STATE OF WASHINGTON BEFORE THE PUBLIC EMPLOYMENT RELATIONS COMMISSION
SERVICE EMPLOYEES INTERNATIONAL UNION, LOCAL NO. 120,
Complainant,	CASE NO. 2072-U-79-290
vs.	DECISION NO. 844-PECB
PORT OF EDMONDS,
	DECISION AND ORDER
Respondent.

Michael McGrorey, research director, appeared on behalf of the complainant.

Richard Cole, attorney at law, appeared on behalf of the respondent.

Upon a charge filed by the Service Employees International Union, Local 120 (the union), a hearing was held on September 13 and 14, 1979. The issue presented is whether the Port of Edmonds (the port) refused to engage in collective bargaining with the union in violation of RCW 41.56.150(1) and (4) of the Public Employees Collective Bargaining Act (the act). More specifically, the union alleged that the port unlawfully refused to bargain over the decision to lease out its service operations at the port which resulted in the layoff of employees represented by the union.

THE ALLEGED UNFAIR LABOR PRACTICES

Pursuant to RCW 53.04.010, port districts are authorized to be established “for the purposes of acquisition, construction, maintenance, operation, development and regulation within the district of harbor improvements, …water transfer and terminal facilities…and other commercial transportation, transfer, handling, storage and terminal facilities, and industrial improvements.”

The port owns property on the waterfront in Edmonds. Since 1962 the port has rented out moorage space and dry storage sheds for pleasure boats. It also maintained a boat launching facility, a fuel dock, and parking lots. Over the years the port has leased out much of its property to various small businesses, such as a boat sales company, a boat repair shop, a boat construction company, a crab trap builder, and an asphalt paving company.

Following an election, the union was certified as the bargaining representative of the employees of the port in May, 1977. In July, 1978, after negotiations for an initial bargaining agreement broke down, the union struck the port. Prior to the strike the port employed about 10 to 12 employees who were represented by the union. It is not clear from the testimony precisely how many employees represented by the union chose to work during the strike. It is also not clear whether the port hired any replacements. The strike ended in August of 1978, when the parties reached What appeared to be an agreement. Following the strike some employees returned to work and others chose not to. Again the pre-cise numbers are not clear from the record.[1] The union had been bargaining for separate contracts for the security and non-security personnel. During the strike the port arranged with the City of Edmonds for security services. This arrangement continued after the strike and the two security employees represented by the union were not retained.

The agreement that ended the strike was never executed. The port prepared the draft of the contract. The union objected to certain provisions contained within the draft, alleging that they did not reflect the true agreement. Negotiations continued until December, 1978. There is no dispute that one provision of the contract would have authorized the port to contract out services, while also providing for 60 days notice to employees who would be terminated as a result of the contracting out.

On December 6, 1978, an employee of the port filed a decertification petition with the Public Employment Relations Commission. Shortly thereafter the negotiator for the port contacted PERC by phone and informally inquired of a PERC representative whether it was appropriate for the port to continue to bargain while the decertification petition was pending. The port negotiator testified that he was informed that “normally” it was not considered appropriate to continue bargaining during the pendency of a question concerning representation because such negotiations may turn out to be “a waste of time”. The port then notified the union in writing that it was suspending negotiations as a result of advice it had received from PERC. The union did not respond to that letter. No further negotiations concerning a new contract were held.

Over the years on several occasions individuals offered to lease from the port the fuel dock, moorage facilities, and launching facilities. The port declined such offers until 1978. In November, 1978, the port began to consider such a leasing arrangement in earnest. The port commission, having decided that a lease arrangement would provide a better quality of service, decided in early 1979 to lease out its port facilities. A lessee, Charles W. King, took over the port operations on May 1, 1979. It is not contended that the lease out arrangement resulted from anti-union animus.

The lease of the premises and facilities was for a term of five years. The parties agreed to renegotiate the lessee's rent each year and the lease was terminable annually by either party. The lessee agreed to provide the same services, at the same rates, during the same hours, as those provided by the port.

As a result of the leasing out of the port operations, all but two members of the bargaining unit were laid off. On April 13, 1979, Ralph Richardson, secretary-treasurer of the union, was informed by one of the employees of the port that the facilities were to be leased out. On April 17, 1979, Richardson inquired in writing of the port attorney as to the situation. By letter dated April 23, 1979, Richard Cole, the port attorney, informed Richardson that the port did intend to lease out the facilities on May 1, 1979. On April 27, 1979, the union sent a mailgram to Gordon Maxwell, chairman of the port commission, requesting that the port rescind its lease out arrangement and bargain concerning the decision and the effects of the decision. No negotiations resulted.

POSITIONS OF THE PARTIES

The union asserts that the port unlawfully failed to notify the union and bargain with it concerning the port's decision to lease its facilities prior to the layoff of the majority of the bargaining unit employees and failed to bargain concerning the impact of that decision.

The port argues that the commission lacks jurisdiction to resolve unfair labor practice complaints involving ports, that the port's decision to lease its operations is not a bargainable issue, and that the port was justified in refusing to bargain with the union during the pendency of a decertification petition, particularly in view of advice given to it by a commission agent.

DISCUSSION

A. Jurisdiction

The Public Employees Collective Bargaining Act, Chapter 41.56 RCW, provides in part:

41.56.010 Declaration of purpose. The intent and purpose of this chapter is to promote the continued improvement of the relationship between public employers and their employees by providing a uniform basis for implementing the right of public employees to join labor organizations of their own choosing and to be represented by such organizations in matters concerning their employment relations with public employers.

41.56.020 Application of chapter. This chapter shall apply to any county or municipal corporation, or any political subdivisions of the state of Washington except as otherwise provided by … chapter 53.18 RCW.

41.56.030 Definitions. 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.

41.56.140 Unfair labor practices for public employer enumerated. It shall be an unfair labor practice for a public employer:

(1) To interfere with, restrain, or coerce public employees in the exercise of their rights guaranteed by this chapter;

...

(4) To refuse to engage in collective bargaining.

...

41.56.160 Commission to prevent unfair labor practices and issue remedial orders. The commission is empowered and directed to prevent any unfair labor practice and to issue appropriate remedial orders. This power shall not be affected or impaired by any means of adjustment, mediation or conciliation in labor disputes that have been or may hereafter be established by law.

Chapter 53.18 RCW provided that port districts may enter into labor agreements “with employee organizations on matters of employment relations…“[2], and places certain restrictions on what may or may not be included in such a labor agreement.[3] Port employees are also given the right of self-organization and PERC is designated to resolve controversies as to the employee’s choice of a labor organization. ^[4]Chapter 53.18 neither includes any provisions specifically relating to unfair labor practices, nor makes reference to Chapter 41.56 RCW.

In Port of Seattle, Decision 599-A PECB (1979), PERC held that both Chapter 41.56 RCW and Chapter 53.18 RCW apply to port employees. It noted that RCW 41.56.020 gives port employees the rights and protection outlined in Chapter 41.56 RCW, “except as otherwise provided in … Chapter 53.18 RCW”. The Commission reasoned:

RCW 41.56 contains a broader range of rights and obligations than RCW 53.18. Specifically, RCW 41.56 provides for the definition and prevention of unfair labor practices. There is nothing in RCW 53.18 which provides otherwise.

More specifically, in Port of Seattle, the Commission decided that it does have jurisdiction over a refusal to bargain unfair labor practice charge. That holding is dispositive of the port’s contention that collective bargaining is discretionary rather than mandatory for port districts.

I am bound by this Commission precedent to hold that PERC does have jurisdiction in this case. The port’s arguments in this regard should be made, if at all, to the Commission on appeal.

The port also argues that the union is collaterally estopped from raising the issue of the applicability of RCW 41.56 to the Port of Edmonds. It points out that the union failed to appeal the director’s decision in Port of Edmonds, Decision No. 378-PORT (1978), where the director dismissed unfair labor practice charges brought by this same union, for lack of jurisdiction. That decision was rejected by the Commission in the later Port of Seattle case. The case at hand involves an entirely different set of circumstances from that raised in the previous Port of Edmonds case. Many reasons could have caused the union to not appeal the previous Port of Edmonds case to the Commission. By failing to make such an appeal, the union cannot be found to have abandoned its claim for all time and for all circumstances that PERC does have unfair labor practice jurisdiction with regard to port districts.

B. Unilateral Contracting Out

The port’s decision to lease certain of its operations was in essence a contracting out of services with the result that bargaining unit personnel were laid off. Relying on U.S. Supreme Court and NLRB precedent, PERC held in City of Kennewick, Decision No. 482-B PECB (1980), that the decision to contract out work which had been done by bargaining unit employees is a mandatory subject of bargaining.[5] PERC held that the City of Kennewick unlawfully refused to bargain when it contracted out custodial work which previously had been performed by bargaining unit personnel, “without first advising the bargaining representative of its intention and giving that representative a chance to request bargaining about it before presenting the bargaining representative with the accomplished act.” PERC’s decision in City of Kennewick was based on Chapter 41.56 RCW, and more specifically on the definition of collective bargaining contained in RCW 41.56.030(4) which requires bargaining on “personnel matters, including wages, hours and working conditions”. That definition of bargainable matters is not materially different than that contained in RCW 53.18.010 and .020 which authorizes ports to enter into labor agreements “on matters of employment relations” which “includes, but is not limited to, matters concerning wages, salaries, hours, vacation, sick leave, holiday pay and grievance procedures”. (Emphasis supplied). In Fibreboard, the U.S. Supreme Court interpreted the National Labor Relations Act, which covers labor relations in the private sector and requires bargaining “with respect to wages, hours, and other terms and conditions of employment”, to:

cover termination of employment, which as the facts of this case indicate, necessarily results from the contracting out of work performed by members of the established bargaining unit.[6] (Emphasis supplied)

The court held that the decision to contract out is bargainable, reasoning that unions have a legitimate interest in preserving the work its members had historically performed[7], and also observed that contracting out provisions are not uncommon in collective bargaining agreements. For these reasons, I disagree with the port’s argument that it is not empowered to bargain its decision to lease a part of its operations since that decision is not within the definition of employment relations.

I also disagree with the port’s argument that by bargaining its decision to lease its facilities, it would violate its exclusive duty to manage its property. The Washington legislature has curbed the public employer’s absolute freedom to manage their enterprise in order to further labor tranquility and to provide collective bargaining rights to eMployees.[8]

Further, the requirement of collective bargaining does not, as the port argues, require it to enter into subcontracting arrangements on terms imposed by PERC or a bargaining representative. The requirement to negotiate in good faith is not a requirement to agree, but rather:

to engage in a full and frank discussion with the collective bargaining representative in which a bona fide effort will be made to explore possible alternatives, if any, that may achieve a mutually satisfactory accommodation of the interests of both the employer and the employees. If such efforts fail, the employer is free to make and effectuate his decision.[9]

Good faith negotiations between the port and the union may have convinced the port to forego its decision to contract out. The union may have persuaded the port that new operating procedures or economic concessions by the employees or problems in the new arrangement, would make continued port operation of the facilities preferable for the port.

Further, the port unlawfully refused to bargain concerning the impact of its decision to contract out operations, which may well have involved such mandatory subjects of bargaining as severance pay and the order of layoff.[10]

The port implies that the union waived its right to bargain concerning contracting out during negotiations. Statutory bargaining rights may be waived, if made knowingly.[11] The union’s arguable waiver was not effectuated since the contract was never consummated. This was recognized by the port, as evidenced by its failure to give the union 60 days notice of its intended action as required by the tentative agreement.

C. Good Faith Doubt of Majority Status

In Celanese Corporation of America[12], the NLRB set out its standards by which to judge whether an employer’s withdrawal of recognition from an incumbent union is permissable. A certified union is presumed, absent unusual circumstances, to maintain majority status for one year from the date of certification and during the life of any contract agreed to. These presumptions in the private sector, are reflected in RCW 41.56.070 which provides that:

“…No question concerning representation may be raised within one year of a certification or attempted certification. Where there is a valid collective bargaining agreement in effect, no question of representation may be raised except during the period not more than ninety nor less than sixty days prior to the expiration date of the agreement.”

As stated in Celanese, at the expiration of either the one year period following certification or of the collective bargaining agreement, the union enjoys a rebuttable presumption that its majority status continues. These presumptions are rebuttable by evidence establishing that the union has lost its majority status. According to Celanese, they may also be rebutted by a showing that the employer had a good faith doubt that the union maintained its majority status. This asserted doubt must be based on objective considerations and be raised in a context free of unfair labor practices. A good faith doubt must rest on more than unfounded speculation or a subjective state of mind, but less than conclusive proof.[13]

The port raised eight factors in support of its contention that it had a good faith doubt that the union represented a majority of the employees. It relies on 1) the filing of the decertification petition, 2) the representation of the employee filing the petition that it was supported by a majority of the employees in the bargaining unit, 3) the advice of an employee of PERC that it would be prudent to discontinue negotiations until the petition was resolved, 4) the reduction in the size of the bargaining unit from 11 to 7, 5) employee turnover, 6) a change in duties for one employee, 7) the approximately 19 months that had elapsed since the certification without a contract being entered into, and 8) a strike that had taken place in which not all employees in the bargaining unit had participated.

The port cites Telautograph Corporation[14], where the NLRB held that an employer may not bargain with an incumbent union until the question concerning representation arising from a decertification petition has been resolved. The Board’s rationale was supported by a 3 – 2 vote of its members. Whereas the two dissenting members, Fanning and Jenkins, are still members, recent turnover among the others indicate that there is some question as to whether that decision will continue to reflect NLRB policy.

There appear to be two justifications for the NLRB’s Telautograph decision. One would be that the filing of a decertification petition would establish per se that the employer has a good faith doubt regarding the majority status of the union. In this regard, a valid decertification petition filed with PERC must be accompanied by a showing of interest that at least 30% of the bargaining unit desires such an election.[15] The employer is not informed by PERC how large the showing of interest is. Thus, the filing of a decertification petition in itself would not indicate to the port that the union has lost its majority support, and would not justify a refusal to bargain on that basis.

The second basis for the Telautograph decision is reflected in its reliance on Shea Chemical Corporation[16], which held that an employer may not bargain with an incumbent union when a rival union has filed a representation petition. The theory behind the Shea case would appear to be to protect the employees in that the employer should not give unfair assistance to one of two competing unions. However, the NLRB in Shea also noted that the incumbent union cannot be ignored entirely by the employer while a question concerning representation is pending. It said that the employer, for instance, must not refuse to permit the incumbent union to administer its contract or process grievances.

It cannot be argued that where there is a pending decertification petition, employees need to be protected from employer contact with the incumbent union concerning the employer’s decision to contract out services resulting in the termination of the majority of employees in the bargaining unit. In such a situation, the employees are in dire need of the services of their bargaining representative and the employer should be required to bargain the decision and the effects of the decision, unless it has convincing external evidence that the union has lost its majority status. This requirement would best serve the stated purpose of the Public Employees Collective Bargaining Act contained in RCW 41.56.010 to protect the right of employees to be represented by labor organizations in matters concerning their employment relations with public employees.[17]

Contrary to the port’s assertion in its brief, there is nothing in the record which indicates that an employee informed a port representative that the decertification petition was supported by a majority of the employees.

Informal advice given by a PERC representative over the telephone can not be the basis for establishing that the port had an objective basis for doubting the union’s majority status. It is not uncommon to run afoul of the law by relying on incorrect advice or advice based on incorrect or incomplete assumptions. Nevertheless, ignorance of the law is no excuse for the commission of illegal acts, particularly where the victim of such acts stands to benefit by a remedial order.

No testimony was offered concerning employee turnover or changes in duties. The fact that the size of the bargaining unit was reduced by three or four since the time of certification does not reflect a loss of majority support for the union.

While the union bargained unsuccessfully for a contract for a lengthy period, this is not indicative of a loss of majority support. While there was evidence that several employees continued to work during the strike, there was no evidence presented that a majority of the employees refused to strike, that any replacements were hired, or even that a picket line was established that the employees who continued to work refused to honor. The strike was terminated by a tentative agreement between the parties. Further, for months after the strike ended, the port continued to bargain with the union for a new contract.

In sum, the record reveals that the port had a reasonable basis to believe that 30%, not 50%, of the bargaining unit no longer supported the union. I thus conclude that the port refused to bargain with the union concerning its decision to contract out services and the effects of that decision, at a time when the employer did not have a good faith doubt as to the union’s majority status.[18]

THE REMEDY

Having found that the port committed an unfair labor practice as alleged in the complaint, it must be ordered to cease and desist from violation of the Act and to take certain affirmative action designed to restore the status quo ante and to effectuate the policies of the Act.

Restoration of the status quo requires that the port terminate its lease arrangement with Charles W. King, that the discharged employees be returned to their former positions, that they be made whole for loss of earnings from the date of their discharge to the date they are offered reinstatement, and that the port bargain in good faith before it implements an intended change in conditions of employment.[19]

The union contends that the pending decertification petition should be dismissed. This remedy would have been more appropriate if the port rather than the employees had filed the petition. However, the rights of employees to choose not to be represented must be considered in fashioning a remedy. The proven unfair labor practices were not proven to be the result of anti-union animus and were not so egregious to preclude the holding of an election once the port complies with this order.

FINDINGS OF FACT

1.         The Port of Edmonds is a “port district” within the meaning of RCW 53.18.010, and is a “public employer” within the meaning of RCW 41.56.030(1).

2.         Service Employees International Union, Local No. 120, is an “employee organization” within the meaning of RCW 53.18.010 and is a “bargaining representative” within the meaning of RCW 41.56.030(3). It is the certified bargaining representative of the port’s employees.

3.         Negotiations with the union for an initial collective bargaining agreement were suspended by the port upon the filing by an employee of a decertification petition with PERC in December, 1978.

4.         In early 1978, the port elected to contract out certain port operations, effective May 1, 1978.

5.         Previous to May 1, 1978, the port operations were performed by members of the union’s bargaining unit.

6.         As a result of the contracting out of port operations, a majority of the employees in the bargaining unit represented by the union were laid off.

7.         The port did not notify the union of the proposed change, until the union inquired in April, 1978.

8.         In April, 1978, the union requested that the subcontracting arrangement be rescinded, and that the union be given an opportunity to bargain with the port concerning the decision to contract out, and the effects of that decision on the employees.

9.         The port did not offer to negotiate the matter with the union.

10.       The union never unequivocally waived its right to bargain on these matters.

11.       At the time in question, the port did not have convincing evidence that the union no longer represented a majority of the employees in the bargaining unit.

CONCLUSIONS OF LAW

1.         The Public Employment Relations Commission has jurisdiction over this matter pursuant to RCW 41.56.160.

2.         By the event described in findings of facts 3 through 11, the port committed unfair labor practices violative of RCW 41.56. 140(1) and (4).

ORDER

The Port of Edmonds, its officers and agents, shall immediately:

1.         Cease and desist from:

(a)        Refusing to bargain collectively with Service Employees International Union, Local No. 120, concerning its decision to contract out the operations of the port, and concerning the effects of that decision.

(b)        Contracting out the work of bargaining unit positions without first giving notice to and bargaining with Service Employees International Union, Local No. 120.

2.         Take the following affirmative action designed to effectuate the policies of the act:

(a)        Terminate the contract with Charles W. King for the performance of port operations formerly performed by bargaining unit employees, and restore all bargaining unit positions whose work has been improperly contracted out.

(b)        Notify the union, in advance, of any intended decision to contract out unit work which would result in the termination of unit personnel.

(c)        Upon request by the union, bargain collectively in good faith with the union as the exclusive representative of the port’s employees in the bargaining unit, with respect to any decision to contract out unit work resulting in the termination of unit personnel, and with respect to the effects of that decision on the bargaining unit employees.

(d)       Post, in conspicuous places on the employer’s premises where notices to all employees are usually posted, copies of the notice attached hereto and marked “Appendix A”. Such notices shall, after being duly signed by an authorized representative of the Port of Edmonds, be and remain posted for sixty (60) days. Reasonable steps shall be taken by the Port of Edmonds to ensure that said notices are not removed, altered, defaced or covered by other material.

(e)        Notify the Executive Director of the Commission, in writing, within twenty (20) days following the date of this Order, as to what steps have been taken to comply herewith, and at the same time provide the Executive Director with a signed copy of the notice posted in accordance with this Order.

DATED this 7^th day of April, 1980.

PUBLIC EMPLOYMENT RELATIONS COMMISSION

[SIGNED]

ALAN R. KREBS, Examiner