BILL ANALYSIS                                                                                                                                                                                                    






                 Senate Committee on Labor and Industrial Relations
                                 Ted W. Lieu, Chair

          Date of Hearing: March 13, 2013              2013-2014 Regular  
          Session                              
          Consultant: Gideon L. Baum                   Fiscal:Yes
                                                       Urgency: No
          
                                   Bill No: SB 25
                                  Author: Steinberg
                       As Introduced/Amended: December 3, 2012
          

                                       SUBJECT
          
             Agricultural labor relations: contract dispute resolution.


                                      KEY ISSUE

          Should the Legislature remove the limitations on which  
          collective bargaining negotiations between labor organizations  
          and agricultural employers qualify for mandatory mediation, as  
          well as provide that the mandatory mediation must be implemented  
          while appealed?

                                      ANALYSIS
          
           Existing law  provides for a secret ballot election process for  
          agricultural workers where a petition has been submitted, as  
          specified, asking for the opportunity for workers to decide  
          whether to select a particular union as their collective  
          bargaining representative.  
          (Labor Code 1140 to 1166.3)

           Existing law  requires that the Agricultural Labor Relations  
          Board (ALRB) follow applicable precedents of the National Labor  
          Relations Act.  (Labor Code 1148)

           Existing law  provides for a mandatory mediation process for  
          negotiating a collective bargaining agreement between an  
          agricultural employer and a certified labor organization any  
          time after:

             1)   90 days after a  renewed  demand to bargain by a labor  
               organization or agricultural employer certified before  









               January 1, 2003;
             2)   90 days after an initial demand to bargain by a labor  
               organization or agricultural employer certified before  
               January 1, 2003; or
             3)   60 days after the Agricultural Labor Relations Board  
               (ALRB) certified a labor organization, or rejects a  
               decertification election, due to employer misconduct.

           The mandatory mediation process  only applies to agricultural  
          employers of  25 or more  employees.

          (Labor Code 1164)
           
          Existing law  provides that within 60 days of the Agricultural  
          Labor Relations Board (ALRB) issues a final order on the  
          mediation, either the agricultural employer, the labor  
          organization, or the ALRB may file an action to enforce the  
          mediation agreement in superior court.  No stay on a final order  
          of the ALRB can be issued unless the court finds  all of the  
          following conditions are met  :

             1)   The appellant has demonstrated that he or she will be  
               irreparably harmed by the implementation of the board's  
               order, and 
             2)   The appellant has demonstrated a likelihood of success  
               on appeal. 

          (Labor Code 1164.3)
           
          Existing law  provides the above-discussed mandatory mediation  
          process can occur only if  all of the following conditions are  
          met  :

             a)   The parties have failed to reach agreement for at least  
               one year after the date on which the labor organization  
               made its initial request to bargain; 
             b)   The employer has committed an unfair labor practice, and  

             c)   The parties have not previously had a binding contract  
               between them.

               (Labor Code 1164.11)
          Hearing Date:  March 13, 2013                             SB 25  
          Consultant: Gideon L. Baum                               Page 2

          Senate Committee on Labor and Industrial Relations 
          









           This bill  would strike the above conditions, allowing for a  
          mandatory mediation process upon the tolling of the timelines,  
          irrespective of bargaining history.

           This bill  would also strike the requirement that, for collective  
          bargaining negotiations certified before January 1, 2003, the  
          mandatory mediation process would only start for a  renewed   
          demand to bargain.

           This bill  would also extend the mandatory mediation provisions  
          to a successor agricultural employer who purchases all or part  
          of an agricultural employer who had an obligation to bargain.

           This bill  would also provide that an agricultural employer or  
          labor organization may file an order to enforce a mandatory  
          mediation order from the ALRB even if a party seeks appellate  
          review of the decision.  

           This bill  also requires that the ALRB's order must be  
          implemented while an ALRB review is pending.

           This bill  also provides that a court may only issue a stay if: 

             1)   The appellant has demonstrated  by clear and convincing  
               evidence  that he or she will be irreparably harmed by the  
               implementation of the board's order, and 
             2)   The appellant has demonstrated  by clear and convincing  
               evidence  a likelihood of success on appeal. 
             3)   The court deciding the stay shall provide written  
               findings and analysis supporting the decision to grant a  
               stay.
                                      COMMENTS

          
          1.  What is the Mandatory Mediation Process?

            The mandatory mediation process was created by two bills, SB  
            1156 (Burton) and AB 2596 (Wesson) in 2002.  While the  
            provisions of the mediation process have undergone some minor  
            tweaks, the mediation process provided under existing law  
            remains largely unchanged.  Principally, the limitations on  
          Hearing Date:  March 13, 2013                             SB 25  
          Consultant: Gideon L. Baum                               Page 3

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            when an agricultural employer or a labor organization can ask  
            for the mandatory mediation process remain the same.  

            They are:

             a)   The parties have failed to reach agreement for at least  
               one year after the date on which the labor organization  
               made its initial request to bargain; 
             b)   The employer has committed an unfair labor practice, and  

             c)   The parties have not previously had a binding contract  
               between them.

            Assuming the above-requirements are met and the  
            above-discussed timelines are past, a request for mandatory  
            mediation triggers a specific process.  The Agricultural Labor  
            Relations Board (ALRB) must immediately issue an order  
            directing both parties to meditation and asks the California  
            State Mediation and Conciliation Service for a list of nine  
            mediators who have experience in labor mediation.  Both  
            parties select a mediator from the list; if they cannot agree,  
            they strike names from the list until a mediator is selected  
            by the process of elimination.  The costs of the mediation  
            process are borne equally by both parties.

            Upon appointment, the mediator schedules a 30 day period for  
            mediation, which can be extended if necessary.  If issues are  
            outstanding after the 30 day period, the mediation process is  
            considered exhausted.  Within 21 days, the mediator issues the  
            final terms of a collective bargaining agreement, including  
            issues in dispute by the parties.  If the mediator decides  
            issues in dispute, the mediator must explain the basis for his  
            or her ruling.  Within 7 days of the ruling, either party may  
            appeal a mediator's decision to the ALRB.  The ALRB may only  
            review the mediators decision if:

             1)   The mediator's decision goes beyond wages, hours, and  
               working conditions of employment;
             2)   The mediator's decision is based on clearly erroneous  
               findings of material fact; or 
             3)   The mediator's report is arbitrary or capricious. 

          Hearing Date:  March 13, 2013                             SB 25  
          Consultant: Gideon L. Baum                               Page 4

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            If neither of the above conditions exists, the mediator's  
            report becomes the final order of the ALRB.  If one or more of  
            the above conditions exists, then the mediator mediates the  
            process again.  If, after issuing a new decision, a party  
            believes that the mediator is corrupt, then a new mediator  
            would be called in.  Finally, either party could ask for a  
            stay from a court.  A stay would be granted if the court  
            believed that the mediator's decision would cause irreparable  
            economic harm and the appeal had a strong chance for success. 




          2.  Need for the Bill?  

            SB 25 seeks to address two principal criticisms of the  
            existing mediation process: the limited number of negotiations  
            that qualify for the process and the length of time for the  
            mediation to become binding.  On the first criticism,  
            proponents argue that, after a labor election result is  
            certified and a labor representative is elected, the relations  
            between an agricultural employer and a labor organization  
            remain tense.  Having a mandatory and binding mediation  
            process that allows for a neutral third party to oversee the  
            negotiations and ensure that a collective bargaining agreement  
            is completed.  SB 25 addresses this issue by removing the  
            existing limitations on who can avail themselves of the  
            mandatory mediation process.

            The second criticism that SB 25 seeks to address is the length  
            of time it takes for a mediation decision to become binding.   
            While the process between the mediator and the ALRB is  
            straightforward, a court can stay the mediation indefinitely  
            without explaining the reasoning or without an evidentiary  
            process that establishes that a party would suffer irreparable  
            harm.  Additionally, parties are not following the terms of  
            the mediation while the appeal is pending.  SB 25 addresses  
            this issue by requiring that the court may only stay a  
            mediator's decision with clear and convincing evidence, and  
            that the court must provide written findings explaining their  
            reasons for staying the mediator's decision.  Additionally, SB  
            25 requires the parties to follow the mediation decision while  
          Hearing Date:  March 13, 2013                             SB 25  
          Consultant: Gideon L. Baum                               Page 5

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            the appeal is pending.  


          3.  Highland Ranch/San Clemente Ranch, Ltd. and the Successorship  
            Doctrine:

            Under Labor Code Section 1148, the Agricultural Labor  
            Relations Board must follow any applicable precedents of the  
            National Labor Relations Board (NLRB) precedent.  The U.S.  
            Supreme Court issued a landmark decision in John Wiley & Sons,  
            Inc. v. Livingston, 376 U.S. 543 (1964), which found that the  
            arbitration provisions of a collective bargaining agreement  
            survive a merger.  This created what is frequently referred to  
            as the "successorship doctrine" in NLRB precedents.  This  
            doctrine, however, has frequently been revisited by the NLRB  
            under different administrations.

            The Agricultural Labor Relations Board (ALRB) utilized the  
            successorship doctrine in Highland Ranch/San Clemente Ranch,  
            Ltd. (1979) 5 ALRB No. 54.  The use of this doctrine was  
            upheld by the California Supreme Court in 1981.  However, the  
            courts have noted that the use of this doctrine is complex in  
            the agricultural setting due to complex ownership and  
            employment operations (Michael Hat Farming Co. v. Agricultural  
            Labor Relations Bd. (1992) 4 Cal. App. 4th 1037).  SB 25 would  
            codify the successorship doctrine.


          4.  Proponent Arguments  :
            
            Proponents argue that SB 25 addresses several deficiencies  
            with the Agricultural Labor Relations Act, which prevent  
            employees from realizing the full benefits of a collective  
            bargaining agreement.  Proponents argue that SB 25 addresses  
            the issue of employers refusing to negotiate a new collective  
            bargaining agreement after the initial agreement expires by  
            allowing for mandatory mediation to resolve the dispute.   
            Proponents argue that some employers have used restructuring  
            as a way to nullify union elections, which SB 25 resolves by  
            creating a successor doctrine similar to what is found in the  
            National Labor Relations Act. Proponents also note that this  
            bill limits the mediation provisions to employers of 25 or  
          Hearing Date:  March 13, 2013                             SB 25  
          Consultant: Gideon L. Baum                               Page 6

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            more employees and both parties can select the mediator.


          5.  Opponent Arguments  :

            Opponents argue that SB 25 would present significant  
            challenges for agricultural employers.  Opponents argue that  
            SB 25 allows a union that was certified prior to January 1,  
            2003 to request binding arbitration with an agricultural  
            employer, even if no attempt was made by the union to  
            negotiate an initial contract.  Opponents also note that SB 25  
            would bind successor employers, which the opponents argue  
            could require an employer to negotiate a union contract due to  
            actions of a prior grower or owner years prior.  Finally,  
            opponents argue that this will require negotiations years  
            after an initial certification, which could create the  
            situation that the newly unionized employees never voted for  
            the union.


          6.  Prior Legislation  :

            SB 126 (Steinberg), Chapter 697, Statutes of 2011, reforms the  
            Agricultural Labor Relations Act to provide explicit authority  
            to the ALRB for bargaining orders, to provide explicit  
            timelines for election challenges and to strengthen mandatory  
            mediation requirements.
                                          

                                       SUPPORT
          
          United Farm Workers (Sponsor)
          American Federation of State, County and Municipal Employees,  
          AFL-CIO
          California Labor Federation, AFL-CIO
          California Rural Legal Assistance Foundation (CRLAF)
          

                                     OPPOSITION
          
          Agricultural Council of California
          California Association of Nurseries and Garden Centers
          Hearing Date:  March 13, 2013                             SB 25  
          Consultant: Gideon L. Baum                               Page 7

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          California Association of Wheat Growers
          California Bean Shippers Association
          California Cattlemen's Association
          California Chamber of Commerce
          California Citrus Mutual
          California Cotton Ginners Association
          California Cotton Growers Association
          California Dairies, Inc.
          California Farm Bureau Federation
          California Grain and feed Association
          California Grape & Tree Fruit League
          California Pear Growers Association
          California Seed Association
          California State Floral Association
          California Tomato Growers Association
          Far West Equipment Dealers Association
          Neisi Farmers League
          Ventura County Agricultural Association
          Western Agricultural Processors Association
          Western Growers Association





















          Hearing Date:  March 13, 2013                             SB 25  
          Consultant: Gideon L. Baum                               Page 8

          Senate Committee on Labor and Industrial Relations