Executive Orders vs. De Facto Legislation; In-Home Personal Care Workers and Collective Bargaining

Markham v. Wolf, 147 A.3d 1259 (Pa. Cmwlth. 2016), 109 MAP 2016 (Direct appeal); Smith v. Wolf, 110 MAP 2016 (companion case, identical issues)

In these related cases Governor Wolf appeals from the Commonwealth Court’s orders declaring invalid and enjoining major portions of his Executive Order 2015-05, which focuses on individuals who receive, and direct care workers (DCWs) who provide, in-home personal care to help disabled and elderly Pennsylvanians live in their homes, rather than in nursing homes pursuant to the Attendant Care Services Act, 62 P.S. §§ 3051-3058 (Act 150), and federal Medicaid waiver programs.

The petitioners in the Commonwealth Court alleged that the Executive Order interferes with the participant-DCW employment relationship under Act 150, and is de facto legislation that establishes organizational labor rights for DCWs, exceeding executive authority because it creates rights inconsistent with existing labor laws. The Governor and the Department of Human Services (Department) responded that the Executive Order is merely a tool for the Department and the Governor to efficiently get information from those who provide important services to some of our most vulnerable Pennsylvanians with the ultimate goal of providing better services, that information gathering is its primary purpose, and that it is a valid exercise of Governor Wolf’s executive power.

The Department oversees home care services and administers the funding for Home Care Programs.  As the Commonwealth Court explained:

Under the Home Care Programs, DCWs provide personal care and domestic services to enable participants to live at home rather than in an institution. At times, a DCW is a participant’s relative, residing at the same address.

Home care services are directed either by participants, under the Participant Model, or by agencies under the Agency Model. Under the Participant Model, DCWs are recruited, hired, and managed by a participant who employs the DCW. By contrast, under the Agency Model, a home care agency recruits, hires and manages the DCW. As employers, participants have federal employer identification numbers, are subject to workers’ compensation and unemployment requirements, and pay relevant employer taxes. Under Act 150, participants have the “right to make decisions about, direct the provision of and control … [home] care services.” Section 2(3) of Act 150, 62 P.S. § 3052(3). Thus, participants’ control over their care is unfettered other than compliance with home care service regulations. … The Executive Order governs the relationship between DCWs and the Department. As such, it pertains only to the Participant Model.

Slip Op., at 3-4.

The Executive Order establishes a policy-making body regarding the provision of home care. The Executive Order also allows DCWs to elect an employee organization with which the Department must meet and discuss certain issues. In so doing, the Executive Order empowers DCWs, who are non-Commonwealth employees, to negotiate with the Commonwealth through a newly created position of a DCW representative.  To aid the election process, on a monthly basis, the Department is required to compile a list of the names and addresses of all DCW workers (DCW List), who, within the three previous months, were paid through a Home Care Program that provides services under the Participant Model.

Section 2 of the Executive Order establishes an advisory group to advise the Governor and the Department on ways to improve the quality of care delivered through Home Care Programs. Section 3 creates a process for organizing the DCWs under an employee organization authorized to represent DCWs in their relations with the Commonwealth. Section 4 addresses the DCW List, to be used by a prospective employee organization in contacting DCWs. Section 5 includes provisions that refer to new relationships that may arise during the operation of the Section 3.

Using the analysis laid out in Shapp v. Butera, 22 Pa.Cmwlth. 229, 348 A.2d 910, 914 (1975) (en banc) concerning the proper scope of executive orders, the Commonwealth Court found that Sections 3 and 4 of the Executive Order, together with related provisions of the Order, are not permissible executive actions:

In Shapp, this Court outlined the confines of a Governor’s authority to issue executive orders. We classified executive orders into three types: (1) proclamations for a ceremonial purpose; (2) directives to subordinate officials for the execution of the duties of the Executive Branch of government; and, (3) implementation of a statute or other law. Only the third type of executive orders is legally enforceable.

Slip Op, at 22.

The court first rejected the Governor’s contention that Sections 3 and 4 of the Executive Order are permitted under the second category of orders, as a directive to subordinates.  The court reasoned that the Executive Order: creates new rights and mandatory duties for both executive subordinates and third parties; alters the employment relationship between DCWs and participants by inserting the Department and the DCW Representative into that relationship, with the goal of negotiating terms and conditions of employment without input by participants; and thereby goes well beyond the stated goal of information gathering.

The court then considered whether the Executive Order implemented a statute or other law, the third Shapp v. Butera criterion, and concluded that rather than implementing existing labor laws, it contradicts them.  The court noted that the Pennsylvania Labor Relations Act (PLRA) allows defined employees to collectively bargain through an exclusive representative, but that DCWs are expressly excluded from the definition of employee in Section 3 of the PLRA. Further, the court observed that, similarly, the Public Employees Relations Act (PERA), which grants public employees the right to unionize, does not confer collective bargaining rights on DCWs, who are not Commonwealth employees, and whose employers are participants who are private parties.

Declaring all but Section 2 and other the information-gathering elements of the Executive Order invalid and enjoining its enforcement, the court reasoned:

Governor Wolf exceeded his authority in issuing Sections 3 and 4 of the Executive Order. Most of the Executive Order does not merely implement or enforce existing law, so as to be authorized under the third category of executive orders in Shapp. Instead, the Executive Order is de facto legislation, with provisions contrary to the existing statutory scheme. … At its core, the Executive Order invades the relationship between a DCW and the employer participant who receives personal services in his or her home. For these and the above reasons, we declare Sections 3 and 4, and related Sections 1(d) and (e), and 5(b) through (g), of the Executive Order invalid.

Slip Op., at 34.

In his direct appeal from the Commonwealth Court’s orders, Governor Wolf argues that the Commonwealth Court erred because the Executive Order: (1) does not create legal rights and duties; (2) does not conflict with the participant-directed model for public home care programs; and (3) does not conflict with state statutes regulating labor relations. The Executive Order, the Governor argues, is based on a conclusion that there is a relationship between improving home care programs and improving the status of the direct care workforce. The Executive Order concludes that one way to improve home care policies that impact direct care workers is to obtain more stakeholder input by directing executive branch officials to periodically meet and confer with a representative chosen by direct care workers themselves. “The Executive Order is explicit that it does not extend collective bargaining rights to direct care workers or authorize collective bargaining agreements or take away any authority from home care recipients. It merely provides a formal process for dialogue between executive branch officials and a stakeholder group.”  Respondents’ Br. at 18.

For more information, contact Kevin McKeon or Dennis Whitaker.