6 CIR 246 (1982). Appeal dismissed March 9, 1983.

NEBRASKA COMMISSION OF INDUSTRIAL RELATIONS

INTERNATIONAL BROTHERHOOD OF |
ELECTRICAL WORKERS, LOCAL | Case No. 457
UNION NO. 1521, AFL-CIO, |
|
Petitioner, |
|
v. | OPINION AND ORDER
|
METROPOLITAN UTILITIES DISTRICT, |
a Public Corporation, |
|
Respondent. |

Appearances:

For Petitioner: Benjamin J. Wall, David J. Cullan and Walter M. Calinger

For Respondent: W. L. Strong

Before: Judges Orr, Kratz, Gradwohl, Berkheimer and Davis (EN BANC)

BERKHEIMER, J:

I

PRELIMINARY MATTERS

Hearing was held in this matter upon Petitioner's Petition, Respondent's Answer and Cross-Petition, and Petitioner's Reply and Answer to the Cross-Petition. By its Petition, Petitioner seeks a determination of wages under Section 48-818, R.R.S. 1943. Respondent in its Answer denied the existence of an industrial dispute, demurred to the Petition, and alleged by way of Cross-Petition that wages and conditions of employment of the employees in question in many respects exceed prevalent wages and conditions of employment paid and provided workers exhibiting like or similar skills under the same or similar working conditions and prayed that wages, and conditions of employment currently paid and provided be reduced to the extent that they exceed prevalent wages, conditions and benefits. The Commission by previous order overruled Respondent's Demurrer.

Both in the Petition and Reply to Respondent's Cross-Petition, Petitioner alleged that the parties during negotiations made proposals to each other which were identical except for wages and certain specified conditions of employment and benefits and considering these items settled alleged they should not be reopened in this proceeding. Respondent in its Answer denied such an agreement, alleged all offers of settlement to be immaterial and irrelevant and moved to strike such allegations, substantially on the grounds that if there were an agreement between the parties as to certain terms or conditions, which agreement is denied, the Commission lacks jurisdiction over contract disputes or to declare contractual rights citing Transport Workers of America v. Transit Authority of the City of Omaha , 205 Neb. 26, 286 N.W.2d 102 (1979), and State College Education Association v. Board of Trustees , 205 Neb. 107, 286 N.W.2d 433 (1979). Petitioner in turn took issue with Respondent's position by Motions to Strike. By earlier Order both Petitioner's and Respondent's Motions to Strike were denied without prejudice to the parties raising the legal basis for their motions at the hearing.

The offer of an exhibit entitled "Contract Provisions At The End Of Bargaining" was forecast by Petitioner in the course of pretrial proceedings, but no such offer was made and the Commission therefore considers that Petitioner has abandoned its allegations and assertions discussed above, and in any event, no agreement of the parties with respect to conditions of employment or benefits is now before the Commission. The Petitioner introduced evidence of a wide range of fringe benefits beyond those which in its Petition has alleged to be the only unsettled matters, and the matter was tried on the basis of overall compensation and will be so considered by the Commission.

One other preliminary matter requires discussion before proceeding to the merits. During the presentation of Respondent's case Petitioner requested exclusion of certain of Respondent's witnesses pursuant to Section 27-615, Neb. R.R.S. 1943 which provides as follows:

"At the request of a party the judge shall order witnesses excluded so that they cannot hear the testimony of other witnesses, and he may make the order on his own motion. This rules does not authorize exclusion of (1) a party who is a natural person, or (2) an officer or employee of a party which is not a natural person designated as its representative by its attorney, or (3) a person whose presence is shown by a party to be essential to the presentation of his cause."

Respondent's counsel then represented to the hearing judge that the presence of these witnesses was essential to the presentation of Respondent's cause. The witnesses in question were those who, according to Petitioner's counsel, had engaged in job matching surveys. The testimony of a number of Petitioner's witnesses had been of the same type and their testimony had been introduced for the same purpose as the testimony which was expected from the witnesses which Petitioner sought to exclude. The hearing judge had observed that during the course of Petitioner's case while one of these witnesses was testifying for Petitioner, others of these witnesses frequently and repeatedly conferred with Petitioner's counsel and on many occasions one or more of these witnesses located and supplied material and documents for exhibition to the testifying witness, all of which appeared to be of material assistance to Petitioner's counsel. The hearing judge therefore accepted the representation of counsel for Respondent as to the presence of Respondent's similar witnesses being essential and denied the request. Moreover, the record shows no prejudice to the Petitioner in that the witnesses sought to be excluded conducted surveys of different employers and did so independently of each other; therefore, the Commission considers that their testimony has no mutual corroborative effect nor were the facts testified to by them in any way interdependent or mutually linked in a chain of evidence. All judges now join in the hearing judge's ruling.

II

JURISDICTION

The Commission finds an industrial dispute exists between the parties in this case and that the Commission has jurisdiction to settle the dispute.

III

COMPARABLE EMPLOYERS

The Petitioner proposed an array of comparable employers consisting of the following gas utility employers and local employers:

GAS UTILITY EMPLOYERS

Cengas - Lincoln, Nebraska

Central Illinois Light Co. - Peoria, Illinois

Central Illinois Public Service Co. - Springfield, Illinois Citizens Gas and Coke Co. - Indianapolis, Indiana

Iowa Electric Light and Power Co. - Ames, Iowa

Iowa-Illinois Gas and Electric Co. - Cedar Rapids, Iowa

Iowa Power and Light Co. - Des Moines, Iowa

Iowa Public Service Co. - Sioux City, Iowa

North Shore Gas Co. - Waukegan, Illinois

Northern States Power Co. - St. Paul, Minnesota

Public Service of Colorado - Denver, Colorado

Wisconsin Natural Gas - Milwaukee, Wisconsin

Wisconsin Power & Light Co. - Madison, Wisconsin

LOCAL EMPLOYERS

Northwestern Bell Telephone Company

Omaha, City of

Omaha Public Power District

Union Pacific Railroad

Western Electric Co.

The Respondent proposed an array consisting of the following gas utility employers, water utility employers, and local employers:

GAS UTILITY EMPLOYERS

Iowa Power and Light, Des Moines, Iowa

Gas Service Co. (Wichita Division), Wichita, Kansas

Citizens Gas and Coke, Indianapolis, Indiana

Madison Gas and Electric, Madison, Wisconsin

Department of Public Utilities, Colorado Springs, Colorado Louisville Gas and Electric, Louisville, Kentucky

Memphis Gas, Light and Water Division, Memphis, Tennessee

WATER UTILITY EMPLOYERS

City of Wichita, Kansas

City of Kansas City, Missouri

City of Tulsa, Oklahoma

City of Oklahoma City, Oklahoma

Board of Water Commissioners, Denver, Colorado

Des Moines Water Works, Des Moines, Iowa

Indianapolis Water Company, Indianapolis, Indiana

Louisville Water Company, Louisville, Kentucky

Memphis Light, Gas and Water Division, Memphis, Tennessee

Board of Water Commissioners, St. Paul, Minnesota

LOCAL EMPLOYERS

Lozier

Omaha World Herald

Douglas County

First National Bank

Immanuel Hospital

Physicians Mutual Insurance Company

Peter Kiewit

Sperry Vickers

Corps of Engineers

Valmont

Kelloggs

University of Nebraska at Omaha

Omaha National Bank

Creighton University

Con-Agra

H. D. R.

City of Omaha-Civilian

Thus, the only employers proposed by both parties are Citizens Gas and Coke, Iowa Power and Light Co., and City of Omaha. Under Section 48-818, R.R.S. 1943, in selecting employments for the purpose of comparison in arriving at comparable and prevalent wage rates, the question is whether, as a matter of fact, the employments selected for comparison are sufficiently similar and have enough like characteristics or qualities to make comparison appropriate. Fraternal Order of Police v. County of Adams , 205 Neb. 682,685,289 N.W.2d 535, 537 (1980); Omaha Ass'n of Fire-Fighters v.City of Omaha , 194 Neb. 436, 441, 231 N.W. 2d 710, 713 (1975); Crete Educ. Ass'n v. School Dist. of Crete , 193 Neb. 245, 255, 226 N.W.2d 752, 758 (1975). Since a factual determination is to be made in each case, the use of a particular array in one case does not require that the same group of employments would be appropriate in a different case. Crete Educ. Ass'n v. School District of Crete , 193 Neb. 245, 255, 226 N.W.2d 752, 758 (1975).

Central Illinois Public Service Co., Iowa Electric Light and Power Co., Iowa Public Service Co., and Wisconsin Power and Light Co. proposed by Petitioner do not serve metropolitan areas approaching the size of Omaha. The extensive non-metropolitan areas served by these companies result in a much wider geographic dispersal of employees. Respondent's job classifications are narrowly defined and highly specialized. The dispersal of employees in the foregoing situations does not lend itself to such specialization because employees in those situations generally perform a quite wide variety of duties. Those employers are excluded for that reason.

Public Service Company of Colorado, while it includes Denver, serves much of Colorado and is a far larger company than Respondent and is therefore excluded.

Petitioner's witnesses testifying as to job matches with respect to Northwestern Bell, Union Pacific, City of Omaha, and Western Electric did not make those job matches, but testified as to doing some verification of job matches made by others. The verification process at most involved only job descriptions with no verification of the work actually being performed for those employers. Probative evidence of authentication of actual job data in the original matching process is lacking. These employers must be excluded for those reasons.

Petitioner proposed Omaha Public Power District for both clerical and operating positions. One of Petitioner's experts who did not select the employers for Petitioner's surveys testified that he had studied gas and electric utility employment for seven years and found that on the average electric utilities pay their employees 5% more than do gas utility employers. Since there is a sufficient number of gas utility employers included in the array, there is no reason to include electric utilities in the operating array in view of the general variation between gas and electric utility employer wages.

With respect to Omaha Public Power District's clerical employees, Petitioner's Exhibit 36 showed wage scales for the period ending May 1981. Following the close of the evidentiary portion of the hearing, Petitioner filed a motion to substitute an exhibit (Substitute Exhibit 36) showing wage rates for the 12-month period ending May 1982 and Respondent objected. The basis for Petitioner's motion was that Mr. Benjamin Wall, who had presented Petitioner's case in chief and which was rested by him "subject to clerical errors" died during a recess of the case and prior to presentation of Respondent's case. It is the contention of Petitioner supported by an affidavit that had Mr. Wall lived he would have corrected the "clerical error" and that successor counsel found the proper exhibit (substitute Exhibit 36) among Mr. Wall's papers some time after the close of the record. Based on Petitioner's showing, Substitute Exhibit 36 is received in lieu of Exhibit 36 received at the hearing. The inclusion of Omaha Public Power District's clerical positions in any event has a quite minimal impact on wage increases. The Omaha Public Power District clerical positions are included despite the electric utilities wage bias mentioned above because it is a local clerical employer. There is evidence that banks and insurance companies generally pay lower wages than the median of other employers, and since these types of employers are offered by Respondent, Omaha Public Power District is included to provide a cross section of local employers.

Gas Service Co., Wichita Division, proposed by Respondent is excluded on substantially the same basis as the Denver Division of Public Service Company of Colorado in that Gas Service Co. serves part of Missouri, as well as territory in Kansas. Madison Gas and Electric Co., also proposed by Respondent, is excluded because the wage survey which is the foundational exhibit for that company is illegible.

The Commission finds that the following employers constitute a proper array for comparison in this case:

GAS UTILITY EMPLOYERS

Cengas - Lincoln, Nebraska

Central Illinois Light Co. - Peoria, Illinois

Citizens Gas and Coke Co. - Indianapolis, Indiana

Iowa-Illinois Gas and Electric Co. - Cedar Rapids, Iowa

Iowa Power and Light Co. - Des Moines, Iowa

North Shore Gas Co. - Waukegan, Illinois

Northern States Power Co. - St. Paul, Minnesota

Wisconsin Natural Gas - Milwaukee, Wisconsin

Department of Public Utilities, Colorado Springs, Colorado Louisville Gas and Electric, Louisville, Kentucky

Memphis Gas, Light and Water Division, Memphis, Tennessee

WATER UTILITY EMPLOYERS

City of Wichita, Kansas

City of Kansas City, Missouri

City of Tulsa, Oklahoma

City of Oklahoma City, Oklahoma

Board of Water Commissioners, Denver, Colorado

Des Moines Water Works, Des Moines, Iowa

Indianapolis Water Company, Indianapolis, Indiana

Louisville Water Company, Louisville, Kentucky

Memphis Light, Gas and Water Division, Memphis, Tennessee

Board of Water Commissioners, St. Paul, Minnesota

LOCAL EMPLOYERS

Lozier

Omaha World Herald

Douglas County

First National Bank

Immanuel Hospital

Physicians Mutual Insurance Company

Peter Kiewit

Sperry Vickers

Corps of Engineers

Valmont

Kelloggs

University of Nebraska at Omaha

Omaha National Bank

Creighton University

Con-Agra

H. D. R.

City of Omaha - Civilian

Tables 1 through 70 show wages paid by these employers for operating jobs and Tables 71 through 107 show such wages for clerical jobs. In each case, wages paid by Respondent are also shown.

Within the array the Commission rejected a few job comparisons used by Petitioner in its tabulations because there were discrepancies between wage steps in the comparison Union contracts and those assigned by Petitioner which are not satisfactorily explained in the evidence. Footnotes to the tables indicate situations where some of Respondent's job comparisons were rejected because foundational exhibits did not show job match percentages.

COMPARISON METHODS USED BY THE PARTIES

There are fundamental differences between the methodologies used by the Petitioner and Respondent in support of their respective positions on wage comparability. In order to explain these differences it is first necessary to understand Respondent's present wage structure which derives from a study made in 1970 by Commonwealth Services Inc. which was referred to throughout the evidence as the "Commonwealth Study". The approach of the Commonwealth Study was to assign numerically stated "values" to job classifications based on several numerically weighted factors. Ten pay "grades" were assigned to operating positions and nine pay grades were assigned for clerical positions. Job classifications found to have similar values were placed in the same pay grade. This job valuation and assignment process resulted in jobs of great dissimilarity being placed in the same pay grade. For example, painter II and special laborer/construction are both in one pay grade, and meter reader and chemical equipment mechanic II are both in another. Other examples are (pipe layer II and painter 1), (electrician II and water service inspector), (auto mechanic I and steam fitter), (electrician I and blacksmith).

Petitioners Methodology

The valuation process described resulted in many job classifications in the same pay grade. Petitioner's method was to survey a few of what it considered to be most representative jobs in each pay grade as "key classes". Consideration was given to the number of employees in the job classification. That is, a job held by many employees was considered more representative of jobs in that pay grade than a job held by few employees. Having made the survey on this basis, Petitioner's expert by regression analysis determined the wage rate which Petitioner contends should be assigned to each pay grade.

Respondent's Method

Respondent's method was to survey all job classifications and use those for which adequate matches were found among the employers surveyed. Respondent then compared matched jobs to unmatched jobs which are in a family of jobs, or are in a line or progression or are related in terms of skills needed or duties performed to the matched jobs. Then Respondent applied present wage differentials to impute wages for these unmatched jobs.

Commission Analysis

International Brotherhood of Electrical Workers, Local Union #763, AFL-CIO v. Omaha Public Power District , 3 CIR 554 (1978) describes guidelines to be met for use of key classifications. These were approved by the Supreme Court in AFSCME Local 2088 v. County of Douglas , 208 Neb. 511, 304 N.W.2d 368 (1981). These guidelines are as follows:

1.Job descriptions must exist, be generated, or be apparent to the Court from its previous experience. A job description is defined as a narrative statement of the work, skills and working conditions of a particular employee or a number of employees as a part of the whole function of the employer.

2. Job descriptions must match as between employers within 20% to be considered comparable.

3. The wage rates surveyed of the job descriptions tendered must cover a plurality of not less than 40% of the employees employed by the employer whose wages are sought to be adjusted.

4. 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.

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

6. The "key classifications" or wage rates tendered should have at least one in each regular line of progression, or lines of progression should be established as comparable or their relative market value established or apparent to the Court from its

previous experience.

7. The "key classifications" 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.

8.In setting wages from the key classification, where more than one class is surveyed in a single line of progression, the Court will not average the percentage increase or decrease, but will apply the percentage indicated to the classes not surveyed which are most closely related to the "key classification".

9. The Court, pursuant to Section 48-818 will not average the percentages of all of the key classifications surveyed to obtain an overall percentage of increase or decrease for all classifications.

It is at once apparent that guidelines 6, 7, and 8 are not met by Petitioner because its survey is entirely unrelated to lines of job progression but rather depends upon Respondent's own pay grades which so far as the evidence shows are unique to it and not followed in the industry generally. It is recognized that comparison of each and every job may be impossible or unfeasible and the guidelines for key classification comparisons are designed for the purpose of comparing unmatched jobs, but the material "key" to the key classification method is a relationship between a matched and unmatched job which permits comparison of the same or similar skills. The Petitioner's method falls materially short in this respect and will not be used.

The methodology of Respondent on the other hand is sufficiently close to meeting the above enumerated guidelines that it can be used and it will be used by the Commission.

Use of Petitioner's Job Matches

Even though the Commission does not consider that Section 48-818 standards permit use of survey results for one job in determining wages for totally unrelated jobs, Petitioner does show that Respondent's wages for the jobs surveyed and matched by Petitioner are generally less than comparable wages for those jobs. The Respondent argues that Petitioner's array is biased because some of the employments are for various reasons not comparable but also because the wages of the employees of all of Petitioner's employers are fixed by union contracts. No employer is excluded by the Commission because its employees work under a union contract. The Commission recognizes that a union may face a difficult if not impossible task in securing reliable wage and job matching information from non-union employers. Regardless of statistical bias through the inclusion of only unionized employers, the Petitioner did show that a material number of comparable employers are paying higher wages for some jobs than paid by Respondent, and the Commission therefore finds that the Petitioner proved a prima facie case for the jobs for which the Petitioner's evidence showed actual matches. Petitioner's evidence as to wages for these jobs paid by the employers included in the Commission's array is used.

IV

WAGE STEPS USED FOR COMPARISON

As mentioned above, Respondent has ten pay "grades" for operating positions and nine pay "grades" for clerical positions. The Respondent's wage structure includes seven wage "steps" for each pay grade. These are: "entry level", steps numbered one through four, a "standard" wage step and a "maximum" wage step. Petitioner argues that Respondent's "maximum " wage is not an integral part of Respondent's wage structure and that Respondent's "standard" wage should be compared with the maximum wages paid by other employers. The evidence shows that in recent years at least, advancement beyond standard has not generally resulted from a progression from standard into maximum by advancement within a pay grade, but rather from anomalous circumstances. One example of these circumstances is the downgrading of a job classification to a lesser paid classification with an employee who has been at the standard step before downgrading not receiving a pay decrease, thereby leaving him at a pay level higher than standard for his or her new pay grade. Another example is continuing a partially disabled employee at the same wage, but assigning him to a job in a lower pay grade resulting in his pay being higher than standard for his or her new pay grade. Moreover, the movement above standard has not been generally to maximum, but rather to some point between standard and maximum. The Commission finds that Respondent's "maximum" pay step is not appropriate for comparison for the purposes of this case. Respondent's "standard" pay step is considered to be Respondent's maximum step in comparing maximum wage rates for each job classification. Respondent's "entry level" step will be compared to minimum pay steps of other employers.

V

ECONOMIC CONSIDERATIONS

In Lincoln Fire Fighters Association Local 644 v. City of Lincoln , 198 Neb. 174, 252 N.W.2d 607 (1977), the court said that in Section 48-818 cases the Commission should consider reasonably similar labor markets. The court in that case also held the Commission must make appropriate adjustments for economic dissimilarities which have a bearing on prevalent wages.

Both parties introduced expert testimony regarding geographic economic considerations. The Petitioner's expert testified that wage levels in southern states were generally lower than in " non-south" states. The thrust of this testimony is that employers located in those states are not appropriate for comparison with an Omaha employer. Respondent's expert through exhibits and testimonies showed per capita county income comparisons for locations of employers proposed by both parties and he testified that percentage adjustments should be made for those per capita income variances.

Petitioner's evidence regarding and identifying Southern states would exclude employers proposed by Respondent located in Memphis, Tennessee, Louisville, Kentucky, and Oklahoma City and Tulsa, Oklahoma. While Petitioner's expert may well be correct as to generally lower wage levels in the southern states or perhaps in each southern state, we are not able to infer that this condition exists in the particular urban centers in issue here, particularly in view of per capita income data introduced by Respondent. Per capita income of Shelby County, Tennessee (Memphis) is lower than most of the counties involved, but is higher than El Paso County, Colorado (Colorado Springs). Jefferson County, Kentucky (Louisville) is higher than Douglas and Lancaster Counties. The per capita income of Oklahoma County, Oklahoma (Oklahoma City) is higher than most and that of Tulsa County, Oklahoma (Tulsa) exceeds all except three other counties. Therefore, Memphis, Tennessee, Louisville, Kentucky and Oklahoma City and, Tulsa, Oklahoma employers have been considered appropriate for comparison.

The Commission has in past cases discussed,its reasoning in not making adjustments based on differences in per capita income in the absence of evidence as to per capita income's relation to wage rates for employees under consideration. North Platte Police Officers Union v. City of North Platte , 3 CIR 647, 665-670 (1979), Lincoln Police Union International Brotherhood of Police Officers, Local No. 554 v. City of Lincoln , 5 CIR 134, 155-157 (1981), Local No. 831, International Association of Fire Fighters v. City of North Platte , 6 CIR 1, 35 (1982). Here a lack of correlation between per capita income and known wage rates paid by employers in a quite large number of counties negates any such relationship. Moreover, in this case Respondent's expert testified that per capita income is, as published by the government, the most meaningful figure for adjusting wage rates, yet on cross examination surprisingly disclaimed any material amount of knowledge regarding monetary items included in per capita income. The Commission finds that Respondent's evidence does not establish that adjustments of prevalent wage rates by reason of geographic differences in per capita income should be made.

VI

PREVALENT WAGE RATES

Table 108 shows comparisons of maximum and minimum wages for those jobs for which sufficient information was obtained to make direct comparisons with Respondent's jobs, together with Respondent's present wage rates for those jobs . Table 109 shows the wage rates imputed for other jobs for which insufficient comparable data was obtained. Wage rates for a directly compared job are imputed to a related job or jobs according to Respondent's present differential between the directly compared jobs and the related job or jobs.

The Commission finds that the wage rates for jobs shown on Table 110 are prevalent wage rates for the jobs enumerated in those Tables according to Section 48-818 criteria and that adjustment of Respondent's wage rates to such to rates shown on Table 110 would result in wage rates comparable to prevalent wage rates according to Section 48-818 criteria. Consistent with those findings, the data on Table 110 shows that for many jobs an increase in Respondent's rates would be necessary, to achieve prevalency, but that for some other jobs, the jobs prevalent wage rates are lower than Respondent's wage rates. Therefore, establishing rates for those other jobs would result in wage rates lower than Respondent has paid employees holding those jobs for the year in question November 1, 1981, to October 31, 1982.

Respondent by cross petition alleges that wages and conditions of employment of the employees in question in many respects exceed prevalent wages and conditions of employment paid and provided workers exhibiting like or similar skills under the same or similar working conditions of employment and prayed that wages and conditions of employment currently paid be reduced to the extent they exceed prevalent wages, conditions and benefits. The evidence sustains the factual allegations of Respondent's cross petition as to those employees holding jobs shown on Table 110 for which Respondent's wage rates are above prevalent wage rates.

VII

THE ISSUE OF LOWERING SOME WAGE RATES IN THIS CASE

The wage rates which Respondent seeks to lower in this case have been in effect since November 1980. They were paid by Respondent for an entire year from November 1980 through October 1981 before the beginning of the year in question on November 1, 1981. There is no evidence that the reduction of these wage rates were considered during the collective bargaining negotiations leading to impasse following which this case was brought to the Commission.

There is no statutory mandate that the Commission alter or establish wage rates in a Section 48-818 case. The first sentence of Section 48-818 reads: "The findings and order or orders may establish or alter the scale of wages, hours of labor or conditions of employment. . .." (emphasis added). The second and third sentences of Section 48-818 state that "In making such findings and order or orders, the Commission of Industrial Relations shall establish rates of pay which are comparable to the prevalent wage rates, and that "In establishing wage rates the commission shall take into consideration the overall compensation. . . ." Section 49-802 states that "Unless such construction would be inconsistent with the manifest intent of the Legislature, rules for construction of the statutes of Nebraska hereafter enacted shall be as follows: (1) When the word may appears, permissive or discretionary action is presumed. When the word shall appears, mandatory or ministerial action is presumed....." See Local Union No. 647 v. City of Grand Island , 196 Neb. 693, 244 N.W.2d 515 (1976) (interpreting the time limits specified in Section 48-813 to be discretionary and not mandatory).

The enlargement of a dispute by an employer when the dispute reaches the Commission, or the threat by an employer that the dispute will be enlarged if the employees bring a Commission proceeding, raises serious questions addressed by the Supreme Court in Local 2088 AFSCME v. County of Douglas , 208 Neb. 511, 304 N.W.2d 368 (1981), Supplemental Opinion, 209 Neb. 597, 309 N.W.2d 65 (1981), and under Section 48-811, RRS 1943. In the Local 2088 case the Supreme Court held that wage increases may not be withheld where the only obvious purpose is to punish employees for joining the Union or engaging in a labor dispute. In that case the Court said, "As an example, if the public employee in this case were to dismiss its suit in the CIR, it would be paid. . ." a wage increase.

Section 48-811 provides in part "No adverse action by threat or harassment shall be taken against any employee because of any petition filing by such employee. . . ." The record in this case does not establish whether or not a wage decrease was sought in collective bargaining; however, it is clear that when an employer has not in good faith bargaining sought a wage decrease, the seeking or threatening to seek a decrease if the employees request a wage determination by the Commission operates as a penalty condemned by the Supreme Court in the Local 2088 case and constitutes adverse action by threat or harassment prohibited by Section 48-811.

The Supreme Court stated in its first opinion in the Local 2088 case (208 Neb. at 525-527):

"We do believe, however, that one further matter requires comment. Though it was not raised by either party, the record discloses that Douglas County may have granted to county employees not members of AFSCME a raise but withheld the same to members of AFSCME because of the existence of a labor dispute. We believe such practice is both improper and illegal. In a separate opinion in Lincoln Fire Fighters Assn. v. City of Lincoln , 198 Neb. 174, 187, 252 N.W.2d 607, 615 (1977), it was correctly observed: " 'In an unregulated labor market, labor and management test their relative market power through bargaining. This testing may include resort to the strike or the lockout. However, the Legislature decided that the services provided by employees subject to [the CIR'S] jurisdiction were too vital to allow interruption while employer and employees tested the merits of their claims by trial by battle. When discussion is barren, employers and employees in the public sector are routed [to the CIR].Judicial mandate replaces economic power as the determinate of wages."' We recognize, therefore, that the public employer and the public employee do not stand on the same footing as employers and employees in the private sector.

The policy of the public sector law in Nebraska is clear. It is to ensure "[t]he uninterrupted and proper functioning and operation of the governmental service..." See Neb. Rev. Stat. §48-802 (Reissue 1978). If on the other hand, employees may not refuse to work without risk of discharge, employers may not refuse to pay employees the wage established by the governmental employer for such work.

Furthermore, Neb. Const. art. XV, §§13 and 15, would indicate that public employees may not be discriminated against or punished because they have sought collective bargaining and

have reached an impasse with the public employer. In the case of Local Union No. 647 v. City of Grand Island , 196 Neb. 693, 244 N.W.2d 515 (1976), it was determined that any attempt by

management to dissuade employees from joining a union is unfair and unlawful act. To withhold from employees the salary which the governmental employer has determined is at least the minimal appropriate wage for no other obvious purpose but to punish the public employee is not permitted.

Logic indicates to us that the wage to be paid for similar work during a given year to employees not involved in the dispute would be the minimum wage the employer could pay to those involved in the dispute. Any other conclusion would result in the employer favoring nondisputing employees over disputing employees, in violation of Neb. Const. art XV, §§ 13 and 15.

As an example, if the public employee in this case were to dismiss its suit in the CIR, it would be paid at least that amount which the public employer has determined to be appropriate for all employees in a given year. We therefore fail to see how the existence of a labor dispute in the public sector can authorize the public employer to withhold from the public employee wages which the public employer has publicly declared to be, at a minimum, the appropriate wage for the job performed and to require the public employee to continue performing services at a wage which has been determined for a previous year and which, by the employer's own determination, is below the comparable wage.

It is therefore the order of this court that no public employer shall withhold pay raises otherwise determined to be granted to public employees in a given year solely on the basis that they are then engaged in a labor dispute over a previous year's wages. Such a declaration may, in fact, cause some disputes to become moot. It would occur to us that that would be in keeping with the policy of the entire act and consistent with the Legislature's desire that the public policy of this state be such that there be no interruption of public service. The action of the CIR in the instant case is reversed and remanded for further proceedings in accordance with this opinion, if necessary.

REVERSED AND REMANDED WITH DIRECTIONS."

Following the submission of further Briefs and an oral reargument of this issue, the Supreme Court stated in a Supplemental Opinion (209 Neb. at 597-598):

"In argument on the motion for rehearing, appellee maintains that the language of our opinion previously adopted and appearing at 208 Neb. 511, 304 N.W.2d 368 (1981), with regard to the obligation of the public employer to the public employee over subsequent years' raises, is ambiguous. In an effort to clarify our position, we substitute the following language to our opinion, in lieu of that language which now appears as the last full paragraph of the opinion:

It is the holding of this court that once a public employer has established a rate of pay for the performance of a particular job in a specific year by granting an across-the-board, cost-of-living wage increase to a group of employees, it may not withhold paying that salary to an employee of the classification granted the raise and performing that work, who would otherwise be entitled to payment at the increased rate of pay, solely on the basis that at the time the payment should otherwise be made the public employer and the bargaining representative of the employee are then engaged in a labor dispute. By so declaring, we intend that the wage which should be paid to a public employee by a public employer during a dispute is that wage which the public employer has declared as the appropriate wage to be paid and which it would otherwise agree to pay the public employee if no dispute then existed. As an example, if in the instant case all county welfare employees were granted an increase of 7 percent across the board as a cost-of-living wage increase, the county may not pay the increase to nondisputing employees while escrowing the funds belonging to disputing employees until the dispute is terminated. Such a declaration may, in fact, cause some disputes to become moot. It would occur to us that that would be in keeping with the policy of the entire act and consistent with the Legislature's desire that the public policy of this state be such that there be no interruption of public service. The order of the CIR in the instant case is reversed and the cause remanded for further proceedings in accordance with this opinion, if necessary.

REVERSED AND REMANDED WITH DIRECTIONS."

The Commission was Created "In order to carry out the public policy of the State of Nebraska as set forth in Section 48-802..." Section 48-803. Section 48-802 provides in part: "The continuous,uninterrupted and proper functioning and operation of the governmental service including governmental service in a proprietary capacity and of public utilities engaged in the business of furnishing transportation for hire, telephone service, telegraph service, electric light, heat or power service, gas for heating or illuminating, whether natural or artificial, or water service, or any one or more of them, to the people of Nebraska are hereby declared to be essential to their welfare, health and safety."

Section 48-810 provides that "All industrial disputes ... shall be settled by invoking the jurisdiction of the Commission of Industrial Relations ......"

The Commission in exercising its discretionary power to alter or establish wage rates should first address the question of whether in this case exercising such authority would settle the dispute in a manner which will best carry out the purpose of the statutes.

The statutes contain no provision preventing the Commission of Industrial Relations from ordering a reduction in compensation. This is so even if such an order lowering wages would have an effect of requiring employees to repay compensation previously received from their employer. Following the Supreme Court's original decision in the Local 2088 case, the employer paid compensation to the employees involved in that litigation which, in some instances, was greater than the rates of pay established by the Commission pursuant to section 48-818 following remand from the Supreme Court. See, Local 2088 v. Douglas County , 5 CIR 265 (1981). In AFSCME Local 32 v. Dakota County , 5 CIR 214 (1981), the Commission acted to invalidate wage increases paid by the county in violation of Section 48-811. Nevertheless, establishing lower wage rates presents difficult practical problems and public policy considerations. Usually the year involved in the dispute has partially elapsed and sometimes, as here, entirely elapsed before the case can be tried and decided by the Commission. During all of the elapsed time, the employees have been receiving wages at the higher levels. The question of how a wage reduction order for the year in question could be implemented is not easy to answer. For employees to be required to repay excessive wages or to require future wages to be still further reduced by the already paid excess would create severe hardships on employees and place severe strain on the employer-employee relationship. The lowering of wages should not be lightly undertaken. However, the Commission must be on notice that a reduction in compensation is not now an infrequent issue in both public and private sector collective bargaining.

Therefore, if an employer has in good faith sought a wage reduction in collective bargaining and the wage reduction is a genuine issue in the industrial dispute which brings the parties before the Commission, and if the evidence shows as it does here that wages for some jobs are higher than prevalent wages under Section 48-818 criteria, the Commission should establish wage rates for those jobs at prevalent rates despite difficult implementation and policy questions.

On the other hand, if the only dispute negotiated at the bargaining table is whether or not wages should be increased or the extent of an increase, the employer should not be permitted to enlarge the dispute when it reaches the Commission. Where a wage reduction was not a genuine issue in the industrial dispute which brought the parties to the Commission, an order reducing wages does not settle that dispute.

It is not necessary that the parties engage in collective bargaining prior to initiation of the proceeding in the Commission seeking the establishment of wages and conditions of employment under Section 48-818; although Section 48-816(1) authorizes the Commission to order bargaining to be begun or resumed during the pendency of the case. Where there have been negotiations, however, and particularly, where there have been good faith bargaining leading to an impasse of the negotiations, those negotiations may define the nature and extent of the "industrial dispute" to be settled by the Commission. In teachers' salary cases, for example, the Commission has stated that "changes in salary schedule structure are best achieved through collective

bargaining, and past practice should not be disturbed in the absence of substantial variances from the prevalent practice." West Holt Faculty Association v. School District No. 25 , 5 CIR 301 (1981). Similarly, the Commission might maintain that the previous years' number of teacher contract days and the existing proportional relationship between wages and fringe benefits as parts of overall compensation should be continued in the absence of those issues having been raised during the negotiations leading to the bargaining impasse which the Commission is called upon to settle.

In this case, if reduction was a genuine issue in the dispute before it reached the Commission there is no evidence to that effect. The lack of evidence on this point is hardly surprising in that the Commission has not heretofore addressed the question of wage reductions. Several factors prompt the Commission not to reduce wages in this case even though the Commission has not heretofore announced prerequisites to such reductions. Almost half of the year in question had elapsed prior to final briefing, and the complexity of the case has taken up the remainder of that year. Respondent has not suggested by brief or otherwise how a reduction could be practically implemented.

Of the 11 gas utility employers which the Commission found suitable for comparison, six were surveyed by Petitioner only. Because of Petitioner's methodology, only relatively few jobs of those employers were surveyed and matched. The evidence shows, generally speaking, those six employers on the average pay higher wages for these matched jobs than does Respondent. Since the evidence does not show statistical bias in Petitioner's job selection, there is an inference that wage levels for many unsurveyed jobs of those six employers may well be higher than MUD. There is also an inference that there are unmatched jobs of

those gas utility employees which match MUD jobs and which, if

surveyed, would result in higher prevalent wages for those jobs which were surveyed by Respondent alone. Petitioner, having the burden of proof for increases, cannot complain that the lack of evidence regarding rates for unmatched jobs of these six employers results in a finding of lower prevalent wage rates for jobs which Petitioner did not survey. On the other hand, Respondent, for no adequately explained reason, failed to survey six out of eleven gas utility employers which the Commission finds suitable for comparison, many of which are located closer to Omaha than those Respondent surveyed, leaving the inference that unsurveyed jobs of a substantial number of comparable employers, if surveyed, might result in a finding of higher prevalent wages for many jobs. These possible inferences are additional bases for the Commission exercising its discretion in not establishing wage rates for jobs which are currently higher than the evidence shows to be prevalent.

While reductions in wages should be ordered in a proper case, the starting point for reductions should be at the bargaining table and not before the Commission.

Accordingly, the Commission in this case will not alter wage rates for those jobs carrying wage rates above those found to be prevalent.

The attached Table 111 identifies the jobs for which the Commission alters wage rates in this case and shows "entry level" and "standard" wage rates established by the Commission for each such job. As noted above respondent's present "standard" wage step has been considered its maximum step for comparison purposes, and the Commission in this case does not deal with respondent's wage step which it entitles "maximum."

VIII

FRINGE BENEFITS

Only Petitioner introduced evidence on fringe benefits; therefore, fringe benefit evidence relates only to a small number of other employers in the array used by the Commission. The Commission has examined and compared the fringe benefits furnished by those other employers with those furnished by Respondent and finds that MUD's overall fringe benefit package is not inferior to the overall fringe benefit package of other employers in the array for whom fringe benefit evidence was introduced. Petitioner has not sustained its burden in establishing prevalent higher fringe benefits and no change in fringe benefits should be ordered.

IT IS ORDERED:

1. That for the twelve month period November 1, 1981 through October 31, 1982, the entry level and standard wage rates for each job identified in Table 111 shall be those shown on Table 111, as the term "entry level" and "standard" are used in respondent's present wage structure and that the difference between wage rates for entry level and standard steps shall be distributed among respondent's present wage steps 1 through 4 as the parties may agree or in the absence of agreement, consistently as nearly as practicable with the present distribution of the difference between entry level and standard steps;

2. That the increases ordered shall be paid for the twelve month period from November 1, 1981 through October 31, 1982 as soon as practicable following the entry of this order;

3. That there be no change in fringe benefits;

4. That the wage rates established by the Commission are limited to those jobs identified in Table 111.

All judges of the Commission joined parts I through VI and part VIII of the foregoing opinion and in parts 1, 2 and 3 of the foregoing order. John M. Gradwohl, Richard L. Berkheimer and Harvey D. Davis join in part VII of the foregoing opinion and in part 4 of the foregoing order.

Filed December 21, 1982.

Jeffrey L. Orr, dissenting :

I respectfully dissent to the majority holding because of its failure to lower wages to the prevalent. (primarily discussed in Part VII).

The Commission is faced in this case with a situation where the evidence clearly establishes that some of the job classifications are presently paid above the prevalent. The Commission has in many previous cases raised wages when they were below the prevalent. Local No. 831, International Association of Firefighters v. City of North Platte , 6 CIR 1 (1982); Fraternal Order of Police, Hall County No. 10 v. Hall County , 5 CIR 358 (1982); Omaha Police Union Local No. 1 v. City of Omaha , 5 CIR 171 (1981); Local No. 2088, AFSCME v. County of Douglas , 5 CIR 265 (1981).

Also, the Commission on many occasions made the wage order retroactive, Local No. 831, International Association of Firefighters v. North Platte , 6 CIR 1 (1982); Paxton Education Association v. School District Number Six , 6 CIR 41 (1982); Millard Education Association v. School District of Millard , 6 CIR 58 (1982); Broken Bow Education Association v. School District of Broken Bow , 6 CIR 60 (1982).

The Commission has not previously been faced with the issue of lowering wages that are above the prevalent. In this case, the petitioner plead that IBEW 1521 and MUD were unable to reach an agreement as to wages and other terms and conditions of employment to prevail after the expiration of their current contract on November 1, prevail after the expiration of their current 1981; wherefore, IBEW 1521 requested the Commission conduct hearings and make such findings and enter such orders so as to settle the industrial dispute. The respondent plead wages, conditions of employment, and benefits currently paid and provided to bargaining unit employees exceeded prevalent wages and conditions of employment, and benefits paid and provided workers exhibiting the same or similar skills under the same or similar working conditions; wherefore, MUD requested the Commission reduce those items to the extent they exceed the prevalent being paid and provided.

Both parties have sought to have the wages set comparable to the prevalent under the guidelines of 48-818.

"The findings and order or orders may establish or alter the scale of wages, hours of labor, or conditions of employment, or any one or more of the same. In making such findings and order or orders, 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. In establishing wage rates the commission shall take into consideration the overall compensation presently received by the employees, having regard not only to wages for time actually worked but also to wages for time not worked, including vacations, holidays, and other excused time, and all benefits received, including insurance and pensions, and the continuity and stability of employment enjoyed by the employees. Any order or orders entered may be modified on the commission's own motion or on application by any of the parties affected, but only upon a showing of a change in the conditions from those prevailing at the time the original order was entered."

The statute provides that the commission MAY establish or alter wages. But in so establishing or altering wages the Commission SHALL establish rates of pay which are comparable to the prevalent. This statutory mandate does not require that wages only be raised. The language is clear. Whether the wages are raised or lowered the end result is that they shall be comparable to the prevalent.

The respondent alleged in its pleading that the wages were above the prevalent and should be lowered. The evidence supports respondent's allegation.

As far as this Commission is concerned, it is immaterial whether the possibility of lowering wages was an issue at the bargaining table. We have consistently held the negotiations prior to filing with the Commission are immaterial and irrelevant. Milford Education Association v. School District of Milford , 1 CIR 43 (1971); Centennial Education Association v. School District 67-R of Seward County , 1 CIR 44 (1971); Fremont Education Association v. School District of Fremont , 1 CIR 50 (1972).

Therefore, it was sufficient for the parties to plead and ask for an order lowering wages. The mandate of 48-818 then requires the Commission to enter the appropriate order based upon the evidence.

Based upon the evidence before the Commission, some wages must be lowered to be comparable to the prevalent.

This then raises the question of when this reduction should become effective. As previously stated, the Commission clearly has authority to order retroactive raises. Therefore, it would follow that the Commission would have authority to order decreases in wages retroactively. However, a retroactive decrease could pose many problems for both the employer and employee.

It is not uncommon for the contract year to have lapsed by the time the case is tried and a decision rendered. Obtaining a refund of wages already paid by the employer to the employee would put a strain on the employer-employee relationship.

The Commission was created "in order to carry out the public policy of the State of Nebraska as set forth in Section 48-802." Section 48-802 provides in part: "The continuous, uninterrupted and proper function and operation of the governmental service including governmental service in a proprietary capacity and of public utilities engaged in the business of furnishing transportation for hire, telephone service, telegraph service, electric light, heat or power service, gas for heating

or illuminating whether natural or artificial, or water service, or any or more of them, to the people of Nebraska are hereby declared to be essential to their welfare, health and safety."

In this case the respondent has voluntarily paid the current wages knowing that some were above the prevalent. The respondent has not asked that the wages be lowered retroactively. The prayer of the respondent is simply that the Commission order that the wages, conditions of employment and benefits currently paid and provided be reduced to the extent the same exceed the prevalent wages, conditions of employment, and benefits paid and provided to similar workers.

Therefore in considering public policy, the inherent problems that may be caused and the issues as framed by the pleadings, I would have lowered those wages that were above the prevalent to conform with the evidence. Table 110 sets out the adjusted wages as per this dissent. The effective date of any reduction should be the date of the Order.

Dean G. Kratz concurs with this dissent.

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