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Title: Marion County and Marion County Law Enforcement Association
Date: November 29, 1995
Arbitrator: Leslie Sorensen-Jolink
Citation: 1995 NAC 102

In the Matter of the Interest Arbitration Between the Marion County Law Enforcement Association and the Board of Commissioners and Sheriff of Marion County. IA-10-95.

Introduction

This matter concerns the formation of a collective bargaining agreement between the Marion County Law Enforcement Association (the Association) and the Board of Commissioners and the Sheriff of Marion County, Oregon (the County). The terms of the existing agreement between those parties having ended on June 30, 1995, and the procedures set forth in ORS 243.712 and 243.722 not having culminated in a signed successor to that agreement, binding interest arbitration was initiated for this bargaining unit with employees referred to in ORS 243.736(1).

Pursuant to the procedures sets forth in ORS 243.746, the parties selected Leslie Sorensen-Jolink to serve as Arbitrator in this interest arbitration.

Not less than 14 calendar days prior to the date established for the hearing, each party duly submitted to the other party and to the Arbitrator a written last best offer package on all unresolved mandatory subjects.

The arbitration hearing was held, as originally scheduled, on September 22, 1995, in Salem, Oregon. Roy Flint, the County's Labor Relations Manager, represented the County, and John Hoag, of the Associations's attorneys, represented the Association.

At the start of the hearing, the parties stipulated that:

a. This proceeding is governed by ORS 243.742 and 243.746, as amended by /the 1995 Oregon Legislature through SB 750/Chapter 286, žl Or Laws of 1995/, and by OAR 115-40-015, as amended by temporary rules of the Oregon Employment Relations Board (ERB) effective August 1, 1995.

b. The parties have filed any no challenge alleging bias by the Arbitrator and they believe that she is unbiased.

c. This matter is properly before the Arbitrator for decision on the Last Best Offer packages submitted by the parties, as amended. There are no procedural challenges.

Neither party arranged to have a court reporter report the hearing. As the Arbitrator was making a tape-recording of the hearing, the parties agreed that the resulting recording, however flawed it might be, would constitute the official record of the proceeding.

During the hearing, each party was given full and complete opportunity to examine and cross-examine all witnesses and to present any evidence pertinent to the dispute. All witnesses were duly sworn. The County called, as its witnesses, Gary Heer, James Murchison, Ken Roudybush, Theresa Josey, Diane Phillips, Al Allen, Larry Allen and Ted Nelson. The Association called Elizabeth Caruthers, Tom Dourgarian, Chuck DeSeranno, and Raul De La Torre as its witnesses. Admitted to the record were Exs. J-1 through J-5, offered by the parties jointly; Exs. R-1 through R-12, offered by the County; and Exs. A-1 through A-24, offered by the Association.

At the end of the hearing, the parties agreed that they would submit argument simultaneously through post-hearing briefs and stipulated that the hearing would be deemed closed when the Arbitrator received the last such brief. The parties also agreed to extend the thirty-day period for the promulgation of this Decision.

Statement of the Stipulated Last Best Offers of the Parties

At the start of the hearing, the parties informed the Arbitrator that they had resolved the issue of the County's proposal concerning wages of people appointed or reinstated and that the other issues referred to in each LBO package submitted to the Arbitrator remained unresolved. Each party stipulated that the following, accordingly, was its last best offer package to the other on all unresolved mandatory subjects.

The Association

1. Article 14, Section 2 to read:

"Effective July 1, 1995, a 4% wage increase shall be applied for all classifications and steps."

2. Article 14, Section 3 to read:

"Effective July 1, 1996, the wages and benefits for all classifications and steps shall be increased by an amount not less than the increase in the consumer price index, US CPI-W, between May 1995 and May 1996 with a minimum of 3% and a maximum of 6% plus an increase of 1% in addition to the CPI increase. However the total increase shall not exceed 6%."

The Association proposes as clean-up language the deletion of the rest of the language of Section 3 of Article 14.

3. Article 15, new Section 6 to read:

"Section 6, Bilingual Premium. Any employee who is bilingual in Spanish or any other language utilized in the course of dealing with the public, including inmates, to the extent that the employee can effectively communicate in that language, will receive 2 1/2% premium of the employee's base wage." (Ex. J-5)

The County

Article 14:

"1st year:

"Effective July 1, 1995, the parties agree that the total increase in wage and benefit costs is equal to 2.9% Total Personnel Costs (TPC) for the fiscal year. The 2.9% is composed of a gross lump sum of $749.00 (based on average salary) and the respective merit (step) increases, insurance premiums and other related payroll costs.

"2nd year:

"Effective July 1, 1996, the parties agree to a wage and benefit adjustment as follows: minimum of 2% (TPC) and a maximum of 5% (TPC); the Portland CPI(W) shall establish the employer's TPC from which shall be deducted the respective merit (step) increases, insurance premiums and other related payroll costs. The remaining monies shall establish the cost of living adjustment (COLA) for that fiscal year.

"EXAMPLE: CPI = 3.0% = TPC 3.0%

payroll costs -1.0%

COLA 2.0%

Findings of Fact

Background

1. With about 1000 employees, the County serves a population of approximately 228,000 citizens. The County Sheriff is in charge of both law enforcement and corrections in the County.

2. The Association represents a bargaining unit (the Bargaining Unit) consisting of all employees of the County Sheriff's Department (including but not limited to Deputy Sheriffs, Corrections Officers, and Police Clerks) except for certain employees specified in the Agreement (and not relevant herein). The Bargaining Unit is one of four collective bargaining units comprised of County employees.

3. In 1977, the ERB certified the Oregon State Employees Association (OSEA) as the exclusive representative for all employees of the County Sheriff's Department excluding certain classifications. Sometime before August of 1981, OSEA changed its name to Oregon Public Employees Union (OPEU). OPEU entered into a series of collective bargaining agreement with the County during a 14-year period. The last collective bargaining agreement between the County and OPEU covered the period from July 1, 1989 through June 30, 1991.

In April of 1991, the Association filed a representation petition with the ERB seeking certification as the exclusive representative of the bargaining unit represented by OPEU. On June 4, 1991, OPEU disclaimed its representation interests. On June 5, 1991, the County agreed to voluntarily recognize the Association as the exclusive bargaining representative for the Bargaining Unit.

After certification of the Association, bargaining commenced in July and August of 1991. Those negotiations were heated and controversial and culminated, when the parties were unable to reach agreement on a contract, in interest arbitration before Gary L. Axon which resulted in an Award in August 6, 1992.

The resulting 1991-93 contract was the initial agreement between the parties. It was to expire on June 30, 1993.

The 1993-95 Agreement between the Association and the Board of County Commissioners and the Marion County Sheriff was executed on April 20, 1994, pursuant to a settlement after interest arbitration had commenced. Its term was to be from July 1, 1993 through June 30, 1995. At some point before that expiration date, one or both parties duly notified the other that it wished to modify the 1993-95 Agreement, and negotiations began for a new collective bargaining agreement (the New Agreement). Pursuant to its Article 47, the 1993-95 Agreement remained in full force and effect during the period of those negotiations.

4. The 1993-95 Agreement continued in force and effect, as the parties' existing collective bargaining agreement, as of the date of the instant hearing.

5. The parties have agreed that the term of the New Agreement will be from July 1, 1995 through June 30, 1997.

Relevant Legislative History of SB 750

6. In 1995, through its passage of SB 750, the Oregon Legislature made the first major revision to the Public Employe Collective Bargaining Act (ORS 243.650 to 243.782) in the 22 years since it became law.

7. The portions of SB 750 which are significant herein amended ORS 243.746, setting forth the criteria on which interest arbitrators are to base their decisions. There were significant differences between the interest arbitration criteria which appeared in the original SB 750 and those criteria in the version of SB 750 which became law.

In the original SB 750, the interest arbitrator was to give first priority to the

"...interest and welfare of the public as determined by the governing body of the public employer and the financial ability of the unit of government to meet those costs, without requiring the reduction of programs or staff and giving due consideration and weight to the other services provided by, and the other priorities of the unit of governments. Unexpended cash balance or cash carry-forward or reserves resulting from under expenditure of budgeted funds or operating efficiencies in one fiscal year shall not be considered as available financial resources for expenditure in any subsequent fiscal year." (Ex. A-8-3)

That language was unchanged as SB 750 passed the Senate and the House. After closed meetings between legislators and the Governor's office, that language was significantly changed to what became law. The first priority upon which an arbitrator's decision was to be based was "the interest and welfare of the public" (Ex. A-11).

8. Included in the remarks of Senator Neil Bryant, one of SB 750's drafters and sponsors, during the floor debate concerning the Conference Committee Report on SB 750, were the following comments on the purpose of SB 750.

"We drafted SB 750 because the public interest has been left out of the process and employers have lost the ability to manage many times in the public entities" (Ex. R-4-2).

"...the purpose of the bill initially, and it still remains, is to rebalance the system that has fallen out of balance in favor of labor .... the intent of this legislation is to restore management rights in the collective bargaining system and to respond to Oregon taxpayer demands for accountability and efficiency from the government" (Ex. R-4-3).

9. In discussing, during his floor speech, what the primary criterion "interest and welfare of the public" means, Senator Bryant said:

"... the intent is not that the arbitrator just concentrate on the particular issue or issues that are before him in the arbitration when he's considering the best interest and the interest and welfare of the public ... The arbitrator in determining what's in the best interest and welfare of the public in Salem or Gresham needs to then consider everything that is involved... in the city commission making decisions regarding the interest and welfare of the public and not just the myopic view of what's before the arbitrator on that day and that particular issue, because it does have ramifications to everything else that the city might do." (Ex. R-4-13/14)

The above-quoted remarks comprise the only legislative history available which is helpful herein.

10. Based on the representations of Mr. Hoag, the testimony of Elizabeth Caruthers, who followed SB 750 for the Oregon Council of Police Associations, and the other evidence on point presented by the parties, the June 2, 1995 floor speeches on the Conference Committee report concerning SB 750, which occurred just before the final passage of that hill, comprise the only legislative history in which the new interest arbitration criteria are discussed. The Conference Committee deliberations which led to the amendments proposed in that report took place behind closed doors in the Governor's Office.

The Interest and Welfare of the Public

11. The overall accountability for County operations falls upon the Board of Commissioners, its governing body. The basic responsibility of the Commissioners comprising the Board is to meet the interest and welfare of the people of the County, which they do basically through the services which the County provides.

One ingredient in the County being able to provide those services is an appropriate number of people in its work force. In fact, the County has told its employees that it considers them its most valuable resource. The demand for County services has increased over the last several years as the County population has grown, and each County department has experienced a dramatic increase in its workload. The County's current population growth rate is about 3% per year.

12. With the increasing demand for services, all County employees are working harder and differently. Commissioner Gary Heer thinks County employees "do a great job" (testimony of Heer).

13. The key ingredient in the County being able to provide its services is financial resources. If Comm. Heer had more financial resources, there would be more County employees.

14. During the County budget process for FY 95-96 (which started July 1, 1995), the Board established budgetary priorities in response to the County's growing need for services. The Board instructed the County Budget Officer to emphasize, if at all possible, increased services and increased personnel numbers rather than putting everything into the cost of living adjustments to employee salaries. The Budget Committee to which that instruction went agreed to it.

15. Based on that instruction, the Board expected the Budget officer to make a budget recommendation that had an increase in service levels and personnel, as much as possible. Comm. Heer believes that instructions to be consistent with what the Board has established to be the interest and welfare of the County public in having the County meet more of its needs.

16. County Administrator Ken Roudybush is the County Budget Officer. In that capacity, Mr. Roudybush received the direction from the Commissioners to attempt to develop an improved staffing pattern, to improve or, he would suggest, maintain service.

The General Fund budget Mr. Roudybush prepared and presented to the Budget Committee for FY 95-96 reflected, and was based upon, the priorities for the interest and welfare of the County's citizenry which the Commissioners had given him. It represented a significant service level improvement over the preceding year, with the recommendation that a total of 28.5 General Fund positions (including seven to the Sheriff's Office, two to the D.A.'s office, and about three to the Juvenile Department) be added and $712,000 be allocated to those new positions, it did not provide for salary increases, either directly or through a pot of gold in the contingency or some other line item to cover the cost of a salary increase settlement made during the year.

During the process following Mr. Roudybush's presentation, they found that state transfer revenues were less than had been anticipated, so they ended up having only 21.77 new positions.

17. Because there is no money set aside for salary increases any special place in this budget, the cost of any salary increase will have to come out of the operating funds of the departments. Budget Officer Roudybush's best guess is that one of the ways a department will get money for any such increase will be by filling positions later which have been appropriated to it through the budget process.

18. Compared to the other five large counties in Oregon, the County is second only to Multnomah County, and ahead of Lane, Clackamas and Washington Counties, in reported crimes for 1995.

At the same time, the County is last among the five counties in the number of deputies. (That statistic does not count all County corrections officers, even though it counts all Lane County deputies and corrections officers, as they are all part of the one classification of Deputy Sheriff.) Deputies are working hard, hopping from call to call all the time.

19. Because of the County's relatively high reported crime rate, its continuing population growth, and its relatively low number of deputies sheriffs, the Sheriff's Office, in the budgeting process for FY 95-96, requested twelve new deputy sheriff (Trainee Basic) positions.

20. Three of those requested deputy sheriff positions were approved. They received funding which allows them to be filled as of about January 1, 1996. As of the day of the instant hearing, the Sheriff's office was recruiting for those positions. The eligibility list for deputy sheriff having been exhausted with recent hirings, a new eligibility list for that classification was being created. The lengthy process of filling a deputy vacancy takes about 2-3 months, due to intricacies such as an in depth background check beyond what is done by Personnel.

21. If the funding for the three new deputy positions was no longer available, Undersheriff Allen does not believe that the Sheriff's Office would be able to fill those positions with its current operational budget. If the Department could not fill those positions, it would continue to operate as best as it could, but that would not enhance the Department's effort to provide better police service to the public.

22. The Association's LBO proposes a 4% COLA in FY 1995-96 and Total Personnel Costs (a TPC) of 3%-6% (minimum-maximum) in FY 1996-97. The County's LBO proposes a 2.9% lump sum payment in FY 1995-96 and a TPC of 2%-5% (minimum-maximum) in FY 1996-97.

Over the course of the two-year contract, the cost of the Association's offer would exceed that of the County by at least $616,602 and at most $626,740.

23. Based on the position in which the Sheriff's Office finds itself, Budget Officer Roudybush's guess is that if there was a 4% COLA for FY 95-96, the new Sheriff's Office positions that were authorized probably would not be filled. (The operating funds from which the cost of that COLA would have to be paid are not of an amount that they could absorb the cost of that COLA without additional funding.) Mr. Roudybush does not believe that end result to be consistent with the budget priorities established by the Commissioners.

Mr. Roudybush would hope that if the Arbitrator awarded the Association's economic proposal, attrition during the year would give the County enough latitude to not have to lay off employees. There is no assurance, however, that that would be the case. The Commissioners do have some options as to how they deal with unexpected expenditures, and it is their discretion to exercise those options during the year, with some help from the Budget Committee.

24. The County made a 2.9% lump sum proposal for FY 1995-96 to all the bargaining units in the County, in order to save enough money to fund the new positions. A lump sum payment would not have a carryover that would affect the next year (FY 1996-9V), in which the new positions will cost the County something over $900,000. The County wanted to avoid a big carryover cost in the second year so it could get the new positions on line full-time. It is a Commissioner-given goal to maintain stable levels of employment and achieve some continuity of programs, to maximize efficient use of resources and give the public a clear picture of what the programs are. Mr. Roudybush put the budget FY 1995-96 together, accordingly, with the intent of maintaining enough revenue to carry the same number of positions next year. The citizens of the County have a right to, and do, expect that the County will continue to fund programs that exist.

25. Although the Board of Commissioners can use its line item budget authority to veto, apparently, expenditure decisions by the Sheriff, it has not done that with the current sheriff. It did use that tool with one sheriff whom it felt was significantly out of line with the priorities of the County. Overall, Budget officer Roudybush considers the expenditures of the Sheriff's Office to be reasonable and consistent with the interests of the County.

Court Security

26. The court system in the County comprises twelve judges in the Circuit and District courts. The membership of the Court Security Committee (CSC) that is actively involved in the security issues in all County court facilities represents the interest of the County public that participates in the court process. Based on the recommendations of the CSC, the County has provided authorization for enhanced security of the Court facility over the last several years. Included were four positions in a new, uncertified classification called Court Security Officer, which would provide some security in courtrooms during trials and in moving inmate witnesses to and from the courtroom. Currently, the people assigned to be court transport deputies are all deputy sheriffs.

Under Oregon law, it is the County's responsibility to fund those positions. Even though it would be advantageous to have deputy sheriffs do the court security work, the Department created the new classification of lesser qualification and without certification in order to be able to hire at a lesser salary than deputy so as to be able to afford more of them. It would cost more to fill these positions with certified deputy sheriffs.

27. If the funding for these new Court Security officer positions was no longer available, the Sheriff's Office would not he able to fill those positions out of its remaining operational budget. In that case, the Sheriff's office would probably try to meet the need for those positions by bringing road deputies in off the road as needed or by using a temporary hire or reserve deputy. If these positions providing security to the courts were eliminated or reduced, that would reduce the effective service provided the public that participates in the court process and, accordingly, conflict with its interest and welfare.

28. Under Oregon statutes, judges have authority to issue orders to the County Sheriff.

The Reasonable Financial Ability of the Unit of Government to Meet the Costs of the Proposed Contract, 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.

29. The County developed the concept of Total Personnel Costs (TPC, a wage and benefit model) as a tool to define and place a total cap on the County's real annual personnel costs, while recognizing the Association's need to obtain a reasonable wage and benefit package for the Bargaining Unit. The total economic impact of a wage and benefit package or the real cost of a contract settlement often exceeds the negotiated cost of living adjustment and insurance increases and includes hidden payroll and rollup costs. The three goals of the TPC model are to control costs, maintain flexibility and improve trust and mutual respect between parties negotiating a collective bargaining agreement.

30. Two years ago, when the 1993-95 Agreement was being negotiated, the County introduced the TPC concept. The County came to the table with an offer concerning wages and benefits which it then called the "total annualized cost increase formula" (Ex. A-2). Rather than defining a fixed benefit level or COLA for the term of the contract, the County's offer would have limited the increase in the County's total annualized cost for all wages, benefits and "related payroll costs," in each of two fiscal years of the contract, to 6% over the previous year's total personnel costs. There was more to the offer than that, according to the two people who were consecutive Association Presidents during the formation of the 1993-95 Agreement. They assert that during negotiations for that Agreement, the County, through its representatives including Nicholas Francis, the county's chief labor negotiator, "advocated that if the Association would buy into a 6% total personnel cost roll-up,...Marion County would promise for the conceivable future to allocate 6% each year towards increasing personnel costs" (Exs. A-4-1 and A-5-1).

The advantage to the County of this asserted proposal would have been that the County would have been able to project its total personnel costs year after year, thus making its budget process less of an unknown when it came to total dollars. The advantage to the Association would have been that its member would receive a guaranteed wage increase every year.

Because of the various answers given by Mr Francis in response to the Association's questions or concerns, the Association's lack of trust when dealing with the County, and the Association's fear that the County's proposal would produce very small wage increases, the Association did not accept the County's unique proposal. The issues was carried on to interest arbitration.

After a couple of days of interest arbitration hearing, the County's 6% cap formula was re-written so it was acceptable to the Association and was used as a basis for settling the Agreement. Specifically, the parties agreed to a 4.68% wage increase effective July 1, 1993; to an increase in wages and benefits for all classifications and steps, effective July 1, 1994, by an amount not to exceed 106% of the personnel costs of the Bargaining Unit for FY 1993-94; and to a guarantee that wages would increase at least 3% effective July 1, 1994. The parties agreed that after the County notified the Association of the discretionary dollars available for the July 1, 1994 raise, the Association would notify the County that it wanted to use some of those dollars to increase other benefits, and if the County did not agree with the Association's Proposed use of the discretionary dollars, negotiations would reopen on that issue.

31. All the County, labor contracts for the 1992-95 period included a cap of a 6% increase in TPC, rather than defining a fixed benefit level or COLA for the term of the contract.

32. When it was time to calculate the exact wage increase for the second year (FY 1994-95) of the 1993-95 Agreement, the County sent the Association a letter stating that monies were available for a 5.39% increase for FY 94-95, and asking the Association to take a COLA of 3.08%, an additional week of compensation credits (an increase from one to two weeks of vacation to be taken as leave with pay or, at the employee's option, as pay, equalling 1.92%), and a single lump sum payment of .39%. On July 6, 1994, the parties agreed that effective July 1, 1994, all classifications would receive a 3.47% wage increase and each employee would receive one additional week of compensation credits. The Association, that is, compiled with some of the County's requests and took part of its increase in the form of one additional week of compensation credits.

33. About one year before the instant hearing, the Sheriff's Department tried to gain passage of a special levy to create a permanent taxing district, but it was defeated.

The County has had no serial levies in at least the last nine years. The law allows the County to put on the ballot a serial levy dedicated to law enforcement.

34. The Association contends in its proposals for the New Agreement, the County has reneged on its above-cited commitment to allocate 6% each year to increasing personnel costs, and that that shows at least an indicium of bad faith on the County's part. The Association contends that if it had known that the County was not going to do that after the 1993-95 contract, it would not have agreed to that feature in the 1993-95 Agreement. The Association contends that the County has negotiated in bad faith over this.

35. The County maintains that it was never its intent to commit to the 6% cap in contracts after the 1993-95 Agreement. Commissioner Heer asserts that he did not, as a Commissioner or as a member of the County Labor Policy Committee which established parameters for collective bargaining, authorize any commitment by the County to offer the Association any TPC percentage beyond the 1993-95 Agreement: the percentage of the TPC was to be subject to negotiation for each such contract.

Undersheriff Al Allen, who was present as a member of the county bargaining team during the presentation of the TPC Concept to the Association by County Human Resources Director Randy Curtis, does not recall at all that the County agreed to a 6% TPC for more than the life of the 1993-95 Agreement.

Although he was not at the table for negotiations of the 1993-95 Agreement, Budget Officer Roudybush cannot imagine either party wanting to enter into an agreement for a 6% cap, as assessed values could increase at less or more than 6%. He contended that even if those values did increase 15%, county income would grow by only 6%. Mr. Roudybush indicated that the County would not have committed to the use of a formula for such a long period of time, as the County would not have had any way of knowing whether it could pay for it over that period.

No promise or commitment to a 6% cap is contained or reflected anywhere in the 1993-95 Agreement.

36. Although the County is now purchasing health care, it used to be self-insured on health care. The County did "OK" vis- a-vis the marketplace when it was self-insured; it limited the increases (testimony of Heer). The County now has a three-year contract with the health care company. The County always has the option of going back to being self-insured. When an employer is self-insured, it has some control on how it actuarially internally sets its rates.

37. According to the County's Chief Accountant, the Association's LBO (as stated in Mr. Hoag's September 7, 1995 submission to the Arbitrator) would cost the County $172,762 more ($434,535) in FY 1995-96 than would the County's LBO ($261,773).

The County acknowledges that it is not an issue of inability to pay for a cost of living adjustment in FY 95-96; it is an issue of prioritizing resources so that the County will be able to provide other services over the long term.

38. As noted above, the County made the same first-year (FY 1995-96) offer of a 2.9% lump sum to all the bargaining units in the County. The general bargaining unit, of which more than half the county employees are members, has accepted the 2.9% lump sum offer. The Federation of Oregon Parole and Probation officers (FOPPO) has tentatively agreed to that offer and recommended approval to members, who were in the process of voting at the time of the hearing. The Oregon Nurses Association was still bargaining with the County at the time of the hearing. Unlike the Bargaining Unit, those bargaining units have the right to strike.

The County asserts that it made this first-year lump sum offer to all bargaining units because it had to find a way of saving enough money to fund the new approved positions. Unlike a cost of living increase, a lump sum payment would not have a fiscal impact carrying over into the second year of the New Agreement, when the new positions would cost the County something over $900,000.(1)

The Association's LBO would create additional costs in FY 1996-97 due to the rollup costs of $337,916. A 3% TPC in FY 1996-97 would cost the County $635,415 ($297,499 + $337,916) and a 6% TPC would cost $932,915 ($594,999 + $337,916). Accordingly, the Association's LBO for FY 1996-97 would cost the County's between $443,840 and $453,978 more than the County's LBO for that year.

A Reasonable Operating reserve Against Future Contingencies Shall Not Be Considered as Available Toward a Settlement

39. As noted above, the County asserts that unlike past years, the County has no pots of gold, in a contingency fund, other line item, or elsewhere, from which it could cover the salary increases the Association proposes.

The General Fund cash carryover that the County has from one year to the next is set out in the yellow, Resources section of the Annual Budget, as Net Working Capital. $3,434,670 was approved and adopted (thereas) to be a part of the expended budget for FY 1995-96. That figure was the part of the cash carryover (from FY 1994-95) that they knew, when they put the budget together, that they would have available. That figure never matches exactly the figure resulting from the final analysis, after receipts and expenditures have come in. The actual cash carryover from FY 1994-95 looks like it will be in the neighborhood of $5,500,000 (in a budget with General Fund revenue and requirements each totalling $45,325,633), or $2.1 million more than the carryover budgeted.

In the General Fund, actuals could exceed projections in a given year (a + variation between projected and actual revenues and/or a - variation between projected and actual expenditures) by $2-3 million at the outside, probably. Such a fluctuation turns into carryover.

Budget Officer Roudybush testified that it took a $3.4 million carryover balance to balance the FY 1995-96 budget, to maintain staffing. Accordingly, Mr. Roudybush contends, he must come up with another $3.5 million carryover, at least, to balance the FY 1996-97 budget. That means, he submits, that in addition to the $2.1 million extra carried over into FY 1995-96, he must find an underestimate of revenue, or an underexpenditure, in FY 1995-96, of at least $1.4 million, in order to maintain staffing in FY 1996-97. The positive fluctuations in the carryover balance could he a key to maintaining County staffing and programs: in order to do that, there must be a fairly substantial carryover balance.

Budget officer Roudybush considers the above-described manner in which the County is dealing with the fluctuations in carryover balance to be consistent with the statutory mandate that "a reasonable operating reserve against future contingencies, which does not include funds in contemplation of settlement of the labor dispute," not be considered as available toward a settlement (ORS 243.746[4][b)). He submits that the carryover balance continues to be essential for the maintenance of services for the County for FY 1996-97.

The Ability of the County to Attract and Retain Qualified Personnel At the Wage and Benefit Levels Provided

40. Commissioner Heer acknowledged that it is important for the County to attract qualified personnel. He considers it desirable for the County to be able to pick highly qualified people, because they give efficient service. Commissioner Heer acknowledged that if an employer does not pay its employees roughly what they could earn elsewhere, that employer might start losing its employees.

41. At Mr. Flint's request, Senior Personnel Analyst Diane Phillips compiled data which reflects the County's recruitment and retention history related to Bargaining Unit positions, for the period from July of 1993 to June of 1995.

After analyzing the number of applicants for each Bargaining unit position for which the County recruited during that two-year period, Ms. Phillips does not see any problem with, or feel any concern about, the County's ability to attract qualified personnel for those positions. Of the twenty positions for which the County recruited during that period, only three attracted less than ten applicants, and their low numbers are explained by the fact that only current County employees were allowed to apply for those positions.

During the same two-year period, the County had an attrition rate from Bargaining Unit positions of about five percent. (That figure includes all separations from employment, including through termination by action of the County and through retirement.) That is the lowest attrition rate among same-sized and larger County departments.

During that two-year period, the County tracked the reason why employees separated from County employment by asking them to indicate that reason on an exit questionnaire. One of the responses available to resigning employees on that questionnaire was "Better Salary." During the two-year period, none of the questionnaires completed indicated "Better Salary" as the reason for resignation.

The Overall Compensation Presently Received by Employees, Including Direct Wage Compensation, Vacations, Holidays and Other Paid Excused Time, Pensions, Insurance, Benefits, and All Other Direct or Indirect Monetary Benefits Received

42. Direct Wage Compensation

Currently, a County Deputy Sheriff with a Basic Board of Police Standards and Training (BPST) Certificate receives, at Step 2, a monthly salary of $2696, and, at the top step, a monthly salary of $3438.64. A County Deputy Sheriff with an intermediate BPST Certificate,(2) at the top step, receives a monthly salary of $3525, and the same Deputy Sheriff with an Advanced BPST Certificate receives a monthly salary of $3628. (Exs. R-10-1&3 and A-16-1)

In addition, a County Deputy Sheriff commencing his or her tenth year of service, who has an Advanced BPST Certificate and an A.A. Degree, also receives a longevity pay step of 2% per month. A Deputy Sheriff commencing his or her fifteenth year of service, who has an Advanced BPST Certificate and a B.A. Degree, receives another longevity pay step of 4% per month. (Exs. J-1- 30 and R-10-2/3)

Currently, County Support Staff (Police Clerks) at Step 2 receive a monthly salary of $1805.00, and, at the top step, a monthly salary of $2262.00. County Support Staff (Police Clerks) receive no certificate or longevity pay. (Ex. R-10-4&6)

In addition, any Bargaining Unit member designated to work in the capacity of a Field Training officer (FTO) receives a one-step (5%) pay increase for time spent acting as a FTO.

In addition, Bargaining Unit members receive each year, as compensation credits, an additional two normal workweeks' of vacation, to be taken as leave with pay or, at the employee's option, as compensation for two normal workweeks at the employee's regular monthly rate of pay (80 hours or 3.84% of annual salary). If the employee does not use those credits by the close of the fiscal year, s/he forfeits them. About 90% of the County employees utilize compensation credits as pay rather than vacation.

In addition, Bargaining Unit members are paid for authorized overtime work at the rate of time and one-half per hour or, at the employee's election, compensatory time off (Ex. J-1-39/40). Bargaining unit members called to work outside his or her regular work schedule are paid for a minimum of three hours at the rate of time and one half. Detectives, court services and nurses assigned to be on call are compensated at the rate of $90.00 for each regularly scheduled workweek of on-call assignment.

In addition, off-duty Bargaining Unit members required to appear before a court of law, in connection with their regular duties, receive a minimum of 2-4 hours' overtime pay at the rate of time and one-half for each court day.

43. Vacations

After six months of service, Bargaining Unit members are credited with between 8 and 16 hours of vacation leave per month, depending upon their length of continuous service.

In addition, as noted above, Bargaining Unit members may elect to receive their annual compensation credits in the form of two normal workweeks of leave with pay.

44. Holidays

Bargaining Unit members receive ten paid holidays and, after six months' service, one personal holiday each calendar year.

45. Pensions

Pursuant to a settlement between the parties after the passage of Ballot Measure 8, Bargaining Unit members now pay their PERS retirement contributions, while receiving a 6.000% pre-tax salary offset. That offset is included in the salary figures recited in Finding 42 above.

46. Insurance

Bargaining Unit members receive fully-paid medical, life, dental, and long-term disability insurance.

47. All Other Direct or Indirect Monetary Benefits Received

Among the other direct or indirect monetary benefits received by certain or all Bargaining unit members, pursuant to the Agreement, are the following.

- Corrections employees who are required to remain at a corrections facility during their meal period receive a meal from the County. That cost the County roughly $16,000 for members of the Bargaining Unit from September 1, 1994 through October 30 1995.

-All Bargaining Unit members who do not work in the downtown Salem Courthouse area receive free parking from the County.

-Employees who are required to wear a uniform receive from the County that uniform and payment for its cleaning. Plain clothes officers receive a clothing and cleaning allowance from the County. During FY 94-95, the cost of cleaning uniforms for the 77 Bargaining Unit members who were uniformed employees was approximately $10,999.45.

-Bargaining Unit employees may receive tuition aid for training from the County under certain circumstances. Tuition assistance.

Bargaining unit members also receive the following direct or indirect non-contractual monetary benefit from the County. As part of its community policing philosophy, the Sheriff's Office has adopted a high visibility program which allows the majority of its deputies to take home patrol cars, even on their non-work days. From that, those deputies derive the indirect monetary benefit of free transportation to and from work.

48. Currently, all of the Sheriff's office patrol deputies are scheduled to work 4 12-hour shifts per week. Accordingly, over the period of a year, they are scheduled to work about 102-110 more hours than if they were scheduled to work 5 8-hour shifts per week. Those employees are not monetarily compensated extra salary, directly or indirectly, for those 102 or 110 extra hours of scheduled work per year.

The lack of extra compensation for this extra work time scheduled on a 4/12 schedule resulted from the interest arbitration award on a compensation issue concerning the 1993-95 Agreement.

Pursuant to a tentative agreement, the New Agreement will specify that work schedule for patrol deputies will be 4/10 or 4/12. There is a good probability that the Sheriff's Office will change its patrol deputies to a 4/10 schedule effective January 1, 1996. One of the reasons advanced for that change is that a 4/10 schedule is more beneficial to community policing because it keeps deputies in the community more days of the week. if the Sheriff's Office changes its patrol deputies to a 4/10 schedule, it will be voluntarily giving up 102 or 110 extra scheduled hours a year which each patrol deputy be scheduled to work and for which s/he would receive no extra compensation.

49. Pursuant to the other tentative agreements that, as of the time of the hearing, already had been reached regarding other articles in the New Agreement, the following other changes from the Agreement will be made from which employees will receive a direct monetary benefit;

-Bargaining Unit members will receive a minimum of four hours overtime pay for court time, regardless of when that time occurs as long as it is an off-duty time.

-On-call pay will change from $90 per week to a formula which is a percentage of the top step basic Deputy salary.

-Bargaining Unit members called to work outside their regular work schedule will receive a minimum of four, rather than three, hours' pay.

49. The cost of living salary adjustments made for the Bargaining Unit over the last five years total 20.44%. During that period, Bargaining Unit members also received additional longevity steps in 1990, an additional week (1.92% of total salary) of compensation credits in 1994; and the cost of expansion of bargained for benefits.

Comparison of Overall Compensation with that of employees Performing Similar Services in Comparable Communities in Oregon

50. The parties each have used Washington, Lane and Clackamas Counties, in Oregon, as comparable communities, for the purpose of evaluating, comparing and proposing the terms of the New Agreement. As those three counties are in the same population range as, and are geographically proximate to, the County, and like the County have parity pay for corrections officers and deputy sheriffs, the Arbitrator adopts them as the comparator jurisdictions herein.

51. Clackamas County comparator employees received a 2.9% wage increase on July 1, 1995. Their contract is set to expire on June 30, 1996.

Lane County comparator employees received a 2.0% wage increase on July 1, 1995. Their contract is set to expire on June 30, 1996.

The collective bargaining agreement covering Washington County comparator employees expired an June 30, 1994, and a successor agreement had not been executed as of the date of the instant hearing. Accordingly, those employees have not yet received any wage increases for FY 1994-95 or FY 1995-96.

Direct Wage Compensation

52. As a County Personnel Analyst, Theresa Josey, at Mr. Flint's request, completed Ex. R-10, the County's comparison of current salaries and benefits for the positions of Deputy Sheriff and Support Staff (Police Clerk) in the Bargaining Unit and in Lane, Washington and Clackamas Counties.

The salaries Ms. Josey used for Lane and Clackamas counties include cost of living adjustments received for FY 95-96. The salaries Ms. Josey used for Washington County are pursuant to the collective bargaining agreement which expired on June 30, 1994. Accordingly, Ms. Josey's figures for Washington County do not include any salary adjustments for FY 1994-95 or FY 1995-96.

Ms. Josey did not check with the Washington County bargaining representative as to whether there was tentative agreement between Washington County and the Washington County Police Officers' Association (WCPOA) on wages. She spoke with someone who was not a negotiator and not on the county bargaining team, and he had no idea whether there was a tentative agreement on wages.

53. Ex- A-16 is the Association spreadsheet analysis comparing total compensation which a police officer receives from the County and each of the, three comparator counties, at five years of service, at 20 years of service (commonly) and at 20 years of service (all benefits available).

The undisputed September 8, 1995 letter of attorney Jaime Goldberg, of Mr. Hoag's firm, establishes that there is in fact a tentative agreement between those parties on financial issues. Pursuant to those tentative agreements, Washington County comparator employees will receive a 3.0% wage increase retroactive to July 1, 1994, a 3.5% (CPI + 1%) wage increase retroactive July 1, 1995, and increases of between 2.5% and 5.5%, plus 1%, on July 1, 1996 and July 1, 1997. The wage figures resulting therefrom are included in the Association's comparative analysis done in Ex. A-16.(3)

54. The County has seven total steps in its salary scale. The record does not reveal how many steps are in the salary schedules of each comparator county.

55. Currently, a County Deputy Sheriff with a Basic BPST Certificate receives, at the top step, a monthly salary of $3438.64. The same Deputy in Clackamas County would receive a monthly salary of $3448.53; in Lane County $3456.00; and in Washington County $3269.57 (pursuant to the tentative agreement described above). For a top step deputy sheriff, the County's monthly salary of $3438.64 is monthly salary is 1.39% more than the average salary ($3391.37) of the comparator counties.

The above figure of $3269.57 for Washington County differs from the $3432.54 used by the Association as that County's top step Deputy wage in Ex. A-16. As the County has pointed out, applying the percentage wage increases of the tentative agreement in Washington County (as per Ex. A-17) to the top step Basic monthly wage for a Washington County Deputy Sheriff under the expired contract (as per Ex. R-10-3), to calculate the July 1, 1994 and July 1, 1995 top step Basic salaries for Washington County deputies under the tentative agreement, results in a figure of $3269.57, not the $3432.54 figure shown on Ex. A-16. Crunch numbers though she has, the Arbitrator has not been able to ascertain where the Association got the $3432.54 figure. Correction of it to $3269.57 changes all other figures on the spreadsheet which are based upon top step wage. The "EE Total Income Sub-Total" figure for Washington County on Ex. A-16-1, for example, must be adjusted to $3,465.74.

56. Both the County and Lane County raised wages 6% to offset the fact that their employees now pay the 6% PERS employee retirement contribution. Washington County is still making the 6% PERS retirement pickup, pursuant to Court order obtained by WCPOA, and will continue to do that until the constitutional status of Ballot Measure 8 Has been finally determined. Clackamas County is still making that 6% PERS retirement pickup voluntarily, and is set to do so until June 30, 1997, per Ex. R-10-1.

Since the above salary figures include for the County and Lane County a 6% offset for the retirement contribution which the employee must pay, it is appropriate to subtract that offset from the County and Lane County figures. Likewise, since Clackamas and Washington Counties are continuing to pay the PERS retirement pickup for the employee, it is appropriate to add that payment to employee income.

57. Also included in the Clackamas County "ER Paid Retire Pickup" is 4% deferred compensation which employees receive.

If the monthly salary value of County compensation credits are added to monthly salary, a County Deputy Sheriff, at top step Basic, Intermediate and Advanced BPST Certificates, will receive more monthly compensation than his or her counterpart in Lane, Clackamas or Washington County (as per its financial issue tentative agreements).

58. For Support Staff (Police Clerks), County top step salary with or without compensation credits exceeds Clackamas County top step salary and lags behind Lane County top step salary. (In Washington County, clerical support staff are not members of the WCPOA.)

59. If County Deputy Sheriff wages were adjusted upward by 4%, as the Association's LBO proposes, as of July 1, 1995, would have the following effects on the relationship of those wages to the wages of like positions in the comparator counties.(4)

a. At step 2, the County wages would exceed the Lane County, but not the Washington or Clackamas County, wages. With compensation credits added, those County wages would exceed the Lane and Clackamas County, but not the Washington County, wages.

b. At top step for Basic, Intermediate, and Advanced BPST certification, the County wages, both without and without compensation credits added, would exceed the wages for Lane, Washington and Clackamas Counties.

c. At 15 years, the County wages would exceed the wages for Lane and Clackamas Counties, but not Washington County. With compensation credits added, the County wages would exceed the wages for Lane, Washington and Clackamas Counties.

If the wages of County Support Staff (Police Clerk) were increase by 4% as of July 1, 1995 (as proposed by the Association's LBO), County step 2 and top step wages for that position would exceed step 2 and top step wages for like positions in Clackamas, but not Lane, County, whether or not compensation credits were added.

60. The Arbitrator adopts as fact the figures shown in the spreadsheets sets forth in her opinion below. To the extent that any figure in an above-finding may conflict, or appear to conflict, with a figure in a spreadsheet, the latter controls.

61. Personal Holidays

County and Washington County employees receive 8, and Clackamas County employees receive 16, hours of personal holidays per year. Lane County employees receive 88 hours of personal holidays, as they receive so many hours per month of holiday time with no designated holidays: when they use their holiday time is their choice. County employees receive a total of 88 hours of personal and legal holiday time per year.

62. The goal of the County, at the direction of the Board, is to establish a "competitive" wage level for its various classifications. The Board has defined "competitive" as a salary sufficient to attract and retain qualified employees: not to be the highest or the lowest paying employer, but competitive. The County Human Resources Department has found that with most positions, a good competitive wage level for most of its classifications is within five percent above or below the wage level offered by employers competing for the same labor pool as the County. The County pays more than that for some professional positions, and it pays less than that for some classifications, but overall County practice is to strive to pay within five percent of the salary ranges of competing employers.

Not including compensation credits, the County's current Step 2 salary for Deputy Sheriff Basic BPST Certificate is 4.8% below the highest-paying comparator county (Clackamas County), i.e. within its 5% goal. If County compensation credits are added to that salary, the County is more comfortably within that 5%. The other two comparator counties are paying less than Clackamas County and so are within the County's goal.

Adding a 4% COLA to those figures would result in a salary level which would not be consistent with the methodology or practice of the County, as it would make the County the highest-paying employer among its comparators.

The CPI-All Cities Index

63. The County's LBO package offers, for the second year of the New Agreement (FY 1996-97), a wage and benefit adjustment based on a formula using, the "Portland CPI(W)" to establish the County's TPC. In its Brief, the Association represents that that index has been to the benefit of employees compared to other indexes including the U.S. All Cities.

64. ORS 243.746(4)(f) dictates that in reaching her decision herein, the Arbitrator give secondary priority to criteria which include the "CPI-All Cities Index, commonly known as the cost of living." In his comments during the Floor Debate on the Conference Committee Report concerning SR V50, Senator Bryant stated that the specific index to be used in implementing that criterion is the "All Cities Wage Earner" index (Ex. R-4-14).

The percent change to the U.S. All Cities Index for Urban Wage Earners and Clerical Workers for the year ending August, 1995 was 2.5% and for the year ending July, 1995 was 2.8%. The percent change to the U.S. All Cities Index for All Urban Consumers for the year ending August of 1995 was 2.6% and for the year ending July of 1995 was 2.8%.

The Association's Proposal for Bilingual Premium Pay

65. A good portion of the County police and corrections clients do not speak English. Approximately 40-50% of the people who come through intake for the County corrections speak only Spanish. The record reveals just two Association members who are fluent in Spanish.

66. Officers who speak fluent Spanish, whether Hispanic or not, perform a valuable service in the community due to the large number of Hispanics with whom Sheriff's Office personnel come into contact.

Corrections Officer Raul De La Torre uses his ability to speak Spanish fluently to the benefit of the County and other employers in their work in the criminal justice system throughout his entire shift on a daily basis. He translates for corrections and arresting officers. He obtains basic information from the arrestee and he translates the charges and the procedures for the arrestee and tries to overcome his/her confusion as to why s/he is there. Mr. De La Torre also reads inmates their rights in Spanish; translates for the supervisors during hearing; explains the rules to inmates in Spanish; helps the state release officer get information during release interviews to ascertain whether to release an individual or not; and reads and explains the release agreement to an individual in Spanish.

A police officer who can speak fluent Spanish is a benefit to both the County and to the citizens with whom that police officer comes into contact, because he can make the working relationship between the citizen and police officer much easier.

A great portion of the Hispanic population that comes through the criminal justice system arrives there in part because of language and cultural barrier issues. A good portion of the parties that come in are arrested under failure to appear warrants, because they have no idea that a citation, written in English only, requires them to appear in court.

The time Mr. De La Torre is called upon to translate take him away from his duties, which he then has to make up as best he can.

The County would benefit very much from encouraging officers to be fluent in Spanish. It would very much help the County in recruiting officers who speak Spanish.

67. Pursuant to the 1993-95 collective bargaining agreement between Lane County and the Lane County Peace Officers Association, any employee who is bilingual in Sign Language or Spanish is paid five percent premium pay.

68. Bilingual incentive premium is estimated to apply to no more than 10 people. Assuming an average annual salary of $36,588 with a 4% wage increase to total $38,051, the 2.5% on an annual basis for 10 people would be $9,513 for FY 1995-96. To this would be added a compensation credit increase of $366 and fringe benefit increases of $1731 for a total cost of the bilingual incentive of $11,610 for FY 1995-96. This amount is included in the FY 1995-96 cost of the Association proposal figures found above.

Summary of the Positions of the Parties

The Association

The Association's proposal for a 4% COLA in the first year and a CPI-based COLA plus 1% in the second year hinges on the Association's contention that the compensation of people in the County's Deputy Sheriff and Corrections officer classifications lags from 8% to 10% behind the average compensation of those classifications in comparable jurisdictions. The Association proposes, therefore, a catch-up of 1% (i.e. over CPI) each year.

In addition, the Association requests a bilingual premium of 2.5%.

Interest and Welfare of the Public

The Association points out that the interest and welfare of the public is supposed to be given the "first priority" by an Interest Arbitrator. The Association argues that under SB 750, as passed, County elected officials cannot determine unilaterally what employee compensation best serves the interest and welfare of the public. The Association urges moreover that the legislative history of SB 750 evidences that as in the past, whether a proposal best serves the interest and welfare of the public should be evaluated in terms of comparability and the ability of the Government to pay the costs of an award, two of the secondary statutory criteria. (The Association contends that only if employees are paid the same as other public employees in comparable jurisdictions will citizens get the benefit of competent, well-trained employees.) The Association argues, in other words, that the "interest and welfare of the public" is best served by a fair wage for County employees at a cost that is reasonable to County citizens.

The Association contends that the County's proposals are without precedent in the State of Oregon and that there can be no justification for their adoption based on this primary statutory criterion. The Association urges that assessed in terms of this primary criterion, the Association's modest proposal for a 1% increase over the US CPI-W index, and its extremely reasonable proposal for bilingual pay, make the Association's LBO superior to the County's. The Association argues that its LBO, therefore, clearly should be adopted.

Reasonable Financial Ability To Pay

The Association contends that the County is not unable, but is unwilling, to pay. The Association submits that considering the County's hidden cash carryover, there is no question but that there are reasonable amounts of fund available to pay for the Association's proposal. The Association maintains that given the County's "unanticipated" $2.1 million of cash carryover (over and above its anticipated cash carryover), the County clearly can pay the LBO of the Association and still have a reasonable operating reserve against future contingencies.

Ability to Attract and Retain

The Association acknowledges that the County presently can attract qualified personnel. It argues, however, that if wages are not increased by the Association's offer, based upon the testimony of the County's witness, there will be at least 4% increased disparity in wages between the County and the comparable employers, which will cause qualified employees either not to be attracted or to leave.

Comparative Overall Compensation

The Association argues that the fact that the County is far down on any comparability analysis is the primary reason why its LBO must be granted. The Association contends that when the comparative wage data and the PERS pickup issue is analyzed, it becomes clear that the preferred place of the County, to be within 5% of market, is something the County will not obtain unless the Association's proposal is granted. According to the Association, the wages of Bargaining Unit members lag 8-10% behind their counterparts, and the County's proposal would cause those County wages to fall up to 4% further behind those of their counterparts over the next two years. The Association contends that given those facts, its proposal for a 1% increase over the US CPI-W should be adopted.

The CPI

The Association contends the second year wage formula in the County's LBO uses the Portland CPI Index which, the Association maintains, has been expressly rejected by the Legislature in ORS 243.746(4)(f). The Association argues that that use of the Portland CPI Index would violate the statutory mandate that the CPI-All Cities Index be used as a criterion. The Association argues that for that reason alone, the County's LBO should be rejected.

The Association contends that the remaining two criteria (the stipulation of the parties and other traditional factors, if the above factors do not provide sufficient evidence for an award) are not relevant herein.

Conclusion

The Association argues that based on the interest and welfare of the public and comparability, its LBO must be adopted.

The County

In the County's view, the significant difference between its proposal and that of the Association is the cost of each, based on its wage adjustment component. The County contends that its LBO is the most reasonable and the most consistent with the new statutory criteria.

The County contends that given the statements as to the purpose of SB 750 offered by its drafters during the Senate floor debate preceding final passage of the bill, the concepts of managing, balance, accountability, efficiency and the credibility of government institutions should be of utmost importance in the application of that new law herein.

The County describes the Arbitrator's task herein as to determine which of the proposals is the most consistent with the following criteria, set forth in ORS 243.746(4).

Interest and Welfare of the Public

The County charges that because this criterion has been given first priority and therefore elevated above all other criteria, it is the most important criterion in the Arbitrator's deliberations. The County argues that because it is in business to provide services that meet the interest and welfare of its public, any impediment to that provision of such services would be inconsistent with the intent of the Legislature. The County contends that because population growth has increased the public's demand for County services and, accordingly, increased the County's workload, the public's interest and welfare requires that additional employees be added to the County workforce. The County contends that priorities its governing body established for its FY 95-96 budget were based upon that requirement, as well as the need to provide for stable funding and competitive salaries. The County asserts that in setting those priorities, the Board employed the County-wide perspective to which Senator Neil Bryant alluded in discussing what "interest and welfare of the public" means. The County asserts that it cannot achieve and sustain the staffing levels necessary to the interest and welfare of the public and pay for the Association's LBO: it must have a break from the personnel rollup costs for a single year in order to do that. The County argues that accordingly, an award of the Association's LBO would be made at the expense of the County ability's to meet the interest and welfare of the public.

Reasonable Financial Ability to Pay

The County argues that giving due consideration and weight to the other services provided by, and other priorities of, the County, as determined by its governing body, the County does not have a reasonable financial ability to meet the costs of the Association's LBO. The County specifically points to the budget priorities established by the Board to meet the County's expanding service needs. The Association submits that if the Association's LBO is awarded, the new positions created for the express purpose of meeting the defined interest and welfare of the people of the County cannot be funded. The County contends that given the necessity of the County's projected operating reserve against future contingencies to its priority of providing uninterrupted service, that reserve is reasonable and therefore not to be considered available toward a settlement herein.

Ability to Attract and Retain

The County submits that it has established that under its current compensation structure, it has no difficulty in either recruiting or retaining qualified staff. Accordingly, contends the County, this criterion provides no justification for choosing the Association's proposal over the County's proposal.

Overall Compensation

The County maintains that it provides, and has tentatively agreed to provide under the New Agreement, a "veritable plethora" of benefits to members of the Bargaining Unit. The County contends that whether the benefits it provides are contractually or policy driven, its overall compensation package is not only competitive, but outstanding. The County submits that the salary adjustments and other compensation enhancements it has made over the last five years demonstrate its commitment to remaining competitive with its compensation package.

Comparison of Overall Compensation

The County submits that it is its intent to, overall, remain within five percent of the salary ranges in comparator counties, with the express purpose of remaining competitive. The County submits that fact that it has no problem recruiting or retaining employees, and that in the past two years, no employee in the Bargaining Unit has left the employ of the County for a higher salary, appears to validate that compensation practice.

The County contends that despite the July 1, 1995 salary adjustment made, or tentatively agreed upon, in the comparator counties, current County salaries remain at least competitive and the highest of the comparator counties when the salary equivalent of compensation credits is added to the County's monthly salary figures. The County submits that compensation credits must be factored in to that equation, because about 90% of County employees take those credits as cash.

With regard to the insurance, the County urges that the Arbitrator consider not the cost of the insurance coverage to the employer, but whether the coverage is fully paid by the employer (i.e. the benefit costs the employee nothing). The County contends that if dollar values are to be used as a comparator, each insurance plan must be examined and compared relative to the actual benefits provided, out of pocket expenses, etc. The County urges that since the record does not include the information necessary for such a comparison, the only basis for comparison is that each employer provides a full-paid insurance benefit program. The County argues, moreover, that it should not be economically penalized herein because it is able to contain the costs of such a program more effectively than comparator counties,

Likewise, the County urges that the costs of vacation and holidays should not be included in the total compensation comparison, as the employee does not receive one penny of those costs in his or her salary.

The Arbitrator has considered each other challenge or qualification which the County has asserted to the figures the County has offered for the components of total compensation. Although the results of that consideration are incorporated into the figures the Arbitrator has used for those components, if any, in her opinion below, the Arbitrator declines to further detail those County challenges or qualifications herein, for purposes of brevity.

The County contends, in sum, that the Association's offer of a 4% COLA for FY 1995-96, as well as the Association's offer for FY 1996-97, is unwarranted when compared to the compensation received for like work performed in the comparator counties. The County maintains that it already provides a comprehensive and competitive overall compensation package when compared to that provided employees performing similar services in the comparator counties.

The CPI

The County contends that the Association's offer of a 4% COLA for the FY 1995-96 is unwarranted relative to the CPI-All Cities index, which for the 12-month periods preceding August and July of 1995 was between 2-5% to 2.8% (depending upon whether one views the CPI-All Cities(W) or CPI-All Cities(U)). The County submits for that reason, that the Association's offer for FY 1996-97 is also unwarranted.

Conclusion

For all these reasons, the County urges the Arbitrator to award the LBO submitted by the County, effective July 1, 1995.

OPINION

In promulgating her Findings of Fact, Opinion and Order herein, the Arbitrator has followed the statutory requirements, and the ERB rules, governing public employee interest arbitrations. In particular, in accordance with ORS 243.746(4), the Arbitrator has based her Findings of Fact, Opinion and order upon the criteria set forth in ORS 243.746(4), giving first priority to paragraph (a) and secondary priority to paragraphs (b) to (h), thereof.

Paragraph (a): The Interest and Welfare of the Public

The County's Board of Commissioners, which is its governing body, has determined that to best provide the services to meet the interest and welfare of the people of the County, the County must have more people in its work force. That determination is based upon the fact that each County department has experienced a dramatic increase in its workload, as the demand for County services has increased with population growth.

The need for more County employees resulted, and is reflected, in priorities which the Board established for the County's FY 1995-96 budget. Pursuant to those priorities, that budget emphasizes increasing service levels and personnel, as much as possible, rather than increasing salaries. For example, it includes the addition of three deputy sheriff positions to the understaffed Sheriff's Office.

Under ORS 243.746(4), as modified by SB 750 pursuant to action of the 1995 Legislative Session, can the Arbitrator review the above-described determination of the Board as to the interest and welfare of the public? The language in the original version of SB 750 indicated a negative answer to that question, as it specified that the interest and welfare of the public was to be "determined by the governing body of the public employer..." (Ex. A-8-3). The Association contends that the fact that that specification was deleted from the bill, and does not appear in the provision which became law, means that the Legislature did not intend that the governing body of the public employer unilaterally determine, for purposes of ORS 243.746(4), the interest and welfare of the public. The Arbitrator agrees. If that law allowed an employer to unilaterally determine the interest and welfare of the public, which is the criterion which an interest arbitrator is to give first priority, interest arbitration would be a meaningless process.

In order to review the Board's determination, the Arbitrator must ascertain what the 1995 Legislature intended in using the phrase "interest and welfare of the public." The language of that phrase, on its face, is ambiguous. The available legislative history explaining that phrase consists of the above-quoted remarks of Senator Neil Bryant during his June 2, 1995 floor speech. Senator Bryant indicated that his intent, as a drafter and sponsor of SB 750, was that when an interest arbitrator was determining what was in the best interest and welfare of the public, s/he not focus myopically just upon the particular issue/s before him or her in that interest arbitration, but consider everything involved in the governing body making decisions regarding the interest and welfare of the public, i.e. the ramifications upon everything else the public employer might do. The County contends that in setting a County-wide budgeting priority to add additional employees to the workforce, the County Board was doing just that: considering everything that was involved in the operation of the County.

The County maintains that in order to add and retain the necessary employees, it had to make a lump sum wage proposal to current members of its bargaining units for FY 1995-96, rather than a proposal for a wage increase. Noting that it has made the same first year offer to all four of its bargaining units, and that the largest of those units has agreed to that offer and another has tentatively approved it, the County argues that it is critical to the long-term benefit of the public that the award herein be consistent with the FY 1995-96 agreements of the other County bargaining units. Consideration of this County-wide perspective, the County asserts, is precisely the which Senator Bryant's remarks indicated the "interest and welfare of the public" criterion demands.

The Association's focus is different. In the Association's view, the interest and welfare of the public will be best served herein by payment of fair and competitive wages to the employees who serve the public, because only with such wages will the County be able to attract and retain the public employees who deliver good services to the community. As Arbitrator Richard M. Stratton has written:

"The interest and welfare of the public is best served with competent, effective, and well motivated officers operating the County detention facilities. In other words, the costs should be reasonable to the taxpayer and fair to the employee." (Ex. A-14-2: Multnomah County Correction Officers Association / Multnomah County [1988])

That means that employees should he paid wages that are in line with comparable jurisdictions if the employer can afford that.

The Association contends that wages received by Bargaining Unit members lag behind those received by like employees in comparable jurisdictions and that implementation of the County's offer would guarantee that wages received by County employees would fall further, behind wages received by their counpterparts for the next two years. The Association asserts the latter result would increase employee dissatisfaction and turnover, which is not in the interest and welfare of the public. As Arbitrator Stanley H. Michelstetter II has written:

"The public has a strong interest in the stability and continuity of public employment for those employees who faithfully and diligently perform their duties over the years. Continuity not only improves services in general, but provides the necessary stability and continuity for the specific services which this unit provides....

". . .

"The public interest in professional positions particularly is in hiring good employees and encouraging them to remain with the public employer ...." (Ex. A-15-2) Wisconsin Council 40, AFSCME, AFL-CIO and Unified Board of Grant and Iowa Counties

The Arbitrator agrees that it is in the interest and welfare of the public that the compensation received by Bargaining Unit members be comparable to the compensation received by like personnel in the three comparable counties, so that the County can attract and retain qualified personnel. The Arbitrator agrees that it is also in the interest and welfare of the public, however, for the County to have sufficient staff to provide the service the public demands without overworking its employees. The Arbitrator will embark, therefore, upon determining which Last Best Offer would best accomplish both elements of the interest and welfare of the public.

Before the Arbitrator does that, she must consider one more asserted aspect of the interest and welfare of the public herein. The Association argues that during negotiations for the 1993-95 Agreement, the County, through its chief negotiator Nicholas Francis, made a commitment to increase total personnel compensation 6% per year for the conceivable future. The Association contends that the County's failure to offer a 6% increase per year for the New Agreement breaks that promise. The Association argues that it would not advance the interest and welfare of the public to allow the County to renege, to the detriment of employees, on a promise it made to those employees at the bargaining table. The Association contends that employees who are treated that way will have little incentive to stay.

The County asserts that it did not make any such promise. In support of its contention that it did not commit to a 6% increase in contracts after the 1993-95 Agreement, the County did not call any witness present during the negotiations when the promise was allegedly made. Instead, it argued that no such promise would have been made, authorized or intended by the County.

Based on the record before her, the Arbitrator cannot deem the purported representation of chief negotiator Francis, even if made, to constitute a binding promise to increase fund allocated to TPC 6% each year for FY 1995-96 and FY 1996-97. In the Arbitrator's view, the credible testimony of two Association Presidents establishes that during negotiations for the Agreement before interest arbitration, Mr. Francis advocated that if the Association would agree to a 6% total personnel cost rollup, the County would promise for the conceivable future to allocate 6% each year toward increasing personnel costs. The Association, however, did not accept that "offer" and the issue went to interest arbitration. Although the issue was settled during the arbitration hearing, on the basis of a rewritten 6% cap formula, the settlement included other features not present in Mr. Francis' "offer," including a guaranteed wage increase of at least 3%. There was no testimony or other assertion that as part of, or at the time of, that settlement, the County made, and the Association accepted, a commitment to continue the rewritten 6% formula, for years after FY 1994 95, or the County in some way re-stated, and the Association accepted, Mr. Francis' earlier "offer." No such agreement is incarnated in any writing put before this Arbitrator, including the 1993-95 Agreement.

Accordingly, the Arbitrator cannot find that any offer to continue offering a 6% TPC increase for years after FY 1994-95 was both made by the County and accepted by the Association. The record simply does not establish that the two essential components of a binding agreement, an offer and acceptance of that offer by the parties thereto, both occurred. Although the Association may have thought it was accepting Mr. Francis' earlier "offer" when it settled during interest arbitration, there is no evidence that that offer was still open at that time or that it was in any way part of what the County agreed to in the settlement.

These are more than legal niceties. On the record before her, the Arbitrator cannot conclude that employees have reason to believe that the County has reneged, to those employees' detriment, on an agreement it made with the Association. Accordingly, the Arbitrator cannot conclude that it would serve the interest and welfare of the public to select the LBO herein which comes closest to implementing any such agreement.

Paragraph (b): The reasonable financial ability of the unit of government to meet the costs of the proposed contract 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, which does not include funds in contemplation of settlement of the labor dispute, shall not be considered as available toward a settlement.

The County maintains that unlike in past years, when it has included money for salary increases in a contingency or other line item, its budget for FY 1995-96 includes no such funds. The County contends that that budget does not provide for salary increases and that there are no pots of gold hidden anyplace in it from which the County could make transfers to cover the salary increases. Instead, to implement the direction from the Board to attempt to develop an improved staffing pattern, to improve or maintain service, the budget provides for the addition of 21.77 General Fund positions (including three deputy sheriff positions) and the allocation of money to them. The money allocated for the three deputy sheriff positions will not fund them for all of FY 1995-96; it allows them to be filled as of about January 1, 1996.

The language in the original version of SB 750 read:

"the financial ability of the unit of government to meet those costs, without requiring the reduction of programs or staff and giving due consideration and weight to the other services provided by, and the other priorities of, the unit of government. Unexpended cash balance or cash carry-forward or reserves resulting from under expenditure of budgeted funds or operating efficiencies in one fiscal year shall not be considered as available financial resources for expenditure in any subsequent fiscal year." (Ex. A-8-3)

The addition of the word "reasonable" to qualify "financial ability of the unit of government" and to modify the contingency funds clause to the version of SB 750 which became law means that the governing body of a public employer does not have unfettered discretion as to its financial priorities and reserves. Instead, ORS 243.746(4) imposes a standard of reasonableness, and gives interest arbitrators the duty of deciding, in cases where the public employer is claiming an inability to pay, what is reasonable.

Herein, despite the fact that its cash carryover into FY 1995-96 is expected to have exceeded the budgeted carryover figure by as much as $2.1 million, the County has persuaded the Arbitrator that it would not be able to pay the projected extra cost of the Association's LBO, over the term of the Agreement, and fund all the new County positions (or even the new Sheriff's Office positions) approved in that budget over the term of the Agreement. The County would be much more likely to be able to fund all those new positions over that term if its LBO is adopted. Consideration of this criterion, according, favors adoption of the County's LBO.

Paragraph (c): The ability of the unit of government to attract and retain qualified personnel at the wage and benefit levels provided

The record establishes that at its current compensation levels, the County does not have any difficulty attracting or retaining qualified personnel. Whether or not the County will have difficulty attracting or retaining qualified personnel if wages are not increased by the Association's LBO is not the question posed by this criterion, which relates to current wage and benefit levels. Consideration of this criterion, therefore, inveighs in favor of the Association's LBO.

Paragraph (d): The overall compensation presently received by the employees, including direct wage compensation, vacations, holidays and other paid excused time, pensions, insurance, benefits, and all other direct or indirect monetary benefits received

Paragraph (e): Comparison of the overall compensation of other employees performing similar services with the same or other employees in comparable communities. As used in this paragraph, 'comparable' is limited to communities of the same or nearest population range within Oregon.

The Association argues that these two criteria mandate a total compensation analysis. The Arbitrator agrees, although she does not agree with every element that the Association proposes including in that analysis herein.

For comparative purposes, the Arbitrator uses the classification of Deputy Sheriff, at five and twenty years of service, as the benchmark classification, because that is the classification for which the most complete, and clearest, comparative information exists on this record.

The Arbitrator uses the following modified versions of the spreadsheet format and methodology employed by the Association herein to compare, to the extent possible on this record, total compensation received by employees in the benchmark classification in the County and the three comparator counties. As the Association has already explained the elements of its spreadsheet format and methodology on the record, the Arbitrator explains her spreadsheet format and methodology only to the extent that it differs from that of the Association.(5)

With the adjustments she has made, and using this spread-sheet format, the Arbitrator believes she is coming as close to comparing apples to apples as is humanly possible at this time.(6)

The below spreadsheets include total direct and indirect monetary benefits presently received by the described employees, to the extent they are ascertainable and comparable on this record. Because of the paucity of information on the record about the Employer's Retirement Contribution, the Arbitrator has formulated and considered spreadsheet data both including and excluding that element as a benefit received by the described employees.

Comparison of Total Direct and Indirect Monetary Benefits Received By Employee in Deputy Sheriff Classification With Five Years Of Service

Without Considering the Employer's Retirement Contribution

Juris / Top Step Wage / Er Pd Retire Contr / Max Earned Incentv / Auto Incntv / Other Benes / EE Pd retire Cont (-) / ER Total Income

Clack / Top Step Wage $3448.53 / ER Pd Retire Contr +344.85 / Max Earned Incentv +172.43 / Auto Incntv +45.00 / ER Total Income =$4010.81

Lane / Top Step Wage 3456.00 / EE Pd Retire Cont (-) -207.36 / ER Total Income=3248.64

Wash / Top Step Wage 3269.57 / Er Pd Retire Contr +196.17 / ER Total Income=3465.74

AVERAGE / ER Total Income=3575.06

Cty / Top Step Wage $3438.64 / Max Earned Incentv +172.43 / Other Benes +132.26 / EE Pd Retire Cont (-) -206.32 / ER Total Income=3537.01

$3575.06-3537.01=38.05

$38.05/3537.01 = 1.075%

Considering The Employer's Retirement Contribution

Juris / Top Step Wage / Er Pd Retire Contr / Max Earned Incent(7) / Auto Incnt(8) / Other Benes / EE Pd Retire (Cont (-) / ER Retire Contr(9) / EE Total Income

Clack / Top Step Wage $3448.53 / Er Pd Retire Contr +344.85 / Max Earned Incent +172.43(10) / Auto Incnt +45.00 / ER Retire Contr +263.81 / EE Total Income=$4274.62

Lane / Top Step Wage 3456.00 / EE Pd Retire Cont (-) -207.36 / ER Retire Contr +303.44 / EE Total Income=3552.08

Wash / Top Step Wage 3269.57 / Er Pd Retire Contr +196.17 / ER Retire Contr +237.70 / EE Total Income=3703.44

AVERAGE =3843.38

Cty / Top Step Wage $3438.64 / Max Earned Incent +171.93(11) / Other Benes +132.26 / EE Pd Retire Cont (-) -206.32 / ER Retire Contr +276.12 / EE Total Income=3812.63

$3843.38 -3812.63=30.75

$30.75/3813.13 =.806%

Comparison of Total Direct and Indirect Monetary Benefits Received By Employee in Police Officer Classification With Twenty Years Of Service All Benefits Available

Without Considering the Employer's Retirement Contribution

Juris / Top Step Wage / Er Pd Retire Contr / Max Earned Incentv / Auto Incntv / Other Benes / EE Pd Retire Cont (-) / EE Total Income

Clack / Top Step Wage $3448.53 / Er Pd Retire Contr +344.85 / Max Earned Incentv +224.43(12) / Auto Incntv 180.00 / EE Total Income=$4197.81

Lane / Top Step Wage 3456.00 / Max Earned Incentv +207.36 / Auto Incntv +281.67(13) / Other Benes 172.80 / EE Pd Retire Cont (-) -207.36 / EE Total Income=3910.47

Wash / Top Step Wage 3269.57 / Er Pd Retire Contr +196.17(14) / Auto Incntv +245.22(15) / EE Total Income=3710.96

AVERAGE =3939.75

Cty / Top Step Wage $3438.64 / Max Earned Incentv +373.23(16) / Auto Incntv 145.21(17) /Other Benes +132.26 / EE Pd Retire Cont (-) -206.32 / EE Total Income=3883.02

$3939.75 - 3883.02 = 56.73

$56.73/3883-02 = 1.461%

Considering the Employer's Retirement Contribution

Juris / Top Step Wage / Er Pd Retire Contr / Max Earned Incentv / Auto Incntv / Other Benes / EE Pd Retire Cont (-) / ER Retire Contr / EE Total Income

Clack / Top Step Wage $3448.53 / Er Pd Retire Contr +344.85 / Max Earned Incentv +224.43 / Auto Incntv +180.00 / ER Retire Contr +294.75 / EE Total Income= $4461.61

Lane / Top Step Wage 3456.00 / Max Earned Incentv +207.36 / Auto Incntv +281.67 / Other Benes +172.80 / EE Pd Retire Cont (-) -207.36 / ER Retire Contr +346.37/ EE Total Income=4018.64

Wash / Top Step Wage 3269.57 / Er Pd Retire Contr +196.17 / Auto Incntv +245.22 / ER Retire Contr +255.53 / EE Total Income=3966.49

AVERAGE = 4148.91

Cty / Top Step Wage $3438.64 / Max Earned Incentv +326.67 / Other benes +132.26 / EE Pd Retire Cont (-) -206.32 / ER Retire Contr +302.35 / EE Total Income=3993.60

$4148.91- 3993.60 = 155.31

$155.31/3993.60 = 3.889%



As shown in these spreadsheets:

-An employee in the County's Deputy Sheriff classification who has five years of service receives total direct and indirect monetary benefits which, not including the Employer Retirement Contribution, 1.075% less than the average of such monetary benefits received by that employee's counterpart in the comparator counties.

-An employee in the County's Deputy Sheriff classification who has five years of service receives total direct and indirect monetary benefits which, including the Employer Retirement Contribution, are .806% less than the average of such monetary benefits received by that employee's counterpart in the comparator counties.

-An employee in the County's Deputy Sheriff classification who has twenty years of service and is receiving all benefits available receives total direct and indirect monetary benefits which, not including the Employer Retirement Contribution, 1.461% less than the average of such monetary benefits received by that employee's counterpart in the comparator counties.

-An employee in the County's Deputy Sheriff classification who has twenty years of service and is receiving all benefits available receives total direct and indirect monetary benefits which, including the Employer Retirement Contribution, are 3.889% less than the average of such monetary benefits received by that employee's counterpart in the comparator counties.

These findings make clear that in terms of the total direct and indirect monetary benefits received by this benchmark employee, the County compensation system for Bargaining Unit members already falls in its preferred place: within five percent of market. The Association's contention that the County will not come within five percent of market unless the Association's proposal is granted, therefore, is not borne out.

Accordingly, the Arbitrator concludes that the total direct and indirect monetary benefits received by this benchmark County employee already are competitive with those benefits received by that employee's counterpart in the comparator jurisdictions. That is true whether or not the Arbitrator accepts the County's "within five percent of market" definition of "competitive."

The Arbitrator must conclude, based on careful analysis of all the information on this record, that the Association's offer of a 4% COLA for FY 1995-96, as well as the Association's wage and benefit offer for FY 1996-97, is unwarranted in light of the above findings of her comparative total compensation analysis.

Paragraph (f): The CPI-All Cities Index, commonly known as the cost of living

The Arbitrator does not find persuasive the Association's argument that the County's offer cannot be adopted, or at least should be rejected, because its formula for the second year of its wage increases would use an CPI index other than the CPI-All Cities index specified as a criterion in ORS 243.736(4)(f). Use in a party's LBO of a formula employing another CPI index to determine a future wage increase does not violate the statutory mandate that an arbitrator look at the CPI-All Cities index as a secondary criterion in assessing that LBO in an interest arbitration. The Arbitrator cannot view the Legislature's specification of the CPI-All Cities for use as a secondary criterion by the interest arbitrator as an express rejection of the use of another CPI in the determination of future wage increases pursuant to a wage provision which is being determined in that interest arbitration.

The percent change to the U.S. All Cities Index for Urban Wage Earners and Clerical Workers for the year ending August, 1995 was 2.5% and for the year ending July, 1995 was 2.8%. The percent change to the U.S. All Cities Index for All Urban Consumers for the year ending August of 1995 was 2.6% and for the year ending July of 1995 was 2.8%.

The Association's offer of a 4% wage increase effective July 1, 1995 exceeds, and therefore is not supported, by the highest of these CPI figures: the 2.8% increase in the U.S. All Cities indices for the year ending July of 1995.

Paragraph (g): The Stipulations of the Parties

The parties have not stipulated to the use of any criteria herein other than those specified in ORS 243.746(4)(a) through (f) and (h).

Paragraph (h): Other Factors Traditionally Take into Consideration, If the Above-Cited Factors do not Provide Sufficient Evidence For an Award

In the Arbitrator's judgment, the factors set forth in paragraph (a) to (g) of ORS 243.746(4), as discussed above, provide sufficient evidence for an award herein. Accordingly, the Arbitrator, under ORS 243.746(4)(h), shall not and does not use any other factors.

Conclusion

Before enunciating her ultimate conclusions herein, the Arbitrator notes that if it was considered by itself, under the statutory criteria, the Association's request for bilingual premium pay would have to be granted. Under the new law, however, the Arbitrator must adopt or reject a party's LBO in its entirety.

Based upon her above-cited analysis, the Arbitrator concludes that the Last Best Offer of the County would best accomplish both the elements of the interest and welfare of the public most pertinent herein: that the compensation received by Bargaining Unit members be comparable to the compensation received by like personnel in the three comparable counties, so that the County can attract and retain qualified personnel, and that the County have sufficient staff to provide the services the public demands without overworking its employees.

When considered in light of the interest and welfare of the public, the County's reasonable financial ability to pay for the respective LBO's of the parties favors adoption of the County's LBO. Consideration of the County's ability to attract and retain qualified personnel at the wage and benefit levels provided also inveighs in favor of the County's LBO. Consideration of the U.S. All Cities CPI Index does not support adoption of the Association's LBO for FY 1995-96.

For all these reasons, and giving first priority to the interest and welfare of the public, the Arbitrator concludes that she must select the County's, rather than the Association's, Last Best Offer package.

ORDER

Having carefully and fully considered all the evidence and argument put before her in this matter, and based upon that evidence and argument, and the criteria prescribed in ORS 243.746(4), the Arbitrator has concluded that she must select the Last Best Offer package submitted by the County.

Accordingly, the Arbitrator selects that package.

NOW, THEREFORE, the Arbitrator orders the County to adopt the Last Best Offer package it submitted herein, effective July 1, 1995.

Respectfully submitted this twenty-ninth day of November, 1995, by,

Leslie Sorensen-Jolink, Arbitrator

Representing the Union: John Hoag, Esq., Hoag Garrettson Goldberg Fenrich Attorneys at Law

Representing the Employer: Roy Flint Labor Relations Manager Marion County, Oregon

Footnotes:

1. A lump sum payment has a one-time effect, in the year paid, and does not build into the base or, therefore, carry forward into the next year. A COLA payment made one year increases the base and that increase, the rollup cost, carries forward into the next and later years.

2. In certificate premiums, employees receive an incentive pay increment of 2.5% for an Intermediate BPST Certificate and an additional 3% for an Advanced BPST Certificate.

3. Because of the passage of SB 750 and Ballot Measure 8, the Association used a new type of spreadsheet analysis herein, as shown in Ex. A-16, for the first time. Even though they still maintain that the numbers on the spreadsheet are accurate, the drafters of the spreadsheet decided, upon reflection, that it did not accurately compute total compensation because the PERS employee payment, if made by the employee, was inadvertently subtracted. That pick-up affects the employees' income by reducing it, but does not affect the employer's cost.

Accordingly, the Association rewrote the spreadsheet so that the first subtotal reflects the income of the employee, and the last total reflects the employer costs for total compensation. The difference is that the employer-paid retirement pick-up has been moved to show it as an employee benefit and the incentives and automatic benefits have been also added to show their effect on the employee income. The employee insurance contribution and employee-paid retirement contribution are each a subtraction from the subtotal of employee income.

The rewritten spreadsheet was submitted to the Arbitrator with the Association's post-hearing brief and was submitted to the County before the date for submission of post-hearing briefs. There being no objection by the County, the Arbitrator has added the rewritten spreadsheet to Ex. A-16, as the first three pages thereof.

4. These comparisons use the tentatively agreed-upon Washington County figures.

5. For the following reasons, the Arbitrator has not included in her spreadsheet format the following compensation components which the Association included in its spreadsheet format.

a. Cleaning/Uniforms. The Arbitrator deems it appropriate not to compare this benefit, as the record does not include a per employee monthly value figure for the cleaning and uniforms received by County employees.

b. Employer Insurance Contributions. The benefit received by the employee is not the amount of the premium the employer pays for insurance coverage but the coverage itself, if the premium therefor is fully paid by the employer. To the extent that percentage is evidenced on the record, coverage for all kinds of insurance is fully-paid by the employer in all comparator jurisdictions, except that Washington County provides no vision insurance. Since the County only pays for vision coverage if the employee chooses a medical plan including it, and since the Washington County information is as of June 30, 1994 and this record does not evidence whether the tentative agreements would change this figure, the Arbitrator will not consider vision insurance in the comparison. Accordingly, the Arbitrator will view the insurance benefits received as equal in all jurisdictions, because from what the record evidences, employees in both the County and all comparator jurisdictions receive 100% employer-paid coverage for the insurance available to every employee in the jurisdiction.

c. Monthly Vacation and Monthly Holidays. The Arbitrator will consider the number of hours earned per month, rather than their monetary value (i.e. hours x hourly wage). This is because as far as the record reveals, the employee does not receive that value; the employee receives the time. The County and Washington County are identical in the number of vacation and holiday hours received per month, as far as the record reveals. Lane County employees receive 26 days per year for vacation and sick time, lumped together into a single category, while County employees receive a total of 24 days per year for vacation time and sick time. Lane County and County employees both receive a total of 88 hours per year in holiday time. The only significant difference is between the County and Clackamas County: While County employees receive 8 hours of vacation per month, Clackamas County employees receive 11.7 hours of vacation per month, which is 46.25% more than County employees. While County employees receive 8 hours of personal holidays per year, Clackamas County employee receive 16 hours of personal holidays, presumably also per year, which is 100% more than County employees.

6. Although the Arbitrator has no doubt that computerized models for comparing the components of total compensation under the new ORS 243.746(4)(d) and (e) will be developed, the constraints of time (even with a deadline extended by the parties) prohibit this Arbitrator from going further down that road herein.

7. The Maximum Earned Incentives are just that: BPST certificate premiums, bilingual pay, hazard pay, flight pay, FTO pay, to the extent available to deputy sheriffs with five and with twenty years of service.

8. The Automatic Incentives are longevity steps.

9. The Employer Retirement Contribution figures were computed by applying the Employer Retirement Contribution percentage for the county shown on Ex. A-16 to the sum of the Top Step Wage + Maximum Earned Incentives + Automatic Incentive figures.

10. The Arbitrator has moved to the Maximum Earned Incentive column for Clackamas County the $172.43 which the Association put in the Automatic Incentives column on Ex. A-16-1, as that apparently is a monthly figure to FTO pay, an earned rather than automatic incentive.

11. Because the Association included FTO pay for the five year Clackamas County deputy (and apparently meant to include it as a maximum Earned Incentive), the Arbitrator has included FTO pay as a Maximum Earned Incentive for the five year County deputy, as nothing in the Agreement indicates that that assignment would not be available to a five year County deputy.

12. This $224.43 consists of $172.43 for FTO pay and $52.00 for Advanced BPST Certificate pay.

13. This $281.67 is the effect of longevity steps of 2.5% (computed on top step wage plus Advanced BSPT Certificate pay of $207.36) received at 10, 15 and 20 years.

14. The record does not clearly reflect what the premium pay for an Advanced BPST Certificate currently is in Washington County or reflect what it will be under the tentative agreements. Accordingly the 20-year Employee Total income figure for Washington County is low.

15. This $245.22 is longevity pay, at 7.5% of top step wage. As the Advanced BPST Certificate pay is unknown, the Arbitrator has not been able to add it to the top step wage, for purposes of determining longevity pay (as Ex. R-10-3 indicates should be done).

16. This $373.23 consists of $191.71 in Advanced BPST Certificate pay (of 2.5%, then 3%, computed on and added to top step wage, to result in a figure of $3630.35) plus $181.52 in FTO pay (computed at 5% on that $3630.35 top step wage plus Advanced BPST figure).

17. This $145.21 is the effect of the longevity step of 4% for 15 years service (computed on top step wage plus Advanced BPST Certificate pay of $191.71).

 

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