By Andrew B. F. Carnabuci

In the recently released case of Town of Middlebury v. Fraternal Order of Police, Middlebury Lodge No. 34 Et Al. (SC 20733), the Connecticut Supreme Court affirmed a ruling originating from the State Board of Labor Relations (hereafter “SBLR”) that the standard for a union waiving its right to bargain upon an employment condition that is otherwise subject to mandatory bargaining remains “clear and unmistakable” waiver, a recent decision of the National Labor Relations Board (hereafter “NLRB”) to the contrary notwithstanding.

The dispute involves the Town's decision to unilaterally change the way union member's extra duty pay was used to compute pension benefits.

The SBLR had initially held that by unilaterally changing its past practice of including extra duty pay in the calculation of pension benefits, the Town of Middlebury had violated the Municipal Employee Relations Act (Conn. Gen. Stat. § 7-467 et seq.; hereafter “MERA”).  The Board concluded that the Town's change to not include extra duty pay in pension benefit calculations violated its duty to bargain in good faith, as articulated in MERA, Conn. Gen. Stat. ¶7-470(a)(4), because the union relied on the Town's past practices and had not waived its right to bargain over the issue.  The Board held that any such waiver by a union of the right to bargain on an employment condition that is otherwise subject to mandatory collective bargaining must be “clear and unmistakable,” but that the union made no such clear and unmistakable waiver in this case.

The Town brought an administrative appeal in Superior Court.  During the pendency of the administrative appeal, the NLRB issued its decision in the case of MV Transportation, Inc. (368 N.L.R.B. No. 66), in which the NLRB abandoned the previous “clear and unmistakable” federal standard for union waiver of bargaining rights, and adopted a “contract coverage” standard, which is a lower standard, meaning that the NLRB made it easier for unions covered by the National Labor Relations Act (hereafter “NLRA”) to waive the right to bargain over issues that would otherwise be subject to mandatory bargaining.  Moreover, the NLRB held that this new standard for waiver applies retroactively, to pending cases brought under the “clear and unmistakable” standard.

The Superior Court hearing the administrative appeal of the instant matter, in light of the NLRB's decision, remanded to the SBLR to consider whether it wished to follow the NLRB and adopt the lower “contract coverage” standard for waiver by unions under its jurisdiction.  The SBLR declined to adopt the “contract coverage” standard, and the Superior Court therefore dismissed the Town's administrative appeal, as there was no evidence of arbitrariness, illegality or abuse of discretion in the SBLR's original determination that the Town violated its duty to bargain in good faith with the union over the impact of extra duty pay on pension benefit calculations.

On appeal, the Appellate Court held that, although the SBLR often looks to the federal NLRB and its decisions for guidance on Connecticut labor law, NLRB decisions are not binding on the SBLR, and it was within the scope of its legitimate authority when it rejected the “contract coverage” standard of the NLRB.  Moreover, because the SBLR is a state agency charged with enforcing MERA, its policy decisions interpreting MERA were entitled to judicial deference.  The Town appealed to the Supreme Court.

The Supreme Court affirmed the Appellate Court's ruling that the SBLR was entitled to interpret MERA to require a “clear and unmistakable” standard, the NLRB's decision notwithstanding.  It additionally held that even if the SBLR had adopted the NLRB's “contract coverage” standard, the NLRB has nevertheless limited that lower standard for waiver to cases involving active collective bargaining agreements (hereafter “CBAs”), and it was undisputed that the CBA in the instant matter had expired prior to the Town's unilateral redetermination regarding extra duty pay in pension calculations.

The Supreme Court began by noting that judicial review of state agency decisions interpreting a statute the agency is charged with enforcing is narrow, and limited to administrative appeals taken pursuant to the Uniform Administrative Procedures Act (hereafter “UAPA”).  Consequently, the courts will only disturb the decisions of the SBLR interpreting MERA when there has been a showing that the agency acted “unreasonably, arbitrarily, illegally, or in abuse of its discretion.”  The Supreme Court rejected the Town's claim that the SBLR's decision met that high standard.

The Supreme Court also noted that although the SBLR often looks to decisions of the federal NLRB to guide its own decisions, this does not mean that NLRB decisions are binding on SBLR.  The court held that the SBLR was well within its discretion to maintain the same standard for waiver that it has used for the last 50 years.  The court also rejected the Town's argument that such a standard is practically unworkable, also on the basis that it has been the standard for the last 50 years, without issue.

The Supreme Court affirmed, as there was no error.

This decision is of particular importance to municipal employers, who should take caution that even though the NLRB has relaxed the waiver standard for unions under the jurisdiction of the NLRA and NLRB, the SBLR has retained the much higher standard for union waiver of the right to bargain over employment conditions.  If in doubt, it is always prudent to consult with seasoned labor and employment counsel before making any unilateral change to employment conditions for employees subject to a CBA, even in cases where a union appears to have waived its bargaining rights.  The labor and employment lawyers at Rose Kallor are always available to assist you; we can be reached at 860.361.7999 or at www.rosekallor.com.