Legislature(1997 - 1998)
03/11/1997 08:04 AM House STA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 124 - PERA: LOCAL EXEMPTION/NONNEGOTIABLE ITEMS The next order of business to come before the House State Affairs Standing Committee was HB 124, "An Act relating to items not subject to collective bargaining and to application of the Public Employment Relations Act to municipalities and other political subdivisions." CHAIR JAMES called on Representative Al Vezey, sponsor of HB 124, to present the bill. Number 2422 REPRESENTATIVE VEZEY explained HB 124 did two things. First, it added to existing state statute a list of the items that were not subject to negotiations during the collective bargaining process under the Public Employees Relations Act (PERA). The items were subject to state privatizing or contracting out for services. Second, it allowed for the political subdivision of the state to get into PERA, but once in, it did not allow for it to get out. "I think that is an affront to the democratic process. This bill merely clarifies that through the democratic process, political subdivisions can by vote decide to be in PERA or they can decide to be out of PERA." There were hundreds of methods of employee management and relations, and PERA was only one of those. The bill mandated to a few municipalities, a distinct minority in the state, that they had to stay under PERA when other communities that were not subject to PERA had more flexibility in regards to their management of their employee relations. TAPE 97-24, SIDE B Number 0006 ED FLANAGAN, Deputy Commissioner, Office of the Commissioner Department of Labor, was the first person to testify in Juneau. The Public Employees Relations Act was in Title 23, the Department of Labor statute. It was administered for the state by the Alaska Labor Relations Agency. The department was opposed to the bill because it potentially denied the right of collective bargaining currently covered under the act. It had been portrayed as leveling the playing field. The department, however, believed that it "blew up and obliterated the playing field," because employees that were currently organized in unions would potentially loose that right. The method of choice for municipalities that opted out of PERA or that did not recognize bargaining was no labor relations management. MR. FLANAGAN further stated that the issue of local control was adequately addressed in the statute which provided for legislative approval for money. The department also believed that the subcontracting provision would have a chilling effect on meaningful negotiations of any public employer. The law worked as it stood now. And, municipalities going in and out of PERA would create mayhem and disturb a rather orderly system. Number 0140 REPRESENTATIVE DYSON asked Mr. Flanagan if the contracting out was negotiated under present law? Number 0156 MR. FLANAGAN replied it was provided for in the collective bargaining agreement. There were agreements that were silent to subcontracting. Most, however, required a feasibility study and a cost effectiveness study to show a savings before it could be done. Furthermore, there was only a requirement to bargain at the table, not a requirement to agree to any particular term or even to include that language. It was part of the whole mix of issue that were negotiated. Number 0194 REPRESENTATIVE DYSON stated that a political subdivision could find itself in the position of balancing its best delivery of service for the public and taking into account its responsibility of the present employees under the contract. From a public policy perspective, he asked Mr. Flanagan, what restrictions should be put on a political subdivision when it was trying to find the best way to deliver services to the public? Number 0226 MR. FLANAGAN replied it honored what ever commitments that it had made in the form of a contractual relationship with the employees in a collective bargaining agreement. If there was no language, then it was whatever the public or the legislative body felt was fair treatment. Number 0242 REPRESENTATIVE DYSON agreed that we needed to stick by our commitments. He asked Mr. Flanagan if a political subdivision in the state was absolutely free to contract out for the next cycle of services that were formally done by public employees under a labor agreement? Number 0264 MR. FLANAGAN replied that would depend on the outcome of the negotiations for the new contract. Number 0284 REPRESENTATIVE DYSON wondered if, at the end of a contractual period, under present state law, there was an obligation to do any negotiating. If a political subdivision decided that it wanted to eliminate doing this with public employees and wanted to contract it out, could it not just announce that decision, and not have to begin a new contract? Number 0309 MR. FLANAGAN replied not until a new contract was negotiated. In most contracts, there was a duty to bargain for a successor agreement, or a lack there of. There was a transition period that would have to be undertaken. It would depend on the existing contractual language in regards to its own expiration. Number 0328 CHAIR JAMES stated that she generally supported people forming a union to negotiate the way that they were treated in the work place. In the private sector, she also supported the ability to negotiate wages and benefits. In the public sector, however, she found union negotiations troubling; because, generally the negotiations were done with the Administration or the authorized employees and the workers, followed with the approval by the elected council and then the public, who ultimately were the employers. "This is a government where all the government is a people's government. And, we're all participants." Public employee unions was that it was set up to be conflictive and to not run smoothly. The reason for bargaining was to make things run better; or, in other words, an agreement between those who work and those who tell the people what to do. In addition, the public was on the non-union side rather than on the union side, nationally. Trade union membership had declined and most of the union members were public employees, nationally. She also believed that a deal made was a deal made, and that the rules should not change in the middle of a game. However, economics changed and many times the unions were unbending, especially in small communities. If one agreed that the public ran the system, then why should they not have the ability to say, "we don't want to do this anymore?" Number 0453 MR. FLANAGAN responded he was aware that some differentiated between public and private employees. The department believed that when it came to the basic issue of the right to organize, it did not differentiate because, "a worker is a worker is a worker." A worker should have the basic right to join collectively for a collective voice and for strength in numbers to negotiate with his or her employer. Chair James was correct, nationally, the growth had been greater in the public sector rather than the private sector in unionization. The large majority of union members were still in the private sector; however, at least two-thirds. The local electorate had its voice in the municipal or state election that elected the representatives who exercised the statutory authority under PERA to approve or to reject the monetary terms of an agreement. It also elected, in most cases, the principle executive officer charged with negotiating the agreement. The general climate or tenor of the public sector labor relations in the state was open to question as to how much discord there was out there. It was a fact throughout history that a strike, a protracted impasse, a mediation, or an arbitration decision received headline news. An agreement that was negotiated relatively quickly and quietly and passed without controversy received no ink. In addition, there were numerous examples of when public employees threw their bargaining agent a half-step forward. He cited the city of Fairbanks when the employees froze their agreement and deferred a raise for three to four years in 1986. They system worked pretty well. The Alaska Labor Relations Agency had done a lot to try to encourage mediation rather than strikes. Number 0654 CHAIR JAMES agreed that there were some that worked good and some that did not work good. She had seen both and she was familiar with the trials in the Fairbanks area. When the economy was down and wages were stuck at a certain place, that was when it got even more controversial because the people who were paying the bills for the public employees were not making nearly as much so they didn't want to pay anymore. The city of North Pole opted not to participate in PERA and they got along real well. "In fact, I think they're very, very effective and a very good operation in the city of North Pole." She felt it would be pretty binding for smaller communities, however. They could opt for PERA when a plant was in town, for example, and when the plant moved out, what did the communities do then? Number 0740 MR. FLANAGAN said there had been organizing attempts in North Pole when things probably were not going so well. "Nobody's saying all employees should be in a union. What we're saying is they should have that right, should they choose, to petition for and then get an election." And, because North Pole opted out at that time, the employees did not have that recourse. It was a difference of philosophy. It was unfortunate when a plant moved out of town, for example, but it did not give any employer the right to unilaterally say it was a problem and do away with a collective bargaining agreement. Number 0786 CHAIR JAMES asked Mr. Flanagan who should make the decision that they had a right? Was it an inherent, state statute, or public right to make that decision? Number 0805 MR. FLANAGAN replied the legislature in 1972 found that the employees should have the right to make that decision. A floor amendment allowed for the "opt-out" exemption. That was the determining factor. State law still said that employees should have the right to bargain. However, in this situation employers had the chance to opt out, of which, some have exercised that right. The department believed that employees should have the right to organize, and once it was granted it was meaningless if it could be taken away. Number 0847 REPRESENTATIVE DYSON stated that the public could, once and for all, do away with a right that they once held. The public, once they have entered into a public employee union agreement, could never go back to where they were. Number 0888 MR. FLANAGAN replied, "Yes." Number 0893 REPRESENTATIVE BERKOWITZ asked Mr. Flanagan if there was anything that would prevent a re-negotiation in the middle of a contract? Number 0910 MR. FLANAGAN replied there was nothing to prevent that. The act would be silent. Most contracts allowed for - by mutual agreement - for a revisiting or a reopening. The example he cited earlier from the city of Fairbanks was exactly that. The contract was in effect for three years with two annual raises which were deferred for a number of years extending the contract and saving the employer a great deal of money. Letter-of-agreements were common in both state and political subdivision agreements for mid-term amendments to the contract. Number 0953 REPRESENTATIVE BERKOWITZ asked Mr. Flanagan if Sec. 2 in the bill would allow political subdivisions to treat their unions differently than private organizations? Number 0964 MR. FLANAGAN replied, "Yes." A private sector employer was always covered by the National Labor Relations Act; and, therefore, subject to organizing under the act by their employees. Employers became non-union because the employees at some point decided to de- certify the union. Private sector employers did not come in and out of coverage under the National Labor Relations Act, unless there was Congressional action to amend the statute. Number 1010 CHAIR JAMES explained her political philosophy was that the people had the power while Mr. Flanagan said in this case that they did not have the power. Therefore, "If we say once you're in you can never get out you're denying future people from making that decision or changing that decision." She struggled with that because it did not fit the democratic process. It seemed that the members of a bargaining unit had more rights than those who were not a member creating an uneven playing field. Similarly, the Twentieth Alaska State Legislature could not bind future legislatures. Number 1116 MR. FLANAGAN replied the public that would potentially revoke this right enjoyed the same rights in their work situation in most private work places. Therefore, "We have the will of the majority with the protection of the minority in this country. And, if you believe that collective bargaining is a basic right of workers, I guess, where we depart is making a differentiation between public and private workers." The public had a voice or we would not be here today. "You folks may in fact exercise that and change it. We hope you don't, but we'll see how it turns out." Number 1165 REPRESENTATIVE VEZEY explained the cities of Bethel, Kotzebue and Haines were in court over the subject of their coverage under PERA. He asked Mr. Flanagan if he knew the outcome of those court cases? Number 1192 MR. FLANAGAN replied there was closure with the city of Kotzebue with the superior court decision, therefore, its option to not be covered under PERA was effective. The city of Haines and their option to not be covered under PERA was upheld by the Alaska Labor Relations Agency. There was a remand to the agency and it was found that the city had effectively exercised its option. He was not sure of the status of the city of Bethel. Number 1251 REPRESENTATIVE VEZEY explained his office had called the city of Bethel and they were still trying to find somebody that knew something about it. MR. FLANAGAN stated it sounded like they did not have an agreement, if it did not know if it was union or not. Number 1263 REPRESENTATIVE IVAN wondered if once a community decided to unionize, if it was forever. CHAIR JAMES replied that currently was the way. The bill would allow for municipalities or areas to opt out again. Number 1318 JOHN CYR, President, National Education Association (NEA) - Alaska, was the next person to testify in Juneau. The NEA-Alaska was opposed to HB 124. It found both sections onerous. The first section that allowed for subcontracting was a bad idea for educational purposes. The law did not just deal with municipalities and state workers, it also dealt with school districts. He explained for 20 years school districts were under Title 14 which did not allow school districts finality in bargaining. School employees did not have the right to binding arbitration nor did they have the right to strike. As a result, the NEA-Alaska spent 20 years talking to members of the legislature on how to resolve the problem. It was the will of the members that school districts have binding arbitration to settle labor disputes with their employees. It was obvious during the discussions that school districts were not interested in binding arbitration because they did not want to put the final decision in the hands of a third party arbitrator, who could be from out of state or not in the community. Therefore, school districts were put under PERA. The NEA-Alaska did not want that, but through the negotiation process it became obvious that it would be the only route to finality. It gave the districts access to the labor relations agency and a playing field that was understood. Last year, the process was tweaked in HB 465. It made the initial proposal for the district and the association open for public review forcing the school district to seek input on its proposals from the public. The NEA- Alaska believed that to be taken out of PERA removed the public and its oversight in school district negotiations. Right now, there were 23 contracts being negotiated around the state. "And, you know they will be settled thoroughly without a whole lot of rancor." MR. CYR further stated that the NEA-Alaska believed subcontracting was a bad idea, especially for schools, because it led to schools- for-profit. He cited the lunch program where the corporate dollar meant more than nutrition. He was concerned that health, safety and the best teaching practices would be less important than whether or not a corporation made money. In addition, subcontracting removed the parents from control. The parents, right now, were ultimately in control of school districts through the school board and through the negotiation process. "When you subcontract then the corporate entity is in control of those -- that section of your work force, not the parents, not the community, but the corporation." MR. CYR further said there were a lot of unintended consequences that ran through the bill for school districts. He explained wages, benefits, working conditions, for example, were bargained for and a part of every contract; and rightfully so. He cited the inclusion of parents and teachers to hire, teacher mentoring to ensure quality and professional growth, school committee to address gang violence and drugs, student and parental input in evaluations, student performance bench marks, exit criteria for seniors, and language for the inclusion of special education children in regular classrooms were the issue being discussed in Anchorage. And, as a result of the bill would be taken out of the public control. In addition, national research indicated that every state that was not unionized, student performance was lower; it dropped by up to 10 points. It came to the ability of districts and states to keep and retain quality people; it was as simple as that. MR. CYR further said, historically, employees had the right to bargain and to meet with their employers to talk about their work conditions. That was the very soul of what America was about. "It's who we are. It's what we do." Therefore, to deny that right to any group - public or private - was wrong. Number 1894 REPRESENTATIVE DYSON asked Mr. Cyr if it would be a leap of logic to infer that the administration was resisting the list of issues he mentioned in the Anchorage contract? Number 1927 MR. CYR replied he would not pretend to be a spokesperson for the administration. But, "Yes." The district was not interested in those proposals. Number 1955 REPRESENTATIVE DYSON asked Mr. Cyr if he could infer that contracting out would have a negative impact, in general, on the quality of education? Number 1984 MR. CYR replied there was research that pointed to the fact that test scores had not gone up but had gone down, therefore, education suffered over the long-range. Number 2012 REPRESENTATIVE DYSON asked Mr. Cyr if he would hold the same position on activities that were outside of the school building, such as, maintenance? Number 2034 MR. CYR replied, if it was believed that one of the functions of unionization was to make sure that the members of the union were quality employees, then it gave the public and the consumer a legitimate measure of protection that was not built in the system, otherwise. Number 2132 REPRESENTATIVE DYSON asked Mr. Cyr if the association would resist any contracting out even for school district activities that were not in the school building? Number 2146 MR. CYR said he was not sure he understood the question. Bus drivers, for example, were subcontracted and there had been some problems. There was very little quality control over who was hired. Number 2170 REPRESENTATIVE DYSON asked Mr. Cyr, if the association would resist any contracting out, even for school district services that did not have direct contact with the students, such as, maintenance of the buses? Number 2198 MR. CYR replied buses were subcontracted in most districts. But, "Yes," the association believed that every employee in a school district moved the agenda of the district and worked for the kids whether they were in a warehouse or a teacher in front of the classroom. They were all working for the children. Number 2236 CHAIR JAMES commented on the bargaining in Anchorage. In addition, the public was not happy with government, unlike Representative Elton who thought it was wonderful. Yet, they did not vote or participate because they felt it would not do any good. They were just generally dissatisfied. The NEA-Alaska was taking a different approach now. She was encouraged and happy because it was listening to the public. Number 2355 CHAIR JAMES further stated speech teachers were contracted out. Contracting out did have its merits, especially when it was not a full-time job for somebody. Number 2398 MR. CYR stated that in the past the association had not told the public what it was bargaining. It was trying now to be responsive to the public comments. MR. CYR further stated that speech teachers were not subcontracted. TAPE 97-25, SIDE A Number 0001 MR. CYR stated that mental health positions were contracted out because school districts did not have the resources to provide the in-depth psychological work that some kids needed. Number 0057 CHAIR JAMES explained that she had friends who went from school district to school district testing students who were contracted out. MR. CYR replied she was correct. Number 0091 REPRESENTATIVE ELTON pointed out that in some cases he agreed with Mr. Dillon who saw a role for government and who saw a role for government employees. "I would just like to say that that too often I think we `demonize' government employees whether they're operating under a collective bargaining agreement or not." REPRESENTATIVE ELTON further stated that the committee had not heard from one school district, municipality, borough or anyone on this issue today saying that there was a problem that needed to be addressed by the adoption of this bill. "I think that many people out there probably think that we're trying to address a problem that they don't have and if they have it they aren't telling us about it." Number 0184 CHAIR JAMES stated that the prime responsibility of government was public safety. And, the committee did talk about public safety a little while ago with a different connotation. She agreed with Representative Elton, however, she thought that the room would be full of people today since this was a controversial issue. Number 0223 MR. CYR stated that Anchorage was out of PERA so it did not have to bargain with its employees; yet, it did bargain because it found it to be the most expedient way. He also cited the city of Palmer and probably Fairbanks were out of PERA and they also bargained with their employees. "It is the most expedient way to negotiate working conditions with employees. It is the standard of the industry for that very reason. The state in its declaration of policy stated that "the legislature finds that joint decision- making is the modern way of administering government." Number 0318 REPRESENTATIVE VEZEY stated that most of the citizens of the state of Alaska did not live in a community that was covered by PERA. The municipality of Anchorage, the City and Borough of Juneau, the Mat-Su Borough, and the city of Kodiak, for example, opted out of PERA. There were approximately 18 communities in the state and some other political subdivisions that were covered by PERA. The bill was saying; therefore, to a distinct minority of Alaskans, that the way they governed themselves was not equal to the way others governed themselves. Number 0388 MR. CYR replied that all 54 school districts were covered by PERA. Every school entity in the state fell under PERA. Therefore, the bill would certainly affect the school districts and thousands of employees. CHAIR JAMES asked the committee members if they were comfortable moving the bill out of the committee today? Number 0455 REPRESENTATIVE ELTON moved to table HB 124. CHAIR JAMES called for a roll call vote. Representatives James, Dyson, Hodgins, Ivan and Vezey voted against the motion. Representatives Berkowitz and Elton voted in favor of the motion. House Bill 124 was not tabled. Number 0515 REPRESENTATIVE HODGINS moved that HB 124 move from the committee with individual recommendations and the attached fiscal note(s). Number 0524 REPRESENTATIVE ELTON objected. Number 0538 REPRESENTATIVE BERKOWITZ stated that Representative Elton made a compelling point. The bill was trying to fix a problem that no one had acknowledge existed. He had not heard from a single school district or political subdivision that said it wanted to opt out. "We can go around fixing problems that don't exist all day long. I just don't think that we ought to be sticking our nose, much less the camel's nose, under that tent." CHAIR JAMES called for a roll call vote. Representative James, Dyson, Hodgins, Ivan and Vezey voted in favor of the motion. Representatives Berkowitz and Elton voted against the motion. House Bill 124 was so moved from the House State Affairs Standing Committee.
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