21:0178(28)NG - AFGE, Local 1923 and HHS, Office of the Secretary, HQ, Office of the General Counsel, SS Division -- 1986 FLRAdec NG



[ v21 p178 ]
21:0178(28)NG
The decision of the Authority follows:


 21 FLRA No. 28
 
 AMERICAN FEDERATION OF GOVERNMENT 
 EMPLOYEES, LOCAL 1923, AFL-CIO
 Union
 
 and
 
 DEPARTMENT OF HEALTH AND HUMAN 
 SERVICES, OFFICE OF THE SECRETARY
 HEADQUARTERS, OFFICE OF THE GENERAL 
 COUNSEL, SOCIAL SECURITY DIVISION
 Agency
 
                                            Case No. 0-NG-557
 
                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)(D) and (E) of the Federal Service
 Labor-Management Relations Statute (the Statute) and concerns the
 negotiability of six Union proposals.  /1/ The proposals concern various
 aspects of performance appraisal systems.
 
    II.  Procedural Issue
 
    The Agency moved that the Union's petition be dismissed because it
 was filed by the national office of the Union (AFGE) and not by a
 representative of the local Union (AFGE, Local 1923).  Under section
 7117(c) of the Statute and section 2424.2 of the Authority's Regulations
 a negotiability appeal must be filed by an exclusive representative.
 Nothing in either the Authority's Regulations or the Statute precludes
 the exclusive representative from designating an agent to file an appeal
 on its behalf.  The designation of a representative for purpose of
 appeal to the Authority is strictly a matter for the Union to decide.
 American Federation of Government Employees, AFL-CIO, Local 3028 and
 Department of Health and Human Services, Public Health Service, Alaska
 Area Native Health Service, 13 FLRA 697 (1984).  The Agency's motion to
 dismiss is denied.
 
    III.  Union Proposal 1
 
       Section 2.A The Administration has the right to establish critical
       elements, non-critical elements, and performance standards,
       subject to law, regulation and this Agreement.
 
    A. Positions of the Parties
 
    The Agency contends that Union Proposal 1 is outside the duty to
 bargain under section 7117(a)(2) of the Statute because the Authority
 has not determined that there is no compelling need for a conflicting
 agency regulation.
 
    The Union contends that the proposal merely establishes that the
 Agency's performance appraisal system will recognize applicable
 provisions of the parties' agreement, and does not conflict with
 internal agency regulations for which there is a compelling need.
 
    B. Analysis and Conclusion
 
    As a general matter, the Authority has consistently held that general
 provisions requiring management to exercise its statutory rights under
 section 7105 in compliance with law are within the duty to bargain.  See
 National Federation of Federal Employees, Local 1497 and Department of
 the Air Force, Lowry Air Force Base, Colo., 9 FLRA 151-(1982) (Union
 Proposal 2).  See also American Federation of Government Employees,
 AFL-CIO, National Council of EEOC Locals and Equal Employment
 Opportunity Commission, 10 FLRA 3 (1982) (Union Proposal 1), enforced
 sub nom.  Equal Employment Opportunity Commission v. Federal Labor
 Relations Authority, 744 F.2d 842 (D.C. Cir. 1984);  cert. granted, 105
 S.Ct. 3497 (1985).  The Authority has also held that management's
 identification of critical elements and the establishment of performance
 standards constitute exercises of the rights to direct employees and
 assign work under section 7105(a)(2)(A) and (B) of the Statute.
 National Treasury Employees Union and Department of the Treasury, Bureau
 of the Public Debt, 3 FLRA 769 (1980), aff'd sub nom.  National Treasury
 Employees Union v. Federal Labor Relations Authority, 591 F.2d 553 (D.C.
 Cir. 1982).  Further, the Authority has held that a proposal
 incorporating specific restrictions from a Government-wide regulation
 directly interfered with a management right because it imposed the
 provisions of the regulation as substantive contractual limitations
 without regard to the regulation's possible subsequent revision or
 elimination.  National Federation of Federal Employees, Local 1157 and
 Department of the Air Force, Headquarters, 31st Combat Support Group
 (TAC), Homestead Air Force Base, Florida, 6 FLRA 574 (1981) (proposal
 2), affirmed as to other matters sub nom.  NFFE, Local 1167 v. FLRA, 681
 F.2d 886 (D.C. Cir. 1982):  However, this proposal would not limit
 management or impose substantive contractual limitations but would only
 require the Agency to adhere to any requirements which are in effect at
 the time the Agency identifies critical elements and establishes
 performance standards.
 
    The Agency's sole contention is that the duty to bargain in good
 faith extends to matters like this one covered by Department-level rule
 or regulation only if the Authority has determined that no compelling
 need exists for the rule or regulation.  The compelling need provisions
 of the Statute are meant to insure that otherwise negotiable, bargaining
 proposals are taken outside the duty to bargain only if the agency
 involved demonstrates and justifies an overriding need for the policies
 reflected in the rules or regulations to be uniformly applied throughout
 the agency.  American Federation of Government Employees, AFL-CIO, Local
 38-54 and Federal Deposit Insurance Corporation, Chicago Region,
 Illinois, 7 FLRA 217, 220 (1981).  Therefore, an agency must (1)
 identify a specific agency-wide regulation;  (2) show that there is a
 conflict between its regulation and the proposal;  and (3) demonstrate
 that its regulation is supported by a compelling need with reference to
 the Authority's standards set forth in section 2424.11 of its
 Regulations.  See American Federation of Government Employees, AFL-CIO,
 Local 1928 and Department of the Navy, Naval Air Development Center,
 Warminster, Pennsylvania, 2 FLRA 450, 454 (1980).
 
    The Agency here has failed to identify or submit to the Authority the
 specific provision of internal agency rule or regulation upon which it
 relies.  It contends only that its Personnel Manual generally bars
 negotiation over this proposal.  The Authority finds that the Agency has
 failed to support its implicit allegation that the Union's proposal is
 barred from negotiations because it conflicts with an internal agency
 rule or regulation for which a compelling need exists.  Id. at 454-55.
 The Authority concludes that Union Proposal 1 is within the duty to
 bargain.
 
    IV.  Union Proposals 2 & 3
 
       Union Proposal 2:  Section 2.B, Step 5 The critical and
       non-critical elements and individual performance standards will be
       communicated to bargaining unit employees on the negotiated
       performance evaluation form, prior to the appraisal period.  Union
       Proposal 3:  Section 4.C In addition to assessing the employee's
       performance on individual elements, as in "A" above, the
       supervisor will evaluate the employee's overall job performance by
       summarizing the performance on the negotiated form, using one of
       the following five summary ratings:  1. Unsatisfactory.  This
       appraisal applies if the employee failed to meet one or more
       critical job elements regardless of performance on non-critical
       job elements.  2. Minimally Satisfactory.  This appraisal applies
       if the employee only partially met one or more critical job
       elements or if the employee fully met all critical job elements
       but failed to fully meet a substantial number of non-critical job
       elements.  3. Fully Satisfactory.  This appraisal applies if the
       employee, at a minimum, fully met all critical job elements and
       virtually all non-critical job elements or it the employee
       exceeded all of the critical job elements and fully met a
       substantial number of non-critical job elements.  4. Excellent.
       This summary appraisal applies if the employee exceeded all of the
       critical elements and virtually all of the non-critical job
       exceeded all of the employee substantially exceeded all critical
       job elements and fully met a substantial number of non-critical
       job elements.  5. Outstanding.  This summary appraisal applies if
       the employee substantially exceeded all critical job elements and
       virtually all non-critical job elements.  (All of Proposal 2 and
       the underscored portion of Proposal 3 are in dispute.)
 
    A. Positions of the Parties
 
    The Agency contends that Union Proposals 2 and 3 conflict with an
 internal agency regulation which requires the use of a standard form by
 requiring the use of a negotiated performance evaluation form instead.
 It argues that a compelling need exists for this regulation and that the
 proposals are, therefore, outside the duty to bargain under section
 7117(a)(2) of the Statute.  In addition, the Agency contends that by
 requiring a "negotiated form" the proposals in essence require
 negotiation on performance standards and are outside the duty to bargain
 for that reason also.
 
    The Union contends that Proposals 2 and 3 constitute negotiable
 procedures that do not conflict with the Agency's regulation.  It
 further argues that even if there was a conflict the Agency has not
 established a compelling need for its regulation.
 
    B. Analysis
 
    1. Compelling Need
 
    The Agency bears the burden of demonstrating a compelling need for
 its regulatory requirement that there be uniform Agency-wide use of its
 evaluation form.  See discussion of Union Proposal 1. The Authority's
 illustrative standard for determining compelling need in section
 2424.11(a) of its Regulations requires an agency to demonstrate that the
 rule or regulation upon which it relies is "essential as distinguished
 from helpful or desirable" to achieve certain ends.  See American
 Federation of Government Employees, AFL-CIO, Local 2875 and Department
 of Commerce, National Oceanic and Atmospheric Administration, National
 Marine Fisheries Service, Southeast Fisheries Center, Miami Laboratory,
 Florida, 5 FLRA 441 (1981).
 
    The Agency asserts that its requirement to use a standard form is
 essential to accomplishment of its mission or execution of its functions
 in a manner consistent with the requirements of an effective and
 efficient government.  Its arguments in this regard all relate to its
 need to maintain control of the content and format of performance
 evaluation forms.  It claims this control can only be achieved through
 uniform use of the form designated as 430-4-B set forth in HHS
 Instruction 430-4.  The Union states that the information claimed by the
 Agency to be necessary is to be included on any negotiated appraisal
 form.  Union Reply Brief at 4. The Agency itself indicates that the
 negotiated form would not be substantively different from and would
 contain the "same information" as its own form.  Agency Statement of
 Position at 3. Since the negotiated performance evaluation form will
 contain essentially the same information as the Agency's own form, the
 Agency's assertion that use of its form is essential cannot be
 sustained.
 
    2. Management Rights
 
    Turning to the Agency's argument that the proposals violate
 management rights because they would in essence require bargaining on
 performance standards, the Authority has held as a general matter that
 proposals which are otherwise consistent with law and regulation and
 relate only to particular aspects of performance appraisal systems,
 apart from the identification of critical elements and the establishment
 of performance standards, are within the duty to bargain.  National
 Treasury Employees Union and Department of the Treasury, Bureau of the
 Public Debt, 3 FLRA 769, 780 (1980), aff'd sub nom.  National Treasury
 Employees Union v. Federal Labor Relations Authority, 631 F.2d 553 (D.C.
 Cir. 1982).  Similarly, proposals which establish procedures for the
 development and implementation of performance standards and critical
 elements, or which establish appropriate arrangements for employees
 adversely affected by the application of performance standards critical
 elements to them, are within the duty to bargain under section
 7106(b)(2) and (3) of the Statute.  Id.
 
    If the Union proposals did require the Agency to negotiate concerning
 the definitions of its performance standards they would, of course, be
 outside the duty to bargain under section 7106(a)(2)(A) and (B) of the
 Statute.  See discussion of Union Proposal 1. However, nothing in the
 disputed language of the proposals nor in Union statements in the record
 lends support to the Agency's contention that the proposal's requirement
 that a negotiated form be used amounts to negotiation on the definitions
 of its performance standards.  The Union specifically states that the
 definitions contained in the Agency's form would not be affected by
 these proposals.  Union Reply Brief at 4-5.  Since the Union is not
 attempting to negotiate on those definitions, the Agency's argument that
 the definitions are nonnegotiable is inapplicable to bar negotiations on
 Union Proposals 2 and 3.
 
    C. Conclusion
 
    Because the Agency has not demonstrated that its regulation is
 supported by a compelling need, it does not bar negotiation on Union
 Proposals 2 and 3. Further, the disputed portions of these proposals are
 not inconsistent with management rights under section 7106(a)(2) of the
 Statute.  Union Proposals 2 and 3 establish procedures relating to the
 implementation of performance standards and critical elements.  They are
 within the duty to bargain under section 7106(b)(2) of the Statute.
 
    V. Union Proposals 4 & 5
 
       Union Proposal 4:  Section 6 Performance appraisals will whenever
       possible be prepared annually based on employee performance
       expectations established for the 12 preceding months.  Union
       Proposal 5:  Section 6.B Appraisals are generally due on a regular
       schedule annually but may be postponed under (certain)
       circumstances(.)
 
    A. Positions of the Parties
 
    The Agency contends that Union Proposals 4 and 5 are inconsistent
 with an Agency regulation which provides for performance appraisals to
 occur in January or October of each year and for which a compelling need
 exists.
 
    The Union contends that its proposals do not conflict with the cited
 regulation.
 
    B. Analysis and Conclusion
 
    The Authority has held that prescribing periodic appraisal of
 employees on an annual basis is consistent with law and Government-wide
 rules or regulations and within the duty to bargain.  See American
 Federation of Government Employees, AFL-CIO, Local 1968 and Department
 of Transportation, Saint Lawrence Seaway Development Corporation,
 Massena, New York, 5 FLRA 70 (1981) (Proposal 2), affirmed as to other
 matters sub nom.  AFGE, Local 1968 v. FLRA, 691 F.2d 565 (D.C. Cir.
 1982), cert. denied, 451 U.S. 926 (1983).  The Union here clearly did
 not intend to require anything other than annual performance appraisals
 and did not link the term "annually" in the proposal to any specific
 month when the annual appraisals should occur.  Union Reply Brief at 6.
 The Authority concludes that the proposals do not conflict with the
 Agency's Instruction requiring that annual performance appraisals occur
 in January or October of each year.  In the absence of a conflict
 between the proposals and the Instruction, it is unnecessary to decide
 whether the Agency has demonstrated a compelling need for its
 regulation.  See discussion of Union Proposal 1. The Authority finds
 that Union Proposals 4 and 5 are within the duty to bargain.
 
    VI.  Union Proposal 6
 
       Section 9.C Should remedial action fail and the employee's
       performance continue to be unacceptable after a reasonable
       opportunity to demonstrate improvement, the employee may be liable
       for adverse action under 5 U.S.C. 43.  The appropriate personnel
       action will depend on the following considerations:  1. when the
       employee is capable of performing another position of the same
       grade, the supervisor should propose to reassign the employee to
       such a position;  2. when the employee is not capable of
       performing a position at the same grade but is capable of
       performing a position at a lesser grade, the supervisor should
       propose a demotion to a position at the next lower grade;  3. a
       proposal of separation should only be proposed when the employee
       is determined to be incapable of the performance of any other
       position reasonably available.
 
    A. Positions of the Parties
 
    The Agency contends that Union proposal 6 would prohibit it from
 demoting an employee for unacceptable performance until he or she had
 been given a chance to perform in similar positions of equal grade or
 demoting an employee for unacceptable performance until he or she had
 been given a chance to perform in similar positions of a lower grade.
 The Agency argues that the Union's proposal is contrary to management's
 rights under section 7106(a)(2)(A) of the Statute, including the rights
 to remove or reduce in grade or pay employees in the Agency.
 
    The Union argues that the proposal preserves the Agency's discretion
 to exercise its rights under section 7106(a)(2)(A).  It contends that
 the proposal is a procedure under section 7106(b)(2) of the Statute
 which management will observe in exercising those rights and an
 appropriate arrangement under section 7106(b)(3) of the Statute for
 employees adversely affected by the exercise of management's right to
 take adverse action against employees for unacceptable performance.
 
    B. Analysis and Conclusion
 
    The Authority finds that Union Proposal 5 is substantially identical
 to the proposal which the Authority held to be outside the duty to
 bargain in National Labor Relations Board Union and National Labor
 Relations Board, Office of the General Counsel, 18 FLRA No. 42 (1985).
 In the NLRB case, the Authority found that a proposal which similarly
 would have required the agency to reassign an employee prior to
 terminating or demoting that employee substantively interfered to an
 excessive degree with management's rights under section 7106(a)(2)(A) to
 remove employees or reduce them in grade or pay.  /2/
 
    Additionally, the use of the term "should" in Proposal 6 does not
 make the proposal discretionary rather than mandatory.  Instead, the
 plain language of the proposal would require the Agency in virtually all
 instances to reassign an employee prior to terminating or demoting that
 employee for unacceptable performance contrary to management's rights
 under section 7106(a)(2)(A) of the Statute.  See American Federation of
 Government Employees, AFL-CIO, Local 3483 and Federal Home Loan Bank
 Board, New York District Office, 13 FLRA 446, 450-52 (1983) (rejecting
 union's contention that the phrase "to the extent practicable" removes
 substantive limitation that proposal would have placed on agency's right
 to identify critical elements) and American Federation of Government
 Employees, AFL-CIO, National Border Patrol Council and Department of
 Justice, Immigration and Naturalization Service, 16 FLRA 251, 252 (1984)
 (rejecting union's contention that the phrase "to the maximum extent
 possible" leaves the agency with discretion to exercise its right to
 assign work "without inhibition").
 
    The Authority finds that the Agency has provided insufficient support
 in the record to decide whether Union Proposal 6 violates additional
 management rights under section 7106(a)(2)(A) of the Statute.  However,
 for the reasons set forth in the NLRB case, we find that Union Proposal
 6 is contrary to the Agency's right under section 7106(a)(2)(A) of the
 Statute to remove employees or reduce them in grade or pay for
 unacceptable performance.  We further find that the proposal constitutes
 neither a negotiable procedure under section 7106(b)(2) nor an
 appropriate arrangement under section 7106(b)(3) of the Statute and
 conclude that Union Proposal 6 is outside the duty to bargain.
 
    VII.  Order
 
    Accordingly, pursuant to section 2424.10 of the Authority's Rules and
 Regulations, IT IS ORDERED that the Agency shall upon request (or as
 otherwis