California Court of Appeal Protects Union Bargaining Rights When Public Employers Outsource Bargaining Unit Work
Public-sector labor agreements often contain management rights clauses. Public employers sometimes read those clauses broadly, especially when they want flexibility to reorganize operations, transfer functions, or contract work to outside vendors. But a recent published decision from the California Court of Appeal is a useful reminder that statutory bargaining rights are not lightly waived.
In Los Angeles County Professional Peace Officers Association v. County of Los Angeles, the Court of Appeal held that Los Angeles County failed to prove the union had “clearly and unmistakably” waived its right to meet and confer before the County outsourced security officer work to a private contractor. The court reversed the trial court’s judgment and ordered the County to meet and confer over the outsourcing decision.
The Dispute Started With County Security Officer Work
The Los Angeles County Professional Peace Officers Association, commonly referred to as PPOA, represents employees in County Bargaining Unit 621, including County-employed security officers. PPOA and the County were parties to a memorandum of understanding governing the terms and conditions of employment for those represented employees.
The dispute arose after PPOA learned in May 2021 that the County intended to contract with a private company to perform security work at the Kenneth Hahn Hall of Administration. PPOA requested to meet and confer over that decision. The County refused to bargain over the decision itself, but offered to bargain over the “effects” of the decision.
That distinction is important in public-sector labor law. Sometimes an employer’s underlying decision is not negotiable, but the employer still must bargain over the effects or impacts of the decision on represented employees. Here, however, PPOA argued the outsourcing decision itself was subject to bargaining because it involved transferring bargaining unit work to an outside contractor.
The MOU Language at Issue
The County relied on Article 16 of the Memorandum of Understanding, or MOU, titled “Employee Rights in the Event of Transfer of Functions.” That article addressed what would happen if the County entered into an agreement with another public employer or private entity involving the transfer of functions being performed by bargaining unit employees. Among other things, the County agreed to advise the outside entity of the MOU, notify PPOA of the agreement or applicable law, and meet with PPOA within five days after a department’s request for proposal was approved by the Chief Executive Officer.
Article 16 also stated that when advance knowledge was available concerning changes in function, organization, or operations resulting in the abolishment of positions, management would make an intensive effort to reassign, transfer, or train affected employees for other positions. The final sentence stated: “It is understood and agreed that Management shall have no obligation to negotiate the decision of any reorganization by the County during the life of this agreement.”
The County’s argument was straightforward: outsourcing security work was a “reorganization,” and PPOA had agreed the County had no obligation to negotiate reorganization decisions. PPOA disagreed, arguing the MOU did not expressly waive the union’s statutory right to bargain over contracting out bargaining unit work.
ERCOM and the Trial Court Sided With the County
PPOA filed an unfair practice charge with the Los Angeles County Employee Relations Commission, known as ERCOM. PPOA alleged the County violated its statutory duty to meet and confer under the Meyers-Milias-Brown Act, or MMBA.
The ERCOM hearing officer agreed the County had a duty to bargain over the outsourcing decision, but concluded PPOA had waived that right through Article 16. ERCOM ultimately adopted the hearing officer’s recommendation and dismissed PPOA’s unfair practice charge.
PPOA then filed a petition for writ of mandate in superior court. The trial court also sided with the County. It reasoned the word “reorganization” was broad enough to include transferring bargaining unit work to an outside contractor, especially given the broader context of Article 16. The trial court entered judgment for the County, and PPOA appealed.
The Court of Appeal Reversed
The Court of Appeal reversed. The key point was not whether the County had some general managerial authority to organize its operations. The key point was whether PPOA had clearly and unmistakably waived its statutory right to bargain over outsourcing bargaining unit work.
The court began with settled MMBA principles. Public agencies have a duty to meet and confer in good faith with recognized employee organizations over matters within the scope of representation, including wages, hours, and other terms and conditions of employment. The court also emphasized longstanding California law holding that the permanent transfer of bargaining unit work to an independent contractor is subject to mandatory bargaining when the transfer adversely affects the bargaining unit.
The County therefore needed to prove waiver. And because the right at issue was statutory, the waiver had to be “clear and unmistakable.” The Court of Appeal held the County did not meet that burden.
Notice Language Was Not the Same as a Bargaining Waiver
The court acknowledged Article 16 discussed outsourcing-related topics. It referred to agreements with public employers or private entities involving the transfer of functions performed by bargaining unit employees. It required notice to PPOA. It also required the County’s Labor Relations Office to meet with PPOA representatives within five days after approval of a request for proposal.
But the court found those provisions did not expressly address PPOA’s bargaining rights. Notice to a union is not the same thing as a waiver of the right to bargain. The MOU did not say PPOA waived the right to meet and confer over outsourcing decisions. Nor did the notice provisions conflict with the ordinary statutory meet-and-confer process.
That reasoning is important for labor organizations. A contract provision acknowledging that management may notify a union about a transfer of work, request for proposal, or other operational step does not necessarily mean the union has given up the right to bargain over the decision. The waiver must be specific enough to show the union actually gave up the statutory right at issue.
The Management Rights Clause Was Too Vague
The County’s strongest argument was the final sentence of Article 16, which said management had no obligation to negotiate “the decision of any reorganization.” The County argued outsourcing was a form of reorganization. The Court of Appeal rejected that argument.
The court held the phrase “any reorganization” was vague and ambiguous as applied to outsourcing bargaining unit work. The clause did not mention the MMBA. It did not mention the right to meet and confer. It did not mention contracting out or outsourcing bargaining unit work. The court concluded that language was not specific enough to waive PPOA’s statutory bargaining rights.
The court also explained general management rights clauses usually preserve preexisting management prerogatives. They do not ordinarily operate as waivers of statutory bargaining rights unless the language clearly says so. Because outsourcing bargaining unit work affects terms and conditions of employment, it is not treated as a free-standing management right immune from bargaining.
Why This Decision Is Important for Public Employees and Labor Organizations
This decision is significant for public employees and their unions because outsourcing is one of the most consequential decisions a public employer can make. Contracting out bargaining unit work can reduce available work, eliminate positions, weaken bargaining units, and shift public services to private employers whose workers may not have the same protections, compensation, seniority, or civil service rights.
The decision confirms that unions do not lose bargaining rights by implication. A public employer cannot rely on broad language, general management rights language, or a notice provision to avoid bargaining unless the agreement contains a clear and unmistakable waiver of the specific statutory right at issue.
For labor organizations, the case also underscores the importance of precise MOU drafting. If a union intends to preserve bargaining rights over outsourcing, contracting out, privatization, transfers of bargaining unit work, or requests for proposals, it should avoid language capable of being characterized as a broad waiver. If an employer proposes management rights language, the union should consider whether the language could later be argued to cover outsourcing decisions.
Why This Decision Also Matters for Public Employers
The case is also instructive for cities, counties, special districts, and other local public agencies. Public employers may have operational reasons for considering outside contracts. But when the decision involves transferring bargaining unit work to a private contractor, the agency should carefully evaluate whether the MMBA requires bargaining before the decision is finalized.
Offering effects bargaining may not be enough. If the decision itself is negotiable, the employer must meet and confer over the decision, not merely the consequences after the fact. A public employer relying on waiver should be prepared to identify MOU language expressly addressing the right being waived. General references to reorganization, transfer of functions, management rights, or notice may not satisfy the clear-and-unmistakable standard.
The Bottom Line
The Court of Appeal reversed the trial court’s judgment and directed the superior court to issue a writ of mandate requiring the County to meet and confer regarding its decision to transfer work from PPOA members to a private entity.
The practical lesson is direct: public-sector unions retain their statutory bargaining rights unless they clearly and unmistakably waive them. When a public employer seeks to outsource bargaining unit work, broad management rights language may not be enough. The question is whether the union unmistakably agreed to give up the right to bargain over that specific decision. In this case, the Court of Appeal held PPOA did not.
Los Angeles County Professional Peace Officers Association v. County of Los Angeles was filed on March 13, 2026, and certified for publication on April 10, 2026, by the California Court of Appeal, Second Appellate District, Division Seven, Case No. B338182. The judgment was reversed and the case was remanded with directions to issue a writ of mandate requiring the County to meet and confer regarding its decision to transfer PPOA bargaining unit work to a private entity.