HomeMy WebLinkAbout12 Letter of Referral Regarding MOU GrievanceTRUCKEE DONNER
Public Utility District
ACTION
To:
Board of Directors
From:
Brian Wright
Date:
May 20, 2020
Subject: Consideration of Letter of Referral Submitted by IBEW 1245
Regarding MOU Grievance
1. WHY THIS MATTER IS BEFORE THE BOARD
Step 3 of Section 14.4,Grievance Procedure Steps, of Title 14, Grievance Procedure
of the Memorandum of Understanding (MOU) between the District and IBEW 1245
includes provisions for the Board's written response to a grievance submitted by an
employee or an employee organization official if desired by the employee.
2. HISTORY
The majority of the District's operations, maintenance and administrative staff (non-
exempt employees) is a bargaining unit that is represented by the International
Brotherhood of Electrical Workers (IBEW) Local 1245. The District and IBEW 1245
have maintained a Memorandum of Understanding (MOU) since May 1, 1967. The
previous MOU with IBEW Local 1245 became effective on January 1, 2016 and
expired on December 31, 2019.
In November and December of 2019, the District's labor negotiating team met with
IBEW business representatives and the Local 1245 negotiating committee (District
bargaining unit employees) to negotiate the terms of the new MOU. On December 12,
2019 the District and IBEW arrived at a tentative agreement on all proposed
modifications, pending ratification by majority vote from IBEW Local 1245 membership
and approval by the Board. In the interest of honoring the tentative agreement, all of
the new provisions within the MOU were implemented and made effective January 1,
2020.
On February 5, 2020, IBEW 1245 submitted a grievance to the District on the grounds
that the District failed to uphold the terms of Title 19, Employee Benefit Program. The
grievance reveals a material difference in interpretation by the District and IBEW Local
1245 as to the applicability of the MOU to previously retired employees of the District.
District staff holds the position that during negotiations, compensation and benefits are
provisions that were negotiated on behalf of current employees only. IBEW 1245
represents the bargaining unit, which is comprised of current employees. It does not
include former employees, including those who have retired from the District.
Therefore, District staff had no expectation or reasonable basis upon which to believe
that in negotiating with IBEW 1245 that it was negotiating compensation and benefits
for anyone other than those persons who are members of the bargaining unit. In other
words, there was no expectation or basis upon which to believe that it was bargaining
for benefits for anyone who is not a member of the bargaining unit, i.e. - retirees..
At no point during the negotiations did the IBEW 1245, the District's negotiating team
or the Board of Directors indicate or suggest that any of the negotiations were being
conducted on behalf of non -bargaining unit or previous employees. In the context of
the grievance submitted by IBEW 1245 on April 14th, this includes increases in the
District's monthly contribution to post retirement benefits. This holds true with other
negotiated provisions such as wage increases, increases in employee monthly
contributions to group medical insurance plans and other economic benefits.
On February 20, 2020, the District and IBEW 1245 held an informal meeting to
discuss the difference in interpretation of Title 19, and its potential impact on the
timely approval of the MOU. Neither party conceded its position in terms of the
applicability of newly negotiated benefits to previously retired employees. Subsequent
to this meeting, a second informal meeting was held between the District and IBEW
1245 with the intent of finding resolution to the disputed item and proceed with the
timely approval of the new MOU. In this meeting both parties agreed that advisory
arbitration, as provided in Title 14 of the MOU, was the appropriate means for seeking
resolution.
The parties entered into a "Side Letter Agreement" whereby they agreed to resolve
their difference without further meet and confer and by allowing the Board to adopt the
proposed MOU without either party waiving its respective position on the disputed
issue. The Side Letter Agreement has been included with this staff report as
Attachment 2. Following final review, IBEW ratified the proposed MOU on February
25, 2020.
At the March 18, 2020 meeting, the Board approved the MOU and acknowledged the
Side Letter Agreement.
3. NEW INFORMATION
On April 14, 2020 the District received a second grievance from IBEW 1245 that was
substantially the same as the grievance received on February 5, 2020. The Grievance
received from IBEW 1245 on April 14, 2020 has been included with this Staff Report
as Attachment 1. In accordance with Step 2 of the Grievance Procedures outlined in
Title 14 of the MOU, the District responded to IBEW 1245 on April 15, 2020, stating
that the District's position on the disputed item had not changed and that subsequent
to the initial grievance submitted on February 5, 2020, both parties had agreed to find
resolution through advisory arbitration.
On May 5, 2020, in accordance with Step 3 of the Grievance Procedures outlined in
Title 14 of the MOU, IBEW 1245 submitted to the Board a Letter of Referral for
consideration of the grievance submitted on April 14, 2020. The Letter of Referral has
been included with this Staff Report as Attachment 2. Not only was the Letter of
Referral submitted in contravention of the Side Letter Agreement, it was submitted the
day before the May 6, 2020 Board meeting and after the agenda for the meeting had
been posted. Therefore, the Board would not have been able to hear and decide on
the Letter of Referral within 10 days as required by the MOU.
Regardless of the fact that it was submitted in contravention of the Side Letter
Agreement, the District informed IBEW 1245 that if it wanted the Board to consider the
Referral Letter, it would need to waive the 10-day period in writing. IBEW 1245
waived the 10-day period. A copy of the District's letter and IBEW 1245's response
are included with this Staff Report as Attachments 3 and 4, respectively.
It should be noted that there are multiple inaccuracies within the Letter of Referral,
most significantly:
• In paragraph 5 of the letter, IBEW 1245 Business Representative, Mike
Venturino indicates that during an informal meeting held on February 20, 2020
"Mr. Holley conveyed in confidence that the cancellation of payment to current
retirees was due to outside pressure from unrepresented retirees." This is
entirely inaccurate. During the meeting, IBEW 1245 was informed that the
previous retirees were never intended to receive the increased post retirement
benefit, that Staff had mistakenly distributed the increased contributions to
existing retirees in January 2020, and once the mistake was identified, the
contribution amounts were corrected. Furthermore, IBEW 1245 was informed
that former unrepresented retirees were in fact collaborating with former union
retirees to protest the action jointly.
The options under consideration by the Board include the following:
1.) Reject the grievance submitted by IBEW 1245 on April 14, 2020, at which point
IBEW 1245 would have the option, in accordance with Step 4 of the Grievance
Procedures outlined in Title 14 of the MOU, to submit the grievance to non -binding
advisory arbitration within twenty (20) days. The arbitrator shall then provide a written
recommendation to the Board. The Board would then have ten (10) days to provide a
final written decision; or
2.) Accept the grievance submitted by IBEW 1245 as valid, thereby affirming the
position that IBEW 1245 represents past employees and direct staff to increase the
District's post retirement medical benefit contributions for existing employees, effective
January 1, 2020.
In making a determination as to how to proceed in this matter, the Board may wish to
consider some of the following contributing factors:
Generally speaking, labor negotiations between the District and the employee's
collective bargaining unit are conducted under the pretext that newly agreed
upon provisions are intended for the benefit of retaining current employees and
the recruitment of future employees. The negotiation process includes
compromises in providing monetary increases to some provisions within the
compensation and benefits package as well as cost containment or employee
contributions to other provisions within the package. Past employees are not
represented at the table and therefore are not subject to either side of the
compromises agreed upon, whether those are increases in provisions or
additional costs to the employees. Employees who retire from the District are
subject to the compensation and benefits package, and all other provisions
available and which had been agreed upon and in place at the time of
retirement. Subsequent negotiations, agreements and MOUs do of apply to
individuals not employed by the District or in this case who are no longer
members of the collective bargaining unit at the time of the agreement unless
otherwise explicitly agreed upon. Former employees and retirees are not
members of IBEW 1245 and do not pay dues, so it is curious as to why IBEW
1245 takes the position that it bargained on behalf of them.
Title 14 of the MOU, Grievance Procedures stipulates that an employee, and/or
an employee organization official if desired by the employee, shall refer the
issue in witting. The District contends that both the original grievance received
on February 5, 2020, and the second grievance received on April 14, 2020
have been submitted by IBEW 1245 on behalf of ex -employees, not
employees, who are no longer members of the collective bargaining unit, and
therefore not covered by the current MOU. In other words, the Union had no
standing to submit these grievances. During the informal meeting held
between the District's labor negotiating team and IBEW 1245 representatives,
Staff indicated that one of the contributing factors of the dispute is whether
IBEW 1245 had standing to submit the grievance, as it has been submitted on
behalf of a group IBEW 1245 does not represent. Moving directly to advisory
arbitration was recommended during this meeting to determine the validity of
the grievance and avoid re -opening negotiations which would have financial
implications to represented employees.
During the negotiations, the District's negotiating team received parameters
from the Board to include modest increases in the District's contribution to
employees monthly post retirement medical benefits in exchange for cost
containment measures in the form of monthly employee contributions to group
medical insurance plans. Neither of these provisions were intended to be
applied to previously retired employees.
4. FISCAL IMPACT
The direct fiscal impact associated with this item is not yet known, as it is dependent
upon the direction provided by the Board. The following potential fiscal impacts have
been outlined for consideration:
If the grievance is rejected there will be no direct fiscal impact associated with
this item. The District will be subject to equal share with the collective
bargaining unit for the cost of advisory arbitration should IBEW 1245 choose to
pursue that option. The actual cost of arbitration is not known at this time.
If the grievance is accepted and the Board determines it appropriate to apply
the negotiated increases in the District's contributions to post retirement
medical benefits to all past retirees, there will be an estimated annual increase
in the District's Other Post Employment Benefits (OPEB) of approximately
$50,000 - $75,000/year. This annual cost estimate is dependent upon the
number of retirees in the program and eligible contributions each year.
5. RECOMMENDATION
Staff recommendation is to reject the grievance submitted by IBEW 1245 on April 14,
2020.
Brian Wright
Water Utility Director/Assistant GM
Michael D. Holley
General Manager
Attachment 1
May 5, 2020
Jeff Bender
Board President, TDPUD Board of Directors
Truckee Donner PUD
11570 Donner Pass Road
Truckee, CA 96161
Dear Mr. Bender,
As you may be aware, IBEW 1245 and Truckee Donner PUD are currently in dispute over the
applicability of the recently negotiated, December 2019, retiree medical cap increase contained
in Title 19 of the Memorandum of Understanding between IBEW 1245 and TDPUD.
The retiree medical cap increase was included in a Tentative Agreement (TA), that was
presented to and agreed upon by the Board from the District's outside counsel, Joe Wiley, on
December 12, 2019, the last day of bargaining. With the understanding of approval of the TA
from the Board, at the Union's next unit meeting on December 17, 2019, a ratification vote was
held, and the TA was successfully passed by the Union membership.
On January 1, 2020, the economic provisions of the TA, approved by the Board and accepted by
the membership, were implemented by the District, including the retiree medical cap increase,
which was accordingly, paid to all retirees. In early February 2020, the Union became aware
that the District would not continue to pay the retiree medical cap increase to current retirees,
in contravention of what was bargained and ratified by the Union's membership.
Consequently, on February 5, 2020, a grievance was filed on behalf of the retirees. This led to
the discovery that although the Board had approved and agreed to the TA, it had not been
"formally adopted" in an open meeting, which made the grievance premature. Based on this
information, the Union withdrew its grievance on February 12, 2020, with the intention of
refiling once the dispute became ripe. On the morning of February 20, 2020, an informal
meeting was scheduled to discuss the issue. In attendance were General Manager Michael
Holley, Water Utility Director Brian Wright, IBEW 1245 Assistant Business Manager Al Fortier
and IBEW 1245 Business Representative Mike Venturino.
During the meeting, Mr. Holley conveyed in confidence that the cancellation of payment to
current retirees was due to outside pressure from unrepresented retirees. He further stated
that the Board was inclined not to approve the TA until the parties had resolved the
discrepancy. However, no resolution was reached at that meeting.
Another meeting was scheduled for February 25, 2020, to further discuss the issue. The
attendees included outside counsel for the District, Joe Wiley, Water Utility Director Brian
Wright, Electric Utility Director Joe Horvath, IBEW Assistant Business Manager Al Fortier and
Business Representative Mike Venturino. During the meeting, the parties agreed that they
would execute a side letter agreement that would include terms for resolving the retiree
medical cap increase through the grievance process, so that the TA could be adopted by the
Board. This was executed by the District and the Union on March 3, 2020 and March 5, 2020,
respectively.
With the side letter agreement in place, the TA was finally presented to and adopted by the
Board at its March 18, 2020 meeting. Following the adoption of the TA by the Board, the Union
refilled its grievance on behalf of the retirees on April 14, 2020. In accordance with Title 14 of
the MOU, the Union requested an informal meeting with the General Manager to discuss the
grievance. It was the Union's expectation, based on the language of Title 14, that it would
receive a response from the General Manager regarding this request. However, on April 15,
2020 the Union received acknowledgement of receipt the grievance from Brian Wright, Acting
General Manager — not Michael Holley, General Manger — referring the matter to the District's
outside counsel, Joe Wiley.
In his April 16, 2020 response, Mr. Wiley states that "rather than go through the traditional
steps of the grievance procedure, and based upon our side letter on the issue, I recommend
that we proceed directly to arbitration." His proposal to expedite the grievance to arbitration,
however, is not what the parties agreed to in the side letter agreement, nor is such action
contemplated within Title 14.
During the events described above, there was a Board meeting held on April 15, 2020. Among
the agenda items for this meeting was "Action Item #13," which pertains to District Code 4,
Personnel. Title 4, chapter 4.07 outlines the provisions for employee benefits such as
retirement, medical leave and insurance. During the March 18, 2020 Board meeting Resolution
2020-09 was adopted. The April 15, 2020 meeting was to further clarify District Code 4,
Chapter 4.07.050, Post -Retirement Health Benefits under Resolution 2020-10 to fall in line with
the amounts bargained in December 2019. This was quickly removed from the agenda by Mr.
Holley and no action was taken.
It is the Union's understanding that any increases to the retiree medical caps negotiated over
the years have always been afforded to current retirees, as Title 19, (19.2) (1) 2 allows.
However, seeking a middle ground, on or about April 16, 2020, the Union proposed that the
District pay the increase to all current retirees for the term of the current MOU, 2019-2024, but
that starting January 1, 2025, increases would go solely to members who retired on or after
that date. In the Union's estimation, this is both an equitable and reasonable solution. Not
only does it uphold the parties' mutual intent at the bargaining table, it also resolves the
current grievance and provides the District with an end date.
Please advise whether the Union's proposal is acceptable.
Sincerely,
„t..�
MI a Venturino
Business Representative
IBEW 1245
o1�ERN900 pFf
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'6yd•IINI SR��ao� .
TO: Michael Holley GM, TDPUD IBEW Local 1245
FROM: Mike Venturino —Business Representative Local 1245 TDPUD Grievance Form
Date: 4/14/20
STATEMENT OF FACT
grievance # 01-2020
IBEW is submitting a grievance pursuant to the Memorandum of Understanding between the Truckee
Donner PUD and IBEW L.U. 1245, Titlel4 Grievance Procedure. On or about April 1, 2020, TDPUD failed
to make appropriate retiree medical payments in accordance with the MOU.
SECTION OF MOU VIOLATED
TITLE 19 EMPLOYEE BENEFIT PROGRAM, and all other applicable Titles, Policies and/or Procedures
(1) Post -Retirement Medical and Dental Benefits:
REQUESTED REMEDY OF GRIEVANCE
The Union requests that the District cease practice of violating the MOU and make the retirees whole for
all losses.
IBEW 1245 Representative:
(1) Post Retirement Medical and Dental Benefits:
(1) To be eligible to receive post -retirement health benefits, an employee must have
at least ten (10) years of service with the District. Years of service is defined as
cumulative years of service with the District, which may or may not be consecutive
years. Employees, who retire from the District and meet the service requirement
stated above, will receive a District contribution towards their post -retirement
health benefits premium with the insurance company that is contracted for retiree
benefits with the District at the time of the employee's retirement, [or to an HRA
Heath Reimbursement Account as indicated below] as follows:
Percent of Premium Paid
Years of Service by District
10
50%
11
55%
12
60%
13
65%
14
70%
15
75%
16
80%
17
85%
18
90%
19
95%
20
100%
The post -retirement plan is the same as the active employees' medical plan
except for a $500 deductible per person compared to a $400 deductible per
person for employees. Retirees may choose the High Deductible Health Plan
as a lower cost alternative to the PPO plan.
For example, a person retiring at age 55 with 19 years of service would have 95%
of the retiree and dependent caps paid by the District.
(2) The benefit paid by the District is capped as listed below:
Monthly Caps
Individual only
$ 600
Spouse only
$ 600
Child(ren) only
$ 600
Spouse & child(ren) only
$ 1,000
Medicare Rate
$ 500
If the premiums increase above the monthly cap, the retiree will pay the difference
between the new premium and their percent of benefit established upon retirement
multiplied by the cap. Example: A person retiring at age 55 with 19 years of service
would have 95% of the retiree and dependent caps paid by the District. If initially
the premium for individual only was $340, the retiree would pay 340 — (95% x $340)
_ $17.00 If the premium increases to $500 while the cap is $475, the retiree would
pay 500 — (95% x $475) _ $48.75.
(3) Retiree cannot leave the plan and then come back. Once time is broken on the
plan, the employee or retiree cannot come back on the medical plan.
(4) If the retiree is paying for part of the medical coverage it will be done through an
electronic fund transfer from the retiree's account on a monthly basis.
(5) When the retiree is eligible for Medicare, it is mandatory that the retiree enroll for
Medicare Part B coverage.
(6) Should the District change the insurance plans or coverage through the collective
bargaining process, those will apply to retirees also.
(7) The vision benefit will remain the same without any monthly caps.
SIDE LETTER AGREEMENT
This Side Letter Agreement is entered into between Truckee Donner Public Utility District
("TDPUD") and IBEW Local 1245.
WHEREAS a dispute has arisen as to whether the parties intended in their Tentative Agreement
dated December 13, 2020 regarding an increase in the Retiree Medical Benefit Cap Payments to
extend the increase in the Retiree Medical Benefit Cap Payments to those persons retired prior
to January 1, 2020;
WHEREAS the successor Memorandum of Understanding ("MOU") has not yet been adopted
by the TDPUD Board of Directors;
WHEREAS the parties seek to resolve this dispute without further meet and confer and by
allowing the Board of Directors to adopt the proposed Memorandum of Understanding,
notwithstanding the present dispute regarding interpretation of the terms of the December 13,
2020 Tentative Agreement, and without either party waiving their respective positions relating
to the above dispute.
NOW THEREFORE, the parties agree as follows:
1. If the Board of Directors adopts the proposed MOU, there shall be no adverse inference
regarding the Board's action.
2. The parties agree to submit the dispute regarding the intent of the Tentative Agreement
regarding the increase in the Retiree Medical Benefit Cap Payments for resolution under
Title 14, Grievance Procedure, of the Memorandum of Understanding.
3. By entering into this Agreement, neither party waives any procedural or substantive
arguments it may have regarding the prosecution or defense of this disagreement.
Dated: /3 " 3 —
t
For toeDonner Public Utility is yict
Dated: "0/3/2-69
By:._
4��/, /—�77 )
For IBEW 1245
Truckee Donner Public Utility District
Directors
Joseph R. Aguera
Jeff Bender
Bob Ellis
Christa Finn
Tony Laliotis
General Manager
Michael D. Holley
May 8, 2020
Mr. Michael J. Venturino
Business Representative
IBEW Local 1245
30 Orange Tree Circle
Vacaville, CA 95687
Subject: Response to Board Referral Letter Received from IBEW 1245 on May 5, 2020
Dear Mr. Venturino:
The Truckee Donner Public Utility District Board of Directors (Board) has received a letter of referral
for a grievance submitted on April 14, 2020 from IBEW 1245. The letter of referral to the Board was
received on May 5, 2020, one day prior to the regularly scheduled meeting held on May 6, 2020. Because
the letter was received after the meeting agenda had already been published, the item could not be
included on the agenda for Board consideration.
The District is willing to place the item on the agenda for the regularly scheduled meeting on May 20,
2020. This will require IBEW 1245 to provide a written waiver of the requirement for the Board's
written response within ten (10) working days of the next regularly scheduled Board meeting as
prescribed in MOU Title 14, section 14.4, Step 3.
If IBEW 1245 chooses not to provide the written waiver, then the item shall not be placed on the agenda
for consideration within the ten (10) day requirement and the union may move to Step 4 of the grievance
procedures, referral to Advisory Arbitration.
If IBEW 1245 chooses to provide the written waiver for the Board to review the item in open session,
the written waiver and any additional supporting materials intended to be included in the Board packet
for consideration must be received by the District no later than 5:OOpm on Wednesday, May 13cn
Respectfully,
Brian Wright
Water Utility Director (Acting General Manager)
cc: Sharma Kuhlemier, District Clerk
11570 Donner Pass Road, Truckee, CA 96161 — Phone 530-587-3896 — www.tdpud.org
May 12, 2020
Mr. Brian Wright, Acting General Manager
Truckee Donner PUD
11570 Donner Pass Road
Truckee, CA 96161
Subject: Waiver, 10-Day Written Response Requirement, TDPUD Board of Directors, MOU
Title 14, (14.4) Step 3
Dear Mr. Wright,
The Union hereby agrees to waive the 10-day written response requirement, set forth in Title
14, (14.4) Step 3 of the MOU, as requested in the District's letter received May 8, 2020, on the
condition that the Union's Letter of Referral and Grievance will be placed on the agenda and
considered by the Board in open session at its next regularly scheduled meeting of May 20,
2020. Furthermore, this agreement (and the Union's waiver) shall establish no precedent.
Respectfully,
Mike Venturino
Business Representative
IBEW 1245