McCulloch v. Glendening

BELL, Chief Judge. The issue this case presents is whether the Constitution and laws of Maryland authorize the Governor, as the Chief Executive of the State of Maryland, to address by the subject executive order labor-management relations in the Executive Branch by means of a system of collective bargaining. We shall hold, under the circumstances here presented, that they do. It is well settled that not all collective bargaining agreements to which the State or a governmental agency is a party require prior express legislative approval; it is only those that contain a binding arbitration clause or are otherwise binding upon and enforceable against the State.

See Anne Arundel Co. v. Fraternal Order of Anne Arundel Detention Officers, 313 Md. 98, 113-14 , 543 A.2d 841, 848-49 (1988); Office and Prof. Empl. Int’l Union Local 2 v. Mass Transit Admin. (“MTA”), 295 Md. 88, 97 , 453 A.2d 1191, 1195 (1982); Maryland Classified Empl.

Ass’n v. Anderson (“MCEA”), 281 Md. 496, 508-513 , 380 A.2d 1032, 1038-41 (1977); Mugford v. City of Baltimore, 185 Md. 266, 270-71 , 44 A.2d 745, 747 (1945). In MTA the principle was stated thusly: absent express legislative authority, a government agency cannot enter into binding arbitration or binding collective bargaining agreements establishing wages, hours, pension rights, or working conditions for public employees. ²⁷⁶ 295 Md. at 97 , 453 A.2d at 1195 . We stated the purpose of the rule in Montgomery County Educ. Ass’n v. Board of Educ. of Montgomery County, 311 Md. 303, 313 , 534 A.2d 980, 984-85 (1987), is “to insure that a governmental agency does not, without authority, abdicate or bargain away its statutory discretion.” We must keep this principle before us as we consider the issue presented.

The genesis of this case is Executive Order 01.01.1996.13, which Governor Glendening issued on May 24,1996. 1 Entitled “Procedures for Labor-Management Relations in the Executive Branch of State Government,” the stated goal of the Executive Order is to ensure “constructive and cooperative relationships between the Executive Branch and Executive Branch employees” to the benefit of the citizens of this State. To that end, it gives to the employees 2 of the principal departments within the Executive Branch, 3 the Maryland In ²⁷⁷ surance Administration, the State Department of Assessments and Taxation, and the State Lottery Agency, ¶ A, the “right to: (l)[o]rganize, form, join or assist any employee organization; (2)[b]argain collectively 4 through representatives of their own choosing; (3)[e]ngage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection insofar as any such activity is not prohibited by any other law of the State of Maryland or this Executive Order.” ¶ C. As paragraph E(l), defining “collective bargaining,” “bargain collectively,” and “negotiate,” makes clear, the objective of giving the employees the rights set out in paragraph C is so that “[t]he parties, upon completion of negotiations, shall execute a written memorandum of understanding incorporating the terms of any agreement reached.” That paragraph also provides some conditions: to the extent [any terms of the agreement] require legislative approval or the appropriation of funds, [those] terms shall be recommended to the Legislature for approval or the appropriation of funds, as may be necessary. The duty to bargain shall include the obligation to negotiate in good faith for the purpose of resolving any questions arising under an existing memorandum of understanding. Notwithstanding the foregoing, the employer shall not be required to negotiate with regard to any matter that would be inconsistent with applicable law, and the employer may negotiate and reach agreement with regard to any such matter only if it is understood that the agreement with respect to such matter cannot become effective unless the applicable law is amended to eliminate any such inconsistency.

The Mediation Unit of the Department of Labor, Licensing and Regulation is designated by the Governor to administer the Order and, for that purpose, given certain rights. Those ²⁷⁸ rights include the power to hold hearings, conduct elections, make determinations regarding the certification of the “exclusive bargaining representative,” promulgate guidelines, and establish procedures for the implementation of the Order. ¶ D. The Mediation Unit’s powers do not include the initial determination of the bargaining units and the assignment of the employees to them; that responsibility has been given to the Secretary of Personnel 5 or the Governor’s designee. ¶ F. The Order also enumerates the factors to be used in making the unit assignments, id., and it defines the “appropriate bargaining units” in terms of nine categories of employees, ¶£(10). The Executive Order contains detailed procedures concerning the certification of “employee organizations” 6 as “employee exclusive bargaining representatives.” 7 The authority of the administrator of the Order to certify an exclusive bargaining unit and to resolve disputes with respect to the conduct of representative elections is treated in paragraph G. That paragraph also provides for employee organization agreement and, in fact, prescribes a procedure for resolving any disputes with respect to them: [I]n any election involving more than one employee organization. Such organizations can agree, subject to the approval of such official, that disputes regarding specified issues will be resolved by an impartial third party arbitrator ²⁷⁹ selected in accordance with such agreement, and the decision or decisions of such arbitrator shall be final and binding on such organizations; and provided further, that any such agreement shall provide that the costs of the arbitrator shall be shared equally by the employee organizations involved.

The procedure for an employee organization to petition for certification as the bargaining representative for a particular bargaining unit, when and by whom notice of the petition is given, and the procedure for intervention are addressed in paragraphs H, I, and J. Elections under the Order are the subject of paragraph K, while paragraph L deals with the duration of a certification as the employee exclusive bargaining representative and paragraph M involves decertification petitions. Although an exclusive bargaining representative enjoys certain rights under the Executive Order, 8 i.e., (1) [ejntitled to speak on behalf of all employees in the unit and shall be responsible for representing the interests of all such employees without discrimination and without regard to employee organization membership; (2) [ejxclusively permitted to have organizational membership dues collected by payroll deduction upon signed written request of employee conforming to law; except that any other organization that qualifies for payroll deduction of dues pursuant to § 6-402 of the State Personnel Article of the Annotated Code of Maryland shall continue to be eligible to receive payroll deduction of dues for as long as it remains so qualified; and (3) [ejntitled to meet and negotiate with the Governor or the Governor’s designee on wages, hours, and working conditions in an effort to reach an agreement subject to the approval of the Governor, ¶ 0, minority rights were not ignored. In addition to the proviso in paragraph 0(2), paragraph N of the Order provides: ²⁸⁰ Certification of an employee exclusive bargaining representative shall not preclude any employee or group of employees, regardless of employee organization membership, from bringing matters of personal concern to the attention of appropriate officials with a representative of his/her own choosing in a grievance proceeding held pursuant to a memorandum of understanding. Moreover, certain actions are proscribed by managerial and supervisory employees, “to the fullest extent permitted by law:” (1) [interfering with, restraining, or coercing Executive Branch employees in the exercise of rights granted by th[e] Order; (2) [interfering with, restraining, or coercing an Executive Branch employee with respect to selecting a representative for purposes of negotiating collectively or adjustment of grievances; (3) [Refusing to bargain collectively with the employee exclusive bargaining representative as required in th[e] Order; or (4) [rjefusing to negotiate in good faith or to execute or implement any memorandum of understanding negotiated pursuant to th[e] Order.

HP. Paragraph R addresses the revocation or amendment of the Order, simply stating that “[t]his Order may be revoked or amended by the Governor at any time.” Finally, the Order makes clear that “[t]he provisions of this Order shall in no way diminish or infringe any rights, responsibilities, power or duties conferred by the Constitution of the State of Maryland and the Annotated Code of Maryland.” ¶ S. Champe C. McCulloch, Donald P. Hutchinson, and John R. Tydings, the appellants, 9 as resident taxpayers of Maryland, ²⁸¹ filed a Complaint and Request for Declaratory and Injunctive Relief in the Circuit Court for Anne Arundel County, seeking to prevent the implementation of Executive Order No 01.01.1996.13. Naming as defendants Governor Parris N. Glendening and Eugene A. Confie, Jr, Secretary of the Maryland Department of Labor, Licensing and Regulation (“the appellees”), the appellants alleged that the Order is invalid and unconstitutional because (1) it violates the separation of powers doctrine and exceeds the statutory powers of the Governor; and (2) it conflicts with the Maryland General Assembly’s repeated rejection of similar collective bargaining bills and the Assembly’s enactment of the State Personnel Management System Reform Act of 1996, Md.Code (1996, 1997 RepLVol.) §§ 3-101 to 3-107 of the State Pers. & Pens. Article.

Cross motions for summary judgment having been filed, the circuit court, after conducting a hearing on the motions, issued a Memorandum and Order declaring the rights of the parties and upholding the validity of the Executive Order. Following the appellants’ timely appeal to the Court of Special Appeals, on our own motion and before that court considered the matter, we issued the writ of certiorari to address the important issues raised. We shall affirm the judgment of the circuit court. I. The circuit court found that “Executive Order 01.01.1996.13 meets Maryland constitutional and statutory requirements and is not in violation of the separation of powers.” The court also rejected the appellants’ argument that the Legislature’s failure to pass comprehensive collective bargaining legislation either preempted the Order or somehow precluded its issuance.

Moreover, finding that the Order is a valid exercise of the Governor’s broad authority to supervise and direct Executive Branch employees, the court concluded as well that the ²⁸² Order did not impose any limits on the. Governor’s or the General Assembly’s ability to carry out their functions. On this appeal, the appellants maintain the same themes they asserted in the trial court. They present in this Court four arguments which they maintain require reversal of the judgment below: First, the Executive Order collides impermissibly with both the Personnel Reform Act of 1996, in which the General Assembly expressly adopted a contrary approach to employee relations, and also with the direct legislative defeats of similar statewide initiatives over more than 50 years.

Second, the Order exceeds the Governor’s limited power to issue executive orders and otherwise establish State personnel policy. Third and Fourth, the Order violates Maryland’s constitutional separation of powers doctrine because it imposes both an “exclusive” and “binding” system of collective bargaining upon the State and its employees without prior legislative authorization. Not surprisingly, the appellees take the contrary view. Finding no flaw in the decision of the circuit court, or the reasoning underlying it, they urge this Court to affirm that judgment.

II

(a) Appellants argue, quoting Crane v. Meginnis, 1 G. & J. 463, 477 (1829), that the separation of powers doctrine creates a sharp demarcation in the lines of authority of government, and it “confine[s] in practice the action of each department to its own appropriate sphere, by forbidding to it the use of powers allotted to the co-ordinate departments.” Hence, they insist that, by issuing the Executive Order “absent express legislative authority” and in spite of numerous legislative defeats of similar initiatives, the Governor effectively usurped the law-making power of the Legislature. The Governor’s executive power is expressly provided in the Maryland Constitution. It can be found in two sections, namely, Article II, § 1, which vests the executive power of the ²⁸³ State in the Governor, and Article II, § 9, which directs the Governor to take care that the laws are faithfully executed. As the Chief Executive of State government, the Governor is responsible for the execution of the laws of Maryland.

Md. Const. Art. II, § 1; Bradshaw v. Lankford, 73 Md. 428 , 21 A. 66 (1891). The separation of powers doctrine is found in Article 8 of the Declaration of Rights of the Constitution of Maryland. It provides: [T]he Legislative, Executive and Judicial powers of Government ought to be forever separate and distinct from each other; and no person exercising the functions of one said Departments shall assume or discharge the duties of any other.

Despite its language, the doctrine has never been so rigidly applied, certainly not to the point of creating the sharp demarcation that the appellants envision. To the contrary, this Court has quite recently stated that it has “repeatedly pointed out that Art. 8 of the Maryland Declaration of Rights does not impose ‘a complete separation between the branches of government.’ ” Judy v. Schaefer, 331 Md. 239, 261 , 627 A.2d 1039, 1050 (1993)(quoting Dep’t of Trans, v. Armacost, 311 Md. 64, 81 , 532 A.2d 1056, 1064 (1987)). Indeed, rooted in the belief that “separating the functions of government and assigning the execution of those functions to different branches was fundamental to good government and the preservation of civil liberties,” Armacost, 311 Md. at 78 , 532 A.2d at 1062 , its purpose, therefore, is to “preserve[ ] to the one branch of government its essential functions and prohibits any other branch from interfering with or usurping those functions,” O’Hara v. Kovens, 92 Md.App. 9, 22-23 , 606 A.2d 286, 292 , cert. denied, 328 Md. 93 , 612 A.2d 1316 (1992), not, as argued by appellants, to create clear lines of “demarcation.” Since the beginning of our constitutional democracy, this Court has recognized that the respective powers of the legislative, executive and judicial branches of government are not “wholly ²⁸⁴ separate and unmixed.” Crane, 1 G. & J. at 476 10 ; see also Christ v. Dep’t of Nat. Resources, 335 Md. 427, 441 , 644 A.2d 34, 40 (1994); Baltimore v. State, 15 Md. 376, 459 (1860) (“The words of the Article appear to be plain enough, but they have not been accepted in their literal sense.”); Dep’t of Nat.

Res. v. Linchester, 274 Md. 211, 220 , 334 A.2d 514, 521 (1975)(“the separation of powers concept may constitutionally encompass a sensible degree of elasticity”); 1 F. Cooper, State Administrative Law, at 15 (1965)(“the doctrine of separation of powers does not forbid the exercise by one department of powers that could appropriately be exercised by another department ... there may be a ‘blending’ of disparate powers”). Thus, the separation of powers doctrine does not require absolute separation between the branches of government. See generally Baltimore, 15 Md. at 459 (“entire practical separation was not designed”). Contrary to the suggestion by the appellants that the subject of the Executive Order is one resting solely and exclusively within the purview of the legislative branch, and without in any way denigrating the legislative prerogative in this area, the Executive has a significant role in setting policies to govern the management and supervision of State employees; the Governor has broad discretionary powers granted him both by the Constitution, as we have seen, and by statute.

Entirely consistent with, and complementary of the Governor’s executive power under Article II, § 1, the General Assembly has, through enactment of Md.Code (1957, 1995 Repl.Vol.) § 3-302 of the State Govt. Article, entrusted to the Governor the power to establish personnel policies and to ²⁸⁵ require executive agency heads to carry out those policies. Reminiscent of Article II, § 1, § 8-802 declares, “[t]he Governor is the head of the Executive Branch of State government and, except as otherwise provided by law, shall supervise and direct the officers and units in that Branch.” See Md.Code (1996, 1997 Repl.Vol.) § 2-201 of the State Pers. & Pens. Article (“an employee in the Judicial, Legislature, or Executive Branch of State government is governed by the laws and personnel procedures applicable in that Branch”).

In addition, the Legislature has authorized the Governor to issue executive orders that (1) proclaims or ends a state emergency, under Article 41, § 2-101 of the Code; (2) adopts guidelines, rules of conduct, or rules of procedure for: (i) State employees; (ii) units of the State government; or (iii) persons who are under the jurisdiction of those employees or units or who deal with them; (3) establishes a unit, including an advisory unit, study unit, or task force; or (4) changes the organization of the Executive Branch of the State government. 11 ²⁸⁶ Md. Code (1957, 1995 Repl.Vol.) § 3-401, State Govt. Article. Given the breadth of the authority that the Legislature has bestowed on the Governor in § 3-302 and § 3-401(2), (3) and (4), a strong argument can be made, as the appellees have done, that the Executive Order can be upheld on the statutes alone. In any event, when the statutory and constitutional provisions are considered together, it becomes crystalline that the Governor has broad power and authority over Executive Branch employees and their working conditions.

We made just that point in Maryland Classified Empl. Ass’n v. Schaefer, 325 Md. 19, 34 , 599 A.2d 91, 98 (1991), cert. denied, 502 U.S. 1090 , 112 S.Ct. 1160 , 117 L.Ed.2d 407 (1992). At issue in that case was the validity of an Executive Order that increased the work week of most State employees from 35% to 40 hours without additional compensation. The Governor’s reasoned that a “standardized ’40 hour work week for State government [would] achieve cost containment through increased productivity and employee development.’ ” Id. at 22, 599 A.2d at 92 .

To achieve that end, the Governor directed the Secretary of Personnel and designated authorities to “take all actions necessary or desirable to implement” the Executive Order. Id. at 21 , 599 A.2d at 92 . The plaintiffs contended, inter alia, that the Governor’s promulgation of the Executive Order usurped the plenary power of the General Assembly and exercised a legislative function, which violated the separation of powers doctrine. Id. at 28 , 599 A.2d at 95 .

This Court rejected that argument, essentially the same one made here, observing: [T]he Governor, as head of the Executive Branch, has broad powers with respect to Executive Branch State employees and over the Secretary of Personnel, who exercises his power subject to the Governor and carries out the Governor’s policies with respect to personnel matters. Consequently, there is no foundation to the plaintiffs’ argument ²⁸⁷ that the Governor has no authority to fix normal work week by Executive Order. Id. Moreover, we adopted the trial court conclusion, “that the definition of an Executive Order in § 3-401 of the State Government Article was sufficiently broad ‘to allow the Governor to control and direct the officers over whom he is statutorily given control ... [including] the essential aspects of state employment such as hours in a work week.’ ” Id. at 29, 599 A.2d at 95 .

In this case, as we did in Schaefer, we agree with the trial court that “Executive Order .01.01.1996.13 meets Maryland constitutional and statutory requirements and is not in violation of the separation of powers.” The Governor’s broad authority, under Article 8 of the Maryland Declaration of Rights as well as sections 3-302 and 3-401 of the State Government Article, to issue executive orders for the guidance and direction of units and employees of the Executive Branch necessarily permits the promulgation of an executive order authorizing the limited collective-bargaining rights for Executive Branch employees contained in the subject Order. This act is an exercise of executive function, not a usurpation of legislative function. (b) Appellants’ second contention is that the Executive Order is invalid because it conflicts with the labor-management scheme adopted by the General Assembly in the enactment of the State Personnel Management Reform Act of 1996, §§ 3-101 to 3-107 of the State Pers. & Pens. Article.

Appellants argue that, while the Act “avoids both the collective-bargaining and the non-binding ‘labor-management partnership’ of meet and confer sessions with labor organizations,” the Executive Order mandates a process “requiring collective bargaining between management and union toward the execution of formal agreements on