My law partner, Gabe Jiran, talks today about whether it’s all that easy to change the terms of a collective bargaining agreement.  Is it just as easy as a vote? Or does it require something more? The answer has implications for all employers.  

With all of the talk about the financial difficulties faced by the government, I, and others in here, sometimes get the question of whether the State of Connecticut or other states might try to change the laws on collective bargaining or try to pass legislation to alter the terms of its existing collective bargaining agreements.

Other states have started down this road, but it is not that easy.

Recently, the Connecticut Attorney General was asked to opine on whether the General Assembly could statutorily change the contracts covering State employees to address the fiscal crisis.  A link to the opinion is here.

The short answer is that the State could do so, such as by passing a statute that wage increases be delayed or eliminated in State contracts.

However, the United States Constitution imposes a pretty heavy burden on the State to justify any such changes.

The relevant factors are:

  1. the severity of the fiscal crisis;
  2. the nature and duration of the contractual changes;
  3. the extent that the State has attempted to implement other alternatives in the past;
  4. the extent to which the State has studied and made findings about the feasibility of other alternatives;
  5. whether these alternatives would be a less dramatic option;
  6. the extent to which the fiscal crisis existed or was foreseeable when the State entered into the existing contract; and
  7. the State’s representations during negotiations for the existing contract.

Based on cases utilizing some or all of these factors, the State would face an uphill battle if it wanted to change an existing contract.

For example, a federal appeals court struck down the State of New York’s plan to delay wage increases for employees because New York had alternatives such as raising taxes or shifting money around in its budget.  In another New York case, the same court found that a $1 billion deficit was not a dire enough fiscal crisis to justify a delayed wage increase.

However, one case found that the City of Buffalo was able to impose a wage freeze when it was undeniable that Buffalo was in a fiscal emergency and that the wage freeze was a last resort after looking at other options.

In discussing the matters with others here, we expect that Connecticut and other states will continue to look for creative options to address their financial situations with employees.

However, it is doubtful that these options will involve changes to existing contracts without negotiation with the unions involved.  In addition, any State attempts to change contracts in the private sector would be almost certain to fail.

Imagine there’s no …..

A few years ago it would have been unfathomable to be considering life in Connecticut without a Commission on Human Rights and Opportunities.  After all, it is a necessary step in filing a discrimination complaint in this state.

Imagining a Connecticut without the CHRO? No way.

But suddenly, dramatically, here we are.   With the union concession package widely expected to be voted down later Friday morning, we’re into uncharted territory.  And, there are a lot of questions still to be answered.

First, will Governor Malloy actually shut down the agency? That’s unknown, though closing it down was among the various list of cuts proposed back in May. Resulting savings are over $6M.  Pure speculation among lawyers at the CBA Annual Meeting yesterday about whether that would happen was split, though some type of cuts to the agency would certainly seem likely.

Shutting down the agency would be relatively easy compared to what might happen afterwards, though.

For example, what will happen to existing claims at the CHRO? Presumably, the legislature would have to enact legislation that immediately provides those individuals with a “right to sue” in state court.  Some coordination would need to be planned, though, with the EEOC since every claim filed at the CHRO is typically cross-filed with that agency.  Will the EEOC pick up investigating some claims? Given their budget issues, that appears unlikely as well.

Next question: What happens to the statute of limitations? After all, in order for state discrimination claims to proceed, a complainant must file a CHRO complaint within 180 days.  When there’s no complaint to be filed, what happens next? Again, we’ll have to await word from the General Assembly.

But while some have previously called for the elimination of the CHRO, be careful for what may happen next, which is filing of many more lawsuits against employers that would otherwise have been handled by the agency.  Indeed, if all those cases went to court, you could see an 5-8 percent rise in the number of cases in our court system.  On the flip side, the courts are likely to be so overwhelmed with new claims with diminishing resources, that cases may drag on and on there.

What’s the Takeaway for Employers?

The budget battle may hit home in unexpected ways.  Keep up with the developments surrounding the CHRO and stay tuned to see if there are going to be any other cuts to relevant state agencies such as the Department of Labor.

It’s not just job cuts that we are likely to see, but programs and services being eliminated too.

Imagine a world without the CHRO? Ready, Set, …….