High Court Throws Out Binding Arbitration Law

California cannot require city and county governments to submit to binding arbitration during labor disputes with law enforcement officers and firefighters, the California Supreme Court ruled Monday.

The unanimous ruling -- a victory for local government officials -- struck down a 3-year-old law, which was sponsored by Senate President Pro Tem John Burton and signed by Gov. Gray Davis. The justices ruled that the law, which had been sought by labor unions for decades, violated the state Constitution.

The ruling eliminates binding arbitration in labor disputes involving cities and counties, unless the governments approve it. Monday’s decision was a setback for public safety workers’ labor unions. The law, which took effect in 2001, gave labor, but not management, the right to declare an impasse and invoke binding arbitration.

“The court’s decision has opened a Pandora’s box that threatens a plethora of protections for local government employees,” said Dan Terry, president of the California Professional Firefighters. “Everything from antidiscrimination to the minimum wage could be challenged under this decision.”

Terry said that the law allowing for arbitration was designed to prevent the kind of public safety strikes that crippled some cities more than two decades ago. “This decision opens the door to a return to those ‘bad old days,’ ” he said.

Several counties challenged the constitutionality of the law, which provided for private judges to resolve labor disputes. Both sides were bound by what the judges, or arbitrators, decided.

Los Angeles City Administrative Officer Bill Fujioka said he was pleased with the court’s decision. The city had joined in the case as a friend of the court.

“There is an inherent problem with relying on the decision of an arbitrator to set your salary structure,” Fujioka said. “The impact it could have on a major city budget like Los Angeles’ is a very risky proposition.”

In an opinion written by Justice Ming W. Chin, the court held that the law permitting binding arbitration violated a state constitutional provision that forbids the Legislature from delegating municipal functions to a private party.

“No county is an island, entire of itself,” Chin wrote. “No doubt almost anything a county does, including determining employee compensation, can have consequences beyond its borders.

“But this circumstance does not mean this court may eviscerate clear constitutional provisions, or the Legislature may do what the Constitution expressly prohibits it from doing.”

The court reached its decision in a case involving Riverside County. The county had been negotiating with probation department employees when the two sides reached a stalemate in 2001.

The sheriff’s association wanted an arbitrator appointed, as the law allowed. The county balked and sued, contending that the law violated the state Constitution. A state Court of Appeal agreed with the county. As the case was pending, Riverside County and the employees settled.

California cities and counties and a taxpayers group sided with Riverside, and police, firefighters and other labor groups argued on behalf of the employees in Riverside vs. Superior Court.

Chief Justice Ronald M. George, in a separate opinion, agreed with the result in the case but complained that the holding too broadly restricted legislative powers.

Justice Carlos R. Moreno also wrote separately, supporting the result but offering a different legal analysis. Moreno wrote that a statewide emergency could potentially justify the law the court has struck down.

Steve Mayer, Riverside County’s lawyer, said state employees do not have that right.

“The Legislature isn’t going to give up the power of the purse to some private person,” Mayer said. “They don’t mind taking away local governments’ power, but they are not going to take their own power away.”

Mayer said that many cities and counties face budget deficits, and that the ruling will prevent them from paying wages higher than they can afford.

Different courts have reached different results in county challenges of the law, but no city or county has been forced to abide by an arbitrator’s decision it did not like, Mayer said.

Burton was unavailable for comment.