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Decatur Public Schools v. Van Buren County Education Association

Court of Appeals of Michigan

March 17, 2015

DECATUR PUBLIC SCHOOLS, Respondent-Appellee,
v.
VAN BUREN COUNTY EDUCATION ASSOCIATION and DECATUR EDUCATIONAL SUPPORT PERSONNEL ASSOCIATION, Charging Parties-Appellant.

MERC LC Nos. 00-000123; 00-000124

Before: Jansen, P.J., and Meter and Beckering, JJ.

Per Curiam.

Charging parties, Van Buren County Education Association and Decatur Educational Support Personnel Association, appeal as of right the January 21, 2014 decision of the Michigan Employment Relations Commission ("MERC") dismissing two unfair labor practice ("ULP") charges against respondent, Decatur Public Schools. We affirm.

I. PERTINENT FACTS AND PROCEDURAL HISTORY

A. PA 152

The facts in this case are largely undisputed and involve Van Buren County Education Association ("VBCEA"), which is a bargaining unit for teachers in Van Buren County, Decatur Educational Support Personnel Association ("DESPA"), a bargaining unit for support personnel, and the Decatur Public Schools. This case involves a public employer's contributions to its employees' health insurance costs, and whether the employer has a duty to bargain with regard to limits imposed on its contributions to employees' health care costs under 2011 PA 152, MCL 15.561 et seq., [1] the "Publicly Funded Health Insurance Contribution Act." PA 152 was given effect on September 27, 2011 and provides limits on the maximum amount that a public employer can contribute to medical benefit plans for its employees or elected public officials. Among other matters, PA 152 provided what the parties term "hard caps" for contributions to medical benefit plans for its employees. Section 3 of the act provides in relevant part:

Except as otherwise provided in this act, a public employer that offers or contributes to a medical benefit plan for its employees or elected public officials shall pay no more than the annual costs or illustrative rate and any payments for reimbursement of co-pays, deductibles, or payments into health savings accounts, flexible spending accounts, or similar accounts used for health care costs, than a total amount equal to $5, 500.00 times the number of employees and elected public officials with single-person coverage, $11, 000.00 times the number of employees and elected public officials with individual-and-spouse coverage or individual-plus-1-nonspouse-dependent coverage, plus $15, 000.00 times the number of employees and elected public officials with family coverage, for a medical benefit plan coverage year beginning on or after January 1, 2012. [MCL 15.563(1).]

In addition to the hard caps option set forth in section 3, a public employer, excluding the state, could elect to comply, "[b]y majority vote of its governing body" with section 4 of PA 152. The option provided in section 4 provided that a public employer "shall pay not more than 80% of the total annual costs of all of the medical benefit plans it offers or contributes to for its employees and elected public officials." MCL 15.564(2). Thus, subject to certain exemptions set forth in section 8 that are not applicable in the instant matter, PA 152 gave a public employer two options for contributing to the cost of medical benefit plans for its employees.

In enacting PA 152, the Legislature recognized that medical benefit plans may have been subject to existing collective bargaining agreements ("CBA"), and grandfathered in a public employer's contributions to medical benefit plans under existing CBAs; nonetheless, PA 152 mandated compliance with the act upon expiration of the previous of the CBAs. In this regard, section 5 of PA 152 provided:

(1) If a collective bargaining agreement or other contract that is inconsistent with sections 3 and 4 is in effect for 1 or more employees of a public employer on September 27, 2011, the requirements of section 3 or 4 do not apply to an employee covered by that contract until the contract expires. A public employer's expenditures for medical benefit plans under a collective bargaining agreement or other contract described in this subsection shall be excluded from calculation of the public employer's maximum payment under section 4. The requirements of sections 3 and 4 apply to any extension or renewal of the contract.
(2) A collective bargaining agreement or other contract that is executed on or after September 27, 2011 shall not include terms that are inconsistent with the requirements of sections 3 and 4. [MCL 15.565 (emphasis added).]
Section 9 of the act contained a penalty for failure to apply with the contributions limit:
If a public employer fails to comply with this act, the public employer shall permit the state treasurer to reduce by 10% each economic vitality incentive program payment received under 2011 PA 63 and the department of education shall assess the public employer a penalty equal to 10% of each payment of any funds for which the public employer qualifies under the state school aid act of 1979, 1979 PA 94, MCL 388.1601 to 388.1772, during the period that the public employer fails to comply with this act. Any reduction setoff or penalty amounts recovered shall be returned to the fund from which the reduction is assessed or upon which the penalty is determined. The department of education may also refer the penalty collection to the department of treasury for collection consistent with section 13 of 1941 PA 122, MCL 205.13. [MCL 15.569.]

B. UNFAIR LABOR PRACTICE CHARGE BY VBCEA

Charging party VBCEA and respondent are parties to a CBA that became effective on July 1, 2011, expiring on June 30, 2012. On or about May 14, 2012, before the first bargaining session on the new CBA, superintendent Elizabeth Godwin sent a memorandum to VBCEA members regarding their insurance premiums for the upcoming school year. The memorandum indicated that effective July 1, 2012, the day after the current CBA expired, respondent intended to implement a hard cap[2] on its contributions as set forth in PA 152. Godwin also sent letters to VBCEA members regarding the ...


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