This guest post was authored by J. Scott Tiedemann

Today, the State Assembly Committee on Public Employees, Retirement and Social Security passed S.B. 931 (Vargas).  The bill, which was passed by the State Senate on May 16, 2011, is now headed to the Assembly Floor for second and third readings and a vote.

S.B. 931 would amend the Meyers-Milias-Brown Act, the Ralph C. Dills Act, the Educational Employment Relations Act, and the Higher Education Employer-Employee Relations Act to include identical language making it unlawful for a public employer to “use public funds to pay outside consultants or legal advisors for the purpose of counseling the public employer about ways to minimize or deter the exercise of rights guaranteed under this chapter.”  This prohibition “would not apply to payments for representation of a public sector employer before any court, administrative agency, or tribunal of arbitration, or for payments for engaging in collective bargaining on behalf of the employer with respect to wages, hours, or other terms and conditions of employment.”

Many groups, including but not limited to the League of California Cities, the California State Association of Counties (CSAC), the California School Boards Association (CSBA), and the Association of California School Administrators (ACSA), are vigorously opposing the legislation on a variety of grounds.

State law already expressly prohibits public employers from interfering with, intimidating, restraining, coercing or discriminating against public employees who exercise their collective bargaining rights.  Therefore, it is unclear what additional limitations are intended to be placed on employers by S.B. 931.

However, regardless of what is intended, the express language of S.B. 931 may result in significant negative consequences for public employers in the conduct of labor relations.  For instance, if a union were threatening to strike, an employer might consider hiring an outside attorney to seek injunctive relief from the Public Employment Relations Board.  Although the new law carves out an exception allowing an attorney to appear before an administrative agency, like PERB, an employer would typically seek legal advice prior to instituting any proceedings.  Yet, S.B. 931 would appear to limit the employer’s ability to hire outside counsel to advise it about how to proceed.  If an outside attorney advised an employer about how and whether to seek injunctive relief, the attorney would arguably be providing advice about how to “minimize or deter” the union’s exercise of its right to strike.

Or, more mundanely, if an employer had negotiated a zipper clause in a memorandum of understanding (MOU) with a bargaining unit excusing the employer from further meeting and conferring over certain subjects already covered by the MOU, and the union demanded to bargain over items arguably covered by the zipper clause, the employer may be prohibited from asking an outside attorney for legal advice regarding whether the zipper clause applied.  If an attorney advised the employer that it could lawfully refuse the union’s request to bargain because the zipper clause was enforceable, the public employer could arguably have violated S.B. 931 by obtaining legal advice about how to minimize a union’s right to meet and confer.

It is also difficult to foresee how S.B. 931 could be enforced without violating the rights of a public employer.  In order to prove that an employer used public funds to pay an outside attorney/consultant to counsel it to “minimize” the rights of a union, two well established privacy rights for public employers would be threatened.  First, the confidentiality of closed session discussions that is protected by the Brown Act and the deliberative process privilege may need to be breached.  Second, the attorney-client privilege would likely need to be breached.  Indeed, it is possible that S.B. 931 could be used as a sword by employees to discover labor relations strategy and information that would otherwise be absolutely shielded from disclosure.

Another significant concern is that some employers do not have in-house legal counsel and S.B. 931 would effectively preclude those employers from seeking legal counsel about many labor relations issues.

The League of Cities, CSAC, CSBA, and the ACSA, among others, are encouraging members to write to the members of the assembly in opposition to S.B. 931.  For more information regarding opposition to the legislation, you may refer to their respective websites.