BILL REQ. #:  H-0430.2 

Read first time 01/20/11.   Referred to Committee on Labor & Workforce Development.

     AN ACT Relating to making interest arbitration panel determinations related to local government; amending RCW 41.56.450 and 41.56.465; and creating a new section.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1   The state, under chapter 41.56 RCW, has established guidelines and factors to be considered in determining interest arbitration decisions setting compensation and benefit spending levels for certain public employees. These factors include the selection of an arbitration panel and neutral chair to make final and binding determinations upon the parties subject to this chapter. Additionally, these guidelines include criteria which the arbitration panel must consider in making a determination.
     The legislature finds that it is necessary to further define the qualifications of the neutral chair of an arbitration panel to ensure that determinations made by the panel are fair and just, based on a full understanding of the factors presented.
     Additionally, the legislature finds it in the interest and welfare of the public for the arbitration panel to consider the financial ability of the respective unit of government when making a determination.

Sec. 2   RCW 41.56.450 and 1983 c 287 s 2 are each amended to read as follows:
     (1) If an agreement has not been reached following a reasonable period of negotiations and mediation, and the executive director, upon the recommendation of the assigned mediator, finds that the parties remain at impasse, then an interest arbitration panel shall be created to resolve the dispute. The issues for determination by the arbitration panel shall be limited to the issues certified by the executive director. Within seven days following the issuance of the determination of the executive director, each party shall name one person to serve as its arbitrator on the arbitration panel. The two members so appointed shall meet within seven days following the appointment of the later appointed member to attempt to choose a third member to act as the neutral ((chairman)) chair of the arbitration panel. Upon the failure of the arbitrators to select a neutral ((chairman)) chair within seven days, the two appointed members shall use one of the two following options in the appointment of the third member, who shall act as ((chairman)) chair of the panel: (((1))) (a) By mutual consent, the two appointed members may jointly request the commission to, and the commission shall, appoint a third member within two days of such request. Costs of each party's appointee shall be borne by each party respectively; other costs of the arbitration proceedings shall be borne by the commission; or (((2))) (b) either party may apply to the commission, the federal mediation and conciliation service, or the American arbitration association to provide a list of five qualified arbitrators from which the neutral ((chairman)) chair shall be chosen. Each party shall pay the fees and expenses of its arbitrator, and the fees and expenses of the neutral ((chairman)) chair shall be shared equally between the parties.
     The arbitration panel so constituted shall promptly establish a date, time, and place for a hearing and shall provide reasonable notice thereof to the parties to the dispute. A hearing, which shall be informal, shall be held, and each party shall have the opportunity to present evidence and make argument. No member of the arbitration panel may present the case for a party to the proceedings. The rules of evidence prevailing in judicial proceedings may be considered, but are not binding, and any oral testimony or documentary evidence or other data deemed relevant by the ((chairman)) chair of the arbitration panel may be received in evidence. A recording of the proceedings shall be taken. The arbitration panel has the power to administer oaths, require the attendance of witnesses, and require the production of such books, papers, contracts, agreements, and documents as may be deemed by the panel to be material to a just determination of the issues in dispute. If any person refuses to obey a subpoena issued by the arbitration panel, or refuses to be sworn or to make an affirmation to testify, or any witness, party, or attorney for a party is guilty of any contempt while in attendance at any hearing held hereunder, the arbitration panel may invoke the jurisdiction of the superior court in the county where the labor dispute exists, and the court has jurisdiction to issue an appropriate order. Any failure to obey the order may be punished by the court as a contempt thereof. The hearing conducted by the arbitration panel shall be concluded within twenty-five days following the selection or designation of the neutral ((chairman)) chair of the arbitration panel, unless the parties agree to a longer period.
     The neutral ((chairman)) chair shall consult with the other members of the arbitration panel, and, within thirty days following the conclusion of the hearing, the neutral ((chairman)) chair shall make written findings of fact and a written determination of the issues in dispute, based on the evidence presented. A copy thereof shall be served on the commission, on each of the other members of the arbitration panel, and on each of the parties to the dispute. That determination shall be final and binding upon both parties, subject to review by the superior court upon the application of either party solely upon the question of whether the decision of the panel was arbitrary or capricious.
     (2) An arbitrator serving as neutral chair for cases under interest arbitration under this section shall be considered qualified if the arbitrator can demonstrate all of the following:
     (a) Current membership in one of the following organizations: National academy of arbitrators; American arbitration association; or federal mediation and conciliation services;
     (b) A minimum of eight hours of training in the area of public sector fiscal and budgetary matters. The commission is directed to develop or certify qualifying training programs in consultation with labor and management representatives; and
     (c) Is geographically located in the northwest region of the United States.

Sec. 3   RCW 41.56.465 and 2007 c 278 s 1 are each amended to read as follows:
     (1) In making its determination, the panel shall be mindful of the legislative purpose enumerated in RCW 41.56.430 and, as additional standards or guidelines to aid it in reaching a decision, the panel shall consider the following criteria, but give first priority to (a) and (b) of this subsection and secondary priority to (c) through (f) of this subsection:
     (a) The constitutional and statutory authority of the employer;
     (b) The reasonable financial ability of the employer to pay for the compensation and fringe benefit provisions of a collective bargaining agreement giving due consideration and weight to the other services provided by, and other priorities of, the unit of government as determined by the governing body. A reasonable operating reserve against future contingencies as determined by the governing body, which does not include funds in contemplation of settlement of the labor dispute, shall not be considered as available toward a settlement;
     (c) Stipulations of the parties;
     (((c))) (d) The average consumer prices for goods and services, commonly known as the cost of living;
     (((d))) (e) Changes in any of the circumstances under (a) through (((c))) (d) of this subsection during the pendency of the proceedings; and
     (((e))) (f) Such other factors, not confined to the factors under (a) through (((d))) (e) of this subsection, that are normally or traditionally taken into consideration in the determination of wages, hours, and conditions of employment. For those employees listed in RCW 41.56.030(((7))) (14)(a) who are employed by the governing body of a city or town with a population of less than fifteen thousand, or a county with a population of less than seventy thousand, consideration must also be given to regional differences in the cost of living.
     (2) For employees listed in RCW 41.56.030(((7))) (14) (a) through (d), the panel shall also consider a comparison of the wages, hours, and conditions of employment of personnel involved in the proceedings with the wages, hours, and conditions of employment of like personnel of like employers ((of similar size)) on the west coast of the United States. However, when an adequate number of comparable employers exists within the state of Washington, other west coast employers may not be considered. Like employers shall be determined by factors including, but not limited to, population size, geographic location, financial conditions, population demographics, workforce size, assessed valuation, and labor market characteristics.
     (3) For employees listed in RCW 41.56.030(((7))) (14) (e) through (h), the panel shall also consider a comparison of the wages, hours, and conditions of employment of personnel involved in the proceedings with the wages, hours, and conditions of employment of like personnel of public fire departments ((of similar size)) on the west coast of the United States. However, when an adequate number of comparable employers exists within the state of Washington, other west coast employers may not be considered. Like public fire departments shall be determined by factors including, but not limited to, population size, geographic location, financial conditions, population demographics, workforce size, assessed valuation, and labor market characteristics.
     (4) For employees listed in RCW 41.56.028:
     (a) The panel shall also consider:
     (i) A comparison of child care provider subsidy rates and reimbursement programs by public entities, including counties and municipalities, along the west coast of the United States; and
     (ii) The financial ability of the state to pay for the compensation and benefit provisions of a collective bargaining agreement; and
     (b) The panel may consider:
     (i) The public's interest in reducing turnover and increasing retention of child care providers;
     (ii) The state's interest in promoting, through education and training, a stable child care workforce to provide quality and reliable child care from all providers throughout the state; and
     (iii) In addition, for employees exempt from licensing under chapter 74.15 RCW, the state's fiscal interest in reducing reliance upon public benefit programs including but not limited to medical coupons, food stamps, subsidized housing, and emergency medical services.
     (5) For employees listed in RCW 74.39A.270:
     (a) The panel shall consider:
     (i) A comparison of wages, hours, and conditions of employment of publicly reimbursed personnel providing similar services to similar clients, including clients who are elderly, frail, or have developmental disabilities, both in the state and across the United States; and
     (ii) The financial ability of the state to pay for the compensation and fringe benefit provisions of a collective bargaining agreement; and
     (b) The panel may consider:
     (i) A comparison of wages, hours, and conditions of employment of publicly employed personnel providing similar services to similar clients, including clients who are elderly, frail, or have developmental disabilities, both in the state and across the United States;
     (ii) The state's interest in promoting a stable long-term care workforce to provide quality and reliable care to vulnerable elderly and disabled recipients;
     (iii) The state's interest in ensuring access to affordable, quality health care for all state citizens; and
     (iv) The state's fiscal interest in reducing reliance upon public benefit programs including but not limited to medical coupons, food stamps, subsidized housing, and emergency medical services.
     (6) Subsections (2) and (3) of this section may not be construed to authorize the panel to require the employer to pay, directly or indirectly, the increased employee contributions resulting from chapter 502, Laws of 1993 or chapter 517, Laws of 1993 as required under chapter 41.26 RCW.