|OMAHA EDUCATION|||||CASE NO. 178|
|v.|||||OPINION AND ORDER|
|THE SCHOOL DISTRICT OF OMAHA,||||
|In the County of Douglas, the||||
|State of Nebraska, a Political||||
Theodore L. Kessner for Plaintiff.
David M. Pedersen for Defendant.
Before: Judges Kratz, DeBacker, and Green.
The Omaha Education Association and the School District of Omaha have been unable to reach agreement as to the terms and conditions of employment for teachers in the Omaha District during the academic year 1976-1977. For that reason, the Association has brought the dispute here.
Since this is a teachers case, exhaustion of the Nebraska Teachers Professional Negotiation Act is a condition of our jurisdiction. Section 48-810; Nebraska City Education Association v. The School District of Nebraska City , 2 CIR 116-1, 3 (1974). The Omaha District claims that the Teachers Professional Negotiation Act has not been exhausted.
The Association's response is to contend that we have no authority to examine the substantive course of bargaining between the parties to determine whether or not there has been compliance with the Teachers Professional Negotiation Act. The Association finds support for that position in Sidney Education Association v. School District of Sidney , 189 Neb. 540, 203 N.W. 2d 762 (1973), which held that we could not enter a bargaining order against a school district covered by the Teachers Professional Negotiation Act, which had refused to recognize the Association representing its teachers.
The Association's reliance on Sidney Education Association is wide of the mark. We have expressed doubts as to whether that decision would limit our powers in a situation in which the parties had begun to utilize the process of the Teachers Professional Negotiation Act and then had aborted the process. Nebraska City Education Association v. The School District of Nebraska City , supra. In any event, exhaustion is a pre-condition to our jurisdiction under 48-810. Even if we could not order the parties to continue the process prescribed by the Teachers Professional Negotiation Act, if remedies under that Act had not been exhausted, we would be required to refuse to entertain the case, since it would not be ripe for adjudication by us. Thus, once the parties have begun to utilize the remedies provided by the Teachers Professional Negotiation act, Section 48-810 requires that we independently determine that those remedies have been exhausted before assuming jurisdiction over a case which arises under the Teachers Professional Negotiation Act. Nebraska City Education Association v. The School District of Nebraska City , supra.
We must, therefore, address the merits of the Omaha District's jurisdictional objection. That objection arises in the following circumstances. The dispute between the parties went to fact finding. The fact finders issued their decision. The procedure of the Association was to submit the factfinder's recommendation to its total membership for acceptance or rejection. The Association made its submission to the members in the form of a memorandum, which reported the fact finders' decision. While that memorandum correctly stated the terms which the factfinders had recommended, when those terms were translated into a percentage, the memorandum stated that the recommendation "represents a total increase in salary and fringe benefits of 5.34%," when in fact the increase in both Omaha District claims that the Association failed to give "good faith" consideration to the factfinders' recommendation as required by Section 79-1293. The Association responds by pointing out that the 5.34% figure represents the salary increase when computed in the manner that the Association customarily computes such increases and that it has been the Association's practice to report the percentage of salary increments to its members, and not the percentage increment in the cost of the total salary and benefit package.
The notion of good faith has a long history in the law of labor relations. In the usual context in which it is used, the requirement of good faith in bargaining, it simply imports an honest willingness to bargain and the absence of a preconceived intention not to reach agreement. Southeast Community College Faculty Association v. Southeast Technical Community College , 3 CIR 173-1 (1976). When this concept is carried over into the Section 79-1293 context it requires that "each party...honestly examines his last negotiating position in the light of the recommendations, and ...determine whether or not the factfinding report provides a reasonable basis for settlement." Nebraska City Education Association v. The School District of Nebraska City , supra, p. 116-4.
If action by the membership of an association is required in order to accept or reject a factfinders' report, and the recommendations of the factfinders are so distorted in the report that the association's bargaining team makes to the members that the membership action is not really on the recommendations the factfinders made, then it is possible that we could find a want of "good faith" consideration of the factfinders' report. However, if the substance of the factfinders' report is transmitted to the membership, it is difficult to see how a finding of bad faith could be made. In this case, the substance of the report was transmitted. While the percentage figure given may be misleading, that is not sufficient to invalidate the submission to the members and their subsequent action. The terms the factfinders recommended were before the members, and they rejected them. The Teachers Professional Negotiation act requires no more. The remedies under that Act have been exhausted.
We turn then to the substantive issues, which divide the parties. At the start, we are met with the question of the appropriate school districts with which to compare the Omaha District in order to make our determination under Section 48-818. More particularly, the Omaha District argues that since there are other school districts in close geographic proximity to the Omaha District, that is, Bellevue, Millard, Papillion, Ralston, District 66, and Lincoln, we must utilize those districts in making our determination, and only those districts, since those districts are in the same labor market as the Omaha District. The Omaha District finds this limitation on the appropriate array of a comparable in our decision in Omaha Association of Firefighters, Local 385 v. The City of Omaha , 2 CIR 117-1 (1975) and in the Supreme Court's decision in the same case Omaha Association of Firefighters v. City of Omaha , 194 Neb. 436, 231 N.W. 2d 710 (1975).
The limitation, which the Omaha District attempts to abstract from our decision in the Omaha Firemen's case and from the Supreme Court's decision is not supported by either opinion. Thus, in our opinion, we noted that:
"As our opinion in Fremont Education Assn. v. The School District of Fremont , supra, demonstrates, the 1969 amendment to the C.I.R.A. which removed the reference to market area from the statute did not remove the market area concept from the statute. Rather, what the Legislature did in 1969 was on the one hand abandon an effort to define with particularity the geographic contours of a market area and on the other hand abandon geographic limitations on sources of evidence which could be utilized to prove market wage rates." Omaha Firefighters Case , supra, p. 117-10 n.1.
Similarly, in its opinion the Supreme Court stated:
"The Legislature, by virtue of the amendment, removed all restrictions on the labor market areas to be considered, and completely removed provisions restricting the comparisons to areas within the State of Nebraska. The Legislature recognized that virtually every city and public employer is distinct and different from every other city or employer in some material respects...." 194 Neb. 440.
The language which we have just quoted from our opinion and from the opinion of the Supreme Court demonstrates that we are not limited to utilizing employers in the same market area in making a wage determination under 48-818. Though, "the 'prevalent'...is to be found in the market area where the employer before the Court hires labor and in which the employees before the Court offer their services..., we are able to infer the market value of the services of employees before us from evidence of wages paid for comparable services in reasonably similar labor markets." Omaha Firefighters Case , pp. 117-10, 117-11. In other words, the restriction on the data which we may use is not a geographic restriction, nor are we bounded by a market area. The statutory standard is comparability. As the Supreme Court noted in its opinion, "Under Section 48-818, R.R.S. 1943, in selecting cities in reasonably similar labor markets for purposes of comparison in arriving at comparable and prevalent wage rates the question is whether, as a matter of fact, the cities selected for comparison are sufficiently similar and have enough like characteristics or qualities to make comparison appropriate." 194 Neb. 441, c.f., Crete Education Assn. v. School District of Crete , 193 Neb. 245, 252-253, 226 N.W.2d 752 (1975).
The Omaha District finds support for its reading of our decision in the Omaha Firefighters case from our emphasis of the fact that Omaha was the only employer of the services of firemen in the market area. However, there are other reasons which might cause us to use non-market area data. For example, while there might be more than one employer, the total number of employers might be inadequate to found an array sufficient to support a decision. See, International Brotherhood of Electrical Workers v. Board of Public Works, City of Fremont , 3 CIR 158-1 (1976). Similarly, the other employers in the area might be inappropriate sources of comparison because of differences between their circumstances and the circumstances of the litigating employer. In teachers pay cases, for example, we have required that districts utilized to set wages be of comparable size with the litigating district. Tecumseh Education Association v. The School District of Tecumseh , 2 CIR 119-1, 4 (1975). The situation involved in the Omaha Firefighters case, where the employer was the only employer of services in the market area, is one example of the type of situation where non-market area data would have to be used. However, contrary to the Omaha District's position, that example does not exhaust the class.
The Omaha District is the only Class V district in the state. The Lincoln district is a Class IV district. Bellevue, Papillion, Ralston, Millard and District 66 are all Class III districts. In making determinations of comparability, we have in other circumstances given weight to the legislative division of districts into classes. Thus, in cases involving Class I districts, we have based our decisions upon an array of other Class I districts from throughout the state, rather than utilizing districts of other classes, which were in geographical proximity to the Class I district involved in the case. Murray Education Association v. School District of Murray , 3 CIR 145-1 (1975); District 8 Elementary Teachers Association v. School District No. 8 of Dodge County (North Bend) , 2 CIR 95-1 (1974). In addition, we have held that, "a district twice the size of the litigating district is generally too large to form a proper member of a comparative array." Tecumseh Education Assn. v. The School District of Tecumseh , supra, p. 119-4. By a parity of reasoning, a district half the size of the litigating district would be too small. In 1975-1976, the Omaha District had a total enrollment of 57,823, the Lincoln district had 28,198 pupils, Bellevue had 10,214, District 66 had 8,672, Millard had 8,154, Papillion had 5,215, and Ralston had 4,286. Exhibit 8, Statistics and Facts About Nebraska Schools , Section II, Table 2. Thus, under our prior case law in teachers litigation, we would be justified in not considering any of the Nebraska districts, which the Omaha District offers. Clearly,under our cases, an array composed solely of those districts would be inappropriate.
There is an additional factor, which persuades us that we should reject the Omaha District's argument that we ought to limit our consideration to the Nebraska districts as to which it presented evidence. Those districts are arrayed on the Omaha District's Exhibit 11. Under our usual standards, we would set the salary level at the approximate mid-point of an appropriate array. Nebraska City Education Assn. v. The School District of Nebraska City , supra, p. 116-6. The mid-point of base salaries shown on that exhibit is approximately $8,500.00, the base salary in the Omaha District last year. Conversely, last year, the base salary in the Omaha District was higher than the base salary in any of the other districts on Exhibit 11. Thus, last year, the base in District 66 was $8,400.00, in Millard $8,100.00, in Ralston $7,950.00, in Papillion $8,000.00, in Bellevue $8,461.00, and in Lincoln $8,415.00. We believe these figures indicate that the Omaha District has served as the leader in the process of wage formation in the market area where it is located. It would appear that Omaha salaries are usually somewhat higher than salaries in the other districts. To utilize the salaries of those other districts as the sole basis for setting salaries in the Omaha District would, we fear, be roughly equivalent to measuring a dog by the length of his tail.
We do not say that the data from these other Nebraska districts is totally irrelevant. We have utilized Omaha data in cases involving much smaller employers. Building Service Employees, Local No. 226 v. Papillion School District No. 27 of Sarpy County , 3 CIR 144-1 (1975); c.f., International Brotherhood of Electrical Workers v. Board of Public Works, City of Fremont , 3 CIR 158-1, supra. Conversely, we have used much smaller employers than the litigating employer in order to assure balance in the data upon which we base a decision. Omaha Police Union, Local No. 1 v. City of Omaha , 3 CIR 121-1 (1975). By the same token, we think that at least some guidance can be obtained from the schools on Exhibit 11, though we decline to give them controlling weight.
Before turning to our own computations of appropriate salary, there is an additional matter raised by the Omaha District, which we must address. Dr. Jerome Sherman, an economist at Creighton University, testified as an expert witness for the Omaha District. Essentially, Dr. Sherman's testimony proceeded in two stages. In the first stage, Dr. Sherman testified that the wage level for any particular occupation in a community is a function of the general wage level prevailing in that community and that wages also vary as between communities as cost of living varies so that wages in an area with a higher cost of living will tend to be higher than in another area where the cost of living is lower. With this much of Dr. Sherman's testimony we have no difficulty. We recognized the existence of these economic factors in our opinion in the Omaha Firefighters case, supra, pp. 117-11, 117-12.
However, there is a second step in Dr. Sherman's evidence. He endeavors to determine the exact amount of variance to be expected between rates of pay in different school districts. He does this by utilizing three factors; median family income based upon the1970 census and per capita income figures for 1974 as evidence of different levels of wages, and a private cost of living reporting service as evidence of differences in cost of living. He then took each of these three factors, and for each member of an array of districts he regarded as comparable to Omaha he created an index number with Omaha as Base 100. That is, for example, he divided median family income in St. Louis by median family income in Omaha and then multiplied by 100 to produce an index number of 102.9. Similarly with per capita income, division of St. Louis' per capita income by Omaha's and then multiplication by 100 produced an index number of 105.8. Likewise, with the inflation rate, the third quarter 1976 rating for St. Louis was divided by the Omaha rating and then multiplied by 100 to produce an index number of 107.1. See, Omaha District's Exhibit 19. These index numbers were then multiplied by 100 to produce an index number of 102.9. Similarly with per capita income, division of St. Louis' per capita income by Omaha's and then multiplication by 100 produced an index number of 105.8. Likewise, with the inflation rate, the third quarter 1976 rating for St. Louis was divided by the Omaha rating and then multiplied by 100 to produce an index number of 107.1 See, Omaha District's Exhibit 19. These index numbers were then used as deflation or inflation figures, depending upon whether the particular district was higher or lower on the index than Omaha, to convert salary or total teacher compensation for that district to what Dr. Sherman regarded as an appropriate base. For example, on Exhibit 37, he divides the actual cost of the St. Louis salary schedule to the Omaha District's of $37,806,500 by the index number 102.9 to produce what he denominates a salary schedule corrected for cost of living difference of $36,741,011. In other words, he assumes that if the cost of living in St. Louis is 2.9% higher than the cost of living in Omaha, then teacher salaries in St. Louis should be 2.9% higher than teacher salaries in Omaha. He then used this deflated data to justify the Omaha District's last offer to its teachers.
It is at this point, that we begin to have difficulties with Dr. Sherman's testimony. That a higher level of wages will produce higher wages in a particular occupation, may be true. However, Dr. Sherman offers no evidence that the difference between wage levels for particular occupations as between communities will vary in exactly the same percentage as median family income or per capita family income. Similarly, that wages will tend to be higher in a community with a higher cost of living, may be true. However, Dr. Sherman offers no evidence that the difference between wage levels for two occupations in different communities will vary in exactly the same percentage as the difference in percentage between the cost of living in the two communities. Indeed, Dr. Sherman specifically negated any such implication. Thus, on examination by the Court, he testified:
"The Court:...You don't purport to be offering your testimony as evidencing a model of the process of wage formation that could be used to predict wages in cities on the basis of the relationship between cost of living as represented by ACCRA figures, median family income, or per capita income in those communities, do you?
The Witness: I am saying that everything is relevant and if you pick other cities, in my judgment, Omaha has a lower wage-prevalent wage and a lower cost of living, therefore, in my judgment teachers' salaries being relevant should be less than in other areas.
The Court: For example, you would not go the other way and, if I told you the wages for carpenters in Omaha were $2.00 an hour and in your index basis of Omaha is 100 and St. Louis is, say 100.06, you would not then immediately predict a carpenters' wage rate in St. Louis for $2.12 an hour?
The Witness: No, I would not predict that.
The Court: You would only predict that it would probably be somewhat higher?
The Witness: That's right
The Court:...But it would not be a direct correlation?
The Witness: That is right." (Transcript 215-217).
In a nutshell then, Dr. Sherman testifies that salaries as between communities will vary because of certain factors such as wage levels or cost of living. However, he does not demonstrate that the variance of wage levels for particular occupations will bear any particular numerical relationship to the percentage difference in cost of living in two communities. However, he assumes the existence of a direct and equal correlation, when he uses his index numbers as deflators. Until some bridge is built between the generalization that wages are higher where cost of living is higher and the index numbers Dr. Sherman constructed, we do not believe it would be appropriate to utilize those index numbers in this case.
In addition to Dr. Sherman's own admission that he could not establish the direct and equal correlation between wage levels in two communities and salaries for a particular occupation in those communities, and between cost of living in two communities and salaries for occupations in those two communities, the evidence before the Court negates any such correlation. For example, though the Omaha District, District 66, Millard, Papillion, and Bellevue would appear to be in the same market area, salaries in the Omaha District last year were higher than in any of those districts. Conversely, if we adopted the Omaha District's proposal, the starting salary in Omaha would be lower than that in Council Bluffs. Similar situations obtain as between Minneapolis and St. Paul, which though contiguous have varying wage and benefit structures for teachers. Likewise, differences obtain as between Kansas City, Kansas and Kansas City, Missouri.
On the record before the Court, the utilization of Dr. Sherman's approach would require us to assume that simply because some relationship exists between wage levels and the wage levels for particular occupations, the relationship is exactly the one Dr. Sherman utilized. We are not prepared to leap from the generalization that some relationship exists to the particular relationship assumed by Dr. Sherman. While Dr. Sherman's testimony has the advantage of reducing comparison to a mathematical operation, the mathematics in which he engages is not supported by any evidence that it measures the real relationship between the variables involved. In the absence of such evidence, we believe qualitative judgments, which take account of differences in circumstances but do not assume that those differences may be reduced to numerical ratio, provide a more appropriate method for setting wages in this case.
More generally, we believe the Omaha District in its reliance upon Dr. Sherman's testimony has misunderstood the nature of the comparability standard contained in Section 48-818. That standard is an ordinal standard, not a cardinal standard. To be comparable, another district must have "enough like characteristics or qualities to make comparison appropriate." Crete Education Association v. School District of Crete , supra, 193 Neb. 253. If, however, "the cities selected for comparison are sufficiently similar and have enough like characteristics or qualities to make comparison appropriate", Omaha Association of Firefighters v. City of Omaha , supra, 194 Neb. 441, then a direct comparison is appropriate. In other words, the judgment mandated by 48-818 is a qualitative rather than a quantitative one. It requires us to utilize other employers, which are alike enough to make the comparison fair. It does not, however, contemplate that comparisons must be reduced to numerical ratios.
In our opinion in the Omaha Firefighters case, we noted that:
"The problem which this case presents is probably unavoidable. Unless the City of Omaha could be directly recapitulated throughout the United States, it is impossible to find an array of American cities which have a close congruity with Omaha in all social and economic factors which influence wage levels, while at the same time presenting similar firefighting conditions to those faced by Omaha firemen. We cannot require that the parties present us with data from cities in perfect congruity with Omaha, because such cities do not exist. At the same time, the incongruities in data prevent the utilization of the type of formula wage determination which we have been able to use in cases involving teachers." Omaha Firefighters case, supra, p. 117-14.
We went on to add that, "...the law cannot fix 'any single formula or combination of formulas.' Rather we must 'make the pragmatic adjustments which may be called for by particular circumstances.'" p. 117-15. The Supreme Court accepted our position that practical judgment rather than formula was the rule, when it noted with approval that, "It must be noted also that in this case the Court of Industrial Relations did not determine the prevalent wage rates for firemen by any direct computation or application of average or mean rates from seven cities nor from ten cities. Instead it weighed, compared, and adjusted all the factors involved in each of the cities, which resulted in a determination of prevalent wages paid for comparable services in reasonably similar labor markets." 194 Neb. 441.
We, therefore, reject the view that the type of mathematics in which Dr. Sherman engaged constitutes a method by which we can directly set wages. "Our task...is to appraise most carefully the value of work and skills performed under the working conditions shown, balance the interests of the plaintiff with the interests of the public at large, and thus arrive at a fair compensation." Local Union No. 647, International Association of Firefighters v. City of Grand Island , 3 CIR 142-1 (1975). In making that judgment of fair compensation, however, we will remain cognizant of factors such as difference in wage levels and difference in cost of living, and utilize figures from outside of Nebraska with caution designed to assure "that our error, if any, would be on the side of conservatism." Omaha Police Union, Local No. 1 v. City of Omaha , supra, 3 CIR 10; c.f., Omaha Association of Firefighters, Local 385 v. City of Omaha , supra, pp. 117-16, 117-17.
With these preliminaries behind us, we turn to the task of setting an appropriate salary. In Exhibit 11, the Omaha District has presented us with an array of other Nebraska districts claimed to be comparable. As we have already noted, in the academic year 1975-1976, the Omaha District paid a higher base salary than any of the districts on Exhibit 11. The salaries in Omaha and in those other districts in 1975-1976 was arrived at by free bargaining. In this academic year, all of those districts have now resolved their salary disputes through bargaining. District 66 paid a starting salary of $8,400.00 in 1975-1976, see Association Exhibit 6, in 1976-1977 it will pay a starting salary of $8,800.00, Omaha District Exhibit 11. This represents an increase in salary between the two years of 4.76%. In 1975-1976, Millard paid a salary of $8,100.00, while this year it will pay a salary of $8,600.00. This represents a percentage increase of 6.17%. In 1975-1976, Ralston paid a salary of $7,950.00, while this year its start will be $8,400.00. This represents an increase of 5.66%. In Papillion the start last year was $8,000.00, while this year it will be $8,400.00. This represents an increase of 5%. In Bellevue the start last year was $8,461.00, while this year it will be $8,995.00. That represents an increase of 6.31%. Last year Lincoln paid $8,415.00, while this year its start will be $8,745.00. That is a 3.92% increase. The average increase among these districts was 5.25%. If this average percentage is applied to the start last year in Omaha, it would produce a starting salary in Omaha of $8,946.00.
The last offer of the Omaha District was $8,825.00. The utilization of that figure would produce an increase in salary over 1975-1976 of 3.82%. Given the pattern of wage increases in the districts, which the Omaha District claims are comparable, the last offer of the District is clearly too low. The teachers in the Omaha District are entitled to a wage increase at least equal in percentage to the 5.25% pattern of the districts arrayed on Exhibit 11. As we stated in Building Service Employees Local No. 226 v. Papillion School District No. 27 , supra, 3 CIR 59, "Districts claimed by the Papillion District to be comparable, though their 1974-1975 wages differed significantly, adopted a uniform pattern of approximately 10% increases in wages to service employees in the academic year 1975-1976. Thus, on the District's own evidence, for 1975-1976, a 10% increase would be in order.
We would also note that the Association's Exhibit 7, a list of Nebraska teachers' salaries for 1976-1977 demonstrates that wage increases on the order of 5% were the standard throughout the state this academic year. Thus page vi, Summary of Information, shows that for each of the four classes by which data is reported the average starting salary rose by at least 5%.
On Exhibit 13, the Association provided us with a list of Iowa schools in which the base salary is $9,000.00 or greater. While the bulk of these schools are in the more highly industrialized eastern portion of the state of Iowa, both Council Bluffs and Lewis Central, across the river from Omaha, have starting salaries of $9,000.00. This Iowa data provides additional grounds for treating an increase of at least 5% as justified.
In Exhibit 11, the Association offered us its proposed array of school districts for comparison, Denver, Des Moines, Kansas City, Missouri, Long Beach, Minneapolis, St. Paul, and Toledo. Of the members of this array, we believe that it would be appropriate to reject Long Beach, California. The distance to Long Beach, and the fact that it is in an area economically dominated by the City of Los Angeles, a city substantially larger than Omaha, leads us to believe that its use would be unwarranted. While the school District of Long Beach is comparable in size to the Omaha District, the salary level in Long Beach may well be responding to salaries in Los Angeles in a manner analogous to that in which we believe salaries in Omaha suburban districts respond to salaries in the Omaha District. The array offered by the Association includes both St. Paul and Minneapolis. We regard this as essentially an instance of double counting. Following the counsel of caution enunciated in the Omaha Police case, supra, we strike St. Paul from the exhibit, since Minneapolis is the larger district and yet its standard salary schedule cost is somewhat lower than that of St. Paul, despite its higher base. That would give us an array of five school districts, Denver, Des Moines, Kansas City, Minneapolis and Toledo. The median district would be Des Moines. That district has a standard salary schedule cost of $37,858,851.25. If that standard salary schedule cost is divided by the index factor of 4,158.18 computed on Exhibit 9, it would support a starting salary of $9,105.00 for teachers in the Omaha District.
The Omaha District's Exhibit 37 is a list of six cities within the west-north central states region as defined by the federal government for its statistical purposes. This area is a subdivision of the statistical reporting area we utilized in the Omaha Firefighters case and is the same area we utilized in Lincoln Firefighters Association, Local 644 v. City of Lincoln , supra, 3 CIR 153-1. The District's array consists of six cities, Des Moines, Kansas City, Missouri, Lincoln, Minneapolis, St. Louis, and Wichita. We believe it would be appropriate to eliminate Lincoln from this array because of size. The elimination of Lincoln is consistent with the size criteria we utilize in teacher cases. It is also consistent with our decision in Lincoln Firefighters Association v. City of Lincoln , supra, 3 CIR 131. In addition, the witness, Sherman, who prepared the exhibit, indicated that he could have utilized either Kansas City, Missouri or Kansas City, Kansas, but chose Kansas City, Missouri. We were subsequently provided with salary data on Kansas City, Kansas, which indicates that salaries in that city are higher than in Kansas City, Missouri. Since the choice of Kansas City, Missouri has somewhat depressed the exhibit downward, we believe that the factor "of conservatism" which justified our retention of Lincoln in the Omaha Police case, supra, 3 CIR 10, has already been satisfied.
With Lincoln removed from Exhibit 37 we have an array of five school districts. In terms of salary schedule costs, St. Louis is the median district. If Omaha teachers were paid upon the St. Louis salary schedule, the salary schedule cost to the Omaha District would be $37,806,500.00. Division of this figure by the Exhibit 9 staff index factor of 4,158.18 would justify a starting salary of $9,092.00.
Exhibit 11, as restated by us, if it were directly used to set salaries would support a salary of $9,105.00. Exhibit 37, as restated by us, if it were directly used to set salaries would support a salary of $9,092.00. Utilization of the average percentage of raise in districts contiguous to Omaha and in Lincoln would support a starting salary of $8,946.00. We believe that the low figure established by the application of the average increase and the high figure drawn from restated Exhibit 11 establish the appropriate range within which the starting salary should be set. Because of the difficulty of direct comparison between school districts on Exhibit 11 or Exhibit 37 and the Omaha District, difficulties of comparison arising from differences in general wage levels and rates of inflation, we do not believe that a direct application of either of these exhibits to produce a salary is justified. The grant of a starting salary of $9,105.00 would place the start 7.1% above last year. A start of $9,092.00 would be 6.9% above last year's start. We have determined that the appropriate starting salary would be $9,025.00. This raises the start 6.1%. That increase is less than a percentage point higher than the average among the Nebraska districts upon which the Omaha District relied. It is a percentage point below the percentage increase represented by a $9,105.00 start. We believe that the figure of $9,025.00 represents a fair and appropriate judgment based upon the data before us, which takes full account of the District's concern that direct use of Exhibit 11 or Exhibit 37 would inflate salaries upward because of factors operative in the wage formation process in the school districts on those exhibits, which are not present in Omaha.
When our starting salary of $9,025.00 is multiplied by the Exhibit 9 index factor, it produces a total salary cost of $37,527,574.50. Even if we allow the teachers all of the additional fringe benefits they requested, with a fringe benefit cost of $1,635,376.74 as shown on Exhibit 11, the total cost to the District of our Order would be $39,162,951.24. The median total cost shown on Exhibit 11 is $39,399,778.31, while the median for Exhibit 37 is either $42,459,931.00 or $41,576,074.00, depending upon which figure for Minneapolis is adopted. Thus, with the teachers allowed the full fringe benefit package they request, the total cost would be below the median of either Exhibit 11 or Exhibit 37.
With salary set, we turn then to the matter of fringe benefits. Four matters are in dispute. Firstly, the percentage contribution of the Omaha District to the cost of providing family health insurance. The Association seeks a 75% contribution by the district after four consecutive years of service, the District's offer is a 55% contribution after that number of years. The Association seeks full payment by the school district of the cost of the single premium for each teacher for dental insurance coverage. Two other matters also are raised. The Association seeks extra duty pay for elementary teachers supervising the safety patrol and for elementary teachers supervising attendance at Junior Theater productions.
When we turn to fringe benefits, each of the parties reverses its position. The Omaha District's Exhibit 22 and Exhibit 36 indicate that the current practices of the Omaha District with regard to family health contribution and dental insurance are at least comparable to the prevalent practice among both the Exhibit 11 and Exhibit 37 school districts. Therefore, the Omaha District relies upon the non-Nebraska data. Conversely, the Association now relies on Nebraska data. It points out that Exhibit 6 shows that in the academic year 1975-1976 of the next ten largest school districts after Omaha, nine had contributions to family insurance considerably better than that of the Omaha district. Specifically, Bellevue made full family contribution, Westside made full family contribution after five years, Millard made full family contribution after three years, Grand Island contributed 60% of the family coverage costs in the first year, Fremont granted full family coverage after the fifth year, Papillion granted full family coverage after the third year, Ralston granted full family coverage after the third year, and Hastings had a 60% contribution in the first year, while Lincoln had a variety of plans available with family coverage as one of them. With regard to dental insurance, the Association notes that Exhibit 7 demonstrates that the vast majority of Nebraska teachers, virtually all of whom are covered by Blue Cross/Blue Shield, now have single coverage for dental insurance.
While the Omaha District's fringe benefit proposal with regard to family insurance and dental insurance are not as extensive as those of other Nebraska school districts, including those the Omaha District regarded as comparable, the salary in the Omaha District has been higher than those in other districts. Thus, it is possible that the difference in fringe benefits is accounted for at least in part by a trade-off between salary and fringe benefit costs. In addition, the starting salary which we have set is substantially above the salary in the other Nebraska districts. For that reason, we will not utilize the Nebraska districts. Exhibits 22 and 36 demonstrate that the offer made by the Omaha District does not significantly differ from the practice there evidenced. Since there is no showing that the District's offer is not comparable to the prevalent, we will adopt it in our Order.
Exhibit 4 shows fringe costs, assuming the District's proposal is adopted, at $1,390,956.34. This makes the cost of the total package we order with a starting salary of $9,025.00, $38,918,530.84. This figure is $481,247.34 lower than the median for Exhibit 11 with the removal of Long Beach and St. Paul. It is $2,657,543.00 lower than the lower of the two medians of Exhibit 37, with Lincoln eliminated. Thus, we believe that the total compensation package we have ordered is, on the one hand,comparable to the salaries evidenced by Exhibits 11 and 37, and yet somewhat lower than what could be required based upon those exhibits in order to take account of possible differences in situations among school districts. We believe our Order strikes a proper balance of "the interests of the plaintiffs with the interests of the public at large, and thus arrives at a fair compensation." Local Union No. 647, International Association of Firefighters v. City of Grand Island , supra, 3 CIR 51.
As to the remaining two matters, extra pay for Safety Patrol supervisors and for teachers who supervise attendance at Junior Theater, there is little evidence that other school districts grant compensation for these services. The Association concedes this, but argues that since these are extra burdens not borne by all teachers, fairness requires compensation. The statute allows us to make judgments of comparability and to require a school district to come up to a norm set by an appropriate array of comparable school districts. It des not, however, contemplate that we will make judgments of fairness unsupported by evidence of practice. On this matter of extra duty pay, since the Association has not proved the norm in the trade, it cannot be granted the relief it seeks. Omaha Association of Firefighters, Local 385 v. City of Omaha , supra, p. 117-17, 117-18.
The foregoing Opinion resolves the issues in dispute between the parties. It constitutes the Court's resolution of those issues, and it shall be effective as from the commencement of the contract year involved. As to other terms and conditions of employment, the parties reached agreement or agreed not to change past practice, and they are governed accordingly.
Entered January 27, 1977.