The Consequences for Democratic Self-Government

Many government services, especially in terms of police protection and the administration of justice, must to a large extent be monopolistic; there is little room for competing police forces or competing systems of justice within a jurisdiction. The government is sovereign, establishing rules that all citizens or residents must adhere to, a role that is rarely even approached by for-profit entities. The government employer is expected to directly advance the interests of the public, an expectation that simply does not apply to any individual for-profit company. Two of the most important functions that any local government is expected to provide, police and fire, are quasi-military in nature, requiring high degrees of physical bravery and strict adherence to chains of command if they are to be executed properly. At the same time, any disruption of these and other government services could have catastrophic consequences for a community.

The process of collective bargaining established by PERA changes the functioning of representative government profoundly. Nearly every aspect of policymaking can be affected, even dictated, by the terms of a collective bargaining agreement, but the process of setting a governmental budget is the most straightforward example.

With or without collective bargaining, governments do not operate within a vacuum; they must offer competitive wage and benefit packages if they are to recruit and retain qualified workers. But whether or not one supports collective bargaining, there is no denying that it changes the budget process. In the absence of collective bargaining, elected officials are free to consult with their own financial advisors, develop a wage and benefits package, and present this package to their employees. Government employees are not powerless — they retain the option of looking for work in the private sector or with other government employers — but at least elected officials would be free to follow their own spending priorities and implement a budget without interference.

Collective bargaining changes the process considerably. Modifications to wages and benefits must be negotiated with a union representative before they are implemented. As a contract expires, elected officials cannot presume that they can continue with existing arrangements. Even if the vast majority of the workers are content with their wage and benefits packages, the contract must be renegotiated, and union officials can be expected to present new demands whose impact on the budget must be evaluated. Local governments are not required to meet these demands, but an impasse in negotiations presents its own risks, including unfair labor practice allegations that must be evaluated by the Michigan Employment Relations Commission. Before reaching impasse, local officials must be prepared to demonstrate that they bargained in good faith, which goes beyond ordinary factual honesty. Under both the NLRA model and PERA, "[C]ourts look to the overall conduct of a party to determine if it has actively engaged in the bargaining process with an open mind and a sincere desire to reach an agreement."[3] This can be a difficult judgment for a court to make when a party takes a strong stance on a contractual issue, and the understandable desire to avoid legal difficulties can create an incentive for officials to accept compromises that might otherwise be contrary to sound public policy. Elected officials cannot be certain how a tough negotiating stance will be interpreted. In the case of police officers and firefighters, a failure to reach an agreement will result in the establishment of an arbitration panel, which will then decide terms of employment.

Regardless of one's opinions on the merits of collective bargaining, it is clear that it complicates the process of managing municipal finances. Unless local officials are prepared for a bargaining impasse, unions have an effective veto power over large swaths of a local government or school board's budget, especially where employee compensation is concerned. The sweep of the "union veto" is broad: Based on U.S. census figures for 2005-2006, we estimate that wages and benefits for local government employees in Michigan were equal to 45.6 percent of operations spending, meaning that close to half of a typical local government's budget went to compensation for employees.[4] This is, if anything, a modest estimate of the impact that personnel costs have on government. The Commonwealth Foundation has estimated that salaries and benefits make up 70 percent of the cost of running a school district in Pennsylvania, while the Heartland Institute estimates that more than 80 percent of the city of Chicago's budget is related to personnel costs.[5]

Even more troubling, however, is the impact of work rules. The work of government employees is the work of government itself, and contractual clauses that affect the duties of government employees cannot help but influence the way in which laws are enforced and public policies are implemented. The federal and state constitutions are both predicated on principles of democratic self-government, meaning that all aspects of government are under the effective control of the people, who make policy either directly through referenda or indirectly through elected officials.

Collective bargaining can and often does take important aspects of government policy out of the hands of local elected officials and instead makes those policies the subject of negotiations between the elected representatives of the people and union officials who are not accountable to the citizenry, further broadening the union veto.

To illustrate the problem, consider the following provisions of the current collective bargaining agreement between the Detroit Public Schools and the Detroit Federation of Teachers:

  • Since at least 2002, the contract has specified that all textbooks meet "guidelines established by the District and outlined in the 1968 Textbook Report, Publication 1-112, or its successor, prepared by School-Community Relations." This requirement binds the school board to its existing curriculum policy. If the board should decide to pursue a new approach in terms of curriculum, perhaps to adopt innovative teaching methods or to revise content to reflect new scholarship, it may find itself blocked by a union grievance that forces the board to continue using standards it established in 1968.

    The contract also has very specific requirements for American and World History courses that could be used to block revisions of the history curriculum. These provisions give the union considerable influence in deciding what students are taught, a subject that properly belongs to the discretion of the elected officials representing the people of Detroit.

  • The contract commits the District to "aggressively" seek funds for integration and desegregation. Given Detroit's history, it is understandable that these would be important issues for the school board, but the board should be free to determine its own priorities in terms of lobbying for state or federal funds.
  • The contract states that schedules for adult education facilities will be made through a "District-Union Committee" made up of an equal number of union and district representatives and subject to approval by both union and district officials, making the union the equal of the district in terms of setting the schedule.
  • The contract sets strict class-size limits and further stipulates that class sizes at the beginning of a semester will be substantially below those limits, so that "population shifts" will not result in classes that exceed the student limits. The contract also sets up a "Class Size Review Board," made up of equal numbers of union and district representatives, with authority to resolve class-size complaints. Not only does the contract set class sizes, it has the district share power with the union in terms of how class-size requirements are met.
  • The contract limits the number of students assigned to special education classes. State recommendations cannot be exceeded without the union's permission; there is no indication that the bargainers who drew up the contract considered the possibility that the district might at some point have an unusually high number of students in need of these services. If a student is in need of special education services, the district should be free to arrange for him or her to receive them without consulting the union.
  • The contract sets the lengths of school days and class periods in high schools.
  • The contract establishes specific penalties and procedures for various forms of student misconduct, and creates a "Uniform Code Review Committee" made up of equal numbers of union and district representatives. Student discipline is a vital aspect of educational policy; fairness to students and their parents is best served when student infractions are investigated and penalties set by the body that is accountable to the people of Detroit. While school boards should be encouraged to consult with teachers on the setting of disciplinary standards, final authority over student discipline ought to lie with the elected school board. Under the contract, discipline has become another area of shared authority between the board and the Detroit Federation of Teachers.

    The contract also sets many parameters for report cards, determining how often grades will be passed out and what time periods the grades will reflect. The contract specifies that primary school students will receive "non-graded" report cards. It also sets forth the procedure for handling student appeals of grades, with the final determination made by "Grade Review Panels" made up of union and district representatives. Certainly, teachers should have a great deal of input in evaluating student work, and in general, the grades they hand out should stand. Indeed, it is difficult to imagine a system where they would not.

    But as is the case with curriculum and student discipline, fairness to students and parents dictates that final authority in this area should be left with the elected representatives of the people of Detroit. The process for evaluating student work ultimately ought to be left to the determination of the school board.

  • Finally, the grievance procedure calls for final resolution of all grievances by the American Arbitration Association. Because the contract touches on many areas of education policy and does not attempt to distinguish between matters of public policy and core matters of labor relations — wages, hours, benefits and working conditions — the grievance process could result in educational policy being resolved by the AAA, rather than the elected Board of Education.[*]

By contrast, the typical charter school board, operating without a union contract, has much greater flexibility and control over academics, discipline and general operations, consulting with teachers but retaining authority and accountability to parents. (Michigan charter schools are subject to PERA, but the vast majority remain nonunion by the teachers' choice.) To be fair, it should be noted that the DPS contract is a rather egregious example generated by an especially dysfunctional school district. Still, the Detroit Public Schools contract illustrates that collective bargaining under PERA opens the door to infringements on the authority of elected officials, and shows how one union has taken advantage of PERA to assert control over matters of public policy. The Detroit Public Schools are not alone in allowing this to happen, though; a survey published by the Mackinac Center of public school collective bargaining agreements showed that the overwhelming majority of school districts had agreed to class-size limits as part of collective bargaining.[6]

Nor is this tendency of collective bargaining to encroach on policy matters an entirely new development. In 1987, the Citizens Research Council of Michigan observed that PERA had led to court decisions allowing unions to encroach on local government prerogatives:

"... PERA is the predominant state statute governing public employee relations in Michigan. When a conflict has arisen between another state statute, charter provision, or local ordinance, and a provision of a contract negotiated under PERA, in virtually every instance the contract provision has been held to prevail.

One result of the dominance of PERA, as Attorney General opinions have noted, is that 'public employers and their affected employees [have] the right to, in effect, negotiate a statute out of existence as to the contracting parties through collective bargaining.' [Citation omitted.] This raises serious concerns because the provisions 'bargained out of existence' by the parties may contain safeguards which were enacted at the state or local level to limit the scope and size of government."[7]

Among the statutes that have been effectively trumped by collective bargaining under PERA are:

  • The County Civil Service Act, which prior to the enactment of PERA established local civil service commissions. These commissions set wages and work classifications for local government employees and were intended to ensure that hiring and promotions would be determined by skill, rather than partisan pressures.[8]
  • The Municipal Employees Retirement System established under state law.[9]
  • Local government charters. The state constitution gives counties, cities and villages the authority to draft and amend their own charters, subject to the limits of the state constitution and general state laws. Under this principle of home rule, citizens would be free to shape their own local governments and restrict their actions as they see fit. PERA, however, has been interpreted so that collective bargaining agreements trump the provisions of local ordinances and charters.[10] In this regard PERA arguably has subverted the state constitution.[†]

As a consequence of PERA's undermining of home rule, local ordinances establishing disciplinary standards, residency requirements and staffing standards have been rendered ineffective. Courts have also applied PERA's standards to public school employees, effectively trumping the provisions of education statutes.[11]

In a democratic government, the power to annul legislation must be reserved for the people, their elected officials or, in cases where either exceeds their authority, the courts. When legislative authority is exercised by private entities, such as government employee unions, the inevitable result is to undermine democratic self-government. This situation is dangerous enough when the union focuses on traditional collective bargaining issues, such as wages, benefits, hours and basic working conditions. But government employee unions are developing a distinct public policy agenda that ranges well beyond ordinary workplace issues, and PERA has given them their own unique and powerful tools with which to advance that agenda, to the detriment of the residents of Michigan.

In theory, the duty to bargain is limited to wages, hours and other terms or conditions of employment, but that "other" category remains broad and poorly defined. In practice, any political issue that can be expressed in terms of employee compensation, job duties or work standards and included in a collective bargaining agreement is vulnerable to manipulation by government union negotiators. Since the work of government employees consists of enforcing laws and implementing the decisions of government officials, the range in which union officials can use PERA to usurp authority that the state and federal constitutions leave to the people and their elected officials is disturbingly broad.

[*] These provisions are found in the master agreement between the Detroit Federation of Teachers and the Detroit City School District that took effect July 1, 2002 and originally expired June 30, 2005.  Unlike most government union contracts, which are superseded by new contracts, this collective bargaining agreement was amended and extended in 2005 and 2006, and it remains in effect at this time.

[†] Michigan municipal law is a complicated area beyond the scope of this study, but the obligation to bargain undeniably places restrictions on local governments, and it does so in a manner not addressed by the Michigan Constitution. The Legislature has considerable authority to shape local government operations, including the provisions of local government charters, but it is not clear that it should be able to delegate that authority to private bodies, such as unions, or that it intended to do so when PERA was enacted. It is the opinion of this author that such a delegation has in fact happened, and that at a minimum this issue is ripe for reconsideration by the state courts.