Common use of Util Clause in Contracts

Util. Code § 102000 et seq. Its employees have been subject to PEPRA, a law that applies to public sector employees, not to citizens or employees generally. By unilaterally reducing pension benefits, ▇▇▇▇▇ exemplifies the "pernicious effect on the collective bargaining process" that concerned the Eleventh Circuit in Hull. The district court also concluded that the Department erred by not "considering the realities of public sector bargaining," including the fact that any modifications to state pension plans "must be ratified by the state legislature." California, 2014 WL 7409478, at *16-*17. ▇▇▇▇▇▇ adds that in the public sector, terms and conditions of employment are public decisions shaped by political processes and realities outside the direct control of a particular public sector employer and must operate within legislatively-imposed budget constraints and be consistent with the legislature's policy direction. SacRTD Response 11. In SacRTD's view, PEPRA is a legislative policy that California's public employers take to the bargaining table. Id. at 12. The ATU says that the reality of public sector collective bargaining adverted to by the district court is legally irrelevant because SacRTD is an independent agency authorized by state law to negotiate and enter into collective bargaining agreements, and nothing in California law requires submission of those agreements for ratification by the California legislature or any other higher authority in California with the power of the purse. ATU Response 15 & n.8. ▇▇▇▇▇▇ admits that it is required by state law to bargain collectively, and cites nothing in state law that requires the state legislature to ratify the agreements it reaches through collective bargaining. SacRTD Response 6; AR 725-27 (▇▇▇▇▇▇'s discussion of tis authority to maintain an independent, collectively-bargained pension plan, and the review and ratification process for collective bargaining agreements). Thus, I agree with the ATU that ratification by the state legislature is not an issue for SacRTD. The concerns raised by the district court and SacRTD are also not new; they existed when section 13(c) was enacted. Then, as now, state legislatures could exercise control over the terms and conditions of employment outside the direct control of a particular public sector employer. Congress recognized that reality in considering state agencies that were prevented by state law from collective bargaining. As discussed above, Congress decided not to make collective bargaining contingent on state law but instead gave states a choice: provide for a continuation of existing collective bargaining rights directly, allow transit agencies to contract with a private entity to manage a transit system and continue collective bargaining through the private entity (the "Memphis" arrangement), or forego federal funding. Congress accommodated states by not continuing a right to strike. See 109 Cong. Rec. at 5672-73 (Statement of Sen. ▇▇▇▇▇); ▇▇▇▇▇▇▇, 767 F.2d at 953-54. Congress also did not require any particular form of binding arbitration, but did require some process that avoids unilateral control by an employer over mandatory subjects of collective bargaining. ▇▇▇▇▇▇▇, 767 F.2d at 955. Similarly, budget constraints are and have been an issue for many employers, public and private. The solution is for parties with collective bargaining obligations to bargain within budget constraints, not for an employer to use budget constraints as a reason for unilaterally removing a subject from bargaining. As the Court in ▇▇▇▇▇▇▇ recognized, "the substantive provisions of collective bargaining may change, but section 13(c) requires that the changes be brought about through collective bargaining, not by state fiat." 767 F.2d at 953; see also id. at 957 (▇▇▇▇▇▇▇▇, J., concurring) ("a collective bargaining scheme that would have been characterized 'unfair' or 'inequitable' in 1972 might appear just and adequate in 1990. But Congress did not provide for sunsetting section 13(c) and said nothing in the text of the provision to suggest that the essential process entailed in 'the continuation of collective bargaining rights' should come to mean less as time goes by."). For these reasons, the realities of public sector collective bargaining are not a sufficient reason to permit section 13(c) certification of a transit agency that has implemented PEPRA.