16:0777(106)CA - IRS, Ogden Service Center, Ogden, UT and NTEU -- 1984 FLRAdec CA



[ v16 p777 ]
16:0777(106)CA
The decision of the Authority follows:


 16 FLRA No. 106
 
 INTERNAL REVENUE SERVICE
 OGDEN SERVICE CENTER, OGDEN, UTAH
 Respondent
 
 and
 
 NATIONAL TREASURY EMPLOYEES UNION
 Charging Party
 
                                            Case No. 7-CA-580
 
                            DECISION AND ORDER
 
    The Chief Administrative Law Judge issued the attached Decision in
 the above-entitled proceeding finding that the Respondent had not
 engaged in the unfair labor practices alleged in the complaint, and
 recommending that the complaint be dismissed.  Thereafter, the Charging
 Party and the General Counsel filed exceptions to the Chief Judge's
 Decision, and supporting briefs, and the Respondent filed
 cross-exceptions and an opposition to the Charging Party's and General
 Counsel's exceptions, and a supporting brief.
 
    Pursuant to section 2423.29 of the Authority's Rules and Regulations
 and section 7118 of the Federal Service Labor-Management Relations
 Statute (the Statute), the Authority has reviewed the rulings of the
 Chief Judge made at the hearing and finds that no prejudicial error was
 committed.  The rulings are hereby affirmed.  Upon consideration of the
 Chief Judge's Decision and the entire record, the Authority hereby
 adopts the Judge's findings, conclusions and recommended Order.  /1/
 
                                   ORDER
 
    IT IS ORDERED that the complaint in Case No. 7-CA-580 be, and it
 hereby is, dismissed in its entirety.  
 
 Issued, Washington, D.C., December 11, 1984
 
                                       Henry B. Frazier III, Acting
                                       Chairman
                                       Ronald W. Haughton, Member
                                       FEDERAL LABOR RELATIONS AUTHORITY
 
 
 
 
 
 
 
 
 
 -------------------- ALJ$ DECISION FOLLOWS --------------------
 
    INTERNAL REVENUE SERVICE
    OGDEN SERVICE CENTER, UTAH
                                Respondent
 
    and
 
    NATIONAL TREASURY EMPLOYEES UNION
                              Charging Party
 
                                       Case No. 7-CA-580
 
    Nicholas LoBurgio, Esq.
    For the General Counsel
 
    Keith A. Aqui, Esq.
    For the Respondent
 
    Before:  JOHN H. FENTON
    Chief Administrative Law Judge
 
                                 DECISION
 
                           Statement of the Case
 
    This proceeding arises under the Federal Service Labor-Management
 Relations Statute (5 U.S.C. 7101 et seq.) and the Final Rules and
 Regulations issued thereunder (5 C.F.R. 2423.14 et seq.) It is based on
 a complaint issued by the Regional Director of Region VII, Federal Labor
 Relations Authority, alleging that Respondent violated Section
 7116(a)(1) and (5) on April 12, 1980, when it "unilaterally implemented
 a change in conditions of employment involving a relocation and
 reorganization affecting tax auditor and revenue agent quality
 reviewers" at its Ogden, Utah, facility.
 
    At issue is the question whether Respondent fully disclosed to the
 Charging Party the adverse impact upon quality review personnel of a
 planned nationwide reorganization of its Service Centers, thus
 foreclosing the opportunity to negotiate such matters before
 implementation occurred.  More specifically, the General Counsel
 contends that Respondent never definitely informed the Charging Party
 that such changes would occur, and that, in any event, while it may have
 allayed the latter's concerns with assurances that there would be no
 adverse impact, i.e., that neither the duties, grades nor numbers of
 such employees would be changed, it did not reveal the fact that they
 would be placed under the supervision (and evaluation) of the very
 managers whose work product they would review.  The predicament of being
 commissioned to expose errors made which are the responsibility of
 supervisors who would rate their performance is the change in employment
 conditions which is central to this controversy.  /2/ At issue also is
 whether the National Treasury Employees Union could designate Chapter 67
 as its representative for the negotiations requested by the latter.
 
    A formal hearing was held in Washington, D.C. on May 19, 1981.  All
 parties were afforded full opportunity to examine witnesses, introduce
 evidence and file briefs.  Upon the entire record, including my
 observation of the witnesses and their demeanor, I make the following
 findings of fact, conclusions of law and recommended order:
 
                             Findings of Fact
 
    1.  The National Treasury Employees Union (NTEU) is the exclusive
 representative of the professional and nonprofessional employees at the
 Ogden Service Center.  Since 1977, it has been the certified
 representative of all such employees in a nationwide consolidated unit
 of the twelve such service centers.  NTEU Chapter 67 also represents the
 Ogden employees, there being an understanding that NTEU negotiates
 contracts and all matters affecting more than one center or facility,
 and that the relevant Chapter bargains with respect to matters affecting
 only that particular facility.
 
    2.  On January 5, 1979, Michael Dolan, Respondent's Labor Relations
 Branch Chief, wrote NTEU National President Vincent L. Connery,
 providing the latter with further information regarding the decision of
 the IRS Deputy Commissioner to establish a Compliance Division in all
 Service Centers.  In relevant part, Dolan said:
 
          You will note that the current Examination Division will become
       a Branch within the new Compliance Division.  Consonant with this
       realignment, the new Examination Branch will consist of two
       sections:  the Classification Section, formerly the Classification
       Branch;  and the Correspondence Examination and Processing
       Section, formerly two separate branches.
 
          The projected impact of this realignment on bargaining unit
       employees in the current Examination Division is somewhat diverse.
        Specifically:
 
          1.  The full working level of the Correspondence Examination
       function will be GS-6.  However, any GS-7 incumbents will not be
       downgraded until such time as the Office of Personnel Management
       revokes its stay on the downgrading of misclassified position.  If
       it becomes necessary to downgrade incumbents, I will notify you
       prior to the issuance of any notices of proposed adverse action.
 
          2.  Those positions currently assigned to the Technical and
       Quality Review Staff of the Examination Division will be
       reassigned to the Quality Review Staff of the new Compliance
       Division and will continue performing the same functions.
       However, since the Quality Review Staff will review work of the
       entire Compliance Division, the number and kind of positions
       assigned to Examination review work may change.  For example,
       there may not be a need for any GS-512 work on the Quality Review
       Staff.  The National Office Examination Division is currently
       developing procedures for their quality review program and as soon
       as they are available, I will forward you a copy.
 
          3.  There will be no GS-526 work in the Correspondence and
       Processing Section.  If any Service Center still has encumbered
       GS-526 positions in the current Correspondence Examination Branch,
       these positions will be abolished no later than June 30, 1979.
 
          4.  Any excess work leader positions which remain encumbered
       will be abolished no later than June 30, 1979.
 
          In all job abolishment actions that this realignment may
       necessitate, all incumbents who meet the eligibility requirements
       will be offered the option of pursuing discontinued service
       retirement prior to my reassignment efforts.
 
          Please provide me with any comments or questions you may have
       before January 23, 1979.
 
    3.  On January 25, 1979, National President Connery wrote all Service
 Center Chapter Presidents, notifying them of Respondent's intention to
 establish a new Compliance Division in Service Centers and of the fact
 that NTEU had requested negotiations on the impact and implementation of
 the change, and requesting their input on the matter.  In connection
 therewith, Connery forwarded the Dolan letter set forth in paragraph 2,
 above.
 
    4.  Between the time of the Dolan letter, and the first and,
 apparently, only negotiation session concerning the reorganization, on
 April 18, IRS management decided to place the Quality Review Tax Auditor
 and Revenue Agent personnel within the Classification Section of the
 Examination Branch of the Compliance Division.  /3/ Thus, these
 employees would, organizationally, be dropped, from the Division level
 two tiers down to the Section level.  There they would be supervised and
 evaluated by Section Chiefs, the work of whose subordinates they would
 review.  This decision was not communicated to NTEU prior to the
 negotiation session.
 
    5.  On April 18, Robert Tobias, Executive Vice President and General
 Counsel of NTEU, met with Bruce Tomaso and a number of other management
 representatives to discuss the planned reorganization and its impact.
 Tomaso, using charts, provided an overview of the organizational changes
 and identified the people (19 Tax Examiners and eight clericals) whose
 jobs were to be abolished.  Tobias asked about the impact on Tax Auditor
 and Revenue Agent Quality Reviewers and was informed that there would be
 no adverse impact upon them because they were to be moved to the
 Classification Section where they would perform the same work at the
 same grade level.  There was only brief mention of this matter, as the
 overriding concern of the conferees was to identify and work out a
 method for placing, elsewhere in the system, those employees whose jobs
 were to be eliminated.  The parties entered an Interim Agreement which
 provided that IRS would furnish NTEU with a "match list" of job
 alternatives for each such employee, and that it would not commence
 adverse action proceedings against employees who were not thereby
 reassigned until after a priority placement program then being developed
 had been negotiated and was in effect.  There was at the meeting no
 mention of the fact that Quality Reviewers would be supervised and
 evaluated by the supervisor who was responsible for the work product
 which they reviewed and, of course, would have occasion to criticize.
 
    6.  Almost one year later, on March 14, 1980, officials of the Ogden
 Service Center informed officials of NTEU Chapter 67 that the Quality
 Review Staff was to be moved organizationally and physically, and would
 be under the supervision of the Chief of the Classification Section of
 the Compliance Division.  The Chapter President responded that such
 changes were negotiable and that negotiations would be requested if
 management insisted on such changes.  Local management said that the
 subject had been negotiated at the national level.
 
    7.  On April 3, 1980, Tobias advised the President of Chapter 67 that
 the subject matter in dispute had not been negotiated at the national
 level, suggested that she request local negotiations and stated that he
 would direct a "check on the matter nation-wide."
 
    8.  On April 8, 1980, Chapter 67 wrote the Director of the Ogden
 Service Center requesting negotiations on the substance, impact and
 implementation of the change and asking for certain information.
 
    9.  On April 21, 1980, the Ogden Service Center implemented the
 change outlined to the Chapter officials on March 14.  No bargaining
 occurred in Ogden.
 
                        Discussion and Conclusions
 
    General Counsel contends that IRS expressly and knowingly created the
 false impression, in the Dolan letter, that the Quality Review Staff
 would be moved laterally from one Division to another, that it never
 thereafter informed NTEU that the reorganization would involve dropping
 the Quality Review Staff to the Section level, and that the obligation
 to provide a reasonable opportunity to bargain about the impact and
 implementation of the placement of such employees at the Section level
 was therefore still alive when the implementation occurred in April of
 1980.  General Counsel further argues that such obligation was owed to
 Chapter 67 because Executive Vice President Tobias authorized the
 Chapter President to negotiate over the change and because the Chapter
 inherently retains the right to negotiate matters of local impact where
 NTEU was not notified that the change was nationwide.
 
    IRS asserts that it did provide NTEU with notice of the contemplated
 change in the Dolan letter and at the April 18 meeting, that it provided
 sufficient information to enable NTEU to develop and submit proposals
 concerning the reorganization, and that it had no obligation to
 negotiate such an issue, in any event, at the local level.  As to its
 fulfillment of its obligation to the NTEU, it argues that it delineated
 the nature of the organizational changes which would occur, and that it
 cannot be held accountable for a failure to divine every potential
 impact of a proposed change.  Rather, it is for the Union to examine the
 consequences of the planned changes and to formulate appropriate
 bargaining demands.  As to the level of bargaining, IRS asserts that
 this was a nationwide change, that the parties' agreement to bargain
 locally only on matters of strictly local impact cannot be repudiated by
 NTEU at its whim, and that President Connery's letter to Chapter
 Presidents, seeking their input for negotiations NTEU had requested over
 the impact and implementation of the establishment of the new Compliance
 Division, constituted acknowledgement that national negotiations were
 appropriate for such subject matter.
 
    The Dolan letter made clear IRS's intention to reorganize all Service
 Centers in the same way.  It was addressed to the national union and
 provoked a bargaining request from the national union, consistent with
 the understanding that such matters are proper subjects for
 national-level negotiations.  While much is made of the tentative nature
 of the plans outlined in the letter ("may"), that word was expressly
 linked to the possibility of a change in the number and kind of
 positions to be assigned to Examination review work, and the example was
 given that there might be no need for Revenue Agents on the new Quality
 Review Staff.  The letter clearly said that the Quality Review Staff
 would be transferred from the Examination Division to the planned
 Compliance Division, and that the Examination Division would become a
 Branch of the new Division.  While I would find it ambiguous with
 respect to whether the Quality Review Staff would be attached to the new
 Examination Division, or would be an "autonomous" unit within the
 Compliance Division, it is clear that IRS intended a lateral transfer
 and that NTEU so understood the letter.
 
    I have found that NTEU was informed at the April 18 discussions, that
 the personnel at issue would be in the Classification Section of the
 Examination Branch of the new Division, where they would perform the
 same work at the same grade level.  I find this matter was addressed
 because the letter left open the question of the placement of the
 Revenue Agents, indicating there might be no need for them on the
 Quality Review Staff, and because a program analyst took notes and made
 a report of that fact.  Thus NTEU was assured they would not be
 "adversely affected," in a context where job abolishment was very much
 the focus of concern, and in a fleeting way.  There is no indication
 that any of the negotiators gave any thought to the notion that such
 placement would create the problem later perceived by Chapter 67
 officials in Ogden.  It was not mentioned, never mind explored.  While I
 agree with IRS that good faith bargaining does not require that it
 divine all potential impact of a change, but only that it give the Union
 fair notice of its intentions, the question remains whether NTEU
 received adequate notice of its decision to place these personnel in the
 Classification Section.  Given the lack of any written notice, the fact
 that only passing reference was made to such placement in the context of
 discussions focusing on adversely affected employees (job elimination or
 downgrading), and the fact that it did not "register" on as astute and
 intelligent a negotiator as Tobias, I conclude that IRS did not provide
 NTEU with adequate notice at that time.  /4/
 
    There is no evidence that IRS's intended reorganization of all its
 Centers was not accomplished.  We know only that this case is confined
 to implementation in Ogden, where Chapter 67 made an issue of the
 matter, that NTEU asserts that it was not made aware of the assignment
 of the affected personnel to the Section level, and that no bargaining
 ever took place concerning the impact of such reassignment.
 
    IRS's decision to reassign these Quality Review personnel from the
 Division level to the Section level, where they would review work which
 was that Section Chief's responsibility, and yet be evaluated for
 purposes of job retention and promotion by that person, gave rise to a
 bargaining obligation respecting the impact and implementation of the
 change.  But that obligation, because it rested on a change which
 affected more than one facility, ran to NTEU rather than any of its
 Chapters.  The bargaining understanding which followed the unit
 consolidation and certification of NTEU, restricted the role of the
 Chapters to matters of purely local concern.  As IRS never adequately
 disclosed to NTEU its intention to drop these personnel through several
 organizational levels, it would follow that, in making such changes, it
 did not fulfill its obligation to first afford NTEU a reasonable
 opportunity to bargain about the procedures to be observed in taking
 such action and appropriate arrangements for employees adversely
 affected.  However, if NTEU can be charged with actual knowledge in
 advance (through Chapter 67) the appropriate response was to demand
 bargaining at the national level, rather than to attempt to commission
 Local 67 to enter local negotiations over a nationwide change.  If it
 can be viewed as learning of a fait accompli, its recourse was to file a
 timely charge directed at the deprivation of its right to reasonable
 notice and an opportunity to negotiate.  It did neither.  Rather it
 alleged, as does the General Counsel's Complaint, that IRS flouted its
 bargaining obligation to NTEU when it refused to negotiate with its
 representatives, the officials of Chapter 67.
 
    While NTEU is free to designate whomever it desires as its
 representative in bargaining, including any officer of Chapter 67, it
 cannot thereby create an obligation that IRS bargain about local matters
 with it (albe