25:0837(69)NG - NTEU and Treasury, IRS -- 1987 FLRAdec NG



[ v25 p837 ]
25:0837(69)NG
The decision of the Authority follows:


 25 FLRA No. 69
 
 NATIONAL TREASURY EMPLOYEES UNION
 Union
 
 and
 
 DEPARTMENT OF THE TREASURY 
 INTERNAL REVENUE SERVICE
 Agency
 
                                            Case No. 0-NG-1244
 
                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 concerns the
 negotiability of three proposals.  We find all three proposals to be
 negotiable.
 
                              II.  Proposal 1
 
          The Service shall maintain its current practices of
       hand-delivering employees' paychecks, earning statements, etc.
 
          Proposal 2
 
          Employees may designate any address, including the address of
       the employees' post-of-duty, (temporary or permanent), for the
       mail distribution of paychecks, earning statements, etc.
 
          Proposal 3
 
          Paychecks received in an IRS office's mail will be distributed
       immediately if possible.  If immediate distribution is not
       possible, the employees will be informed that:
 
          a.  Their paychecks have arrived in the mail;
 
          b.  Distribution is not immediately possible;
 
          c.  The reason(s) distribution is not immediately possible;
       and
 
          d.  Employees desiring to pick up their paychecks, earning
       statements etc. from the mail room (or any place designated by
       IRS) will receive administrative time to pick up their paychecks,
       earning statements, etc.
 
                       A.  Positions of the Parties
 
    These proposals were submitted by the Union following the Agency's
 decision to terminate hand delivery of paychecks and savings bonds to
 employees.  Under the Agency's new policy employees are to choose
 between direct deposit or mail delivery as their method of paycheck and
 savings bond delivery.  The Agency claims without contravention that the
 portions of the proposals concerning the hand delivery of leave and
 earnings statements are not in dispute as these statements continue to
 be distributed by hand.  Agency Statement of Position at 3.  As to the
 requirement for hand delivery of paychecks, the Agency contends that all
 three proposals interfere with its rights to assign work, under section
 7106(a)(2)(B) of the Statute, to determine its internal security
 practices, under section 7106(a)(1), and to determine its methods and
 means of performing work, under section 7106(b)(1).  The Agency also
 contends that all three proposals conflict with an Agency-wide
 regulation for which a compelling need exists under section 7117(a)(2)
 of the Statute, and that Proposals 2 and 3 do not constitute appropriate
 arrangements for adversely affected employees, under section 7106(b)(3).
 
    The Union states that Proposal 1 is intended to require the Agency to
 maintain its practice of allowing its employees to receive paychecks by
 hand-delivery at their official work locations.  Proposals 2 and 3 were
 submitted as interim procedures in the event that Proposal 1 was
 declared nonnegotiable.  The Union contends that paycheck distribution
 is a working condition, under section 7103(a)(14), and does not fall
 within any of the statutory exemptions from bargaining under section
 7106 of the Statute.  It also contends that there is no compelling need
 for the Agency's regulation and that the proposals, therefore, are not
 barred from negotiations under section 7117(a)(2).  Finally, the Union
 asserts that in the event the Authority finds that the proposals
 interfere with management's rights, Proposals 2 and 3 constitute
 appropriate arrangements for employees adversely affected by the
 exercise of these rights, under section 7106(b)(3) of the Statute.
 
                               B.  Analysis
 
        1.  Assignment of Work and Methods and Means of Performing
 
                Work
 
    In the Authority's recent Decision and Order on Remand in Federal
 Employees Metal Trades Council, AFL-CIO and Department of the Navy, Mare
 Island Naval Shipyard, Vallejo, California, 25 FLRA No. 31 (1986) /1/ we
 reconsidered and reversed the Authority's prior holding that two
 proposals concerning paycheck delivery involved the methods and means of
 performing work and, thus, were negotiable only at the election of the
 Agency under section 7106(b)(1) of the Statute.  In our decision on
 remand we determined, among other things, that the manner of paycheck
 delivery did not involve the methods and means of performing work under
 section 7106(b)(1) but rather, related principally to conditions of
 employment under section 7103(a)(14).
 
    The proposals in this case also concern the manner of paycheck
 delivery.  In addition, the Agency in this case similarly claims that
 the proposals involve the methods and means of performing work under
 section 7106(b)(1) because they determine the kind of payroll system the
 Agency will use.  However, based on the reasons fully set forth in Mare
 Island Naval Shipyard, we conclude that the proposals in this case do
 not interfere with management's right to determine the method and means
 of performing work under section 7106(b)(1).
 
    We turn now to the Agency's contention that the proposals interfere
 with its right to assign work under section 7106(a)(2)(B).  In support,
 the Agency claims that these proposals require it to assign specific
 duties, namely, duties related to the hand delivery of paychecks, which
 duties are no longer performed since the hand delivery of paychecks was
 eliminated.  Essentially the same argument was raised by the agency in
 Mare Island Naval Shipyard.  In rejecting the agency's claim in that
 case we noted that under the agency's new paycheck delivery policy some
 employees would continue to be permitted to have paychecks delivered by
 hand.  Thus, we found that the proposals in that case did not require
 the agency to assign duties that would not otherwise be assigned.
 Similarly, in this case, the Agency's regulation contemplates that some
 employees will continue to have paychecks delivered by hand. Agency
 Statement of Position at 3.  Since the proposals in this case likewise
 do not require the Agency to assign duties that would not otherwise be
 assigned they do not interefere with management's right to assign work
 under section 7106(a)(2)(B) of the Statute.
 
              2.  Internal Security Under Section 7106(a)(1)
 
    The Agency contends that its policy with respect to hand delivery of
 paychecks and savings bonds is part of its plan to secure its physical
 property against internal or external risks.  In support, the Agency
 argues as follows:  Checks are like any other property used to satisfy
 governmental obligations;  if a check issued to a payee is lost or
 stolen without the fault of the payee there is a legal obligation to
 issue a replacement check;  and therefore, the Agency's interest in
 securing its obligations in the form of negotiable instruments or checks
 is equivalent to its interest in securing any other governmental
 property.  In our view, these arguments standing alone do not establish
 the connection between its policy of terminating hand delivery of
 paychecks and savings bonds and the safeguarding of its property against
 internal or external risks.  For example, the Agency has not established
 that its obligation to issue a replacement check depends on whether the
 first check was lost in the mail or stolen from an employee's mailbox or
 lost or stolen at the employee's worksite.  Moreover, as the Union
 points out, hand delivery of paychecks may actually reduce the
 obligation of the Agency to have replacement checks issued for those
 employees who live in areas where mailboxes are frequently vandalized.
 Union Reply Brief at 6.  Thus, we cannot sustain the Agency's contention
 that the proposals interfere with its right to determine its internal
 security practices.
 
                            3.  Compelling Need
 
    As to the Agency's compelling need contention, it asserts that a
 compelling need exists under section 2424.11(a) of the Authority's rules
 and regulations for a Department of Treasury directive mandating the
 mailing of paychecks and savings bonds to employees.  In support, the
 Agency refers to two independent studies which it claims demonstrate a
 saving of over $1.00 per paycheck for a total saving of $297,000
 resulting from the elimination of hand delivery of paychecks and an
 additional saving of $68,000 resulting from the elimination of hand
 delivery of savings bonds.  On the basis of these projected savings the
 Agency relies on the Authority's decision in National Association of
 Government Employees, Local R14-62 and U.S. Army Dugway Proving Ground,
 Dugway, Utah, 18 FLRA No. 38 (1985), remanded sub nom. National
 Association of Government Employees, Local R14-62 v. FLRA, No. 85-2098
 (10th Cir. Order November 19, 1986) where the Authority found a
 compelling need under section 2424.11(a) for an agency-wide regulation
 requiring employees to take annual leave during periods when the agency
 facilities were partially closed.  In that case the Authority determined
 that the agency had demonstrated that its regulation was a critical
 component of the agency's achieving its objective of saving money by
 curtailing operations so as to insure the agency's performance of its