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United Pub. Workers v. Abercrombie

Supreme Court of Hawai'i

February 28, 2014

UNITED PUBLIC WORKERS, AFSCME, LOCAL 646, AFL-CIO, Petitioner/Plaintiff-Appellant,
v.
NEIL ABERCROMBIE, [1] Governor, State of Hawai'i; Kalbert K. Young, Director, Department of Budget and Finance, State of Hawai'i; Barbara A. Krieg, Director, Department of Human Resources Development, State of Hawai'i; Ted Sakai, Director, Department of Public Safety, State of Hawai'i, [2] Respondents/Defendants-Appellees

CERTIORARI TO THE INTERMEDIATE COURT OF APPEALS. CAAP-12-0000505; CIV. NO. 09-1-2145-09 PWB.

Rebecca Covert, Herbert R. Takahashi, and Davina W. Lam, for petitioner.

Richard H. Thomason, for respondent.

RECKTENWALD, C.J., NAKAYAMA, AND McKENNA, JJ., WITH ACOBA, J., CONCURRING AND DISSENTING, WITH WHOM POLLACK, J. JOINS.

OPINION

Page 601

[133 Hawai'i 189] McKENNA, J.

I. Introduction

This case concerns the application of the primary jurisdiction doctrine by the Intermediate Court of Appeals (" ICA" ) to a lawsuit filed in circuit court by the United Public Workers, AFSCME, Local 646, AFL-CIO (" UPW" ), on behalf of the employees (" Employees" ) it represents. UPW presents the following question: " Whether the ICA erred by ordering the circuit court to stay this case under the doctrine of 'primary jurisdiction' even though the claims are within the original jurisdiction of the circuit courts and do not present issues committed to the specialized administrative expertise of the Hawai'i Labor Relations Board."

Page 602

[133 Hawai'i 190] UPW sought relief in the Circuit Court of the First Circuit (" circuit court" ) alleging that then-Governor Lingle and members of her administration retaliated against UPW members for filing a lawsuit opposing her 2009 statewide furlough plan. In addition, UPW alleged that the State was unlawfully privatizing positions historically and customarily performed by civil servants under the merit system. UPW's retaliation claims were brought under (1) the Hawai'i Whistleblowers' Protection Act (" HWPA" ),[3] and (2) article I, section 4 of the Hawai'i Constitution (" Free Speech Clause" or " Free Speech retaliation claim" )[4]. UPW's privatization claims were brought under (1) article XVI, section 1 of the Hawai'i Constitution,[5] and (2) Hawai'i Revised Statutes (" HRS" ) § 76-43 (Supp. 2010).[6]

We hold that UPW's retaliation claims are originally cognizable in the circuit courts; however, the ICA correctly ruled that pursuant to the doctrine of primary jurisdiction, the enforcement of UPW's retaliation claims requires the resolution of issues that have been placed within the special competence of the Hawai'i Labor Relations Board (" HLRB" ) under HRS Chapter 89. The ICA also correctly ruled that the circuit court should have stayed rather than dismissed the UPW's retaliation claims pending the HLRB's determination of issues within UPW's claims that were within the HLRB's special competence. We hold that pursuant to Konno v. County of Hawai'i, 85 Hawai'i 61, 937 P.2d 397 (1997), however, the primary jurisdiction doctrine does not apply to UPW's privatization claims.

Accordingly, we affirm the ICA's judgment on appeal vacating the circuit court's " Order Granting Defendants' Second Motion to Dismiss Plaintiff's Complaint Filed September 16, 2009" and May 15, 2012 Final Judgment. We disagree, however, with the ICA's remand instructions to the extent that it ordered the circuit court to stay UPW's privatization claims. We agree that the circuit court must stay the retaliation claims pursuant to the primary jurisdiction doctrine, but the primary jurisdiction doctrine does not apply to UPW's privatization claims; therefore, we instruct the circuit court to proceed consistent with this opinion.

II. Background

A. Factual Background [7]

1. Attempted Furlough and Injunction

On June 1, 2009, then-Governor Linda Lingle announced that state employees would be furloughed three days per month for two years to allow the state to avoid having to lay off employees. On June 16, 2009, UPW filed a complaint in the circuit court (" Furlough Lawsuit" ) " for violations of state law under Article XIII, Section 2,[8] and other State Constitution provisions," and sought injunctive

Page 603

[133 Hawai'i 191] relief to enjoin the state from implementing the furloughs.[9] On July 2, 2009, the circuit court [10] concluded that the defendants had violated the State Constitution by attempting to impose the furloughs without collective bargaining, and granted UPW's injunction, enjoining the unilateral statewide furloughs.

2. Reduction in Force Announcement

Soon thereafter, on July 17, 2009, Marie Laderta (Defendant Laderta), Director of the Department of Human Resources Development, notified various public employees that their names would be included on layoff lists. Approximately 216 UPW employees were on the list. On July 23, 2009, Clayton Frank (" Defendant Frank" ), Director of the Department of Public Safety, notified UPW of an impending layoff due to the closure of the Kulani Correctional Facility. On August 4, 2009, Defendant Lingle announced a decision to implement a reduction in force (" RIF" ) that would discharge approximately 1,100 State employees.

3. Privatization

UPW alleged that on June 8, 2009, UPW requested that Defendants Lingle and Laderta terminate all contracts for services that have historically and customarily been performed by civil servants in bargaining units 1 and 10. UPW alleged that the Defendants refused.[11]

UPW also alleged that Defendants refused to negotiate over the (1) decision to close Kulani Correctional Facility, and (2) implementation of that decision. On August 3, 2009, Defendant Frank informed the inmates at Kulani of their relocation by the end of September 2009. UPW alleged that the Department of Public Safety then subcontracted with private contractors to house approximately 2,000 Hawai'i inmates on the mainland.

B. Procedural History

1. HLRB Prohibited Practice Complaint

Page 604

On August 27, 2009, UPW filed an amended complaint with the HLRB (" HLRB Complaint" ) against Defendants Laderta, Lingle, and Frank (" Defendants" ). [12] The HLRB Complaint alleged a number of violations under HRS § 89-13(a) (" prohibited practice violations" ). In relevant part, the HLRB Complaint alleged that the Defendants: (1) violated HRS § 89-13(a)(1) when Defendant Lingle interfered, restrained, and coerced employees in their exercise of statutory and constitutional rights by threatening mass layoffs and the shutdown of programs; (2) violated HRS § 89-13(a)(3) when Defendants discriminated regarding terms and conditions of employment to discourage membership in an employee organization through threats to job security, implementation of RIF, layoffs, and discharges; (3) violated HRS § 89-13(a)(5) by refusing to bargain collectively in good faith over furloughs as an alternative to layoffs, and for unilaterally implementing procedures and criteria for RIF displacements, and discharges of bargaining unit employees; (4) violated HRS § 89-13(a)(7) by refusing to comply with provisions of Chapter 89, including HRS § § 89-3 [13] and 89-9(a) [14], (c) [15], and [133 Hawai'i 192] (d)[16]; and (5) violated HRS § 89-13(a)(8) by violating the terms of the unit 1 and 10 collective bargaining agreements.

The HLRB entered its Findings of Fact and Conclusions of Law on October 23, 2009. In relevant part, the HLRB found: (1) the record indicated that the State at all relevant times was facing a severe fiscal crisis that required it to balance its budget in the face of ever-increasing revenue shortfalls; (2) Defendant Lingle's consideration of layoffs of public employees as a means of addressing the predicted revenue shortfall preceded the filing of grievances or civil lawsuits by UPW; (3) the State had presented a legitimate, non-discriminatory, and non-retaliatory reason for its decision to lay off workers, and the Union had not presented evidence to rebut the State's assertions (the decline of revenues) or demonstrated that the stated reason was merely pretextual.

2. Circuit Court Complaint

Before the HLRB had issued its findings, UPW filed a complaint in the circuit court (" First Circuit Complaint" ) on September 16, 2009, alleging that Defendants' actions: (1) constituted acts of retaliation, reprisal, and intimidation in violation of the HWPA; (2) violated Employees' rights guaranteed by the Free Speech Clause; (3) violated the merit principle [17] mandated by article XVI, section 1 of the Hawai'i Constitution;

Page 605

[133 Hawai'i 193] and (4) violated Employees' rights under HRS § 76-43 by " refusing to negotiate the criteria, procedures, timing, and manner of handling mass layoffs for reasons other than 'lack of work' or 'lack of funds' with UPW prior to unilateral implementation of the layoffs, reductions in force, and discharges of unit 1 and 10 employees." [18]

Defendants then filed a Motion to Dismiss the First Circuit Complaint on the grounds that: (1) UPW did not identify any " employees" protected by HWPA, and UPW is not an employee itself; (2) UPW's complaints did not include any facts that could " underlie a freestanding constitutional claim premised on access to the courts" ; (3) this court in Konno v. County of Hawai'i, 85 Hawai'i 61, 70, 937 P.2d 397, 406 (1997) had already held, " the Hawai'i Constitution does not establish an independently enforceable right to the protection of merit principles" ; and (4) UPW's allegations under HRS § 76-43 are premised on the requirements of Chapter 89, Hawaii's collecting bargaining law; therefore, the HLRB had exclusive original jurisdiction over such complaints. The circuit court [19] denied Defendants' motion in its entirety.

Two years later, on September 14, 2011, Defendants filed a second Motion to Dismiss in the circuit court on the basis that this court had recently clarified that the HLRB had " exclusive original jurisdiction over the controversy" in Hawai'i Government Employees Association v. Lingle (" HGEA" ), 124 Hawai'i 197, 239 P.3d 1 (2010).[20] On January

Page 606

[133 Hawai'i 194] 17, 2012, this court published Hawai'i State Teachers Association v. Abercrombie (" HSTA" ), 126 Hawai'i 318, 271 P.3d 613 (2012),[21] which further clarified and affirmed our decision in HGEA.

On February 15, 2012, the circuit court [22] granted Defendants' second Motion to Dismiss and dismissed all claims based on its conclusion that the circuit court lacked jurisdiction. The circuit court found that the underlying facts in UPW's First Circuit Complaint essentially mirrored those alleged by UPW in the " prohibited practice" claims before the HLRB. It concluded that HRS § 89-14 provided HLRB with exclusive original jurisdiction over controversies implicating prohibited practices, and therefore, " it would be wholly inconsistent with HLRB's exclusive, original jurisdiction for the First Circuit to hear the same underlying factual disputes and allegations and create the possibility of inconsistent judgments."

The circuit court also concluded that the statutory scheme required that HLRB be given the opportunity to address the allegations in UPW's prohibited practice complaint. The circuit court would then review HLRB's decision in its appellate capacity. The circuit court also concluded that the additional claims raised in the First Circuit Complaint, not included in the HLRB complaint, were essentially prohibited practices, and stated that it lacked " primary subject matter jurisdiction" over those claims because exclusive, original jurisdiction rested with the HLRB.

Finally, to the extent that the First Circuit Complaint raised constitutional and statutory claims over which the HLRB lacked subject matter jurisdiction, the circuit court concluded that under HGEA, the HLRB had to be given the opportunity to resolve the claims within its jurisdiction before a court could consider the constitutional claims in its appellate capacity.[23] The circuit court further concluded that the claims could be rendered moot if HLRB ruled against UPW on the key factual and legal questions of whether the Governor's reason for instituting layoffs were: (1) premised upon a true fiscal exigency, and were within her unilateral management powers under HRS Chapter 89, or 2) premised upon an improper desire to retaliate against UPW members for engaging in conduct specifically protected by HRS Chapter 89.

As for the " statutory claims," the circuit court concluded that " allowing parallel litigation in the circuit court while the HLRB proceeding was ongoing would both undercut the HLRB's exclusive original jurisdiction and create a risk of inconsistent judgments." The circuit court then dismissed all of UPW's claims based on a lack of jurisdiction.

D. ICA Memorandum Opinion

The ICA issued a Memorandum Opinion vacating the circuit court's judgment dismissing UPW's First Circuit Complaint, and remanded the case with instructions to stay the action pursuant to the primary jurisdiction doctrine, so that the parties could pursue appropriate administrative remedies before the HLRB. UPW v. Lingle, 129 Haw. 451, 303 P.3d 1228 (Haw. App. 2013) (mem.).

The ICA essentially agreed with the circuit court that the controversy presented to the circuit court raised issues within the HLRB's exclusive jurisdiction over prohibited practice controversies. The ICA concluded that UPW's statutory claims could be raised directly in the circuit court, but that the matter should be referred to the HLRB under the doctrine of primary jurisdiction. UPW, mem. op. at 4. Therefore, the ICA concluded that the circuit court had erred in dismissing the action because a stay, rather than dismissal without prejudice, was appropriate under the circumstances.

Page 607

[133 Hawai'i 195] The ICA concluded that UPW's First Circuit Complaint alleged conduct that was specifically defined as prohibited practices under HRS § 89-13. UPW, mem. op. at 8. The ICA concluded that UPW's layoff and privatization claims were based on allegations that Defendants had engaged in the prohibited practices of: (1) discriminating against UPW by laying off employees in retaliation for engaging in protected union activities and filing the Furlough Lawsuit; (2) discriminating against UPW members by failing to take corrective action to terminate current private contractors while implementing the layoff of UPW members; and (3) refusing to bargain collectively regarding the layoff procedures and the privatization. Id. The ICA thus reasoned that UPW's layoff and privatization claims were essentially prohibited practice claims. Id.

The ICA reasoned that this court's decisions in HGEA and HSTA reflect a concern that, " when a plaintiff presents to the circuit court a controversy that is identical to one which could have and should have been presented to the HLRB, the circuit court's exercise of jurisdiction necessarily involves a risk of interfering with the HLRB's exclusive jurisdiction over prohibited practice controversies." Id.

The ICA concluded, " UPW correctly asserts that its statutory claims could be raised directly in the circuit court." The ICA cited Konno for this assertion, indicating that it was referring to the civil service claims under HRS Chapter 76. Id. The ICA held that the doctrine of primary jurisdiction applies when a court and an agency have concurrent original jurisdiction to decide issues which have been placed within the special competence of an administrative agency; therefore, the doctrine of primary jurisdiction applied to UPW's " statutory claims." UPW, mem. op. at 9. The ICA concluded that under the doctrine of primary jurisdiction, however, dismissal is only appropriate if the parties would not be unfairly disadvantaged. Id. Because the statute of limitations could prevent UPW from refiling its claims at the conclusion of the HLRB proceedings, the ICA concluded that the proper remedy was to stay the case pending the outcome of the administrative process. Id.

III. Standard of Review

The existence of jurisdiction is a question of law that we review de novo under the right/wrong standard. HGEA, 107 Hawai'i at 183, 111 P.3d at 592. Accordingly, a court's decision to invoke the primary jurisdiction doctrine is reviewed de novo as well. P. Lightnet, Inc. v. Time Warner Telecom, Inc., No. SCWC-28948, 131 Haw. 257, 318 P.3d 97, *51 (Haw. Dec. 18, 2013). " If the court determines that the primary jurisdiction doctrine applies, the court, in its discretion, may determine whether to stay the litigation or dismiss without prejudice." Id.

IV. Discussion

A. The Primary Jurisdiction Doctrine

UPW asserts in its Application that HLRB's exclusive original jurisdiction is limited to prohibited practices related to collective bargaining: " HGEA v. Lingle and HSTA v. Abercrombie decisions were narrow rulings that related only to the constitutional right to collective bargaining, which is implemented by HRS Chapter 89." UPW argues that the decisions " did not set out a broad rule that any claim that involves facts that could also make out a 'prohibited practice' must be presented to the HLRB even if the plaintiff is not alleging a prohibited practice but a violation of other statutory or constitutional provisions."

We agree with UPW to the extent that it argues that HGEA and HSTA were narrow rulings relating only to claims alleging violations of the rights to collective bargaining. In HGEA, the plaintiffs based their request for relief on HRS Chapter 89 and the constitutional right to collective bargaining under article XIII, section 2 of the Hawai'i Constitution. 124 Hawai'i at 200, 239 P.3d at 4. We concluded that although the plaintiffs' complaint did not expressly use the words " prohibited practice," a prohibited practice could be logically inferred because the plaintiffs' complaint essentially alleged that in instituting a unilateral statewide furlough plan, Defendant Lingle had committed a prohibited

Page 608

[133 Hawai'i 196] practice when she refused to bargain collectively in good faith as required by HRS Chapter 89. Accordingly, we held that the HLRB had exclusive jurisdiction over the plaintiffs' claims pursuant to HRS § 89-14.

Unlike the plaintiffs in HGEA, the plaintiffs in HSTA deleted all references to HRS Chapter 89 in their complaint and based their request for relief solely on the constitutional right to collective bargaining under article XIII, section 2 of the Hawai'i constitution. HSTA, 126 Hawai'i at 322, 271 P.3d at 617. Nonetheless, we reiterated our holding in HGEA and emphasized that the legislative purpose of having the administrative agency with expertise in these matters decide them in the first instance is " frustrated if the HLRB's jurisdiction can be defeated by characterizing issues that fall within the scope of HRS Chapter 89 as constitutional claims and then addressing them directly to the circuit court." HSTA, 126 Hawai'i at 322, 271 P.3d at 617 (citing HGEA, 124 Hawai'i at 208, 239 P.3d at 12).

In the instant case, however, UPW's claims are based on the HWPA and the Free Speech Clause, both of which are within the original jurisdiction of the circuit court and do not facially involve violations of the constitutional or statutory rights to collective bargaining. Thus, HGEA and HSTA do not control the narrow question presented in the instant application, which essentially requires that we determine whether the primary jurisdiction doctrine applies to UPW's claims.

1. History of the Primary Jurisdiction Doctrine

The primary jurisdiction doctrine originated from the United States Supreme Court's decision in Texas & Pacific Railway Co. v. Abilene Cotton Oil Co. (" Abilene" ), 204 U.S. 426, 27 S.Ct. 350, 51 L.Ed. 553 (1907). In Abilene, a shipper sued a carrier in state court claiming that a carrier's interstate freight rate was " unjust and unreasonable." 204 U.S. at 433. The United States Supreme Court considered whether, consistent with the Interstate Commerce Act, the court had power " to grant relief upon the finding that the rate charged for an interstate shipment was unreasonable, although such rate was the one fixed by the duly published and filed rate sheet, and when the rate had not been found to be unreasonable by the Interstate Commerce Commission." Abilene, 204 U.S. at 432.

The Court opined that if the power to originally hear complaints on the subject existed in both courts and the Commission, there might be a divergence between the action of the Commission and the decision of a court. 204 U.S. at 441. The Court stated, " the established schedule might be found reasonable by the Commission in the first instance and unreasonable by a court acting originally, and thus, a conflict would arise which would render the enforcement of the act impossible." 204 U.S. at 441. Accordingly, the Court held, " a shipper seeking reparation predicated upon the unreasonableness of the established rate must, under the act to regulate commerce, primarily invoke redress through the Interstate Commerce Commission, which body alone is vested with power originally to entertain proceedings for the alteration of an established schedule[.]" 204 U.S. at 448 (emphasis added).

In United States v. Western Pacific Railroad Company (" Western P. R.R." ), 352 U.S. 59, 77 S.Ct. 161, 1 L.Ed.2d 126, 135 Ct. Cl. 997 (1956), the United States Supreme Court further refined the doctrine of primary jurisdiction. Presented with the question of whether the Court of Claims had correctly allocated the issues in a suit between the jurisdiction of the Interstate Commerce Commission and that of the court, i.e., whether the court properly applied the primary jurisdiction doctrine, the Court explained that the primary jurisdiction doctrine was concerned with promoting proper relationships between courts and administrative agencies charged with particular regulatory duties. 352 U.S. at 63-64. The Court held that unlike the exhaustion principle, which applies when a claim is cognizable in the first instance by an administrative agency alone, primary jurisdiction:

applies where a claim is originally cognizable in the courts, and comes into play whenever enforcement of the claim requires the resolution of issues which, under

Page 609

[133 Hawai'i 197] a regulatory scheme, have been placed within the special competence of an administrative body; in such a case the judicial process is suspended pending referral of such issues to the administrative body for its views.

Western P. R.R., 352 U.S. at 63-64 (citing General Am. Tank Car Corp. v. El Dorado Terminal Co., 308 U.S. 422, 433, 60 S.Ct. 325, 84 L.Ed. 361 (1980) (holding that the District Court had jurisdiction over the action in assumpsit; however, in light of the provisions of the Interstate Commerce Act, " it should not have proceeded to adjudicate the rights and liabilities of the parties" in the absence of a decision by the Interstate Commerce Commission with respect to the validity of the practice involved)).

Thus, the doctrine of primary jurisdiction arose from a concern that an established rate schedule could be found reasonable by the agency tasked with this determination, but unreasonable by a court, thereby triggering a conflict that could render the enforcement of the Interstate Commerce Act impossible. Abilene, 204 U.S. at 441. The doctrine was later refined to include the principle that in cases raising issues of fact not within the conventional experience of judges or requiring the exercise of administrative discretion, agencies created by Congress for regulating the subject matter should not be passed over. Western P. R.R., 352 U.S. at 77; Far East Conference v. United States, 342 U.S. 570, 574, 72 S.Ct. 492, 96 L.Ed. 576 (1952) (holding that the Federal Maritime Board's primary jurisdiction over matters concerning the Shipping Act of 1916 precluded the District Court for New Jersey from passing on the merits of the lawsuit, which was brought under the Sherman Anti-Trust Act).

2. Primary Jurisdiction in Hawai'i

This court adopted the doctrine of primary jurisdiction directly from Western P. R.R., holding that primary jurisdiction applied " where a claim is originally cognizable in the courts, and comes into play whenever enforcement of the claim requires the resolution of issues which, under a regulatory scheme, have been placed within the special competence of an administrative body." Kona Old Hawaiian Trails Group v. Lyman, 69 Haw. 81, 93, 734 P.2d 161, 168 (1987) (citing Western P. R.R., 352 U.S. at 63-64). We concluded, " [w]hen this happens, the judicial process is suspended pending referral of such issues to the administrative body for its views." Id. (citing Western P. R.R., 352 U.S. at 64). We opined, " [i]n effect, the courts are divested of whatever original jurisdiction they would otherwise possess. And 'even a seemingly contrary statutory provision will yield to the overriding policy promoted by the doctrine.'" 69 Haw. at 93, 734 P.2d at 168-69 (citing B. Schwartz, Administrative Law § 8.24, at 488 (2nd ed. 1984) (emphasis omitted)).

In Kona Old, the plaintiffs' invoked the circuit court's jurisdiction pursuant to HRS § § 91-14(a),[24] 205A-6,[25] and 603-21,[26] seeking a ruling that the director had violated the Coastal Zone Management Act (" CZMA" ) in issuing a special management area (" SMA" ) minor use permit, and an order voiding the

Page 610

[133 Hawai'i 198] permit and enjoining an authorized construction of real property situated within the special management area of Kailua-Kona. 69 Haw. at 89, 734 P.2d at 166. We concluded that the issuance of a SMA minor permit and its enforcement required the resolution of issues which, under CZMA's regulatory scheme, had been placed within the special competence of the county planning department. Id. at 93, 734 P.2d at 169. We held, " the request for judicial intervention in the administrative process should not have preceded the resolution by the Board of Appeals of the question of whether the planning director's action in issuing the minor permit was proper." Id. Accordingly, this court applied the doctrine of primary jurisdiction and affirmed the circuit court's dismissal of the case. Id.

We have similarly applied the doctrine of primary jurisdiction to claims originally cognizable in the circuit court but containing issues that first require a determination by an administrative agency. See Chun v. Emps. Ret. Sys. of State of Haw., 73 Haw. 9, 13, 828 P.2d 260, 262 (1992) (holding that the considerations of uniformity and consistency in a specialized agency's administration of the Employees' Retirement System, mandated suspension of the judicial process pending an initial review of the issues by the administrative body). See also Jou v. Nat'l Interstate Ins. Co. of Haw., 114 Hawai'i 122, 128, 157 P.3d 561, 567 (App. 2007) (applying the primary jurisdiction doctrine and referring the question of whether a workers' compensation carrier acted unreasonably or in bad faith to the Director of the Department of Labor and Industrial Relations before proceeding with a bad faith tort claim in circuit court). But see Aged Hawaiians v. Hawaiian Homes Comm'n, 78 Hawai'i 192, 202, 891 P.2d 279, 289 (1995) (holding that the doctrine did not apply where (1) a pure question of law is at issue and technical matters calling for the special competence of the administrative expert are not involved; and (2) cases in which the constitutionality of the agency's rules and procedures is challenged and questions are raised as to whether the agency has acted within the scope of its authority).

Notwithstanding, " [n]o fixed formula exists for applying the doctrine of primary jurisdiction. In every case the question is whether the reasons for the existence of the doctrine are present and whether the purposes it serves will be aided by its application in the particular litigation." Western P. R.R., 352 U.S. 59, 64, 77 S.Ct. 161, 1 L.Ed.2d 126, 135 Ct. Cl. 997.

B. UPW's Retaliation Claims

1. Framework for the Application of the Primary Jurisdiction Doctrine

As discussed above, this court adopted the doctrine of primary jurisdiction directly from the United States Supreme Court's opinion in Western P. R.R., 352 U.S. 59, 77 S.Ct. 161, 1 L.Ed.2d 126, 135 Ct. Cl. 997. The plaintiffs in Western P. R.R. had brought suit in the Court of Claims under the Tucker Act [27] to recover money from the United States. 352 U.S. at 60 n.1. The United States Supreme Court was specifically presented with the question of whether the Court of Claims had properly applied the doctrine of primary jurisdiction; that is, whether it had correctly allocated the issues in the suit between the jurisdictions of the Interstate Commerce Commission and that of the court. 352 U.S. at 64. We are similarly presented in the instant case with the question of whether the ICA properly applied the doctrine of primary jurisdiction to UPW's claims, even when the circuit court had original jurisdiction over those claims. Accordingly, the Court's reasoning in its application of the doctrine is particularly instructive to the instant case.

In Western P. R.R., the Court explained that the determination of whether a lower

Page 611

[133 Hawai'i 199] court had properly applied the doctrine of primary jurisdiction required an examination of whether the Act conferring jurisdiction upon the Interstate Commerce Commission, the Interstate Commerce Act, required the agency to first pass on the issue in dispute, which in turn depended on whether the controversy in dispute raised " issues of transportation policy which ought to be considered by the Commission in the interests of a uniform and expert administration of the regulatory scheme laid down by that Act." 352 U.S. at 65. Based on these factors, the Court held that the issues presented in the claim were initially matters for the Commission's determination, even if the suits had been brought under the Tucker Act, and not the Interstate Commerce Act. Id. at 70.

UPW's retaliation claims are unquestionably cognizable in the circuit court. UPW alleges, however, that Defendant Lingle retaliated against UPW members for filing the Furlough Lawsuit. The Furlough Lawsuit was an assertion of the Employees' right to collective bargaining, alleging that Defendant Lingle violated collective bargaining laws by unilaterally imposing statewide furloughs. Although UPW's retaliation claims do not specifically assert the right to collective bargaining, prohibited practice claims under HRS § 89-13 nevertheless appear to be implicated by virtue of UPW's allegation that Defendants implemented the layoffs in retaliation for the Furlough Lawsuit.

An examination of the law governing the HLRB's jurisdiction under HRS Chapter 89, therefore, is necessary to determine whether the doctrine of primary jurisdiction applies. Specifically, HRS Chapter 89 must be examined to determine whether it requires the HLRB to first pass on the controversy, which in turn depends on whether the controversy raises policy issues concerning matters that ought to be considered by the HLRB in the interests of a uniform and expert administration of the regulatory scheme laid down by HRS Chapter 89.

a. The Regulatory Scheme of HRS Chapter 89, Collective Bargaining in Public Employment

HRS Chapter 89 is titled " Collective Bargaining in Public Employment." HRS § 89-1(a) outlines the following legislative findings:

[J]oint decision-making is the modern way of administering government. Where public employees have been granted the right to share in the decision-making process affecting wages and working conditions, they have become more responsive and better able to exchange ideas and information on operations with their administrators. Accordingly, government is made more effective. The legislature further finds that the enactment of positive legislation establishing guidelines for public employment relations is the best way to harness and direct the energies of public employees eager to have a voice in determining their conditions of work; to provide a rational method for dealing with disputes and work stoppages; and to maintain a favorable political and social environment.

HRS § 89-1(a). HRS § 89-1(b) states in part, " it is the public policy of the State to promote harmonious and cooperative relations between government and its employees and to protect the public by assuring effective and orderly operations of government." HRS § 89-1(b). HRS § 89-1(b) also notes that this policy is best effectuated by:

(1) Recognizing the right of public employees to organize for the purpose of collective bargaining; (2) Requiring public employers to negotiate with and enter into written agreements with exclusive representatives on matters of wages, hours, and other conditions of employment, while, at the same time, maintaining the merit principle pursuant to section 76-1; and (3) Creating a labor relations board to administer the provisions of chapters 89 and 377.

The Committee on Human Resources explained that the legislature had created the HLRB, formerly the Hawai'i Public Employment Relations Board, " to administer the provisions of Chapter 89 in an effort to promote cooperative relations between the government and its employees and to protect the public by ensuring orderly government operations." HGEA, 124 Hawai'i at 204, 239 P.3d

Page 612

[133 Hawai'i 200] at 8 (citing S. Stand. Comm. Rep. No. 597-82, in 1982 Senate Journal, at 1202). Thus, the policy motivating Chapter 89 was the promotion of cooperative relations between government and its employees, and the HLRB was specifically created to administer this policy.

The retaliation claims in the instant case clearly involve relations between the government and its public sector employees. The crux of UPW's allegation is that, because it exercised its right to collective bargaining by filing a lawsuit opposing unilateral statewide furloughs, Defendants retaliated against UPW members by laying off these members. If UPW's allegations are true, Defendants have violated the employees' right to collectively bargain by retaliating against them for asserting such rights by filing the Furlough Lawsuit. HRS Chapter 89 specifically protects the rights of public employees to exercise collective bargaining. Pursuant to HRS § 89-1, the HLRB was created to administer the provisions of Chapter 89.

In addition, HRS § 89-14 specifically supports the conclusion that UPW's retaliation claims raise issues of public employment policy that ought to be considered by the HLRB. As we explained in HGEA, HRS § 89-14 was amended in 1982 in response to the ICA opinion in Winslow v. State, 2 Haw.App. 50, 625 P.2d 1046 (1981), which conferred concurrent jurisdiction to the HLRB and circuit court over public employee prohibited practice complaints. 124 Hawai'i at 203, 239 P.3d at 7. The legislature explained that the purpose of the bill was to make the jurisdiction of the HLRB exclusive in controversies relating to prohibited practices. S. Stand. Comm. Rep. No. 597-82, in 1982 Senate Journal, at 1202. In a Report issued by the Committee on Public Employment and Government Operations, the committee explained that the phrase, " exclusive original jurisdiction" may also be referred to as " exclusive primary or initial jurisdiction." H. Stand. Comm. Rep. No. 134-87, in 1982 House Journal, at 944. The committee explained that under the bill as amended:

[A] person with a prohibited practice complaint must first file with the HLRB which would then conduct proceedings on the complaint and issue a decision or order. The complainant would not have the option of either filing the prohibited practice complaint with HLRB or in the circuit court or of filing the same complaint concurrently with both the HRLB and the court.

Id. In the report issued by the Committee on Human Resources, the committee stated that it believed that the original intent of HRS § 89-14 was to allow the HLRB to have primary jurisdiction of prohibited practice complaints because the HLRB was " the administrative agency with the expertise in public employment relations." [28] S. Stand. Comm. Rep. N. 597-82, in 1982 House Journal, at 1202 (emphasis added).

Accordingly, as amended, HRS § 89-14 provides: " Any controversy concerning prohibited practices may be submitted to the board in the same manner and with the same effect as provided in section 377-9; provided that the board shall have exclusive original jurisdiction over such a controversy[.]" Thus, HRS § 89-14 expressly requires that the HLRB first pass on prohibited practice controversies.

UPW alleges that Defendants violated the HWPA by retaliating against UPW and its members for filing and pursuing the Furlough Lawsuit in circuit court. Pursuant to HRS § 89-13(a)(4), it is a prohibited practice to: " Discharge or otherwise discriminate against an employee because the employee has signed or filed an affidavit, petition, or complaint or given any information or testimony under this chapter, or because the employee has informed, joined, or chosen to be represented by any employee organization." Viewing UPW's allegations in light of HRS § 89-13(a)(4), UPW essentially presents a prohibited practice controversy.

Thus, UPW's retaliation claims raise issues of public employment policy that ought to be considered by the HLRB in the interest of a

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[133 Hawai'i 201] uniform and expert administration of the regulatory scheme laid down by HRS Chapter 89. Moreover, the legislature explicitly conferred exclusive or " initial jurisdiction" to the HLRB over prohibited practices, such as discharging employees for filing complaints, because it recognized that the HLRB possessed expertise in matters concerning public employment. Therefore, HRS Chapter 89 requires the ...


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