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American Federation of State, County, and Municipal Employees v. Illinois Labor Relations Board

Court of Appeals of Illinois, Fifth District

November 8, 2017

AMERICAN FEDERATION OF STATE, COUNTY, AND MUNICIPAL EMPLOYEES, COUNCIL 31, Petitioner,
v.
THE ILLINOIS LABOR RELATIONS BOARD and THE STATE OF ILLINOIS DEPARTMENT OF CENTRAL MANAGEMENT SERVICES, Respondents.

         Petition for Review of an Order of the Illinois Labor Relations Board, State Panel. No. S-CA-16-007

          Attorneys for Appellant Stephen A. Yokich, George A. Luscombe III, Dowd, Bloch, Bennett, Cervone, Auerbach & Yokich, 8 South Michigan Avenue, 19th Floor, Chicago, IL 60603

          Attorneys for Appellees Jeffrey S. Fowler, Lawrence Jay Weiner, Special Assistant Attorneys General, Laner Muchin, Ltd., 515 North State Street, Suite 2800, Chicago IL 60654 (attorneys for Illinois Department of Central Management Services); Lisa Madigan, Attorney General, State of Illinois, David L. Franklin, Solicitor General, Frank H. Bieszczat, Assistant Attorney General, 100 West Randolph Street, 12th Floor, Chicago, IL 60601 (attorneys for Illinois Labor Relations Board)

          JUSTICE CHAPMAN delivered the judgment of the court, with opinion. Justices Goldenhersh and Cates concurred in the judgment and opinion.

          OPINION

          CHAPMAN JUSTICE

         ¶ 1 The petitioner, the American Federation of State, County, and Municipal Employees, Council 31 (AFSCME), appeals a decision of the Illinois Labor Relations Board (ILRB) dismissing its unfair labor charge against the State of Illinois Department of Central Management Services (CMS). The charge challenged a policy requiring employees to pay the entire cost of their health insurance premiums for any pay period during which they go on strike, even if they are not on strike for the entire pay period. The charge was dismissed without a hearing. AFSCME argues that the ILRB abused its discretion because AFSCME presented sufficient evidence to warrant a hearing on its claims that (1) the policy was a unilateral change to a term of employment instituted at a time when the parties were in negotiations for a new contract and (2) the policy improperly threatened to penalize employees for lawfully exercising their right to strike.

         ¶ 2 After briefing was complete in this appeal, CMS filed motions asking this court to take judicial notice of unrelated proceedings between the same parties pending in other courts. In those proceedings, AFSCME argued that the procedures followed by the ILRB violated the Open Meetings Act (5 ILCS 120/1 et seq. (West 2014)), which meant that its decision was not a final order. In the motions to take judicial notice it filed in this case, CMS argued that the position AFSCME took in the other proceedings was contrary to its assertion here that this court has jurisdiction. CMS also filed a motion asking this court to remand this matter to the ILRB to allow the ILRB to conduct additional proceedings that would eliminate any Open Meetings Act problem. Although none of the parties challenge our jurisdiction over this matter, the question of our jurisdiction is implicated by CMS's motions, and we will therefore address it. We find that we have jurisdiction to hear this appeal; we grant CMS's motion to take judicial notice; we deny CMS's motion to remand; and we reverse the decision of the ILRB.

         ¶ 3 On July 27, 2015, AFSCME filed the unfair labor charge against CMS that forms the basis of this appeal. In the charge, AFSCME alleged as follows: In June 2015, while the parties were in negotiations for a new collective bargaining agreement, CMS posted a list of frequently asked questions (FAQs) on its website. One of the questions concerned the payment of health insurance premiums for employees who go on strike. The posted response indicated that employees engaged in a strike would be required "to immediately pay the full cost of their health insurance" premiums. AFSCME further alleged that the State continues to pay its share of the premiums during other types of unpaid absences.

         ¶ 4 In the charge, AFSCME argued that the policy set forth in the FAQ response violates section 10(a)(1) and section 10(a)(2) of the Illinois Public Labor Relations Act (Labor Relations Act) (5 ILCS 315/10(a)(1), (2) (West 2014)). AFSCME argued that the policy discriminates against employees for going on strike, an activity protected under the Labor Relations Act, because it treats striking employees differently from other employees who go on unpaid leave.

         ¶ 5 Attached to the charge were a printout of the FAQs posted on the CMS website and a copy of portions of the State of Illinois employee benefits handbook. The relevant question and response read as follows:

"Q. Will striking employees still receive health insurance?
A. Yes, but striking employees will be responsible for the full cost of their health insurance, including the amount normally contributed by the State on behalf of the employee. If striking employees miss any day during the pay period due to being on strike, they will be sent a bill for the full cost of their coverage." https://www.illinois.gov/employeefaqs/pages/default.aspx

         The employee benefits handbook contained rules governing eligibility for the employer contribution to health insurance for several types of unpaid leaves of absence. It showed that employees remain eligible for the employer contribution to their health insurance premiums during many, but not all, types of unpaid leave. It did not address the responsibility for paying health insurance premiums when employees go on strike.

         ¶ 6 The unfair labor charge was assigned to ILRB member Michael Provines for investigation. In July and August of 2015, Provines corresponded by e-mail with attorneys from AFSCME and CMS to clarify the issues to be considered. During that correspondence, counsel for AFSCME argued that the policy in the FAQ constituted an unfair labor practice for three reasons. First, the policy acts as a threat to dissuade employees from striking because its message to employees is that if they go on strike, even for one day, they would be required to pay the full amount of their health insurance premiums for the entire pay period. See 5 ILCS 315/10(a)(1) (West 2014). Second, the policy constitutes a unilateral unbargained-for change in a term of employment-health insurance. See 5 ILCS 315/10(a)(4) (West 2014); Vienna School District No. 55 v. Illinois Educational Labor Relations Board, 162 Ill.App.3d 503, 506-07 (1987) (citing National Labor Relations Board v. Katz, 369 U.S. 736, 743-47 (1962)). Third, the policy discriminates against employees who go on strike because other employees on unpaid leaves of absence do not have to pay the employer's share of their health insurance premiums. See 5 ILCS 315/10(a)(2) (West 2014).

         ¶ 7 On September 15, 2015, CMS sent a letter to Provines that served as its response to the unfair labor charge. It argued that communicating its policy to its employees is protected as free speech under section 10(c) of the Labor Relations Act. See 5 ILCS 315/10(c) (West 2014). CMS also argued that the policy is not an unfair labor practice. CMS noted that an employer is not required to subsidize a strike. It pointed out that, consistent with this principle, the reply to another FAQ on the website indicates that striking workers would not be paid during a strike, a policy the union does not challenge. CMS argued that the policy concerning health insurance premiums was no different from the policy concerning wages. Finally, CMS argued that the policy expressed in the FAQ was not a new policy and therefore did not change a term or condition of employment during contract negotiations. In support of this argument, CMS alleged that during a 2004 strike by employees of Northeastern Illinois University, the policy was applied to those striking workers. Attached as an exhibit was a chart of the "pay codes" used by CMS for various types of leaves of absence, including strikes. The chart indicates that striking employees are "100% responsible" for their health insurance premiums. It does not address whether those employees are responsible for their entire premiums only for the duration of the strike or for the remainder of the pay period as well.

         ¶ 8 In further e-mail correspondence, Provines asked counsel for CMS whether employees are coded as "on strike" for the entire pay period, regardless of how many days they are on strike, and, if so, why. Counsel indicated that the pay codes apply to entire pay periods, regardless of the duration of the strike. He explained that it was "practically impossible" for the payroll system to prorate health insurance premiums. He noted that other pay codes for unpaid leaves of absence are handled the same way.

         ¶ 9 Provines forwarded the pleadings and correspondence to Executive Director Melissa Mlynski, who issued a decision and recommended order on October 27, 2015. She found that negotiations for a new collective bargaining agreement began in February 2015 and that the FAQ response was first posted in June 2015. She further found that the employees represented by AFSCME in the affected bargaining units were not then on strike and had never gone on strike. She also noted that, although AFSCME never filed an amended charge, CMS had actual notice of all three of its arguments. She therefore considered all three.

         ¶ 10 Mlynski first analyzed AFSCME's contention that the policy discriminates against employees for engaging in a strike, a protected activity under the Labor Relations Act. See 5 ILCS 315/10(a)(2) (West 2014). She explained that to prevail on such a claim, the union must show that the employees actually engaged in protected activity (such as a strike); that the employer was aware of their activity; and that the employer took an adverse action against the employees. She concluded that because the bargaining units at issue had never gone on strike and the policy had never been applied to them, AFSCME's charge failed to state a claim under section 10(a)(2).

         ¶ 11 Mlynski next considered AFSCME's claim that CMS made a unilateral change to a term of employment when it announced the policy in the FAQ. She noted that AFSCME, as the charging party, had the burden of showing at least some evidence that CMS had unilaterally changed a term of employment in order to be entitled to a hearing on this issue. Pointing to CMS's assertion that the 2004 Northeastern Illinois University strike was handled in the manner described in the FAQ, she found that AFSCME did not present sufficient evidence to warrant a hearing on this issue.

         ¶ 12 Finally, Mlynski considered AFSCME's claim that the policy violates section 10(a)(1) by threatening or dissuading employees from striking. In rejecting this claim, she pointed to the State's policy of not paying the salaries of striking employees while they are on strike, a policy the union did not challenge. She found that the policy concerning health insurance premiums was no ...


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