21:0090(18)NG - AFGE, Local 3477 and Commodity Futures Trading Commission -- 1986 FLRAdec NG



[ v21 p90 ]
21:0090(18)NG
The decision of the Authority follows:


 21 FLRA No. 18
 
 AMERICAN FEDERATION OF 
 GOVERNMENT EMPLOYEES, 
 AFL-CIO, LOCAL 3477
 Union
 
 and
 
 COMMODITY FUTURES 
 TRADING COMMISSION
 Agency
 
                                            Case No. 0-NG-681
 
                DECISION AND ORDER ON NEGOTIABILITY ISSUES
 
    I.  Statement of the Case
 
    This case is before the Authority because of a negotiability appeal
 filed under section 7105(a) (2) (E) of the Federal Service
 Labor-Management Relations Statute (the Statute) and Presents issues
 concerning the negotiability of three Union proposals.
 
    II.  Procedural Issue
 
    The Agency contends that the Union's petition for review was untimely
 filed.  Contrary to the Agency's contention, the Authority finds that
 the petition was timely submitted with respect to the Union's written
 request for a written allegation of nonnegotiability.  Under section
 2424.3 of the Authority's Rules and Regulations, a union has the right
 to request in writing that an agency serve it with such written
 allegation.  American Federation of Government Employees, AFL-CIO, Local
 3355 and Federal Home Loan Bank Board, District 7, Chicago, Illinois, 7
 FLRa 395 (1981).
 
    III.  Union Proposal 1
 
       Percentage of award based on the employee's salary shall range as
       follows:  Annual Performance Rating Range Outstanding 10% to 15%
       Superior 5% to 10%
 
    A. Positions of the Parties
 
    The Agency contends that the Proposal is nonnegotiable because it
 conflicts with management's right to determine its budget under section
 7106(a) (1) of the Statute.  The Agency also argues that the proposal is
 inconsistent with 5 U.S.C. 4502 and 4503.
 
    The Union contends that the proposal is not inconsistent with
 management's right to determine its budget.  The Union also contends
 that the proposal is not inconsistent with 5 U.S.C. 4502 and 4503.
 
    B. Analysis
 
    1. Management rights
 
    Under existing Authority precedent, we find that the proposal is
 nonnegotiable for reasons other than those alleged by the Agency.  In
 particular, Union Proposal 1 would establish a range of percentages of
 salary for the purpose of determining the amount of an award given for
 employee performance.  Because this proposal would substantively affect
 the rate of a performance-related award, it has the same effect as Union
 Proposal 5 in National Treasury Employees Union and Internal Revenue
 Service, 14 FLRA 463 (19B4), appeal docketed sub nom.  National Treasury
 Employees Union v. FLRA, No. 84-1292 (D.C. Cir. July 9, 1984).  In that
 case the Authority found that a Proposal which would establish the rate
 of a monetary incentive for performance directly interfered with
 management's rights to direct employees and to assign work under section
 7106(a) (2) (A) and (B).
 
    Because this proposal concerns awards for employee performance,
 however, it is different from Union Proposals?  and 3 in this case.
 Performance based incentive awards relate to an employee's
 accomplishment with respect to his or her job requirements.  Performance
 awards are, therefore, ultimately based in management's right to
 determine those employee job requirements.  Incentive awards granted for
 suggestions relate to an employee's voluntary participation in an agency
 suggestion program.  See Federal Personnel Manual, Chapter 451.  In
 determining whether a proposal prescribing the amount or range of
 amounts of incentive awards is negotiable, therefore, the Authority
 looks to see whether the award is ultimately based in the exercise of a
 management right, as is the case with performance awards.  Compare
 National Treasury Employees Union, Chapter 207 and Federal Deposit
 Insurance Corporation, Washington, D.C., 14 FLRA 598, 6D1-4 (1984)
 (Union Proposal 2), appeal docketed as to other matters sub nom.
 National Treasury Employees Union v. Federal Labor Relations Authority,
 No. 84-1286 (D.C. Cir. july 6, 1984), in which the Authority held a
 proposal establishing the amount of a suggestion award to be within the
 duty to bargain.
 
    C. Conclusion
 
    For the reasons more fully set forth in our decision in the Internal
 Revenue Service case cited above, Union Proposals not within the duty to
 bargain.  Moreover, for the reasons discussed below in connection with
 Union Proposals 2 and 3, we find that Union Proposal 1 does not
 interfere with management's right to determine its budget and is not
 inconsistent with 5 U.S.C. 4502 and 4503.
 
    IV.  Union Proposals and 2 and 3
 
 
The minimum cash award will be $37.50 for adopted suggestions
      resulting in tangible benefits of $250.00.  

      .     .     .     .     .

      Benefits to Government           Amount of Award 

      up to $10,000                    15% of benefits 

      $10 - 100 thousand               $1500 plus 5% over 
                                       $10 thousand

      over $100 thousand               $5000 plus 5% over
                                       $100 thousand


    A. Positions of the Parties
 
    In addition to the arguments raised in connection with Union Proposal
 1, the parties are in dispute as to whether Union Proposals 2 and 3 are
 also nonnegotiable because they are inconsistent with management's
 right, under section 7106(b) (1), to determine the methods, means and
 technology of performing its work.
 
    B. Analysis
 
    1. Management rights
 
    As explained by the Union, Union Proposals 2 and 3 would leave to the
 discretion of the Agency the decision as to whether to grant an award;
 however, once the decision to grant such an award was made the terms of
 the proposal would apply with respect to determining the amount of the
 award.
 
    In American Federation of Government Employees, AFL-CIO and Air Force
 Logistics Command, Wright-Patterson Air Force Base, Ohio, 2 FLRA 603
 (198D), enforced as to other matters sub nom.  Department of Defense v.
 Federal Labor Relations Authority, 659 F.2d 1140 (D.C. Cir. 1981), cert.
 denied sub nom.  AFGE v. FLRA, 455 U.S. 945 (1982), the Authority stated
 generally that it would find a proposal inconsistent with an agency's
 right to determine its budget if the proposal by its terms prescribed a
 particular program or an amount of funds to be included in the agency' s
 budget or if the agency made a substantial demonstration that the
 proposal would result in a significant and unavoidable increase in costs
 which would not be offset by compensating benefits.  Union proposals 2
 and 3 prescribe neither a particular program /1/ nor an amount of funds
 to be included in a budget.  Assuming, as the Agency contends, that it
 would be required by the proposals to budget larger amounts for its
 incentive awards program, it has not demonstrated that such increase,
 would not be offset by compensating benefits.  In fact, the proposals
 would specifically link the amount of an award to the amount of benefits
 to the government which resulted from the suggestion being rewarded.
 
    Nor can the Agency's assertion that the proposals would interfere
 with its right under section 7106(b) (1) to determine the technology,
 methods, and means of performing work be sustained.  The Agency contends
 that if, because of budgetary restraints, it were unable to provide an
 award in the amount specified by the proposals, it would be prevented
 from implementing a suggestion which could involve worthwhile
 improvements to the technology, methods, and means of performing work.
 The Agency's assertion that its inability to provide a specified award
 would preclude implementation of suggested improvements to technology,
 methods, and means is not persuasive.  An employee whose suggestion is
 adopted has the right to be considered for an award and an agency is not
 bound to grant an award upon adoption of a suggestion.  Federal
 Personnel Manual, Chap. 451, Subchap. 8-5;  see also Stephen L.
 Kempinski v. The United States, 164 Ct.Cl. 451 (1964), Cert. denied, 377
 U.S. 981 (1964).
 
    2. Inconsistent with Federal Law
 
    Finally, the Agency contends that the proposals are contrary to the
 provisions of 5 U.S.C. 4502 and 4503, which it describes as reserving to
 the head of each agency the right to determine the amount of each
 incentive award.  Those statutory provisions vest agencies with the
 discretion to, among other things, determine the amount to be paid as
 awards for suggestions.  /2/ The Authority has held that to the extent
 that an agency has discretion with respect to a matter affecting the
 conditions of employment of its employees, that matter is within the
 duty to bargain.  National Treasury Employees Union, Chapter 6 and
 Internal Revenue Service, New Orleans District, 3 FLRA 748 (1980).
 Absent any indication that the discretion provided to agency heads in 5
 U.S.C. 4502 and 4503 is intended to be sole and exclusive, the Agency's
 position cannot be sustained.
 
    C. Conclusion
 
    For the foregoing reasons we find that Union Proposals 2 and 3 do not
 directly interfere with management's rights to determine its budget or
 to determine the methods, means, or technology of performing its work.
 We also find that Union Proposals 2 and 3 are not inconsistent with 5
 U.S.C. 4502 and 4503.
 
    V. Order
 
    Accordingly, pursuant to section 2424.10 of the Authority's Rules and
 Regulations, IT IS ORDERED that the Union's petition for review be, and
 it hereby is, dismissed with respect to Union Proposal 1. IT IS FURTHER
 ORDERED that the Agency shall upon request (or as otherwise agreed to by
 the parties) bargain on Union Proposals 2 and 3.  /3/
 
 Issured, Washington, D.C., March 20, 1986

                            Jerry L. Calhoun,      Chairman

                            Henry B. Frazier III.  Member

                            Federal Labor Relations Authority



 
 --------------- FOOTNOTES$ ---------------
 
 
 
    /1/ Agencies are required pursuant to 5 CFR 451.205(a) (3) (1984
 Supp.) to allocate "an adequate budget" to assure prompt action on
 incentive awards.
 
 
    /2/ Those sections provide as follows:
 
    4502. General provisions
 
    (a) Except as provided by subsection (b) of this section, a cash
 award under this subchapter may not exceed $10,000.
 
    (b) When the head of an agency certifies to the Office of Personnel
 Management that the suggestion, invention, superior accomplishment, or
 other meritorious effort for which the award is proposed is highly
 exceptional and unusually outstanding, a cash award in excess of $10,000
 but not in excess of $25,000 may be granted with the approval of the
 Office.
 
    (c) A cash award under this subchapter is in addition to the regular
 may of the recipient.  Acceptance of a cash award under this subchapter
 constitutes an agreement that the use by the Government of an idea,
 method, or device for which the