In government, major policy decisions are made by the elected members of a local legislative body — a city council or county board of supervisors, for example. The primary public-sector bargaining law in California, the Meyers-Milias- Brown Act, expressly states that a labor agreement “shall not be binding” until it is approved by the governing body. While labor agreements are approved by governing bodies, those bodies “delegate” much of their work; if they didn’t, their seemingly interminable meetings would be, well, actually interminable. That work includes most of the tasks associated with administering labor agreements, including arbitration of disputes.
Under established government law principles, major policy decisions must be made by the legislative body itself — they can’t be “delegated” to others. Such decisions are considered “nondelegable duties.” The concept of the nondelegable duty may not be sexy, but it’s basic to democracies. There are certain policy decisions that we elect legislators to make and for which the public has a right to hold legislators accountable.
Background
In the wake of California’s adoption of public-sector collective bargaining in the ’60s, questions arose about whether arbitration of contract disputes — a fundamental aspect of private-sector bargaining — was a permissible delegation. The issue was put to rest in the seminal case of Taylor v. Crane.
In that case, the California Supreme Court held that having an arbitrator review whether a disciplinary action by a city manager complied with the terms in a collective bargaining agreement didn’t amount to an unlawful delegation of legislative authority. But the court strongly suggested there were limits to how and when arbitration was permissible.
In short, the court suggested that when an arbitrator is actually determining the terms and conditions of employment, arbitration may in fact constitute an unlawful delegation of authority. “The power to set the terms and conditions of public employment,” the court reasoned, “is broader and more intrusive upon the functions of city government than the arbitrator’s authority in this case to resolve an individual grievance.” The latter point was soon forgotten like the buried treasure of a dead man.
Recent case
A few weeks ago, more than 30 years after the Taylor ruling, that sentence surfaced with a vengeance in a case before the California Court of Appeal. In the case, the court of appeal held that the question of whether involuntary furloughs were permissible under a declared state of fiscal emergency couldn’t legally be submitted to arbitration because the delegation to the arbitrator was in essence a delegation of legislative power: “As the decision to impose mandatory furloughs due to a fiscal emergency is an exercise of the City Council’s discretionary salary setting and budget making authority, the City Council cannot delegate this authority to an arbitrator.”
This case will almost certainly be heard by the California Supreme Court or “depublished.” (If the case is depublished, its conclusion would stand, but it couldn’t be cited in the future.) Whatever the supreme court decides, this case is an important reminder that major labor relations decisions should be made by elected officials because they’re inextricably tied to decisions about public services. City of Los Angeles v. Superior Court — Cal. App. 4th — 2011 WL 1088039 (March 25, 2011; certified for publication).
Bottom line
We speak of open government, yet there is often little public debate about the impact of labor decisions on other government services. Allowing such decisions to be made in arbitration behind closed doors may be acceptable in the private sector, but it’s hard to justify in the public sector when the stakes include public services.
The term “nondelegable duties” may not be very exciting, but we’re likely to hear a lot more about them in the next five years than we did in the previous 30. And that’s good for the public and for local government services.
For further information, please contact:
Jon Holtzman
jholtzman@publiclawgroup.com
415.848.7235