Opinion
No. 53740-7-I
Filed: November 8, 2004 UNPUBLISHED OPINION
Appeal from Superior Court of King County. Docket No: 03-2-21503-1. Judgment or order under review. Date filed: 01/12/2004. Judge signing: Hon. Mary E Roberts.
Counsel for Appellant(s), Spencer Nathan Thal, Teamsters Local 117, 553 John St., Seattle, WA 98109-5087.
Tracey a Thompson, Teamsters Local 117, 553 John St., Seattle, WA 98109.
Counsel for Respondent(s), Spencer Walter Daniels, Attorney at Law, PO Box 40108, Olympia, WA 98504-0108.
J. Markham Marshall, Lane Powell Spears Lubersky LLP, 1420 5th Ave Ste 4100, Seattle, WA 98101-2338.
Teamsters Local Union No. 117 (Union) filed an unfair labor practice charge with the Public Employment Relations Commission (PERC), alleging that the Port of Seattle (Port) unilaterally contracted out bargaining unit work in violation of the Public Employees Collective Bargaining Act. A PERC Hearing Examiner dismissed the complaint. The Union appealed to PERC, which reversed the Examiner's decision. The Commission concluded that the work at issue was bargaining unit work and entered a remedial order against the Port. The Port appealed to King County Superior Court, which set aside PERC's decision and dismissed the charge. The trial court concluded that the work was not bargaining unit work because the Port's management decisions had fundamentally changed the nature of its business at Pier 66. The Union appeals, arguing that PERC's decision was proper. We hold that although there was a fundamental change in operations, under the applicable test the Port must still bargain over the decision to contract out work that bargaining unit members had historically performed. We therefore reverse the trial court and reinstate PERC's remedial order.
FACTS
In the late 1980s, the Port began assigning Port of Seattle Police Department (POSPD) officers to cruise ship operations on an on-duty basis. Four or five officers and one sergeant staffed designated security positions at various waterfront terminals whenever cruise ships arrived. In 1998, after significant remodeling, the Bell Street Cruise Terminal (Pier 66) became the exclusive terminal for cruise ship arrivals. POSPD officers continued providing cruise operation security at Pier 66 from 1998 to 1999.
In late 1999 and early 2000, the Port substantially renovated and improved the building at Pier 66 in preparation for Seattle's change from a "port-of-call" city to a "home port" city. On March 24, 2000, the Port signed a contract with Cruise Terminals of America (CTA) to manage cruise ship operations at Pier 66. CTA's duties included managing security operations at Pier 66. In 2000, two or three POSPD officers were assigned to Pier 66 during cruise ship operations.
A "port-of-call" city is only a stop on a cruise ship's journey, whereas a "home port" city is the starting and ending point for a cruise.
The Union represents POSPD officers. The Port of Seattle never notified the Union or bargained with it before contracting with CTA. When the Union learned of the contract, it filed an unfair labor practice charge, alleging that the Port was required to bargain with the Union over both the decision to transfer bargaining unit work and the effects of that decision. When PERC reversed the Examiner's decision, it ordered the Port to bargain with the Union and assign at least five officers and one sergeant at Pier 66 pending resolution of the dispute through collective bargaining.
DISCUSSION
The Administrative Procedure Act governs our review of a PERC decision in an unfair labor practice case. Agency action may be reversed where the agency erroneously interprets or applies the law, its order is not supported by substantial evidence, or its order is arbitrary or capricious. In applying these standards, we review PERC's decision, not that of the Hearing Examiner or the trial court. Because the Examiner's findings are part of the record, we consider them along with the other evidence supporting and opposing PERC's decision.
Pasco Police Officers' Ass'n v. City of Pasco, 132 Wn.2d 450, 458, 938 P.2d 827 (1997) (citing City of Pasco v. PERC, 119 Wn.2d 504, 506, 833 P.2d 381 (1992)).
RCW 34.05.570(3)(d), (e), (i).
Pub. Employees Relations Comm'n v. City of Vancouver, 107 Wn. App. 694, 703, 33 P.3d 74 (2001) (citing Vancouver Sch. Dist. No. 37 v. Serv. Employees Int'l Union, Local 92, 79 Wn. App. 905, 917, 906 P.2d 946 (1995), review denied, 129 Wn.2d 1019 (1996)), review denied, 145 Wn.2d 1021 (2002).
Pasco Police Officers' Ass'n, 132 Wn.2d at 459.
In order to prevail, the Union must first establish that the work at issue is bargaining unit work. The scope of a bargaining unit's work is determined by the language in the collective bargaining agreement (CBA) and history of the parties' conduct. Bargaining unit work includes work historically performed by bargaining unit employees. "Once an employer assigns bargaining unit employees to perform a category of work, that work attaches to the unit and becomes bargaining unit work."
Seattle Police Officers' Guild, Decision 8313-A (PECB, 2004), 2004 WL 725778 (citing Anacortes Police Guild, Decision 6830 (PECB, 1999), 1999 WL 909586, aff'd, City of Anacortes, Decision 6830-A); Int'l Ass'n of Fire Fighters, Local 2916, Decision 3482-A (PECB, 1991), 1991 WL 733701; City of Anacortes, Decision 6863-B (PECB, 2001).
Newspaper Mail Deliverers' Union of N.Y. Vicinity, 298 N.L.R.B. 564, 566 (1990) 1990 WL 122413 (citing Teamsters Local 282, 197 N.L.R.B. 673, 675 (1972)).
Int'l Union of Operating Engr's, Local 286, Decision 8078 (PECB, 2003) 2003 WL 21419638 (citing City of Spokane, Decision 6232 (PECB, 1998)); Int'l Assoc. of Fire Fighters, Local 2876, Decision 7064-A (PECB, 2001) 2001 WL 1076552 (citing Int'l Bhd. of Electrical Workers, Local 483, Decision 6601 (PECB, 1999) 1999 WL 143606).
Int'l Union of Operating Eng'rs, Local 286, Decision 8078 at 6 (citing City of Spokane, Decision 6232).
An employer has a duty to bargain over "wages, hours and working conditions." The decision to transfer bargaining unit work and the effects of that decision on bargaining unit members may be mandatory subjects of bargaining. Whether there is a duty to bargain is a mixed question of law and fact. PERC consistently uses a five factor test as the legal standard to determine whether there is a duty to bargain about the transfer of bargaining unit work. I. Bargaining Unit Work The Union argues that PERC properly determined that bargaining unit members historically performed the work at issue in this case, thus establishing that the work was bargaining unit work. The Port argues that the CBA only covers work requiring commissioned police officers with full police powers. It also contends that the bargaining unit "should have an exclusive right to the work" in order to assert a claim to the work.
Lenz Riecker and Local 31, 340 N.L.R.B. No. 21 (2003) 2003 WL 22142888; Seattle Police Officers' Guild, Decision 8313-A (PECB, 2004), 2004 WL 725778 (citing Cmty. Transit, Decision 3069 (PECB, 1988); Battle Ground Sch. Dist., Decision 2449-A (PECB, 1986); City of Kelso, Decision 2120-A (PECB, 1985); Newport Sch. Dist., Decision 2153 (PECB, 1985)).
See, e.g., Seattle Police Officers' Guild, Decision 8313-A (PECB, 2004), 2004 WL 725778 at 3 (citing Spokane County Fire Dist. 9, Decision 3482-A)); City of Anacortes, Decision 6863-B (PECB, 2001) (citing Spokane County Fire Dist. 9 and Clover Park Sch. Dist., Decision 2560-B (PECB, 1988)).
The bargaining unit consists of POSPD officers.
The Union only claims a right to the work associated with the four to five general security positions assigned to bargaining unit members during cruise operations prior to the CTA contract.
We will grant relief from PERC's decision if the Commission erroneously interpreted or applied the law. We review de novo PERC's conclusions of law, and while we may reach our own legal conclusions, we owe "great deference to PERC's expertise in interpreting labor relations law."
Tapper v. State Employment Sec. Dep't, 122 Wn.2d 397, 403, 858 P.2d 494 (1993).
Skagit Valley Hosp. v. Pub. Employment Relations Comm'n, 55 Wn. App. 348, 360, 777 P.2d 573 (citing Pub. Employment Relations Comm'n v. City of Kennewick, 99 Wn.2d 832, 842, 664 P.2d 1240 (1983); Clallam County v. Pub. Employment Relations Comm'n, 43 Wn. App. 589, 597, 719 P.2d 140, review denied, 106 Wn.2d 1013 (1986)), review denied, 113 Wn.2d 1031 (1989).
The Port cites various sections of the CBA containing the terms "police service," "arrest," and "officer(s)" in arguing that general security work not requiring the powers of a police officer is not covered by the CBA regardless of whether POSPD officers historically performed the work. It claims that "[n]othing in the CBA gives the POSPD bargaining unit the exclusive right to perform generalized security work." The Union responds that the "Port's argument fails to recognize that the parties' CBA does not contain a scope of work provision." It asserts that the CBA does not define unit work to include or exclude general security work. The Union does not dispute that the bargaining unit members are commissioned Port police officers with arrest authority.
(Emphasis omitted.)
The Union is correct that the CBA contains no definition of the bargaining unit's scope of work, and the Port's citations do not help us determine which bargaining unit activities the CBA includes. The Port cites two cases to support its theory that security work is not police work, but these cases do not address whether security work historically performed by bargaining unit members is considered bargaining unit work. The Port does not cite and our research has not found any support for the "exclusivity" requirement it seeks to impose on the scope of bargaining unit work. PERC has found that bargaining unit work may include work that non-bargaining unit employees can do or have done in the past. Thus, the fact that the officers assigned to cruise operations by the Port were commissioned, on-duty police officers does not answer the question. Both they and other non-bargaining unit personnel could and did perform security work for arriving and departing cruise ships. Because the scope of work covered by the CBA is unclear, the answer to the question whether the general security work is bargaining unit work depends on whether that work was traditionally and historically performed by bargaining unit employees. PERC did not err by reaching this conclusion.
See, e.g., Int'l Ass'n of Fire Fighters, Local 2950, Decision 5352 (PECB, 1995) 1995 WL 849658 at 5 (employer's actions made fire prevention and investigation work into bargaining unit work despite the fact that non-bargaining unit personnel could and did perform some of the disputed work); Int'l Ass'n of Fire Fighters, Local 2916, Decision 3482-A (standing by at a fire station was bargaining unit work because off-duty bargaining unit members were occasionally called in to perform it, regardless of a long-standing practice of seeking non-bargaining unit volunteers first).
PERC found that POSPD officers historically performed general security work during cruise ship operations, including at Pier 66. It found that the Port's "own practice of assigning bargaining unit members at Pier 66 gave the Union a legitimate interest in bargaining over both the decisions and effects that contracting out may have had on its members." Substantial evidence must support PERC's findings of fact. Substantial evidence is evidence which would persuade a fair-minded person of the truth of the declared premise.
Hensel v. Dep't of Fisheries, 82 Wn. App. 521, 526, 919 P.2d 102 (1996) (citing Am. Nursery Prods., Inc. v. Indian Wells Orchards, 115 Wn.2d 217, 222, 797 P.2d 477 (1990)).
Testimony from both parties' witnesses supports PERC's finding. Sergeant Tom Monahan, Officer Mikeal Demetruk, and Deputy Chief Tim Kimsey testified that the Port consistently assigned four to five POSPD officers to several general security positions during cruise ship operations. POSPD shift schedules and roll call memoranda confirm this testimony. The Port does not dispute that it assigned POSPD officers with full police powers to cruise ship operations from the late 1980s until 2000. Substantial evidence supports PERC's finding that POSPD officers historically performed the work at issue. As such, it is bargaining unit work.
The Hearing Examiner also found a history of POSPD work during cruise ship operations.
II. Duty to Bargain A. Five Factor Test
PERC uses a five factor test as the legal standard for determining whether an employer has a duty to bargain concerning the alleged transfer of bargaining unit work. The factors include:
(1) The employer's previously established operating practice as to the work in question, i.e., whether non-bargaining unit personnel performed such work before;
(2) Did [the transfer of work] involve a significant detriment to bargaining unit members (as by changing conditions of employment or significantly impairing reasonably anticipated work opportunities);
(3) Was the employer's motivation solely economic;
(4) Had there been an opportunity to bargain generally about the changes in existing practices; and
(5) Was the work fundamentally different from regular bargaining unit work in terms of the nature of the duties, skills, or working conditions?
Seattle Police Officers Guild, Decision 8313-A (PECB, 2004), 2004 WL 725778 at 3 (quoting Spokane County Fire Dist. 9, Decision 3482-A).
The Port does not disagree with the application of the five factor test itself, so we turn to PERC's findings on the first and fifth factors, which the Port does dispute.
The first factor focuses on established operating practice. The Union asserts that it only claims a right to bargain over the four or five general security positions the Port historically assigned to its POSPD officers during cruise operations. Thus, it argues, operating practices at non-cruise facilities are irrelevant. It also contends that only bargaining unit employees staffed these positions during cruise operations. The Port argues that general security services at Pier 66 and other Port facilities were, and continue to be, performed by non-POSPD personnel. It also points out that at other Port facilities, POSPD officers are not in fixed positions, but instead patrol in vehicles or respond when non-POSPD security personnel need police assistance.
There is ample evidence in the record that POSPD officers do not do general security work at other Port facilities, including Sea-Tac Airport and other waterfront terminals. But the Union does not claim jurisdiction over general security work other than that historically assigned to POSPD officers during cruise operations. The scope of work subject to the Union's bargaining request is very limited, and PERC applied the five factor test only to the general security work claimed by the Union. We agree with PERC that it should analyze the first factor based on the limited scope of work the Union asserts should be the subject of collective bargaining.
This does not include a claim to passenger or baggage screening.
The Port asserts that non-POSPD personnel performed the general security work claimed by the Union, and that this "would be a factor in allowing the Port to transfer or subcontract the work without bargaining with Local 117." But the testimony supports the finding that, before the Port signed a contract with CTA in March 2000, the Port assigned only POSPD officers to the four or five general security positions at issue in this case. No evidence supports the Port's claim that non-POSPD personnel staffed the four or five general security positions specifically at issue in this case. PERC's findings on this issue are supported by substantial evidence.
Deputy Chief Kimsey stated that POSPD provided "some of the fixed-post positions as far as general security" at Pier 66, apparently in reference to the four to five positions of relevance. Sergeant Monahan stated that non-POSPD security personnel were at Pier 66, but that only POSPD officers worked the particular positions at issue. Officer Demetruk also stated that only POSPD officers worked the particular positions at issue.
The fifth factor concerns the differences, if any, between the work at issue and bargaining unit work. PERC found that the general "record shows the bargaining unit police officers were assigned the general security work at Pier 66 that CTA personnel now perform prior to the contract between CTA and the employer." Both the Hearing Examiner and trial court characterized the work the CTA employees were performing as new work not previously performed by bargaining unit members. There is no dispute that the actual number of POSPD officers assigned to Pier 66 decreased once the CTA contract took effect. The question is whether eliminating work or transferring it to CTA security personnel caused the decrease.
This finding is restated in PERC's Finding of Fact 9.
The security section of the CTA contract provides that CTA shall "[m]anage the security operations at the Facility [Pier 66], on cruise ship days and for non-cruise ships, as necessary. This will include security staff who will provide security guards and security equipment operators for terminal security." Mark Knudsen, manager of cruise ship business through 2000, testified that CTA security personnel man the magnetometers and the screening of the passengers and the baggage as it goes on the ship. They manage the issuance of badges and the checking of badges for people that have access to and from the ship and to the different working areas on the terminal. And they manage the flow of the crew on and off the ship and checking of credentials as the various suppliers arrive to the gates.
When POSPD officers were assigned to cruise operations before 2000, regular fixed-post positions and associated duties included the following: one officer controlling traffic from Alaskan Way into the terminal parking lot, one officer at the entry gate who coordinated with the usual (non-POSPD) gate security guard, two officers at either end of the apron to prevent unauthorized people from boarding the ship, and another officer inside the shed area, with one sergeant overseeing the entire operation. Sergeant Monahan testified that after the contract, CTA personnel were "working out on the apron area and inside the shed. And there was also another security guard I believe at the gate as well." He had "no doubt" that some of the security work performed by CTA used to be performed by POSPD officers.
The Hearing Examiner focused on functions like operating electronic devices, which POSPD officers never performed. The Union agrees that POSPD officers never did magnetometer work or passenger and baggage screening, and it claims no right to this work. We agree with PERC that the "Examiner erred in not differentiating the general security work from the screening work. The issue of general security work was not sufficiently addressed by the Examiner."
Undisputed testimony from Sergeant Monahan and Mr. Knudson establishes that POSPD officers were responsible for, among other things, preventing unauthorized access to the cruise ships and apron areas. It is less clear whether CTA personnel now do the shed and gate security duties POSPD officers used to perform. Mr. Knudsen's undisputed testimony was that POSPD officers still direct traffic. At a minimum, there is substantial evidence supporting the finding that at least some of the general security work performed by CTA security personnel is not fundamentally different from work POSPD officers previously performed.
Presumably the two officers required by the security plan do this.
B. Fundamental Entrepreneurial Decision
The Port contends that PERC erred in rejecting the argument that its decision to change Seattle from a port-of-call to a home port was a fundamental entrepreneurial decision resulting in a significant change in operations. The Union argues that PERC properly incorporated the U.S. Supreme Court's reasoning in Fibreboard Paper Products Corp. v. N.L.R.B. because the Port transferred bargaining unit work, and substantial evidence supports PERC's finding that no change in operations resulted from the Port's decision to make Seattle a home port. The Port responds that the Court's later holding in First National Maintenance Corp. v. N.L.R.B. governs instead of Fibreboard because changing to a home port significantly altered operations at Pier 66. It argues that applying the balancing test promulgated in First National requires the conclusion that the Port's decision was a managerial prerogative not subject to bargaining.
379 U.S. 203, 85 S. Ct. 398, 13 L. Ed. 2d 233 (1964). PERC indicated that Fibreboard was on point, but then based its decision on the five factor test previously discussed.
452 U.S. 666, 101 S. Ct. 2573, 69 L. Ed. 2d 318 (1981).
In Fibreboard, a company unilaterally contracted out bargaining unit work solely because others could perform the work more cheaply. The Court required the company to bargain over the lost jobs. In so doing, it relied on three factors: (1) the company replaced existing employees with non-bargaining unit employees to do the same work under similar conditions; (2) the decision did not change the company's basic operations; and (3) cost saving is "peculiarly suitable for resolution within the collective bargaining framework." The Court held that "to require the employer to bargain about the matter would not significantly abridge his freedom to manage the business."
Fibreboard, 379 U.S. at 214.
Id. at 213.
In First National, a company unilaterally terminated a portion of its business for economic reasons and bargaining unit jobs were lost. The issue was "whether the decision itself should be considered part of petitioner's retained freedom to manage its affairs unrelated to employment." The Court described three kinds of management decisions: (1) choice of advertising, promotion, product type, and other decisions having only an indirect and attenuated impact on the employment relationship; (2) ordering layoffs, production quotas, work rules, and other decisions almost exclusively related to the employment relationship; and (3) decisions having a direct impact on employment, but made based on "facts wholly apart from the employment relationship." The Court held that the third type of decision, "involving a change in the scope and direction of the enterprise, is akin to the decision whether to be in business at all, `not in [itself] primarily about conditions of employment, though the effect of the decision may be necessarily to terminate employment.'" In both Fibreboard and First National, the Court recognized that deciding whether subcontracting involved a duty to bargain depended on the particular facts in a given case.
First Nat'l, 452 U.S. at 677.
Id.
Id. (alteration in original) (citing Fibreboard, 379 U.S. at 223).
Fibreboard, 379 U.S. at 215; First Nat'l, 452 U.S. at 687-88.
PERC relied on Fibreboard because it found (1) the Port replaced existing POSPD officers with non-bargaining unit employees to perform the same work under similar conditions and (2) the Port's basic operations at Pier 66 remained the same despite the change to a home port. In finding no change in operations, PERC stated that:
The changes at Pier 66, while costing a substantial amount of money, do not indicate a change in the basic direction or scope of the employer's business. The employer was operating a seaport, and it is still operating a seaport. The increase in the number of passenger ships making port calls in Seattle is a difference in degree, not of kind.
We disagree with PERC on this point. In late 1999, once business was in place to make Seattle a viable home port operation, the Port extensively remodeled the building at Pier 66 to prepare for the change. The remodel cost $18 million and included the addition of escalators and a second floor gangway in anticipation of greatly increased passenger loads. The number of passengers physically passing through Pier 66 increased almost twenty-fold during the first year as a home port. The Port presented Mr. Knudson's undisputed testimony that services for a home port differ greatly from those for a port-of-call, including supplying of all the stores and supplies for the ships and the volume of passengers (typically 2,000 or more) embarking and disembarking with luggage. Substantial evidence does not support PERC's finding that there was no change in the basic direction or scope of operations at Pier 66. Rather, substantial evidence indicates the Port's decision to make Seattle a home port city significantly changed and expanded the scope of cruise operations at Pier 66.
There is no dispute that the CTA contract itself did not change operations at Pier 66, but there is substantial evidence that the CTA contract was necessary to implement the change to a home port, and it is thus inseparable from the home port decision. Mr. Knudsen stated that the Port contracted with CTA because we felt like we needed to hire the expertise to manage a complicated facility with the traffic flows that we were expecting. As you might expect trying to handle 2000 people off the ship and onto the ship and the level of baggage and the level of stores that were there, it was a significant demand and we did not have the staff in place nor the expertise within the Port of Seattle to handle that business.
While this case is not easily resolved under either Fibreboard or First National, First National provides a better framework for our analysis because the Port's decision to make Seattle a home port resulted in a change in the scope of operations which in turn required the CTA contract. That contract directly impacted bargaining unit employment at Pier 66.
Neither party asserts that labor costs were an issue in the decision.
This is precisely what the Supreme Court described as the third type of employer decision in First National.
The Union cites Regal Cinemas, Inc. v. N.L.R.B., 317 F.3d 300 (D.C. Cir. 2003), for the proposition that First National only applies in cases involving termination of bargaining unit work, not a transfer of work as here. However, Regal Cinemas indicates First National is inapplicable to transfer cases only in the context of "double-breasted" operations, where a company transfers work from a union to a non-union side of the company. Regal Cinemas, 317 F.3d at 311. Here, the Port transferred work to an outside contractor.
When the employer makes the third type of decision, the Court said that "bargaining over management decisions that have a substantial impact on the continued availability of employment should be required only if the benefit, for labor-management relations and the collective-bargaining process, outweighs the burden placed on the conduct of the business." We must determine what the burden-benefit equation is here.
First Nat'l, 452 U.S. at 679.
The Union argues that the decision to contract out general security work was "wholly distinct and separable from the decision to develop a cruise terminal or even to contract for management of that terminal." It asserts that the benefit for the bargaining process outweighs the burden to the Port because bargaining could establish that the bargaining unit had the qualifications, ability, and time to continue performing the security work despite the change to a home port. The Port argues that because its decision to contract with CTA was not based on labor cost concerns but rather the need for a management team experienced in home port operations, the collective-bargaining process could provide no benefit. It also contends its decision did not substantially impact employment because police work at Pier 66 increased overall in 2000 and no POSPD officers lost their jobs.
The Port also argues that decisions about deploying its officers are purely within its discretion. We do not reach this argument because nothing in the record suggests deployment concerns played a role in the decision to contract out the bargaining unit work.
We address the "substantial impact" argument first. Although the Port argues that no harm resulted from the contract with CTA, The harmful effect of [subcontracting] results from the prejudicial effect on the status and integrity of the bargaining unit. The detriment from [subcontracting] may only be felt in the future, such as when transfers of bargaining unit work eventually lead to erosion of work opportunities, loss of promotional opportunities, and adverse effects on the job security of bargaining unit employees.
Seattle Police Officer's Guild, Decision 8313-A at 3 (citing City of Kennewick, Decision 482-A (PECB, 1979); City of Seattle, Decisions 4163, 4163-B (PECB, 1995)).
Based on the Port's past practice of assigning bargaining unit members to general security positions during cruise ship operations, the bargaining unit could have legitimately expected more general security assignments at Pier 66 corresponding to the significant increase in cruise ship operations after the home port change. Instead, the CTA contract resulted in a loss of general security assignments for POSPD officers.
The issue here is not whether the Port must bargain over its decision to become a home port or contract with CTA, but whether it must bargain over its decision to include bargaining unit security work in the CTA contract. "The common thread of both the Fibreboard and First National decisions is that bargaining is required where the subject matter is amenable to resolution through the bargaining process."
Milwaukee Spring Div., 268 N.L.R.B. 601 (1984) 1984 WL 35998 at 11.
Here, the Port contracted out work, a practice that is inherently amenable to the collective bargaining process. PERC concluded that the importance of the bargaining process overrode any burden to the Port. In its final order, PERC required the Port to bargain with the Union over contracting out the general security work at Pier 66. But PERC did not order the Port to negate or revise the CTA contract because "the parties may find a way to address their concerns without termination of the contract to manage the terminal." The Port did not demonstrate either that CTA required the Port to include bargaining unit work in the contract or that bargaining unit employees could not continue performing the general security work despite the change to a home port. The Union argues that the bargaining process could result in viable alternatives to subcontracting out bargaining unit work, and nothing in the record indicates otherwise. There is no evidence that bargaining with the Union over the general security work would cause an undue hardship for the Port. As such, the benefit for labor-management relations and the collective-bargaining process outweighs the burden on the Port.
First Nat'l, 452 U.S. at 680 (citing Fibreboard, 379 U.S. at 211). The Port cites Dorsey Trailers, Inc. v. N.L.R.B., 134 F.3d 125 (3rd Cir. 1998), as an example of a subcontracting agreement that did not require bargaining. But the Dorsey court based its decision on proof that the employer subcontracted solely to avoid lost sales. It is unclear why the Port included the security work in CTA's contract, but neither party argues it was to avoid lost business.
Certainly the Port has management authority to include general security work in CTA's contract, but this does not eliminate the need to bargain. As PERC recognized, the purpose of bargaining is to protect the communication process between labor and management; it does not mandate specific results. "There is no duty to agree, but the desired communications cannot result in an agreement unless the process is given a chance to operate." As the Union points out, requiring bargaining does not deprive an employer of the freedom to manage his business. PERC did not suggest the Port must bargain over its decisions to become a home port and contract out management of Pier 66. Nor do we. Neither we nor the Commission purports to require the Port to cede control over the scope and direction of its business. We agree with PERC that the Port must bargain over the decision to subcontract bargaining unit work to CTA.
Awrey Bakeries, Inc., 217 N.L.R.B. 730, 733 (1975).
Despite the Port's numerous assertions to the contrary at oral argument, requiring bargaining does not impinge on the Port's unquestioned authority to determine how best to deploy its officers. The Port mischaracterizes the issue here — contracting out general security work — as a "deployment" choice. At no point has the Port argued that CTA took over general security at Pier 66 because POSPD officers were needed elsewhere. Deployment is not the issue, and bargaining will not affect deployment. The cases the Port cites are not relevant because they do not address the situation where, as here, bargaining unit work is lost as a direct result of contracting out the work. Contracting out did not result from a decision to change deployment; it was the contracting out that caused the deployment changes.
III. Arbitrary and Capricious
The Port argues that PERC's order was arbitrary and capricious under RCW 34.04.570(3)(i) because PERC found the home port decision did not result in a change in operations. We do not reach this issue because, while we agree with the Port, there nevertheless is a duty to bargain despite the change in operations at Pier 66.
We reverse the trial court's decision and reinstate PERC's order.
APPELWICK, J. and KENNEDY, J., Concur.