IV. ANALYSIS OF SPECIFIC PROBLEM AREAS

In a prospective breakup or break-off involving LAUSD, the following specific employment-related areas must inevitably be addressed:

• Rights of Permanent Teachers Generally
• The Salary Scale
• Benefits Generally
• Retirement Income
• Placements, Transfers, and Reassignments
• The Rodriguez Consent Decree
• Ethnic Balance Issues
• Union Representation
• Employment Policies at LEARN Schools
  

A. Rights of Permanent Teachers Generally

Teachers who have achieved "permanent" status in LAUSD under state statute have acquired certain basic rights which must be considered when analyzing the impact of any breakup scenario.

California Education Code Section 35555 addresses the rights of certificated employees in the event of a district reorganization:

The reorganization of any school district or districts shall not affect the classification of certificated employees already employed by any school district affected. Such employees shall have the same status with respect to their classification by the district, including time served as probationary employees of the district, after the reorganization as they had prior to it.

Additional protections are granted by this statute to permanent employees. Indeed, the section is often seen as providing statutory protection for tenure[27] in the event of a district reorganization:

If such reorganization results in the school or other place in which any such employee is employed being maintained by another district, any such employee, if a permanent employee of the district which formerly maintained such school or other place of employment, shall be employed as a permanent employee of the district which thereafter maintains the school or other place of employment, unless such employee elects prior to February 1 of the year in which the action will become effective for all purposes to continue in the employ of the first district.

It is important to note that the last few lines of the above paragraph provide permanent employees with the right to elect to stay with their current district in the event of a reorganization.

Probationary employees have fewer rights. They must go with the district that takes over the school they were with, and of course they are subject to dismissal by the new district for all the reasons a probationary teacher can be dismissed by any district...including budgetary reasons. According to Education Code Section 35555:

If such employee is a probationary employee of the district which formerly maintained such school or other place of employment, he or she shall be employed by the district which thereafter maintains the school or other place of employment, unless such probationary employee is terminated by such district pursuant to Section 44948, 44949, or 44955, and, if not so terminated, his or her status with respect to classification by such district shall be the same as it would have been had the school or other place of employment continued to be maintained by the district which formerly maintained it.

Finally, with regard to seniority generally, Education Code Section 44847 protects educators' seniority rights, as follows:

When any school or part thereof shall have been transferred from one district to another, employment for any employees who transfer with said school or part thereof shall date from the time said employees first accepted employment (if before July 1, 1947) or rendered paid service (if after June 30, 1947) as probationary employees in the district from which the school or part thereof and the said employees were transferred.

Perhaps the most basic, primary fear facing educators is the fear of being laid off in the event of a district breakup or break-off. However, any prospective layoffs would continue to be governed not only by the statutes outlined in this section, but by a highly developed body of law that has emerged in this area at both the federal and state levels over the years.[28] In addition, most observers believe that because of the current teacher shortages, layoffs are not likely to be a major problem area in the foreseeable future.

B. The Salary Scale

Another major problem area focuses on the possibility of diminished salaries in the event of a breakup. In California, there is no salary protection for educators who move from one public school district to another. For example, if an LAUSD teacher at the top of the salary scale moved to San Francisco and took a job with SFUSD, he or she might have to begin again somewhere near the bottom of the salary scale. While proposals for a statewide salary scale have often been circulated in California, little progress has been made in this area.

It appears likely, however, that this concern is addressed by Section 35730.1 (i) of the Hayden Bill, which provides that "[a]ny reorganization of a school district with more than 500,000 pupils in average daily attendance shall require that each new district created meets the following conditions: The maintenance of the conditions of all collective bargaining agreements until their expirations." Since salary scale is a provision of the current LAUSD-UTLA Collective Bargaining Agreement, any new district created -- by either a breakup or a break-off -- must apparently adhere to this agreement.

This legal framework, however, is not airtight. At least three potential problems could arise:

1. The "More Than 500,000" problem. As discussed above in Part I-E, it is possible in a multiple break-off scenario that at some point down the road the district being reorganized would have less than 500,000 students remaining, and thus the Hayden Bill would arguably no longer apply.

2. Expiration of the Collective Bargaining Agreement in 1998. Section 35730.1 (i) requires only that the conditions of the agreement be maintained until their expiration. Since the current agreement expires a year from the coming June (June 30, 1998), it is possible to imagine a number of scenarios whereby new districts could argue that the salary scale in the agreement did not apply to them. Under one scenario, a new district may break off while negotiations continue between UTLA and the original LAUSD. The new district may argue that any agreement subsequently reached is not applicable to them. Under a more draconian scenario, an impasse may be reached between UTLA and LAUSD, and the district subsequently may break up in some manner before an agreement is reached.[29]

3. Increase in Pay for Certain Teachers in Certain New Districts. It is possible that certain districts may choose to increase pay for their teachers above and beyond the current salary scale. This could occur either under a variation of the expiration scenario described above, or even apart from any expiration of the collective bargaining agreement. Teachers in the new district are not likely to resist any offer of a salary increase, but teachers in remaining districts may very well view such an occurrence as inequitable. While this scenario might not appropriately be characterized as a problem area, since new districts would be expected to inevitably change current realities, it must nonetheless be mentioned. A variation of this scenario would of course involve the introduction of merit pay into the equation.

The likeliest conclusion under the current statutory framework, however, is that the teachers' current salary scale will follow them to their new district. And certainly a new district seeking to maintain high morale would desire such a conclusion.

C. Benefits Generally

In addition to concerns regarding salary, educators and retirees are undoubtedly concerned about maintaining their benefits. Indeed, when compared with teachers in many other districts, LAUSD teachers often hold a clear advantage with regard to both the quality and range of benefits that come with their jobs.

Under this category, three potential problem areas may be addressed: (1) accumulated leave rights, (2) current medical benefits, and (3) medical benefits upon retirement.

1. Accumulated Leave Rights. Under California Education Code Section 44976, teacher benefits in this regard are explicitly protected in the event of a possible breakup or break-off:

When any school or other place of employment shall have been transferred from one district to another, any certificated employees who transfer with said school or other place of employment shall be entitled to retain all sickness and injury, sabbatical and other leave rights accumulated by service prior to such transfer and the district to which such school or other place of employment has been transferred shall recognize or grant such rights, including any accumulated rights allowed by the governing board of the district from which the school or other place of employment was transferred, as fully as if there had been no change in the district maintaining such school or other place of employment.

2. Current Medical Benefits. Hospital, medical, dental, and vision care benefits are currently included for certificated employees in the 1995-1998 LAUSD-UTLA Collective Bargaining Agreement. Thus, as per the Hayden Bill (and the analysis above regarding salary scale), any new district created by either a breakup or a break-off must apparently adhere to this agreement...at least in the immediate future.

3. Medical Benefits upon Retirement. Not only are prospective medical benefits for retirees included in the 1995-1998 LAUSD-UTLA Collective Bargaining Agreement, but Section 35730.1 (i) of the Hayden Bill explicitly requires "recognition of existing retiree health, dental, and vision care benefits." While it would then seem that both current teachers and retirees are protected in this regard, certain features of this legal structure make these protections less than airtight.

For example, in addition to the potential problems inherent in both the finite period of the collective bargaining agreement and the possible limitations of the Hayden Bill (discussed above in the salary scale section), questions have already been raised regarding the meaning of the term "existing." Does it purport to guarantee benefits only to current retirees, or to all teachers whose rights have vested?

While the plain meaning of the statute would seem to suggest that this additional protection has been set forth only to protect "existing retirees," the Association of Retired Teachers has recently argued that the statute should be interpreted to include all "existing" benefits established for both current and future retirees.[30]

D. Retirement Income

With regard to the impact of a prospective breakup or break-off on retirement income, two areas of analysis are relevant: (1) the continued obligation to provide retirement income, and (2) the sharing of financial responsibilities between old and new districts.

1. The Continued Obligation to Provide Retirement Income. While this is arguably an unresolved issue, it is reasonable to assume that both existing retirees and current educators whose retirement rights are vested would be protected under the United States Constitution. Article I, Section 10 provides that "No State shall...pass any...Law impairing the Obligation of Contracts." The California Constitution has a similar provision, protecting contractual rights from being impaired at a subsequent time.[31] And California cases dating back to 1969 have held that all retirement benefits are considered to be fundamental contractually vested rights in this state.[32]

2. The Sharing of Financial Responsibilities between Old and New Districts. Issues relating to the division of responsibilities in an equitable manner are likely to arise in a variety of possible scenarios. For example, under a break-off scenario, both the old and the new districts might be expected to share financial responsibilities with regard to a teacher's prospective retirement income. And under a breakup pursuant to a master plan, if LAUSD as we know it disappears, at least one new district will undoubtedly be expected to carry out the former district's financial obligations with regard to current retirees.

While the division of assets and liabilities is an area that is beyond the scope of this document,[33] it should be noted that Sections 35560 - 35566 of the California Education Code directly address the disposition of "records, funds, property, and obligations" under district reorganizations.

The basic general rule in this area is spelled out in Section 35560:

When a school district is reorganized and when the allocation of funds, property, and obligations is not fixed by terms, conditions, or recommendations as provided by law, the funds, property, and obligations of a former district, except for bonded indebtedness, shall be allocated as follows:

(a) The real property and personal property and fixtures normally situated thereat shall be the property of the district in which the real property is located.

(b) All other property, funds, and obligations, except bonded indebtedness, shall be divided pro rata among the districts in which the territory of the former district is included. The basis for the division and allocation shall be the assessed valuation of the part of the former district which is included within each of the districts. (Emphasis added.)

Thus, while nothing should be taken for granted, it appears likely that retirement income will necessarily be protected under any prospective breakup scenario. Most new districts would make sure to address this area directly, and those who do not would quickly become defendants in lawsuits that they should expect to lose.

E. Placements, Transfers, and Reassignments

In general, the statutory scheme set forth above in Part IV-A regarding rights of permanent teachers would also apply to this area. And the highly developed body of employment law discussed in Part II that has emerged at both the federal and state levels over the years would also apply, particularly with regard to placements generally.[34]

In addition, transfers in general are addressed by the 1995-1998 LAUSD-UTLA Collective Bargaining Agreement.[35] Thus, since Section 35730.1 (i) of the Hayden Bill requires that "[a]ny reorganization of a school district with more than 500,000 pupils in average daily attendance" must essentially maintain "the conditions of all collective bargaining agreements until their expirations," any new district created -- by either a breakup or a break-off -- must apparently adhere to the provisons regarding transfer that the district and the union have formalized in writing..

As with the analysis set forth above regarding salary scale, however, this legal framework is not airtight. At least two potential problems could arise:

1. The "More Than 500,000" problem. As discussed above in Part I-E, it is possible in a multiple break-off scenario that at some point down the road the district being reorganized would have less than 500,000 students remaining, and thus the Hayden Bill would arguably no longer apply.

2. Expiration of the Collective Bargaining Agreement in 1998. Section 35730.1 (i) requires only that the conditions of the agreement be maintained until their expiration. Since the current agreement expires a year from the coming June (June 30, 1998), it is possible to imagine a number of scenarios whereby new districts could argue that the salary scale in the agreement did not apply to them.

The likeliest conclusion under the current statutory framework, however, is that current policies regarding placement, transfer, and reassignment will follow teachers to their new districts.

F. The Rodriguez Consent Decree

As a result of a lawsuit filed against LAUSD in 1986,[36] alleging intra-district inequalities in the area of school finance, a consent decree was reached in 1992.[37]

The Hayden Bill (California Education Code Section 35730.1 (d)) explicitly requires that each district created as a result of "any reorganization of a school district with more than 500,000 pupils in average daily attendance" comply with "the terms of the consent decree in Rodriguez v. LAUSD, Consent Decree No. C-611358." In addition, Section 35730.1 (c) requires "equity of resource distribution."

Since a central feature of the consent decree is the requirement that each school in the district maintain a teaching staff with a similar average salary, the application of Rodriguez would appear to be a thorny problem indeed. In addition to the impact of the consent decree on teacher rights vis-a-vis new assignments (see above, Parts IV-A and IV-E), a key question that would arise focuses on the relevant geographical area for implementation purposes.

If the district breaks up, would the Rodriguez "equality of distribution" formula apply (1) to the LAUSD geographical area in its entirety as one separate entity, (2) to each new district within the former geographical area as separate entities, or (3) only to what is left of LAUSD -- if indeed a district called LAUSD is left?

Under Option 1, an area-wide evaluation of compliance would occur, with the analysis taking place as if LAUSD had never in fact been broken up. Under Option 2, a separate evaluation would take place within each district that occupies at least part of the territory formerly under the control of LAUSD, independent and apart from any other evaluation for any other district. Under Option 3 -- which would be possible only in the event of a break-off -- the evaluation would focus only on the remnant of LAUSD. All three options are reasonable interpretations of the consent decree and the Hayden Bill, and it remains to be seen which of the three would be seen as more consistent with the purpose of the lawsuit, the findings of the court, and the terms of the agreement.

It should be noted that the Rodriguez consent decree has yet to be implemented, and that negotiations continue among the respective parties.[38]

G. Ethnic Balance Issues

Legal principles controlling the volatile area of teacher ethnic balance are arguably undergoing significant change in the late 1990's. A brief examination of this topic reveals a wide ranging and often contradictory body of law, which includes recent federal case law as well as local statutes, policies, and ballot initiatives.

It must be recognized that LAUSD's current effort to maintain integrated faculties throughout the district is probably best characterized as a policy decision based on no specific legal requirement. Should the district break up in some fashion, several key questions would arise in this regard. This document examines two of these questions: (1) Would a new district be obligated to continue LAUSD's policies? and (2) What legal recourse might a teacher have if he or she loses a position as a result of a new or existing district's efforts to maintain ethnic balance in the aftermath of reorganization?

1. Obligation to continue LAUSD's policies. Assuming that the Hayden Bill applies, several of its provisions would arguably operate to require each new district to continue LAUSD's policies:

--Section 35730.1 (e) requires "preservation of the policies used by magnet schools, charter schools, site-based management initiatives, and the LEARN program as those policies already exist in practice or pursuant to law." Thus, to the extent that policies currently in existence at these particular schools address faculty ethnic balance, it would appear that they would be expected to continue.

--Section 35730.1 (h) requires that "the formation of the new school districts does not result in the diminution of minority protections." Thus, to the extent that any change in faculty ethnic balance policies might be seen as such a diminution (and this might very well be a case of "first impression" for the courts, with no precedent to rely on), all districts would be expected to continue LAUSD's policies in the aftermath of a breakup.

--The aforementioned section 35730.1 (i), requiring "the maintenance of all collective bargaining agreements until their expiration," is arguably also applicable in this context, since the 1995-1998 LAUSD-UTLA Collective Bargaining Agreement contains an explicit agreement regarding "a combination of teacher-initiated and administrative transfers for the purpose of accomplishing staff integration."[39]

However, a new or existing district might reasonably conclude, based on current federal case law and recent trends, that to the extent that any ethnic balance policies provide "preferences" for certain persons on the basis of race or ethnicity, these policies are unconstitutional.[40] In addition, should California Proposition 209 (the California Civil Rights Initiative) pass in November 1996, any such preferences would arguably violate California law.

It appears likely that no matter what course of action a district might choose in the aftermath of a breakup or a break-off, this issue will probably wind up being litigated in the courts.

2. Legal recourse for teachers losing positions as a result of a district's efforts to maintain ethnic balance. While the analysis set forth above under "obligations to continue LAUSD's policies" would also be relevant to this specific question, there is in addition a very recent federal case that appears to be directly on point.

In the case, Taxman v. Piscataway Township Board of Education, 65 U.S.L.W. 2118 (3rd Cir. 1996), the public school district laid off a white teacher while retaining a black teacher of equal seniority and qualifications, pursuant to an affirmative action policy designed to achieve racial diversity in the workplace. The Federal Court of Appeals for the Third Circuit ruled that such actions violated Title VII of the Civil Rights Act of 1964. While this August 1996 decision remains applicable only in the area of the U.S. covered by the Third Circuit -- and California is covered by the Ninth Circuit -- this decision is likely to be given great deference in any future lawsuits of a similar nature.

H. Union Representation

The impact of a prospective breakup on union representation in new districts is a particularly thorny problem area which will arguably play out very differently depending on whether a breakup or a break-off occurs.

In either case -- for events occurring before June 30, 1998 -- and based on both Section 35730.1 (i) of the Hayden Bill and the Collective Bargaining Agreement that recognizes UTLA as the "exclusive representative" of the certificated employees in the district, the union will likely be seen initially as the appropriate bargaining unit for all teachers in all districts in the former LAUSD territory. This is likely to be viewed as an unprecedented position for a teachers union, and one which perhaps neither the teachers nor the union nor the districts would wish to see continue. If there is agreement among all parties, smaller bargaining units might then be formed -- perhaps with the former UTLA becoming a new umbrella organization (similar to the CTA, but on a smaller level).

In the event of a breakup based on a master plan, such issues can be addressed beforehand. In the event of a break-off, UTLA would probably remain the exclusive representative of teachers in the remnant of LAUSD after 1998, but the smaller new districts may face entirely new realities in this regard after the current collective bargaining agreement expires.

Beyond the statutes and policies mentioned above, it must be noted in addition that -- pursuant to current U.S. labor law and the aforementioned requirements of the Rodda Act -- teachers in any new district would continue to have the right (and would certainly be expected) to organize at some level to engage in collective bargaining with management.

I. Employment Policies at LEARN Schools

As more and more schools in the district become part of LEARN, shared decision-making continues to become an integral feature of the employment process at LEARN schools.

As noted above, Section 35730.1 (e) of the Hayden Bill explicitly requires "preservation of the policies used by magnet schools, charter schools, site-based management initiatives, and the LEARN program as those policies already exist in practice or pursuant to law."

Thus the analysis set forth above in Part I regarding the general applicability of the Hayden Bill is equally applicable here. Assuming that Section 35730.1 (e) controls, these policies would be expected to continue no matter which district a LEARN school ends up in. Of course, schools might wish at some point to change their policies, but that will be their community decision.

This document does not purport to address the future of LEARN generally. Such an analysis is beyond the scope of this project.

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