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Baumgartner v. Perry Public Schools

Court of Appeals of Michigan

March 12, 2015


State Tenure Commission LC Nos. 12-001101-ED, 12-000016, 12-000011

Before: Donofrio, P.J., and Saad and Meter, JJ.


In these consolidated appeals, respondent school districts ask us to reverse a series of orders entered by the State Tenure Commission, which instructed administrative law judges to hear petitioners' suits. For the reasons stated below, we hold that the State Tenure Commission does not have jurisdiction to hear petitioners' claims, and accordingly, we reverse its administrative orders and dismiss petitioners' actions.



This case is about governmental power and authority, and who gets to make and review decisions about teacher layoffs in the public schools. Prior to the historic enactment of the four pieces of tie-barred[1] legislation at issue, [2] teacher unions, for all practical purposes, decided what factors governed teacher layoffs. Though the Legislature could have decided, pursuant to its constitutional role in public education, [3] to make this important public-policy choice, it did not do so until 2011. Instead, by virtue of making teacher layoffs a mandatory subject of collective bargaining, the Legislature left the regulation of layoffs to the collective-bargaining process. Virtually all collective-bargaining agreements used seniority-described as "last in, first out" ("LIFO")-as the method for laying off teachers.[4]

Because length of service, not merit, governed who would be laid off and who would be retained, a simple application of LIFO meant that few disputes arose in the implementation of layoff decisions. But, if disputes occurred, the governmental agency that had (and has) exclusive authority over the enforcement of union-related public-sector labor laws, [5] the Michigan Employment Relations Commission ("MERC"), adjudicated any legal challenge.[6] The Legislature did not grant any authority to any other administrative agency to deal with or review the subject of teacher layoffs. Seniority based layoffs, being solely a matter of collective-bargaining, made the answer to the question above-who gets to make and review decisions about teacher layoffs in the public schools-relatively simple and straightforward.

In 2011, this all changed when, for the first time in Michigan history, the Legislature exercised its constitutional role and decided that the Legislature and local school boards, not the unions or administrative agencies, would decide which teachers should be retained and which should be laid off in the event of a reduction in force. The key to this historic change was to remove the subject of teacher layoffs from the realm of collective bargaining. Doing so had the twofold effect of: (1) removing the unions as a decision maker on layoff-related issues; and (2) by definition, making it unnecessary for MERC to review layoff-related cases because they no longer implicated public-sector labor laws.

To implement this dramatic shift in the law of teacher layoffs, the Legislature also mandated that Michigan's several hundred school boards make layoff decisions based on merit, through the development of a mandated, comprehensive evaluation system for public school teachers. To make it perfectly clear that these decisions would be made by the local school boards, and not be sidetracked by administrative agencies, the Legislature took the additional and somewhat unusual precaution of explicitly saying how and by whom the layoff decisions could be reviewed.

As stated above, MERC obviously would no longer have reason to address this subject, and thus assert jurisdiction. And because the State Tenure Commission ("STC") had, prior to the 2011 Amendments, asserted jurisdiction over a few teacher-layoff suits-wrongfully, in our view, and based on a now non-binding 1975 decision of our Court-the Legislature again took the unusual, but prudent precaution of amending the Teacher Tenure Act ("TTA")[7] to remove the slim statutory basis which the STC claimed gave it jurisdiction over layoff-related actions. Finally, to make it absolutely clear that no administrative agency may review a school board's layoff decisions, the Legislature provided that a teacher's "sole and exclusive remedy" is to appeal the decision to the courts.

In sum, the 2011 Amendments affected a massive redistribution of power in the realm of teacher layoffs-from teacher unions to the local school districts as decision-makers, and from administrative agencies to the courts as the only recourse to review challenged layoff decisions.


In these appeals, petitioners essentially seek to unmake the 2011 Amendments through a seldom used and non-binding 1975 decision of our Court that, prior to the 2011 Amendments, gave the STC a minor and narrow role in reviewing teacher layoffs.

Under the TTA, the STC had no legal authority to adjudicate layoff-related disputes, because as an administrative agency, the STC's powers are limited to those expressly granted by the Legislature.[8] And, in the TTA, the Legislature granted the STC jurisdiction only over the discharge and demotion of teachers-not the layoff of teachers. Nonetheless, citing the aforementioned 1975 decision, the STC, in a few rare instances, improperly exercised jurisdiction over cases that involved the layoff of teachers by essentially characterizing a layoff as a discharge. As we said above, because the Legislature wished the 2011 Amendments to be implemented without this sort of administrative agency interference, it amended the TTA to underscore that the subject of layoffs is no longer within the STC's limited reach of jurisdiction.

The seasoned lawyers who act as administrative law judges ("ALJs") for the state Department of Education adjudicated these cases, correctly, by holding what is obvious: the STC no longer has any warrant to address layoff-related disputes. However, the political appointees who comprised the STC when it heard these appeals[9] could not bring themselves to comply with this clear legislative fact. Instead, the STC inexplicably ruled that it had jurisdiction over teacher layoffs, using the 1975 decision of our Court that the 2011 Amendments rendered null and void.

By the simple expedient of claiming jurisdiction to adjudicate hundreds of layoffs under a specious theory, the STC, surely, if upheld, would preclude any school district from making the merit-based layoffs required under the 2011 Amendments. By this "legal" sleight of hand, the STC also attempted to ensure that it, not the courts, would review layoff-related cases, in direct contravention of the legislative mandate to remove jurisdiction over these matters from administrative agencies, and give courts exclusive appellate jurisdiction. Indeed, to do this, the STC had to brazenly ignore the clear legislative mandate that a teacher's only appeal is to the judiciary.

We reject this unseemly power grab by the STC, and by doing so, reject its practical effect of overturning major, historic public-policy changes made by the people's representatives in the Legislature.


Petitioners, who initially numbered in the hundreds, are teachers who were laid off by respondents, their public-school-district employers. Respondents faced budgetary restrictions during 2011 and 2012, and accordingly reduced their staff sizes via the layoff methodology mandated by two sections of the School Code[10] enacted as part of the 2011 Amendments: MCL 380.1248 and MCL 380.1249. No longer having the protection of LIFO in labor agreements (and therefore losing MERC as an option to adjudicate their objections), petitioners' lawyers cited our Court's 1975 decision, and initiated these suits before the Michigan Department of Education in 2012. In each case, the ALJs-seasoned and experienced lawyers-rejected petitioners' claims and granted respondents summary judgment. Specifically, each ALJ correctly ruled that the 2011 Amendments to the TTA and School Code made very clear that the STC lacked jurisdiction, and that those claims could only be heard by the court system.

The petitioners in each case appealed the ALJs' decisions to the STC, and its political appointees (again, from a prior administration) rejected the ALJs' holdings in a series of orders entered in late 2012 and early 2013. The STC asserted that Michigan case law, which predated the 2011 Amendments, gave it jurisdiction over layoff claims that asserted "subterfuge, " and that the 2011 Amendments did not revoke this jurisdiction. One commission member dissented, and agreed with the conclusion of the ALJs that the STC did not possess jurisdiction over layoff cases.[11] Each STC order is interlocutory-it remands the cases to the ALJs that first heard them.

Respondents appealed the STC orders to our Court in early 2013, and ask us to reverse them because the STC does not have jurisdiction over layoff-related cases. Petitioners assert that the STC has jurisdiction over layoff-related cases, and that our Court does not have jurisdiction to review these interlocutory orders of the STC. We consolidated petitioners' and respondents' appeals in April and May of 2013 for administrative reasons.[12]

These appeals therefore present two issues, both of which involve jurisdiction: (1) does our Court have jurisdiction to review interlocutory orders of the STC; and (2) did the STC wrongly assert that it has jurisdiction over ...

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