Michigan's collective bargaining law needs fixing

January 3, 2026

Michigan's Public Employment Relations Act (PERA) (Act 336 of 1947 as amended) is not sacred. It needs to be changed to make sure collective bargaining doesn't interfere with the democratic process. It needs to say that a collective bargaining agreement that increases costs or that changes a city ordinance is not final until approved by the city council. Further, the council's approval must come after a public hearing. In other words, the city council may reject a collective bargaining agreement, even if reached in a good faith negotiation.

Former attorney general Frank Kelley recognized the problem of law-making in a bargaining session.  In an August 31, 1984 opinion (#6244), Kelley wrote that “public employers and their affected employees [have] the right to, in effect, negotiate a statute out of existence . . . through collective bargaining.” He went on to say "Notwithstanding my concern in this regard, [my opinion is] constrained by the Supreme Court's consistent holdings with respect to the dominance of PERA in the public employment sphere. The continuation of such predominance is a question for legislative consideration." (emphasis mine)

The issue drew attention in East Lansing recently when changes in a new contract between the city and the police union put limits on the powers of the city's Independent Police Oversight Commission (ELIPOC) (see my story). The latest is that ELIPOC members are no longer allowed to use police department employees’ names at meetings or in reports. (source) Ridiculous.

The Public Employment Relations Act even had a part in Lansing's early retirement scandal of 1992, in which 144 city employees retired with jacked-up pensions and generous health insurance. A January 11, 1993 State Journal story said

 

....when the council tried to put off the entire deal, it was told that would be an unfair labor practice, because the Teamsters had negotiated in good faith.        [Councilwoman Ellen] Beal says now that the whole thing should have been given more consideration.        The council discussed the plan in two private meetings before voting on it. Michigan Open Meetings laws allowed the closed meetings because the topic related to union negotiations....        Council members were told not to discuss the plan with anyone and any notes they took were collected after each meeting...

Section 15 (1) of PERA needs a few tweaks to put the people - through their elected representatives - back in charge:

 

Sec. 15. (1) A public employer shall bargain collectively with the representatives of its employees as described in section 11 and may make and enter into tentative collective bargaining agreements with those representatives. Except as otherwise provided in this section, for the purposes of this section, to bargain collectively is to perform the mutual obligation of the employer and the representative of the employees to meet at reasonable times and confer in good faith with respect to wages, hours, and other terms and conditions of employment, or to negotiate an agreement, or any question arising under the agreement, and to execute a tentative written contract, ordinance, or resolution incorporating any agreement reached if requested by either party, but this obligation does not compel either party to agree to a proposal or make a concession. Any such contract, ordinance, or resolution remains tentative until a public hearing is held and the employer ratifies the agreement.

Unions aren't going to like it when they get a favorable agreement in a collective bargaining session then find out it doesn't mean anything unless the employer's governing body approves. It didn't take long after PERA - which mandated collective bargaining - was enacted in 1947 that unions realized that it didn't guarantee that they would get what they wanted. The Act didn't require that an agreement be reached. So unions - especially public safety unions - used other tactics to put the pressure on, such as "'job actions,' 'blue flu,' and 'work to rule'". That led to the passage of Act 312, which provided compulsory arbitration for public safety workers. (history here)

Act 312 cannot be fixed. In providing for compulsory arbitration for public safety workers it, allows an arbitrator appointed by the Michigan Employment Relations Commission (MERC) to make the final determination in disputes over wages and other economic issues, and it does so by choosing between the last offer from each party.

Even though arbitrators must be qualified and undergo training, they still make bad decisions. I have two examples:

1. The first is the East Lansing case mentioned above. From Ayah Imran's story in East Lansing Info:

 

The reason the city did not believe ELIPOC was not an issue appropriate for arbitration is Section 8 of the Act, which specifies "economic" issues, not just "issues", although it does say the arbitration panel decides whether an issue is "economic".:

In this case, the arbitrator made a bad decision. There was no way ELIPOC was an economic issue. We don't know if his error was due to incompetence or politics. Today's MERC is, after all, part of a Democratic administration.

2. My second example of a bad decision coming out of arbitration is from 30 years ago. It was between the Ingham County Sheriff and the sheriff supervisors, represented by the Fraternal Order of Police. I wrote a story about it in 2016. In August 1996, the FOP petitioned MERC for binding arbitration on several matters, one of which was pensions. The FOP wanted to increase the pension multiplier from 2.5% to 3.2%. The union promised to pay the full cost as determined by the actuary, increasing the member contribution from 10.5% to a whopping 19.61%.

The arbitrator ruled in favor of the union, but what nobody anticipated was that eight members of the 30-member sheriff supervisor unit would take advantage of those enhanced retirement benefits without helping pay for them. They retired within one year, as soon as they were eligible after the October 1, 1997 effective date of the new contract.

 

Increasing the pension multiplier from 2.5% to 3.2% was a big jump. For a retiree with a $60,000 FAC, the pension went from $37,500 to $48,000, an increase of $10,500 a year. A 50 year old male can expect to live to age 82, another 32 years. (life expectancy calculator) At $10,500 a year, the increase alone would cost the County $336,000 per retiree. And some of them retired as young as 45. (They could retire at any age with 25 years of service.) One of them - Tom Reich, who is now Eaton County sheriff - went to work as an Ingham sheriff deputy the same year he graduated from high school.

It is not just that MERC arbitrators make dumb/political decisions. MERC - the state - should not be interfering at all. All decisions regarding the compensation of local government employees should be made by the elected representatives of that government. That is democracy.

Act 312 is irredeemable. It should be repealed.

Send comments, questions, and tips to stevenrharry@gmail.com or call or text me at 517-730-2638. If you'd like to be notified by email when I post a new story, let me know.