Fairview School District v. Unemployment Compensation Board of Review

In Fairview School District v. Unemployment Compensation Board of Review, 499 Pa. 539, 454 A.2d 517 (1982), the Court addressed teacher eligibility for unemployment compensation benefits during a work stoppage. The union argued that the school district had changed the status quo because it failed to move personnel up a pay step under an expired contract. The school district argued that the stepped-up salary schedules in the expired contract applied to the specific years covered by the contract, and increases beyond those years were neither bargained for nor contemplated. The school district also argued that requiring step increases under the expired contract would undermine bargaining. Our Supreme Court concluded that the district's failure to pay stepped-up salaries in the interim period did not constitute a disruption in the status quo and, therefore, the teachers were not entitled to unemployment compensation benefits. Although the Court found for the school district, in doing so it opined: The underlying rationale for the status quo requirement is that during the interim period between contracts, the employer may continue operations and the employee may continue working, while the parties are free to negotiate on an equal basis in good faith. Maintenance of the status quo is merely another way of stating that the parties must continue the existing relationship in effect at the expiration of the old contract. To require the School District to pay stepped up salary increases beyond the specified years contained in the expired contract changes the existing relationship in the context of the terms and conditions subject to the very negotiations sought to be fostered. 499 Pa. at 546-47, 454 A.2d at 521. The Pennsylvania Supreme Court considered a public employer's discontinuation of salary increases after a contract has expired. There, the union and the school district informally agreed to extend the terms of an expiring collective bargaining agreement for 60 days while they negotiated a new contract. The teachers reported for work for the new school year after the old agreement expired. When they did so, they learned that their salaries had not included any step-up in pay to reflect their additional year of service. A work stoppage ensued. In order to determine the teachers' eligibility for unemployment benefits, the Supreme Court had to determine whether the work stoppage was a lockout by the district or a strike by the teachers. Stated another way, the dispositive issue was which party had upset the status quo. The Court held that the school district's refusal to pay stepped up salaries did not constitute a disruption of the status quo. Id. at 547, 454 A.2d at 521. The Court reasoned: The underlying rationale for the status quo requirement is that during the interim period between contracts, the employer may continue operations and the employee may continue working, while the parties are free to negotiate on an equal basis in good faith. Maintenance of the status quo is merely another way of stating that the parties must continue the existing relationship in effect at the expiration of the old contract. To require the School District to pay stepped up salary increases beyond the specified years contained in the expired contract changes the existing relationship in the context of the terms and conditions subject to the very negotiations sought to be fostered. Id. at 546-547, 454 A.2d at 521.