Proposed Article I, Section 28(3), states, “No existing or future law of the State or its political subdivisions shall abridge, impair or limit” the rights discussed in Proposal 2’s previous two subsections. This provision has essentially two components. The first prohibits state and local lawmakers from attempting through law to limit PERA or the Labor Relations and Mediation Act. This makes explicit what it is already implicit: that state law cannot trump the state constitution.
The second component, however, can be described, without hyperbole, as a radical proposition — that a collective bargaining agreement has the power to override state and local law. There are just two exceptions: Collective bargaining agreements cannot override a state law to prohibit government employees from striking,[*] and they cannot abrogate the Legislative’s power to set “minimum levels” for “wages, hours, and other terms and conditions of employment.”
The radical power that remains, however, is that any past, present or future state or local law that would “abridge, impair, or limit the right to collectively bargain for wages, hours and other terms and conditions of employment” is susceptible to nullification by a collective bargaining agreement.[†] And since collective bargaining agreements by definition involve negotiations over “wages, hours and other terms and conditions of employment,” the key to understanding the scope of this radical power is to explore the definition of that phrase.
The Meaning of “Wages, Hours and Other Terms and Conditions of Employment”
The range of laws that would be invalidated by Proposal 2 is indicated by a legal term of art. Both Section (2) and (3) of the proposal uses the term “wages, hours, and other terms and conditions of employment.” The proposed amendment’s language is borrowed from similar language in the NLRA and PERA.
The Michigan Supreme Court has explained the significance of this phrase:
In both the PERA and the NLRA, the collective bargaining obligation is defined as the mutual duty of labor and management to bargain in good faith with respect to “wages, hours, and other terms and conditions of employment.” The subjects included within the phrase “wages, hours, and other terms and conditions of employment” are referred to as “mandatory subjects” of bargaining. Once a specific subject has been classified as a mandatory subject of bargaining, the parties are required to bargain concerning the subject, and neither party may take unilateral action on the subject absent an impasse in negotiations.
The Michigan Supreme Court held that courts should take a “liberal approach to what constitutes a mandatory subject of collective bargaining.” The Michigan Court of Appeals has suggested that mandatory subjects should be even more liberally construed under PERA than under the NLRA because government employees, in contrast to their private-sector counterparts, are forbidden to strike.
In 1998, the Michigan Supreme Court set forth some (but not all) mandatory subjects under PERA:
Mandatory subjects of collective bargaining are comprised of issues that “settle an aspect of the relationship between the employer and employees,” and include, but are not limited to, terms and conditions of employment concerning hourly, overtime, and holiday pay, work shifts, pension and profit sharing, grievance procedures, sick leave, seniority, and compulsory retirement age. Health insurance benefits are mandatory subjects of bargaining.
The breadth of the concept of mandatory subjects of bargaining can best be demonstrated by a discussion of a collective bargaining dispute at Ford Motor Company that was eventually decided by the U.S. Supreme Court. In that case, the court reviewed whether Ford Motor Company needed to bargain over “prices for in-plant cafeteria and vending machine food and beverages.”
The court held that the courts should defer to the NLRB’s “special expertise” in determining what should be a mandatory subject. This deference was necessary since, “Congress made a conscious decision to continue its delegation to the Board of the primary responsibility of marking out the scope of the statutory language and of the statutory duty to bargain.” The court noted that the price of in-factory food was likely of “deep concern to workers” and is “plainly germane to the ‘working environment.’” The United States Supreme Court held that the food prices were a mandatory subject of collective bargaining. Thus, because private employees may legally strike, the workers had the legal ability to strike over the price of a candy bar or can of soda.
Almost as important as the breadth of mandatory subjects of bargaining is the government board that will decide what qualifies. The proposed amendment does not allow the breadth of this term to be decided by the people’s representatives in the Legislature. Rather, the scope of this amendment will be decided by the Michigan Employment Relations Commission, a three-member unelected state labor board.
It should also be noted that unlike the NLRB, MERC would not receive a high degree of deference from the courts. The Michigan Supreme Court has ruled that executive agency decisions are due “respectful consideration,” but that ultimately the duty of interpreting state law remains with the courts. As a result, MERC decisions are even more likely to be appealed to the court system than NLRB decisions are. Given the power granted to collective bargaining agreements under Proposal 2, the net effect of this proposal would almost certainly be substantial and protracted litigation over the legal scope of collective bargaining.
[*] Proposal 2 includes no requirement that the Legislature continue the government-employee strike prohibition that has existed since 1947.
[†] A number of laws that could be invalidated through this provision will be discussed below, under “Major Laws Susceptible to Challenge.”