Michigan Council 25 v. County of Wayne

364 N.W.2d 690, 140 Mich. App. 361

• Court: Michigan Court of Appeals
• Decided: December 12, 1984
• Docket: Docket No. 76086
• Status: Published

Opinion

Per Curiam.

Respondents appeal as of right from a finding by the Michigan Employment Relations Commission that they had engaged in unfair labor practices by unilaterally ceasing payment of cost-of-living allowances (COLA) during negotiations for a new collective-bargaining agreement. We affirm.

Petitioners filed this unfair labor petition with the commission when respondents refused to continue paying COLA benefits sometime after the expiration on June 30, 1982, of the parties’ collective-bargaining agreement. The agreement, effective from July 1, 1980, contained a COLA provision comparable to COLA provisions contained in predecessor agreements dating back to 1968. The COLA was paid by a quarterly check separate from regular paychecks and was calculated on an hourly basis according to changes in the Official Detroit Consumer Price Index. In previous negotiations, the parties had agreed to "roll in” part of the accrued COLA, i.e., add it to the base pay of each individual employee. The amount rolled in was then deducted from the quarterly payments. In May of 1982, just before expiration of the collective-bargaining agreement, the accrued COLA payment, after the deduction, was $1.86 per hour.

Following several communications between the parties, respondents agreed to pay quarterly COLA benefits through February of 1983. This petition was filed in May of 1983. The hearing referee held that the respondent was not required to continue COLA benefits because such benefits did not constitute wages or any other mandatory subject of bargaining. The hearing referee particularly relied upon the language of the collective-bargaining agreement obligating respondents to pay COLA benefits only "during the term of this agreement”.

On petitioners’ appeal, the commission rejected the hearing referee’s analysis and instead framed the critical inquiry in this and in future COLA cases to be "whether the evidence supports a determination that the COLA payment is an established condition of employment”. After considering the evidence introduced at the hearing in this case, the commission concluded that the parties, "by their consistent practice over an extended period of time, have established the payment of the accrued COLA as a condition of employment”.

We hold that the commission applied the correct legal standard to factual findings which are supported by competent, material and substantial evidence on the whole record and we affirm. Const 1963, art 6, § 28; MCL 423.23(2)(e); MSA 17.454(25)(2)(e); MERC v Detroit Symphony Orchestra, Inc, 393 Mich 116, 121; 223 NW2d 283 (1974). We rely for primary authority upon a recent decision of this Court reviewing the same legal question. In Local 1467, International Association of Firefighters, AFL-CIO v City of Portage, 134 Mich App 466; 352 NW2d 284 (1984), we held that, where COLA benefits are periodic, established by a formula and significantly impact the employee, those benefits will be considered "wages, hours and other terms and conditions of employment” within the meaning of MCL 423.215; MSA 17.455(15). Accordingly, a public employer engages in unfair labor practices as a matter of law by terminating COLA benefits upon the expiration of a collective-bargaining agreement prior to the parties reaching an impasse. Portage, p 473. We note that in formulating the appropriate legal standard for the commission’s treatment of COLA cases, this Court in Portage cited the commission’s decision in the instant case.

Respondents’ request for prospective application of the legal standard announced in Portage and in the commission’s decision in this case is unfounded inasmuch as these cases do not announce a new rule of law. Gussler v Fairview Tubular Products, 412 Mich 270, 298; 315 NW2d 388 (1981).

Affirmed.