                                      No. 84-406
                IN THE SUPREME COURT OF THE STATE OF MONTANA
                                          1985



IN THE MATTER OF THE UNIT CLARIFICATION
NO. 6-80, MONTANA PUBLIC EMPLOYEES
ASSOCIATION,
                           Petitioner and Appellant,


DEPARTMENT OF ADMILIISTRATION, LABOR
RELATIONS BUREAU; and THE BOARD OF
PERSONNEL APPEALS,
                           Respondents and Respondents.




APPEAL FROM:      District Court of the First Judicial District,
                  In and for the County of Lewis & Clark,
                  The Honorable Henry Loble, Judge presiding.

COUNSEL OF RECORD:
         For Appellant:
               Hjort, Lopach     &   Tippy; Barry L. Hjort, Helena,
               Montana

         For Respondent :
               Jayne Mitchell, Dept. of Administration, Helena,
               Montana
               James Gardner, Board of Personnel Appeals, Helena,
               Montana



                                      Submitted on Briefs:   May 3, 1985
                                                  Decided:   August 5 , 1985


Filed:   4 ~ i ;5 - 1985
Mr. Justice William E. Hunt, Sr., delivered the Opinion of
the Court.


        This   is   an    appeal   by   the Montana     Public Employees
Association (MPEA), appellant, from an adverse decision by
the Board of Personnel Appeals             (BPA), respondent, and the
decision of the District Court affirming the order of the
BPA, that excluded certain employees from a labor bargaining
unit.
    We affirm.
        Two issues are presented on appeal.              They are:       (1)
Whether the District Court erred in affirming the agency
decision that a change of exclusive representatives nullified
the applicability of the grandfather clause provided for in S
39-31-109, MCA; and         (2)    Whether the District Court erred in
denying the appel.lantls application to present additional
evidence.
        Prior to November 1979, the employees at Montana State
Prison were         represented in collective bargaining by              the
American       Federation     of     State,   County,      and    Municipal
Employees, AFL-CIO.         This representative was decertified and
replaced       by   the    MPEA    in   November   1979.         After   the
representative of the employees changed, the Labor Relations
Bureau of the Montana Department of Administration filed a
petition for unit clarification of the labor bargaining unit
before the BPA.           The petition sought a determination that
certain classes of employment positions at Montana State
Prison were "supervisory employees" and therefore should be
excluded from the labor bargaining unit.
    A hearing examiner of the BPA determined that positions

titled "correctional lieutenants" were llsupervisory.'f The
appellant filed exceptions t o this determination and the
                            .
matter was then appealed to the BPA.                        The appellant argued
before the board that a grandfather clause, S 39-31-109, MCA,
contained       in     the        Montana        Public   Employees           Collective
Bargaining       Act,        §$     39-31-101        through    39-31-409,            MCA,
preserved the existing bargaining unit and precluded unit
clarification.         This argument was not made before the hearing
examiner.     After hearing and considering the matter the Board
ruled that the change of representatives for the bargaining
unit removed the existing unit from the application of the
grandfather clause.               The hearing examiner's proposed order
was    then   adopted        as     the     final    order.         The   MPEA        then
petitioned for judicial review.
       Before    judicial          review began, the           agency order was
stayed and       the    review was held              in abeyance pending the
outcome of City of Billings v. Billings Firefighters Local
No. 521 (Mont. 1982), 651 P.2d 627, 39 St.Rep. 1844.                                  That
case involved the grandfather clause as it pertained                                   to
bargaining units and bargaining agreements in existence in
1973, the effective date of the Act.                      After City - Billings
                                                                     of
was    decided       judicial           review    commenced.        The       appellant
petitioned for leave to present additional evidence based on
City - Billings.
     of                           The District Court denied the reauest
ruling that no good cause had been shown and affirmed the
agency final order.           It ruled that the Board's interpretation
that   a   change       of    representative results                in    a    loss    of
grandfather      status           was     rational    and     not    an       abuse    of
discretion.      This appeal followed.
       Issue no. 1 concerns the propriety of the decision of
the BPA that a change of representative nullifies appl-ication
of the grandfather clause.                  In 1973, the Montana legislature
enacted a     law governing collective bargaining            for public
employees.      This law is contained in SS 39-31-101 through
39-31-409,    MCA,    the    Montana   Public   Employees    Collective
Bargaining Act.      Several provisions of this Act are relevant
here.     First, the policy of the Act:
        "39-31-101.   Policy.   In order to promote public
        business by removing certain recognized sources of
        strife and unrest, it is the policy of the State of
        Montana to encourage the practice and procedure of
        collective bargaining to arrive at friendly
        adjustment of all disputes between public employers
        and their employees."
        Next, pursuant to national labor policy, as set forth in
the National Labor Relations Act, 29 U.S.C.           S 151, et seq,
(19761, the Montana Act specifically excludes supervisory and
management     employees      from     the   definition     of   "public
employee. "    Section 39-31-103 (2)(b)(iii), MCA.          Only public
employees     are   allowed   to bargain     col.lectively.      Section
39-31-201, MCA.       Supervisory and mana.gement employees were
effectively denied membership in collective bargaining units.
See, City of Billings v. Billings Firefighters Local No. 521
(Mont. 1982), 651 P.2d 627, 629, 39 St.Rep. 1844, 1845.
        The last provision applicable here is the grandfather
clause:
        "39-31-109.      Existing   collective   bargaining
        agreements not affected. Nothing in this chapter
        shall be construed to remove recognition of
        established   collective    bargaining   agreements
        already recognized or in existence prior to July 1,
        1973."
        The Board of Personnel Appeals held that this statutory
provision does not apply when there has been "such a change
of exclusive representatives in a grandfathered agreement and
bargaining unit. "          "Such a change" meaning election and
certification of a new exclusive representative.
     The Board of Personnel Appeals argues that a change of
exclusive representation nullifies the applicability of the
grandfather clause as to preserving the unit.                        The Board
argues that the term "recognized," in its technical la.bor
vernacular, applies only to representatives and it therefore
follows     that,      because    units       are    not     "recognized,"      the
legislature did not intend to preserve units by enacting the
grandfather clause.              This    interpretation of         the    law    is
rational.      The word "recognized" as used in S 39-31-109, MCA,
is   a    term    of    art   used       in    labor    as    referring    to    a
representative.           The BPA decision also              is in line with
relevant portions of the acts set forth above which, in
effort    to     remove    causes       of    strife   and    unrest,     exclude
supervisory employees from bargaining units.                      We hold that
the District Court did not err                      in affirming the agency
decision.
     Issue no.         2 need not be considered or decided here
because the resolution of issue no. 1 negates the need for
additional evidence based on - - Billings to be received
                             Citl of
in this case.
     The District Court is affirmed.
