16 CIR 499 (2011)


                                  Petitioner, ) (FINAL ORDER)
         v. )  
Municipal Corporation, )  
                                  Respondent. )

Entered April 4, 2011


For Petitioner: Gary L. Young
Anne E. Winner
Keating, O'Gara, Nedved & Peter, P.C. L.L.O.
  530 South 13th Street
  Suite 100
  Lincoln, NE  68508
For Respondent: A. Stevenson Bogue
  Abigail M. Moland
McGrath, North, Mullin & Kratz, P.C., L.L.O.
  First National Tower
1601 Dodge Street
  Suite 3700
  Omaha, NE  68102
  Don W. Taute
  Lincoln Assistant City Attorney
  555 South 10th Street
  Suite 300
  Lincoln, NE  68508

ORR, C. 

Before:  Commissioners Orr, Blake, and Lindahl


The Public Association of Government Employees (hereinafter, “Petitioner”) filed a wage petition on August 9, 2010, seeking resolution of an industrial dispute for the September 1, 2010 through August 31, 2011 contract period. The Association is a labor organization formed by certain employees employed by the City of Lincoln (hereinafter, “Respondent” or “City”) for the purpose of representation in matters of collective bargaining.  


            The parties submitted to the Commission a joint stipulation with regard to the array of cities to compare to the City of Lincoln. See Exhibit 1. The parties used the seven-city array of Des Moines, IA; Omaha, NE; Madison, WI; Overland Park, KS; Sioux Falls, SD; St. Paul, MN; and Wichita, KS. The Commission does not set aside stipulations of the parties and certainly does not “seek” array members to supplement an agreed-to array by the parties. The parties have approved the above seven-city array; the wages that result from that array are agreed to by the parties. The Commission does not make any findings with regard to those increases or decreases in wages resulting from the parties’ agreement.  


The parties cannot come to agreement on three issues, and those issues will be resolved by decision of the Commission. Those three issues are: dental insurance, pension plans, and overtime payment methods.

Dental Insurance

            The Petitioner argues that the provision of dental insurance for employees is prevalent in the array of comparators and therefore the Commission should require the City to provide a comparable benefit to the bargaining unit employees. The Respondent argues that employee-paid dental insurance is not prevalent in the array market and should be eliminated or in the alternative offered at the employee’s cost.

            The issue in this case revolves around the array cities of Madison, WI and St. Paul, MN.  The Petitioner argues that Madison provides employer-paid dental care to its employees because one of the four health plans offered to the employees, offers a 100% employer-paid dental plan. The Respondent argues that Madison does not have an “overall” employer-paid dental plan because it is not offered in all of the health plans. The Respondent’s expert witness testified that the plan (that has dental insurance) covers only 26% of Madison’s total employees. Madison does not have a freestanding employer-paid dental care plan comparable to the plan offered in Lincoln. Since the majority of employees do not utilize this plan and the plan is not similar to Lincoln’s freestanding plan, the Commission determines that the weight of the evidence indicates that Madison does not have a similar dental plan and that Madison should be counted as a “no” with regard to employer-paid dental.

            With regard to the array city of St. Paul, MN, the evidence presented at trial indicates that the majority of the employees are offered a “preventative care” type dental plan. The plan is however, not completely similar to the plan that provides preventative care as well as other dental care at Lincoln. While the plan at St. Paul provides a larger portion of the Lincoln “model” employer-paid dental by offering preventative care, it is not as easily categorized as the other array cities. Since the plan is a “hybrid” plan offering some employer paid dental insurance but not all employer-paid dental insurance, the Commission declines to label the city of St. Paul as a “yes” or a “no” in Table 1.

Leaving St. Paul out of the array modal calculation, the Commission arrives at a bi-modal result with three (3) “yes” array cities and three (3) “no” array cities. Therefore, following past Commission case law, a bi-modal result in a prevalancy analysis results in Lincoln maintaining their current practice of providing dental insurance at the current percentages of employer/employee-paid dental insurance. The Respondent will continue to provide employer-paid dental insurance at its current rate of 50% for family coverage and 50% for single coverage.

Pension Plans

The Petitioner argues that it is prevalent in the market for the Respondent to provide a defined benefit pension plan with mid-point benefits as set forth in Exhibit 5, rather than the Respondent’s current method of providing a defined contribution plan. Even though the Commission has declined to look at retirement plans in the past, the Petitioner reasons that since Neb. Rev. Stat. § 48-818 contemplates the Commission’s obligations to consider overall compensation, the Commission must order comparable benefits, including ordering the City to provide a defined benefit pension plan. The Respondent argues after a review of past Commission decisions, the Commission clearly lacks jurisdiction to make the proposed change suggested by the Petitioner to the Respondent’s pension plan. Without jurisdiction to make the requested changes to the pension plan, the Respondent argues that no changes should be made to the current pension offerings.

The pension plan is in the nature of a long-term contract which extends beyond the 1-year period over which the Commission had jurisdiction in this case. The Commission has no general jurisdiction over contractual disputes. See Transport Workers of America v. Transit Auth. of City of Omaha, 205 Neb. 26, 286 N. W. 2d 102. While the Commission may have jurisdiction to offset favorable and unfavorable comparisons of prevalent pension practices when reaching its decision to establish wage rates, the Commission lacks jurisdiction to order structural changes to pension plans. Douglas Cty. Health Dept. Emp. Ass’n v. Douglas Cty., 229 Neb. 301, 422 N.W.2d 28 (1998). Changes to pension plans, such as in the pay subjects used to calculate the rate of contribution, whether a plan is set up as a defined benefit or a defined contribution, age of retirement, and measurement period all clearly have a structural impact on the pension plan and, according to previous case law decided by the Nebraska Supreme Court, are not under the statutory framework of the Commission. See City of Omaha v. Omaha Police Union, Local 101, 16 CIR 120 (1998).

The Petitioner proposes changes to the Respondent’s pension plan, by adding another pension plan (a defined benefit plan). This is a structural change, extending years beyond the contract in question. The Commission lacks jurisdiction to order such a change. Therefore, the Commission will not order any change to the Respondent’s pension plan.

Overtime Payment Method

The Petitioner requests that the Commission determine the Respondent’s overtime calculation method (when overtime begins in an employees work cycle), because such a practice is fundamentally related to wages, hours and conditions of employment. The Petitioner argues that when overtime begins in a work cycle is a matter of employee wages, and does not involve employer policy or value choices. The Petitioner maintains that when overtime begins is not a management prerogative but is instead a mandatory subject of bargaining. The Respondent submits that overtime is a management prerogative, outside the jurisdiction of the Commission.

There are three categories of collective bargaining subjects: mandatory, permissive, and prohibited. International Union of Operating Engineers Local 571 v. City of Plattsmouth, 14 CIR 89 (2002). aff’d. 265 Neb. 817 (2003). The Industrial Relations Act only requires parties to bargain over mandatory subjects. Neb. Rev. Stat. § 48-816(1). The Commission in Service Employees International Union, Local No. 226 v. School District No. 66, 3 CIR 514 (1978), used a relationship test in determining bargaining issues. “Whether an issue is one for bargaining under the Court of Industrial Relations Act depends upon whether it is primarily related to wages, hours and conditions of employment of the employees, or whether it is primarily related to formulation or management of public policy.” Id. at 515; See also Coleridge Education Ass’n v. Cedar County School District No. 14-0541, a/k/a Coleridge Community Schools, 13 CIR 376 (2001).

As stated in Omaha Police Union Local 101, a condition of employment should have an effect and an economic impact on the employee’s job assignment. It does not include certain subjects normally considered prerogatives of management, such as business schedules, company policy, plant locations, and supervisors. In Omaha Police Union Local 101, the Commission also quoted the NLRB decision of Fiberboard Paper Products Corp. v. N.L.R.B., 379 U.S. 203, 50 LC 19, 384, which states the Supreme Court said that "nothing the court holds today should be understood as imposing a duty to bargain collectively regarding such management decisions which lie at the core of entrepreneurial control..." Additionally, some subjects are considered management prerogatives and may generally be altered at the will of the employer. See, Metropolitan Tech. Community College Educ. Ass'n v. Metropolitan Tech. Community College Area, 203 Neb. 832, 281 N.W.2d 201 (1979) (holding in a school case that the following subjects are management prerogatives: the right to hire; to maintain order and efficiency; to schedule work; to control transfers and assignments; to determine what extracurricular activities may be supported or sponsored; and to determine the curriculum, class size, and types of specialties to be employed).

The distinction between the different categories of bargaining subjects is important, because rules stated below allowing parties to bargain in good faith to impasse and then to unilaterally implement changes, apply only to mandatory bargaining subjects and management prerogatives.  

The issue of whether overtime and the scheduling of hours worked is a management prerogative has been decided by the Commission a number of times. See Lincoln Firefighters Ass’n Local Union No. 644 v. City of Lincoln, 12 CIR 248 (1997), Aff’d. 253 Neb. 837, 572 N.W.2d 369 (1998) (Hours of work per cycle and overtime are management prerogatives); Fraternal Order of Police Lodge No. 81 v. City of Grand Island, 14 CIR 81 (2002) (Overtime practices are management prerogatives and the CIR should not limit management authority); General Drivers and Helpers Union, Local 554 v. County of Gage, 14 CIR 170 (2003) (Number of hours worked per day and per week determined to be management prerogatives, including overtime); and International Ass’n of Firefighters, Local Union No. 647 v. City of Grand Island, 15 CIR 324 (2007) (Commission declined to address overtime policies, as overtime falls under hours worked in a day and week, or a scheduling procedure,  so therefore a management prerogative). The Commission has also held work cycle is a management prerogative under County of Hall v. United Food and Commercial Workers, Local 222, 15 CIR 167 (2006).

Furthermore, the Commission may look to the National Labor Relations Board for guidance, as to issues not definitively settled in Nebraska.  Norfolk Educ. Ass’n v. School Dist. of the County of Madison, a/k/a Norfolk Public Schools, 1 CIR 40 (1971) & (1973). Nevertheless, the National Labor Relations Board is guidance, not controlling, and does not override areas decided by the Commission, the Nebraska Supreme Court, or statutorily mandated by the Nebraska Legislature.  Under NLRB rulings, overtime would be treated as a mandatory subject of bargaining, but we have a long-standing line of decisions wherein we have determined it to be management prerogative. Therefore, overtime in the instant case is management prerogative and the Commission lacks jurisdiction to change the Respondent’s method of calculating when overtime begins during a work cycle.


1.   The Respondent shall continue to provide employer-paid dental insurance at its current rate of 50% for family coverage and 50% for single coverage.

2.   The Commission received Exhibit 1, the Parties' Joint Stipulation, including the details itemized by the parties in Exhibits A and B, and approves the same.

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.

4.  All other terms and conditions of employment are not affected by this Order. 

All commissioners join in the entry of this order.

To obtain a copy of Table 1, please contact the Commission of Industrial Relations at (402) 471-2934 or by e-mail at industrial.relations@nebraska.gov.