170                         January 17, 2013                            No. 4

              IN THE SUPREME COURT OF THE
                    STATE OF OREGON

                 ASSOCIATION OF OREGON
                CORRECTIONS EMPLOYEES,
                     Petitioner on Review,
                               v.
                     STATE OF OREGON
                and Department of Corrections,
                    Respondents on Review.
              (UP 3303; CA A143552; SC S059971)


    On review from the Court of Appeals.*
    Argued and submitted September 21, 2012.
   Becky Gallagher, Fenrich & Gallger, P.C., Eugene,
argued the cause and ﬁled the brief for petitioner on review.
   Leigh A. Salmon, Assistant Attorney General, Salem,
argued the cause and ﬁled the brief for respondents on
review. With her on the brief were Mary H. Williams, Deputy
Attorney General, and Anna M. Joyce, Solicitor General.
   Todd A. Lyon, Barran Liebman LLP, Portland, ﬁled
the brief for amicus curiae Oregon Public Employer Labor
Relations Association and The League of Oregon Cities.
  Jason A. Weyand, Senior Legal Counsel, Oregon
AFSCME, Salem, ﬁled the brief for amicus curiae Oregon
AFSCME. With him on the brief was Jennifer K. Chapman.
   Before Balmer, Chief Justice, Kistler, Walters, Linder,
and Landau, Justices, and Durham and De Muniz, Senior
Judges, Justices pro tempore.**
______________
    ** On judicial review from the ﬁnal order of the Employment Relations Board,
dated July 23, 2009. 246 Or App 477, 268 P3d 627 (2011).
    ** Brewer and Baldwin, JJ., did not participate in the consideration or
decision of this case.
Cite as 353 Or 170 (2013)                                                   171

    WALTERS, J.
   The decision of the Court of Appeals is reversed, and
the case is remanded to the Court of Appeals for further
proceedings.

     The Association of Oregon Corrections Employees (AOCE) brought an unfair
labor practice claim against the Department of Corrections (DOC), alleging that
DOC had changed the schedules of its employees without ﬁrst bargaining with
the AOCE in violation of the Public Employees Collective Bargaining Act. The
Employment Relations Board (ERB) held in favor of AOCE, determining that DOC
had not demonstrated that AOCE contractually had waived its statutory right to
bargain. The Court of Appeals reversed, holding that ERB had erred in using the
waiver analysis to evaluate DOC’s contractual defense, and determining that the
CBA unambiguously granted DOC the right to make the changes at issue. Held:
(1) ERB did not err when it utilized a waiver analysis to evaluate DOC’s contrac-
tual defense; (2) ERB did not err when it concluded that the terms of the parties’
collective bargaining agreement did not constitute a clear and unmistakable waiv-
er of AOCE’s right to bargain over the contested changes to employee schedules.
    The decision of the Court of Appeals is reversed, and the case is remanded to
the Court of Appeals for further proceedings.
172         Assn. of Oregon Corrections Emp. v. State of Oregon

             WALTERS, J.
        The Department of Corrections (DOC), a public
employer, made changes to its employees’ scheduled days off
and their shift stop and start times without ﬁrst bargaining
with representatives of the employees’ union, the Association
of Oregon Corrections Employees (AOCE). As an afﬁrmative
defense to AOCE’s ensuing complaint alleging that DOC
had committed an unfair labor practice, DOC asserted that
the terms of the parties’ collective bargaining agreement
(CBA) permitted its unilateral action. The Employment
Labor Relations Board (ERB) rejected DOC’s argument and
concluded that DOC had committed an unfair labor practice
under ORS 243.672(1)(e).1 The Court of Appeals reversed.
Assn. of Oregon Corrections Emp. v. State of Oregon, 246
Or App 477, 268 P3d 627 (2011) (AOCE II). We reverse the
decision of the Court of Appeals and remand to that court to
permit it to consider an assignment of error that it did not
reach.
       I.    FACTS AND PROCEDURAL BACKGROUND
         AOCE is the exclusive representative of a bargaining
unit of correctional ofﬁcers, sergeants, and corporals
employed by DOC, a public employer, at the Oregon State
Penitentiary. AOCE and DOC were parties to a collective
bargaining agreement that was effective from July 1, 2001,
through June 30, 2003. Shortly before May 27, 2003, AOCE
learned that DOC intended to post a new work schedule.
The new schedule changed, among other things, employees’
scheduled days off and their shift start and stop times. At a
bargaining meeting on May 27, 2003, AOCE informed DOC
that, in its view, the intended changes affected mandatory
subjects of bargaining and that DOC would be committing
an unfair labor practice if it implemented them without
bargaining with AOCE. On May 30, 2003, DOC posted the
new schedule. On June 27, 2003, AOCE ﬁled a complaint
   1
     ORS 243.672(1)(e) provides, in part:
       “(1) It is an unfair labor practice for a public employer or its designated
   representative to do any of the following:
       “* * * * *
       “(e) Refuse to bargain collectively in good faith with the exclusive
   [bargaining] representative [of its employees].”
Cite as 353 Or 170 (2013)                                                      173

with ERB alleging, among other things, that DOC had
committed an unfair labor practice under ORS 243.672(1)(e),
the provision of the Public Employees Collective Bargaining
Act (PECBA) that prohibits a public employer from refusing
to bargain collectively in good faith with the bargaining
representative of its employees.2
         DOC denied AOCE’s allegations and raised a
number of afﬁrmative defenses, one of which alleged that
“the Collective Bargaining Agreement allows management
to set the work schedule(s).” For that contractual defense,
DOC relied on Article 3 of the CBA, which included a
management rights clause providing that DOC “retains all
inherent rights of management” and “retains all rights to
direct the work of its employees, including but not limited
to, the right * * * to schedule work * * * except as modiﬁed
or circumscribed by the terms of this Agreement.” DOC
also alleged as a separate afﬁrmative defense that AOCE
had waived its right to bargain by failing to ﬁle a timely
demand, as required by ORS 243.698(3).
         ERB ﬁrst determined that “scheduling the particular
hours of the day and days of the week that an employee
is assigned to work constitutes ‘hours of work’, a per se
mandatory subject of bargaining under ORS 243.650(7)(a).”
Ass’n of Oregon Corr. Employees v. State of Oregon, Dep’t of
Corr., 20 PECBR 890 (2005). ERB then concluded that DOC
had made a unilateral change with respect to those matters
and, thus, had committed an unfair labor practice.3 Id. at
899. In doing so, ERB rejected DOC’s contractual defense,

     2
       In its complaint, AOCE alleged that DOC had committed an unfair labor
practice under ORS 243.672(1)(e) not only by unilaterally altering employee days
off and start-stop times for shifts, but also by unilaterally altering the incumbency
provision of the CBA and the rank that employees must hold to bid on certain
assignments.
     3
       ERB rejected AOCE’s other allegations that DOC had violated ORS
243.672(1)(e). ERB determined that AOCE was required to raise its claim
concerning the incumbency provision as a grievance or through an unfair labor
complaint under ORS 243.672(1)(g), which provides that it is an unfair labor
practice for a party to violate the provisions of any written contract with respect
to employment relations. ERB determined that DOC was not required to bargain
over the changes that it made to employee ranking because those changes
concerned the assignment of duties and minimum qualiﬁcations, both of which are
permissive subjects for bargaining. ORS 243.650(7)(g). AOCE did not challenge
those aspects ERB’s decision in the Court of Appeals.
174     Assn. of Oregon Corrections Emp. v. State of Oregon

determining that DOC had not demonstrated that AOCE
contractually had waived its statutory right to bargain over
the contested changes.4 Id. at 899-900.
         DOC appealed to the Court of Appeals. Its primary
argument on appeal was that ERB had erred in its analysis
of DOC’s contractual defense. ERB had erred, DOC
contended, in evaluating the CBA to determine whether
DOC had demonstrated a waiver of the statutory right to
bargain. Instead, DOC argued, ERB legally was required
to decide, as an initial matter, whether the CBA authorized
DOC to make the changes at issue. The court agreed with
DOC and did not reach DOC’s other arguments: that Article
3 constituted a waiver of AOCE’s right to bargain even
under ERB’s waiver analysis, and that AOCE had waived its
right to bargain by failing to ﬁle a timely demand to bargain
under ORS 243.698(3). The Court of Appeals reversed and
remanded the case to ERB, instructing ERB to determine
in the ﬁrst instance “whether, under the terms of the CBA,
DOC was authorized to make the changes * * * that it did.”
Association of Oregon Corrections Employees v. DOC, 209
Or App 761, 770, 149 P3d 319 (2006) (AOCE I).
         On remand, ERB determined that the terms of
the CBA were ambiguous and, after considering extrinsic
evidence, concluded that the parties had not authorized
DOC to make the contested changes. Ass’n of Oregon Corr.
Employees v. State of Oregon, Dep’t of Corr., 23 PECBR
222 (2009). The Court of Appeals again reversed. AOCE II,
246 Or at 479. The court determined that the terms of the
CBA unambiguously granted DOC the right to make the
contested changes and that ERB had erred in concluding
that DOC had committed an unfair labor practice under
ORS 243.672(1)(e). Id. AOCE sought review in this court,
which we allowed.
    4
      As to DOC’s defense that AOCE had waived its right to bargain by failing
to ﬁle a timely demand to bargain, ERB held that PECBA does not require a
formal demand to bargain under these circumstances. According to ERB, AOCE’s
statements, in which it contested DOC’s scheduling changes and argued that those
changes would constitute an unfair labor practice, were sufﬁcient. Moreover, ERB
concluded, even if AOCE’s statements were insufﬁcient to constitute a demand
under ORS 243.698(3), DOC’s unilateral implementation of the schedule three
days after AOCE had objected “essentially presented AOCE with a fait accompli.”
There is no requirement that a union demand to bargain, ERB explained, when
the employer already has made the unilateral change. Id. at 900-01.
Cite as 353 Or 170 (2013)                                                  175

         Before we begin our discussion of the issues for
our consideration, we note that DOC does not dispute that
(1) employees’ days off and shift stop and start times are
mandatory subjects of bargaining; (2) DOC had a statutory
obligation and AOCE had a statutory right to bargain over
those matters; and (3) DOC made changes to those matters
without ﬁrst bargaining with AOCE. Thus, whether ERB
was correct in concluding that DOC committed an unfair
labor practice under ORS 243.672(1)(e) depends on whether
ERB was correct in deciding that DOC had not established
a sufﬁcient afﬁrmative defense to the charge that it made
a change in a mandatory subject of bargaining without ﬁrst
bargaining with AOCE.
         The ﬁrst issue that we must reach in deciding
that question is the correct legal framework by which to
measure DOC’s afﬁrmative defense. In its 2005 decision,
ERB had used a waiver analysis—an analysis that the
Court of Appeals rejected in AOCE I. AOCE did not petition
for review in AOCE I. Therefore, ERB used the method of
analysis that the Court of Appeals required in AOCE I when
it considered DOC’s afﬁrmative defense on remand in 2009
and again concluded that DOC had committed an unfair
labor practice under ORS 243.672(1)(e). The question before
us on review of the Court of Appeals decision in AOCE
II is whether ERB was correct in its conclusion. Because
whether DOC committed an unfair labor practice depends
on the merits of its afﬁrmative defense, we must decide, as
an initial matter, the appropriate legal framework by which
to evaluate that defense, and we must do so despite the
fact that that matter was directly at issue in AOCE I and
is only indirectly at issue here. The correct legal measure
of DOC’s afﬁrmative defense is so inextricably intertwined
with its merits that we consider the following questions in
turn: First, did ERB err in deciding that, to prevail on its
contractual defense, DOC was required to demonstrate that
the terms of the CBA established a clear and unmistakable
waiver of AOCE’s statutory right to bargain? Second, did
ERB err in concluding that the terms of the CBA did not
meet the correct legal standard?5
    5
      Because the ﬁrst of those questions was directly presented only in AOCE I,
we asked the parties for supplemental brieﬁng on that issue. We have received and
considered that brieﬁng.
176    Assn. of Oregon Corrections Emp. v. State of Oregon

              II.   ERB’S WAIVER ANALYSIS
        We begin our inquiry into whether ERB erred in
its waiver analysis of DOC’s contractual defense with the
applicable unfair labor practice statute—ORS 243.672(1)(e)—
which provides, in part:
       “(1) It is an unfair labor practice for a public employer
   or its designated representative to do any of the following:
      “* * * * *
      “(e) Refuse to bargain collectively in good faith with the
   exclusive [bargaining] representative [of its employees].”
“Collective bargaining” is deﬁned in ORS 243.650(4) as
   “the performance of the mutual obligation of a public
   employer and the representative of its employees to meet
   at reasonable times and confer in good faith with respect
   to employment relations for the purpose of negotiations
   concerning mandatory subjects of bargaining, to meet and
   confer in good faith in accordance with law with respect to
   any dispute concerning the interpretation or application of
   a collective bargaining agreement, and to execute written
   contracts incorporating agreements that have been reached
   on behalf of the public employer and the employees in the
   bargaining unit covered by such negotiations.”
(Emphasis added.)
        “Employment relations”—about which a public
employer must bargain in good faith—is deﬁned in ORS
243.650(7)(a) to include
   “matters concerning direct or indirect monetary beneﬁts,
   hours, vacations, sick leave, grievance procedures and
   other conditions of employment.”
(Emphasis added.) “Employment relations” is further
deﬁned in ORS 243.650(7)(g) to exclude “scheduling of
services provided to the public[.]”
         Thus, a public employer commits an unfair labor
practice under ORS 243.672(1)(e) if it refuses to bargain with
respect to matters that are included within, and not excluded
by, the deﬁnition of “employment relations.” Those matters
are referred to as “mandatory” subjects of bargaining. See
Tualatin Valley Bargaining v. Tigard School Dist., 314 Or
274, 277, 840 P2d 657 (1992) (so explaining).
Cite as 353 Or 170 (2013)                                                      177

         As DOC acknowledges, a public employer commits
a per se violation of ORS 243.672(1)(e) if it makes a
unilateral change regarding a mandatory subject of
bargaining while the employer has a duty to bargain.6 See
Wasco County v. AFSCME, 46 Or App 859, 613 P2d 1067
(1980) (upholding ERB’s authority to adopt “violation per
se” analysis of unilateral changes). When reviewing an
allegation of unlawful unilateral change, ERB considers
(1) whether an employer made a change to an “established
practice,” often referred to as the “status quo”;7 (2) whether
the change concerned a mandatory subject of bargaining;
and (3) whether the employer exhausted its duty to bargain.
Ass’n of Oregon Corr. Employees, 20 PECBR 890, 897. When
asserted, ERB also considers an employer’s afﬁrmative
defense of waiver:
         “A party may waive its right to bargain through (1) ‘clear
      and unmistakable’ contract language, (2) a bargaining
      history that shows the party consciously yielded its right to
      bargain, or (3) by the party’s action or inaction.”
Id.
         At issue in this case is ERB’s use of the waiver
standard to evaluate DOC’s contractual defense. DOC
does not contend that ERB’s recognition of an afﬁrmative
defense of waiver is beyond its statutory authority or
conﬂicts with ORS 243.672(1)(e) or any other provision of
PECBA. Instead, DOC argues that ERB erred in conﬁning
its analysis of DOC’s contractual defense to a consideration
of whether the parties’ collective bargaining agreement
demonstrated a clear and unmistakable waiver of AOCE’s
      6
         ERB’s per se rule is modeled after an analogous rule adopted by the National
Labor Relations Board to enforce the duty to “bargain collectively” under section
8(a)(5) of the National Labor Relations Act (NLRA). The Supreme Court explained
the rationale for that rule in Labor Board v. Katz, 369 US 736, 747, 82 S Ct 1107, 8
L Ed 2d 230 (1962) (holding that an employer violates section 8(a)(5) of the NLRA
if it makes a unilateral change to employment conditions without bargaining over
the relevant term).
      7
         ERB has explained that cases dealing with allegations of unilateral change
that occur during the term of a CBA generally refer to the prohibited activity
as a change in employer “past practice,” while cases dealing with allegations of
unilateral change during the course of post-contract negotiations (the “hiatus
period”) refer to changes in the “status quo.” ERB has noted, however, that there
is “little difference analytically between these two.” Coos Bay Police Ofﬁcers’ Ass’n
v. City of Coos Bay, 14 PECBR 229, 232-33 (1993).
178   Assn. of Oregon Corrections Emp. v. State of Oregon

statutory right to bargain. DOC argues that ERB also was
required to consider whether the CBA authorized DOC to
take the unilateral action that it did. That requirement is
imposed, DOC contends, both by this court’s decision in
OSEA v. Rainier School Dist. No. 13, 311 Or 188, 808 P2d
83 (1991), which instructs ERB to consider the terms of a
collective bargaining agreement according to ordinary rules
of contract interpretation, and by PECBA. ERB’s analysis is
at odds with PECBA, DOC contends, because it “undermines
the sanctity of the written contract; * * * injects uncertainty
and instability into the labor-management relationship;
and * * * effectively ignores the preliminary step in any
unilateral change claim—namely, whether there has, in fact,
been a change in the status quo.” (Emphasis in original.)
         Before we consider DOC’s arguments, it is helpful
to trace the origins of ERB’s waiver analysis. ERB initially
applied the waiver analysis in considering an employer’s
contract defense to an unfair labor practice charge in
Corvallis School Dist. 509J v. Oregon School Employees Ass’n,
Chapter No. 2, 6 PECBR 5409 (1982). ERB took guidance
from cases decided by the National Labor Relations Board
(NLRB) under the National Labor Relations Act (NLRA),
the federal act on which PECBA was modeled. Elvin v.
OPEU, 313 Or 165, 177, 832 P2d 36 (1982). ERB held that,
under those cases, it was “settled law that any waiver of
the statutory right to bargain over a mandatory subject of
bargaining must be in clear and unmistakable language.”
Corvallis School Dist. 509J at 5412 (citing N L Industries v.
NLRB, 92 LRRM 2937, 2938 (1976)).
        The NLRB ﬁrst applied a waiver analysis in
considering an employer’s contractual defense to an unfair
labor practice charge in Tidewater Associated Oil Company,
85 NLRB 1096, 1098 (1949). In that case, a union charged that
an employer had made a unilateral change to its employees’
pension plan without ﬁrst bargaining with the union. In its
defense, the employer relied on a “Management Functions”
clause in the parties’ collective bargaining agreement. The
NLRB rejected the employer’s defense, upholding the Trial
Examiner’s ﬁnding that the broad “Management Functions”
clause “was at least ambiguous.” “Our agreement with the
Cite as 353 Or 170 (2013)                                                 179

Trial Examiner,” the NLRB wrote, “is based primarily
upon the absence of a speciﬁc waiver of the Union’s right to
bargain * * *. We are reluctant to deprive employees of any
rights guaranteed them by the [NRLA] in the absence of a
clear and unmistakable showing of a waiver of such rights.”
Id. at 1098.
         The United States Supreme Court afﬁrmed the
NLRB’s application of waiver as a defense to an unfair
labor practice charge in Metropolitan Edison Co. v. NLRB,
460 US 693, 103 S Ct 1467, 75 L Ed 2d 387 (1983). In that
case, a union had charged that an employer had committed
an unfair labor practice by treating union ofﬁcials more
harshly than other union members in the aftermath of a
strike, thus discouraging union membership in violation of
29 USC §158(a)(3).8 The Court considered whether a general
no-strike provision, such as the one in the parties’ collective
bargaining agreement, was sufﬁcient to waive the speciﬁc
right to strike over an unfair labor practice. Id. at 708. The
Court began by stating that it “long has recognized that a
union may waive a member’s statutorily protected rights[.]”
Waivers are valid, the Court explained, because they rest on
the premise of fair representation and presuppose that the
selection of the bargaining representative remains free. Id.
at 705. However, the court cautioned:
    “[W]e will not infer from a general contractual provision
    that the parties intended to waive a statutorily protected
    right unless the undertaking is ‘explicitly stated.’ More
    succinctly, the waiver must be clear and unmistakable.”
Id. at 708.9
   8
      29 USC § 158(a)(3) provides, in part:
         “(a) * * * It shall be an unfair labor practice for an employer
         “* * * * *
         “(3) by discrimination in regard to * * * any term or condition of
    employment to encourage or discourage membership in any labor organization
    * * *.”
    9
      In Metropolitan Edison, the Court relied on Mastro Plastics Corp. v. Labor
Board, 350 US 270, 76 S Ct 349, 100 L Ed 309 (1956), in which it had addressed
the question whether a general no-strike provision waived the speciﬁc right to
strike over an unfair labor practice. The Court in Mastro Plastics determined
that, although a waiver could be valid if it were “explicitly stated,” the terms
of the collective bargaining agreement at issue were not clear enough: a “more
compelling expression” of the waiver was required. Id. at 283.
180      Assn. of Oregon Corrections Emp. v. State of Oregon

         The NLRB continues to use the same waiver
analysis that it articulated in Tidewater. See Provena St.
Joseph Medical Center, 350 NLRB 808, 815 (2007) (when
an employer in a unilateral change case asserts that the
contract authorizes it to act unilaterally, the employer
must prove its defense by clear and unmistakable contract
language). See also John E. Higgins ed., 1 The Developing
Labor Law 1068 (6th ed 2012) (“Consistent with the
traditional common law view of waiver, the [NLRB] [has]
* * * conﬁned the waiver doctrine narrowly and [has] been
reluctant to infer a waiver.”).10

         In Oregon School Employees Ass’n v. Bandon School
Dist. #54, 19 PECBR 609 (2002), ERB decided to adhere to
the waiver analysis that it had articulated in Corvallis.
That analysis, ERB explained, was “historically recognized
by [ERB] and the private sector,” is “well-established,” and
“there is a large body of case law available for guidance in
deciding such cases.” Id. at 623-24. Considering the purposes
of PECBA, ERB determined that a waiver analysis was
most appropriate because it “keeps the focus where it should
be: on the general rule that there is a continuing duty to
bargain during the contract term over mandatory subjects


     10
        Although the Supreme Court has not yet applied the waiver analysis
followed in Metropolitan Edison to a charge that an employer committed an unfair
labor practice by refusing to bargain, the Ninth Circuit Court of Appeals has
done so. See Local Joint Exec. Bd. Of Las Vegas v. N.L.R.B., 540 F3d 1072, 1075
(9th Cir 2008) (applying Metropolitan Edison to hold that “[w]here a unilateral
change is defended on a claim of contractual right, the alleged waiver must be
* * * clear and unmistakable”). Decisions from the Second, Third, Fourth, Seventh,
and Eighth Circuits similarly have applied the waiver standard in cases where
employers invoked contract provisions as authority for making unilateral changes
in terms and conditions of employment. See, e.g., Bonnell/Tredegar Industries,
Inc. v. N.L.R.B., 46 F3d 339, 346 n 6 (4th Cir 1995); Olivetti Ofﬁce U.S.A., Inc. v.
N.L.R.B., 926 F2d 181, 187 (2d Cir 1991), cert den, 502 US 856 (1991); Ciba-Geigy
Pharmaceuticals Div. v. N.L.R.B., 722 F2d 1120, 1127 (3d Cir 1983); American Oil
Co. v. N.L.R.B., 602 F2d 184, 188-89 (8th Cir 1979); Murphy Diesel Company. v.
N.L.R.B., 454 F2d 303, 307 (7th Cir 1971).
     Not all courts agree. See, e.g., Bath Marine Draftsmen’s Ass’n v. N.L.R.B., 475
F3d 14, 25 (1st Cir 2007) (adopting the District of Columbia Circuit’s “contract
coverage” test); Enloe Medical Center v. N.L.R.B., 433 F3d 834, 838 (DC Cir 2005)
(rejecting the NLRB’s use of the waiver standard in the context of a unilateral
change case); Chicago Tribune Co. v. N.L.R.B., 974 F2d 933, 936-37 (7th Cir 1992)
(adopting the District of Columbia Circuit’s “contract coverage” test).
Cite as 353 Or 170 (2013)                                                   181

unless there is showing of waiver.”11 Id. at 624 (emphasis in
original).
         As noted, DOC does not contend that ERB’s waiver
defense exceeds its statutory authority or constitutes legal
error; instead, it contends that, under PECBA and this
court’s decision in Rainier School Dist. No. 13, 311 Or 188,
ERB cannot reach the issue of waiver until it ﬁrst decides
whether a collective bargaining agreement permits an
employer’s unilateral action. For the reasons that follow, we
conclude that ERB’s analysis was not legally erroneous and
that neither PECBA nor any other source of law compelled
ERB to adopt the analysis for which DOC advocates.
        We return ﬁrst to the text of ORS 243.672(1)(e), set
out infra, 353 Or at 176, and observe that it does not specif-
ically delineate or address defenses to a charge that an em-
ployer has committed an unfair labor practice by refusing to
bargain with respect to a mandatory subject of bargaining.
We then look to the enactment history of that statute and
case law interpreting it and learn that the Oregon legisla-
ture enacted PECBA in 1973 to model the NLRA. Elvin, 313
Or at 175 n 7. Therefore, cases decided under the NLRA, in-
cluding those outlining afﬁrmative defenses to unfair labor
practice charges, provide guidance in interpreting PECBA.
Id. at 177-78. Importantly for this case, the NLRB’s use of
a waiver rubric to analyze contract defenses to unfair labor
practice charges was well-established by 1973. Thus, we in-
fer that the Oregon legislature intended that defenses to
unfair labor practice charges under ORS 243.672(1)(e) be
analyzed under that same rubric. See State Treasurer v.
    11
       Prior to Oregon School Employees Ass’n v. Bandon School Dist. #54, 19
PECBR 609 (2002), ERB had permitted employers to defend unfair labor practice
claims by demonstrating that the union had agreed to contract terms that were
“speciﬁcally relevant to the issue in dispute.” See, Oregon School Employees Ass’n
v. Astoria School District 1, 13 PECBR 474, 480 (1992). However, ERB also had
continued to analyze contract terms asserted as an afﬁrmative defense under its
waiver analysis. See Fed’n of Oregon Parole and Probation Ofﬁcers v. Washington
County, 19 PECBR 441, 428 (2001) (holding that a general management rights
clause did not constitute a waiver). In Bandon, ERB determined that it would no
longer permit the “speciﬁcally relevant” defense. Id. at 609. The Court of Appeals
afﬁrmed that shift, recognizing that ERB’s formulation of what constitutes an
adequate defense may change over time. Lincoln Cty Ed. Assn. v. Lincoln Cty Sch.
Dist., 187 Or App 92, 98, 67 P3d 951 (2003). In this case, DOC does not challenge
ERB’s authority to make that shift, nor does it argue that the law requires ERB to
permit a “speciﬁcally relevant” defense.
182    Assn. of Oregon Corrections Emp. v. State of Oregon

Marsh & McLennan Companies Inc., 353 Or 1, 20, ___ P3d
___ (2012) (applying that principle of statutory interpreta-
tion).
         DOC’s argument that ERB’s waiver analysis
conﬂicts with the purposes of PECBA is not convincing. ERB’s
analysis does not undermine the sanctity of the written labor
contract or inject uncertainty or instability into the labor-
management relationship. If an employer and a union agree
by written contract terms that, going forward, the employer
will have the right to make unilateral changes to employees’
terms and conditions of employment, then those contract
terms will establish a waiver of the union’s statutory right
to bargain over those issues and will be enforced. The
parties can avoid uncertainty and instability by making the
employer’s right to take that future unilateral action clear
and unmistakable. The parties also may use ORS 243.672
to address alleged contract violations. ORS 243.672 makes
it an unfair labor practice for a public employer or public
employee to “[v]iolate the provisions of any written contract
with respect to employment relations.” ORS 243.672(1)(g);
ORS 243.672(2)(d). If a collective bargaining agreement
requires or permits certain action, a party that alleges a
failure to comply with such a provision may ﬁle an unfair
labor practice complaint alleging a contractual violation
under that statute. ERB’s waiver analysis does not conﬂict
with the terms of PECBA or thwart the legislature’s intent
or purpose.
          We also are not persuaded that ERB’s waiver
analysis is legally erroneous because it is contrary to this
court’s decision in Rainier School Dist. No. 13, 311 Or 188.
It is true that in that case, the court held that “[a] collective
bargaining agreement is one type of contract” and that “[i]n
discharging its statutory responsibility, ERB is required to
interpret collective bargaining agreements * * * in the same
manner and pursuant to the same rules of construction
as do courts.” Id. at 194. However, the court’s holding in
Rainier School Dist. No. 13 arose not in the context of ORS
243.672(1)(e), the statutory provision at issue in this case,
but in the context of ORS 243.672(1)(g), which makes it an
unfair labor practice for a public employer to “[v]iolate the
Cite as 353 Or 170 (2013)                                                 183

provisions of any written contract with respect to employment
relations.”12 In a charge under ORS 243.672(1)(g), the
inquiry is whether an employer has done what the collective
bargaining contract required it to do. In a defense to a charge
under ORS 243.672(1)(e), the inquiry is whether the union,
by agreeing to certain contract terms, has relinquished
its statutory right to bargain. Both inquiries require the
interpretation of the collective bargaining agreement, but
because the purpose of the inquiry is different, the rules of
construction also may differ.
         The fact that a collective bargaining agreement
is a contract and must be construed as such does not
preclude ERB from requiring that contract terms offered
to establish an afﬁrmative defense to a charge under ORS
243.672(1)(e) be evaluated under a waiver rubric. Absent a
sufﬁcient afﬁrmative defense, a union has a statutory right
to insist that an employer bargain over mandatory subjects
before making changes to the status quo. The general rule
in Oregon is that, although waivers of constitutional and
statutory rights may be expressed through contract terms,
those terms must clearly indicate an “ ‘intention to renounce
a known privilege or power.’ ” Johnson v. Swaim, 343 Or
423, 431, 172 P3d 645 (2007) (quoting Great American Ins.
v. General Ins., 257 Or 62, 72, 475 P2d 415 (1970)). Under
Oregon law, a waiver is “ ‘the intentional relinquishment of
a known right.’ ” Id. at 431 (quoting Waterway Terminals
v. P. S. Lord, 242 Or 1, 26, 406 P2d 556 (1965)). “To make
out a case of waiver of a legal right there must be a clear,
unequivocal, and decisive act of the party showing such
a purpose * * *.” Waterway Terminals, 242 Or at 27. See
also Taylor v. U.S. National Bank, 248 Or 538, 544, 436
P2d 256 (1968) (stating that contract language construed
to relinquish a widow’s statutory right to homestead and
exempt property must evince a “clear and explicit” waiver
of those rights).
    12
       In its 2005 decision in this proceeding, ERB distinguished between AOCE’s
claims that alleged that DOC had failed to bargain in good faith under ORS
243.672(1)(e) and those that alleged that DOC had breached its contract with
AOCE in violation of ORS 243.672(1)(g). A breach of the CBA alone, the ERB
explained, does not constitute bad faith bargaining; rather, such claims must be
raised as grievances under the CBA or through an unfair labor practice complaint
under ORS 243.672(1)(g). Ass’n of Oregon Corr. Employees, 20 PECBR 890 (2005).
184    Assn. of Oregon Corrections Emp. v. State of Oregon

         This court’s statement in Rainier School Dist.
No. 13 does not preclude ERB’s waiver analysis, nor does
it compel the analysis for which DOC advocates. As the
United States Supreme Court explained in Mastro Plastics
Corp. v. Labor Board, 350 US 270, 279, 76 S Ct 349, 100
L Ed 309 (1956), collective bargaining agreements are like
other contracts in that they “must be read as a whole and
in the light of the law relating to it when made,” but, when
the terms of a collective bargaining agreement are raised to
contest a union’s statutory right, the contract terms must
demonstrate that the union waived that right.
         Finally, ERB’s analysis does not ignore, but in
fact requires, consideration of the preliminary step in any
unilateral change claim—whether there has been a change
in the status quo. As noted, the ﬁrst step in ERB’s unfair labor
practice inquiry is whether the employer made a change to
an “established practice.” To make that determination, ERB
considers “[w]hether the parties have, by their words or
actions, deﬁned their rights and responsibilities with regard
to a given employment condition.” Coos Bay Police Ofﬁcers’
Ass’n v. City of Coos Bay, 14 PECBR 229, 233 (1993). ERB
looks to a variety of sources, including not only the terms of
a current or an expired collective bargaining agreement, but
work rules, policies, and an employer’s “pattern of behavior.”
Id. Thus, ERB does consider the terms of the parties’
collective bargaining agreement, among other factors, in its
analysis of whether the employer has made a change to the
status quo.
        DOC has not convinced us that PECBA or any other
provision of Oregon law required ERB to adopt a different
analysis in its consideration of whether an employer has
made a unilateral change in violation of ORS 243.672(1)(e).
When an employer relies on contract terms as an afﬁrmative
defense against a charge that it changed the status quo
without ﬁrst bargaining with the union, ERB may consider
those terms in evaluating whether they demonstrate that
the union waived the right to bargain about such changes.
The law does not demand that ERB ﬁrst consider those
contract terms to determine, under the status quo rubric,
whether they authorized the employer’s action. Such a
Cite as 353 Or 170 (2013)                                    185

requirement would effectively displace the waiver analysis
as a contract-based afﬁrmative defense to a charge under
ORS 243.672(1)(e), and we can discern no legal basis for
imposing it.
         In summary, the Court of Appeals was incorrect
when it decided in AOCE I that ERB had erred in its use
of the waiver analysis to evaluate the merits of DOC’s
contractual afﬁrmative defense. ERB’s waiver analysis
recognizes that the duty to bargain under ORS 243.672(1)
(e) continues after the parties have entered into a collective
bargaining agreement and that a union retains its right
to bargain on mandatory subjects of bargaining unless it
waives that right.
      III.   APPLICATION OF WAIVER ANALYSIS
         Because the Court of Appeals determined in AOCE
I that ERB had erred in its waiver analysis, the court
did not reach DOC’s alternative argument that, even if
ERB were correct in its use of that analysis, ERB erred in
concluding that the contract terms on which DOC relied did
not establish a clear and unmistakable waiver of AOCE’s
statutory right to bargain about changes to employees’
scheduled days off and their shift stop and start times. We
address that argument now. For the following reasons, we
hold that ERB did not err in its interpretation of the parties’
collective bargaining agreement.
        As noted, DOC invokes Article 3 of the CBA, which
provides:
       “The Association agrees that the Employer retains all
   inherent rights of management and hereby recognizes
   the sole and exclusive right of the State of Oregon, as the
   Employer, to operate and manage its affairs in accordance
   with its responsibilities to maintain efﬁcient governmental
   operations. The Employer retains all rights to direct the
   work of its employees, including, but not limited to, the
   right to hire, promote, assign, transfer, demote, suspend,
   or discharge employees for proper cause; to schedule work;
   determine the processes for accomplishing work; to relieve
   employees from duties because of lack of work or for other
   legitimate reasons; to take action as necessary to carry
   out the missions of the State; or determine the methods,
186     Assn. of Oregon Corrections Emp. v. State of Oregon

    means, and personnel by which operations are to be carried
    on, except as modiﬁed or circumscribed by the terms of this
    Agreement. The retention of these rights does not preclude
    any employee from ﬁling a grievance, pursuant to Article
    44, Grievance and Arbitration Procedure, or seeking a
    review of the exercise of these rights, when it is alleged
    such exercise violates provisions of this agreement.”
(Emphasis added.)
         In its 2005 decision, which was at issue in AOCE
I, ERB recognized that the legislature had distinguished
between scheduling services to the public and scheduling
employee work hours. Ass’n of Oregon Corr. Employees, 20
PECBR at 897-98. The latter was a mandatory subject of
bargaining, the former was not.13 ERB explained that, in
Article 3, the parties could have been referring to either
subject:
    “It is unclear * * * whether the language applies to
    scheduling services to the public, or instead to individual
    employee work hours. The language might also apply to the
    employer’s decision about when during the day to schedule
    a particular task, rather than to the hours a particular
    employee works.”
Id. at 900. “One point is clear,” ERB concluded: “[T]he
provision does not expressly give DOC the right to unilaterally
change the start/stop times and days off of employees. Such
ambiguity and lack of speciﬁcity preclude us from ﬁnding
a ‘clear and unmistakable’ waiver of bargaining over these
subjects.” Id.
         When ERB reconsidered its decision in 2009 after
remand by the Court of Appeals in AOCE I, ERB described
the phrase “inherent rights of management” in Article 3 as
one that is “commonly used in labor law” and stated that it
had “repeatedly used the phrase to refer to subjects that are
permissive for bargaining.” Ass’n of Oregon Corr. Employees,
23 PECBR at 237. ERB concluded that the phrase
    “is a term of art in labor-management relations, and the
    parties used the phrase as it is commonly understood in
    13
       Under ORS 243.650(7)(a), “employment relations” about which a public
employer must bargain in good faith, includes “matters concerning * * * hours[.]”
Under ORS 243.650(7)(g), “employment relations” does not include “scheduling of
services provided to the public.”
Cite as 353 Or 170 (2013)                                    187

   the labor-management community. Use of the phrase
   indicates that the parties intended the management rights
   clause to apply only to permissive subjects for bargaining.
   If so, the clause would not apply to work hours issues such
   as employee start-stop times and days off because they
   concern mandatory subjects for bargaining.”
Id. at 238. That interpretation was bolstered, ERB noted,
by the use of the word “retain” in Article. A party cannot
retain, ERB reasoned, something that it never had in the
ﬁrst place. Thus, one plausible reading of Article 3 was that
it authorized DOC to keep only those rights that it had
prior to negotiating that provision (i.e., the right to schedule
services to the public); it did not grant DOC rights that it
did not have (i.e., the right to schedule employee work hours
unilaterally). Prior to negotiating Article 3, DOC did not
have the right unilaterally to change employee work hours,
a mandatory subject for bargaining, and, ERB concluded,
Article 3 did not unambiguously bestow that right.
        In AOCE I, DOC argued to the Court of Appeals that
the CBA granted DOC the broad right to “schedule work”
and that, in the exercise of that right, DOC necessarily had
to determine when such work would start and stop and on
what days the work would occur. The fact that DOC’s right
to schedule might also encompass the scheduling of tasks did
not mean that the provision was “ambiguous”; rather, DOC
argued, it was merely an indication that DOC’s scheduling
powers were broad.
         DOC renews its argument in this court. Citing
UFORMA/Shelby Business Forms, Inc. v. N.L.R.B., 111
F3d 1284, 1290 (6th Cir 1997), DOC contends that a broadly
worded management rights clause operates as a clear and
unmistakable waiver of a union’s right to bargain with respect
to subjects covered by that clause. We are not convinced. As
ERB explained, there is a question in this case about the
subject matter that is covered by Article 3. In theory, Article
3 could cover scheduling employee work hours. However,
given ERB’s prior interpretation of the term of art included
in that Article and the parties’ use of the word “retain,” ERB
did not err in concluding that the meaning of the term “to
schedule work” in Article 3 also could be limited to directing
188      Assn. of Oregon Corrections Emp. v. State of Oregon

the work of employees and scheduling the services that they
provide to the public. Consequently, ERB also did not err in
concluding that Article 3 did not clearly and unmistakably
waive its statutory right to bargain over changes to
employees’ scheduled days off and their shift stop and start
times.14
      IV.    FAILURE TO FILE DEMAND TO BARGAIN
         DOC also asks that we address an additional
argument—that AOCE waived its right to bargain about
the changes that DOC made by failing to ﬁle a demand to
bargain within 14 days as required by ORS 243.698(3). The
Court of Appeals did not reach that argument in AOCE I
or AOCE II, and, because it involves arguments that differ
signiﬁcantly from those we address here, we remand to
permit the Court of Appeals to consider those issues in the
ﬁrst instance.
        The decision of the Court of Appeals is reversed,
and the case is remanded to the Court of Appeals for further
proceedings.




     14
        ERB’s ruling is consistent with its own prior case law. See Fed’n of Oregon
Parole and Probation Ofﬁcers v. Washington County, 19 PEBCR 411 (2001) (general
language typically found in management rights clauses does not constitute a
waiver); Days Creek Ass’n of Classiﬁed Employees v. Days Creek School Dist. 15, 16
PECBR 187, 202 (1995) (same); Service Employees Int’l Union, Local #49 v. Paciﬁc
Communities Hospital, 13 PECBR 753, 767 (1992) (“This Board does not often ﬁnd
a waiver of future bargaining rights in contract language. * * * Management rights
* * * clauses * * * typically ﬁnd their way into contracts with little discussion of the
parties’ intent. Moreover, most are worded so broadly that it cannot be concluded
that a union ‘clearly and unmistakably’ waived a bargaining right which might
never mature, and which concerns a subject not demonstrably in the contemplation
of either party at the time of the purported waiver.”).
