For Release July 30

SD Supreme Court Orders Board of Regents to Negotiate with Faculty Union

PIERRE—The South Dakota Supreme Court today ruled that language in the state’s appropriation bill giving the Board of Regents authority to distribute salary increases without bargaining with the faculty union is inappropriate. The Regents, acting on that grant of authority from the South Dakota Legislature, had approved guidelines for distribution of salary increases for faculty and administrators based upon high priority academic programs, individual employee performance, and market information. The faculty union, the Council on Higher Education (COHE), sued the Regents, claiming that the action violated its right to bargain collectively. COHE also claimed that the Legislature acted unconstitutionally when it authorized the Regents to distribute salary increases without regard for the laws that permit public employees to bargain as a union.

"The Regents have studied the salary issue for some time. This last session we worked closely with the Legislature to shape and implement the plan for salaries. The state’s policy makers joined with the Regents in developing a strategy for addressing critical needs of the state’s faculty. The Regents have promulgated guidelines that would ensure the funds go to those who meet the criteria. Of course, we want this issue settled quickly," said Regents Executive Director Robert T. Tad Perry. "We know of instances where our employees cannot commit to major expenses, such as buying houses, without assurances of compensation for this next year. This is not just some legal wrangling. It impacts real people," Perry added. "We need to address the salary issue immediately. The court case has already delayed salary increases for employees by one month."

"The Supreme Court’s decision today prohibits the distribution of the salary increases until COHE has full opportunity to negotiate the package," said Regents President James O. Hansen. "Naturally, we are disappointed that we are prevented from awarding raises to those people who merit them, based on their performance and service to our universities and our students. The Regents are willing to meet with the union daily, but we see no reason to abandon our plans not to award across-the-board increases. Clearly, the Legislature did not want us to give all faculty the same increase. We made a compact with the students to reward those faculty who provide them with the best educational opportunities. We would be breaking faith with them if we don’t stand our ground," Hansen added.

In May at the Regents’ regular business meeting on the campus of South Dakota State University, Student Federation President Lance Russell had submitted a resolution from the federation declaring support for the Board’s action on salaries. Russell said at that time that the students agreed to increases in their costs on the condition that the additional revenues were used for merit pay for the faculty.

In December 1997 the Regents adopted a salary competitiveness plan that proposes to raise revenues for salaries of faculty and staff, who are exempt from the Career Service Act, by more than 10 percent per year for the next three years. In FY98 faculty salaries trailed neighboring states by 16.62%, while exempt employees trailed by 21.32%.

To pay for the package, the Regents cut full-time equivalent positions, increased student fees, and increased user fees in limited areas. In addition, the Legislature allowed the universities to retain some funds that would otherwise have been cut from the Regents’ budget, provided that the funds would be directed to the salary plan.

In the FY99 general appropriation bill, the Legislature directed the Regents to distribute salary increases without regard for state collective bargaining statutes. COHE obtained a writ of prohibition in May to prevent the Regents from distributing those increases. "COHE also challenged the action of the Legislature, saying that it should not have placed language in the appropriations bill to limit the collective bargaining laws. COHE said that the state’s budget is supposed to be the only subject in the general appropriations bill and that the provision granting the Regents discretionary authority should have been in a separate bill. Evidently, the Supreme Court agreed with them," said Perry.

Career Service Act employees are not affected by the salary competitiveness plan or the decision in the COHE lawsuit. They received the three-percent raise granted by the Legislature to all state employees. CSA employees also qualify for the below mid-point salary adjustments that have been granted to state employees since FY90.

COHE and the Regents had previously worked under a multi-year agreement that had expired at the end of FY96. Since that time the two have continued to bargain collectively. For FY97, negotiations reached impasse in the spring of 1997, preventing salary increases from being distributed for months after the beginning of that fiscal year. A limited agreement was reached for the distribution of salary increases for FY98. "The position of the Board of Regents is that the limited agreement was not intended to apply to moneys appropriated for salary increases in FY99," said Regents general counsel James Shekleton.

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