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California City Ordered to Reinstate Binding Arbitration

Thursday, March, 13, 2014


The city of San Luis Obispo in California has been ordered by a state administrative law judge to reinstate a binding arbitration policy for negotiating union contracts with police and firefighter unions.  The policy was struck down via popular referendum in 2011, when 7,723 citizens of San Luis Obispo voted to repeal binding arbitration, while 2,905 supported the existing system.  The San Luis Obispo Police Officers Association filed a claim with the Public Employment Relations Board in 2011 as a result, and that claim has resulted in the current court order to repeal the referendum.


The loss of binding arbitration with the police and fire unions meant that the city could then opt for “final best offer” mechanics as it does in other negotiations.  This meant that after reasonable negotiations had been exhausted the city could simply impose their best offer on the unions with no further redress available.


The court found that the city violated labor laws in place by placing the referendum on the ballot without notifying the Police Officers Association.  It is unclear at present whether the city will appeal the decision or if it will attempt to repeat the referendum, hoping that the wide majority the measure enjoyed in 2011 still exists in enough numbers to confirm it in 2014.