State v. American Federation of State

2012 NMCA 114, 3 N.M. 43
CourtNew Mexico Court of Appeals
DecidedAugust 8, 2012
Docket33,792; Docket 30,847
StatusPublished
Cited by9 cases

This text of 2012 NMCA 114 (State v. American Federation of State) is published on Counsel Stack Legal Research, covering New Mexico Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State v. American Federation of State, 2012 NMCA 114, 3 N.M. 43 (N.M. Ct. App. 2012).

Opinions

OPINION

FRY, Judge.

{1} Appellees American Federation of State, County, and Municipal Employees, Council 18 (AFSCME) and Communication Workers of America (CWA) (collectively, the Unions) represent two groups of classified employees who work for the State of New Mexico. In fiscal year 2009 (FY2009), the State implemented salary increases for its classified employees that differed from those required by collective bargaining agreements previously executed by the State and the Unions. Each Union reacted by filing grievances that were ultimately submitted to arbitration for resolution. The arbitrators determined that the State’s pay package for FY2009 violated the terms of the agreements and accordingly issued awards in favor of the Unions. The State appeals from the district court’s confirmation ofthe arbitration awards, arguing that the district court employed an improper standard of review and that the arbitrators acted in excess of their authority. We affirm.

BACKGROUND

Terms of the Agreements

{2} In September 2005, AFSCME and CWA each entered into a collective bargaining agreement (collectively, the Agreements) with the State that covered, in relevant part, contractual salary increases for three fiscal years, ending in FY2009. This appeal specifically concerns two contractual salary increases for FY2009 required by the Agreements. The first of these contractual salary increases provided a two percent general salary increase subject to “the Governor’s Recommendation” for employees in each Union’s bargaining unit that was to be effective the first full pay period following July 1, 2008. The second salary increase was “[sjubject to legislative appropriation” and was a compa-ratio based within-band salary increase that was to be effective the first full pay period following January 1, 2009. Both Agreements were identical with respect to these two contractual salary increase provisions. In addition, the Agreements provided that:

In the event the salary increases described [above] are not implemented because the [Legislature fails to appropriate sufficient funds in any fiscal year, the Union[s] ha[ve] the right to reopen bargaining over general salary and within band [salary] increases that would be effective for the fiscal year following the fiscal year in which the [Legislature fails to appropriate sufficient funds[.]

The Agreements included grievance and arbitration provisions to be followed by the parties in the event of an alleged violation, misapplication, or misinterpretation of the Agreements.

{3} The Union-represented employees constituted a subset of all classified employees working for the State in FY2009. During the 2008 legislative session at issue in this case, it is undisputed that the Legislature would have needed to appropriate approximately $8 million to fund the two salary increases required by the Agreements — $5.8 million for employees within the AFSCME bargaining unit and approximately $1.9 million for the CW A bargaining unit employees. By contrast, the Legislature would need to appropriate approximately $15.9 million dollars in order to extend the two salary increases provided for in the Agreements to all eligible classified employees — both unrepresented workers as well as Union-represented employees.

Legislative Appropriations for FY2009

{4} The Legislature’s appropriation bill for FY2009 appropriated $12,833,000 “toprovide incumbents in agencies governed by the Personnel Act . . . with an average salary increase of two and four-tenths percent . . . based on employee job performance as determined by the personnel board.” (Emphasis added.) This increase was to be effective July 1, 2008. A second bill passed by the Legislature provided “an additional average salary increase of one-halfpercent” to be effective on July 1, 2008, that was to be paid by each state agency using its “cash balances, vacancy savings[,] and other available funds.” (Emphasis added.) This bill authorized the Department of Finance and Administration to distribute up to $500,000 of the appropriation contingency fund to those agencies that did not have available funds for the one-half percent salary increase.

{5} Following the legislative session, the State Personnel Office (SPO) contacted representatives of the Unions and informed them that it believed the Legislature had not appropriated sufficient funds to cover the salary increases required by the Agreements. Two meetings were held between the Unions and SPO to discuss the legislative appropriations and the pay package that SPO was planning to recommend to the Personnel Board. At the conclusion of the second meeting, the Unions requested an additional meeting and an opportunity to present a counterproposal to SPO’s planned recommendation. This request was denied, and the Personnel Board then approved and the State implemented a pay package for FY2009 that differed not only from the terms of the Agreements, but also from the pay package discussed by SPO and the Unions at the two meetings. The package that was implemented provided: “[a] salary increase of [two and four-tenths percent] of pay-band midpoint to incumbents in agencies governed by the Personnel Act” and “[a]n additional [one-halfpercent] of pay-band midpoint salary increase for incumbent employees subject to the Personnel Act.” This flat two and nine-tenths percent salary increase was effective July 1, 2008, and applied to all classified employees, including unrepresented and Union-represented employees.

Arbitration Proceedings

{6} Both AFSCME and CWA filed grievances with SPO following the implementation of the pay package for FY2009. The Unions’ primary argument was that even if the funding appropriated by the Legislature was insufficient to give all classified employees the two salary increases contracted for under the Agreements, there were nonetheless sufficient funds appropriated to fully fund the increases for Union-represented employees and still provide an “average” of two and four-tenths percent and an additional “average” of one-half percent in salary increases for all employees. The Unions also alleged that SPO had negotiated in bad faith by failing to give the Unions an opportunity to bargain over the pay package that was ultimately implemented by the State.

{7} Unable to resolve their disputes through the grievance process, the State and the Unions submitted to arbitration. Arbitration between AFSCME and the State occurred on March 27, 2009, before arbitrator Alvin Goldman. On June 15, 2009, Goldman issued an opinion and award in favor of AFSCME. Goldman determined that the State had not violated the first salary increase requirement of the AFS CME Agreement — the two percent increase effective on July 1, 2008 — because the pay plan implemented by the State for FY2009 provided an increase of two and nine-tenths percent on July 1, 2008. However, he determined that the State failed to provide the compa-ratio increases required by the AFSCME Agreement and, therefore, the total “received wage increases for bargaining unit employees were less than would have been received had the pay [package] conformed” with the requirements of the AFSCME Agreement. Goldman concluded that the $12.5 million dollars appropriated by the Legislature was “more than enough” to meet the State’s obligation to pay the AFSCME Agreement increases to Union-represented employees and “stillpermit smaller increases for non bargaining unit personnel.”

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Bluebook (online)
2012 NMCA 114, 3 N.M. 43, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-v-american-federation-of-state-nmctapp-2012.