No. 49 March Term, 1976, Appeal from the Order of the Commonwealth Court of Pennsylvania at No. 1293 C.D. 1974.
James L. Crawford, Raymond W. Cromer, Asst. Attys. Gen., Pa. Labor Relations Bd., Harrisburg, for appellant.
Charles E. Dillon, Dillon, McCandless, King & Kemper, Butler, for appellee.
Jones, C. J., and Eagen, O'Brien, Roberts, Pomeroy and Manderino, JJ. Pomeroy, J., filed a concurring and dissenting opinion. Jones, former C. J., did not participate in the decision of this case. Nix, J., did not participate in the consideration or decision of this case.
Appellee Mars Area School District and the Mars Area Association of School Services Personnel, the duly certified bargaining agent of employees of appellee, were parties to a collective bargaining agreement covering the terms and conditions of employment of "teacher-aides," members of the bargaining unit the Association represents. The Association filed with appellant Pennsylvania Labor Relations Board an unfair labor practice charge, alleging appellee violated Sections 1201(a)(1) and 1201(a)(5) of the Public Employe Relations Act (Act 195)*fn1 by unilaterally terminating the employment of teacher-aides and replacing them with unpaid volunteers. Appellee answered and admitted terminating employment, but contended that its conduct was lawful because it was prompted by economic considerations. After a hearing, the Board found that volunteers
were substantially performing the duties of teacher-aides. In its final order, the Board agreed with the Association that appellee's unilateral conduct constituted a refusal to bargain with the Association, in violation of Sections 1201(a)(1) and 1201(a)(5). The Court of Common Pleas of Butler County reversed the final order of the Board. The Board then appealed to the Commonwealth Court, which affirmed. We granted the Board's petition for allowance of appeal and now reverse the Commonwealth Court and reinstate the final order of the Board.*fn2
Section 701 of Act 195 provides:
" Matters subject to bargaining
Collective bargaining is the performance of the mutual obligation of the public employer and the representative of the public employes to meet at reasonable times and confer in good faith with respect to wages, hours and other terms and conditions of employment, or the negotiation of an agreement or any question arising thereunder and the execution of a written contract incorporating any agreement reached but such obligation does not compel either party to agree to a proposal or require the making of a concession."
" Matters not subject to bargaining
Public employers shall not be required to bargain over matters of inherent managerial policy, which shall include but shall not be limited to such areas of discretion or policy as the functions and programs of the public employer, standards of services, its overall budget, utilization of technology, the organizational structure and selection and direction of personnel. Public employers, however, shall be required to meet and discuss on policy matters affecting wages, hours and terms and conditions of employment as well as the impact thereon upon request by public employe representatives."
Here, the question is whether the Board correctly determined that the dismissal of the Association's teacher-aides and substitution of volunteer workers was a subject of "collective bargaining" within the meaning of Section 701, or one of "inherent managerial policy" within the meaning of Section 702, subject to appellee's unilateral action.
In Pa.L.R.B. v. State College Area School District, 461 Pa. 494, 337 A.2d 262 (1975), we were confronted for the first time with Section 701's requirement that public employers bargain collectively with employee representatives "with respect to wages, hours and other terms and conditions of employment" as circumscribed by Section 702's directive that "[p]ublic employers shall not be required to bargain over matters of inherent managerial policy." Mr. Justice Nix, speaking for the Court, summarized the essence of collective bargaining in the public sector:
'[T]he legislature at the time of the passage of Act 195 fully recognized that the right of collective bargaining was crucial to any attempt to restore harmony in the public sector. It would be absurd to suggest that the legislature deliberately intended to meet this pressing need by providing an illusory right of collective bargaining.
[Act 195] was a repudiation of the traditional concept of the sanctity of managerial prerogatives in the public sector."
461 Pa. at 504, 506, 337 A.2d at 266, 267. Against this background, this Court fashioned the appropriate test:
"Thus we hold that where an item of dispute is a matter of fundamental concern to the employes' interest in wages, hours and other terms and conditions of employment, it is not removed as a matter subject to good faith bargaining under section 701 simply because it may touch upon basic policy. It is the duty of the Board in the first instance and the courts thereafter to determine whether the impact of the issue on the interest of the employe in wages, hours and terms and conditions of employment
outweighs its probable effect on the basic policy of ...