Salera v. Caldwell. , 137 Haw. 409 ( 2016 )

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Electronically Filed
Supreme Court
SCAP-15-0000106
11 MAY-2016
08:33 AM
IN THE SUPREME COURT OF THE STATE OF HAWAIʻI
---o0o---
NARCIS D. SALERA; GLENN E. COMPANION; UNITED PUBLIC WORKERS,
AFSCME, LOCAL 646, AFL-CIO; JOHN DOES 1-10; AND JANE DOES 1-10,
Respondents/Plaintiffs-Appellees/Cross-Appellants,
vs.
KIRK W. CALDWELL, Mayor, City and County of Honolulu;
CAROLEE C. KUBO, Director, Department of Human Resources,
City and County of Honolulu; LORI M. K. KAHIKINA, Director,
Department of Environmental Services, City and County of
Honolulu; and CITY AND COUNTY OF HONOLULU,
Petitioners/Defendants-Appellants/Cross-Appellees,
and
JOHN DOES 1-10; JANE DOES 1-10; DOE CORPORATIONS 1-10; DOE
PARTNERSHIPS 1-10; ROE NON-PROFIT ORGANIZATIONS 1-10; AND ROE
GOVERNMENTAL ENTITIES 1-10 (2014-013),
Defendants.
SCAP-15-0000106
APPEAL FROM THE CIRCUIT COURT OF THE FIRST CIRCUIT
(CAAP-15-0000106; CIV. NO. 14-1-2655-12)
MAY 11, 2016
RECKTENWALD, C.J., NAKAYAMA, POLLACK, AND WILSON JJ., AND
CIRCUIT JUDGE GARIBALDI, IN PLACE OF McKENNA, J., RECUSED
OPINION OF THE COURT BY POLLACK, J.
This case concerns the decision of the Department of
Environmental Services of the City and County of Honolulu to
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discontinue frontloader collection services to 181 multi-unit
residential buildings and non-profit organizations. We address
whether the elimination of these government services is
prohibited by constitutional merit principles under Article XVI,
Section 1 of the Hawaiʻi Constitution and civil service statutes.
I. BACKGROUND
Frontloader collection services1 are part of the City
and County of Honolulu’s (City and County) solid waste
collection and disposal system, regulated pursuant to Hawaiʻi
Revised Statutes (HRS) § 340A (2010) and Chapter 9 of the
Revised Ordinances of the City and County of Honolulu (ROH).
The Department of Environmental Services (the Department) is the
county agency responsible for administering the collection and
disposal of refuse. HRS § 340A-3; ROH § 9-1.3(a) (1990).
In 1998, United Public Workers, AFSCME, Local 646,
AFL-CIO (collectively, UPW)2 and the City and County entered into
a Memorandum of Agreement in which the City and County agreed,
inter alia, to the following: (1) restore collection services on
1
“Frontloader collection service” is defined as “refuse collection
service using an owner-provided, three-cubic yard container which requires no
manual moving, no manual lifting by city personnel and is lifted over the
front of the collection vehicle.” ROH § 9-1.2 (1990).
2
UPW exclusively represents 8,364 blue collar non-supervisory
employees in bargaining unit 1, including thirteen refuse collection crew
leaders and refuse collectors on the City and County’s front-end loader work
crews.
2
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Oʻahu that had previously been privatized; and (2) expand
frontloader collection services to businesses, condominiums, and
churches. This agreement was enforced through proceedings
before the Hawaiʻi Labor Relations Board. Several appeals ensued
in which the Circuit Court of the First Circuit (circuit court)
ordered the City and County to cease and desist from repudiating
the agreement with UPW and honor in good faith the agreement’s
terms. After unsuccessfully appealing the circuit court’s order
to this court, the City and County restored frontloader refuse
collection services to multi-family properties and non-profit
organizations that had previously been privatized. For
approximately the last ten years, six front-end loader work
crews, consisting of refuse collection crew leaders and refuse
collectors from the Honolulu, Pearl City, and Kapaʻa baseyards,
have utilized seven front-end loader trucks to service 1,615
dumpsters twice a week for 181 multi-family residences and non-
profit properties as well as for 51 City agencies.3
In July 2014, following the City Council’s decision to
no longer provide funds for the procurement of front-end loader
collection vehicles, the Department’s Director Lori Kahikina
3
Respondent Narcis Salera is a refuse collection crew leader who
has been employed as a civil servant since November 29, 2006 to provide
refuse collection services on Oʻahu. Respondent Glenn Companion is a refuse
collector who has been employed as a civil servant since July 1, 2007 to
provide similar services.
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decided to discontinue frontloader collection services to the
181 multi-unit residential properties and non-profit
organizations, effective January 31, 2015. The Department sent
notices to the affected properties, which included a list of
contact information for fourteen private haulers who potentially
might be able to provide refuse collection services. The 181
entities were urged to “make arrangements with a private refuse
hauling company for [replacement] service[s]” and were asked to
inform the City and County if they intended to “shift to private
hauling services sooner than January 31, 2015.”
The Department also advised UPW by letter regarding
the discontinuance of the frontloader collection services to the
181 properties. The Department cited to the “unfair
distribution of city service[s] and resources” and “diminishing
resources,” including “insufficient equipment to continue the
service[s] and no prospects of being able to acquire additional
equipment,” as reasons for discontinuing frontloader collection
services. Additionally, the Department reassured UPW that
“[a]ll employees will retain their current positions and yard
assignments, and will continue to perform work in accordance
with their position descriptions. Front loader service will
continue to be provided to approximately 50 City agency
facilities.”
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In a responsive letter, UPW objected to the decision
to end frontloader collection services, stating that the
Department’s “unilateral decision” violates “the duty to
negotiate and to obtain mutual consent” pursuant to various
agreements. UPW maintained that the City and County had not
negotiated any modifications to the mutual agreement to restore
and expand refuse collection services. Accordingly, UPW
requested negotiations and asked the City and County to cease
and desist from discontinuing frontloader refuse collection
services and to suspend notification of the cancellation of
these services pending negotiations. UPW also sought responses
to an information request included in its letter.
In its reply to UPW’s information request, the
Department recognized that there were some monetary savings to
ending this government service but cited “general equity and
non-monetary concerns” as the primary reasons for its decision
to discontinue frontloader refuse collection services. In a
subsequent letter to UPW, the City and County indicated, inter
alia, that “any impact will be nominal, as all employees will
continue their employment and will continue to be based at their
existing baseyard. Impacted employees’ rate of pay and benefits
will remain the same, and their scope of work remain as manual
collection.” The City and County declined to rescind any
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notices of the discontinuation of refuse collection services to
the affected properties.
Of the 181 properties, 116 entered into contracts with
private licensed collectors. One of the licensed collectors had
at least 41 locations with pending contracts while another had
at least 63 pending contracts.
A. Complaint
On December 31, 2014, Narcis Salera, Glenn Companion,
and UPW (collectively, the Union) sued the City and County of
Honolulu, Mayor Kirk W. Caldwell, Human Resources Director
Carolee C. Kubo, and Director Kahikina (collectively, the City)
in circuit court. The Complaint stated four claims: (1) a
violation of constitutional merit principles under Article XVI,
Section 1 of the Hawaiʻi Constitution (count 1); (2) a violation
of civil service laws pursuant to HRS § 46-33 (count 2); (3) a
violation of the right to collective bargaining under Article
XIII, Section 2 of the Hawaiʻi Constitution (count 3); and (4) a
violation of public policy and ultra vires contrary to the
judgment entered in Civil Nos. 03-1-0546-03 and 03-1-0552-03
(count 4). The Union provided the 181 affected entities with a
copy of the Complaint.
B. Injunction Order
On January 13, 2015, the Union filed a motion for a
temporary restraining order and a preliminary injunction
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(Injunction Motion) seeking to enjoin the City from unilaterally
implementing the privatization of the frontloader collection and
disposal services at issue. The City opposed the motion,
contending that its decision to discontinue frontloader
collection services did not constitute impermissible
privatization but was instead a non-justiciable political
question. A notice of the Injunction Motion and hearing was
sent to the 181 properties and non-profit organizations. The
circuit court granted the Union’s Injunction Motion by written
order entered on January 30, 2015 (Injunction Order), concluding
that the Union demonstrated a strong probability of success on
the merits of the alleged violations of merit principles (counts
1 and 2).
The circuit court found that for approximately the
last ten years, the City and County has provided refuse
collection services through the use of six front-end loader work
crews, consisting of refuse collection crew leaders and refuse
collectors, to service 1,615 dumpsters twice a week for the 181
properties and numerous City agencies. The court determined
that the refuse collection services for the 181 properties have
historically and customarily been performed by civil servants
employed by the City and County pursuant to HRS § 46-33 and the
merit principles under Article XVI, Section 1 of the Hawaiʻi
Constitution. Further, the court found that the City had not
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sought or obtained the required certifications or approvals
required to exempt the refuse collection services from the civil
service system and that there were no statutory exemptions that
apply to the positions or personal services in question.
The circuit court stated that the decision to
discontinue these services was made, inter alia, by Director
Kahikina and that “general equity and non-monetary concerns”
were the primary reasons for the decision. The court determined
that the City Council did not adopt an ordinance or resolution
to require the City and County to discontinue the public refuse
collection services to the 181 properties and that the civil
servants on front-end loader crews are available to provide
these services on or after January 31, 2015. The court found
that the City and County notified the 181 properties of its
intent to discontinue the frontloader collection services
effective January 31, 2015 and urged the owners to “make
arrangements with a private refuse hauling company for
(replacement) services.”
The circuit court also determined that the nature of
the services provided by the refuse collection crew leaders and
refuse collectors are “virtually identical” to the services
provided by private hauling companies’ truck drivers and
collectors. The court further determined that unless it granted
the injunction, then the City and County’s decision would
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“eliminate three (3) of the six (6) front end loader work crews,
reassign refuse collection crew leaders and refuse collectors to
new routes, and reduce the City’s frontloader collection
services by approximately 89 percent on January 31, 2015.”
Although frontloader collection services would continue for 51
City agencies, the court found that the City and County’s
decision to terminate these services to the 181 properties will
“directly impact at least 13 civil servants and result in
irreparable injury” to the Union. The court stated that there
was no evidence presented indicating that granting the
injunction would cause irreparable injury to the City.
The circuit court then examined the merit principles
under Article XVI, Section 1 of the Hawaiʻi Constitution and the
civil service laws at HRS §§ 76-77 and 46-33. To determine
whether privatization was involved, the court applied the nature
of services test set forth in Konno v. County of Hawaiʻi, 85
Hawaiʻi 61, 937 P.2d 397 (1997), which the court summarized as
follows: “services that have been customarily and historically
provided by civil servants cannot be privatized absent a showing
that civil servants cannot provide those services or that the
services are subject to a specific statutory exemption.” The
circuit court concluded that the City and County’s
“cancellation” of frontloader collection services was “in effect
a shift from government provision of functions and services to
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provision by the private sector” and thus constituted
impermissible privatization. The court further noted that it
was undisputed that the services provided by the civil service
employees would have been replaced by private businesses and
observed that the City and County contemplated this when it
decided to terminate the refuse collection services to the 181
properties.
Additionally, the court reasoned that the personal
services provided by the refuse collection crew leaders and
refuse collectors are within the civil service unless one of the
exemptions of HRS §§ 46-33 and 76-77 applies. Because the City
did not assert the applicability of an exemption and because no
exemptions apply, the court concluded that the front-end loader
work crew positions are within the civil service and thus
governed by Article XVI, Section 1 of the Hawaiʻi Constitution.
Accordingly, the court ruled that, based on the evidence
presented, the Union demonstrated a strong probability of
success on counts 1 and 2.
The circuit court rejected the City’s contention that
this case involves a non-justiciable political question. The
court reasoned that “as the privatization of the front end
loading services is a prohibitive practice which does not allow
for negotiations, only legislative action may alter the civil
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service statutes through statutory enactment.” The court
concluded that no such legislative statute had been enacted.
Finding that the Union established the required
elements for a temporary restraining order and preliminary
injunction, the circuit court granted the Union’s Injunction
Motion and enjoined the privatization of frontloader refuse
collection and disposal services to the 1,615 dumpsters at the
181 properties.
C. Motion for Partial Summary Judgment
The Union then filed a motion for partial summary
judgment on counts 1 and 2 and sought to make its temporary
injunction permanent. In opposition, the City argued that its
decision to end frontloader collection services did not involve
Konno privatization, did not violate any civil service laws, and
concerned a non-justiciable political question.4
The circuit court granted the Union’s motion for
partial summary judgment by written order entered on February
26, 2015 (Partial Summary Judgment Order), ruling that the Union
was entitled to final partial judgment as to counts 1 and 2.5
4
The City did not expressly raise any arguments related to the
joinder of necessary and indispensable parties under Hawaiʻi Rules of Civil
Procedure (HRCP) Rule 19 in its Memorandum in Opposition to the Injunction
Motion and Memorandum in Opposition to the Union’s motion for partial summary
judgment.
5
At the hearing on the motion for partial summary judgment, the
circuit court stated that it was granting the motion as to counts 1 and 2
(continued. . .)
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The court also permanently enjoined the City from discontinuing
public refuse collection and disposal services to the 181
properties.
The circuit court entered an order certifying the
Partial Summary Judgment Order for appeal (Certification Order),
which also stayed the proceedings as to counts 3 and 4. The
court determined that, pursuant to HRS § 641-1(b), the appellate
court’s affirmance of the circuit court’s ruling on counts 1 and
2 and the rejection of the political question argument would
moot the remaining claims, thereby leading to a “speedier
termination of litigation.” Additionally, based on the
reasoning that the interlocutory appeal could moot counts 3 and
4, the court stayed the proceedings as to counts 3 and 4,
pursuant to HRCP Rule 62(d) and (e), and also the proceedings
related to costs and fees under HRCP Rule 54(d). Over the
City’s objection, the circuit court certified the Union’s
request to appeal the Certification Order.
The City filed an appeal from the Partial Summary
Judgment Order, and the Union filed a cross-appeal from the
(. . .continued)
based on the court's “reasons on the issues previously given for the TRO as
well as the preliminary injunction.”
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Certification Order.6 On August 4, 2015, the case was
transferred to this court.
II. STANDARDS OF REVIEW
A. Summary Judgment
Appellate courts review an award of summary judgment
de novo under the same standard applied by the circuit court.
Thomas v. Kidani, 126 Hawaiʻi 125, 127-28, 267 P.3d 1230, 1232-33
(2011). This court articulated that standard as follows:
Summary judgment is appropriate if the pleadings,
depositions, answers to interrogatories, and admissions on
file, together with the affidavits, if any, show that there
is no genuine issue as to any material fact and that the
moving party is entitled to judgment as a matter of law.
Id. at 128, 267 P.3d at 1233 (quoting Fujimoto v. Au, 95 Hawaiʻi
116, 136, 19 P.3d 699, 719 (2001)). This court must review the
evidence and inferences in the light most favorable to the non-
moving party. Id. at 128, 267 P.3d at 1233.
B. Constitutional Law: Political Question Doctrine
The appellate court reviews questions of
constitutional law de novo under the right/wrong standard.
Onaka v. Onaka, 112 Hawaiʻi 374, 378, 146 P.3d 89, 93 (2006).
6
On June 29, 2015, the State of Hawaiʻi filed an amicus curiae
brief, supporting the City’s position that Konno does not extend to
situations where the government decides to eliminate services. On October
16, 2015, the County of Kauaʻi joined the State’s amicus curiae brief.
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III. DISCUSSION
On appeal, the City asserts that the circuit court
erred: (1) in concluding that the termination of frontloader
collection services to the 181 properties constituted
impermissible privatization; (2) in adjudicating political
questions related to legislative budget decision-making and the
executive branch’s decision to eliminate government services;
and (3) in enjoining and entering judgment against the City when
all interested and necessary parties, such as the 181 property
owners and private haulers who had already entered into
contracts, were not joined in the lawsuit where joinder was
feasible.7
7
The Union filed a cross-appeal, raising procedural issues related
to the Certification Order. The Union first contends that the appellate
court lacks jurisdiction because the circuit court erred in certifying the
appeal under HRS § 641-1(b), not HRCP Rule 54(b). However, the appeal was
not from a final judgment, and therefore HRS § 641-1(b) applied to the
interlocutory appeal of the Certification Order. Alternatively, the Union
maintains that the circuit court abused its discretion in determining that an
interlocutory appeal was advisable for the “speedy termination of litigation”
under HRS § 641-1(b). The circuit court concluded that if the appellate
court affirms its grant of partial summary judgment, then counts 3 and 4 will
be substantially, if not entirely, resolved. The circuit court’s
determination was therefore not an abuse of discretion.
The Union also asserts that the circuit court lacked any legal
basis for granting a stay of further proceedings as to counts 3 and 4.
Although the circuit court incorrectly cited HRCP Rule 62 in the
Certification Order, a court has inherent authority to stay proceedings
pending an interlocutory appeal. See HRS § 603-21.9 (1972); City & County of
Honolulu v. Ing, 100 Hawaiʻi 182, 193 n.16, 58 P.3d 1229, 1240 n.16 (2002)
(describing the court’s discretion and inherent power to stay proceedings).
Thus, the circuit court did not abuse its discretion in staying counts 3 and
4 because, as indicated by the court, the stay in this case may avoid
unnecessary litigation. Consequently, the February 26, 2015 Certification
Order is affirmed.
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Accordingly, the dispositive issue on appeal is
whether the City and County’s decision to terminate frontloader
refuse services to the 181 properties violated State
constitutional merit principles and civil service laws.8
A. Privatization Principles and Their Application to This
Case
It is well-recognized that the term “privatization”
encompasses a wide variety of activities. Konno v. County of
Hawaiʻi, 85 Hawaiʻi 61, 68, 937 P.2d 397, 404 (1997).
“Privatization [generally] refers to the shift from government
provision of functions and services to provision by the private
sector.” Id. (quoting George L. Priest, Introduction: The Aims
of Privatization, 6 Yale L. & Pol’y Rev. 1, 1 (1988)). There
8
The City also contends that the circuit court erred in failing to
rule on the issue of joinder of “necessary and indispensable” parties under
HRCP Rule 19(a). Because the City failed to timely raise the issue of
joinder, the City waived its HRCP Rule 19(a) defense. See Marvin v.
Pflueger, 127 Hawaiʻi 490, 502, 280 P.3d 88, 100 (2012) (indicating that the
failure to raise the lack of joinder of necessary parties under HRCP Rule
19(a) may be waived).
Even if the City had properly raised the issue of joinder, the
requirements of HRCP Rule 19(a) would not be satisfied. First, the private
haulers and 181 property owners and residents are not bound by the circuit
court’s decision in this case such that complete relief for the Union or the
City is not dependent on whether these non-parties participated in the
lawsuit. Second, none of the non-parties have claimed an interest relating
to the litigation, and any potential valid claim by the private haulers
against the City has not been compromised. Third, the disposition of this
case does not subject the City or the Union to “a substantial risk of
incurring double, multiple, or otherwise inconsistent obligations by reason
of” any claimed interest. See HRCP Rule 19(a). Consequently, even assuming
the City had properly raised the issue of joinder pursuant to HRCP Rule
19(a), the circuit court would not have been required to order joinder of the
private haulers and 181 entities.
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are many forms of privatization, including contracting out and
government service shedding. Donald G. Featherstun et al.,
State and Local Privatization: An Evolving Process, 30 Pub.
Cont. L.J. 643, 646-48 (2001).
Contracting out is defined as “the transfer by
governmental entities of responsibility for the performance of
desired functions, mostly of a personal service (i.e.
administrative) nature, to private institutions” or “the
replacement of members of [a] bargaining unit by the employees
of an independent contractor performing the same work under
similar conditions of employment.” Konno, 85 Hawaiʻi at 68, 937
P.2d at 404 (quoting Timothy P. Dowling, Note, Civil Service
Restrictions on Contracting Out by State Agencies, 55 Wash. L.
Rev. 419, 419 n.3 (1980)). Government service shedding occurs
when the government “simply decides to stop providing a certain
service or function, leaving it to the private sector to fill
the need if a demand exists.”9 Featherstun et al., supra, at
647.
9
For example, if a city decides to no longer provide bus
transportation to residents, “residents and potential entrepreneurs would
then be left to their own devices regarding the ability to travel in the
city.” Shirley L. Mays, Privatization of Municipal Services: A Contagion in
the Body Politic, 34 Duq. L. Rev. 41, 44-45 (1995). Thus, government
withdrawal from an activity or from responsibility for providing services in
this manner constitutes privatization. Id.
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In Konno, this court recognized that privatization
“involves two important, but potentially conflicting, policy
concerns.” Konno, 85 Hawaiʻi at 74, 937 P.2d at 410.
Privatization has the potential to increase the efficiency of
public services, but it can also undermine the policies behind
the civil service system, such as the “elimination of the spoils
system and the encouragement of openness, merit, and
independence.” Id. States have employed different approaches
to address the tension between privatization and the civil
service system. Id. at 69-70, 937 P.2d at 405-06. This court
adopted the nature of services test, id. at 72, 937 P.2d at 408,
which states that “services that have been ‘customarily and
historically provided by civil servants’ cannot be privatized,
absent a showing that civil servants cannot provide those
services.” Id. at 69, 937 P.2d at 405 (quoting Wash. Fed’n of
State Emps. v. Spokane Cmty. College, 585 P.2d 474, 477 (1978)).
Under this approach, civil service law protections extend to
services that have been customarily and historically provided by
civil servants, unless the services are subject to a statutory
exemption. Id. at 72, 937 P.2d at 408.
In concluding that the privatization effort at issue
in Konno violated constitutional merit principles and civil
service laws, this court emphasized that the Hawaiʻi Constitution
and State statutes “strongly support the policies underlying the
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civil service.” Id. at 75, 937 P.2d at 411. The court observed
that the significant public policies underlying the civil
service system necessitate careful consideration and regulation
of any privatization effort. Id. at 74, 937 P.2d at 410.
Indeed, the court noted that it is the legislature’s role to
make policy decisions in favor of privatization and that it
would be inappropriate for the courts to usurp that role. Id.
at 74-75, 937 P.2d at 410-11. That is, only a statute, not a
government official’s unilateral decision, may expressly
authorize the privatization of a public service. See id.
On appeal, the City contends that the circuit court
erred in concluding that the City and County’s decision to end
frontloader collection services to 181 multi-family residential
and non-profit properties constituted impermissible
privatization under Konno. The City argues that Konno is
factually and legally inapplicable because the termination of
frontloader collection services does not result in any shifting
of services from civil servants to private businesses. In its
amicus curiae brief, the State maintains that privatization
should only include situations where the government stops using
its employees and uses private employees, pursuant to government
contracts, to perform the same service.
However, the broad definition of privatization as the
“shift from government provision of functions and services to
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provision by the private sector,” id. at 68, 937 P.2d at 404
(quoting Priest, supra, at 1), encompasses the type of
privatization that is at issue in this case: government shedding
of service, or the situation when government decides to stop
providing certain services and leaves it to private entities to
fill the need. Featherstun et al., supra, at 647. While the
Department did not terminate all refuse collection services to
Oʻahu residents, private haulers are filling the demand for the
services that the City and County had previously provided to the
181 properties. Consequently, the circumstances of this case
constitute a form of contracting out set forth in Konno--“the
replacement of members of [a] bargaining unit by the employees
of an independent contractor performing the same work under
similar conditions of employment.” Konno, 85 Hawaiʻi at 68, 937
P.2d at 404 (quoting Dowling, supra, at 419 n.3). Thus,
contrary to the City’s and the State’s argument, privatization
under Konno is not limited to situations where the government
stops using government employees and transfers to the private
sector the same services through government contracts.
Therefore, this case involves privatization.
B. Under Konno’s Nature of Services Approach, the Frontloader
Collection Crew Leader and Collector Positions Are Within
the Civil Service.
Article XVI, Section 1 of the Hawaiʻi Constitution
concerns constitutionally mandated merit principles and provides
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in relevant part: “The employment of persons in the civil
service, as defined by law, of or under the State, shall be
governed by the merit principle.” As stated in Konno, this
constitutional provision “does not establish an independently
enforceable right to the protection of merit principles.”
Konno, 85 Hawaiʻi at 70, 937 P.2d at 406. Rather, it requires an
examination of statutory and case law to determine which
particular positions fall within the civil service system. Id.
HRS § 76-77 (Supp. 2008), the most relevant statute in
defining the scope of the civil service, states in part:
Civil Service and exemptions. The civil service to which
this part applies comprises all positions in the public
service of each county, now existing or hereafter
established, and embraces all personal services performed
for each county, except the following:
. . . .
(10) Positions specifically exempted from this part by any
other state statutes . . . .
HRS § 76-77 (emphases added); see also Konno, 85 Hawaiʻi at 71,
937 P.2d at 407.
The statutory application of the civil service,
encompassing “all positions” and “all personal services,” is
sufficiently broad to require constraints on a government
official’s ability to privatize services that might circumvent
the protections of the civil service. See Konno, 85 Hawaiʻi at
71, 937 P.2d at 407. While the definition of civil service does
not encompass all positions that provide a service to the
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public, such as the employees of businesses providing electrical
or telephone services, the term is also not limited to only
employees paid regular government salaries because that would
allow public officials to circumvent civil service coverage
“simply by reducing the size of their official payroll.” Id. at
71-72, 937 P.2d at 407-08.
In interpreting this term, the Konno court applied the
nature of services test, which was considered to be the most
consistent with the statutory language in HRS § 76-77. Id. at
72, 937 P.2d at 408. The nature of services test provides that
“services that have been ‘customarily and historically provided
by civil servants’ cannot be privatized, absent a showing that
civil servants cannot provide those services.” Id. at 69, 937
P.2d at 405 (quoting Wash. Fed’n of State Emps., 585 P.2d at
477). Applying this test, this court held that “the civil
service, as defined by HRS § 76-77, encompasses those services
that have been customarily and historically provided by civil
servants.” Id. at 72, 937 P.2d at 408. The Konno court
observed that the nature of services test has several
advantages, including (1) using broad language consistent with
the statutory language in HRS § 76-77; (2) limiting coverage
based on the types of services historically and customarily
provided by civil servants such that the test cannot be applied
so broadly as to lead to absurdity; and (3) focusing on the
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types of services and actual work performed, not the “particular
programs or governmental functions involved or the intent or
motive underlying the decision.” Id.
The nature of services test does not require a
contractual relationship between government and private entities
or individuals. See id. Indeed, the Konno court rejected the
argument that HRS § 76-77 requires a contract, concluding that
“nothing in the statute requires a formal employment contract.”
Id. at 75, 937 P.2d at 411. Specifically, this court noted that
“if HRS § 76-77 required a formal employment contract with the
individual worker, the government could easily circumvent the
statute by obtaining services through an intermediary
corporation,” which could “potentially take all public services
outside the civil service system” and “render HRS § 76-77 a
nullity.” Id. The court emphasized that the nature of services
test focuses on the nature of the positions and services
provided by civil servants, not on whether a formal contract
existed between the government and individual employees. Id.
In this case, the frontloader refuse crew leaders and
frontloader refuse collectors provide essentially the same job
function as those performed by truck drivers and collectors of
private licensed haulers. The actual work performed and the
manner in which it is performed is basically the same. It is
undisputed that the frontloader refuse crew leaders and
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frontloader refuse collectors hold civil service positions and
that they have been providing these services for approximately
the last ten years.
Additionally, the private licensed haulers’ refuse
collection services are replacing the exact same services
provided by the City’s front-end loader work crews. City and
County officials in fact contemplated that employees of private
businesses would replace frontloader refuse crew leaders and
collectors when they sent notices to the 181 properties
regarding the elimination of frontloader collection services.
We therefore conclude that, under the Konno test, the
frontloader collection crew leader and frontloader refuse
collector positions are within the civil service because these
positions have been customarily and historically performed by
civil servants for at least the last ten years.
The City contends that this case is distinguishable
from Konno because the City and County has not entered into any
contract with a private hauler, which would have displaced City
and County employees.10 As discussed, this argument was
10
The City also contends that the termination of frontloader
collection services does not result in privatization because “frontloader
collection worker” is not a civil service status classification. However, as
discussed supra, the services performed for these positions are essentially
the same. Thus, the exact title of the position is a distinction without a
difference because the nature of services test “focuses on the types of
services performed rather than the particular programs or governmental
(continued. . .)
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specifically rejected by the Konno court. Id. at 75, 937 P.2d
at 411. The court explained that requiring a formal contract or
payment could take all public services outside of the merit
system whenever a public official or government agency
unilaterally decides to eliminate a service without a statute
expressly authorizing such an action. See id. In this case,
while there is no formal employment contract between the City
and County and any private hauler, there are pending contracts
between a majority of the 181 entities and private haulers.
Thus, the City and County has essentially provided the refuse
collection services through an “intermediary corporation,”
enabling the circumvention of HRS § 76-77. Id.
The City also argues that Konno’s nature of services
test does not apply because the City and County’s decision to
terminate frontloader collection services does not impact the
pay, benefits, or terms and conditions of employment of front-
end loader work crews. However, the City did not challenge the
circuit court’s finding as to the nature and extent of the
impact upon the affected civil service employees.11
(. . .continued)
functions involved or the intent or motive underlying the decision.” Konno,
85 Hawaiʻi at 72, 937 P.2d at 408.
11
As stated, the circuit court found that termination of the
frontloader services would have directly impacted at least thirteen civil
servants, eliminated three of the six front-end loader work crews, reassigned
(continued. . .)
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Additionally, the Konno court did not consider whether the
County of Hawaii’s privatization effort resulted in loss of pay,
jobs, or benefits to the landfill workers at issue. See id. at
65, 72-74, 937 P.2d at 401, 408-10 (stating that the “actual
work performed by the workers at the new landfill is virtually
identical to the work performed at the old landfill”). Konno
thus indicates that the actual impact of the City and County’s
decision on civil servants is not a requirement under the nature
of services test. See id. Instead, “the protection of civil
service laws extends to those services that have been
customarily and historically provided by civil servants.” Id.
at 72, 937 P.2d at 408.
In the alternative, the City argues that because both
the City front-end loader work crews and private haulers have
provided frontloader refuse collection services in the past,
there cannot be any finding that these services have been
historically and customarily provided only by public employees.
The City contends that HRS § 340A-3(a)12 and ROH §§ 9-3.1 and 9-
(. . .continued)
refuse collection crew leaders and refuse collectors to new routes, and
reduced the City’s front-end loader services by approximately 89 percent on
January 31, 2015.
12
HRS § 340A-3(a) (2010) provides in relevant part:
The county agency responsible for the collection and
disposal of solid waste may require that all solid waste
(continued. . .)
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3.4 (1990)13 expressly recognize that private licensed collectors
and their employees have also provided refuse collection
services. However, contrary to the City’s contention, Konno’s
nature of services test does not require that the services in
question be exclusively performed historically and customarily
by civil servants. See Konno, 85 Hawaiʻi at 69, 937 P.2d at
405.14 Further, the nature of services test considers the
specific public services at issue, not broadly all similar
services that may be provided by both the private and public
sectors. See id. at 71-72, 937 P.2d at 407-08. Therefore, the
City’s contention is contrary to the Konno court’s
interpretation of HRS § 76-77 as applying broadly to “all
(. . .continued)
transported by the county agency, collectors, businesses or
individuals be disposed of at facilities or in areas
designated by the county agency if it is found to be in the
best public interest; provided that agricultural solid
waste and source separated waste transported for recycling
purposes shall not be subject to the provisions of this
section; and provided further that if regional transfer
stations are designated, transportation to the stations
shall be considered so as to minimize the operating costs
of the collector.
HRS § 340A-3(a) (emphasis added).
13
ROH § 9-3.1 (1990), entitled “Business,” and ROH § 9-3.4 (1990),
entitled “Multi unit residential buildings,” relate generally to the refuse
collection and disposal system for these types of entities.
14
If the nature of services test considered all similar services
performed by both the public and private sectors, then, arguably, if civil
servants provided 99% of a particular service and the private sector provided
1% of similar services, the civil servant positions would not qualify for
protection under the constitutional merit principles and civil service laws.
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positions” and “all personal services.” See id. at 71, 937 P.2d
at 407.
Further, in order to exempt a service, and thereby a
civil service position, from the merit system, the State
legislature must enact a statute expressly authorizing the
privatization of that service. See id. at 74-75, 937 P.2d at
410-11. Statutes and ordinances that set standards for
regulating refuse collection and disposal services, such as
HRS § 340A-3(a) and ROH §§ 9-3.1 and 9-3.4, do not amount to an
exemption of refuse crew leader and refuse collector positions
from the civil service system. Consequently, the front-end
loader crew leader and collector positions are within the civil
service unless one of the exemptions enumerated in HRS § 76-77
applies.
C. The Positions Are Not Exempt from the Civil Service System.
If a position falls into one of the exemptions
enumerated in HRS § 76-77, then that position is not part of the
civil service system. Only one of the exceptions in HRS § 76-77
could possibly apply to the facts of this case. HRS § 76-77(10)
provides that positions are not within the civil service if
other State statutes specifically exempt the positions from the
civil service. As noted, the City maintains that HRS § 340A-
3(a) and ROH §§ 9-3.1 and 9-3.4 are the relevant provisions at
issue. However, HRS § 340A-(3) and ROH §§ 9-3.1 and 9-3.4 do
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not address whether the frontloader collection positions are
exempt from the civil service. The Union, on the other hand,
argues that the relevant exemption statute is HRS § 46-33
(1993), which provides in relevant part:
Exemption of certain county positions. In any county with
a population of 500,000 or more, the civil service to which
this section refers is comprised of all positions in the
public service of such county, now existing or hereafter
established, and embraces all personal services performed
for such county, except the following:
. . . .
(7) Personal services obtained by contract where the
director of civil service has certified that the service is
special or unique, is essential to the public interest and
that, because of circumstances surrounding its fulfillment,
personnel to perform such service cannot be obtained
through normal civil service recruitment procedures. Any
such contract may be for any period not exceeding one year.
HRS § 46-33 (emphases added).
Although the City and County has a population of
500,000 or more, none of the enumerated exemptions provide that
the front-end loader crew positions are not within the civil
service. See HRS § 46-33. Further, it is undisputed that the
City did not seek or obtain the required certification required
under HRS § 46-33(7) to exempt refuse collection service
positions from the merit system. Because HRS § 46-33 does not
include a specific exemption, HRS § 76-77(10) is inapplicable,
and frontloader refuse crew leader and collector positions are
within the civil service.
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Additionally, the civil servants in question can
provide frontloader refuse collection services.15 Thus, the City
and County’s decision to terminate, and thereby privatize,
frontloader refuse collection services “deprived civil servants
of the protections guaranteed in article XVI, section 1 and HRS
chs. 76 and 77.” Konno, 85 Hawaiʻi at 74, 937 P.2d at 410.
D. Only a Statute May Authorize the Privatization of Public
Services.
The City contends that Konno should not be applied
broadly to situations in which the government decides to
terminate certain public services, and, similarly the State
contends that the City and County should have the authority to
discontinue certain services for whatever reasons it may have.16
While these arguments raise important policy concerns underlying
the civil service system and privatization, the Konno court
addressed this policy tension by adopting the nature of services
test. Konno, 85 Hawaiʻi at 69-72, 937 P.2d at 405-08.
15
The City does not expressly challenge on appeal the circuit
court’s factual findings as to the following: (1) the decision to discontinue
these services was made, inter alia, by Director Kahikina for “general equity
and non-monetary concerns,” and (2) the civil servants on front-end loader
crews are available to provide these services to the 181 properties on or
after January 31, 2015.
16
The State, joined by the County of Kauaʻi, maintains that it would
be a “radical and unjustified expansion of the civil service laws to construe
them as forcing government to continue providing services it no longer wishes
to provide at all.” Correlatively, the State asserts that if the government
terminates a public service, then that service is no longer part of the civil
service system and cannot be privatized.
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It is the State legislature’s role, not that of this
court or the City and County, to authorize the privatization of
public services. See id. at 74-75, 937 P.2d at 410-11. That
is, if the State legislature determines that the government no
longer wishes to provide certain services or functions, then the
legislature may mandate that the City and County shift the
provision of the services from the government to the private
sector. The Konno court indicated that the State legislature is
in the best position to navigate the policy concerns underlying
privatization. See id. at 75, 937 P.2d at 411 (“Whether or not,
as a policy matter, private entities should be allowed to
provide public services entails a judgment ordinarily consigned
to the legislature.”). If the State legislature expressly
authorizes the termination of a public service, then that
service may be duly privatized, and the job positions providing
that service can be removed from the civil service system and no
longer guaranteed the protections of HRS Chapter 76. See id.
For example, following the Konno decision, the State
legislature provided a statutory exemption, through Act 90, that
specifically authorized privatization. See 1998 Haw. Sess. L.
Act 230 §§ 14, 17 at 789-800; 2001 Haw. Second Sess. L. Act 90
at §§ 2 and 14 at 158-59, 168. However, Act 90, expressly
provided that Part II, entitled “Privatization,” “shall be
repealed on June 30, 2007.” 2001 Haw. Second Sess. L. Act 90 at
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§ 14 at 168. The Act thereafter was repealed by operation of
law, and there is no other similar statute that generally
authorizes the government to engage in the privatization of
services.17 2001 Haw. Second Sess. L. Act 90 at § 14 at 168.
Here, the State legislature did not enact a statute to
expressly authorize or require the privatization of frontloader
collection services to the 181 properties. Therefore, the City
and County had no authority to privatize these public services.
See Konno, 85 Hawaiʻi at 75, 937 P.2d at 411 (finding that “there
is no statute that expressly addresses privatization of public
landfills”). Because City and County officials cannot
themselves authorize the discontinuance of a public service and
thus the privatization of that service, the Department and its
officials lacked authority to discontinue the frontloader
collection services.
E. This Case Does Not Involve a Non-Justiciable Political
Question.
The City also contends that the circuit court erred in
adjudicating a political question involving the legislative
branch’s budget decision-making and the executive branch’s
decision that resulted in the elimination of certain
17
A more recent example of a legislative enactment authorizing a
specific privatization effort is HRS § 323F-52 (Supp. 2015), which expressly
authorizes the privatization of one or more Maui medical facilities of the
Maui regional system.
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governmental services. This court has adopted the United States
Supreme Court’s view of the political question doctrine,
recognizing that “the use of ‘judicial power to resolve public
disputes in a system of government where there is a separation
of powers should be limited to those questions capable of
judicial resolution and presented in an adversary context.”
Trs. of the Office of Hawaiian Affairs v. Yamasaki, 69 Haw. 154,
171, 737 P.2d 446, 456 (1987) (quoting Life of the Land v. Land
Use Comm’n, 63 Haw. 166, 171-72, 623 P.2d 431, 438 (1981)). In
determining whether the political question doctrine should
apply, this court has applied the test set forth in Baker v.
Carr, 369 U.S. 186 (1962). Nelson v. Hawaiian Homes Comm’n, 127
Hawaiʻi 185, 194, 277 P.3d 279, 288 (2012).
Under the Baker test, a case involves a non-
justiciable question if any of the following circumstances
applies: (1) the issue is committed to another political
department; (2) there is a lack of “judicially discoverable and
manageable standards” for resolving the issue; (3) it is
impossible to decide the issue without “an initial policy
determination of a kind clearly for nonjudicial discretion”; (4)
the court cannot independently resolve the issue without
“expressing lack of respect due coordinate branches of
government”; (5) the issue requires the “unusual need for
unquestioning adherence to a political decision already made”;
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or (6) various departments may decide the issue differently,
leading to the “potentiality of embarrassment from multifarious
pronouncements.” Id. (quoting Yamasaki, 69 Haw. at 170, 737
P.2d at 455). “Unless any of [the applicable] formulations
[from the Baker test] is inextricable from the case at bar,
dismissal for nonjusticiability is unwarranted.” Id.
This court has also recognized that the political
question doctrine applies when an issue is clearly committed to
the legislative branch and when the legislature “remains
uncertain about the subject matter at issue or when resolution
of the uncertainty has already been committed to the
legislature.” Id. at 196, 277 P.3d at 290. However, where an
issue involves “textual interpretation, particularly
constitutional interpretation,” that issue is “generally
judicial fare.” Id. at 197, 277 P.3d at 291. Thus, this court
has concluded that “a court is to interpret constitutional
questions as long as there do not exist uncertainties
surrounding the subject matter that have been clearly committed
to another branch of government to resolve.” Id.
In this case, the constitutional question presented is
whether the City and County’s termination of frontloader refuse
collection services is prohibited by State constitutional merit
principles and civil service statutes. This case does not
involve any of the circumstances set forth under the Baker test,
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but rather it concerns the “textual interpretation, particularly
constitutional interpretation” of Article XVI, Section 1 of the
Hawaiʻi Constitution and HRS §§ 76-77 and 46-33, which is
considered “generally judicial fare.” Id. Further, nothing
indicates that this issue is committed to the legislature or
that there are any uncertainties surrounding this issue.
The budget decision-making of the City Council and the
Department’s decision to terminate frontloader refuse collection
services are not the equivalent of a legislative enactment.
That is, the actions of the City and County’s legislative and
executive branches alone cannot authorize privatization and
alter the civil service statutes. Therefore, the issue
presented does not concern the separation of powers and
consequently is not a non-justiciable political question.
IV. CONCLUSION
Accordingly, under HRS § 76-77 and applying the
nature of services test, the frontloader refuse crew leader and
collector positions are within the civil service and governed by
merit principles under Article XVI, Section 1 of the Hawaiʻi
Constitution and HRS Chapters 76 and 77. See Konno, 85 Hawaiʻi
at 74, 937 P.2d at 410. Thus, the City and County’s decision to
terminate frontloader refuse collection services to the 181
properties violated constitutional merit principles and civil
service laws and deprived the civil service workers in this case
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of the protections guaranteed in Article XVI, Section 1 and HRS
Chapters 76 and 77. Because there is no genuine issue of
material fact presented and no non-justiciable political
question involved, the circuit court did not err in granting
partial summary judgment in favor of the Union as to the
asserted violations of merit principles in counts 1 and 2.
Therefore, we affirm the circuit court’s February 26,
2015 “Order Granting Plaintiffs’ Motion for Partial Summary
Judgment Filed on February 20, 2015” and the February 26, 2015
“Order Granting in Part Defendants City and County of Honolulu,
Kirk W. Caldwell, Carolee C. Kubo, and Lori M.K. Kahikina’s
Motion to Certify Orders Granting Plaintiffs’ Motion Temporary
Restraining Order and for Preliminary Injunction and for Partial
Summary Judgment (Counts 1 and 2) and to Stay Proceedings
Pending Appeal.” We also remand the case to the circuit court
for further proceedings consistent with this opinion.
Donna Y. L. Leong and /s/ Mark E. Recktenwald
Ernest H. Nomura
for petitioners /s/ Paula A. Nakayama
Herbert R. Takahashi and /s/ Richard W. Pollack
Rebecca L. Covert
for respondents /s/ Michael D. Wilson
Kimberly Tsumoto Guidry and /s/ Colette Y. Garibaldi
Girard D. Lau
for amicus curiae,
State of Hawaiʻi
35