5 CIR 1 (1980)


Petitioner, |
Public Corporation, |
Respondent. |


For the Petitioner: David D. Weinberg

and David J. Cullan.

For the Respondent: Soren S. Jensen.

Before: Judges Kratz, Wall, and Orr.


This matter brings before us the dispute between Petitioner and Respondent as to the proper wage level for the operating and clerical divisions of the Respondent. We have jurisdiction of the parties and of the subject matter of the dispute.

At the time of submission of the dispute, many items were yet in controversy. In the elapsed time since submission, the parties have resolved all outstanding issues except wages and the effective date of any increase ordered by this commission. The question of the effective date of our wage orders is no longer an open matter. We have considered and ruled on the question before, and have always concluded that the period or periods under negotiation at the time of impasse was the period governed by our order. For at least nine years prior to this litigation, Petitioner or its predecessor in interest has had one-year contracts with Respondent. It was negotiating a one-year contract at the time impasse was reached here. The prior contract covered the period November 1, 1977, to October 31, 1978. The order herein will thus determine wages for the one year period beginning November 1, 1978, and ending October 31, 1979.

Because of the many and varied jobs and job descriptions involved in Respondent's operations, the parties have generally utilized the "key classification" analysis in the presentation of their evidence. We first approved this approach in IBEW v. OPPD , 3 CIR 554 (1978). This analysis or approach requires:

1. The determination by empirical, parametric studies, of the classifications most populated and most representative of the entire employee population.

2.A survey of other comparable employers to obtain the rates of pay for job classifications presenting at least an 80% match as to job duties in the "key classes" to be compared.

3. Job descriptions must exist, be generated, or be apparent to the commission from its previous experience or expertise.

4. Job descriptions must match, as between employees, within 20%, to be considered comparable.

5.The wage rates surveyed of the job descriptions tendered must cover not less than 20% of the total job descriptions of the employer whose wages are sought to be adjusted.

6. The "key classes" together with the related lines of progression, must permit direct or computed establishment of at least 85% of the classes involved.

7.The wage rates of the "key classes" tendered should have at least one in each line of progression, or lines of progression should be established as comparable, or their relative market value established, or the comparability of the lines of progression or relative market value must be apparent to the commission from its previous experience or expertise.

8.The "key classes" must be subject to checking for accuracy of assessment of job content, lines of progression, and similarity or dissimilarity of other key classes and lines of progression within the several employers offered as sources of comparables.

9.Where more than one class is tendered from a single line of progression, the increase or decrease will not be averaged, but the adjustment, if any, will be applied to the classes most closely related to the key class tendered.

10. Pursuant to Section 48-818, R. R. S. 1943, the commission will not average the percentages of all the key classifications tendered to obtain an overall percentage of increase or decrease for all classifications of the employer.

Proof of Prima Facie Case. We find that petitioner has met the foregoing ten requirements, and has presented a case sufficient to survive a motion to dismiss. For reasons hereinafter more fully explained, we are unable to use the exact parameters of those requirements in this particular case, and have found it necessary to apply further statistical tests in order to arrive at a rational determination. The use by us of these tests and processes neither denigrates the petitioner's case nor means that we want the parties to present their data in such form. As we point out hereinafter, we need raw data, not computations arranged by a statistician, for our determinations. The laws of statistics and mathematics are far more deeply etched in stone than the laws of the land. While we may permit an expert to expound at length on his theory at trial and in the transcript, these recitations are at best arguments for applying one or more statistical tests to the facts, the data, and we do not now, nor do we intend in the future, to regard these opinions as facts by which we are bound any more than a jury is bound by an opinion. See Nebraska Jury Instructions , Instruction 1.42.

Stipulations and Agreements of the Parties. The parties agreed that the names of the employers submitting data on clericals to the respondent should not be mentioned in the order or opinion herein, in order to preserve, to a certain extent, the confidentiality of the information.

The parties agreed that the comparability of the clerical lines of progression and classes need not be established, such comparability being stipulated.

The parties agreed that EX35, the so-called "Commonwealth Study", be received in evidence without further foundation. This Exhibit has been used by the parties for the past nine years as a basis for establishing grades, relationship of one grade to another, and to all other grades, rates of pay, lines of progression, and comparable employers.

The parties agreed that positions in the gas and

water divisions carrying the same grade have equal skills and working conditions, and are comparable.

The parties agreed that the original contracts from which summaries were prepared, such summaries being exhibits herein, should be considered as evidence and exhibits, and might be referred to by the parties or the commission as necessary in making any determination herein. We have not found this necessary, since the stipulation primarily affected the majority of the items in dispute at the time of trial, and concerned the exact wording of clauses on certain fringe benefits as contrasted to the summaries of those benefits used by the parties in the exhibits used at trial.

Petitioner waived foundation for Respondent's Exhibits 1 through 21, but reserved objection to the foundation for any opinions expressed in Exhibits 4A through 5G. These Exhibits are the responses to the survey of other utilities conducted by the Respondent, and contain opinions by persons in the other utilities, who profess no knowledge of job formats in Respondent, except such as they obtained from the job descriptions furnished with the blank survey form (and whose knowledge of their own utilities' job descriptions does not appear of record) as to the comparability of the jobs in the other utilities with the jobs in the Respondent. There was no attempt to utilize them as the basis for expert testimony at trial under the provisions of Sec. 27-703 et seq., R. R.S. 1943. These exhibits contain the Respondent's only evidence of similarity of work, skills and working conditions necessary for the comparisons required under Sec. 48-818, R. R. S. 1943.

This case was tried prior to the decision in Plattsmouth Police Union v. City of Plattsmouth , 205 Neb. 567, 288 N. W. 2d 729 (1980). In that case, the Supreme Court said in part:

"The commission based its order upon an array consisting of Beatrice, La Vista, Nebraska City, York, Papillion, Blair, Ralston, Fairbury, and Plattsmouth. It chose these cities because they were the four cities immediately above and below Plattsmouth in population and were within a reasonable distance of Plattsmouth. Of these cities the defendant submitted evidence only as to salaries in La Vista, Nebraska City, Blair, and Plattsmouth. "

"The plaintiff was allowed, over objection, to introduce exhibits compiled from questionnaires concerning salaries paid in 22 first class cities. The plaintiff called an expert witness who, over objection, was allowed to testify as to his opinion based upon these exhibits. "

"The questionnaires had been prepared by the expert witness. The plaintiff had mailed the questionnaires to the police departments in the 22 cities. The questionnaires which were returned to the plaintiff through the mail were not authenticated in any way. The questionnaires listed minimum and maximum salaries but there was no indication as to whether the salaries listed were actually being paid or under what conditions employees would be entitled to receive the maximum salaries."

"In the taking of evidence the commission was required to follow the rules of evidence prevailing in the trial of civil cases. Sec. 48-809, R. R. S. 1943. Because of the lack of foundation evidence to establish the source and reliability of the information contained on the questionnaires which was the basis for the compilations offered by the plaintiff, the defendant's objections to these exhibits should have been sustained. An expert witness should not be allowed to express an opinion where the evidence shows there is no adequate basis for the opinion. Clearwater Corp. v. City of Lincoln , 202 Neb. 796, 277 N. W. 2d 236. The result is that there is no substantial evidence in the record to sustain the findings and order of the commission.

Respondent's exhibits were available to the Petitioner prior to trial pursuant to the order setting the case for hearing entered October 4, 1979. The evidence was made a part of the record at trial. Petitioner had an opportunity to rebut such evidence or information by cross examination or testimony at the trial. Petitioner waived foundation as to the authenticity of the factual data in the exhibits. On the record, the exhibits were admissible under Section 48-817, R. S. Supp. 1979. See General Drivers v. City of West Point , 204 Neb. 238, 281 N. W. 2d 772 (1979). As noted hereinafter and in the appendices, we have exercised our authority as fact finder to reject such of the information as is internally inconsistent or unworthy of credibility, either on the basis of the common experience of mankind, (the jury standard) or on the basis of our previous experience and expertise (the specially trained or authorized commission, board or tribunal standard).

Some months after the completion of the trial, the parties agreed that all fringe benefits had been determined by the parties by collective bargaining, and that fringe benefits should not even be mentioned in the commission's decision. Since the parties, at the time of the stipulation, knew the statutory burden placed upon us by Section 48-818, R.R. S. 1943, to compare and adjust total compensation, we read this agreement as one agreeing that the wage package as determined by the commission, when combined with the agreed fringes, will make the total "comparable to the prevalent". To do otherwise would place the commission in the untenable position of having the parties stipulate that it could not decide the case, when the clear intention of the parties was to aid the commission in its decision herein.

Choice of Array. The parties over the years have used the employers listed in EX35 as their basis for comparison and establishment of rates of pay and job evaluation. As we have noted before, the prior practice of using certain other employers for comparison is persuasive that those employers have jobs which are in fact comparable under our standards. The companies listed in EX35 are Allied Chemical (Nitrogen Division), Central Illinois Light Co., Central Telephone and Utilities (CENGAS), Iowa Power and Light, Mutual of Omaha, Northern Illinois Gas Co., Northern Natural Gas Co., (now Internorth), Northwestern Bell Telephone Co., Omaha National Bank, Omaha Public Power District, Union Pacific and Western Electric. Where it is apparent that one of the listed companies was utilized previously by the parties solely for clerical comparison, we limit its use to clerical employees.

Petitioner tenders 13 comparables for the operating division: Iowa Electric, Interstate Power, Northern States Power, Iowa Power and Light, Wisconsin Power and Light, Wisconsin Natural Gas, OPPD, Public Service of Colorado, Iowa-Illinois Gas and Electric, Gas Service Co. (Kansas City, Missouri), Minnesota Gas Co., Lincoln Cengas, and Iowa Public Service.[1]

Iowa Power and Light and OPPD qualify to remain in the array on the basis of their past use by the parties. Of the factors submitted by the parties as establishing comparability, we deem gas sales in mcf, number of employees in the gas division, miles of main and total customers, to be the most significant indicia of similarity of operation, which in turn indicates similarity of jobs and job skills even absent the detailed study of jobs made by Petitioner's several experts. The items for comparison are thus as follows:

'77 Sales , m*c*f # Emp. Miles of Main # Customers

MUD 31,049,963 390 1584 121,017

IEL&P 40,428,857 438 3751 121,589

INTPWR 22,699,774 125 772 42,099

NOSTPWR 31,384,239 324 796 96,802[2]

IP&L (See above)

WP&L 26,685,597 270 2062 92,832

WNG 61,860,100 308 3921 191,810

OPPD (See above)

PSCO 58,862,649 451 -- 159,103[2]

IILG & E 47,153,346 317 1329 94,885[2]

GSCKC 66,782,991 659 4590 170,833[2]

MNGC 116,466,000 -- -- 367,834[2]

LCENGAS 32,622,000 240 -- 104,745[2] IPS 41,817,000 203 1777 115,458

It is apparent on even a quick scan of the table, that Gas Service Co. of Kansas City and Minnesota Gas Co. fail to match in a sufficient number of critical areas to permit them to remain in the array. A further examination shows that Interstate Power matches in only one category, and that it, too, must go out. This leaves us with ten comparables offered by petitioner which fit within our rule-of-thumb parameters of "twice as large or half as large". Respondent submits six gas companies: Columbia Gas of Kentucky, Connecticut Natural Gas, South Jersey Gas, Kansas Power and Light, Iowa Public Service, (offered also by petitioner) and Southern Connecticut Gas. Kansas Power and Light sells twice as much gas as respondent, and with less than half the miles of main. We reject it as a comparable company.

Respondent also submits seven water companies (municipalities), Tulsa, Atlanta, Nashville, Toledo, Oklahoma City, El Paso, and Seattle. Substituting water sales in thousands of gallons for gas im mcf, we find them to be sufficiently comparable for use in this instance. We cannot, however, use Oklahoma City, since its affidavit is blank, and there is no showing of where respondent got its figures for its summary. Since there are other transcription errors in respondent's summary, we do not feel free to use the figures on the summary attributed to Oklahoma City.

Our other problem with respondent's evidence is, as mentioned above, that respondent's survey asked, and usually got, an "average actual hourly rate". Of necessity, this rate is weighted by the nature of the population within the class, their tenure, entry level, experience, and any other factors which would affect placement within the class. Where we have used these figures, therefore, we have "unweighted" them by comparing them to MUD's mid-step, and then computing the minimum and maximum using MUD's minimum/maximum ratio for that class. This is a most laborious and time consuming task, and could have been avoided simply by presenting the raw data. In the future we will not accept data from the parties unless the raw data is first presented. If the parties then wish to press some theory of how the data should be used, they may do so in separate exhibits.

All of the employers are arrayed, and the figures tabulated at Appendix A.

We then turn to the clerical array. Petitioner tenders 13 employers and Respondent tenders 9, giving us a total array under the stipulation, of 22 employers. While not totally unmanageable, an array of this size is generally larger than that which we prefer to utilize. Unfortunately for the commission, respondent produced again only average wages for each class. While in the past we have worked with either minimums or maximums (while expressing a preference for minimums)[3] we are unable to ascertain any reasonable use of averages within a classification, when the decision asked of us is to set minimums, steps and maximums, and we are not given the data necessary to return the averages back to basic, usable data. We are thus forced to do the best we can with the data furnished, unweighting it as best we can. The samples are arrayed, and the figures tabulated at Appendix B.

Anomalies, computations, and legislative choices. Because of anomalies arising from the computations and indication of a definite skew in the minimums in the operating divisions, we have discarded a job by job setting of wages. In addition, when the evidence of both parties is graphed, it is spectacularly evident that the figures for classes 0-1, 0-2, 0-8 and 0-9 are heavily skewed upwards. We have thus computed the wages on a "line of best fit" in grades 0-3 thru 07, extending the line in both directions to encompass the other four grades.

In the clerical grades, classifications C-2, C-3, C-4, C-5 and C-6 exhibit the least degree of skew, and we have therefor in the clerical classes also used a "best fit line" based basically on those 5 classes and extended it to grades C-1, C-7, C-8 and C-9.

Also, because of the extremely high ratio of single person "classes", it has been difficult for us to distinguish exact lines of progression. Because, and only because the parties have used the exact relationships set in EX35 to establish wages in the past, we have chosen or computed a single rate for each class instead of computing a "line of progression" series of rates. (We reserve our doubts, expressed several times in past opinions, as to the validity of the attempted quantification of job skills in order to place every job in exact relationship to every other job. Here, it is usable because it constitutes an admission against interest by both parties because of their earlier reliance on it.) In making this legislative judgment, we have considered several factors, among them being: (1) a conservative approach to the data to assure that we have not been misled by a skewed array into setting the wage outside the parameters of the actual market, (2) the consideration of, and an attempt to maintain the breadth of the relationships between the bottom and top steps in each classification as previously bargained by the parties,

(3) the consideration of, and an attempt to maintain the slope of the line, if computed and graphed, connecting the bottom and top rates as previously negotiated by the parties, (4) the consideration of, and an attempt to maintain the relationships between is classes as set by the parties in the last contract, and

(5) maintaining the same approximate ratios between one top step and the next, as well as the same approximate ratios between one bottom step and the next.

The wages computed are shown at Appendix C, and the wages set are shown at Appendix D. The intermediate steps, which are apparent to us, are left to the parties to set by agreement. If they cannot agree, they may return here, and we will fix the steps also.

ORDERED, that the dispute is settled as herein set forth, all judges of the panel concurring.

Entered July 29, 1980.

[1] Hereinafter, when abbreviated, abbreviated as follows:



[2] 1976 figures.

[3] Omaha Police Union v. City of Omaha , 3 CIR 356 (1977).