalgamated' s right
to bargain over changes to the employee rules is not a matter of direct concern to employees.
Instead, as PERC explained in Whatcom County, this broad waiver addresses " the relationship
between the employer and union, by enabling the employer to change work rules without having
C
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to deal with the union." 2004 WL 725698, at * 4. Because this broad waiver of Amalgamated' s
right to bargain does not directly concern working conditions, Section 18. 2 addresses a
permissive, rather than a mandatory, subject of bargaining. Whatcom County, 2004 WL 725698,
at * 4; see Fire Fighters, 113 Wn.2d at 200. Therefore, PERC' s order is not based on an
erroneous application of the law.
Community Transit' s remaining arguments rest on assumptions which we have already
held meritless. Community Transit argues that PERC exceeded its statutory authority by
creating a new unfair labor practice; namely, insisting to impasse over a mandatory subject of
bargaining. See RCW 41. 56. 140; Pasco Police, 132 Wn.2d at 460 -61. However, for the reasons
explained above, PERC correctly determined that Section 18. 2 is a permissive subject of
bargaining. Accordingly, Community Transit' s argument must fail.
Community Transit also argues that PERC' s order was arbitrary and capricious because
PERC failed to apply the Fire Fighters balancing test. However, the Fire Fighters balancing test
was superfluous in this case. PERC made a well reasoned decision to apply its earlier decision
dealing with the subject matter. Therefore, it also follows that PERC' s order is not arbitrary and
capricious. Port ofSeattle, 151 Wn.2d at 589 ( An agency order is not arbitrary and capricious if
the agency acted honestly and upon due consideration.)..
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Community Transit has not met its burden to show that PERC misinterpreted or
misapplied the law, PERC acted outside its statutory authority, or PERC' s order was arbitrary
and capricious. RCW 34. 05. 570( 1)( a), ( 3). Accordingly, we affirm PERC' s order.
A majority of the panel having determined that this opinion will not be printed in the
Washington Appellate Reports, but will be filed for public record in accordance with RCW
2. 06. 040, it is so ordered.
Q INN- BRINTNALL, J.
MAXA, J.
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