41:0119(14)AR - - Interior, Bureau of Reclamation, Lower CO Dams Project Office, Parker and Davis Dam and IBEW Local 640 - - 1991 FLRAdec AR - - v41 p119



[ v41 p119 ]
41:0119(14)AR
The decision of the Authority follows:


41 FLRA No. 14

FEDERAL LABOR RELATIONS AUTHORITY

WASHINGTON, D.C.

U.S. DEPARTMENT OF INTERIOR

BUREAU OF RECLAMATION

LOWER COLORADO DAMS PROJECT OFFICE

PARKER AND DAVIS DAMS

(Agency)

and

INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS

LOCAL 640

(Union)

0-AR-1936

DECISION

June 11, 1991

Before Chairman McKee and Members Talkin and Armendariz.

I. Statement of the Case

This matter is before the Authority on exceptions to an award of Arbitrator William E. Rentfro filed by the Agency under section 7122(a) of the Federal Service Labor-Management Relations Statute (the Statute) and part 2425 of the Authority's Rules and Regulations.(1) The Union filed an opposition to the Agency's exceptions.

The grievance alleged that the Agency violated the parties' collective bargaining agreement by failing to pay two unit employees a 25 percent premium for nonovertime work performed on Sunday. The Arbitrator sustained the grievance and ordered the Agency to "comply with the Sunday Premium Pay provision in the Contract and reimburse all bargaining unit employees who have performed non-overtime work on Sunday after July 19, 1987." Award at 27-28. The Arbitrator retained jurisdiction to allow the Union to file an application for reasonable attorney fees and to resolve any disputes concerning the implementation of the award.

For the following reasons, we find that the Agency has failed to establish that the award is deficient. Therefore, the Agency's exceptions will be denied.

II. Background and Arbitrator's Award

The employees involved in this case negotiate their wages and premium pay provisions in accordance with section 704 of the Civil Service Reform Act of 1978 (CSRA), codified at 5 U.S.C. § 5343 (Amendments) (1988 ed.) and section 9(b) of the Prevailing Rate Systems Act (PRSA), codified at 5 U.S.C. § 5343 (Amendments, note) (1988 ed.).(2)

The Union filed a grievance over the denial of Sunday premium pay to two unit employees who each worked on a Sunday during July 1987. The parties agreed to submit the grievance to binding arbitration on a stipulation of facts, with exhibits. The parties also submitted separate statements of the issue and briefs to the Arbitrator.

The current basic agreement between the parties was approved in 1983. The Supplementary Wage Schedules in the agreement provide that "employees 'will receive their base pay plus twenty-five (25) percent premium for all nonovertime regularly scheduled Sunday work.'" Award at 2. "The payment of Sunday premium pay was contained in the Supplementary Wage Schedules since at least 1983." Id. at 4.

During negotiations in 1985, 1986, and 1987, the Agency proposed to eliminate Sunday premium pay. In April 1987, the parties agreed in a memorandum of understanding to schedule the issue for arbitration. The record does not reveal the outcome of that proceeding and the issue raised in that proceeding is not before us in this case.

On July 6, 1987, the Agency informed the Union that Sunday premium pay would be discontinued on July 19, 1987. Thereafter, the Union filed a grievance with respect to the Agency's denial of Sunday premium pay for two employees who performed nonovertime work on regularly scheduled Sunday shifts on July 19 and 26, 1987. That grievance was submitted to arbitration.

While that grievance was pending in arbitration, the Agency notified the Arbitrator of the opinion of the United States Court of Appeals for the Ninth Circuit in United States Department of the Interior, Bureau of Indian Affairs, Yakima Agency and the Wapato Irrigation Project v. FLRA, 887 F.2d 172 (9th Cir. 1989), interpreting section 704 of the CSRA. Also, because of the Ninth Circuit's opinion, the Union sought permission to withdraw a portion of the stipulation of facts and requested a hearing. The Arbitrator granted the Union's request and a hearing was scheduled. At the hearing, the Agency's "primary custodian of the records of negotiating sessions with [the Union]" produced evidence of negotiations between the parties on "the subject of 'Sunday premium pay benefit, applicable to Wage Board Employees'" which took place in 1965, 1967, and 1975. Id. at 7-8.

The Arbitrator reframed the issues submitted by the parties as follows:

1. Whether the subject of Sunday Premium Pay was "the subject of negotiations" under the meaning of Section 704 of [the CSRA] prior to August 19, 1972?

2. What is the effect of the stipulation by the parties that Sunday Premium Pay is not a prevailing practice among the companies listed in the agreement for the purpose of determining prevailing basic pay and prevailing pay practices?

3. If termination of the pay practice is not proper, whether the Agency should be required to reinstate the 25% Sunday Premium Pay differential, and reimburse all bargaining unit employees who performed non-overtime work on Sunday, on and after July 19, 1987, the date of discontinuance of such Sunday Premium Pay differential.

Id. at 9.

Concerning the first issue, the Arbitrator stated that "[t]he critical question . . . is whether Sunday Premium Pay was specifically negotiated prior to August 19, 1972." Id. at 12. After a review of the evidence, the Arbitrator found that "the parties negotiated Sunday Premium Pay at least as early as 1965. They specifically included it in their negotiated contract of September 1, 1967. That contract remained in effect after negotiations were rejected by the [Agency] in 1975." Id. at 16. The Arbitrator also found that Sunday premium pay was paid continuously from 1975 to 1983 and that the stipulation of facts indicates that Sunday premium pay existed since 1983. Id. at 15-16. The Arbitrator concluded, "based upon the clear language of contracts dating back to 1967, and continuous past practice . . . that under the meaning of Section 704 of [the CSRA], Sunday Premium Pay was 'the subject of negotiations' prior to the critical date of August 19, 1972[.]" Id. at 17-18.

As to the second issue, the Arbitrator rejected the Agency's argument that the employees are not entitled to Sunday premium pay because it is not "prevailing in the private sector as agreed on by Management and the Union." Id. at 10. The parties stipulated that "Sunday Premium Pay, among other pay practices, is not paid by five companies . . . listed in the agreement for purposes of determining basic pay and prevailing pay practices." Id. at 5. The Arbitrator held that because the employees' entitlement to Sunday premium pay is established by contract, the Agency's argument that Sunday premium pay is not in accordance with prevailing rates and practices is irrelevant. The Arbitrator found that the parties had an opportunity to negotiate concerning prevailing rates and practices and that they did so when they established their control group of companies. The Arbitrator also found that because the parties included a provision providing for Sunday premium pay in their collective bargaining agreement, the employees' right to Sunday premium pay "is no longer based on prevailing rates, but on the language of the contract itself." Id. at 26.

The Arbitrator agreed with the Union that "Section 704 preserves the right to negotiate, but [does not,] at the same time[,] require[] contracts to adhere precisely to each individual kind of prevailing rate and practice[.]" Id. at 19. The Arbitrator recognized the requirement in law that Federal prevailing rate employees negotiate their pay and pay practices in accordance with prevailing rates and practices. However, the Arbitrator found that section 9(b)(1) of the PRSA also is applicable. According to the Arbitrator, section 9(b)(1) precludes a construction of the law that abrogates, modifies or otherwise affects in any way the provisions of any contract pertaining to wages, the terms and conditions of employment, and other employment benefits of prevailing rate employees. The Arbitrator stated that "[a]n examination of the statutes and cases requires the conclusion that the fact that the control group of companies do not pay Sunday Premium Pay is not fatal to the Union's position." Id. at 19. The Arbitrator concluded "that the Union negotiated a 25% differential for Sunday Premium Pay" and that the employees are entitled to Sunday premium pay under the parties' negotiated agreement. Id. at 26.

Finally, concerning the third issue, the Arbitrator stated that "[t]he Agency is required to reinstate the 25% Sunday Premium Pay differential, and to pay such differential to all bargaining unit employees who performed non-overtime work on Sunday, on and after July 19, 1987." Id. at 27. The Arbitrator retained jurisdiction to allow the Union to file an application for reasonable attorney fees and to resolve any dispute concerning the implementation of the award.

III. Positions of the Parties

A. Agency's Exceptions

The Agency contends that the Arbitrator's award "is contrary to law, namely, section 704 of the [CSRA] and other sections of law[.]" Exceptions at 2. The Agency argues that the Arbitrator's conclusion that Sunday premium pay was the "subject of negotiation" between the Agency and the Union is contrary to the definitions of "collective bargaining agreement," "collective bargaining," and "conditions of employment," in sections 7103(a)(8), (12) and (14) of the Statute, respectively, and is contrary to section 9(b) of the PRSA and section 704 of the CSRA. Id.

The Agency states that "Sunday Premium Pay, although listed in a 1967 contract, was so listed only for information purposes as an 'entitlement' along with other entitlements provided by law under the mistaken belief that these employees were entitled to Sunday Premium Pay by statute." Id. at 7. The Agency asserts that the award "is contrary to law because the [a]ward concludes that Sunday Premium Pay was 'negotiated' in the 1967 agreement and continually thereafter." Id. at 16. The Agency argues that "[t]he Arbitrator misinterpreted the meaning of the term 'negotiations' within the context of 'collective bargaining' under section 704 by determining that Sunday Premium Pay benefits themselves were 'negotiated' for employees." Id. The Agency contends that "Sunday Premium Pay was merely listed in the 1967 agreement as a statutory entitlement for eligible employees. It was not 'negotiated' as a contractual benefit under 5 U.S.C. § 7103(a)(12) and, thus, has no legal effect as a contract clause aside from the statutory benefits which it lists." Id.

The Agency also contends that the Arbitrator's award is inconsistent with section 704 because it requires the Agency to pay Sunday premium pay even though the parties have stipulated that the companies used to determine prevailing rates and practices do not pay Sunday premium pay. The Agency asserts that the Arbitrator's finding that "the term 'prevailing rates and practices' in section 704 is only a 'guideline[,]'" and his conclusion that Sunday premium pay need not be currently prevailing among the surveyed companies because it had been negotiated in the contract prior to August 19, 1972, are contrary to the plain language of section 704, its legislative history, the Authority's interpretation of section 704 and other applicable case law. The Agency states that, under section 704, "[i]f the pay practice is not currently prevailing in the industry, the parties may not negotiate over that pay practice." Id. at 22. The Agency maintains that because "Sunday Premium Pay is not a currently prevailing practice in the industry, the parties may not negotiate over that practice." Id. at 22-23. The Agency argues that "[s]ince the payment of Sunday Premium Pay is not authorized or valid under section 704, the Agency was required to terminate this pay practice even assuming it could be considered to have been negotiated prior to August 19, 1972." Id. at 23.

The Agency states that "[a]lthough the Agency believes that an award of attorney fees pursuant to the Back Pay Act is unwarranted under 5 U.S.C. § 5596(b) and 7701(g), it is premature at this time to file exceptions to that remedy because the Arbitrator has not rendered an award of attorney fees." Id. at 7.

B. Union's Opposition

The Union states that "[t]he Arbitrator correctly concluded that Sunday premium pay had been the subject of negotiation prior to August 19, 1972." Opposition at 2. The Union contends that the Arbitrator's decision is in accordance with applicable law and is supported by the evidence. The Union argues that the Arbitrator's award "is well founded on principles of contract and collective bargaining law, and does not conflict with applicable law[.]" Id. at 5.

The Union asserts that Sunday premium pay should be "classified as terms and conditions of employment" and, therefore, "it need not be a prevailing practice, and the parties' stipulation [that the practice does not exist in the surveyed companies] is of no effect." Id. at 8. The Union also asserts that even if a Sunday premium provision is a "pay and pay practice" pursuant to section 704(b), the Arbitrator's "interpretation of the language 'in accordance with prevailing pay and pay practices' does not conflict with other laws." Id. at 11.

IV. Analysis and Conclusions

The issue in this case is whether the Arbitrator's enforcement of the Sunday premium pay provision in the parties' collective bargaining agreement is contrary to section 704 of the CSRA.

As we find below, Sunday premium pay is a "pay practice" within the meaning of section 704(b) of the CSRA. The Agency contends, however, that enforcement of the Sunday premium pay provision is contrary to section 704 because: (1) Sunday premium pay was not the subject of negotiations between the parties prior to August 19, 1972, as required under section 704(a); and (2) Sunday premium pay is not currently prevailing in the industry and, therefore, the provision is inconsistent with section 704(b). For the reasons fully explained below, we find that the Sunday premium pay provision was negotiated consistent with subsections (a) and (b) of section 704 and is, therefore, enforceable.

A. The Meaning of Section 704(a)

1. Section 704(a) Preserves Bargaining Rights

Section 704(a) provides that "[t]hose terms and conditions of employment and other employment benefits with respect to Government prevailing rate employees to whom section 9(b) of [the PRSA] applies which were the subject of negotiation in accordance with prevailing rates and practices prior to August 19, 1972, shall be negotiated" after the enactment of the CSRA in accordance with section 9(b) of the PRSA without regard to any provision of the Statute that is inconsistent with section 704(a). 5 U.S.C. § 5343 (Amendments, note). Thus, under section 704(a), in order for a term or condition of employment or other employment benefit to be negotiable, it must have been the subject of negotiations in accordance with prevailing rates and practices prior to August 19, 1972.

2. The Requirement in Section 704(a) Is Met

The Arbitrator found that Sunday premium pay was the subject of negotiations between the parties prior to August 19, 1972. The Arbitrator based his findings on the parties' agreements from 1967 and on other evidence in the record.

Despite the undisputed fact that the parties had a contract as early as 1967 which included a provision dealing with Sunday premium pay,(3) the Agency challenges the Arbitrator's finding that Sunday premium pay was the subject of negotiations between the parties prior to August 19, 1972. The Agency argues that Sunday premium pay "was merely listed as a statutory entitlement rather than negotiated as a contractual benefit," and, thus, was not the subject of negotiation within the meaning of section 704(a). Exceptions at 22. We reject that argument. We conclude that the Agency's argument constitutes mere disagreement with the Arbitrator's evaluation of the evidence, his findings and conclusions based on that evidence and with his interpretation of the provisions of the parties' collective bargaining agreement. Disagreement with an arbitrator's evaluation of the evidence and with his findings and conclusions, based thereon, provides no basis for finding an award deficient. See, for example, U.S. Department of Health and Human Services, Social Security Administration, Baltimore, Maryland and American Federation of Government Employees, Local 1336, 37 FLRA 766 (1990). Likewise, disagreement with an arbitrator's interpretation of the collective bargaining agreement provides no basis for finding the award deficient. See, for example, Veterans Administration Medical Center, Leavenworth, Kansas and American Federation of Government Employees, Local 8, 35 FLRA 14 (1990).

Accordingly, we find that the Agency has failed to demonstrate that the Arbitrator's findings are inconsistent with section 704(a) of the CSRA.

B. The Meaning of Section 704(b)

1. Section 704(b) Establishes the Scope of Bargaining for "Pay and Pay Practices"

Section 704(b) "serve[s] to 'grandfather-in' bargaining rights for prevailing rate employees with respect to . . . non-negotiable pay provisions reserved to agency regulation." United States Information Agency v. FLRA, 895 F.2d 1449, 1451 (D.C. Cir. 1990) (USIA v. FLRA), (emphasis and citations omitted). Section 704(b) modifies the scope of bargaining established in subsection 704(a) with respect to the specific category of terms and conditions of employment described as "pay and pay practices." See Fort Stewart Schools v. FLRA, 110 S. Ct. 2043, 2045-49 (1990) (matters concerning the pay and benefits of employees are related to "conditions of employment" within the meaning of the Statute). Section 704(b) sets the parameters for bargaining on pay and pay practices for agencies and prevailing rate employees covered by section 704.

In USIA v. FLRA, the court held that "[w]hen the subject of negotiation is 'pay and pay practices,' . . . negotiability may depend on current prevailing practices in the industry." USIA v. FLRA, 895 F.2d at 1454 (emphasis omitted). The court stated:

[I]f a pay practice is not among the current industry practices in the industry, the parties may not negotiate over that subject. . . . But if the pay practice has some place in current industry practice, then the parties must negotiate over the subject and subsection 704(b) functions as a restriction on the permissible outcome of negotiations.

Id. at 1455 (emphasis in original). We adopted the court's interpretation of section 704(b) in Boulder City, 36 FLRA at 7.

Under section 704(b), prevailing rate employees who negotiated rates of pay and pay practices in accordance with prevailing rates and practices prior to August 19, 1972, may negotiate current pay and pay practices only in accordance with current prevailing rates and practices in the industry. That is, under section 704(b), current prevailing practices in the industry determine whether and the extent to which section 704 prevailing rate employees may bargain concerning a specific pay practice. Accordingly, we reject the Arbitrator's statement that section 704(a) "does not require negotiation of pay in accordance with prevailing rates at this time." Award at 21-22. However, for the reasons set forth below, the Arbitrator's incorrect statement concerning the relevance of current prevailing practices to negotiation of pay and pay practices does not render his award deficient.

2. Sunday Premium Pay is a "Pay Practice" Within the Meaning of Section 704(b)

For purposes of section 704(b), "pay practices" are matters historically considered to be part of an employee's compensation package, such as: (1) adjustments to an employee's basic rate of pay; (2) matters concerning the payment of differentials, overtime, and premiums; and (3) any other general compensation policies that entered into and became a part of the employee's total compensation package. United States Information, Voice of America, 37 FLRA 849, 861 (1990) (USIA, VOA II). "Sunday premium pay" is defined in the parties' agreement as "base pay plus twenty-five (25) percent premium for all nonovertime regularly scheduled Sunday work." Award at 2. Because Sunday premium pay was established as a form of premium pay for bargaining unit employees, we find that Sunday premium pay constitutes a pay practice within the meaning of section 704(b).

3. Section 704(b) Does Not Require the Termination of Collective Bargaining Agreements

The Agency states that under section 704, "[i]f the pay practice is not currently prevailing in the industry, the parties may not negotiate over that pay practice." Exceptions at 22. The Agency argues that because the parties have stipulated that Sunday premium pay is not currently prevailing among the five companies listed in the parties' agreement, it is not prevailing in the industry and, therefore, "Sunday premium pay is not authorized or valid under section 704[.]" Id. at 23. The Agency asserts that it was required to terminate the payment of Sunday premium pay because Sunday premium pay is not a currently prevailing practice in the industry.

As we understand it, the Agency's position is that the Sunday premium pay provision in the parties' agreement is unenforceable because the provision does not reflect the prevailing practice which currently exists in the industry. The question raised by the Agency's contention is whether section 704 renders the pay and pay practice provisions of a collective bargaining agreement unenforceable if those provisions are not consistent with "current" prevailing practices.

The parties' stipulation that the five companies used for determining prevailing rates and practices do not currently pay Sunday premium pay does not relieve the Agency of its obligation to pay Sunday premium pay in accordance with the parties' collective bargaining agreement. Although the current prevailing practices are relevant to determine whether parties "shall" negotiate pay and pay practices under section 704(b), they have no effect on the pay and pay practice provisions of an existing collective bargaining agreement. Once the parties have negotiated a lawful agreement concerning pay and pay practices, the parties are bound by the terms of their agreement.

We find nothing in section 704(b) or the Statute as a whole to support the proposition that section 704 either requires or permits agencies to unilaterally terminate an existing agreed-upon pay practice under section 704 because of an alleged change in prevailing industry practices. Section 704(b) does not operate to void a provision of a collective bargaining agreement that is not in accordance with current prevailing practices. Compare Department of the Navy, United States Marine Corps, 34 FLRA 635 (1990) (the agency did not commit an unfair labor practice by revoking a memorandum of understanding (MOU) with the union because the MOU was rendered unenforceable by operation of law). Rather, section 704 qualifies the obligation to bargain over provisions in the first instance. A provision is not rendered unlawful by a change in the prevailing rates and practices during the life of a collective bargaining agreement, however.

Our conclusion in this regard is consistent with the long established principle in labor law that a party to a valid collective bargaining agreement, as a general rule, cannot make unilateral mid-term alterations to that agreement. See Standard Fittings Co. v. NLRB, 845 F.2d 1311 (5th Cir. 1988) (discussing the rights of parties to a collective bargaining agreement to make a mid-term unilateral alteration to an agreement). See also National Treasury Employees Union v. FLRA, 810 F.2d 295 (D.C. Cir. 1987) (concerning the obligation of agencies and unions, under the Statute, to bargain concerning mid-term changes).

We note our recent decision in Boulder City. In that case, the Authority held, on reconsideration, that no unfair labor practice was committed when the Agency terminated its practice of paying Sunday premium pay because the matter of Sunday premium pay was nonnegotiable in the circumstances of that case. The circumstances of that case were that "[t]he parties' stipulation, containing their agreement as to prevailing industry practice, establishe[d] that Sunday premium pay [was] not 'among the current practices in the industry[]' for purposes of section 704(b)." Id. at 8. Thus, the Authority concluded that section 704(b) precluded negotiations over that matter.

The major difference between that case and this one is that in Boulder City there was no contract provision covering Sunday premium pay. See Department of the Interior, Bureau of Reclamation, Wash. D.C. and Department of the Interior, Bureau of Reclamation, Lower Colorado Regional Office, Boulder City, Nevada and American Federation of Government Employees, Local 1978, AFL-CIO, 33 FLRA 671, 674 (1989). Instead, the agency terminated a practice and the issue became one of negotiability when the union proposed to continue the practice until negotiations over the substance of the change, as well as impact bargaining, had been completed. The Authority determined there was no duty to bargain over the substance of the change under section 704(b) and, thus, the agency did not commit an unfair labor practice when it refused to bargain over the substance of the change.

In the case at hand, there is a currently existing contract provision covering Sunday premium pay for these grievants which the Agency is seeking to terminate. Therefore, Boulder City provides no support for the Agency's unilateral mid-term termination of the Sunday premium pay provision in the parties' agreement.

Accordingly, we find that the Sunday premium pay provision was negotiated consistent with section 704 and that the Agency is not permitted under section 704(b) to unilaterally terminate the provision in its collective bargaining agreement relating to Sunday premium pay on the basis that that provision does not reflect the "current" prevailing practices in the industry.

C. The Statute Does Not Render the Award Deficient

"The plain meaning of [section 704(a) of the CSRA] is that it exempts provisions of specified collective bargaining agreements from the limitations on the scope of bargaining set forth in the Statute[.]" Columbia Power Trades Council and United States Department of Energy, Bonneville Power Administration, 22 FLRA 998, 1005 (1986). See U.S. Department of the Interior, Bureau of Reclamation, Lower Colorado Region, Yuma, Arizona and National Federation of Federal Employees, Local 1487, 41 FLRA No. 1, slip op. at 10-13 (1991). Further, section 704(b) specifically provides for the negotiation of the pay and pay practices of prevailing rate employees without regard to any provision of chapter 71 of title 5 (the Statute) "to the extent that any such provision is inconsistent with [section 704]." Thus, parties who negotiate under section 704 may agree to contract provisions concerning terms and conditions of employment and pay and pay practices, notwithstanding that such provisions might otherwise conflict with the Statute. Because section 704 preserves the parties' right to negotiate on certain matters that might otherwise be in conflict with the Statute, a provision in a collective bargaining agreement that was negotiated consistent with section 704 is enforceable in arbitration despite any inconsistency with the Statute.

We find that although the subsections of section 7103 of the Statute cited by the Agency are applicable to the parties' collective bargaining relationship, those subsections do not render the award deficient. Under section 704 of the CSRA, the Sunday premium pay provision of the collective bargaining agreement is enforceable in arbitration despite any inconsistency with the Statute. We conclude that the Agency's contention that the award is inconsistent with certain subsections of section 7103 of the Statute provides no basis for finding the award deficient.

We note that the Arbitrator found that the parties negotiated over the subject of Sunday premium pay and that the parties executed the Supplementary Wage Schedules that included a provision for Sunday premium pay. In our opinion, those negotiations constituted "collective bargaining" within the meaning of section 7103(a)(12) and the Supplementary Wage Schedules executed by the parties constitute a "collective bargaining agreement" within the meaning of section 7103(a)(8). Further, the Agency's argument that proposals concerning the benefits of Federal employees who are not provided those benefits under statute do not relate to "conditions of employment" within the meaning of section 7103(a)(14) of the Statute, is without merit. The Authority has consistently held that, to the extent matters concerning employee compensation are not provided for by statute, those matters are related to conditions of employment and, therefore, are within the duty to bargain. Fort Stewart (Georgia) Association and Fort Stewart Schools, 28 FLRA 547 (1987), affirmed sub nom. Fort Stewart Schools v. FLRA, 110 S. Ct. 2043 (1990).

D. Summary

This case concerns the enforcement of a "pay practice" within the meaning of section 704(b) of the CSRA. A pay practice is also a "term and condition of employment," within the meaning of section 704(a). Therefore, in order to be consistent with section 704, the pay practice must have been negotiated consistent with both section 704(a) and section 704(b).

Section 704(a) provides that in order for a term or condition of employment or other employment benefit to be negotiable, it must have been the subject of negotiations in accordance with prevailing rates and practices prior to August 19, 1972. The only contention made by the Agency in this regard is that the Sunday premium pay provision was merely listed in the contract as a statutory entitlement rather than having been negotiated. We reject that argument and find that the Agency has failed to demonstrate that the Sunday premium pay provision was not the "subject of negotiation," within the meaning of section 704(a).

Under section 704(b), an agency is not obligated to bargain over collective bargaining proposals concerning pay or pay practices that are not in accordance with prevailing rates and practices. In other words, the negotiability of proposals concerning pay and pay practices under section 704(b) depends on current (at the time of negotiations) prevailing practices in the industry. However, section 704(b) does not render contract provisions unenforceable during the life of a contract.

Consistent with the foregoing, the Agency has not demonstrated that the Arbitrator's award is deficient. Although it does not affect the Arbitrator's conclusion that the Agency improperly terminated Sunday premium pay, we nonetheless reject the Arbitrator's determination (Award at 21-22) that section 704 "does not require negotiation of pay in accordance with prevailing rates at this time" because, for the reasons stated above, the Arbitrator's determination is contrary to section 704(b).

V. Decision

The Agency's exceptions are denied.

APPENDIX A

Section 704 of the CSRA, codified at 5 U.S.C. § 5343 (Amendments), provides that:

(a) Those terms and conditions of employment and other employment benefits with respect to Government prevailing rate employees to whom section 9(b) of Public Law 92-392 applies which were the subject of negotiation in accordance with prevailing rates and practices prior to August 19, 1972, shall be negotiated on and after the date of the enactment of this Act {Oct. 13, 1978} in accordance with the provisions of section 9(b) of Public Law 92-392 without regard to any provision of chapter 71 of title 5, United States Code (as amended by this title), to the extent that any such provision is inconsistent with this paragraph.

(b) The pay and pay practices relating to employees referred to in paragraph (1) of this subsection shall be negotiated in accordance with prevailing rates and pay practices without regard to any provision of--

(A) chapter 71 of title 5, United States Code (as amended by this title), to the extent that any such provision is inconsistent with this paragraph;

(B) subchapter IV of chapter 53 and subchapter V of chapter 55 of title 5, United States Code; or

(C) any rule, regulation, decision, or order relating to rates of pay or pay practices under subchapter IV of chapter 53 or subchapter V of chapter 55 of title 5, United States Code.

Section 9(b) of Pub. L. No. 92-392, codified at 5 U.S.C. § 5343 (Amendments), provides that:

The amendments made by this Act shall not be construed to--

(1) abrogate, modify, or otherwise affect in any way the provisions of any contract in effect on the date of enactment of this Act [Aug. 19, 1972] pertaining to the wages, the terms and conditions of employment, and other employment benefits, or any of the foregoing matters, for Government prevailing rate employees and resulting from negotiations between Government agencies and organizations of Government employees;

(2) nullify, curtail, or otherwise impair in any way the right of any party to such contract to enter into negotiations after the date of enactment of this Act [Aug. 19, 1972] for the renewal, extension, modification, or improvement of the provisions of such contract or for the replacement of such contract with a new contract; or

(3) nullify, change, or otherwise affect in any way after such date of enactment [Aug. 19, 1972] any agreement, arrangement, or understanding in effect on such date [Aug. 19, 1972] with respect to the various items of subject matter of the negotiations on which any such contract in effect on such date [Aug. 19, 1972] is based or prevent the inclusion of such items of subject matter in connection with the renegotiation of any such contract, or the replacement of such contract with a new contract, after such date [Aug. 19, 1972].

APPENDIX B

The relevant provision of the parties' Supplementary Employee Management Agreement No. 1, dated September 1, 1967, provided:

GENERAL WORKING CONDITIONS AND RULES

GENERAL BENEFITS

1.1 The following benefits will be provided or granted by the United States to eligible employees in accordance with applicable Statutes, Civil Service rules and regulations, Departmental and Bureau rules and instructions, or other authority.

a.     Leave

b.     Retirement Benefits

c.     Injury Compensation

d.     Unemployment Compensation

e.     Social Security

f.     Group Life Insurance

g.     Group Health Insurance

h.     Holiday Benefits

i.     Per diem

j.     Government Employees Training

k.     Sunday differential

In addition to the benefits specified above, employees covered by this agreement shall be entitled to other applicable privileges and benefits for all Federal Civil Service employees.




FOOTNOTES:
(If blank, the decision does not have footnotes.)
 

1. The Agency and the Union filed supplemental submissions pursuant to 5 C.F.R. § 2429.26 of the Authority's regulations noting the Authority's decision in Department of the Interior, Bureau of Reclamation, Washington, D.C. and Department of the Interior Bureau of Reclamation, Lower Colorado Regional Office, Boulder City, Nevada, 36 FLRA 3 (1990) (Boulder City), petition for review filed sub nom. American Federation of Government Employees, Local 1918, AFL-CIO v. FLRA, No. 90-70388 (9th Cir. July 30, 1990); the decision of the United States Court of Appeals for the Tenth Circuit in United States Department of the Interior, Bureau of Reclamation, Rio Grande Project v. FLRA, 908 F.2d 570 (10th Cir. 1990) (Rio Grande Project v. FLRA); and presenting additional arguments. We find no circumstances warranting our consideration of the parties' unsolicited supplemental submissions in this case. However, we are cognizant of the case law cited by the parties and, where appropriate, we address those decisions in our analysis of the Agency's exceptions.