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A Better Partnership
June 13, 2013

MSC determines that refusal to bargain over change in actuarial table to calculate employee retirement benefits did not constitute an unfair labor practice

Under the public employment relations act (PERA), the failure of public employers to bargain with their employees' representatives regarding the "terms and conditions of employment" constitutes an unfair labor practice. The calculation of retirement benefits is a mandatory subject of collective bargaining. In Macomb County v. AFSCME Council 25, in a 4-2 decision, the Michigan Supreme Court held that the Macomb County Retirement Commission did not commit an unfair labor practice when it refused to bargain over its decision to change the actuarial table used to calculate joint and survivor retirement benefits, and that the appropriate forum for challenging the refusal to bargain is the grievance and arbitration process pursuant to the parties' collective bargaining agreements. The majority opinion, written by Chief Justice Young, reaffirmed that the scope of authority of the Michigan Employment Relations Commission in reviewing a collective bargaining agreement in the context of a refusal-to-bargain claim, where parties have agreed to a grievance or arbitration process, is limited to determining whether the agreement covers the subject of the claim.

In a dissenting opinion, Justice McCormack, joined by Justice Cavanagh, would conclude that the parties' use of a specific formula for achieving "actuarial equivalence " for 24 years amended the contract, and thus requires a return to the bargaining table before a unilateral change may be made to that intentional practice. Justice Viviano took no part in the decision of this case.

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