15 CIR 368 (2007) 

NEBRASKA COMMISSION OF INDUSTRIAL RELATIONS

 APPEARANCES:

Entered October 24, 2007.

Before: Commissioners Orr, Lindahl and Blake

ORR, H.C. 

NATURE OF THE PROCEEDINGS:

Louisville Education Association (hereinafter, “Petitioner” or “Association”) filed a wage petition on March 14, 2007, seeking resolution of an industrial dispute for the 2006-2007 contract year. The Association is a labor organization formed by teachers employed by Cass County School District No. 13-0032, a/k/a Louisville Public Schools (hereinafter, “Respondent” or “District”) for the purpose of representation in matters of employment relations. The District is a political subdivision of the State of Nebraska and a Class III school district.

JURISDICTION: 

The Commission has jurisdiction over the parties and subject matter of this action pursuant to Neb. Rev. Stat. §48-818 (Reissue 1998) which provides in part:

                        …the Commission of Industrial Relations shall establish rates of pay and conditions of employment which are comparable to the prevalent wage rates paid and conditions of employment maintained for the same or similar work of workers exhibiting like or similar skills under the same or similar working conditions…

ARRAY: 

The Association proposes ten school districts for its array. The District proposes that sixteen school districts be used in its array. The common array members are Wahoo, Bennington, Douglas County West, Syracuse-Dunbar-Avoca, Conestoga (Murray), Ashland-Greenwood, Weeping Water, Elmwood-Murdock, Yutan, and Palmyra. The contested array members proposed by the Respondent are Arlington, Raymond Central, Fort Calhoun, Malcolm, Freeman, and Tecumseh.

In determining a proper array, the parties agree that the work, skills, and working conditions of Louisville Public Schools’ teachers are sufficiently similar for comparison under Neb. Rev. Stat. §48-818 (Reissue 1998) to all common array members with the exception of Conestoga, where Respondent maintains that the work and working conditions are not sufficiently similar to permit a comparison, nor does the Petitioner agree that any of the additional array member school districts of Arlington, Raymond Central, Fort Calhoun, Malcolm, Freeman, and Tecumseh are comparable.

The Commission has held that if potential array members share similar work, skills, and working conditions, the Commission will include all of the schools submitted in the array unless there is specific evidence that to do so would be otherwise inappropriate or would make the array unmanageable. Geneva Educ. Ass’n v. Fillmore County School Dist. No 0075, 11 CIR 38 (1990); Lynch Educ. Ass’n v. Boyd County School Dist. No. 0036, 11 CIR 25 (1990). Even in such cases, the Commission does not disregard the size and geographic guidelines. See, Id. The Commission need not consider every conceivable comparable, but only “a sufficient number in a representative array so that it can determine whether the wages paid or the benefits conferred are comparable.” Nebraska Pub. Employees Local Union 251 v. County of York, 13 CIR 157 (1998).

Both the Petitioner and the Respondent agreed to the ten common array schools. All ten are in very close proximity and within the size comparison to Louisville. All ten schools will be included in the array. Ten array schools are sufficient to arrive at a comparable wage rate and the Commission need not include the other six array schools proposed by the Respondent. Therefore, the Commission’s array will consist of the common array members of: Wahoo, Bennington, Douglas County West, Syracuse-Dunbar-Avoca, Conestoga (Murray), Ashland-Greenwood, Weeping Water, Elmwood-Murdock, Yutan, and Palmyra.

CONTRACT DAY ADJUSTMENT:

            While both the Petitioner and the Respondent would like Conestoga to be included in the array, the Petitioner argues that Conestoga should be included in the array with 159 contract days. The Respondent argues that Conestoga should be included with 185 contract days.  

In West Holt Faculty Ass’n v. School Dist. No. 25, 5 CIR 301 (1981), the Commission concluded that adjusting contract days rather than adjusting compensation would be a better approach. West Holt quoted Neb. Rev. Stat. §48-818, which provides in part:

.... In establishing wage rates the Commission shall take into consideration the overall compensation received by employees, having regard not only to wages for time actually worked but also for time not worked ...

Under the unique facts of West Holt, the Association argued that the 182 contract days at West Holt had been unilaterally established by the District Board to accommodate farm families in the district. The Association concluded that therefore no salary adjustment should be made for a lesser number of contract days than prevalent among schools in the array. In analyzing the case, the Commission stated that the evidence showed that the number of contract days were unilaterally established by the Board to accommodate farm families, but noted the evidence proved that teachers’ salary expectations were related to the number of contract days. Therefore, in West Holt, the Commission found that an adjustment in basic salary was necessary by adjusting total salary schedule amounts for each of the schools in the array to 182 contract days.

In the instant case, a significant amount of evidence regarding Conestoga’s contract and schedule were presented at trial. Although the contract states that the number of contract days will not exceed 185 days, the parties, in their memorandum of understanding and testimony presented at trial, clearly agreed to implement a 4-day work week, contracting with the teachers to work 159 days. The testimony at trial indicated that the teachers at Conestoga were scheduled to work 159 days, but actually worked less than the 159 days. Based upon this specific evidence, the Commission determines that Conestoga should be adjusted in the computation of base salary using 159 days, rather than 185 days.

SUFFICIENTLY SIMILAR CASH OPTIONS:

            Cash-in-lieu of insurance has been an important issue in teacher wage cases since Educational Service Unit No.13 Educ. Ass’n v. Educational Service Unit No. 13, 14 CIR 1 (2002) and 14 CIR 34 (2002) (“ESU 13”). When array schools offer different amounts of cash-in-lieu of insurance the Commission has set forth a standard as seen in South Sioux City Education Ass’n v. Dakota County School Dist. No. 22-011, 15 CIR 37 (2004), which the school district must offer a cash benefit that is “sufficiently similar” to the option offered at the subject school.  

The parties to this case disagree on which cash options are sufficiently similar to the option offered at Louisville. Nine of the ten array schools offer varying amounts of cash-in-lieu of insurance. The Petitioner argues that the Commission should, for the array schools which offer cash-in-lieu of insurance that is at least equal to or greater than 70% of the subject school’s cash option amount, place the Louisville teachers on those schools’ schedules as receiving the cash-in-lieu amount. For those schools which offer less than 70% of the cash offered at Louisville, Petitioner argues that those teachers should be placed as receiving the health insurance benefit available to them (i.e. dependent insurance). Therefore, the Petitioner argues that only five of the nine schools that offer cash-in-lieu of insurance are sufficiently similar. Whereas, the Respondent argues that the Commission should determine that cash-in-lieu of insurance that is at least equal to or greater than 20% of the subject school’s cash option amount is sufficiently similar. The Respondent therefore argues that all of the nine array schools provide sufficiently similar cash options.

In ESU 13, the Commission looked at comparing an election at the subject school district to take the health insurance benefit as either family coverage, individual coverage plus cash, or all cash. The total benefit cost remained the same. Each employee could choose to take this benefit in cash, payment of various insurance premiums, or a mixture. In ESU 13, numerous depositions were offered to prove the reason a particular teacher in the unit made his or her choice, and what they might choose at a proposed array institution. We discouraged this practice, as it was apparent that this evidence was likely to be extremely costly, speculative and lacking in sufficient foundation.

In ESU 13, the question, as to those teachers who had taken a cash option, was how to compute their benefit at an array school which did not offer a cash option. The Commission was asked to calculate the cost of health insurance benefits by using the same elections the employees in question had actually made, and further, where there was no comparable election in the array school, to calculate the benefit received as zero. In concluding in ESU 13 that each employee would make an economically rational choice to accept the maximum fringe benefits available to the teacher, the Commission based its conclusion on an inference from the evidence presented.  

Next, in South Sioux City Educ. Ass’n, the Commission determined that the inference of economically rational choice of the greatest benefit should not be followed in placing those teachers who selected a cash option at the subject school when the cash option is sufficiently similar to the option offered at the subject school. In this case, the Commission found that the cash options offered at Blair, Elkhorn, and Hastings were sufficiently similar to the cash option at South Sioux City, while the cash option at Ralston was not sufficiently similar.

Finally, in Beatrice Educ. Ass’n v. Gage County School Dist. No. 34-0015, 15 CIR 46 (2004), the array schools of Norris, Waverly, Seward, Nebraska City, York, Gretna, South Central Nebraska Unified School District No. 5, and Aurora offered no cash option. The Commission placed the Beatrice teachers on those eight schools’ salary schedules as taking the maximum benefit available to them. In Beatrice Educ. Ass’n, the Commission concluded that if an array school provides a cash option to their teachers and that cash option was sufficiently similar to the subject school’s cash option, the Commission placed the subject school teachers as taking the cash option at the array school. If an array school did not offer a cash option, or that cash option was not sufficiently similar to the subject school’s cash option, the Commission placed the subject school’s teachers as receiving the maximum insurance benefit for which they are qualified (dependent or individual coverage).

In the instant case, Louisville offers $4,209 in cash. The array schools offer varying cash amounts. See Table 1. In both South Sioux City Educ. Ass’n and Beatrice Educ. Ass’n, the Commission applied the standard that a school had a “sufficiently similar” cash option if that cash option was 50% or greater than the subject school’s cash option. Here, we conclude that if an array school provides a cash option to their teachers, and that cash option is sufficiently similar to the subject school’s cash option (equal to 50% or greater), we will place the subject school teachers as taking the cash option at the array school. For example, thirteen teachers at Louisville took the cash option. So, if the array member’s option is 50% or greater than Louisville’s cash option ($4,209 or 50% $2,104.50 or greater), (i.e. Bennington, Palmyra, Wahoo, Weeping Water and Yutan), then the thirteen teachers are placed as receiving the array school’s actual cash option. Therefore, the Commission will place teachers at Bennington, Palmyra, Wahoo, Weeping Water and Yutan as receiving the subject schools cash option. See Tables 2 and 3.

If an array school does not offer a cash option, we will place the subject school’s teachers as receiving the maximum insurance benefit for which they are qualified (dependent or single coverage). For example, Conestoga does not offer a cash-in-lieu of insurance amount, so the thirteen teachers are placed as receiving the full benefit of Conestoga’s dependent insurance. Therefore, the teachers are placed as receiving $11,825.28 at Conestoga.

If the array school offers the same benefit for all the options (single, dependent, or cash), then the Commission will place the teacher as receiving the cash option. For example, DC West and Syracuse offer $6,000 for single insurance, dependent insurance, and cash, so the Louisville teachers are placed as all receiving $6,000. Therefore, on the worksheets for DC West and Syracuse all teachers are placed as receiving $6,000.

However, there is still the issue of placement when the array school offers a cash option but that option is not sufficiently similar.  If there were schools in which the cash option offered was less than 50%, the Commission’s South Sioux City Educ. Ass’n methodology gave those teachers the full benefit of dependent or single coverage, whichever they were eligible for. For example, in the instant case dependent coverage in Ashland-Greenwood would be $11,825 and in Elmwood-Murdock $12,404, and the thirteen Louisville teachers would be placed as taking full dependent coverage. This method does not take into consideration the fact that even though the cash option is not sufficiently similar, a small percentage of teachers may still take the cash option. It could be argued that this current methodology slightly inflates the total compensation figures. The facts of this particular case force us to consider the fairness of economically rational choices. To promote a final determination of predictability, logic and fairness, developed over several cases, we determine in the instant case that placing teachers as receiving the full dependent benefit unfairly inflates the total compensation figures. Given the facts of this case, as well as the evolving nature of health insurance and health insurance premiums, the Commission needs to further define the process by which it should fairly place teachers in non-similar cash option array schools. This developed methodology would place teachers as receiving the cash option of $4,209 (Louisville’s cash amount) at the non-similar cash option array schools, rather than the full dependent insurance amount offered at that school. Therefore, if the cash offered at the array school is less than 50%, the subject school teacher would be placed on the array school’s salary schedule as receiving the cash offered at the subject school. See Tables 4 and 5.

CONTRACT DELETIONS:

The Respondent requests deletion of various contractual provisions. See the parties Joint Pretrial Report and Disclosure D (3) through (11). The Petitioner argues that all seven requests for deletion are moot. This Commission has continually refused to rule on certain fringe benefits when the contract year has passed. See South Sioux City, 15 CIR 23 and 15 CIR 37 (2004). Any dispute over benefits other than total compensation, base salary, and employer contributions towards fringe benefits are moot for the 2006-2007 contract year.

BASE SALARY:

Table 6 sets forth the relevant information for determining the appropriate base salary. The midpoint of the total compensation $2,166,985 minus the cost of fringe benefits of $344,829   equals $1,822,156 which, when divided by the new total staff index factor of 66.1650, equals a base salary of $27,540 for the 2006-2007 school year.

IT IS THEREFORE ORDERED THAT:

1.      The Respondent shall pay the teachers a base salary of $27,540 for the 2006-2007 school year.

2.      All other terms and conditions of employment for the 2006-2007 school year shall be as previously established by the agreement of the parties and by the Findings and Order of the Commission.

3.      Adjustments in compensation resulting from this order shall be paid in a single lump sum payable within thirty (30) days of this final order, if possible. 

All commissioners join in the entry of this order.