21:0233(32)NG - NFFE Local 29 and Army, Kansas City District, Army Corps of Engineers, Kansas City, MO -- 1986 FLRAdec NG

 21 FLRA No. 32
 
 NATIONAL FEDERATION OF FEDERAL 
 EMPLOYEES, LOCAL 29
 Union
 
 and
 
 DEPARTMENT OF THE ARMY, 
 KANSAS CITY DISTRICT, 
 U.S. ARMY CORPS OF ENGINEERS, 
 KANSAS CITY, MISSOURI
 Agency
 
                                            Case No. 0-NG-731
 
                DECISION AND ORDER ON NEGOTIABILITY ISSUES
 
    I.  Statement of the Case
 
    This case is before the Authority because of a negotiability appeal
 under section 7105(a)(2)(E) of the Federal Service Labor-Management
 Relations Statute (the Statute) and concerns the negotiability of three
 Union proposals.
 
    II.  Union Proposal 1
 
       The Employer recognizes that all employees have a statutorily
       created right to their pay, retirement fund and annuities derived
       therefrom.  The Employer further recognizes that
       charges/allegations of pecuniary liability shall not be construed
       to be indebtedness or appears to the United States until the
       affected employee has had the opportunity to fully exercise
       his/her rights of due process;  wherein due process shall provide
       equal protection to all employees and shall require a hearing
       before an unbiased, unprejudiced and impartial tribunal, free from
       any command pressure or influence.  All claims by the Government
       for pecuniary liability shall be capped at a maximum of $150.00.
       Only the underlined portion is in dispute.)
 
    A. Positions of the Parties
 
    Union Proposal 1 would limit an employee's liability for the loss,
 damage to or destruction of government property to $150.00, whereas,
 under the Agency's existing regulations, an employee's liability is now
 limited to an employee's basic monthly pay.  The Agency has refused to
 negotiate over the proposal contending that the proposal is inconsistent
 with the Federal Claims Collection Act of 1966 ("Claims Act"), Pub.L.
 No. 89-508, 80 Stat. 309 (1966) and violates its management right to
 determine its internal security practices pursuant to section 7106(a)(1)
 of the Statute.
 
    The Union disputes the Agency's contentions.
 
    B. Analysis
 
    1. Management Rights
 
    In agreement with the Agency, the Authority finds that the proposal
 violates the Agency's right to establish its internal security practices
 pursuant to section 7106(a)(1) of the Statute.  An agency's right to
 determine its internal security practices includes those policies and
 actions which are part of the agency's plan to secure or safeguard its
 physical property against internal or external risks, to prevent
 improper or unauthorized disclosure of information, or to prevent the
 disruption of the agency's activities.  See American Federation of
 Government Employees, AFL-CIO, Local 32 and Office of Personnel
 Management, Washington, D.C., 14 FLRA 6 (1984) (Union Proposal 2),
 appeal docketed sub nom.  Federal Labor Relations Authority v. Office of
 Personnel Management, No. 84-1325 (D.C. Cir. July 18, 1984).  The
 Agency's plan as set forth in its regulation provides that an employee's
 pecuniary liability will be one month's pay or the amount of the loss to
 the Government, whichever is less.  The Agency contends that this
 regulation acts as a deterrent and encourages employees to exercise due
 care when dealing with government property.  Hence, it constitutes a
 management plan which is intended to eliminate or minimize risks to
 government property by making clear the consequences of property
 destruction, loss or damage, and is within the Agency's right to
 determine its internal security practices.  /1/
 
    Even if, as the Union argues, the Agency's plan is designed primarily
 as a means of recouping government loss, in the Authority's view the
 Agency's statutory authority includes determining that the plan has,
 also, the effect of minimizing the risk of the loss occurring in the
 first place.  Similarly, the Union's argument that the Agency's plan is
 not an effective deterrent is beside the point.  It is not appropriate
 for the Authority to adjudge the relative merits of the Agency's
 determination to adopt one from among various possible internal security
 practices, where the Statute vests the Agency with authority to make
 that choice.  In this regard, the Union's contention that its proposal
 limiting liability to $150.00 is merely a procedural proposal under
 section 7106(b)(2) of the Statute is not persuasive.  The proposal
 directly impinges on management's right to establish its internal
 security practices.
 
    2. Inconsistent with Federal Law
 
    The Claims Act specifically states that the Act does not diminish the
 existing authority of a head of an agency to litigate, settle,
 compromise or close claims.  /2/ Pursuant to 10 U.S.C. 4831, et seq.,
 the Secretary of the Army was vested with the existing authority to
 compromise, settle or close claims when the Claims Act was enacted.  /3/
 
    There is no provision in 10 U.S.C. 4831 which limits the Secretary's
 right to settle, compromise or close claims in fulfilling his
 responsibilities under the Act.  We find that insofar as the Secretary
 has unrestricted authority to close, settle and compromise on claims for
 destroyed or damaged property, the Union's proposal is not inconsistent
 with the Claims Act.
 
    C. Conclusion
 
    Based on the arguments of the parties, the Authority finds that Union
 Proposal 1 violates section 7106(a)(1) of the Statute and, thus, is
 outside the duty to bargain.  We also find that the proposal is not
 inconsistent with the Federal Claims Collection Act.
 
    III.  Union Proposal 2
 
       When the Employer determines it is necessary to hold an
       employee(s) liable for loss, damage, or destruction of property,
       the Employer may take appropriate disciplinary action or charge
       the employee pecuniarily liable, but not both.  Under either
       action, the Agency's allegation will only be sustained if the
       Agency proves its charge with a preponderance of evidence.  Any
       disciplinary action taken will be in accordance with applicable
       laws and higher authority regulation and the negotiated Agreement.
        If the Employer decides to hold the employee pecuniarily liable,
       the Employer will provide the employee a hearing before an
       arbitrator.  (Only the un