17:0192(30)CA - IRS, Denver District, CO and NTEU and NTEU Chapter 32 -- 1985 FLRAdec CA



[ v17 p192 ]
17:0192(30)CA
The decision of the Authority follows:


 17 FLRA No. 30
 
 INTERNAL REVENUE SERVICE
 DENVER DISTRICT, COLORADO
 Respondent
 
 and
 
 NATIONAL TREASURY EMPLOYEES UNION
 AND NATIONAL TREASURY EMPLOYEES
 UNION, CHAPTER 32
 Charging Party
 
                                            Case No. 7-CA-1070
 
                            DECISION AND ORDER
 
    The 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 in its entirety.  Thereafter, the
 General Counsel filed exceptions to the Judge's Decision, and the
 Respondent filed an opposition to the General Counsel's exceptions.  /1/
 
    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
 Judge made at the hearing and finds that no prejudicial error was
 committed.  The rulings are hereby affirmed.  Upon consideration of the
 Judge's Decision and the entire record, the Authority hereby adopts the
 Judge's findings, conclusions and recommended Order.  /2/
 
                                   ORDER
 
    IT IS ORDERED that the complaint in Case No. 7-CA-1070 be, and it
 hereby is, dismissed.  
 
 Issued, Washington, D.C., March 12, 1985
 
                                       Henry B. Frazier III, Acting
                                       Chairman
                                       William J. McGinnis, Jr., Member
                                       FEDERAL LABOR RELATIONS AUTHORITY
                                       Case No. 7-CA-1070
 
 
 
 
 
 
 
 
 
 -------------------- ALJ$ DECISION FOLLOWS --------------------
 
    Gary A. Anderson, Esquire
       For the Respondent
 
    Mr. Frank D. Ferris
       Craig Deats, Esquire:  On Brief For the Charging Party
 
    James J. Gonzales, Esquire
    Daniel Minahan, Esquire
       For the General Counsel
 
    Before:  WILLIAM B. DEVANEY
       Administrative Law Judge
 
                                 DECISION
 
                           Statement of the Case
 
    This proceeding, under the Federal Service Labor-Management Relations
 Statute, Chapter 71 of Title 5 of the United States Code, 5 U.S.C. 7101,
 et seq., /3/ and the Final Rules and Regulations issued thereunder, 5
 C.F.R. 2423.1, et seq., was initiated by a charge filed on March 16,
 1981 (Jt. Exh. 1).  The Complaint and Notice of Hearing issued on August
 28, 1981 (Jt. Exh. 2) which scheduled a hearing for November 17, 1981.
 By Order dated October 28, 1981, the hearing, scheduled for November 17,
 was indefinitely postponed (Jt. Exh. 4);  by Order dated November 21,
 1981 (Jt. Exh. 5(a)) the hearing, in this and other cases, was
 rescheduled for February 8, 1981;  by Order dated January 20, 1982, the
 hearing, in this and other cases, was rescheduled for calendar call and
 hearing at 1:00 p.m. on April 19, 1982 (Jt. Exh. 5(b));  and on, or
 about, April 15, 1982, by conference call and agreement of all parties,
 the time of the calendar call, to be followed by the hearing in this
 case, was rescheduled for 9:00 a.m. on April 19, 1982, pursuant to which
 a hearing was duly held before the undersigned on April 19, 1982, in
 Denver, Colorado.
 
    All parties were represented at the hearing, were afforded full
 opportunity to be heard, to examine and cross-examine witnesses, to
 introduce evidence bearing on the issues involved, and were afforded
 opportunity to present oral argument.  At the close of the hearing, May
 19, 1982, was fixed as the date for mailing post-hearing briefs which
 time was subsequently extended, upon timely motion of Respondent and for
 good cause shown, to June 18, 1982.  Each party, including the Charging
 Party, timely filed a most helpful brief, received on June 18, 1982,
 which have been carefully considered.  Upon the basis of the entire
 record, /4/ including the Stipulation of Fact (G.C. Exh. 1) and my
 observation of the witnesses and their demeanor, I make the following
 findings and conclusions.
 
                                The Issues
 
    The underlying issues are:  (a) Respondent's right under the National
 Office, Regions and Districts Agreement (NORD) to make lateral
 reassignments;  and (b) whether Respondent lawfully refused to negotiate
 as to certain proposals of the Union.
 
    There is no dispute that Respondent's decision to create a Tax
 Shelter Group in its Denver District Headquarters Office by
 consolidating tax shelter work, already being performed, under a single
 supervisor was a reserved management right;  nor is there any dispute
 that Respondent was, pursuant to Sec. 6(b)(3) of the Statute, obligated
 to bargain on the impact of such decision, i.e., as the Statute
 provides, to negotiate "(3) appropriate arrangements for employees
 adversely affected by the exercise of any authority under this section.
 . ." There is a dispute as to whether Respondent was obligated to
 bargain concerning lateral transfers and the ultimate issue is whether,
 as alleged in Paragraph 4 of the Complaint, " . . . Respondent . . .
 failed and refused to bargain in good faith with the Union on the impact
 and implementation of . . . the formation of a tax shelter specialty
 group. . . ." (Jt. Exh. 2).
 
                                 Findings
 
    1.  The National Treasury Employees Union (hereinafter also referred
 to as "NTEU"), on March 27, 1980, was certified as the exclusive
 representative of all professional and non-professional employees of the
 Internal Revenue Service District Offices, Regional Offices and National
 Office, with certain exceptions not material to this proceeding (Jt.
 Exh. 2, Par. 3);  and NTEU and the Internal Revenue service negotiated a
 national office, regions and districts agreement (NORD) effective
 January 26, 1981 (Jt. Exh. 8).
 
    2.  The action complained of occurred after January 26, 1981, the
 effective date of NORD, and is subject to NORD.
 
    3.  At the end of January or the beginning of February 1981, Mr.
 Sidney C. Smith, Chief, Examination Division, Denver District (Tr. 141),
 called Mr. Frederick J. Lockhart, Jr., then President of NTEU Chapter 32
 (Tr. 49) and now Executive Vice President and Steward for Chapter 32
 (Tr. 48), into his office and notified him that the Denver District
 would be forming a tax shelter group (Tr. 50, 51, 142, 143).
 
    4.  On February 5, 1981, Mr. Lockart sent a letter to Mr. Gerald
 Mihlbachler, District Director, and demanded formal negotiations on the
 substance and/or impact and implementation of the formation of the tax
 shelter group (Jt. Exh. 9).
 
    5.  By letter dated February 18, 1981, Mr. Mihlbachler responded to
 Mr. Lockhart's letter of February 5;  stated that, " . . . we are merely
 reorganizing the Examination Division in order to bring similar work
 (the examination of tax shelter issues) under the supervision of the
 same group manager.  Such work already exists throughout the Denver
 District, but needs to be concentrated within the organization.  There
 is no increased workload, no additional 'program', and no additional
 staffing and/or grade structure associated with this reorganization"
 (Jt. Exh. 10);  Mr. Mihlbachler further stated that, "The formation of
 our 'Tax Shelter Group', which will be located in the Denver
 Headquarters Office, will be accomplished by soliciting volunteers
 and/or reassigning employees already working such cases within the
 Denver metropolitan area" (Jt. Exh. 10);  and Mr. Mihlbachler invited
 proposals "over impact and/or implementation" (Jt. Exh. 10).
 
    6.  By letter dated February 21, 1981, Mr. Lockhart submitted eight
 proposals (Jt Exh. 11).
 
    7.  In late February 1981, Respondent canvassed employees as to their
 interest in working in a tax shelter group, a large case group and
 another group (Tr. 19).  The record does not show, nor has General
 Counsel or the NTEU contended, that Respondent prepared a roster of
 employees interested in working in a tax shelter group, or in any other
 group.  Moreover, no vacancy announcement for the tax shelter group was
 posted (Tr. 18).
 
    8.  By letter dated February 25, 1981, Mr. Mihlbachler declared
 NTEU's proposals non-negotiable and, further, stated,
 
          " . . . it is our position that further initiatives from NTEU
       in mid-term bargaining concerning reassignment impact and
       implementation are not negotiable. . . ." (Jt. Exh. 12).
 
 Accordingly, Mr. Mihlbachler cancelled the negotiating session scheduled
 for February 26, and stated that Respondent would "proceed with
 implementation . . . as scheduled" (March 1, 1981) (Jt. Exh. 12).
 
    9.  By letter dated February 26, 1981, Mr. Lockhart protested Mr.
 Mihlbachler's letter of February 25;  again demanded negotiations on
 NTEU's proposals of February 18;  and requested deferral of
 implementation "until completion of the demanded negotiations and the
 reaching of a final and full agreement. . . ." (Jt. Exh. 13).
 
    10.  By undated letter (Jt. Exh. 14), Mr. Mihlbachler, replied that,
 as requested, he had reconsidered NTEU's bargaining proposals;  that,
 "Since . . . you have raised the issue of changing the physical layout
 of office space, which is separate and apart from the reassignment
 issue, we are willing to discuss 'Union Proposal No. 5' . . . Therefore,
 we have rescheduled negotiations for Friday, March 6, 1981 . . .  Our
 position on the remaining issues raised in your bargaining proposals
 remains unchanged from that taken in my letter of February 25, 1981. . .
 ." (Jt. Exh. 14).
 
    11.  The parties met on March 6, 1981, and negotiated on NTEU
 Proposal No. 5 and reached tentative agreement.  Indeed, Mr. Lockhart
 stated "we initialed those changes" (Tr. 60);  but Mr. Lockhart refused
 to finalize any agreement because "we had additional proposals that we
 wanted to negotiate . . . and without final and full agreement there was
 no agreement . . . ." (Tr. 60).  Although I am aware that Mr. Lockhart
 testified that he asked,
 
          ". . . Will you negotiate with us on any procedures involved in
       the establishing of a tax shelter group?"
 
 and
 
          ". . . Will you negotiate with us on any impact, or potential
       impact, arising out of this change?" (Tr. 59, 186-187).
 
 and that Respondent declined, "The reason was the same as the reason
 that was given to me before because of the February 25, 1981, letter . .
 .  From Mr. Mihlbachler and 'Because we believe that if we follow the
 NORD agreement, we have done everything we are obligated to do'" (Tr.
 59).
 
    12.  Mr. Douglas W. Duvall, now Personnel Officer (Tr. 148), at all
 times material had been a Personnel Management Specialist handling labor
 relations and other employee programs for Respondent and was chief
 spokesman for Respondent on March 6, 1981.  Mr. Duvall testified, in
 part, as follows:
 
          "A.  As I recall, the first thing that we did when we sat down
       in our negotiating session was to try to clarify the positions,
       and Mr. Lockhart asked if we had modified our position in terms of
       the reassignment issue, and I said no, that we had not, that it
       was still our position that these had been negotiated.
 
          "I asked Mr. Lockhart, basically, what NTEU's position was in
       terms of which kinds of changes that he saw that may have come
       about that gave rise to this request to negotiate, and he replied
       basically that there were two major things that NTEU was looking
       at in these negotiations.  First of all, that any time management
       underwent any kind of reorganization that involved bargaining unit
       employees, that it was subject to full negotiation, impact and
       implementation negotiation, including the methods, the procedures
       to follow in reassigning these employees.
 
          "Secondly, that in terms of any realignment of office space
       that came out of such a reorganization, they had full right to
       negotiate over impact and implementation of that office space
       realignment, prior to implementation.
 
          "Q.  During those discussions, did you close the door on him
       with respect to submitting proposals, additional proposals, that
       would go to impact or implementation?
 
          "A.  No, sir, we did not.
 
          . . . . (Tr. 154-155).
 
    13.  Mr. Irving A. Des Roches, employed by IRS since October 1, 1969,
 initially as the "de facto chief negotiator", and since 1972 officially
 as Chief Negotiator for IRS (Tr. 85).  Mr. Des Roches served as
 negotiator and Spokesperson for IRS in the negotiation of the NORD
 Agreement.  Negotiations for the NORD Agreement began in August 1978
 (Tr. 108), and Mr. Robert M. Tobias was Chairperson and Chief
 Spokesperson for NTEU.  Mr. Frank D. Ferris, Director of Training and
 Negotiations, NTEU, first personally appeared at the NORD negotiations
 in October 1979 (Tr. 106, 160), and when present either acted as
 co-spokesperson with Mr. Tobias or, when Mr. Tobias was not present, as
 spokesperson for NTEU.
 
    14.  Mr. Des Roches testified in great detail, and at considerable
 length, concerning the negotiating history, development, meaning, and
 intent of Article 7 of the NORD Agreement.  I found Mr. Des Roches'
 testimony in this matter wholly credible.  Mr. Ferris also testified at
 length concerning Article 7 and I found his testimony equally credible.
 Indeed, Mr. Ferris' testimony fully corroborated the testimony of Mr.
 Des Roches.  /5/
 
    15.  There is no doubt whatever that IRS wanted, and believed it had,
 the right unilaterally to make lateral reassignments.  Consequently, IRS
 was very unhappy with the decision of the Assistant Secretary in
 Internal Revenue Service, Kansas City, Ogden, Chamblee, Philadelphia,
 Austin, Covington, Fresno, and Brookhaven Service Centers, Detroit Data
 Center and Martinsburg National Computer Center, A/SLMR No. 1074, 8
 A/SLMR 741 (1978) (Res. Exh. 1);  /6/ and the Bruce arbitration decision
 which "precluded management from having the right of laterally
 reassigning during the life of a roster" (Tr. 117, 163).  In addition,
 the Authority, in National Treasury Employees Union and Internal Revenue
 Service, 7 FLRA 275 (1981), held inter alia, that NTEU's proposal that
 Article 7 (Promotions/Other Competitive Actions) applied to lateral
 transfers and was negotiable.
 
    16.  There is also no doubt whatever that IRS in the NORD
 negotiations specifically sought, through negotiations, to "undo the
 effect of decision 1074, which was a lead case in requiring management
 to bargain mid-term in reorganization requests and lateral
 reassignments.  Another part of this objective was to undo the
 arbitrational decision (Bruce) which precluded management from having
 the right of laterally reassigning employees during the life of a
 roster" (Tr. 116-117).
 
    17.  Mr. Des Roches described a roster as follows:
 
          "A.  A roster is a listing of employees who have been found
       highly qualified for a particular position, a position which
       management expects there will be a number of vacancies in during a
       six-month period.
 
          "Q.  Is a roster related to the posting of a job?
 
          "A.  Yes.  The job is posted-- management does not say this but
       everybody knows that management expects a number of vacancies in
       that position during a six-month period and the people respond to
       the announcement.  From the response, a roster is built on the
       basis of scores achieved by those who respond. . . ." (Tr. 87)
 
 Mr. Ferris, also described a roster as follows:
 
          "A.  A roster is the product of a particular type of vacancy
       announcement.  A vacancy announcement can be of two kinds;  one
       which we call ad hoc which merely announces the immediate existing
       vacancy in a position, or it can be an announcement to set up a
       roster.  In the latter case, there may or may not be an immediate
       vacant position but there's an expectation that over the next six
       months for the six months of the roster, there will be several
       positions to be filed in that classification.
 
          "A vacancy announcement can do one of two things and a roster
       is one of them. . . ." (Tr. 174-175).
 
    18.  There is no doubt whatever that, as the result of negotiations,
 IRS in the NORD Agreement received the right to make unilateral
 reassignment of employees at a post of duty.  Mr. Des Roches so
 testified (Tr. 104-105;  107-108) and Mr. Ferris fully concurred,
 testifying, in part, as follows:
 
          "A.  The sole difference-- if you're asking me to look at
       Article 7-- is the fact that we have changed the roster situation,
       as Mr. Des Roches testified.  He came into bargaining, looking to
       undo the Bruce arbitration case.  They have us an offer in the
       final stages of mediation that they would give us their
       consideration, it would be easy for them if they used rosters, but
       by establishing rosters, they didn't want to hurt themselves by
       barring lateral reassignments.  So they asked us to, in effect I
       guess, give up the Bruce arbitration precedent and permit them to
       reassign during the existence of a roster.  We made that deal.  We
       conceded that. . . ." (Tr. 180-181).
 
 Earlier, Mr. Ferris testified,
 
          " . . . we permitted IRS to laterally reassign while a
       promotional roster was in existence.  That right was granted in
       return for the first consideration right. . . ." (Tr. 161-162).
 
 and,
 
          "Q.  . . . Can management effect a lateral reassignment without
       using competitive procedures, even though a roster has been
       established under NORD?
 
          "A.  I'll explain it with a different perspective.  For one
       example, if it's a lateral reassignment between post of duties,
       no, they have to use the competition that flows through seniority.
        If it's a lateral-- and you can see that through Article 29.  If
       it's a lateral reassignment associated with the changes found to
       be negotiable, then Article 29, Section 3 comes in.  /7/ If it's a
       lateral reassignment that does not have a change, it is not
       associated with moving from one post of duty to another, then,
       even if a roster is in existence, they are permitted to make that
       reassignment without using competitive procedures.  You have to
       look at associated effects that the contract brings out.  Is there
       a different post of duty;  is there a change connected with it?
       It's a totality" (Tr. 177-178).
 
    19.  General Counsel, in his Brief, states, in part, as follows:
 
          " . . . Whereas the competitive procedures in MDA-3, Article 7
       (the prior agreement, Jt. Exh. 6) applied when a roster was
       established, those procedures do not apply in NORD when a roster
       has been established.  Respondent's argument seems to be, then,
       that the competitive procedures in NORD Article 7 do not apply to
       the type or reassignments involved in this case.  The General
       Counsel concedes as much.  (Emphasis supplied).  Vacancy
       announcements were not posted for the Tax Shelter Group positions
       (Robbins, Tr. 18;  20-22) and the positions were filled by
       canvassing for volunteers, not by selecting from a roster. . . ."
       (G.C. Brief, p. 18).
 
    20.  Article 7, Promotions/Other Competitive Actions, of the NORD
 Agreement provides, in part, as follows:
 
          "Section 1
 
          "The purpose of this Article is to ensure that all competitive
       promotions to bargaining unit positions and certain placement
       actions as set forth in Section 2 below are made on a merit basis
       by means of systematic and equitable procedures so that employees
       are given the opportunity to develop and advance to their full
       potential.  The purpose of this Article is also to provide that
       Internal Revenue employees receive first consideration for all
       actions set forth in Section 2B below.  /8/ To that end, the
       Employer and the Union agree to the following procedures (Emphasis
       supplied).
 
          "Section 2
 
          "A
 
          "The terms of this Article will not apply to the filling of
       bargaining unit vacancies by lateral reassignment, demotion or
       reinstatement, except as set forth in B below . . . (Emphasis
       supplied).
 
          "B
 
          "The terms of this Article will apply to all other placement
       actions within the bargaining unit (Emphasis supplied).  The
       following are examples of such actions:
 
                                .  .  .  .
 
          "6.  Filling a position by lateral reassignment if a vacancy
       announcement has been posted, unless (1) unforeseen circumstances
       of an extraordinary nature become known subsequent to the posting
       of vacancy announcement;  or (2) a roster has been established."
 
    21.  Following the negotiating session of March 6, 1981 Respondent by
 memorandum dated March 11, 1981, notified ten named individuals of their
 reassignment to the Tax Shelter Group, Group 1225, effective March 22,
 1981.  All affected individuals /9/ were in the Denver District (G.C.
 Exh. 2).  /10/
 
                                Conclusions
 
    For the reasons set forth above, I find and conclude that IRS,
 through negotiations, in the NORD Agreement obtained the right to make
 unilateral reassignment of employees within a post of duty when no
 vacancy announcement has been posted.  Accordingly, as IRS had obtained,
 under the NORD Agreement, the right to make lateral reassignments,
 Respondent's decision to laterally reassign employees to Group 1225, the
 Tax Shelter Group, was not a matter as to which Respondent was required
 to bargain and Respondent's issuance of its memorandum of March 11, 1981
 (G.C. Exh. 2) did not violate either Sec. 16(a)(5) or Sec. 16(a)(1) of
 the Statute.
 
    In reaching this decision, I have given careful consideration to the
 decision of Judge Arrigo, in Internal Revenue Service (District, Region,
 National Office Units) and National Treasury Employees Union, Case Nos.
 3-CA-2206 and 3-CA-2876) (OALJ-82-58) (March 5, 1982), and find it both
 legally and factually distinguishable from the present case and neither
 controlling nor determinative herein.  First, the Commodity Tax Shelter
 proposal was made on August 11, 1980, and the Windfall Profit Tax
 proposal was made on June 19, 1980.  In each instance, the union's
 proposals were made in 1980 under the predecessor agreement to NORD and
 Judge Arrigo specifically held, in part, as follows:
 
          "I further reject Respondent's contention that the terms of the
       NORD agreement govern the matter at issue herein and by executing
       the NORD agreement the Union waived its right to continue
       negotiations on the procedures for staffing CTS and WPT programs.
 
          " . . . under MDA III, the predecessor agreement between the
       parties, the parties had a practice of periodically negotiating
       over reassignments of similar personnel actions to accommodate
       employees who were being affected by a reorganization. . . .
 
          " . . . Thus, the negotiations on staffing began in September
       1980 and the parties recognized during the December 22, 1980
       discussion, that intervention by the Federal Mediation and
       Conciliation Service would be required.  The services of the FMCS
       were invoked . . . and the parties proceeded to mediation on
       February 2, 1981 and then to impasse proceedings on March 26.  At
       no time to this point did either the Union or Respondent by its
       conduct indicate other than a desire to resolve their dispute
       following the practice established under MDA III, i.e.,
       negotiation.  Neither the language of the NORD agreement executed
       January 26, 1981, nor testimony relating to discussions giving
       rise to the NORD agreement nor at any other time, indicate that
       the dispute concerning the CTS and WPT programs was to be governed
       by NORD.
 
                                .  .  .  .
 
          "Accordingly, I conclude in all the circumstances that the
       execution of the NORD agreement did not constitute a waiver of the
       Union's right to negotiate to finality under MDA III the staffing
       procedures to be used vis-a-vis the CTS and WPT programs."
 
    By contrast, the lateral reassignments involved in the present case
 arose after the negotiation of the NORD Agreement and are governed
 solely by the NORD Agreement.
 
    Second, the record in this case shows that IRS sought in the NORD
 Agreement the right to make unilateral reassignment of employees at a
 post of duty.
 
    Third, the record in this case shows that NTEU, as Mr. Ferris
 testified, " . . . made that deal.  We conceded that. . . ." (Tr. 181);
 " . . . we permitted IRS to laterally reassign while a promotional
 roster was in existence.  That right was granted in return for the first
 consideration right. . . ." (Tr. 161-162);  IRS sought to "undo the
 Bruce arbitration case" (Tr. 180) and NTEU agreed (Tr. 181).
 
    Consequently, while I do not disagree in the slightest with the
 decision of Judge Arrigo that nothing in the NORD Agreement purported to
 waive rights which existed under MDA III as to personnel actions
 instituted under MDA III, the record in this case is clear that IRS in
 the NORD Agreement sought and obtained the right to make unilateral
 lateral reassignments of employees even, as the record shows, when a
 roster has been established.  Necessarily, as Mr. Des Roches testified,
 if IRS obtained the right in NORD to make lateral reassignments when a
 roster had been established, as Mr. Ferris conceded, then it also had
 the right to make such lateral reassignments when no roster existed.  As
 noted, the record does not show that a roster existed in this case and,
 because a roster, as Mr. Ferris explained, is the product of a vacancy
 announcement and it is conceded that no vacancy announcement was posted,
 I would assume that no roster existed - indeed General Counsel admits
 that there were no selections from a roster (G.C. Brief, p. 18);
 nevertheless, even if a roster existed, the testimony, including that of
 Mr. Ferris, plainly shows that NTEU in the NORD Agreement " . . .
 permitted IRS to laterally reassign while a promotional roster was in
 existence.  That right was granted in return for the first consideration
 right. . . ." (Tr. 161-162).
 
    While IRS in the NORD Agreement received the unilateral right to
 laterally reassign employees, and the exercise of that right imposed no
 obligation on Respondent to bargain about its lateral reassignment of
 employees to Group 1225, nothing in the NORD Agreement waived, or
 purported to waive, Respondent's obligation to bargain as to
 "appropriate arrangements for employees adversely affected by the
 exercise of any such authority . . ." (Sec. 6(b)(3)), although, by
 granting IRS the unilateral right to make lateral reassignments, NTEU
 necessarily gave up, or waived, the right to negotiate concerning
 procedures IRS would follow in the exercise of this contractual
 unilateral right.  Stated otherwise, a contractual grant of authority to
 take unilateral action differs from mere reservation of a management
 right in that, by granting management the right to act unilaterally, the
 union has agreed not only that management may act, but, has agreed that
 the manner by which the right is exercised, including how, when, or
 whether the right is exercised, has been given wholly to management;
 whereas, a reservation of a management right constitutes only a right to
 act, not a grant of authority as to the manner by which the right is
 exercised.  As to the latter, i.e., reservation of a management right,
 the union retains the right to negotiate concerning both the procedures
 management will observe (Sec. 6(b)(2)) and appropriate arrangements for
 employees adversely affected by the exercise of the authority (Sec.
 6(b)(3));  but as to the former, i.e., the grant of authority to take
 unilateral action, the union, by its grant of unilateral authority, has
 agreed that the procedures management will observe are not negotiable
 because it has given those rights to management, and, accordingly, the
 union retains only the right to negotiate concerning appropriate
 arrangements for employees adversely affected by the exercise of the
 authority granted.
 
    Respondent's letter of February 25, 1981, in which it stated, in
 part,
 
          " . . . that further initiatives from NTEU in mid-term
       bargaining concerning reassignment impact and implementation are
       not negotiable. . . ." (Jt. Exh. 12).
 
 was in derogation of its obligation to bargain as to impact of its
 decision to laterally reassign employees and Respondent did thereby
 violate both Secs. 16(a)(5) and (1) of the Statute.  However, NTEU, by
 letter dated February 26, 1981, protested Respondent's refusal to
 negotiate, stating, in part, that,
 
          " . . . Chapter 32 has previously and timely submitted written
       demands pursuant to your February 18, 1981, letter request.  These
       proposals are hereby re-urged upon you" (Jt. Exh. 13).
 
 Respondent, by undated letter, stated that it had reconsidered NTEU's
 bargaining demands;  that it found NTEU's Proposal No. 5,
 
          " . . . separate and apart from the reassignment issue, we are
       willing to discuss 'Union Proposal #5 from your letter of February
       21, 1981.  Therefore, we have rescheduled negotiations for Friday,
       March 6, 1981 at 8:00 a.m. to discuss that issue.  Our position on
       the remaining issues raised in your bargaining proposals remains
       unchanged from that taken in my letter of February 25, 1981" (Jt.
       Exh. 14).
 
 In addition, Respondent in the same letter informed Mr. Lockhart that
 implementation would be delayed until after March 6, 1981 (Jt. Exh. 14).
 
    The parties did meet, negotiate, and reached agreement on March 6,
 1981, on NTEU Proposal No. 5.  There is no dispute that Respondent, on
 March 6, 1981, refused to bargain on:  Union Proposal for Preamble;
 Union Proposals 1, 2, 3, and 4;  and, because NTEU, although it
 initialed, i.e. agreed to, changes on Proposal No. 5, declined to
 conclude any agreement unless or until there was "final and full
 agreement" on all of its proposals (Tr. 60), Respondent asserts that
 NTEU proposals 6, 7, and 8 never became "ripe" for negotiations.  As
 NTEU proposals 6, 7, and 8 presuppose the existence of an "agreement",
 which NTEU declined to conclude, and as the record does not show that
 NTEU separately addressed these proposals, no purpose would be served in
 considering these proposals further.
 
    Two questions remain:  (a) was Respondent required to bargain on NTEU
 proposals 1, 2, 3, and 4 (and NTEU's proposal for Preamble)?; and (b)
 Did NTEU seek to bargain on any matter other than its written proposals?
 
          (A) NTEU Proposals (Jt. Exh. 11) Preamble.  /11/ NTEU's
       proposal stated,
 
 in pertinent part that,
 
          " . . . The purpose of this agreement is to establish
       consistent procedures for assignment of employees to the Denver
       District Tax Shelter Group" (Jt. Exh. 11).
 
 The procedures sought by NTEU are set forth in proposals 1 through 4,
 discussed hereinafter.  NTEU's objective clearly was to negotiate
 procedures for the assignment of employees;  but by the NORD Agreement
 IRS had obtained the right unilaterally to make lateral transfers of
 employees.
 
    Proposal No. 1.  This set forth the procedures for filling vacancies.
  Under other circumstances, I have no doubt that such proposal would be
 negotiable, indeed, substantially similar proposals were held to be
 negotiable under prior IRS-NTEU Agreements, Department of the Treasury,
 Internal Revenue Service, Jacksonville District, Jacksonville, Florida,
 4-CA-446, OALJ-81-89 (April 15, 1981);  Internal Revenue Service
 (District, Region, National Office Units), 3-CA-2206, 3-CA-2876, OALJ
 82-58 (March 5, 1982);  see, also, National Treasury Employees Union and
 Department of the Treasury, Internal Revenue Service, 6 FLRA 508, 514
 (1981).  But the right unilaterally reassign employees was a right IRS
 had sought in the NORD negotiations and was a concession granted by NTEU
 in the NORD Agreement in exchange for a right long sought by NTEU and
 offered by IRS.  As Respondent's right to laterally reassign had been
 negotiated, Respondent was under no obligation to bargain on proposal
 No. 1.  Proposal No. 1 was directed at the filling of vacancies, not to
 impact of Respondent's exercise of its negotiated right to make lateral
 reassignments.
 
    Proposal No. 2.  This proposal was as follows:
 
          "The Tax Shelter Group initially, at least, will have its
       location in the Denver headquarters office.  However, no employee,
       who is involuntarily reassigned . . . and who at this time of
       his/her reassignment is located in an office other than the one in
       which the Group is located, will be forced to relocate to the
       office when the Group is located.  Any such employee will be
       permitted to physically remain in the group and office where
       he/she is then located, even though for purposes of group
       assignment and group function, such as group meetings, said
       employee's group will be the Tax Shelter Group."
 
 By seeking to restrict relocation from one group to another this
 proposal also sought to limit the contractually established right of
 Respondent to make lateral transfers of employees.  Moreover, the
 proposal was not negotiable because it conflicts with Respondent's
 rights, pursuant to Sec. 6(a)(1) of the Statute, to determine its
 organization, American Federation of Government Employees, AFL-CIO,
 Local 3805 and Federal Home Loan Bank Board, Boston District Office, 5
 FLRA No. 94 (1981);  directly interferes with Respondent's right,
 pursuant to Sec. 6(a)(2)(A) of the Statute, to assign employees,
 Department of Defense v. FLRA, 659 F.2d 1140, 107 LRRM 2901 (D.C. Cir.
 1981);  and bargaining, pursuant to Sec. 6(b)(1) of the Statute, as to "
 . . . the number, types, and grades of employees or positions assigned
 to any organizational subdivision . . . ", is only "at the election of
 the agency" and Respondent elected not to negotiate concerning this
 proposal.
 
    Proposal No. 3.  This proposal was as follows:
 
          "Assignment to the Tax Shelter Group will not adversely affect
       an employee's opportunities or consideration for developmental
       assignments, e.g. OJI, classroom instructor, detail to review,
       etc."
 
    The record does not show the relevancy of this proposal to impact of
 the lateral transfers of employees from various groups to the tax
 shelter group.  Indeed, the wholly credible testimony of Mr. Sidney C.
 Smith, Chief, Examination Division, Denver District, showed that
 assignment to a specialty group does not affect promotional
 opportunities that, " . . . You have the same promotional opportunities
 whether you're in the specialty group or a general program group. . . ."
 (Tr. 141);  and that assignment to the tax shelter group was not
 assignment to a specialty group, such as the excise tax group, for the
 reasons that:  they continue to work income tax, and, while they
 concentrate on tax shelter, they have related pickup type returns, which
 may involve corporations, partnerships, or individuals, of the " . . .
 same type that they are working in the general areas. . . ." (Tr. 142).
 Nevertheless, if the subject matter of this proposal were material to
 impact of lateral assignments, it was already governed by the provisions
 of Article 12 of the NORD Agreement.  Thus, by way of example, Article
 12, Section 5A provides,
 
          "1.  When training is given primarily to prepare employees for
       promotion, selection for the training will be made under the
       competitive promotion procedure.
 
          "2.  In addition, selection of on-the-job instructors and
       classroom instructor positions will be made under the competitive
       promotion procedures" (Jt. Exh. 8, P. 12).
 
 General Counsel effectively concedes the applicability of Article 12,
 stating that, "It is true that the Union proposal raises issues embraced
 by the term 'training'. . . ." (General Counsel Brief, p. 12);  but his
 assertion that "nothing in NORD Article 12 states it is the final
 expression of the parties on this subject nor is it conceivable that it
 embraces the particular needs of employees in every field of tax work"
 (General Counsel Brief, p. 12), is a non sequitur and his quotation from
 Internal Revenue Service, Case No. 3-CA-1067, OALJ 82-78 (1982), that
 nothing in the NORD Agreement, "waives the Union's right to negotiate
 the impact and implementation of specific training programs, or training
 in general" is a red herring since, clearly, this case involved no
 training program whatever.  Indeed, "training" enters the picture only
 because the provisions of Section 5A which address, inter alia, OJI and
 classroom instructor selection, are part of Article 12 which is entitled
 "Training".  Accordingly, Respondent was under no obligation to bargain
 as to Proposal No. 3.
 
    Proposal No. 4.  The primary thrust of this proposal was to make the
 assignment to the tax shelter group rotational, i.e., employees would be
 rotated out of the tax shelter group within 27 months.  In addition,
 NTEU requested, as part of Proposal No. 4, the adoption, in part, of the
 following language, from a prior local agreement, relating to training:
 
          " . . . The Employer recognizes that some employees will need
       training when they are rotated into income tax, therefore, formal
       and informal training will be available on a case by case basis."
 
    As to rotation, Proposal No. 4 conflicts with management's right to
 assign employees under Sec. 6(a)(2)(A) of the Statute.  American
 Federation of Government Employees, AFL-CIO, Local 695 and Department of
 the Treasury, U.S. Mint, Denver, Colorado, 3 FLRA 43 (1980).  While an
 agency may, pursuant to Sec. 6(b)(1) of the Statute, at its election,
 bargain on such assignments, Respondent elected not to negotiate on this
 proposal and whether it had elected on some prior occasion to negotiate
 on rotation of other assignments is immaterial, as, plainly, Respondent
 did not elect to bargain in this instance and, absent its election to
 negotiate, Respondent had no obligation to bargain.  The local agreement
 referred to by NTEU was entered into in 1978 and, as the record shows,
 resulted from a management proposal to confirm an existing practice.
 Not only is the validity of the 1978 local agreement unquestioned but
 Article 29, Section 4 of the NORD Agreement provides that,
 
          " . . . Supplemental Agreements and/or memoranda of
       understanding regarding rotation would be incorporated into the
       Agreement with opportunity for NTEU to complete negotiations on
       the subject which are in progress on the effective date of the new
       Agreement" (Jt. Exh. 8, p. 28).
 
 Consequently, IRS in the NORD Agreement contractually "elected" to
 negotiate concerning rotation but only as to negotiations in progress on
 the effective date of the NORD Agreement, January 26, 1981.  This
 "election" to negotiate did not extend to NTEU's Proposal No. 4 and
 Respondent expressly declined to bargain on Proposal No. 4.
 
    As to training, it is uncertain what was intended.  Certainly, the
 language, from the 1978 local agreement, was ill suited, or as
 Respondent states (Respondent's Brief p. 18, n. 13), reference to
 rotation into "income tax" is misplaced for the reason that tax shelter
 work involves solely income taxes.  In any event, training as involved
 was fully governed by Article 12, Sections 1 and 3 of the NORD Agreement
 and Respondent was not obligated to bargain further locally.
 
    I have given careful consideration to General Counsel's assertion
 that Respondent did not declare NTEU's proposals non-negotiable.
 Without deciding whether in an enforcement proceeding, there is a legal
 difference between a refusal to bargain on a proposal and a refusal to
 bargain because a proposal is deemed "non-negotiable," /12/ as the
 record shows that Respondent stated reasons for its refusal to bargain,
 I conclude that Respondent did effectively declare NTEU's proposals
 non-negotiable, ie.g. Respondent refused to bargain because NTEU's
 proposals were governed by the NORD Agreement, even though Respondent
 did not use term "non-negotiable" at least as to certain proposals.
 /13/ Thus, Respondent on March 6 stated, inter alia, /14/ that it would
 not negotiate, except on Proposal No. 5, because NTEU's proposals,
 except No. 5, were governed by the NORD Agreement, or, as Mr. Lockhart
 stated, Respondent asserted that, " . . . if we follow the NORD
 agreement, we have done all that we are obligated to do" (Tr. 58).
 Indeed, Respondent's statement in agreeing to negotiate as to Proposal
 No. 5, because it "is separate and apart from the reassignment issue"
 had further made it clear that, in its opinion, only Proposal No. 5
 concerned impact while the other proposals concerned the reassignment
 issue.
 
    In truth, it is far from clear that in an enforcement proceeding the
 form of a refusal to bargain is significant.  For example, a refusal to
 bargain by an agency is an unfair labor practice only if there is a
 refusal to bargain in good faith " . . . as required by this chapter"
 (Sec. 16(a)(5)) and an agency is not required to negotiate as to those
 rights reserved to management by Sec. 6(a) of the Statute.  Therefore,
 in order to find an unfair labor practice, it must be determined that
 the agency was required by Chapter 71 to negotiate, regardless of the
 manner in which the refusal to bargain arises.
 
          (B) Did NTEU Seek to Bargain on Any Matter Other than Its
       Written Proposals?
 
    At the hearing, I rejected General Counsel's Exhibit No. 8, which was
 a portion of a handwritten letter by Mr. Lockhart, presumably written on
 March 6, 1981, after the negotiating session, although the date of the
 letter was also given as March 3, 1981 (Tr. 187).  In his Brief, General
 Counsel has urged reconsideration of this ruling and states that, "It is
 submitted that the self-serving aspects of the letter are outweighed by
 its probative aspects" (General Counsel Brief, p. 11, n. 4).  I have
 reconsidered my ruling and, in agreement with the request of the General
 Counsel, reverse my prior ruling and hereby receive General Counsel's
 Exhibit 8.  The full text of General Counsel's Exhibit 8 is as follows:
 
          "Management's current position, we would consider any
       implementation an unfair labor practice.  I also stated (also no
       less than twice) that our position was that Management had the
       right to make the change but that we had the absolute right to
       negotiate the substance of our proposals and that Management had a
       corresponding duty to negotiate on these proposals.
 
          "We submitted each of our proposals.  Doug Duvall gave me
       specific responses to Union Proposals on the Preamble and #'s 1,
       2, and 4.  That position was that Management's position was the
       same as stated in Mihlbachler's 2/25/81 letter to me and that
       Management's obligation to negotiate was fulfilled as long as NORD
       followed.  Doug Duvall and Sid Smith agreed that the same could be
       said of all remaining Union Proposals except Proposal #5 which we
       were negotiating.  Suzanne and I asked the specific questions re
       Management's refusing to negotiate (1) any proposal pertaining to
       procedures being used to establish the tax shelter group and
       implement the change and (2) any proposal relating to the adverse
       effect on employees.  Doug's answer was that these were correct
       statements and he again referred us to NORD and the 2/25/81
       letter.  Also in this regard Doug stated in answer to my specific
       question, that Management was not declaring any proposals
       non-negotiable but that they were just saying that these proposals
       were previously negotiated under NORD" (G.C. Exh. 8).
 
    That Mr. Lockhart raised the question of adverse impact bargaining is
 clear enough;  but was his question directed only to NTEU's written
 bargaining proposals?  I conclude, after careful review of the record,
 that his question concerned only NTEU's written proposals.  Thus, the
 record shows:  (a) Mr. Lockhart's initial testimony that he asked "Will
 you negotiate with us on any impact, or potential impact, arising out of
 this change" (Tr. 59), was substantially altered by his testimony or
 rebuttal, that he asked, "whether or not they were willing to negotiate
 any proposal relating to the adverse impact" (Tr. 186);  (b) Mr.
 Lockhart's letter fully confirms his testimony on rebuttal and states
 that he asked "specific questions re Management's refusing to negotiate
 . . . (2) any proposal relating to the adverse effect on employees"
 (G.C. Exh. 8) to which Mr. Duvall responded "that these were correct
 statements and he again referred us to NORD and the 2/25/81 letter"
 (G.C. Exh. 8);  (c) the fact that no proposal was ever made by NTEU
 except its written proposals of February 21, 1981 (Jt. Exh. 11);  (d)
 Mr. Lockhart's letter further stated that, "Doug stated in answer to my
 specific question, that Management was not declaring any proposals
 non-negotiable but that they were just saying that these proposals were
 previously negotiated under NORD" (G.C. Exh. 8), which emphasized that,
 as Mr. Lockhart understood, "proposals" i.e. "these proposals" meant
 NTEU's written proposals;  (e) Mr. Duvall's wholly credible testimony
 that he did not close the door with respect to additional proposals that
 would go to impact or implementation and that had additional proposals
 on impact or implementation been submitted they would have been
 considered;  and (f) the fact that Respondent did negotiate on impact
 and implementation (Proposal No. 5).  Perhaps Mr. Lockhart was left with
 an "impression" that further proposals "would be futile" (Tr. 187);  but
 he made no proposal to test his impression.  Certainly, Mr. Duvall's
 conviction was equally strong, and equally valid, that he had not
 "closed the door" on additional proposals.  In the absence of a specific
 refusal to bargain there is no basis on which an unfair labor practice
 may be found.  To be sure, Respondent refused to bargain on NTEU's
 Proposals 1 through 4, but for reasons set forth above, Respondent was
 not obligated to bargain on Proposals 1 through 4.
 
    Although not addressed by the parties, I have also considered whether
 the portion of Respondent's letter of February 25, 1981, in which it
 stated, in part, that " . . . further initiatives from NTEU . . .
 concerning reassignment impact and implementation are not negotiable . .
 . ." (Jt. Exh. 12), was relied upon by NTEU as the basis for not
 submitting additional proposals on impact and implementation;  but the
 record does not show any such reliance.  To the contrary, Mr. Lockhart
 made it clear that his "impression" was the result, solely, of Mr.
 Duvall's response to his two questions concerning NTEU's written
 proposals.
 
    While I have found that the evidence affirmatively shows that Mr.
 Lockhart directed his question concerning adverse impact bargaining to
 NTEU's written proposals, alternatively, the preponderance of the
 evidence fails to demonstrate that Respondent refused to negotiate on
 the impact of its decision by foreclosing submission of additional
 proposals addressing impact.  It is conceded that NTEU did not make or
 submit any proposal other than its written proposals of February 21,
 1981;  Mr. Duvall's testimony that he did not "close the door" to
 additional proposals on March 6, 1981, was unequivocal;  and, at most,
 Mr. Lockhart professed an "impression" that submission of additional
 proposals would be futile, notwithstanding that the parties did, in
 fact, bargain as to impact and implementation with regard to NTEU's
 Proposal No. 5.
 
    Having found that Respondent did not refuse to bargain in good faith
 as required by the Statute, it is recommended that the Authority adopt
 the following:
 
                                   ORDER
 
    The Complaint in Case No. 7-CA-1070 be, and the same is hereby,
 dismissed.
 
                                       WILLIAM B. DEVANEY
                                       Administrative Law Judge
 
 Dated:  October 4, 1982
         Washington, D.C.
 
 
 
 
 
 
 --------------- FOOTNOTES$ ---------------
 
 
    /1/ The Charging Party's exceptions were untimely filed and therefore
 have not been considered.
 
 
    /2/ The Authority specifically adopts the Judge's finding that the
 Charging Party waived its right to bargain over the lateral reassignment
 of employees within a post of duty, even where no roster had been
 established and no vacancy announcements had been posted.  We find it
 unnecessary, in the circumstances of this case, to distinguish between
 the nature of the bargaining obligations arising under section
 7106(b)(2) and (3) of the Statute, or to pass upon the Judge's findings
 with respect to the negotiability of the Charging Party's proposals.
 
 
    /3/ For convenience of reference, sections of the Statute hereinafter
 are, also, referred to without inclusion of the initial "71" of the
 Statute reference, e.g., Section 7116(a)(5) will be referred to simply
 as "16(a)(5)."
 
 
    /4/ General Counsel filed a Motion to Correct Transcript which I find
 wholly meritorious, and to which the other parties filed no opposition,
 and it is hereby granted.  In addition, I note a further obvious error
 on page 10 line 17, of the transcript which I correct on my own motion.
 The transcript, is hereby corrected as follows:
 
    Page Line Error Correction
 
    8 10 "succeeded" "preceded"
 
    10 16 "of the" "and"
 
    10 17 "rescinded" "refused"
 
    14 10 "heart" "south"
 
    29 15 "pat" "pay"
 
    37 18 "revision" "division"
 
    48 19 "the state" "estate"
 
    55 7 "regional district" "regions and districts"
 
 
    /5/ Prior to testifying as a rebuttal witness, Mr. Ferris, although
 not an attorney, ably represented NTEU and conducted cross-examination.
 It is an undesirable practice for the same individual to act as
 representative of a party and in the same proceeding to become a witness
 for his party.  Indeed, were Mr. Ferris an attorney, there might be
 ethical questions concerning such action since, as I am fully convinced,
 it was known well in advance that:  (a) Mr. Des Roches would appear as a
 witness;  and (b) that Mr. Ferris would almost certainly testify.
 
    Nevertheless, I recognize that it is sometimes unavoidable for a
 representative to seek to testify.  I permitted Mr. Ferris to testify
 and, since there was no conflict between his testimony concerning the
 parties' action, intention, and decision concerning Article 7, I need
 not decide whether Mr. Ferris' dual capacity affected, in any manner,
 his credibility.
 
    This is not a procedure which I propose to condone or to permit
 except under the most unusual circumstances which I found to pertain in
 this case.
 
 
    /6/ See, also, Department of the Treasury Internal Revenue Service,
 Jacksonville District, Jacksonville, Florida, Case No. 4-CA-446,
 OALJ-81-89 (Chaitovitz, J., April 15, 1981).
 
 
    /7/ Article 29, Section 3, provides:
 
          "The Employer agrees to give affected employees fifteen (15)
       working days written notification of reassignments to a different
       post of duty" (Jt. Exh. 8, p. 28).
 
 
    /8/ It was for this underscored concession by IRS that Mr. Ferris
 testified,
 
          " . . . We made that deal (Emphasis supplied, Tr. 180-181).
 
          " . . . we permitted IRS to laterally reassign while a
       promotional roster was in existence.  That right was granted in
       return for the first consideration right. . . . " (Tr. 161-162).
 
 
    /9/ G.C. Exhibit 2 appears to show a name, Mr. Ron Metcalfe, as
 having been deleted.  Counsel for General Counsel stated that Mr.
 Metcalfe's name has not been deleted, that this was simply highlighting
 marks" Mr. Metcalfe was, and is part of Group 1225 (Tr. 26).
 
 
    /10/ Ms. Linda Robbins testified that she had stated that she was
 interested in working in the Tax Shelter Group " . . . if I could be
 assigned to a Boulder place of duty" (Tr. 20);  that when she was
 informed in early March 1981, that she would be assigned to Group 1225,
 which would be located in the Denver Office, she filed a grievance,
 dated March 23 and an amended grievance dated March 27, 1981, which was
 settled at a meeting on April 8, 1981, pursuant to which, " . . . I
 could work in the Boulder Office" (Tr. 22).
 
 
    /11/ The parties do not separately address the Preamble, and, since
 it, like proposals 6, 7, and 8, is significant as a bargaining demand
 only in the context of an "agreement", it may be unnecessary to consider
 it further.  I include it only because it directly states the purpose
 and objective of NTEU.
 
 
    /12/ Sec. 17(c)(1) of the Statute provides, in part, that:
 
          " . . . if an agency . . . alleges that the duty to bargain . .
       . does not extend to any matter, the exclusive representative may
       appeal the allegation to the Authority. . . ."
 
          Sec. 17(c)(3) of the Statute provides, in part, that:
 
          "(3) On or before the 30th day after the . . . receipt . . . of
       the petition . . . the agency shall -
 
          "(A) file with the Authority a statement - " . . .
 
          "(ii) setting