COLLECTIVE BARGAINING FOR SOME: 

GOVERNOR HOLDEN'S EXECUTIVE ORDER

On June 29, 2001, Governor Holden signed Executive Order 01-09 directing all state departments and agencies within the Executive Branch of the Missouri government to move beyond the narrow requirements of the Missouri Meet and Confer Law and to bargain with state employees on a more equal footing. 

Were you to judge the Governor's Executive Order solely by the hysterical blabbering of management mouthpieces like Missouri Senate Majority Leader Peter Kinder and the Missouri Chamber of Commerce, you might think the Governor had just handed unions the keys to the state treasury and sold state employees into bondage. In truth, the Executive Order is an important but limited and far from radical reform of Missouri's decrepit public employee bargaining law. 

The Order is limited in terms of the number of employees it affects and in terms of its substantive provisions. The Order applies to approximately 30,000 of the 65,000 total state employees and has no effect at all on Missouri's more than 200,000 county and municipal employees. Rather than being a radical move, furthermore, it is a reasonable, measured step for which there is abundant historical precedent. In fact, such executive orders have historically served as a first step in reforming public employee bargaining laws. In 1962, for example, President Kennedy issued an executive order establishing rules for labor-management relations in
the federal sector and requiring federal executive branch departments and agencies to bargain collectively with federal employee unions. In later executive orders, President Nixon revised and built upon President Kennedy's initial 1962 order. And, in 1978, Congress finally enacted a federal labor-management relations statute, which used the previous executive orders as a framework. Furthermore, many other governors, including Kentucky Governor Paul Patton (May 2001), have signed similar executive orders. 

Here is what Governor Holden's Executive Order provides in a nutshell: 

The Executive Order requires both employers and unions to bargain in "good faith," which requires the parties "to approach negotiations with a sincere resolve to reach agreement [and] . . . to meet at reasonable times and places to exchange information and to reduce to writing any item that is agreed to by both parties[.]" The Order further provides that the General Assembly's failure to approve any part of a Memorandum of Agreement (MOU) requiring its approval "shall not constitute bad faith negotiation." 

Because requiring good faith bargaining is the linchpin of any effective collective bargaining law, this provision is an important step beyond the current law's flaccid requirement that the public employer must "meet, confer and discuss" the union's proposals. For the first time, the Governor has ordered departments and agencies under his control to engage in meaningful "good faith" bargaining in an attempt to reach agreements. Before public employers could comply with the bare requirements of the Meet and Confer Law by simply going through the motions without trying to reach agreements. The Executive Order's definition of "good faith" is similar to the requirements of the Kansas Public Employer-Employee Relations Law, which has been in effect for thirty years without any
observable detriment to the Kansas government. 

In a bold but by no means unprecedented stroke, the Executive Order establishes a procedure for impasse negotiations. Specifically, the Order permits either party to the negotiations to make a written request for mediation if, after sixty days of negotiations, issues remain unresolved. For the initial mediation effort, the parties can either use an agreed upon third party neutral mediator or, if they cannot agree upon a mediator, must request help from a professional mediator employed by the Federal Mediation and Conciliation Service (FMCS). This initial mediation "shall commence within (30) days of written notification" and "shall consist only of suggestions and non-binding advice to resolve the impasse[.]" 

Mediation has been a fixture in private sector labor negotiations for decades and, over the years, has helped settle thousands of labor disputes. It is certainly worth a try in Missouri's public sector. If after sixty days of mediation issues remain at impasse, either party may request in writing that those issues be submitted to arbitration "for a final and determinative recommendation." The arbitrator shall be chosen through the FMCS's standard procedures, and the chosen arbitrator must convene the hearing within thirty days of her selection and must issue her decision within sixty days of the conclusion of the hearing. The Executive Order sets forth eight factors that the arbitrator must consider in making her award. Those factors include common sense items like "the effect of an agreement on the ability of the public body to provide public services at current levels" and "the interest and welfare of the public." 

This is an interest arbitration provision, which is quite common in public sector bargaining laws. Similar interest arbitration requirements can be found in the laws of many other states, including Kansas, where teacher contract issues are often submitted to fact finding and recommendations by neutral arbitrators. 

Opponents of the Executive Order have flailed away at this provision as a budget buster that will cost the strapped state many millions of dollars each year. But the Executive Order is crystal clear: "any provision of the agreement which requires an additional appropriation of funds or which is found to be in conflict with the Missouri Constitution or laws shall take effect only on required approval of the appropriation of such funds or required legislative or Constitutional enactment."

 If opponents are upset that Missouri's public employees can bargain over wages, the legislature is to blame because one of the few good things about the Meet and Confer Law is that it specifically allows public employees to bargain over "salaries." That is not always true in public employee bargaining. For instance, wages are not negotiable under the federal sector labor relations statute. 

The Executive Order specifically requires that all MOUs shall contain a grievance procedure ending in "final and binding arbitration for issues that may be legally binding under the Missouri Constitution and laws." Issues that cannot be subject to final and binding arbitration must be submitted to arbitration ending in a written recommended resolution. Again, the Order makes it clear that arbitrators have no authority to require any additional appropriation of funds and that the arbitrator's award must be limited to the interpretation of the terms of the MOU. 

This provision is unexceptional. Arbitration has been the preferred method for resolving disputes involving the interpretation of labor agreements for over a hundred years and has been exceptionally common in the private sector since the end of World War II. Moreover, binding arbitration is a prompt and relatively inexpensive method of solving workplace disputes and blowing off steam that might otherwise propel wildcat strikes and disharmony among the workforce. Finally, many public employers in Missouri—including the City of Kansas City and the Springfield School District—have used arbitration for years.

According to the Executive Order, agreements reached during negotiations "shall take effect immediately upon the agreement being reduced to writing and signed by the parties to the agreement" unless the agreements require additional action by the General Assembly, require the appropriation of additional funds, or conflict with the Missouri Constitution or laws. Furthermore, "Any State Department or Agency which is governed by an autonomous board must have the approval of said autonomous board before a negotiated agreement is deemed final." 

This is a slight improvement over the Meet and Confer Law because it means that negotiators can, within limits, actually make binding agreements at the bargaining table. This may help eliminate surface bargaining, where deals reached at the table are later undone by an unseen higher authority, such as a city council. Unfortunately, unseen higher authorities—namely the autonomous boards and the General Assembly—authority can still undo many agreements reached through negotiations. Thus, this provision means that the Executive Order falls short of establishing collective bargaining on a truly equal footing for both public employers and public employees. 

The Executive Order also provides that "All State Departments and Agencies may . . . include in applicable Memoranda of Agreement, a provision requiring that all bargaining unit members remit dues, fees, assessments or services fees of any type to the Certified Bargaining Representative[.]" The Order goes on to make it clear that service fees paid by nonmembers of the union must be limited to the employee's pro rata share of the union's costs of negotiating agreements, administering the contract, and handling other activities "germane to its function as the Certified Bargaining Representative." 

Moreover, the Order requires unions that have such union security provisions in their MOUs to provide protections for nonmembers who must pay these service fees but who object to the amount of the fees. These protections include (a) written notice of the fee payable in dollars or percentage of regular union dues paid by full members and the basis for determining the fee; (b) an opportunity to challenge the union's fee determination and the right to receive a prompt decision on the challenge by an impartial decision maker; and (c) the right to have the protested fees held in an escrow account during the challenge. 

This provision of the Executive Order has drawn the harshest words from opponents of organized labor, who portray this as something from Mars and a ruse to make all government employees join unions against their will. In fact, however, this paragraph of the Order simply states the current status of Missouri law under the Meet and Confer Law. According to a 1993 decision of the Missouri Court of Appeals for the Eastern District, the Meet and Confer Law permits public employers and unions to agree to union security clauses such as the type described in the Order. These union security clauses are common in both
public and private sector labor agreements, and they serve the reasonable purpose of making sure that everyone who gets the benefits of union representation pays for those services. The law requires unions to represent everyone in their bargaining units fairly whether or not they are members of the union. Union security clauses simply prevent nonmembers from freeloading. These clauses do not require anyone to become a full internal member of the union. The United States Supreme Court has decided many cases affirming that nothing in the First Amendment prohibits union security clauses in the public sector. The Supreme Court has also held that unions must provide procedural safeguards for nonmembers to protest such service fees. The Executive Order is a straight forward reflection of the law governing union security clauses in the public sector. It is not some kind of conspiracy to usurp employee freedoms. 

Finally, the Executive Order emphasizes that "Nothing contained herein shall be construed as encouraging or authorizing employees to strike or engage in any other illegal economic activity." 

Essentially, Governor Holden's Executive Order is a decent early step in the process of moving Missouri along the path taken by many other states, including Kansas, to a point where public employees have more meaningful rights to bargain with their employers in good faith and to expect that agreements reached during that bargaining will be kept as solemn promises. If this is radical, then the world is falling apart and the center will not hold!