                                                                                                                   FILED
                                                                                                            COURT OF APPEALS
                                                                                                                DI'v' IS10: 1 I
                                                                                                                            -

                                                                                                           2 0 1 4 MAR 13   AM 10: 17
    IN THE COURT OF APPEALS OF THE STATE OF W

                                                          DIVISION II

KITSAP COUNTY and KITSAP COUNTY                                                          No. 4411
SHERIFF,


                                          Respondents,


          VA



KITSAP            COUNTY                 CORRECTIONAL                             PUBLISHED OPINION
OFFICERS' GUILD, INC.,




                                   1—
         PENOYAR, J. P. T.                This action arises from Kitsap County' s decision to lay off two

corrections officers       for    budgetary     reasons.     The officers' union, the Kitsap County Correctional

Officers Guild ( Guild), demanded to bargain the decision to                        lay   off    the   officers.   The County

agreed to bargain the effects of the layoffs but not the decision. The County sought a declaratory

judgment in superior court stating that layoffs are a permissive bargaining subject and the Guild

committed an unfair         labor       practice when      it demanded to bargain the decision. The Guild filed a


cross   motion      for summary judgment seeking ( 1)                    a declaration that layoffs are a mandatory

                                    2)        injunction               further layoffs    without      bargaining.     The trial
bargaining       subject   and (         an                 against




court granted declaratory judgment in the County' s favor.

         The Guild appeals, arguing that the County' s claim was not justiciable, layoffs are a

mandatory       bargaining        subject, and    it is   entitled    to attorney fees   on appeal.       The County argues

that,   even    if the layoffs     are   a mandatory       subject,   the Guild   waived   its   right   to bargain.   We hold

that the parties have an actual, present dispute regarding the right to bargain the layoffs; thus, the

County' s      claim   is justiciable.        Additionally, the Guild did not waive its right to bargain over


1 Judge Joel Penoyar is serving as a judge pro tempore of the Court of Appeals, Division II,
pursuant       to CAR 21(   c).
44183 -7 -II



layoffs because the        contractual waivers        had   expired.       However, the trial court was required to


conduct a balancing test to determine whether the layoffs in this case are a mandatory bargaining

subject.    The   record     does   not reflect   that the   court engaged            in this    analysis.      Accordingly, we

remand     for the trial   court    to    conduct a   balancing     test based       on   the   facts   of   this   case.   Attorney

fees are not appropriate at this stage of the proceedings, but they may be awarded on remand.

                                                            FACTS


I.        LAYOFFS


          The    County' s    2012 jail budget        projected     a $   935, 000       revenue    loss.      Consequently, on

October 24, 2011, the County informed two corrections officers that they would be laid off on

January 1,     2012.   The County stated that the layoffs were the result of budget reductions. When

the officers informed the Guild of the impending layoffs, the Guild sent a letter to the County

demanding        to bargain the decision to           conduct   layoffs.        The Guild also requested information


related to the County' s budget.

           The   parties met on     November 8, 2011,         and    discussed the         effects of    the layoffs.       After the



meeting, the County sent the Guild a draft letter of understanding,. stating that there would be two
                                                                                                                      layoffs.   The
layoffs    and   allowing for voluntary layoffs in            place       of   the   scheduled     involuntary

Guild responded by clarifying that its original demand letter requested that the County bargain
over   both the decision to         lay   off employees and     the   effects of       that decision. Because the parties



did not reach an agreement on the decision to lay off the officers, which the Guild argued was a

                 subject of   bargaining,      the Guild     requested         further    meetings      with   the    County.    The
mandatory


County agreed to meet again and discuss the effects of the layoffs, but it stated that it believed
the Guild had waived the right to bargain the decision based on provisions in the collective

bargaining agreement and the Guild' s failure to raise bargaining over the decision at the
                                                                2
44183 -7 -II



November meeting.             The parties did not meet again, and the County laid off the two officers on

January 1, 2012.

II.        2010 -12 COLLECTIVE BARGAINING AGREEMENT


           The parties' collective bargaining agreement expired on December 31, 2009, and they

were unable         to   reach an agreement over a new contract.                    The 2007 -09 agreement contained the


following provisions:

           SECTION I— RIGHTS OF MANAGEMENT


           1.     All    management        rights,   powers,     authority        and   functions ...         shall   remain

           vested        exclusively in Employer.               It is expressly recognized that such rights,
           powers,        authority      and   functions include . . .             the right to       establish, change,
           combine or eliminate           jobs,   positions,    job    classifications and       descriptions ... [     and]

           the determination of the number of employees.


Clerk' s Papers ( CP) at 155 -56.
                                                                                          U




           SECTION J— RELATIONSHIP TO CIVIL SERVICE RULES


            1. Except as expressly limited by its terms, nothing in this Agreement shall
           supersede any matter delegated to the Kitsap County Civil Service Commission
           by State law or by ordinance, resolution or laws of or pertaining to the County of
           Kitsap and such Commission shall continue to have primary authority over the
           subjects within         the   scope of    its jurisdiction       and   authority. If there then should be
           a conflict between any provisions of this Agreement and Civil Service, then the
           provisions of this Agreement shall govern.


CP    at   156. The Civil Service Rules              state, "   The Appointing Authority may lay off any employee

in the Classified Service whenever such action is made necessary by reason of a shortage of

work or         funds." CP at 162. The rules also include the process for layoffs and reinstatement.

                                                                                                                                     2
            The     parties   sought       arbitration     over    the      2010 -12      collective    bargaining      agreement.




                         held in                  2012,          the                    issued                in June 2012.    The
Hearings         were               February              and             arbitrator             an   award




2
    The new agreement is not in the record.
                                                                      3
44183 -7 -II




provisions relating to management rights and the Civil Service Rules were not at issue in the

arbitration.

III.       SUPERIOR COURT ACTION


           In June 2012, the County filed a motion for declaratory judgment in superior court,

seeking a declaration that ( 1) the County had no legal duty to bargain the decision to " reduce the

jail budget,     operations, or     staffing levels," ( 2) the Guild' s demand to bargain the decision was an


unfair    labor    practice, (   3) the Guild' s demand to bargain the decision breached the collective


bargaining agreement, and ( 4) under the collective bargaining agreement, the Guild waived its

rights to bargain layoffs resulting from " reductions in the jail' s budget, operations, or staffing

levels."     CP     at   338 -39.    The Guild filed a cross motion for summary judgment, seeking a

declaratory judgment that the layoffs are a mandatory subject of bargaining and that the County
                                                                                                             layoffs.   The
committed an unfair          labor   practice   by   refusing to bargain the decision to           conduct




Guild also sought an injunction barring the County from conducting further layoffs until it

satisfied its obligation to bargain with the Guild.


           The trial court .granted the County' s motion for declaratory judgment and denied the

Guild' s cross motion for summary judgment. The Guild appeals.

                                                         ANALYSIS


I.         JUSTICIABILITY


           The Guild first argues that the County' s claim was not justiciable because it did not

present an actual, present, and existing dispute between the parties. We disagree.

           The     County' s     complaint   alleged     that the Guild demanded to " bargain to impasse the


decision to       reduce   the jail budget,     operations,   or    staffing levels."   CP   at   338.   The Guild argues


that it    never   demanded to bargain          over   the " jail budget,   operations, or    staffing levels "; rather, it

                                                               F.
44183 -7 -II



demanded that the              County bargain " the decision to conduct any layoffs plus any associated

        impacts."
effects /                 Appellant' s Br.       at   12; CP    at   336.    The Guild asserts, therefore, that there is no


present dispute between the parties concerning the County' s budget, operations, or staffing

levels.


          We       review   the   justiciability      of a claim      de    novo.   City of Longview v. Wallin, 174 Wn.

App. 763, 777, 301 P. 3d 45 ( quoting Am. Traffic Solutions, Inc. v. City of Bellingham, 163 Wn.

App.   427, 432, 260 P. 34 245 ( 2011)),                review   denied, 178 Wn.2d 1020 ( 2013).                  A party invoking

the jurisdiction of the court under the Uniform Declaratory Judgment Act must first present a

justiciable controversy.               Wallin, 174 Wn. App. at 777 ( quoting To -Ro Trade Shows v. Collins,

144 Wn.2d 403, 411, 27 P. 3d 1149 ( 2001)).                     A justiciable controversy requires

            1) .         an actual, present[,]         and existing dispute, or the mature seeds of one, as
          distinguished           from    a    possible,      dormant,       hypothetical,     speculative          or   moot

          disagreement, ( 2) between                  parties   having      genuine   and     opposing interests, ( 3)
          which involves interests that must be direct and substantial, rather than potential,
          theoretical, abstract[,] or academic, and ( 4) a judicial determination of which will

          be final and conclusive."


Wallin, 174 Wn.                        777 -78 ( quoting To -Ro Trade Shows, 144 Wn. 2d                     at   411).   Courts must
                          App.    at




liberally construe complaints. CR 8( f).

          Courts        must    liberally     construe    complaints.         CR 8( f).   Here, although the parties each


characterize the dispute differently, the core issue is the same for both parties: whether the

County had          a   mandatory      duty   to bargain the decision to implement layoffs.                      And the County' s

own argument before the trial court included discussion over the justiciable issue of whether the


County    had       a   mandatory      duty   to bargain the decision to            conduct    layoffs.     This is an actual and


present    dispute between the              parties    that   will   continue until    there    is   a   judicial   resolution.   The


County presented a justiciable controversy.

                                                                      5
44183 -7 -II



II.        WAIVER


           The County argues that the Guild contractually waived its rights to bargain over the

layoffs.    We disagree because any waivers expired in 2010 with the former collective bargaining

agreement.




           Waiver is an affirmative defense to a " unilateral change /refusal to bargain" unfair labor

practice.       Pasco Police Officers' Ass' n v. City of Pasco, 132 Wn.2d 450, 463, 938 P. 2d 827

 1997) (    quoting Seattle Police Mgmt. Ass' n v. City of Seattle, No. 8937 -U -90 -1967, 1992 WL

753329,     at *   13 ( Wash. Pub.        Emp' t   Relations Comm' n Sept. 24, 1992)).             The employer bears the


burden     of   proving that the         union     waived bargaining         rights.    Yakima County Law Enforcement

Officer' s Guild v. Yakima County, No. 23986 -U -11 - 6135, 2013 WL 6773512, at * 4 ( Wash. Pub.

          Relations Comm' n Dec. 10, 2013).                   A                   be "`   clear and unmistakable. "'   Pasco.
Emp' t                                                             waiver must




Police Officers' Ass' n, 132 Wn.2d at 462 ( quoting Metro. Edison Co. v. NLRB, 460 U.S. 693,

708, 103 S. Ct. 1467, 75 L. Ed. 2d 387 ( 1983)).                            It must also be knowingly made and must

specifically address the subject upon which the waiver is claimed. Pasco Police Officers' Ass' n,

 132 Wn.2d at 462. A waiver can be found by action, such as agreeing to a contract provision, or

by     inaction,   such as     failing    to   object   to   an act or proposal.        Pasco Police Officers' Ass' n, 132


Wn.2d at 462 ( quoting WSCCCE v. Spokane County, No. 5187 -U -84 -913, 1985 WL 291967, at

  12 ( Wash. Pub.         Emp' t    Relations Comm'            n   Mar. 15,     1985)).     Courts will not find a waiver


      unless it is clear that the parties were aware of their rights and made the conscious choice ...

to    waive   them. "'    Pasco Police Officers' Ass' n, 132 Wn.2d at 462 ( quoting NLRB v. New York

 Tel. Co., 930 F. 2d 1009, 1011 ( 2d Cir. 1991)).

           We must first determine whether the waivers from the 2007 -09 collective bargaining

 agreement were          in   effect at   the time the layoffs           occurred.     During the pendency of proceedings
                                                                     6
44183 -7 -II




before an arbitration panel, existing hours, wages, and working conditions shall not be changed

by   either   party'   s unilateral action.   RCW 41. 56. 470.       But waivers are permissive subjects that


expire with the collective bargaining agreement unless they are renewed by mutual consent. City

of Spokane Managerial &              Prof'l Ass' n v. City of Spokane, No. 23815 -U -11 -6077, 2012 WL

440798,       at *   2 ( Wash. Pub.     Emp' t   Relations Comm' n Feb 8,       2012)     Here, the agreement


containing the alleged waivers had expired in 2010 and the parties had not yet negotiated a new
agreement.           The decision to implement layoffs occurred in October 2011 and the employees


were laid off in January 2012. There is no evidence at the time of the layoffs that the parties had

agreed to renew the alleged waivers. Therefore, the alleged waivers expired in 2010.

         The County additionally argues that the Guild waived its rights to bargain the layoff

decision because it allowed layoffs in the past without demanding the right to bargain the

decision. Although the waivers in the collective bargaining agreement had expired, we may look

to the parties' bargaining history for evidence that the Guild waived the right to bargain the

layoffs.      See Intl Ass' n of Fire Fighters, Local 469 v. City of Yakima, No. 7900 -U -89 -1699,

1991 WL 733702,           at *   13 ( Wash. Pub.   Emp' t   Relations Comm' n 1991).    In 2010, the County laid

off four officers because of budget cuts. The parties met and bargained the effects of the layoffs.

The County implies that the Guild did not demand to bargain the decision, but the record only

contains evidence of the outcome of the bargaining, it does not contain evidence of what the

 Guild demanded to bargain.             The County has the burden of proving that the Guild clearly and

unmistakably waived its bargaining rights. The County has not met its burden here.
 III.      MANDATORY SUBJECT


           Next, the Guild argues that the trial court erred when it denied the Guild' s summary

judgment motion because layoffs are a mandatory bargaining subject and the County committed
                                                              7
44183 -7 -II



an unfair    labor    practice when      it   refused   to bargain the decision to        lay   off   two   officers.   Because


the trial court failed to first conduct the balancing test to determine whether the layoffs in this

case are mandatory or permissive subjects, we hold that the trial court erred and remand for the

court to conduct the balancing analysis.

          We review a summary judgment order de novo, engaging in the same inquiry as the trial

court.    Folsom      v.   Burger   King,     135 Wn.2d 658, 663, 958 P. 2d 301 ( 1998).                Summary judgment

is appropriate when there is no genuine issue of material fact and the moving party is entitled to

judgment     as a matter of         law. CR 56( c); Folsom, 135 Wn.2d           at   663.       We construe the facts and


reasonable        inferences in favor        of   the nonmoving party.     Korslund v. DynCorp Tri- Cities Servs.,

Inc., 156 Wn.2d 168, 177, 125 P. 3d 119 ( 2005).                  Summary judgment is appropriate if reasonable

persons could reach          only    one conclusion      from the     evidence presented.        Korslund, 156 Wn.2d at


177.


          There are three broad categories of collective bargaining subjects: mandatory, permissive,

and    illegal.    Yakima County v. Yakima County Law Enforcement Officers' Guild, 174 Wn. App.

171, 181, 297 P. 3d 745 ( quoting Patrol Lieutenants Ass' n v. Sandberg, 88 Wn. App. 652, 657,

946 P. 2d 404 ( 1997)),        review    denied, 178 Wn.2d 1012 ( 2013).             Parties to a collective bargaining

agreement must bargain in good faith on mandatory subjects; they may bargain on permissive

subjects, but they are not obliged to bargain to impasse. Sandberg, 88 Wn. App. at 657 (quoting
Pasco Police Officers' Ass'             n,    132 Wn.2d     at   460).   Even if an employer makes a unilateral


decision regarding a permissive bargaining subject, the employer is still required to bargain over

the effects of the decision on mandatory bargaining subjects. Pub. Sch. Emps. of Wash. v. Wash.

State Univ., No. 24440 - - - 6258, 2013 WL 1561271,
                       U 11                                                   at *   2(   Wash. Pub. Emp' t Relations

Comm' n Apr. 9, 2013).

                                                                 N.
44183 -7 -II




         Mandatory bargaining subjects include wages, hours, and working conditions. Klauder v.

San Juan        County Deputy             Sheriffs'       Guild, 107          Wn.2d         338,    341;    728     P. 2d    1044 ( 1986).


Permissive       bargaining        subjects          include "[    m]        agerial decisions that only remotely affect

personnel matters,'         and    decisions that         are   predominantly ` managerial                 prerogatives. "'    Int' l Ass' n


of Fire Fighters, Local Union 1052 v. Pub. Emp' t Relations Comm' n, 113 Wn.2d 197, 200, 778
P. 2d 32 ( 1989).       It is an unfair labor practice to refuse to bargain a mandatory subject to impasse.

and   to demand to        argue a permissive subject                to impasse.             RCW 41. 56. 140( 4);           Yakima County,

174 Wn. App. at 182.

         Where an issue involves both mandatory and permissive subjects, courts use a balancing

test to determine        whether     it is mandatory            or permissive.             Yakima County, 174 Wn. App. at 1,82.

 On   one side of       the balance       is the relationship the            subject       bears to ` wages, hours[,] and working


conditions.'        On the         other       side    is the     extent      to    which     the    subject       lies ` at the core of


entrepreneurial         control'    or    is    a   management prerogative."                   Intl Ass' n of Fire Fighters, 113

Wn. 2d     at   203 (   quoting Spokane Educ. Ass' n v. Barnes, 83 Wn.2d 366, 376, 517 P. 2d 1362

 1974)).        Where the subject both relates to conditions of employment and is a management

prerogative,      the court       must     determine       which        characteristic        predominates.          Int' l Ass' n of Fire

Fighters, 113 Wn.2d          at    203.        This involves a case -by -case analysis. Int' l Ass' n ofFire Fighters,

113 Wn.2d at 203.


           In International Ass' n of Fire Fighters, our Supreme Court held that the Washington

Public Employees Relations Commission ( PERC) erred when it determined that a subject was

permissive       without     first conducting the               balancing          test.     113 Wn.2d        at    207.     There, PERC


concluded,        and the superior court affirmed, that equipment staffing was a nonmandatory


bargaining       subject.    Intl Ass'         n    of Fire Fighters, 113 Wn.2d 202.                   In reaching this conclusion,
                                                                         9
44183 -7 -II




PERC did not balance the specific facts relating to the management prerogatives at issue and the

decision' s impact on working conditions; instead, it declared, based on previous decisions, that

equipment staffing was a nonmandatory subject. Int' l Ass' n ofFire Fighters, 113 Wn.2d at 202.

The   court    held that PERC      erred      by failing   to   conduct a   fact -
                                                                                 specific     balancing,     noting, "[ e] very


case presents unique circumstances, in which the relative strengths of the public employer' s need


for managerial control on the one hand, and the employees' concern with working conditions on

the   other,   will   vary."    Int' l Ass'   n   of Fire Fighters, 113 Wn:2d            at   207.       Therefore, the court


remanded       for PERC to       conduct       the   proper     balancing   test.    Int' l Ass' n of Fire Fighters, 113

Wn.2d at 207.


         The trial court in this case similarly failed to balance on the record the County' s

management prerogatives             against       the   layoffs' impact     on   working      conditions.      Arguably, the

layoffs heavily impact employees' working conditions, but, on these facts, the County' s duty to

implement        a   budget    weighs    on   the    management        prerogative    side    of   the   balance.   With such


significant interests on each side of the balance, it is important that the trial court carefully

consider the specific facts of this case and balance the competing interests.

            The trial court erred when it failed to conduct the balancing test to determine whether the

layoffs in this situation are mandatory or permissive bargaining subjects. We remand for the trial

court to engage in the balancing analysis.

IV.         ATTORNEY FEES


            The Guild    requests       attorney fees      on    appeal under       RCW 49. 48. 030.         RCW 49. 48. 030


states, "   In any action in which any person is successful in recovering judgment for wages or

salary owed to him or her, reasonable attorney' s fees, in an amount to be determined by the
court,   shall   be   assessed against said employer."             Because we are remanding to the trial court for
                                                                  10
44183 -7 -II




further proceedings, the Guild has not yet successfully recovered employee wages or salaries.

Attorney fees may be appropriate on remand, but they are not recoverable here under RCW

49. 48. 030.


        We remand for the trial court to conduct a balancing test based on the facts of this case.
                                                                      r




                                                             fienoya , TP .T.

We concur:




        Maxa, J.




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