News

Attorney: Under union contracts, district could have re-opened negotiations

In $6M district blunder, unions' first responsibility was to preserve members' compensation, lawyer says

A labor lawyer and former Palo Alto school board member, Alan Davis, said Thursday that the school district could have pushed back against the classified employees' and teachers' unions when a missed contract deadline, discovered in August, led to the district having to pay $4.4 million in unbudgeted raises this academic year.

Davis — who served on the Board of Education from 1979 to 1989 and owns Davis & Reno, a San Francisco law firm that represents employees, labor organizations and union members in labor-management disputes — said in an interview with the Weekly that the two union contracts do not explicitly require a written notification to reopen negotiations under certain financial conditions. A verbal statement — which district negotiator Scott Bowers said he gave in negotiations and other officials said they had also expressed — would have sufficed.

The district, Davis said, may have even "prevailed" had this issue gone to arbitration.

A one-sentence provision in the district's three-year union contracts is at the center of this issue.

It states: "In the event that the actual property tax received for 2016-17 (as determined by the County Assessor report of February 2017) is more or less than 1.5 percent of the amount of the property tax used in the Board Adopted Budget for 2016- 2017, each party has the option to reopen negotiations on the 3 percent increase to the Teachers' Salary Schedule for 2017-18 by March 15, 2017."

What's local journalism worth to you?

Support Palo Alto Online for as little as $5/month.

Learn more

Throughout the last school year, board members and senior district administrators operated under the assumption, codified in the district budget, that there would be no raises for teachers this year. That decision stemmed from a multi-million-dollar shortfall in the district's budget, discovered in summer 2016.

The unions' obligation in this situation, both legal and moral, has been questioned in recent weeks. But Davis said the unions' primary responsibility is to their members, and they did not have a legal responsibility to remind the district about the March 15 deadline.

"Their primary duty is one of good faith to their members, and that's what they have to exercise," Davis said.

A 1967 U.S. Supreme Court case, Vaca v. Sipes — in which a union's members sued union officials for violating the collective bargaining agreement and refusing to take a grievance to arbitration — established three criteria for unions' "duty of fair representation," Davis noted. Unions cannot act arbitrarily, discriminatorily or in bad faith toward its members.

"That extends to all of their relationships with their employees — when they're handling grievances, to not be arbitrary, discriminatory or act in bad faith," he said. "When they're in negotiations, the same standards apply."

Stay informed

Get daily headlines sent straight to your inbox.

Sign up

In a statement the Palo Alto Educators Association posted online after a Palo Alto Weekly story broke the news of the missed deadline, the union's executive board made a similar argument.

To suggest the union should have reminded the district of its responsibility to formally reopen negotiations "is essentially to suggest that we should have acted outside the scope of our contract and without the expressed will of our own membership."

"We have a legal and ethical responsibility to represent our members and their interests, in accordance with state law and our own bylaws. That is what we have done consistently," the teachers union said.

The unions may have had a moral obligation, however, to reopen the contract if the district's financial state warranted it, Davis said. He recalled widespread renegotiations of contractual raises, including in Palo Alto Unified, during the 2008 global financial downturn.

"Where there's really a crisis, almost all unions will agree to renegotiate even with contracts that have provisions that provide for increases," he said.

"There can be a moral obligation in times of stress for the teachers to agree to reopen a contract even though the contract is not required," he added.

The district's ongoing budget shortfall — the result of misestimated property tax projections on the part of the district — might not have been enough to justify this, Davis said. A comparison of last year's and this year's certified, year-end unrestricted fund balance with actual revenue and expenditures is necessary to determine that, he said.

A grievance process would have allowed a full discussion about the district's financial situation, which union leadership would have then explained to their members in advance of a vote on whether the contract should be reopened, he said.

"They have the duty to preserve (compensation) that unless there's a bonafide reason to either freeze or decrease those wages," Davis said.

He also said that any attorney who represented the district in negotiations should be questioned about his or her responsibility to advise the district to reopen negotiations. Firm Lozano Smith was advising the district at the time but was not present at negotiations, according to the district. (Palo Alto Unified no longer uses this firm.)

Emails provided to the Weekly under a Public Records Act request show that both Bowers and Chief Budget Officer Cathy Mak were well aware of the contract deadline months ago and that Bowers had discussed it in union negotiations.

On June 6, Palo Alto High School math teacher Herb Bocksnick emailed Mak, asking: "Did the district properly notify PAEA (Palo Alto Educators Association) by the deadline that they needed to reopen negotiations on the 3% raise for 2017/18?"

Two hours later, Mak forwarded Bocksnick's email to Bowers, asking for a copy of a "letter/email to PAEA and CSEA (California School Employees Association)" regarding the teacher's question.

Bowers quickly wrote back, "We spoke about it in negotiations."

The emails also indicate the district met with the unions for a bargaining session just after the deadline, on March 20.

Bowers said in a previous interview that he "had no idea there were any issues" with the contract when he retired in June, and assumed that any compensation changes would be negotiated "as we normally did" in August, after the district receives updated property tax projections from the county.

Craving a new voice in Peninsula dining?

Sign up for the Peninsula Foodist newsletter.

Sign up now

Follow Palo Alto Online and the Palo Alto Weekly on Twitter @paloaltoweekly, Facebook and on Instagram @paloaltoonline for breaking news, local events, photos, videos and more.

Attorney: Under union contracts, district could have re-opened negotiations

In $6M district blunder, unions' first responsibility was to preserve members' compensation, lawyer says

by / Palo Alto Weekly

Uploaded: Fri, Oct 6, 2017, 6:52 am

A labor lawyer and former Palo Alto school board member, Alan Davis, said Thursday that the school district could have pushed back against the classified employees' and teachers' unions when a missed contract deadline, discovered in August, led to the district having to pay $4.4 million in unbudgeted raises this academic year.

Davis — who served on the Board of Education from 1979 to 1989 and owns Davis & Reno, a San Francisco law firm that represents employees, labor organizations and union members in labor-management disputes — said in an interview with the Weekly that the two union contracts do not explicitly require a written notification to reopen negotiations under certain financial conditions. A verbal statement — which district negotiator Scott Bowers said he gave in negotiations and other officials said they had also expressed — would have sufficed.

The district, Davis said, may have even "prevailed" had this issue gone to arbitration.

A one-sentence provision in the district's three-year union contracts is at the center of this issue.

It states: "In the event that the actual property tax received for 2016-17 (as determined by the County Assessor report of February 2017) is more or less than 1.5 percent of the amount of the property tax used in the Board Adopted Budget for 2016- 2017, each party has the option to reopen negotiations on the 3 percent increase to the Teachers' Salary Schedule for 2017-18 by March 15, 2017."

Throughout the last school year, board members and senior district administrators operated under the assumption, codified in the district budget, that there would be no raises for teachers this year. That decision stemmed from a multi-million-dollar shortfall in the district's budget, discovered in summer 2016.

The unions' obligation in this situation, both legal and moral, has been questioned in recent weeks. But Davis said the unions' primary responsibility is to their members, and they did not have a legal responsibility to remind the district about the March 15 deadline.

"Their primary duty is one of good faith to their members, and that's what they have to exercise," Davis said.

A 1967 U.S. Supreme Court case, Vaca v. Sipes — in which a union's members sued union officials for violating the collective bargaining agreement and refusing to take a grievance to arbitration — established three criteria for unions' "duty of fair representation," Davis noted. Unions cannot act arbitrarily, discriminatorily or in bad faith toward its members.

"That extends to all of their relationships with their employees — when they're handling grievances, to not be arbitrary, discriminatory or act in bad faith," he said. "When they're in negotiations, the same standards apply."

In a statement the Palo Alto Educators Association posted online after a Palo Alto Weekly story broke the news of the missed deadline, the union's executive board made a similar argument.

To suggest the union should have reminded the district of its responsibility to formally reopen negotiations "is essentially to suggest that we should have acted outside the scope of our contract and without the expressed will of our own membership."

"We have a legal and ethical responsibility to represent our members and their interests, in accordance with state law and our own bylaws. That is what we have done consistently," the teachers union said.

The unions may have had a moral obligation, however, to reopen the contract if the district's financial state warranted it, Davis said. He recalled widespread renegotiations of contractual raises, including in Palo Alto Unified, during the 2008 global financial downturn.

"Where there's really a crisis, almost all unions will agree to renegotiate even with contracts that have provisions that provide for increases," he said.

"There can be a moral obligation in times of stress for the teachers to agree to reopen a contract even though the contract is not required," he added.

The district's ongoing budget shortfall — the result of misestimated property tax projections on the part of the district — might not have been enough to justify this, Davis said. A comparison of last year's and this year's certified, year-end unrestricted fund balance with actual revenue and expenditures is necessary to determine that, he said.

A grievance process would have allowed a full discussion about the district's financial situation, which union leadership would have then explained to their members in advance of a vote on whether the contract should be reopened, he said.

"They have the duty to preserve (compensation) that unless there's a bonafide reason to either freeze or decrease those wages," Davis said.

He also said that any attorney who represented the district in negotiations should be questioned about his or her responsibility to advise the district to reopen negotiations. Firm Lozano Smith was advising the district at the time but was not present at negotiations, according to the district. (Palo Alto Unified no longer uses this firm.)

Emails provided to the Weekly under a Public Records Act request show that both Bowers and Chief Budget Officer Cathy Mak were well aware of the contract deadline months ago and that Bowers had discussed it in union negotiations.

On June 6, Palo Alto High School math teacher Herb Bocksnick emailed Mak, asking: "Did the district properly notify PAEA (Palo Alto Educators Association) by the deadline that they needed to reopen negotiations on the 3% raise for 2017/18?"

Two hours later, Mak forwarded Bocksnick's email to Bowers, asking for a copy of a "letter/email to PAEA and CSEA (California School Employees Association)" regarding the teacher's question.

Bowers quickly wrote back, "We spoke about it in negotiations."

The emails also indicate the district met with the unions for a bargaining session just after the deadline, on March 20.

Bowers said in a previous interview that he "had no idea there were any issues" with the contract when he retired in June, and assumed that any compensation changes would be negotiated "as we normally did" in August, after the district receives updated property tax projections from the county.

Comments

Noone home
Barron Park
on Oct 6, 2017 at 7:19 am
Noone home, Barron Park
on Oct 6, 2017 at 7:19 am
20 people like this

Not really. That would have required the board to show true leadership, which the current board has repeatedly shown to be sadly lacking.


Sanctimonious City
Triple El
on Oct 6, 2017 at 9:04 am
Sanctimonious City, Triple El
on Oct 6, 2017 at 9:04 am
32 people like this

I made similar points in my post when the story first broke.

The district reaction perhaps shows that while they possibly used it as an excuse to camouflage what they really wanted to do anyway.

They certainly did not aggressively fight it and then they eventually rebranded it as a mistake.

The classic bureaucratic salute. Shrugging the shoulders, smiling sheepishly and then saying there's nothing we can do.


Barron Park dad
Barron Park
on Oct 6, 2017 at 12:25 pm
Barron Park dad, Barron Park
on Oct 6, 2017 at 12:25 pm
10 people like this

Very good and informative article. However, I wish the writer of this article had tried to solicit a response from the Board members on why they didn't even bother to try.

This $6M error is plainly shocking (remember, it is the entirety of the annual PiE Parents in Education contributions to the District). All stops should have been pulls to try to walk it back. Or least make the effort to try.


Roger
Evergreen Park
on Oct 6, 2017 at 12:27 pm
Roger, Evergreen Park
on Oct 6, 2017 at 12:27 pm
20 people like this

So bottom line,the board blew it,so they cut off the head (McGee) but left the body of the problem unscathed.
Methinks the board needs to accept blame,especially those who reached immediately for a scapegoat.


Curmudgeon
Downtown North
on Oct 6, 2017 at 3:24 pm
Curmudgeon, Downtown North
on Oct 6, 2017 at 3:24 pm
22 people like this

"The unions may have had a moral obligation, however, to reopen the contract if the district's financial state warranted it, Davis said."

It's the same moral obligation all of us have to not take unfair advantage of incompetents.


PAEA blew it!
Another Palo Alto neighborhood
on Oct 7, 2017 at 2:05 pm
PAEA blew it!, Another Palo Alto neighborhood
on Oct 7, 2017 at 2:05 pm
21 people like this

It is not about what PAEA and Teri Baldwin had to legally do, it is about what they morally are not doing.


board as stepping stone
Fairmeadow
on Oct 7, 2017 at 2:37 pm
board as stepping stone, Fairmeadow
on Oct 7, 2017 at 2:37 pm
11 people like this

I agree with Roger that the Education Board members share culpability with McGee, who they were happy to sacrifice. Given that many Board members use their first elected position as a stepping stone to higher office (typically city council) the question is whether their or not their future political ambitions will be impacted by the $6M "mistake.'


Resident
College Terrace
on Oct 7, 2017 at 2:43 pm
Resident, College Terrace
on Oct 7, 2017 at 2:43 pm
6 people like this

@steppingstone, who was the last person who used pausd as a stepping stone? Gail Price served one term on city council maybe 10 years ago. Before that, was it Liz Kniss and Simitian, a generation ago? I look at the current board, and I'm not sure any of them have any political ambition.


common sense
Midtown
on Oct 7, 2017 at 8:27 pm
common sense, Midtown
on Oct 7, 2017 at 8:27 pm
2 people like this

Resident @ College Terrace, there may not be board members who have future political ambitions, but there are board members who have potential conflicts: Melissa is associated with an educational company that markets to the high school market, and Jennifer DiBrienza advertises herself as an "educational consultant".


Sanctimonious City
Community Center
on Oct 7, 2017 at 10:22 pm
Sanctimonious City, Community Center
on Oct 7, 2017 at 10:22 pm
4 people like this

I am thinking of starting a boutique consulting company that caters to the school district administration.

It will have a slick acronym for a name like SEL. Not to confuse it with Social Emotional Learnimg, this one stands for Sexual assault and Expense Management Liability.

Maybe the district could spare a few dollars from the engorged budget of the first one and spend it on some basic training on the the second one.


AP
Barron Park
on Oct 7, 2017 at 11:17 pm
AP, Barron Park
on Oct 7, 2017 at 11:17 pm
10 people like this

Conclusion: the teachers union has no morals.


Contract
Registered user
Jordan Middle School
on Oct 7, 2017 at 11:52 pm
Contract, Jordan Middle School
Registered user
on Oct 7, 2017 at 11:52 pm
1 person likes this

From the contract: if actual property tax received "is more or less than 1.5 percent of the amount of the property tax used in the Board Adopted Budget..."

1.5%?

1.5% is a such small amount of a multi-million dollar budget, it was almost inevitable it would be reached. It is ridiculous such a small variance from a triggered such a major event as a re-negotiation or change in compensation.

The question is why did very experienced negotiators and Superintendent agree to such a small variance?

This is absolutely one of the most important contracts the Board approves. Why would a Board comprised of finance people agree to it?

Feelings about the District's Negotiator and Superintendent might be more positive had they not told the Board the Negotiators pay was not tied to the teacher's contract, when his contract guaranteed he automatically received the same raise he negotiated for the teachers. (Add negative feelings to Board members who did not know what these contracts said, even though they approved these Administrator's contracts and had access to them at all times.)

Feelings about the now gone Superintendent might be more positive if he did not reveal a complete ignorance the contract resulted in automatic back pay raises for Administrators, even those recently given substantial raises for promotions in a recent reorganization. (Add negativity points for not providing the Board information they requested about Administrator's salaries, once again using the Administration's tactic "ignore Board instructions and do not provide information they need in time to vote.)

Feelings about the District's Administrators might be more positive if the Administration had not made the structure of the deal public so very late and as a surprise to the public, giving the public little time to raise concerns, and so late in the negotiation process the teachers were expecting it. This is very similar tactic to the one used in promoting the now-resigned compliance officer and retention of a legal firm whose failures lead to the non compliance issues we are dealing with today. It was clear the hiring decisions were made before the reorganization creating the position was approved, behind closed doors, and had to be known to the Board for some time earlier.

Feelings about the Union might be more positive if the Union had not attacked Board Members for raising valid public policy concerns about the contract. In retrospect, the Board Members who raised the concerns were correct. The District could not afford the contract, and it was not sustainable.

Feelings about Board Members might be more positive if they had not framed approval as an issue of "if you do not agree to this Agreement, you do not support teachers." These Board members used the "Us vs. Them" tactic again, the same strategy used when families and the OCR who wanted bullying of disabled children stopped.

None of the 3 Major Players behaved in a blameless manner during the approval process.

None of the 3 Major Players behaved in a way expected of senior policy makers at this level.

None of the 3 Major Players behaved in a way that was particularly mature or professional.

The shortfall and resulting events could be seen as unfortunate mistakes had the parties been transparent, forthright, and respectful to other human beings.


Chris Dewees
Leland Manor/Garland Drive
on Oct 8, 2017 at 7:08 am
Chris Dewees, Leland Manor/Garland Drive
on Oct 8, 2017 at 7:08 am
2 people like this

While perhaps technically legally accurate as to who would win if the teacher raises were litigated, as a practical matter the process would have created an expensive and acrimonious nightmare with an uncertain outcome, hardly a good idea given the multitude of issues the District is facing, the budget fiasco being only one. The article makes clear that at least Bowers and Mak were aware of the issue prior to the deadline, making the District’s failure to deliver a timely, simple written notification to the Union incomprehensible. As much as this may feel wrong, we cannnot blame the Union for this mess; its obligation is to uphold the interests of its members. Moreover folks, McGee was not “sacrificed.” He had to go for multiple reasons and a pattern of behavior which requires no further reminder. That said, the Board absolutely shares responsibility for the contract miss, and its complacency and oversight failures over the last many years have been a disservice to the community. Yet we, the voters, ultimately own this: time and again we suffer collective amnesia when we are asked to choose the people entrusted to ensure our children receive an excellent education in a safe, healthy and fiscally sound environment.


truth
Adobe-Meadow
on Oct 8, 2017 at 12:46 pm
truth, Adobe-Meadow
on Oct 8, 2017 at 12:46 pm
Like this comment

@Resident,

That's the problem. No one on this board has any ambition. They're certainly not doing the district any good.


You can blame the union
Another Palo Alto neighborhood
on Oct 8, 2017 at 2:03 pm
You can blame the union, Another Palo Alto neighborhood
on Oct 8, 2017 at 2:03 pm
9 people like this

There is plenty of blame for this debacle, and that includes PAEA, that includes Scott Bowers, who has always been the administrator in charge of negotiations. The teachers need some good publicity, the past few years have revealed outliers at both ends: really good teachers, and then those who make the headlines for arrests and inappropriate behavior. Teachers are just like everyone else, there are good and bad, but PAEA has represented them poorly, they make it seem that the teachers as a group are primarily about getting paid.


Don't miss out on the discussion!
Sign up to be notified of new comments on this topic.

Sorry, but further commenting on this topic has been closed.