Tacoma-Pierce County Health Dept., Decision 6929-A (PECB, 2001)

STATE OF WASHINGTON BEFORE THE PUBLIC EMPLOYMENT RELATIONS COMMISSION
WASHINGTON STATE COUNCIL OF COUNTY AND CITY EMPLOYEES, LOCAL 120,
Complainant,	CASE 14710-U-99-03693
vs.	DECISION 6929-A - PECB
TACOMA-PIERCE COUNTY HEALTH DEPARTMENT,	FINDINGS OF FACT, CONCLUSIONS OF LAW,AND ORDER
Respondent

David M. Kanigel, Legal Counsel, appeared on behalf of the union.

Summit Law Group, by Otto G. Klein, III, appeared on behalf of the employer.

On July 26, 1999, the Washington State Council of County and City Employees, Local 120 (union) filed a complaint charging unfair labor practices under Chapter 391-45 WAC, naming the Tacoma-Pierce County Health Department (employer) as respondent. A deficiency notice issued on August 23, 1999, under WAC 391-45-110, pointed out a lack of factual allegations supporting a “domination” allegation indicated by a check mark on the complaint form. The union did not amend the complaint, and the deficient allegation was dismissed on January 7, 2000.[1]A preliminary ruling was issued finding a cause of action to exist with respect to the following allegations:

1.                  That the employer interfered with em­ployee rights and refused to bargain when it unilaterally implemented a staff reorg­aniza­tion of the department’s Metha­done Program, resulting in the layoff of six bargaining unit employees.

2.                  That the employer interfered with em­ployee rights and refused to bargain when it unilaterally filled newly created positions performing substantially the same job responsibilities with new hire [sic], while declaring them to be outside of the of the bargaining unit and paying them a lower wage than the positions formerly in the bargaining unit.

3.                  That the employer circumvented the union and dealt with the affected bargaining unit employees, by informing them that they must reapply for the new, non-union positions.

A hearing was held on April 7, 2000, before Examiner Walter M. Stuteville. The schedule for filing briefs was extended several times, at the request of the parties, to facilit­ate settlement discussions, but those discussions did not result in resolution of the issues. Briefs were filed January 16, 2001.

The Examiner concludes that the union failed to prove that the employer refused to bargain in good faith. The decision to reorganize is not a mandatory subject of bargaining, and it was clear from the evidence that the employer changed the basic nature of the services that it had been delivering to the public. The allegation that the employer refused to negotiate the effects of the reorganization is also dismissed because the evidence shows that the parties had negotiated reorganization procedures and committed them to writing in their collective bargaining agreement. Finally, the employer did not commit an unfair labor practice when it discussed the proposed reorganization with its employees, because the discussions that occurred were a part of the reorgani­zation process, the discussions did not include wages, hours or conditions of work, t­he union had been notified prior to the actual implementation of layoffs, and the discussions were not official notice of impending layoffs.

BACKGROUND

The employer is the local government agency charged with protecting the health of people in Pierce County. It is an independent governmental body operating under a board of health and one of its core missions is disease prevention. Following a shift of departmental policy during or about 1993, the employer’s stated goal has been to ensure that specific health services are available to the public, rather than directly providing such services. The employer has gone through several different program reorganizations since 1993, in order to transition programs out of the health department because they were inconsistent with the focus on prevention. As an example, the employer formerly staffed community clinics throughout the county, but eventually moved those direct service functions to community providers which were then monitored by the employer. Similarly, the federally funded Women, Infants and Children program (WIC) was moved to a private provider in 1998.

Reorganization of the Substance Abuse Program

For many years prior to 1999, the employer provided a substance abuse/methadone program based upon what it termed a “therapeutic” model. The program was designed to cure substance abuse by using a combination of counseling and medication. The program staff included registered nurses, therapists and office-clerical employees. The direct services provided by these employees in this program were, since 1993, an exception to the employer’s “preven­tion” policy.

The union has represented certain employees of this employer for more than 50 years. The parties’ collective bargaining agreements have covered employees classified as office assistant 1 (OA1), office assistant 2 (OA2) and office assistant 3 (OA3). The employer’s job specifications for the OA2 classification is typical, and includes the following “summary” skills list:

KNOWLEDGE, SKILLS AND ABILITIES

•                     Knowledge of general office procedures and practices.

•                     Knowledge of grammar, spelling and punc­tuation.

•                     Knowledge of and ability to apply basic math skills to work performed.

•                     Skill in communicating orally using tact and diplomacy.

•                     Skill in keyboarding with speed and accu­racy (net 45 wpm).

•                     Ability to operate standard office equip­ment, i.e. computers, cash registers, calculators, copiers, Dicta­phones, multi-line telephones, etc.

•                     Ability to apply basic record-keeping principles and practices to work per­formed.

•                     Possession of a valid driver’s license.

Six employees in the various “OA” classifications were assigned to the substance abuse program.

As previously stated, discussion of whether the substance abuse program was consistent with the employer’s prevention focus commenced during or about 1993.By 1998, those discussions had developed to the point of planning for a transition of the program to one or more private providers. The employer’s role following such a transition would have been limited to monitoring the private providers to ensure that the quality of service met appropriate public health standards. This was to be similar to the earlier changes made in the community clinic and WIC programs.

The employer’s decision to cease providing the substance abuse program and to move the program to a private provider was approved by the Tacoma-Pierce County Board of Health, the Tacoma City Council and the Pierce County Council. The employer set July 1, 1999, as its target date for termination of its substance abuse program, and its budget for 1999 only funded the program for January through June. By January of 1999, however, it became evident that licensing requirements and restrictions would make it impossible to have a non-governmental agency completely take over the program.

Therefore, as of January 1999, the employer had to refocus its planning. It decided to reorganize the program under a “harm reduction” approach. This new program was not designed to make clients drug-free, but rather was to provide them with a mainte­nance program that would enable them to function in society. The counseling emphasis of the then-existing program was to be replaced by providing and monitoring medication. The rationale for instituting such a new model was to prevent or reduce the innumera­ble costs associated with drug addiction, while at the same time serving more clients and generating more fees. Fees that would eventually make the program self-sustaining.

On February 26, 1999, the director of the Health Department, Frederico Cruz, sent a notice concerning reorganizing the substance abuse/methadone program to the department staff, as follows:

This afternoon Deo Tiam, the substance abuse program manager met with staff to outline the proposed new structure for our Methadone program. Changes are recommended that affect both the direction of the program and the structure and staffing. The goal is to assure that the methadone program has a greater impact on the health of our community. We are not serving as many clients as we need to. There are a large number of heroin users in our community who can not get into our pro­gram. Our plan calls for a significant in­crease in caseload. At the same time it recognizes that we do not have additional revenues to invest. The plan calls for a re-alignment of staff and the hours of operation to increase our cost effectiveness.

If you have an interest in any aspect of the changes, copies of the position paper and of the new structure can be obtained from Deo or Jesse James. The proposed changes will be reviewed at a future board meeting.

This new program direction brought about a significant impact on department personnel. Where the former program had primarily been run by registered nurses, in the new program, a physician was responsible for determining methadone dosages and licensed practical nurses would be administering the drugs. More relevant to the instant case, the new program staff would be responsible for preparing examination rooms and necessary medical equipment, for making patient appointments with the physician, and would be performing blood tests and urinalysis observations. Therefore, the employer determined that the new program staff should be aides and medical office assistants instead of office assistants.

The employer has had two classifications of employees performing medical office support functions (“health department aide” and “medical office assistant”), which it decided to utilize in the new program. These classifications were not represented for the purposes of collective bargaining. The job description for the Health Department Aide contains the following information concern­ing the scope of responsibilities for that position:

Essential functions of the job include: as­sisting technical and professional employees within the Substance Abuse Services Program; observing urine collection; packag­ing urine samples for shipment; reconciling urinalysis records; performing height and weight measures for clients; providing inform­ation to clients on basic Health Department services; assisting in obtaining basic client information upon initial visits to the Health Department; and performing general office functions, i.e., filing, data entry, etc. Other general duties and respo­nsibilities assigned to a Health Department Aide may include: assisting in nontechnical health screening tests such as blood press­ure checks and performing hearing and vision tests; all under professional supervision.

The employer’s job specifications for the “medical office assis­tant” classification includes the following:

MEDICAL OFFICE ASSISTANT - Substance Abuse Program

Clinical/Medical Services

•                     Takes patient/client’s vital signs, height, weight, etc., and assists with undressing, draping and positioning for procedures.

•                     Assists in coordinating client/patient flow throughout the clinic.

•                     Sets up examining rooms, equipment and supplies for procedures.

•                     Cleans and maintains examining rooms, and performs gas and chemical sterilization of clinical equipment and laboratory appara­tus.

•                     May perform minor invasive procedures to withdraw blood from client/patient.

•                     May perform technical tasks such as auto­claving; observing patient/client urinaly­sis; and perform­ing basic lab procedures such as urinalysis, pregnancy tests, frac­tional urines, specimen processing, hematocrit­s, etc.

•                     May prepare laboratory media, stains, and reagents and buffer solutions.

•                     May exchange needles and syringes with high risk groups using universal precau­tions. (Needle exchange program).

GENERAL OFFICE SUPPORT

•                     Schedules patient/client appointments and makes referrals to outside agencies when appropriate; and prioritizes inco­ming triage calls.

•                     Prepares and types registration inform­ation, letters, medical reports, inven­tory forms, and billing information.

•                     Files client/patient records, reports and general correspondence. Receives patient/ client and registers and logs them in, according to program protocols.

•                     M­ay transcribe physician notes for client/ patient records.

•                     Processes materials, correspondence, re­cords, and other clerical activities which normally facilitate the work of others or provide services on a timely basis.­

On March 17, 1999, Program Manager Tiam sent a memo to the substance abuse staff, outlining openings which would become available as a result of the program restructure. That memo included:

1.                        Applications for the Chemical Dependency Treatment Liaison position will be ac­cepted through March 19, 1999.Plan­ned hiring for the two positions (one at Meth­adone and another at MOMS) is by the end of April;

2.                        As a consequence of relative major staff restructuring in the Methadone and very minor adjustments in the MOMS programs, we will be filling Medical Office Assistant, Health Department Aide and Licensed Prac­tical Nurse positions. One DATC II posi­tion in the methadone program will also be available. All these vacancies will be announced starting April 11^th and filled by the first week of June. Orientation and training will take place the last week or two of June.

if [sic] you have any questions regarding these openings, please refer to the pro­gram plan documents. A copy of the Metha­done plan is available through Jesse or myself and a copy of the MOMS plan is available through David B. or myself. Also, feel free to contact the Human Re­sources Office.

The Board of Health is aware of changes planned for the substance abuse program­s. If the Board takes any formal action it will not be during the April meeting since neither the Director nor the Deputy can attend that meeting. If there are changes to the plan, because of Board action, I’ll let you know.

I understand that these times are most trying and painful to a number of employ­ees. I would like to urge everyone to be sensitive to what some of our colleagues are going through. I realize that some employees will begin to accept positions elsewhere. This is completely understand­able and our than­ks go to those employees for their dedication and contributions.

I urge all of us to keep our attention focused on the tasks in front of us. Our clients and patients continue to count on us for service and assistance. There will be times when resources will be a bit lacking. We will do all we can to address this issue in as timely fashion as possi­ble.

According to testimony of Dorene Novotny, who was then the employer’s human resources manager, she gave notice of the employer’s decision to restructure the substance abuse/methadone program and the resulting changes to Tom Michel, the union’s staff representative at that time.

The Parties’ Collective Bargaining Agreement

The employer has collective bargaining relationships with three unions representing its employees. The employer and each of those organizations had negotiated contract language which both: (1) acknowledges the employer’s right to determine which programs it will offer and operate; and (2) describing the procedures for reductions-in-force. The collective bargaining agreement between the employer and this union includes the following relevant language:

ARTICLE 6 - MANAGEMENT RIGHTS

6.1        The direction of its working force is vested exclusively in the Health Depart­ment. This shall include but not be limited to, the right to:

. . .

a.                   direct employees;

b.                  hire, promote, transfer, assign, reas­sign, and retain employees.

c.                   suspend, demote, discharge or take other legitimate disciplinary action against employees for cause;

d.                  relieve employees from duty because of lack of work or other legitimate reasons;

e.                   maintain the efficiency of the operat­ion entrusted to the Health Department;

f.                   determine the methods, means, and person­nel by which such operations are to be conducted, and

g.                  take any actions necessary in conditions of emergency, regardless of prior commit­ments, to carry out the mission of the agency;

. . .

6.3         The Department shall give the Union rea­sonable advance notice prior to the exer­cise of any management right that, in the Department’s opinion, may adversely af­fect a represented classific­ation, and shall engage in any impact bargaining required by RCW 41.56, as amended.

. . .

ARTICLE 14 - REDUCTION IN FORCE

14.1      IN GENERAL. A reduction in force is the elimination of a bargaining unit position without prejudice and without reflecting discredit on the services of the incum­bent whenever such action is made nece­ssary by reason of shortage of work or funds, the abolition of a position be­cause of changes in organization, or other reasons outside the incumbent’s control. The incumbent laid off will shall be given receive [sic] fourteen (14) calendar days notice in writ­ing by from [sic] the Human Resou­rces Manager. Any interruption of employment not in excess of fifteen (15) calendar days because of unexpected or unusual reasons shall not be considered a layoff.

14.2      NOTICE. . . .

14.3      DIRECTOR OF HEALTH’S POWERS. In the event of a layoff, the Director of Health shall determine the numbers and classifi­cations of any positions to be reduced.

14.4      ELIGIBILITY TO EXERCISE RIGHTS OF SENIOR­ITY. . . .

14.5      RIGHTS OF SENIORITY. . . .

14.6      VOLUNTARY DEMOTION. . . .

14.7      EMPLOYEE’S OPTIONS. . . .

14.8      REEMPLOYMENT LIST. . . .

14.9      PROJECT EMPLOYEES. . . .

(paragraph titles included without complete text, to illustrate the scope of parties’ agreements).

According to testimony that was not refuted by the union, the parties met approximately twice a month dealing with these issues, beginning in September of 1998 and continuing into 1999.Both parties had changes of representatives in March of 1999:Michel was replaced by Bill Keenan, a long-time union representative; Novotny was replaced by Vivienne Kamphaus, who had formerly been a senior personnel analyst in the employer’s human resources department.

The reorganization of the substance abuse program was a subject of a letter Keenan wrote to the employer on March 26, 1999, soon after taking over for Michel:

[I]t has been brought to my attention that a reorganization has been announced in the Methadone program and MOMS program. This reorganization may result in the creation of new positions, the deletion of existing posi­tions, the transferring of work from one position to another and possible adjustments to existing classifications. All of these changes have a major impact on the working conditions of our members that may include but not limited to: wages, promotions, layoffs, recall, bumping and transfers etc.

Let this letter serve as notice to commence negotiations on the above mentioned reorgani­zation and its impact on our members. We expect that no phase of the proposed reorgani­zation will be implemented prior to the suc­cessful conclusion of the negotiation. That would include the posting of any proposed new positions for hiring.

. . .

On April 7, 1999, Kamphaus sent a letter addressed to both Michel and Keenan. She formally notified the union of the reorganization and the resulting layoffs, and she listed employees who would be affected by the reorganization, as follows:

The Substance Abuse Program will be reorganiz­ing effective July 1, 1999. As you are al­ready aware, the reorganization impacts the Office Assistants assigned to the Program. The following people are being affected on July 1, 1999.

OA III	Paula Marush	Exercise Seniority/Bump Less Senior OAII (Rozelle Hall)
OA II	MyrleneTjemsland Robbie Hensen Diane Kropf Alta Long Rozelle Hall	Layoff Layoff Layoff Layoff Layoff

You have already expressed an interest in meeting with the department in regards to the impacts the reorganization has on the Office Assistants assigned to the Substance Abuse Program in accordance with RCW 41.56.Cliff Allo and I have our calendars open during the following dates and times. Please let me know which of the following will meet with your satisfaction to review impacts to staff:

. . .

The Office of Human Resources will be working diligently with staff impacted to provide resources, counseling and opportunities for a successful personal and professional transi­tion.

At a meeting between the parties on April 29, 1999, the union presented the employer with the following proposals:

1)                 The new proposed Health Department Aide and Medical Office Assistant positions should not be advertised, posted or ap­proved by the Board of Health until these negotiations are completed.

2)                 All of the Health Department Aides, Medi­cal Office Positions, and MOA-1's (if they exist) should be covered by Local 120, as they are going to be performing our Bargaining Unit work.

3)                 Do to the fact an approximate 25% in­crease in workload could occur as a re­sult of the reorganization, the current level of staffing should be maintained.

4)                 The Medical Office Assistant(1) should be paid at the same level as the existing Office Assistant 3. ($13.11-16.78)

5)                 Paulette March, (OA-3) should be placed in the proposed Medical Office Assistant position. She should be given any train­ing necessary to meet any new require­ments of her position. She should not be required to reapply for her own reorga­nized position.

6)                 Diane Kropf (OA-1), MyrieneTjemsland (OA-1), Robbie Henson (OA-1), and Alta Long (OA-1) should all be placed into the proposed Health Department Aide positions as they currently meet or exceed the proposed job requirements. They should not be required to reapply for their own reorganized positions. In addition to the above these individuals should be allowed the first opportunity to bid on the new MOA-1 position prior to other Health Department employees or the pub­lic.

7)                 Rozelle Hall should remain as an OA-2 in her current position.

According to the union, the employer’s representatives did not offer any counter-proposals at the meeting, but only stated that they would get back to the union with the employer’s responses.

Kamphaus sent the following written reply to Keenan on May 3, 1999:

A meeting was held this morning with Amadeo Tiam, Public Health Manager, to review the issues you presented to Cliff Allo and myself during the impact bargaining session for Local 120 on April 29, 1999.Mr. Tiam was heartened by the employees’ interest in the new classi­fications but quite taken aback when I shared that staff had indicated to you that “manage­ment” had not taken the time to meet with them to talk about the reorganization. Mr. Tiam indicated that he met with staff back in March to share the organizational structure and the Director of Health’s expectations for the program. In addition, Mr. Tiam indicated that staff have since individually sought him out to discuss the reorganization.

Both Cliff and I appreciated your acknowledg­ment of the department’s management rights to determine the program’s organizat­ional struc­ture, staff levels, services to be rendered, etc. We intend to keep our personnel prac­tices consistent with prior reorganizations. This includes determining the appropriate staffing levels and job classifications for the reorganization, and the process of maxi­mizing job opportunities for staff affected by the reduction in force by having a competitive recruitment process in place for them to compete for job openings.

Although the Medical Office Assistant (MOA) is not represented by Local 120, there appeared to be a concern from employees regarding its pay as we discussed. The MOA is the same range as the Office Assistant II and the LPN I. The department will be reviewing results from the salary survey currently underway for our upcoming negotia­tions.

In addition, Mr. Tiam intends for the scope of work of the Medical Office Assistant to pro­vide maximum continuity for services both medical/technical and clerical within the new organizational structure.

In terms of responding to your issues regard­ing both the Health Department Aide and the Medical Office Assistant classification being recognized by Local 120, the persons selected to fill these positions will certainly have the right to elect and vote for union repre­sentation. However, as Cliff and I shared with you, the Public Employment Relations Commission will need to consider the duties, skills, and working conditions of the employ­ees. We believe the TPCPHEA would be a more appropriate bargaining unit.

Pending the approval of the Board of Health, the reorganization of the Substance Abuse Program will go into effect on July 2, 1999. Although the points in your list of sugges­tions go more to the content of the decision than bargaining the impact of the decision, we remain interested in discussing your concerns about the impacts. Please be assured, the Office of Human Resources will be working diligently with staff impacted to provide resources, counseling and opportunities for a successful personal and professional transi­tion for staff.

. . .

Additionally, Kamphaus wrote to Keenan on May 6, 1999, extending the ­deadlines for applications for the new MOA positions.

In response, Keenan left a telephone message for Kamphaus and Allo, in which he stated that he was cutting off bargaining and filing these unfair labor practice charges with the Commission.

POSITIONS OF THE PARTIES

The union contends the employer has unilaterally assigned its bargaining unit work to employees outside of the bargaining unit it represents. It charges that the employer refused to bargain in good faith when it refused to bargain either its decision to remove the work or the impacts on employees of the removal of that work. It further alleges that the employer committed an unfair labor practice when it directly communicated its reorganization andlayoff plans to bargaining unit members without prior notification to and negotiation with the union.

The employer defends that it was not required to negotiate its decision to restructure the substance abuse program because it is a permissive subject of bargaining. It does acknowledge that it was legally obligated to bargain the effects of its decision to restructure the substance abuse program, but it asserts that much of what would be negotiated had already been resolved through the parties’ collective bargaining agreement. As to the alleged skimming of bargaining unit work, the employer defends that the work of employees in the “health department aide” and “medical office assistant” classifications has never been done by union-represented employees, and that the union cannot now claim that work as a part of bargaining the impact of the program change. Finally, as to the charge of direct dealing, it responds that it had been talking to the union business representative Tom Michel continuously during this process and that it had never attempted to negotiate any layoff issues directly with the affected employees.

DISCUSSION

The Duty to Bargain

The collective bargaining obligation is both established and limited by statute:

RCW 41.56.030DEFINITIONS. As used in this chapter:

. . .

(4) “Collective bargaining" means the performance of the mutual obligations of the public employer and the exclusive bargaining representative to meet at reasonable times, to confer and negotiate in good faith, and to execute a written agreement with respect to grievance procedures and collective negotia­tions on personnel matters, including wages, hours and working conditions, which may be peculiar to an appropriate bargaining unit of such public employer, except that by such obligation neither party shall be compelled to agree to a proposal or be required to make a concession unless otherwise provided in this chapter. . . .

(emphasis added).

The potential subjects for bargaining between an employer and union are commonly divided into three categories: “mandatory," “permis­sive," and “illegal." Federal Way School District, Decision 232‑A (EDUC, 1977), citing NLRB v. Wooster Division of Borg Warner, 356 U. S. 342 (1958).

Mandatory Subjects of Bargaining -

Matters affecting the wages, hours, and working conditions of bargaining unit employees are mandatory subjects of bargaining about which employers and exclusive bargaining representatives are obligated to bargain in good faith, upon request.

It is well settled that wages (including overtime compensation and premium pay for various circumstances), health insurance benefits (an alternative form of wages), and hours of work (including shift schedules and work opportunities) are all mandatory subjects of bargaining. See City of Seattle, Decision 651 (PECB, 1979); City of Poulsbo, Decision 2068 (PECB, 1985).Decisions to transfer bargaining unit work to employees outside the bargaining unit are a mandatory subject of bargaining under precedents dating back to South Kitsap School District, Decision 472 (PECB, 1978).[2]

Permissive Subjects of Bargaining -

Matters of management or union prerogatives which do not affect wages or hours, or which are considered remote from "terms and conditions of employment" are categorized as non-mandatory or "permissive" subjects. The parties may bargain regarding permis­sive subjects, but are not required by law to do so.

Both Commission precedents and decisions under the National Labor Relations Act have held that employer decisions which go to the core of “entrepreneurial” control are only permissive subjects of bargaining. Even in Fibreboard Paper Products Corp. v. NLRB, 379 U. S. 203 (1964),[3] where the Supreme Court of the United States held that an employer's decision to contract out bargaining unit work is a mandatory subject of bargaining, the concurring opinion by Justice Stewart contrasted work assignments with several matters at the heart of entrepreneurial control. He listed as “permissive" several subjects which he viewed as having little relation to working conditions: Advertising, product design, commitment of investment capital, and the basic scope of the enterprise. See also City of Centralia, Decision 5282 (PECB, 1995).

Illegal Subjects of Bargaining -

The parties to a collective bargaining relationship have a legal obligation to refrain from bargaining matters which would result in an unlawful outcome (i.e., "illegal" subjects).City of Kalama, Decision 6739 (PECB, 1999).

The Balancing Test -

Some issues that arise at the workplace do not fall neatly into the "mandatory," "permissive," and "illegal" categories, or must be subdivided. For example: While medical plan specifications are a mandatory subject of bargaining, an employer does not necessarily breach its bargaining obligation by unilaterally determining the plan provider. City of Dayton, Decision 1990 (PECB, 1984). The Commission has utilized a balancing approach to determine whether a particular matter is a mandatory subject of bargaining and that approach has been endorsed by the Supreme Court of the State of Washington. IAFF, Local 1052 v. PERC, 113 Wn.2d 197 (1989).

The Decision / Effects Dichotomy -

The bargaining obligation is applicable as to both a decision on a mandatory subject of bargaining and as to the effects of that decision, but will only be applicable to the effects of a manage­rial decision on a permissive subject of bargaining. For example, compare: Skagit County, Decision 6348 (PECB, 1998) and City of Kelso, supra [Kelso I], where both the decision to contract out bargaining unit work and its effects on the employees were mandatory subjects of bargaining, with City of Kelso, Decision 2633 (PECB, 1988) [Kelso II], where the decision to merge with another employer was an entrepreneurial decision, and only the effects of that decision on employee wages, hours, and working conditions were mandatory subjects of bargaining. Similarly, while an employer has no duty to bargain concerning a decision to reduce its budget, under Spokane Education Association v. Barnes, 83 Wn.2d 366 (1974) and Federal Way School District, Decision 232‑A (EDUC, 1977), aff’d WPERR CD‑57 (King County Superior Court, 1978), the “effects” of such decisions could be mandatory subjects of collective bargain­ing. See also Wenatchee School District, Decision 3240‑A (PECB, 1990).

Unilateral Changes -

The status quo must be maintained regarding all mandatory subjects of bargaining, except where changes are made in conformity with the collective bargaining obligation or the terms of a collective bargaining agreement. City of Yakima, Decision 3501‑A (PECB, 1998), aff’d 117 Wn.2d 655 (1991); Spokane County Fire District 8, Decision 3661‑A (PECB, 1991); Pierce County Fire District 2, Decision 4146 (PECB, 1992). See also Rochester Institute of Technology, 264 NLRB 1020 (1982). An employer thus commits an unfair labor practice if it imposes a new term or condition of employment, or changes an existing term or condition of employment, upon its represented employees, without having exhausted its bargaining obligation under Chapter 41.56 RCW. City of Tacoma, Decision 4539‑A (PECB, 1994).

Notice of an occasion for bargaining must be given sufficiently in advance of the change so as to afford an opportunity for the party receiving notice to request bargaining and to present counter-proposals or arguments. See NLRB v. Katz, 369 U. S. 736 (1964), at 743; Gresham Transfer, 272 NLRB 484 (1984); NLRB v. Citizen Hotel Company, 326 F.2d 501 (5th Circuit, 1964); NLRB v. W. R. Grace and Co. Construction Products Div., 571 F.2d 279, at 282 (5th Circuit, 1978); Sun‑Maid Growers of California v. NLRB, 104 LRRM 2543 (9th Circuit, 1980). Similar conclusions were reached in City of Vancouver, Decision 808 (PECB, 1980) and City of Kelso, supra [Kelso II]. Accordingly, an employer violates RCW 41.56.140(4) if it presents a union with a fait accompli, or (if bargaining is requested) it fails to bargain in good faith to agreement or impasse. Federal Way School District, supra; Green River Community College, Decision 4008‑A (CCOL, 1993); North Franklin School District, Decision 5945‑A (PECB, 1998).

Waiver by Contract -

The parties to a collective bargaining agreement may create an exception to the duty to bargain. This is fully discussed in City of Kalama, Decision 6739 (PECB, 1999), as follows:

A "waiver by contract" defense is available where the matter at issue in an unfair labor practice complaint alleging a unilateral change is controlled by a collective bargain­ing agreement in effect between the parties. When a contract is signed, the parties will have met their bargaining obligations as to the matters set forth in the contract, those matters in essence become permissive subjects of bargaining for the life of the contract, and the parties are relieved of the duty to bargain them for the term of the contract. No unfair labor practice violation will be found if a party then acts or makes changes in a manner authorized by the contract, or consis­tent with established practice. North Frank­lin School District, Decision 5945‑A (PECB, 1998). The Commission does not assert juris­diction to remedy violations of collective bargaining agreements through the unfair labor practice provisions of the statute. City of Walla Walla, Decision 104 (PECB, 1976).

When called upon to do so, the Commission and its staff will interpret a collective bargaining agreement to determine the existence of a waiver by contract.

Application of the Standards

Decision to Restructure the Substance Abuse Program -

In this case, the employer’s decision to restructure its substance abuse program was a permissive subject of bargaining. The employer was changing the services to be delivered and how its staff would deliver services. Such decisions go to the heart of the entrepre­neurial control as described in Fibreboard, supra. Therefore, the employer did not commit an unfair labor practice when it rejected the union’s attempts to negotiate its decision to change the focus of its program. Port of Seattle, Decision 4989 (PECB, 1995) and City of Anacortes, Decision 6830 (PECB, 1999).

Decision to Change Employee Qualifications -

As a part of its restructuring decision, the employer substantially changed its job requirements: Registered nurses were replaced with a medical doctor and licensed practical nurses; office assistants were replaced with employees in the existing classifications of “health department aide” and “medical office assistant. ”These classificatio­ns were deemed more suited to the new body of work. Those decisions flow directly from the change of program mission and emphasis, and so also go to the heart of entrepreneurial control. The program change resulted in some cost savings due to utilizing some employees in lower-paid classifications than had been used in the past, but the evidence does not support a conclusion that the program change was motivated by labor costs. Rather, the change was both consistent with the employer’s general shift of policy, and designed to treat more clients. Therefore, the employer did not commit an unfair labor practice when it rejected the union’s attempts to negotiate its decision to change the types and qualifications of employees used in the restructured program.

The Bargaining of Effects -

The restructure of the substance abuse program had the effect of deleting six positions from this bargaining unit. The union responded to the proposed layoffs by submitting proposals on April 29, 1999. Those proposals and the employer’s responses to them are examined in detail below, but they are all generally defective.

1.                   Union Proposal: The health department aide and the medical office assistant positions would not be advertised or posted or approved until union effects negotiations are completed.

Employer Response: Neither the aide posi­tion n­or the assistant positi­on is cov­ered by the union’s collective bargaining agreement and the schedule of approval, posting and advertising is governed by Health Department policy.

Because the aide and assistant positions were not within the bargaining unit represented by the union, any issues concerning the approval, posting, or advertising of such positions were not “peculiar to the bargaining unit” under City of Wenatchee, Decision 2216 (PECB, 1985) and City of Pasco, 119 Wn.2d 504 (1992). The union’s proposals concerned a permissive subject of bargaining and the employer could lawfully refuse to bargain issues relating to the filling of these positions.

2.                   Union Proposal: The health department aide and medical office positions should be covered by the union’s collective bargaining agreement.

Employer Response: The employer would not agree to automatically shift the posi­tions into the union’s bargaining unit and referred the issue to the Commission.

Unit determination is not a subject for bargaining in the usual mandatory/permissive/illegal sense. City of Richland, Decision 279-A (PECB, 1978), aff’d29 Wn App 599 (1981), review denied 96 Wn.2d 1004 (1981). As correctly stated by the employer in this case, any dispute concerning the representation of employees must be submitted to the Commission. RCW 41.56.050.

3.                   Union Proposal: Due to a projected work­load increase the current level of staff­ing should be maintained; i.e. that pro­posed layoffs should not be implemented.

Employer Response: In determining that current staffing levels would not be maintained, the employer was exercising its right to determine staffing levels and organizational structure as detailed in the management rights section of the parties’ collective bargaining agreement.

The parties’ collective bargaining agreement clearly gave the employer the right to determine staffing levels and implement layoffs. Artic­le 6, sections 1.b (assign, reassign and retain employees) and 1. F (determine the methods, means and personnel). Article 14, section 1 of the parties’ contract details what, when, and how layoffs would be conducted, and recognizes the employer’s ability to eliminate positions, while sections 14.4 through 14.7 detail the procedures as to how a layoff is to be done. Those contract provisions support the employer’s argument that the union waived its right to demand negotiations on a layoff. Furthermore, Commission precedent holds that the determination of staffing levels is generally a permissive subject of bargaining. City of Centralia, Decision 5282‑A (PECB, 1996). Thus, the union’s proposal that the historical staffing level be maintained (and that the six employees not be laid off) cannot be the basis for finding an unfair labor practice.

4.                   Union Proposal: The medical office assis­tant be paid at the same level as the existing office assistant 3.

Employer Response: The employer agreed to review results from a salary survey that was then in process, but did not agree to the union’s proposal.

As with the analysis of the union’s second proposal, the employer had no duty to bargain with this union concerning the “medical office assistant” classification that was not represen­ted by the union. The employer’s refusal to bargain wages of positions not in the union’s bargaining unit was not an unfair labor practice.

5.                   Union Proposal: Employee Marush be automatical­ly placed in the proposed medical office assistant position.

6.                   Union Proposal: Employees Kropf, Tjems­land, Henson and Long be automatically placed in proposed aide positions.

7.                   Union Proposal: Employee Hall remain as an office assistant 2.

Employer Responses: The employer reiter­ated that the reorganization would go forward. It opined that these proposals were more focused on the decision to reorganize than on bargaining the impact of the decision.

In its brief, the employer also asserts that this proposal would have violated the parties’ collective bargaining agreement. It points out that section 12.2 requires that all vacant positions be made available to all health department employees. Therefore, acceptance of the union’s proposal to automatically place the laid off employees into the new positions would have required the negotiation of an exception to the specific contract language. The employer’s initial response was valid, and its additional argument also has merit. The cited contract language is:

12.2      POSTING OF JOB ANNOUNCEMENTS. All regu­lar job announcements shall be posted on the Career Counseling bulletin boards simultaneous with the public announcement of such openings. Job announcements shall be posted for at least five (5) days in advance of the last date for filing applications, or until sufficient numbers of applications have been re­ceived. All announcements for interim job assignments shall first be posted on the Career Counseling bulletin board in Human Resources and on the Human Resource Jobline with an unofficial copy on the Departments’s local area network for five (5) days.Defects in posting an unoffi­cial copy to the local area network shall not be construed to be errors or defi­ciencies under this section. The Depart­ment, in its sole discretion, shall de­termine and establish minimum qualifica­tions and any special requirements for the job and shall include these qualifi­cations and requirem­ents in the job an­nouncement.

. . .

12.5      Promotions, Demotions, and Job Transfers. In addition to any other qualified candi­dates, the Department shall refer to the hiring authority for consideration all employees who satisfy the minimum quali­fications set by the Department to fill any regular or project job vacancy. The Departm­ent shall employ merit principles and shall select candidates for vacancies on the basis of their relative qualifica­tions. In filling job vacancies, the Department may take into consideration such factors as education, experience, aptitude, knowledge, character, physical fitness, the quality and length of em­ployment at the Department, or any other qualifications or attributes which enter into the Department’s determination of the relative qualifications of candi­dates. The Department may also consider veteran’s preference requirements and the Department’s commitment to diversity in the work place. If the department elects not to fill a vacancy at any time after posting has occurred, nothing in this article shall require the Department to fill the vacancy.

(emphasis added).

The union’s proposal would thus have trampled on the right of other bargaining unit employees to have new positions posted and to have their applications considered.

Moreover, the same contract language reaffirms that the parties had already negotiated standards for job transfers. The contract language gives the employer the discretion to determine the requirements of any newly-created positions within the bargaining unit, and to be the sole judge of the qualifications of the employees placed into any such positions, whether by promotion, transfer or hiring. The union’s proposals concerning the specific employees went far beyond what the contract would have provided, and amounted to an attempt to renegotiate the standards already established in the collective bargaining agreement. The charge that the employer refused to bargain based upon its responses to the April 29 proposals must be dismissed.

Transfer of Bargaining Unit Work

The union asserts that the employer action at issue in this case constitutes a transfer or “skimming” of bargaining unit work to the employer’s non-represented employees. In its brief it state­s:

The present case is not a situation where the employer is curtailing the scope of its opera­tions, or where a reduction of staff or of employee work hours is the result of the curtailment of the employer’s operation, a recognized exception to the obligation to bargain collectively.

The facts of this case do not support this assertion.

Rather than a transfer of a particular body of work from bargaining unit employees to other employees, this record describes a change of the body of work to be done. Just as there was no need for registered nurses and counselors in the restructured program, there was no need for the office-clerical support which had been associated with the previous program. It is true that the employer did not entirely “go out of business” as regards services to substance abusers in the community it serves, but this record describes a very definite change of the direction and delivery of its services. This is the kind of entrepreneurial decision contemplated in Fibreboard Paper Products Corp. v. NLRB, supra when it discussed “. . . the basic scope of the enterprise” as a permissive subject of bargaining. The union has not established that it ever had exclusive work jurisdiction over the clinical preparation and patient interaction duties called for by the new program mission and emphasis. Therefore, the employer did not commit an unfair labor practice when it rejected the union’s attempts to negotiate the retention of the office-clerical employees in the new roles and/or to have the historically unrepresented classifications accreted to the bargaining unit.

The union asserts the employer intertwined its decision to change the focus of the substance abuse program with a transfer of bargaining unit work. The problems with that analysis are two-fold:

First, the work that is being alleged to have been transferred is common to many classifications, and was not unique to the office assistant classifications represented by the union. Knowledge of office procedures, typing, using office equipment, transcribing notes, and records keeping, is a skills base shared by many job classifications to one degree or another. Examination of the “health department aide” and “medical office assistant” job descriptions readily discloses that their record-keeping is incidental to hands-on medical procedures such as medical charting, urinalyses observation and packaging, recording vital signs (blood pressure, height and weight), hearing and vision tests, and the sterilizing of medical equipment. Those are responsibilities of a completely different nature than the work of the laid-off office-clerical employees. The union’s characterization of the new positions as essentially clerical in nature ignores the focus of the new positions on medical procedures and patient preparation and care.[4]

Second, the union’s claim that the office assistants were not given the opportunity to obtain the relevant job skills for the new positions is contradicted by the language of the parties’ collec­tive bargaining agreement. The employer was only obligated to consider all employees who made themselves available for the new positions. In fact, the employer did transfer one of the office assistants into one of the medical office assistant positions, but they were not obligated to automatically transfer employees to fill newly created positions with office assistants who did not have the requisite job skills.

Direct Dealing with Employees

The union alleged that the employer circumvented the union by talking directly with bargaining unit employees about the restruc­turing of the substance abuse program. Where public employees have exercised their right to organize and select a labor organization as their exclusive bargaining representative under RCW 41.56.080, the employer is obligated to bargain with that organization to the exclusion of all others and also to the exclusion of direct dealings with employees on matters that are mandatory subjects of collective bargaining. City of Wenatchee, Decision 2216 (PECB, 1985). An employer which circumvents its obligations towards the exclusive bargaining representative commits a violation of RCW 41.56.140(4) (refusal to bargain) and derivatively, of RCW 41.56.140(1) (interference with employee rights).

In this case, the key to analysis is the requirement that the direct dealing concern mandatory subjects of bargaining. The employer did talk to its employees concerning the various plans for reorganizing the department, but that reorganization was not a mandatory subject of bargaining. There was no evidence that the employer attempted to negotiate the wages, hours, or working conditions of the new positions with the existing employees. From the testimony presented, the employer was only informing its employees of changing plans and details of where the program might be heading.

The union was given simultaneous notice of the employer’s plans. Although her recollection concerning conversations which took place in late 1998 and early 1999 was somewhat vague, Novotny testified about conversations she had with Tom Michel and the bargaining unit shop steward at the time, Sandy Chudy. That testimony contradicts the union’s contention that no evidence was presented by the employer that it had brought the proposed privatization to the attention of union representatives, or that no effort was made prior to February of 1999 to notify the union of the planned reorganization. The union’s failure to call Tom Michel as a witness or otherwise rebut Novotny’s testimony leads this Examiner to conclude that the employer had provided notice to the union of its plans, and did not commit an unfair labor practice when it implemented those plans.

Conclusions

The union has not carried its burden of proof that the employer refused to bargain in good faith in either its decision to restructure its substance abuse program or in the manner in which it dealt with bargaining the impacts of the program change. The decision to change the focus of its substance abuse program and the employee qualifications required by that program were permissive subjects of bargaining, as they fundamentally changed the way that the employer was doing business. The impact bargaining which might have been possible in such a situation was largely preempted by extensive language in the parties’ collective bargaining agreement, including management rights, promotions, demotions, transfers, and layoffs. Additionally, when the employer met with the union to bargain any additional impacts, the union sought to bargain the decision and to renegotiate the existing contract provisions. The employer thus fulfilled its bargaining obligation concerning the impacts of its decision to reorganize its methadone program. Seattle School District, Decision 5755‑A (PECB, 1998).

Finally, the union did not carry its burden of proof that the employer circumvented the union when it talked to its employees concerning the proposed restructuring.Evidence was presented that the employer had also engaged in ongoing discussions with union representatives concerning this matter during the last months of 1998 and early in 1999. Furthermore, even if new union representa­tives were not aware of those meetings, the employer’s written notice on April 1, 1999, gave advance notice of layoffs scheduled to take place on July 1, 1999.

FINDINGS OF FACT

1.                  The Tacoma Pierce County Health Department is a public employer within the meaning of 41.56.030 RCW.

2.                  The Washington State Council of County and City Employees, a bargaining representative within the meaning of RCW­ 41.56.030(3­), is the exclusive bargaining representative of certain employees of the Tacoma-Pierce County Health Depart­ment, including office-clerical employees who worked in the employer’s substance abuse program until 1999.

3.                  The employer and the union have had a long standing collective bargaining relationship and have a current collective bargain­ing agreement which includes language addressing management rights, reduction in force, promotion, demotion, and transfer. The contract covers the classification of office assistant that was utilized in the employer’s substance abuse program.

4.                  Since 1993, the employer has been restructuring its programs and services to eliminate direct services to the public, and has preferred to monitor or regulate programs operated by private providers. The union was involved in changes to other department programs which were implemented previous to 1998.Discussions about modifying the employer’s substance abuse/me­thadone program had been ongoing since 1993.

5.                  In 1998, the employer was working on a plan to transition the substance abuse/methadone program to a private provider with a target date of July 1, 1999.

6.                  By January 1999, it was decided that because of license requirements, the substance abuse program could not be provided by a private company. The employer then decided to change the focus of the program from a counseling model designed to eliminate drug abuse to a self sustaining medical model designed to assist addicts to become functional.

7.                  Tom Michel, the union’s business agent, Sandy Chudy, the union shop steward, and Dorene Novotny, the employer’s human resources director, met regularly during 1998 and early 1999 to discuss the program changes.

8.                  Under the medical model, physicians, licensed practical nurses, medical office assistants and health department aides were utilized. The employer had no ongoing need for the registered nurses, counselors and office assistants who had been employed in the previous program. The health department aide and medical office assistant classifications had been used elsewhere in the employer’s operations, and are non-represented employees.

9.                  In March of 1999, Bill Keenan replaced Tom Michel as the union representative, and Vivienne Kamphaus replaced Dorene Novotny as the employer’s human resources director. At some unspeci­fied time, Lester Davis replaced Sandy Chute as the union shop steward.

10.              On March 17, 1999, the substance abuse program director sent a memo to the staff outlining the new program and the impend­ing changes in the staff configurations.

11.              On March 26, 1999, Keenan wrote the employer and demanded to bargain the planned reorganization of the substance abuse program and the impact of that reorganization on the members of the bargaining unit.

12.              On April 7, 1999, Kamphaus replied to the union with specifics as to how the employer was effectuating the reorganization. She listed five office assistants that would be laid off and one office assistant that would exercise seniority rights and “bump” into a remaining position. She agreed to meet with the union to negotiate the impacts of the proposed reorganization and listed times and dates when she and the employer’s attorney could be available to meet.

13.              The parties met on April 29, 1999. The union presented a seven point proposal. Some of its proposals would have maintained all the office assistants as employees; some of its proposals would have placed all the office assistants in the new health department aide and medical office assistant positions; and one of its proposals would have accreted the health department aide and medical office assistant classifi­cations, which are unorganized, into the union’s bargaining unit. The employer did not reply to the proposals at the meeting.

14.              On May 3, 1999, the employer replied in writing to the union’s proposals. It refused to bargain the decision to reorganize the substance abuse program and it rejected the remainder of the union’s proposals. It stated that the issue of union representation should be referred to the Public Employment Relations Commission.

15.              Keenan replied in a phone message in which he stated that he was cutting off bargaining on this issue and was filing an unfair labor practice charge.

CONCLUSIONS OF LAW

1.                  The Public Employment Relations Commission has jurisdiction in this matter pursuant to Chapter 41.56 RCW.

2.                  The employer did not commit an unfair labor practice within the meaning of RCW 41.56.140(4) when it reorganized its substance abuse program without bargaining that decision with the union.

3.                  The employer did not commit an unfair labor practice within the meaning of RCW 41.56.140(4) when, as a part of the above referenced reorganization, and, following the procedures spelled out in the parties’ collective bargaining agreement, ­it laid off the employees in its substance abuse program classified as office clerical employees.

4.                  The employer did not commit an unfair labor practice within the meaning of RCW 41.56.140(4) when it met with the union to negotiate proposals concerning the impact of the reorganiza­tion and layoffs, but did not agree to any of the union’s proposals as the union’s proposals covered either permissive subjects of bargaining or were preempted by specific language in the parties’ collective bargaining agreement.

5.                  The employer did not commit an unfair labor practice within the meaning of RCW 41.56.120(2) when it met with employees concerning several reorganization plans as the subjects of discussion were permissive subjects of bargaining. Further­more, eviden­ce was also presented which showed that the employer met with union representatives during this time period and had informed them of the reorganization plans being considered.

ORDER

Based upon the foregoing and the record as a whole, it is ordered that the complaint of unfair labor practices, as charged in the above-entitled action, is hereby DISMISSED.

Issued at Olympia, Washington, on the 26^th day of April, 2001.

PUBLIC EMPLOYMENT RELATIONS COMMISSION

[SIGNED]

WALTER M. STUTEVILLE, Examiner

This order will be the final order of the agency unless appealed by filing a petition for review with the Commission pursuant to WAC 391-45-350.