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January 27, 2011

California Supreme Court Holds Decisions to Lay Off Are Nonnegotiable But PERB’s Decision Not to Issue a Complaint Is Reviewable in Limited Circumstances

The California Supreme Court upheld a longstanding rule that public agencies are not obligated to negotiate the decision to lay off employees, while also determining that in limited circumstances, the courts may review PERB’s decision not to issue an unfair practice complaint. [International Association of Fire Fighters, Local 188, AFL-CIO v. Public Employment Relations Board (City of Richmond) (1/24/11) S172377]


The City of Richmond decided to lay off 18 firefighters for financial reasons. The union sought to negotiate the decision, arguing there were other cost-saving measures and the cuts would affect the safety of the remaining firefighters. The city refused to negotiate the decision but met with the union to negotiate the effects of the layoffs. The union filed an unfair practice charge with the Public Employment Relations Board, which declined to issue a complaint. The union applied for a writ of mandate in Superior Court, challenging PERB’s decision not to issue a complaint. The lower courts held such decisions are reviewable in limited circumstances, but affirmed PERB’s decision not to issue a complaint.

Availability of Judicial Review

This case arose under the Meyers-Milias-Brown Act (MMBA), which provides that a complainant is not entitled to judicial review of a PERB decision not to issue a complaint. Notwithstanding that language, the Supreme Court determined that in limited circumstances, such review is available: (1) where the complaining party alleges violation of a constitutional right; (2) where PERB exceeds a specifi c grant of authority; and (3) where the agency’s decision is based on an erroneous construction of an applicable statute.

The Court held that in this case, the union alleged PERB erroneously interpreted the law when it declined to issue the complaint and therefore the decision was reviewable. The Court emphasized that review is not available for “ordinary error, including insufficiency of the evidence to support the agency’s factual findings and misapplication of the law to the facts, or for abuse of discretion.”

Decisions to Lay Off Are Not Negotiable

The Court then turned to the substance of the case, whether a public employer is obligated to negotiate the decision to eliminate bargaining unit positions. The union contended that where the cuts are solely for cost savings, or the layoffs implicate safety issues, the agency should be required to negotiate the decision as well as the effects. This argument is contrary to well-established PERB case law holding employers are not obligated to negotiate the decision to lay off except in very limited circumstances.

Relying on a 1974 Supreme Court decision, the Court held a public entity may unilaterally decide to lay off some of its employees to reduce its labor costs. The employer must, however, give the union an opportunity to bargain over the implementation of the decision, including the timing of the layoff, and other effects on the workload and safety of the remaining employees.


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